The 1999 Act was enacted into law on October 22, 1999 (Pub. L. 106-78) as an amendment to the Agricultural Marketing Act of 1946 (7 U.S.C. 1621-1627, 1635-1638d). The purpose of the 1999 Act was to establish a program of information regarding the marketing of cattle, swine, lambs, and the products of such livestock that provides information that can be readily understood by producers; improves the price and supply reporting services of USDA; and encourages competition in the marketplace for livestock and livestock products. On December 1, 2000, AMS published the final rule to implement the LMR program as required by the 1999 Act (65 FR 75464) with an effective date of January 30, 2001. This effective date was subsequently delayed until April 2, 2001 (66 FR 8151).

The statutory authority for the program lapsed on September 30, 2005. At that time, AMS sent letters to all packers required to report under the 1999 Act requesting they continue to submit information voluntarily. In October 2006, Congress passed the Livestock Mandatory Reporting Reauthorization (2006 Reauthorization Act) (Pub. L. 109-296). The 2006 Reauthorization Act re-established the regulatory authority for the continued operation of the LMR program through September 30, 2010, and separated the reporting requirements for sows and boars from barrows and gilts, among other changes. On May 16, 2008, USDA published the final rule to re-establish and revise the LMR program (73 FR 28606). The rule incorporated the swine reporting changes contained within the 2006 Reauthorization Act, and enhanced the program's overall effectiveness and efficiency based on AMS' experience in the administration of the program. The LMR final rule became effective on July 15, 2008.

The Food, Conservation, and Energy Act of 2008 (2008 Farm Bill) (Pub. L. 110-234) directed the Secretary of Agriculture (Secretary) to conduct a study to determine advantages, drawbacks, and potential implementation issues associated with adopting mandatory wholesale pork reporting. The report from this study concluded that voluntary negotiated wholesale pork price reporting is thin, and becoming thinner. It also found some degree of support for moving to mandatory price reporting at every segment of the industry interviewed, and that the benefits likely would exceed the cost of moving from a voluntary to a mandatory reporting program for wholesale pork. The report was delivered to Congress on March 25, 2010. A copy of the full report is available on the AMS Web site at http://www.ams.usda.gov/AMSv1.0/marketnews by clicking on “Livestock, Meats, Grain, and Hay,” then “Livestock Mandatory Reporting.”

On September 28, 2010, the 2010 Reauthorization Act (Pub. L. 111-239), reauthorized LMR for an additional 5 years and added a provision for mandatory reporting of wholesale pork cuts. The 2010 Reauthorization Act directed the Secretary to engage in negotiated rulemaking to make required regulatory changes for mandatory wholesale pork reporting and establish a negotiated rulemaking committee to develop these changes. The statute required that the committee include representatives from (i) organizations representing swine producers; (ii) organizations representing packers of pork, processors of pork, retailers of pork, and buyers of wholesale pork; (iii) the USDA; and (iv) interested parties that participate in swine or pork production. Further, the 2010 Reauthorization Act stated that any negotiated rulemaking committee established by the Secretary would not be subject to the Federal Advisory Committee Act (5 U.S.C. Appendix 2).

The objective of this rule is to improve the price and supply reporting services of AMS in order to encourage competition in the marketplace for wholesale pork products by increasing the amount of information available to participants. This is accomplished through the establishment of a program of information regarding the marketing of wholesale pork products as specifically directed by the 1999 Act, the 2010 Reauthorization Act, and these regulations, as described in detail in the background section. Further, a mandatory wholesale pork reporting program will address concerns relative to the asymmetric availability of market information. Previously, pork processors were not required by law to report wholesale pork cut prices. Rather, AMS collected information on daily sales and price information from pork processors on a voluntary basis. The 2008 Farm Bill directed the Secretary to conduct a study to determine advantages, drawbacks, and potential implementation issues associated with adopting mandatory wholesale pork reporting. The study found that wholesale pork price reporting is thin, and frequently results in missing or unreportable price quotes for subprimals.

This final rule is issued in accordance with the Mandatory Price Reporting Act of 2010 (2010 Reauthorization Act) [Pub. L. 111-239], which reauthorized Livestock Mandatory Reporting for 5 years and required the addition of wholesale pork through negotiated rulemaking.

This final rule requires packers to report wholesale pork sales to AMS. Specifically, the rule outlines what information packers will be required to submit to AMS, how the information should be submitted, and other program requirements. Packers will submit the price of each sale, quantity, and other characteristics (e.g., type of sale, item description, destination) that AMS will use to produce timely, meaningful market reports.

The final rule is effective January 7, 2013. The effective date for this final rule is the date on which packers are required to submit data. Data submitted after this date is subject to audit for compliance with the 1999 Act and subsequent regulations, including this final rule.

During the 4-month period following the publication of the regulation, AMS will conduct an industry education and outreach program concerning the provisions and requirements of this rule. The Agency believes this period of time is adequate for packers to adapt to the wholesale pork reporting requirements.

AMS plans to continue publishing voluntary wholesale pork reports for a period of 180 days after the effective date of this regulation.

The benefits of this rule are diffuse and difficult to quantify; therefore, this analysis considers benefits only on a qualitative basis. The qualitative benefits derived from the literature are:

1. The increased number of firms reporting prices to AMS under the mandatory program will provide a more complete data set, leading to increased price transparency and more efficient price discovery;

2. Allows AMS more opportunity to keep wholesale pork reporting current with industry marketing practices and product offerings; and,

3. Provides information to industry participants that cannot afford to purchase data, including small pork processing operations, small wholesalers and retailers, and direct and niche marketing operations.

The major cost of complying with this rule involves the information collection and reporting process. The regulatory objective of this rule is to increase the amount of information available to participants in the marketplace for wholesale pork and pork products by mandating reporting of market information by certain members of the industry. The Committee developed the rule to achieve this objective in the most cost-effective manner possible. To the extent practicable, the Committee drew upon current industry practices and reporting procedures for other commodities covered by LMR in order to minimize the burden to the industry.

Annual industry costs are expected to be $95,770. These represent start-up costs associated with information technology enhancements, recordkeeping, and submission costs. The annual cost for each of the 56 respondents is estimated to be $1,710. Total annual cost to the government is expected to be approximately $300,000. This is largely for salaries and benefits for personnel who will collect, review, assemble, and publish market reports on wholesale pork. Additional costs of approximately $325,000 will be incurred in the first year to accommodate information technology system development. A complete discussion of the cost and benefits can be found under the Executive Order 12866 section.

AMS convened a negotiated rulemaking committee to develop the regulatory language outlined in this rule as mandated by the 2010 Reauthorization Act. The negotiated rulemaking process, which is authorized by the Negotiated Rulemaking Act of 1996 (NRA) (5 U.S.C. 561-570), involves a committee composed of people representing interests that will be significantly affected by the rule, and the rulemaking agency developing the regulations.

On November 24, 2010, AMS published a notice announcing its intent to convene a negotiated rulemaking committee (75 FR 71568). The notice sought public comment on the need for the committee and on its proposed membership, and provided others interested in being committee members the opportunity to submit nominations. AMS proposed a number of organizations for membership on the committee that represented those interests required to be included on such a committee by the 2010 Reauthorization Act.

Additionally, AMS solicited nominations from affected organizations who also wanted to be represented on the committee. In determining membership, AMS considered whether the interest represented by a member will be affected significantly by the final product of the committee and whether that interest was already adequately represented by other members. Under section 562(5) of the NRA, “interest” means “with respect to an issue or matter, multiple parties which have a similar point of view or which are likely to be affected in a similar manner.” In accordance with the NRA, committee membership was limited to a maximum of 25 members.

On January 26, 2011, AMS announced the establishment of the Wholesale Pork Reporting Negotiated Rulemaking Committee (Committee); responded to comments from the November 24, 2010, notice; identified the final list of members; and set forth the dates for the first meeting (76 FR 4554). The Committee members were: American Meat Institute; Chicago Mercantile Exchange; Food Marketing Institute; Grocery Manufacturers Association; Livestock Marketing Information Center; National Farmers Union; National Livestock Producers Association; National Meat Association; National Pork Producers Council; North American Meat Processors Association, American Association of Meat Processors, and Southeastern Meat Association (one combined representative for all three per organizations' request); United Food and Commercial Workers Union; and USDA, Agricultural Marketing Service.

On February 8-10, 2011, the Committee met in St. Louis, Missouri. Notably, during this meeting, the Committee members developed ground rules that addressed general rules of conduct, participation, and reiterated the Committee's purpose. The ground rules also established that all decisions would be made by “consensus,” and defined “consensus” as unanimous concurrence among the Committee members. The Committee held second (76 FR 12887) and third (76 FR 23513) meetings in Arlington, Virginia; March 15-17, 2011, and May 10-11, 2011, respectively. All meetings were open to the public without advance registration. Members of the public were given opportunities to make statements during the meetings at the discretion of the Committee, and were able to file written statements with the Committee for its consideration. The language developed by the Committee served as the basis for the proposed rule (77 FR 16951) and the regulatory text outlined in this final rule.

Pork processors, or packers, will be required to report sales of wholesale pork to AMS so that AMS may produce timely, meaningful market reports. These requirements are discussed in detail in the sections immediately following and represent the information on price, volume, and related characteristics of wholesale pork sales that packers will be required to submit under LMR.

According to the LMR program (7 CFR part 59), a packer, for purposes of swine and wholesale pork reporting, is defined as any person engaged in the business of buying swine in commerce for the purposes of slaughter, of manufacturing or preparing meats or meat food products from swine for sale or shipment in commerce, or of marketing meats or meat food products from swine in an unmanufactured form acting as a wholesale broker, dealer, or distributor in commerce. For any calendar year, the term “packer” includes only federally inspected swine processing facilities that slaughtered an average of at least 100,000 swine per year during the immediately preceding 5 calendar years and a person that slaughtered an average of at least 200,000 sows, boars, or combination thereof per year during the immediately preceding 5 calendar years. Additionally, in the case of a swine processing plant or person that did not slaughter swine during the immediately preceding 5 calendar years, it shall be considered a packer if the Secretary determines the processing plant or person should be considered a packer under this subpart after considering its capacity.

For the ease of the reader, this section is organized to highlight major components of the rule.

The term “wholesale pork” represents what is widely considered wholesale pork to packers, processors, retailers, and others in the supply chain. For example, items with commonly-added ingredients used to extend shelf life, such as a salt or sodium phosphate solution, are included in this definition, and, therefore, required to be reported. However, items that are flavored (e.g., teriyaki pork tenderloins, seasoned ribs, lemon pepper sirloin roasts) are not considered wholesale pork and are, therefore, excluded from LMR reporting requirements. For the purposes of this rule, offal ( e.g., heart, kidney) is not considered wholesale pork; whereas processing floor variety meats that are normally harvested from the chilled carcass—such as neck bones, tails, skins, feet, hocks, jowls, and backfat—are considered wholesale pork and must be reported.

Packers will be required to report twice a day (by 10:00 a.m. and 2:00 p.m. Central Time) for barrow and gilt product and once per day (by 2:00 p.m. Central Time) for sow and boar product. These reporting times are outlined in section 59.205, and are consistent with reporting times for other commodities covered under LMR. Separation of the reporting requirements for sow and boar product will minimize the reporting burden on sow and boar packers where possible and makes the information published for sow and boar products more meaningful to the industry. As a general rule, these plants slaughter fewer animals than their counterparts who primarily slaughter barrows and gilts, and would, therefore, have a lower number of reportable transactions. Further, publishing sow/boar product information twice daily would provide little benefit in terms of added market transparency, as prices in this sector of the market fluctuate less than in the barrow/gilt market. Many of the plants producing this type of product would be smaller in nature, and it would be unnecessarily burdensome to require twice daily reporting.

Packers will submit prices using two different reporting bases: Free-on-Board (F.O.B.) Omaha basis, which was used for the voluntary program; and F.O.B. Plant basis, which is used for mandatory reporting of boxed beef and lamb. This method is used to assuage concern within the industry that moving to a different reporting basis would cause unnecessary disruption in the marketplace. To ensure consistent and uniform methodology is used to obtain F.O.B. Omaha prices, AMS will provide freight information. While this information is not part of the regulation and will not be published in the Code of Federal Regulations, AMS received comments during the public comment period that its proposed methodology did not capture all the variables involved in determining the cost of transportation. In response, AMS will investigate alternative methods for deriving an F.O.B. Omaha price and will consult, as necessary, with industry stakeholders. AMS is currently engaged in this research in order to have resolution by the informational meeting with packers, which will be scheduled following the publication of in the final rule. AMS does not believe this approach will impede or hinder packers' ability to adapt or develop information technology systems or otherwise prepare for mandatory wholesale pork reporting.

As discussed in the proposed rule, AMS initially considered two options in developing this information to derive F.O.B. Omaha prices—a freight map with concentric zones that reflect different freight adjustments based on a shipping destination's distance from Omaha and a per loaded mile freight rate. A zone map could prove to be difficult for reporting entities to comply with as it would not be practical to display every U.S. city, nor to expect reporting entities to know which cities belong in which zones. AMS believed a simpler option was to establish a per loaded mile freight rate that packers could apply. For example, to determine the F.O.B. Omaha price for a load of pork loins shipped to Phoenix, Arizona, the packer would figure the distance from Omaha to Phoenix and multiply that distance by the per loaded mile rate, which would then be divided by the total hundredweight of the product being shipped. This resulting freight expense would be deducted from the actual delivered price per hundredweight to reflect the F.O.B. Omaha price submitted to AMS. AMS also believed this method would be easier for reporting packers to comply with and document for audit purposes. It should be noted that regardless of the final method for determining freight, AMS will revisit this information on a quarterly basis to ensure it is up-to-date.

Prices reported to AMS shall include any applicable brokerage fees, but should not include any direct, specific, and identifiable marketing costs (such as point of purchase material, marketing funds, accruals, rebates, and export costs). Removing these types of additional costs provides AMS a more homogeneous price for reporting purposes. Furthermore, costs for things such as accruals or rebates, if known at the time of transaction, should be removed from the price provided to AMS. The requirements for reporting prices of wholesale pork sales are outlined in section 59.205.

Outlined below are items characteristic of a sale that will be reported to AMS. These items are discussed below appear in section 59.205.

Type of Sale. When packers report sales of wholesale pork to AMS, they will be identified using one of these three categories: Negotiated, forward, or formula marketing arrangement. A negotiated sale is one that represents what is considered the “spot” market, and, therefore, sets delivery parameters for both boxed product (within 14 days of the date of agreement) and combo product (within 10 days of the date of agreement). To ensure consistency with current industry practices, the day after the seller-buyer agreement will be considered “Day 1” for reporting delivery periods.

The definition of a forward sale is designed to capture transactions that occur outside the traditional negotiated, or spot, window. Therefore, the definition for forward sale means an agreement for the sale of pork where the delivery is beyond the timeframe of a negotiated sale and means a sale by a packer selling wholesale pork to a buyer of wholesale pork under which the price is determined by seller-buyer interaction and agreement.

The definition of a formula marketing arrangement bases the price paid not on seller-buyer interaction and agreement on a given day, but instead in reference to publicly available quoted prices. The definition of formula marketing arrangement was revised based on comments received to remove the requirement that this type of sale only covered product that had not already been produced. These definitions for the terms “Type of sale,” “Negotiated sale,” “Forward sale,” and “Formula marketing agreement” appear in section 59.200.

Specifications. Packers will report a description of the specifications of each pork item being transacted (e.g., vacuum-packed 1/4 inch loins) to AMS. It will be the agency's responsibility to group like products together for the purpose of publishing reports. The item's specification will also contain weight ranges for the product. Characteristics that entities would be required to report are outlined in section 59.205(a)(1).

Product Delivery Period. Packers will report the delivery period for negotiated pork trades in calendar days, as outlined in section 59.205(a)(1). This is consistent with other commodities reported under LMR, but is a change from the way transactions were reported under the voluntary system.

Pork class. Packers will report the type of swine from which the product was derived from one of three categories: Barrow/gilt, sow, or boar. This is outlined in section 59.205(a)(1) and is accompanied by a definition for “pork class” in section 59.200.

Destination. Packers will report a product's destination in one of three categories: Domestic, Export overseas, or North American Free Trade Agreement (NAFTA).

Refrigeration. Packers will report a product's refrigeration type as a means for distinguishing fresh product transactions that may be discounted or priced differently due to age of the product. Splitting the fresh category into two product age groups provides a means for identifying product that may be discounted due to potential shelf life limitations. For reporting purposes, “Day 1” is considered the day after production. The form contained in Appendix A provides timeframes against which packers will report product refrigeration.

Specialty Pork Products. Packers will be required to report specialty pork products in order to capture trade of wholesale pork that is produced or marketed under any specialty program, such as, but not limited to, genetically-selected pork, certified programs, or specialty selection programs for quality or breed characteristics. A trademark brand on a product will not by itself make the product a specialty pork product, as outlined in section 59.200.

This rule amends the regulations issued in 7 CFR part 59, Livestock Mandatory Reporting, to incorporate wholesale pork into LMR. Subpart A of part 59, General Provisions, addresses requirements pertinent to all aspects of mandatory reporting. Some conforming changes are necessary to fully incorporate wholesale pork into Subpart A, and are largely administrative in nature. Most sections in Subpart A remain unchanged, but are discussed here to provide context for the reader.

Section 59.10 details how packers will be required to report information and how reporting will be handled over weekends and holidays. The information will be reported to AMS by electronic means. Electronic reporting involves the transfer of data from a packer's electronic recordkeeping system to a centrally located AMS electronic database. The packer is required to organize the information in an AMS-approved format before electronically transmitting the information to AMS. Once the required information has been entered into the AMS database, it will be aggregated and processed into various market reports which will be released according to the daily and weekly time schedule set forth in these regulations. Information regarding the specific characteristics of each reported sale must be supplied by lot without aggregation. No changes were made to section 59.10 to accommodate the additional requirement of reporting wholesale pork cuts.

This rule requires the reporting of specific market information regarding the sales of wholesale pork products. Section 59.20 is amended by the addition of (f), Reporting Sales of Wholesale Pork. In addition to the aforementioned reporting requirements, packers will be required to maintain a record to indicate the time a unit of wholesale pork cuts was sold, as occurring either before 10 a.m. central time, between 10 a.m. and 2 p.m. central time, or after 2 p.m. central time. To allow packers time to collect, assemble, and submit the information to AMS by the prescribed deadlines, all covered transactions up to within one half hour of the specified reporting times are to be reported.

Further, section 59.20 identifies the recordkeeping requirements imposed by the 1999 Act and regulations on reporting entities. Reporting packers are required to maintain and to make available the original contracts, agreements, receipts, and other records associated with any transaction relating to the purchase, sale, pricing, transportation, delivery, weighing, slaughter, or carcass characteristics of all livestock and livestock products. In addition, they are required to maintain such records or other information as is necessary or appropriate to verify the accuracy of the information required to be reported under these regulations. All of the above mentioned documentation must be maintained for at least 2 years and must be made available to employees or agents of USDA for routine compliance audits, as well as for investigations involving suspected noncompliance or potential violations. More information regarding compliance and review procedures can be found in the LMR Information section of the Livestock and Grain Market News Web site at http://marketnews.usda.gov/portal/lg.

Lastly, under Subpart A, section 59.30 details the general definitions of terms used throughout the regulations and applicable to all subparts. Where definitions apply to only one reportable commodity, those are included in the appropriate subpart. For example, definitions that pertain only to swine and swine products are contained in Subpart C. The majority of definitions in section 59.30 remain unchanged from those that were published in the 2008 final rule. Changes to section 59.30 as a result of the addition of wholesale pork are found in the definitions for the terms “F.O.B.” and “Lot.” The change to F.O.B. is amended to require packers to report prices on both a plant and Omaha basis. The change to the term “Lot” adds wholesale pork. There is also an administrative change to the definition of IMPS to update a Web site address and phone number.

The 1999 Act set forth the requirements for maintaining confidentiality regarding the packer reporting of proprietary information and list the conditions under which Federal employees can release such information. While none of these provisions were amended by the 2010 Reauthorization Act or will be changed as a result of this rule, they are presented here for information. These administrative provisions also establish that the Secretary can make necessary adjustments in the information reported by packers and take action to verify the information reported, and directs the Secretary to report and publish reports by electronic means to the maximum extent practical. The 1999 Act provides for what constitutes violations of that Act, such as failure to report the required information on time or failure to report accurate information.

The section on enforcement establishes a civil penalty of $10,000 for each violation and provides for the Secretary's issuance of cease and desist orders. This section also provides for notice and hearing of violations before the Secretary, judicial review, and issuance of an injunction or restraining order. The fees section directs the Secretary to not charge or assess fees for the submission, reporting, receipt, availability, or access to published reports or information collected through this program. The section on recordkeeping requires each packer to make available to the Secretary on request for 2 years the original contracts, agreements, receipts, and other records associated with any transaction relating to the purchase, sale, pricing, transportation, delivery, weighing, slaughter, or carcass characteristics of all livestock and livestock products, as well as such records or other information that is necessary or appropriate to verify the accuracy of information required to be reported. Also, the 1999 Act provides that reporting entities will not be required to report new or additional information that they do not generally have available or maintain, or the provisions of which would be unduly burdensome.

As noted in the proposed rule (77 FR 16951), the Committee's work focused on developing regulatory text to implement mandatory wholesale pork reporting under the LMR program. The Committee also developed several recommendations that, while outside their statutory purview, were discussed in the proposed rule and were further supported by some of the comments received by AMS during the comment period. For a complete discussion of these recommendations, see the “Comments and Responses” section of this rule.

Subpart E of part 59 covers the OMB control number 0581-0186 assigned pursuant to the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. Chapter 35) for the information collection requirements listed in Subparts B through D of part 59. All required information must be reported to AMS in a standardized format. The standardized form is embodied in the data collection form that is contained in Appendix A and described in Appendix B at the end of this document.

For reporting wholesale pork information, swine packers will utilize one form (Appendix A). This additional reporting requirement does not impact the reporting requirement that packers may have for other reportable commodities, such as swine.

The final section of this document contains two appendices. These appendices will not appear in the Code of Federal Regulations. Appendix B describes the form that will be used by those required to report information under this program. The actual form is contained in Appendix A.

AMS received nine comments in response to the proposed rule (77 FR 16951). In general, commenters were supportive of the proposal, bringing wholesale pork under LMR, and of the negotiated rulemaking process. Many of the comments dealt with issues outside the scope of the proposed regulation, such as development of reports, transition period, and training sessions.

Two commenters stated that the definition of “Specialty pork product” should be amended to clarify that the examples identified in the definition of what constitutes a specialty pork product are not limiting or all inclusive. AMS agrees with this comment and believes the changes proposed do not contradict, only clarify, the work of the Committee. Accordingly, AMS has amended the definition of specialty pork product as it appears in this rule.

One commenter suggested AMS amend the definition of “Formula marketing arrangement” because the inclusion of the phrase “executed in advance of manufacture” would exclude formula-priced product whose sale is agreed upon following manufacture. AMS agrees with this comment and believes the changes proposed do not contradict, only clarify, the work of the Committee. Accordingly, AMS has amended the definition of formula marketing arrangement as it appears in this rule.

One commenter asked that AMS provide technical support personnel that packers can easily access as a means of reducing start-up costs. As outlined in the preamble of the proposed rule and in this final rule, AMS recognizes there are costs associated with complying with this new requirement of LMR. Further, AMS understands the differences that exist among companies, information technology (IT) systems, and business structure. While AMS does not have the resources to dedicate an IT specialist to this transition, it will make every effort to provide IT support when needed by packers. In regards to testing of the information technology systems, AMS understands that affected entities (i.e., packers) will not effectively be able to make enhancements to their reporting systems until the requirements are known; that is, until the final rule is published. AMS will work with packers to ensure that an appropriate amount of time is allowed for development and testing of systems necessary to submit the required data. Another commenter suggested that AMS' estimates for initial start-up costs and annual submission costs were too low; however, the commenter did not provide additional information.

Three commenters asserted that the 6-month transition period during which both mandatory and voluntary reports will be published side-by-side is insufficient and suggested instead a 12-month transition period. Commenters suggested that a 6-month period would not allow for observance of the seasonal differences that may exist, and, subsequently, would not provide market participants with enough information to adjust price formulas properly. While these comments do not pertain to the regulation, but rather to AMS' implementation of the mandatory wholesale pork reporting program, AMS will take these suggestions into account.

As described in the proposed rule, AMS plans to transition from a voluntary program to a mandatory program by publishing “dual” reports for 6 months. That is, for a period of time, AMS will publish reports reflecting information collected under a voluntary reporting system and reports reflecting information collected under a mandatory reporting system for wholesale pork. If AMS determines that the information collected under a voluntary program becomes of little utility before the 6-month mark, or if sufficient AMS resources are not available, it will cease collecting and publishing this information. On the contrary, if at the end of the 6-month period any problems still exist with the collection or publication of data, or if the cessation of dual reports would unnecessarily cause market disruption, AMS will consult with the industry to determine an appropriate course of action. In that instance, AMS would consider extending the dual reporting period until a full 12-month period has occurred. Further, during the transition period, AMS intends to publish reports reflecting information collected under the mandatory program on a delay and will consider the Committee's recommendation regarding the appropriate time to release such reports.

Three commenters stated their belief that the freight calculation methodology proposed by AMS is too simplistic. Commenters suggested that there are associated costs with loading product that may not be included if a simple “per mile” freight cost is used. Commenters believed this would result in F.O.B. Omaha prices that are higher than they should be, and that the agency should consider issues involving less-than-truckload (LTL) freight rates. While these comments do not pertain to the regulation, but rather to AMS' implementation of the mandatory wholesale pork reporting program, AMS will take these suggestions into account. AMS plans to discuss the freight calculation with stakeholders, with the goal of having the final methodology determined for the planned workshops. Additional discussion is provided in the Reporting Requirements section of this document.

Two commenters requested that AMS keep the reporting of pork skins destined for domestic, North American Free Trade Agreement (NAFTA), and overseas markets separate and distinct. While these comments do not pertain to the regulation, but rather to AMS' implementation of the mandatory wholesale pork reporting program, AMS will take these suggestions into account. Further, AMS is unable to determine if confidentiality issues will arise regarding these products until information is submitted under the new program. The 1999 Act requires USDA to publish mandatory data on livestock and meat price trends, contracting arrangements, and supply and demand conditions in a manner that protects the identity of reporting entities and preserves the confidentiality of proprietary transactions. AMS' guidelines, which are commonly referred to as the “3/70/20 rule” requires the following three conditions be met for publication of information: (1) At least three reporting entities need to provide data at least 50 percent of the time over the most recent 60-day time period; (2) No single reporting entity may provide more than 70 percent of the data for a report over the most recent 60-day time period; and (3) No single reporting entity may be the sole reporting entity for an individual report more than 20 percent of the time over the most recent 60-day time period.

One commenter suggested that AMS conduct training sessions for packers who will be required to submit wholesale pork prices under LMR. AMS agrees with this comment and has allotted $20,000 in funds for this type of activity, as outlined in the Executive Order 12866 and Executive Order 13563 sections of the proposed rule (77 FR 16951) and this rule.

This rule has been reviewed under Executive Order 12988, Civil Justice Reform. This rule is not intended to have retroactive effect. Section 259 of the 1999 Act prohibits States or political subdivisions of a State to impose any requirement that is in addition to, or inconsistent with, any requirement of the 1999 Act with respect to the submission or reporting of information, or the publication of such information, on the prices and quantities of livestock or livestock products. In addition, the 2010 Reauthorization Act does not restrict or modify the authority of the Secretary to administer or enforce the Packers and Stockyards Act of 1921 (7 U.S.C. 181-229); administer, enforce, or collect voluntary reports under the 1999 Act, the 2006 Reauthorization Act, or any other law; or access documentary evidence as provided under sections 9 and 10 of the Federal Trade Commission Act (15 U.S.C. 41-58). There are no administrative procedures that must be exhausted prior to any judicial challenge to the provisions of this rule.

AMS has considered the potential civil rights implications of this rule on minorities, women, or persons with disabilities to ensure that no person or group shall be discriminated against on the basis of race, color, national origin, gender, religion, age, disability, sexual orientation, marital or family status, political beliefs, parental status, or protected genetic information. This review included persons that are employees of the entities that are subject to this regulation. This rule does not require affected entities to relocate or alter their operations in ways that could adversely affect such persons or groups. Further, this rule would not deny any persons or groups the benefits of the program or subject any persons or groups to discrimination.

This rule has been reviewed under Executive Order 13132, Federalism. This Order directs agencies to construe, in regulations and otherwise, a Federal statute to preempt State law only when the statute contains an express preemption provision. This rule is required by the 1999 Act. Section 259 of the 1999 Act, Federal preemption, states, “In order to achieve the goals, purposes, and objectives of this title on a nationwide basis and to avoid potentially conflicting State laws that could impede the goals, purposes, or objectives of this title, no State or political subdivision of a State may impose a requirement that is in addition to, or inconsistent with, any requirement of this subtitle with respect to the submission or reporting of information, or the publication of such information, on the prices and quantities of livestock or livestock products.”

Prior to the passage of the 1999 Act, several States enacted legislation mandating, to various degrees, the reporting of market information on transactions of cattle, swine, and lambs conducted within that particular State. However, since the national LMR program was implemented on April 2, 2001, these State programs are no longer in effect. Therefore, there are no Federalism implications associated with this rulemaking.

This rule has been reviewed in accordance with the requirements of Executive Order 13175, Consultation and Coordination with Indian Tribal Governments. The review reveals that this regulation will not have substantial and direct effects on Tribal governments and will not have significant Tribal implications.

Executive Orders 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). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rule has been designated “not significant” under section 3(f) of Executive Order 12866, and, therefore, has not been reviewed by the Office of Management and Budget (OMB). The proposed rule (77 FR 16951), however, was designated significant; and, therefore, AMS prepared a cost-benefit analysis for the proposed rule, and it was reviewed by OMB. For the final rule, AMS has prepared a cost-benefit analysis notwithstanding this rule's non-significant designation.

Regulations must be designed in the most cost-effective manner possible to obtain the regulatory objective while imposing the least burden on society. This rule would amend the LMR regulations to implement mandatory wholesale pork reporting and was developed by the Committee, comprising organizations representing pork packers, processors, retailers, and buyers of wholesale pork; swine producers; USDA; and other interested parties.

Since all of the entities who will be required to report wholesale pork sales already report information under LMR regarding their swine purchases, costs to reporting another commodity are expected to be minimal. A complete analysis of the number of affected entities and the required volume of reporting is discussed under the Paperwork Reduction Act (PRA) section following this section.

Alternatives to the rule's language were thoroughly discussed during the course of the negotiated rulemaking meetings, and the consensus language reflects the best efforts of all participating parties to ensure the successful implementation of wholesale pork reporting.

Until the promulgation of this rule, pork processors were not required by law to report wholesale pork cut prices. Rather, AMS collected information on daily sales and price information from pork processors on a voluntary basis. The 2008 Farm Bill directed the Secretary to conduct a study to determine advantages, drawbacks, and potential implementation issues associated with adopting mandatory wholesale pork reporting. The study found that voluntary wholesale pork price reporting is thin, and frequently results in missing or unreportable price quotes for subprimals. The number of missing data has increased over time.

In addition, changes in the way pork is traded in recent years have led to inconsistencies in industry practices and current AMS guidelines for defining reportable trades. The study found that more pork is being: (1) Traded in forms that are either not reported or not reportable (e.g., enhanced product, case ready product, branded product, or frozen product); (2) transacted through intra-firm transfer, through inter-firm transfer, through formula pricing, through forward price contracts well in advance of delivery (beyond 7 or 10 days forward as used by AMS); and, (3) destined for export markets which are excluded from AMS pork price reports for the negotiated cash guidelines used by AMS.

As a result of thin pork price reporting, industry participants had raised concerns about potential selective price reporting in the voluntary program. These concerns have reduced the perceived value of published price reports to the industry. The study found support for mandatory price reporting throughout the industry, and concluded that the benefits likely would exceed the cost of moving from a voluntary to a mandatory reporting program for wholesale pork.

The benefits of this rule are diffuse and difficult to quantify; therefore, this analysis considers benefits only on a qualitative basis. A complete discussion of the benefits is found in the summary of benefits section. The major cost of complying with this rule involves the information collection and reporting process. The information collection and reporting process is explained in the Summary of Costs section and is referenced in section 59.10(f), Reporting Methods. A complete discussion of the cost analysis can be found in the summary of costs section.

Summary of Benefits. Government intervention in a market is conducted because the free market has tendencies to fail whenever certain criteria hold. Market failures occur in cases such as public goods, externalities, and asymmetric and/or missing information problems appear. Agricultural markets in particular are subject to information asymmetry, with both large and small operators in every aspect of the value chain, ranging from multinational corporations to part-time operators. Agricultural markets are also characterized by a large degree of uncertainty and missing information.

In 2001, George Akerloff, Michael Spence, and Joseph Stiglitz  1 won the Nobel Prize in Economics for their seminal work on the Economics of Information, establishing it as a field within economics. Their combined works showed that: (1) Even small gaps in information can cause a misallocation of resources; (2) attempts to gather information by market participants generally incur costs that may not be recouped; (3) participants may turn to the use of nonmarket “signaling” to gather information, rather than the price mechanism; (4) attempts to obtain information by the participants may themselves cause sufficient levels of distortion in the markets, even with small information costs; and, (5) the existence of other market failures can alter the individual's valuation of the benefits and costs of information. 2 Each of these situations can lead to either a failure to attain an efficient equilibrium, or may lead to multiple equilibriums, both of which reduce economic welfare. Failure to achieve an equilibrium outcome can result in the failure of supply and demand to intersect at an equilibrium point, with persistent surpluses or shortages in the market.

The wholesale pork reporting study mandated by Congress found evidence consistent with Akerloff, et al., and indicates that mandatory price reporting will improve information in the wholesale pork market. Following the results of Akerloff, et al. cited above, this report found that: (1) The wholesale pork reporting information under the voluntary program is thin, getting thinner, and does not properly reflect changes in the pork market in recent years. Mandatory reporting would improve this situation by increasing the number of reporting firms, including sow/boar meat in the reporting, responding to changes in the marketing of pork and pork products, and reducing the number of missing price quotes, particularly for subprimals; (2) Data users will have improved information without incurring additional costs such as private market analyses and data subscriptions, which may be too costly for small producers, small packers, small processors, and other data users; (3) Mandatory price reporting will lead to increased transparency in prices and more efficient price discovery. In addition, price data will be more consistent with current trade practices, providing more clear-cut market information, and less need for “signaling”; (4) Mandatory wholesale pork price reporting will reduce concerns the industry now has about selective price reporting, which can potentially distort market information; and (5) Mandatory wholesale pork price reporting will benefit small market participants to a greater extent than larger participants, who are likely to have more information available to them than the smaller participants, although larger firms with more staff may have greater ability to analyze the data than small firms. The report concluded that mandatory wholesale pork reporting would reduce the inequities in market information and create a more competitive environment.

These findings indicate that mandatory price reporting will be an improvement over the current voluntary program, and that market efficiency as well as overall economic welfare will be increased by implementing the mandatory price reporting program for pork and pork products. Research on existing mandatory livestock price reporting also supports this conclusion.

Early research on problems associated with pricing in livestock markets often considered the distinction between price determination and price discovery, and the resulting issues faced by livestock producers in a particular market. Ward and Schroeder (2009)  3 describe the difference between price determination and price discovery by noting that price determination is the interaction of supply and demand factors in a broad market situation to determine the general price level. Price discovery is the process whereby buyers and sellers interact in a specific market at a specific time to ascertain the value of a commodity in that market at that time. Price discovery involves the consideration of multiple factors, including market structure, futures prices and risk management options. However, the first consideration in price discovery is typically the general market price level, i.e. price determination is the starting point for price discovery.

The importance of price reporting by AMS is that it provides data that gives market participants knowledge of the general price levels of a commodity, as well as insight into the overall conditions in that market. This information assists participants in more effectively discovering prices in their specific market.

Research on livestock mandatory pricing has demonstrated that mandatory pricing does increase transparency and improves the efficiency of the price discovery process. Ward (2004a and b)  4 found that mandatory price reporting increased information, showing mandatory reports significantly improved the amount, type, and timeliness of data related to captive supplies, and increasing transparency. USDA's Economic Research Service (ERS) (Perry, MacDonald, Nelson, Hahn, Arnade and Plato, 2005)  5 extended Ward's work, yielding similar results. ERS also found that prices were twice as volatile under the mandatory system than under the voluntary system. The reason was thought to be the filtering or interpretive role of market reporters under voluntary reporting relative to the reduced filtering role with mandatory reporting.

Koontz (2007)  6 studied the vertical relationship between the national fed cattle price and boxed beef cutout values using a standard price transmission model. He found boxed beef cutout values had both a greater and quicker impact on fed cattle than before the mandatory program. However, he also detected more uncertainty. This supports earlier research indicating both increased transparency and increased volatility associated with mandatory reporting. In addition, Lee, Ward and Brorsen (2011)  7 examined the role of cash prices in price discovery for fed cattle and hogs as cash market share fell over the years of 2001-2010. They found that the cash market remains important for price discovery, although thinning of the cash market has had a negative impact on the process.

As the wholesale pork study indicated, there are some market participants who are likely to benefit more than others. Niche and direct marketing producers are likely to benefit from improved data, as they are less likely to be able to have other means of price determination available to them, primarily due to cost. These producers account for a small but growing segment of U.S. agriculture.

In summary, research on existing livestock mandatory price reporting has demonstrated that it has improved transparency issues in livestock markets, enabling more efficient and effective price discovery in these markets, although there has been increased variability in reported prices, largely due to the change in approach from voluntary to mandatory. This improved transparency and increased efficiency is consistent with economic theory of information. The wholesale pork reporting study mandated by Congress shows evidence that mandatory reporting will have a similar impact on the wholesale pork market.

For the economic analysis of the rule, AMS was unable to determine a quantitative assessment of the benefits due to limitations on existing research and the disparate nature of the benefits to be achieved. The qualitative benefits derived from the literature and are:

• The increased number of firms reporting prices to AMS under the mandatory program will provide a more complete data set, leading to increased price transparency and more efficient price discovery;

• Allows AMS more opportunity to keep wholesale pork reporting current with industry marketing practices and product offerings; and

• Provides information to industry participants that cannot afford to purchase data, including small pork processing operations, small wholesalers and retailers, and direct and niche marketing operations.

Summary of Costs. The regulatory objective of this rule is to increase the amount of information available to participants in the marketplace for wholesale pork and pork products by mandating reporting of market information by certain members of the industry. The rule was developed in the most cost-effective manner possible, and, to the extent practicable, draws upon current industry practices and reporting procedures for other commodities covered by LMR in order to minimize the burden to the industry.

The least cost reporting method to accomplish the objectives of the rule continues to be the transfer of electronic data from the reporting entity to AMS, as is the current practice with mandatory price reporting for other covered commodities. Electronic data transmission of information is accomplished using an interface with an existing electronic recordkeeping system. Packers will provide for the translation of the information from their existing electronic recordkeeping system into the required AMS standardized format. Once accomplished, the information will be electronically transmitted to AMS where it will be automatically loaded into an AMS database. We estimated that the creation of this interface by in-house computer personnel will require an industry average of 15 hours per respondent. Further, we estimated the cost per hour for labor to average $49.30 (Bureau of Labor Statistics), 8 for a total cost, on average, of $740. Those companies not having in-house computer personnel will incur such costs as are necessary to bring in outside computer programmers to accomplish the task.

Startup Cost Prorated over 3 Year Life of Program:

Additionally, AMS estimated the annual cost per respondent for the storage of the electronic data files which were submitted to AMS in compliance with the reporting provisions of this rule to be $116.10 (5 hours for recordkeeping at $23.22).

In this rule, information collection requirements include submission of the required information on a daily basis in the standard format provided in the Wholesale Pork Daily Report (LS-89). A copy of this report is included in the Appendices at the end of this rule. There are expected to be a total of 56 respondents (34 commodity pork processors, 12 sow and boar meat processors, and 10 processors of all types of meat). Plants that slaughter both commodity pork (from barrows and gilts), and sow/boar meat will file one combined report so that the maximum number of reports per day is two.

By dividing total submission costs of $75,465.00 over the total number of respondents (56) yield an average submission cost of $1,347.59 on an annual basis. This value can be used to estimate the total cost burden to the industry, which is determined to be $95,770.64 per year.

In 2010, federally inspected pork production was 22.274 billion pounds. Assuming this level of production, the cost of this final rule to the private sector is $4.30 per million pounds ($95,770.64/22.274 billion pounds).

In addition to these costs to packers for submitting information, AMS will reallocate staff, issue regulations, and set up an electronic database to capture data and develop reports. The 3 staff years required to administer and produce mandatory price reports include reporters and auditors. Salary-related costs in each year are estimated at $271,000. Other costs include approximately $20,000 for travel/transportation, training, and outreach; $5,000 for miscellaneous costs such as printing, training, office supplies, and equipment; and $325,000 in the first year for a computer systems contract to develop the database required to manage the data.

The mandatory price reporting program would cost AMS $621,161 in the first year of implementation, and subsequent year costs are estimated to be $296,161. Therefore, the costs would be roughly $404,500 per year.

Adding the costs to industry, together with the costs to government, yields the total cost to society associated with this regulation. Because benefits could not be quantified, comparison of costs with benefits is not possible. However, total costs, shown annually, over the life of the rule, and discounted over the life of the rule have been calculated. These figures show that this rule does not meet the threshold for an economically significant rule ($100 million).

This rule has been reviewed under the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612). The purpose of the RFA is to consider the economic impact of a rule on small business entities. Alternatives, which would accomplish the objectives of the rule without unduly burdening small entities or erecting barriers that would restrict their ability to compete in the marketplace, were evaluated by the Committee. Moreover, the requirements contained in this rule were negotiated with members of the industry, some of whom represented small and mid-size firms.

Regulatory action should be appropriate to the scale of the businesses subject to the action. The collection of information is necessary for the proper performance of the functions of AMS concerning the mandatory reporting of livestock information. The 1999 Act requires AMS to collect and publish livestock market information. The required information is only available directly from those entities required to report under the 1999 Act and by these regulations and exists nowhere else. Therefore, this rule does not duplicate market information reasonably accessible to USDA.

For any calendar year, any federally inspected swine plant which slaughtered an average of 100,000 head of swine a year for the immediately preceding 5 calendar years, and any packing firm that slaughtered at least 200,000 sows and/or boars on average during the preceding 5 years, are required to report information. Additionally, any swine plant that did not slaughter swine during the immediately preceding 5 calendar years is required to report if the Secretary determines that the plant should be considered a packer based on the capacity of the processing plant. This accounts for approximately 56 out of 611 swine plants or 9.2 percent of all federally inspected swine plants. Fully 90.8 percent of all swine plants in the U.S. are exempted by this rule from reporting information.

Accordingly, we also have prepared this final regulatory flexibility analysis. The RFA compares the size of meat packing plants to the North American Industry Classification System (NAICS) to determine the percentage of small businesses within the meat packing industry. Under these size standards, meat packing companies with 500 or less employees are considered small business entities.

Objectives and Legal Basis. The objective of this rule is to improve the price and supply reporting services of AMS in order to encourage competition in the marketplace for wholesale pork products by increasing the amount of information available to participants. This is accomplished through the establishment of a program of information regarding the marketing of wholesale pork products as specifically directed by the 1999 Act, the 2010 Reauthorization Act, and these regulations, as described in detail in the background section.

Estimated Number of Small Businesses. This rule provides for the mandatory reporting of market information by pork wholesalers who, for any calendar year, have slaughtered 100,000 head of swine during the immediately preceding 5 calendar years, or any packing firm that has slaughtered at least 200,000 sows and/or boars on average during the preceding 5 years. Processing plants that have not slaughtered livestock during the immediately preceding 5 calendar years are also required to report if the Secretary determines that the plants should be considered packers based on their capacity.

The NAICS size standard classifies a small business in the meat packing industry as a company with less than 500 employees. Although it is common in the red meat industry for larger companies to own several plants, some of which may employ less than 500 people, those companies with a total slaughter plant employment at all locations of less than 500 are considered to be small businesses for the purposes of this rule even though individual plants are mandated to report as provided by the 1999 Act, 2010 Reauthorization Act, and this regulation.

Approximately 36 individual pork packing companies representing a total of 56 individual plants are required to report information to AMS. Based on the NAICS size standard, 24 of these 36 pork packing companies are considered small businesses, representing 27 individual plants that are required to report. The figure of 56 plants required to report represents 9.2 percent of the swine plants in the United States. The remaining 90.8 percent of swine plants, nearly all estimated to qualify as small business, are exempt from mandatory reporting.

AMS estimates the total annual burden on each swine packing entity to be, on average, $1,710.19, including $1,347.59 for annual costs associated with electronically submitting data, $246.50 for annual share of initial startup costs of $739.50, and $116.10 for the storage and maintenance of electronic files that were submitted to AMS.

Projected Recordkeeping. Each packer required to report information to the Secretary must maintain such records as are necessary to verify the accuracy of the information provided to AMS. This includes information regarding price, volume, weight, cut, and other factors necessary to adequately describe each transaction. These records are already kept by the industry. Reporting packers are required by these regulations to maintain and to make available the original contracts, agreements, receipts, and other records associated with any transaction relating to the purchase, sale, pricing, transportation, delivery, or weighing of all transactions. Reporting packers are also required to maintain copies of the information provided to AMS. All of the above-mentioned paperwork must be kept for at least 2 years. Packers are not required to report any other new or additional information that they do not generally have available or maintain. Further, they are not required to keep any information that would prove unduly burdensome to maintain. The paperwork burden that is imposed on the packers is further discussed in the section entitled “Paperwork Reduction Act” that follows. In addition, we have not identified any relevant Federal rules that are currently in effect that duplicate, overlap, or conflict with this rule.

Professional skills required for recordkeeping under this rule are not different than those already employed by the reporting entities. Reporting will be accomplished using computers or similar electronic means. AMS believes the skills needed to maintain such systems are already in place in those small businesses affected by this rule.

This rule as directed by the 2010 Reauthorization Act requires pork packing plants of a certain size to report information to the Secretary at prescribed times throughout the day and week. These regulations already exempt many small businesses by the establishment of daily slaughter and processing capacity thresholds. Based on figures published by the National Agricultural Statistics Service (NASS), there were 611 federally inspected swine slaughter plants operating in the United States at the end of 2010. AMS estimates that approximately 56 swine plants are required to report information, representing 9.2 percent of all federally inspected swine plants. Therefore, fully 90.8 percent of all swine plants are not required to report.

The impact of the costs of the rule to industry was also analyzed by plant capacity, measured in terms of number of head slaughtered. Industry cost by firm size, as measured in number of head slaughtered, is shown in the following table. Firms that slaughter fewer than 100,000 per year are exempt from the rule. These data do not distinguish between barrow/gilt slaughter and sow/boar slaughter, so all firms are assumed to report on barrows/gilts.

The data show that on a per head basis, the costs of this rule range from 0.033 cents per head slaughtered for the largest firms to approximately one cent per head for the smallest plants affected by the rule. On average, the cost burden is 0.084 cents per head slaughtered. Roughly 30 plants, or 4.5 percent of all plants in the industry, have costs that exceed this value. With an average hog carcass price of $87.90 for the year to date, and an average weight of 205 pounds per carcass, the price paid per head is roughly $180. The additional cost of one cent per head, the largest expected cost for plants impacted by the rule, does not appear to represent a significant cost increase.

In the table below, showing data for 2010, 91.2 percent of all plants (or 557 of 611 plants) would not have been expected to incur any reporting costs. All the costs would have been borne by the largest 8.8 percent of plants. Because the data in this table do not differentiate between sow/boar and barrow & gilt plants, these figures are approximates of the actual values, but illustrate the expected distributional impacts of the rule.

In summary, the RFA analysis showed that of the 56 firms facilities that are required to report, 27 (just under half) qualify as being owned by small businesses. These 27 facilities are owned by 24 of the 36 companies subject to the rule. However, given the capital intensive nature of the industry, a more appropriate approach to the RFA analysis may be the number of head slaughtered by company. This approach was recognized by Congress in the original LMR legislation, by placing a 100,000 head minimum slaughter requirement on firms which report. Using that standard, fewer than 10 percent of all firms in the industry are affected by this regulation. In addition, the increased cost of the rule represents at most roughly 0.006 percent the current hog carcass value ($0.01/$180.00). Based on this analysis, AMS determined that the rule would not have a significant economic impact on a substantial number of small entities.

In accordance with 5 CFR part 1320, we include the description of the reporting and recordkeeping requirements and an estimate of the annual burden on packers required to report information under this rule. The OMB reference number assigned to this collection is 0581-0279. AMS plans to submit to OMB a request to merge this collection into the currently approved collection, “Livestock Mandatory Reporting Act of 1999,” OMB number 0581-0186. The reporting requirement timeline is fully discussed under Supplementary Information.

The information collection and recordkeeping requirements in this regulation are essential to establishing and implementing a mandatory program of livestock and livestock products reporting. Based on the information available, AMS estimates that there are 34 commodity pork packer plants, 12 sow/boar meat packer plants, and 10 packer plants processing both commodity pork and sow/boar meat that are required to report market information under this rule. These companies have similar recordkeeping systems and business operation practices and conduct their operations in a similar manner. AMS believes that all of the information required under this rule can be collected from existing materials and systems and that these materials and systems can be adapted to satisfy the new requirements.

The PRA also requires AMS to measure the recordkeeping burden. Under this rule, each packer required to report must maintain and make available upon request for 2 years, such records as are necessary to verify the accuracy of the information required to be reported. These records include original contracts, agreements, receipts, and other records associated with any transaction relating to the purchase, sale, pricing, transportation, delivery, weighing, slaughter, or carcass characteristics of all livestock. Under this rule, the electronic data files which the packers are required to utilize when submitting information to AMS will have to be maintained as these files provide the best record of compliance. Therefore, the recordkeeping burden includes the amount of time needed to store and maintain records. AMS estimates that, since records of original contracts, agreements, receipts, and other records associated with any transaction relating to the purchase, sale, pricing, transportation, delivery, and weighing of wholesale pork products are stored and maintained as a matter of normal business practice by these companies for a period in excess of 2 years, additional annual costs will nominal. AMS estimates the annual cost per respondent for the storage of the electronic data files which were submitted to AMS in compliance with the reporting provisions of this rule to be $116.10. This estimate includes the cost per respondent to maintain such records which is estimated to average 5 hours per year at $23.22 per hour.

In this rule, information collection requirements have been designed to minimize disruption to the normal business practices of the affected entities. The requirements include the submission of the required information on a daily basis in the standard format provided in the form included in the Appendices section. This form requires the minimal amount of information necessary to properly describe each reportable transaction, as required under this rule.

Estimate of Burden: Public reporting burden for collection of information is estimated to be 0.125 hours per electronically submitted response.

Respondents: Packer processing plants required to report information on wholesale pork sales to the Secretary.

Estimated Number of Respondents: 34 commodity pork plants, 12 sow/boar meat plants and 10 combination commodity pork/sow/boar meat plants.

Estimated Number of Responses per Respondent: 520 per year for commodity pork (2 per day for 260 days); 260 per year for sow/boar meat (1 per day for 260 days); and 520 per year (2 per day) for combination commodity pork/sow/boar meat.

Estimated Total Annual Burden on Respondents: 3,250 hours.

With 260 reporting days per year, commodity pork processors, and processors which produce a combination of commodity pork/sow/boar meat, will submit a total of 520 responses per year, and sow/boar meat processors will submit a total of 260 responses per year. This includes 5 hours for recordkeeping annually, for each of the 56 respondents (total recordkeeping hours of 280).

At 0.125 hours per submission, commodity pork/combination processors will require 65.0 hours of reporting time, while sow/boar meat processors will require 32.5 hours of reporting time.

Total annual submission costs for commodity pork and combination pork processors is expected to be $1,509.30 with a clerical cost of $23.22 per hour, including benefits. Annual costs for sow meat processors will equal $754.65.

A total of 44 respondents are expected to report commodity pork/combination wholesale data, while 12 sow/boar meat respondents are anticipated. Ten of the respondents will report on both types of product. In all, 56 different respondents will be reporting, incurring total annual submission costs of about $75,465.00.

Estimated Total Annual Burden on Respondents: $95,770.64 including $75,465.00 for annual costs associated with electronically submitted responses (3,250 annual hours (58.036 annual hours per 56 respondents) @ $23.22 per hour, for a total of $1,347.59 per respondent), initial electronic data transfer setup costs of $13,804.00 ($739.50 prorated over 3 years = $246.50 per 56 respondents), and $6,501.60 ($116.10 per 56 respondents) for the storage and maintenance of electronic files that were submitted to AMS.

For the reasons set forth in the preamble, Title 7, Chapter I, part 59 is amended to read as follows:

The final rule, “Damage Tolerance and Fatigue Evaluation of Composite Rotorcraft Structures,” published in the Federal Register (76 FR 74655) on December 1, 2011. In that rule, the FAA amended its regulations to require evaluation of fatigue and residual static strength of composite rotorcraft structures using a damage tolerance evaluation, or a fatigue evaluation if the applicant establishes that a damage tolerance evaluation is impractical.

In a correction document (77 FR 4890), published February 1, 2012, the FAA revised the DATES section of the final rule, noting that affected parties were not required to comply with the new information collection requirements in §§ 27.573 and 29.573 until OMB approved the FAA's request to collect the information. Sections 27.573 and 29.573 include new provisions requiring an applicant to submit damage tolerance and fatigue evaluation information for principal composite structural elements or components, detail design points, and fabrication techniques. OMB approval for the information collection requirement was pending at the time of §§ 27.573 and 29.573 publication.

Under the Paperwork Reduction Act, the FAA submitted the new information collection requirements for OMB review. OMB approved the collection on June 28, 2012, and assigned the information collection OMB Control Number 2120-0753, which expires on December 31, 2012.

This publication informs affected parties of the approval and announces that as of June 28, 2012, affected parties are required to comply with the new information collection requirements in §§ 27.573 and 29.573.

The final rule, “Fatigue Tolerance Evaluation of Metallic Structures,” published in the Federal Register (76 FR 75435) on December 2, 2011. In that rule, the FAA addresses advances in structural fatigue substantiation technology for metallic structures that provides an increased level of safety by avoiding or reducing the likelihood of the catastrophic fatigue failure of a metallic structure. These increased safety requirements help ensure that should serious accidental damage occur during manufacturing or within the operational life of the rotorcraft, the remaining structure could withstand, without failure, any fatigue loads that are likely to occur, until the damage is detected or the part is replaced.

In a correction document (77 FR 4890), published February 1, 2012, the FAA revised the DATES section of the final rule, noting that affected parties were not required to comply with the new information collection requirements in § 29.571 until OMB approved the FAA's request to collect the information. Section 29.571 includes new provisions requiring an applicant, when trying to obtain type certification of a rotorcraft, to submit substantiating data to show that the rotorcraft complies with specific certification requirements. OMB's approval for the information collection requirement was pending at the time of § 29.571 publication.

Under the Paperwork Reduction Act, the FAA submitted the new information collection requirements for OMB review. OMB approved the collection on June 28, 2012, and assigned the information collection OMB Control Number 2120-0752, which expires on June 30, 2015.

This publication informs affected parties of the approval and announces that as of June 28, 2012, affected parties are required to comply with the new information collection requirements in § 29.571.

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 published in the Federal Register on October 25, 2011 (76 FR 65991). That NPRM proposed to require repetitive detailed inspections for discrepancies of the horizontal stabilizer ballscrew assembly; repetitive lubrication of the horizontal stabilizer trim control system; repetitive measurements for discrepancies of the ballscrew to ballnut freeplay; and corrective actions, if necessary.

We gave the public the opportunity to participate in developing this AD. The following presents the comments received on the proposal (76 FR 65991, October 25, 2011) and the FAA's response to each comment.

Airlines for America (A4A), on behalf of its member American Airlines (AAL), asked that the NPRM (76 FR 65991, October 25, 2011) be withdrawn. A4A stated that in view of previously implemented maintenance procedures designed to prevent malfunctions of the horizontal stabilizer trim actuator (HSTA), and maintenance data gathered in accomplishing those and other related procedures, the NPRM is not necessary. A4A added that those procedures include instructions mandated by AD 2005-12-18, Amendment 39-14134 (70 FR 35166, June 17, 2005), which requires inspection and overhaul of the primary brake of the HSTA, “upgrades to HSTA maintenance in the Boeing maintenance planning document (MPD), and corresponding upgrades to air carrier maintenance programs.” AAL stated that the “Discussion” section of the NPRM specifies “Jackscrews and ballscrews are similar in function and have similar airplane level failure modes.” AAL noted that this statement is not accurate in defining the risk posed by the ballscrew design. AAL added that the ballscrew uses ball bearings for the primary load path, and a male thread nut for the secondary load path is more tolerant of inadequate lubrication conditions than the jackscrew/acme nut design used on Model MD-80 airplanes. AAL also stated that the NPRM specifies that the unsafe condition is likely to exist or develop on other products of the same type design, which misrepresents the level of risk to the Model 757 worldwide fleet.

We disagree with the requests to withdraw the NPRM (76 FR 65991, October 25, 2011). Although the maintenance procedures in AD 2005-12-18, Amendment 39-14134 (70 FR 35166, June 17, 2005), will prevent grease contamination on the primary HSTA brake, the repetitive intervals for the subject actions are not frequent enough to prevent corrosion in the ballscrew of the drive mechanism of the HSTA, which could result in undetected failure of both the primary and secondary load paths. In light of this, we have determined that the unsafe condition is likely to exist or develop on the affected airplanes. As a result of that determination, we are issuing this AD in order to eliminate the unsafe condition by requiring that the actions be done at the required intervals.

Captain Rick Petersen, a private citizen, asked that a “more deliberate emergency type directive” be issued instead of an NPRM (76 FR 65991, October 25, 2011). The commenter stated that extensive corrosion found on any flight control mechanism is enough evidence to justify an emergency type directive.

We do not agree with the commenter's request. Before issuing the NPRM (76 FR 65991, October 25, 2011), we considered the urgency of the identified unsafe condition and the actions required to correct that unsafe condition. We also considered appropriate compliance times for requiring that those actions be done, in order to correct the unsafe condition in a timely manner to ensure continued safety. We coordinated those times with the manufacturer. At that time, we determined that it was practicable to provide notice and opportunity for public comment. In addition, in consideration of the amount of time that has already elapsed since issuance of the original notice, we find that to further delay issuance of this final rule by converting it to another type of AD rulemaking is inappropriate and unnecessary. Therefore, we have not changed the AD in this regard.

A4A, on behalf of its members AAL and UPS, and Boeing requested that the airplane groups specified in paragraphs (g) and (h) of the NPRM (76 FR 65991, October 25, 2011) be identified in terms of flight hours instead of flight cycles. UPS stated that Boeing Alert Service Bulletin 757-27A0144, Revision 1, dated January 20, 2010, identifies flight hours for that determination. UPS added that in order to maintain consistency, flight cycles should be changed to flight hours. Boeing also noted that this is a grammatical error.

We agree with the commenters' requests. We inadvertently specified “total flight cycles” instead of “total flight hours.” Boeing Alert Service Bulletins 757-27A0144, and 757-27A0145, both Revision 1, both dated January 20, 2010, specify groups that “* * * have completed less than or equal to 15,000 flight hours” and that “have completed more than 15,000 flight hours.” We did not intend to differ from the service information. All the compliance times specified in paragraphs (g) and (h) of the NPRM (76 FR 65991, October 25, 2011) were expressed in terms of flight hours and we did not give notice in the NPRM that we were differing from the service information in this regard. Therefore, we have changed the term “total flight cycles” to “total flight hours” in the description of the affected airplanes for paragraphs (g) and (h) of this AD.

Boeing and A4A requested that we revise certain compliance times. Boeing asked that paragraphs (g)(1)(ii), (g)(3)(ii), (h)(1)(ii), (h)(3)(ii), (i)(1)(ii), and (i)(3)(ii) of the NPRM (76 FR 65991, October 25, 2011) be deleted, and that the compliance times in each sub-paragraph be consolidated into one compliance time in the applicable parent paragraph. Boeing stated that Boeing Alert Service Bulletins 757-27A0144 and 757-27A0145, both Revision 1, both dated January 20, 2010, do not differentiate between the airplanes on which a detailed inspection has or has not been done previously, and added that it is not included in the “Differences” section of the NPRM. Boeing noted that the only difference between the paragraphs (g)(1) and (g)(2) of the NPRM, paragraphs (g)(3) and (g)(4) of the NPRM, paragraphs (h)(1) and (h)(2) of the NPRM, paragraphs (h)(3) and (h)(4) of the NPRM, and paragraphs (i)(3) and (i)(4) of the NPRM is whether there is a 6 or 18 month compliance time allowance. Boeing also noted the only difference between paragraphs (i)(1) and (i)(2) of the NRPM is whether the HSTA has been overhauled. Boeing noted that this complicates the related actions in the NPRM, and is not necessary for the continued airworthiness of airplanes on which an HSTA is installed.

A4A, on behalf of its member AAL, requested that we revise the compliance times specified in paragraphs (g)(1), (h)(1), (i)(1), (g)(2), (h)(2), and (i)(2) of the NPRM (76 FR 65991, October 25, 2011), so that airplanes previously inspected and airplanes not previously inspected have the same compliance times, rather than allowing a longer compliance time for airplanes that have not been inspected. A4A also requested that we revise the compliance times specified in paragraphs (g)(3), (h)(3), (i)(3), (g)(4), and (h)(4) of the NPRM, so that HSTAs that have been previously lubricated are provided a longer compliance time.

We agree with the commenter's requests. Boeing Alert Service Bulletins 757-27A0144 and 757-27A0145, both Revision 1, both dated January 20, 2010, do not differentiate between the airplanes on which a detailed inspection has or has not been done previously. In light of this fact, we have deleted paragraphs (g)(1)(i), (g)(1)(ii), (g)(2), (g)(3)(i), (g)(3)(ii), (g)(4), (h)(1)(i), (h)(1)(ii), (h)(2), (h)(3)(i), (h)(3)(ii), (h)(4), (i)(1)(i), (i)(1)(ii), (i)(2), (i)(3)(i), (i)(3)(ii), and (i)(4) of the NPRM (76 FR 65991, October 25, 2011). The compliance times and the initial inspection and lubrication tasks specified in paragraphs (g), (h), and (i) of this AD have been consolidated to include the actions in those sub-paragraphs, and to simplify the compliance times. These changes are relieving and allow operators more time to incorporate the requirements of this AD into their maintenance schedules.

These compliance times differ from the compliance times in the referenced service information in that certain compliance times in this AD are based on time after the effective date of this AD. The compliance times in this AD will prevent airplanes from immediately being out of compliance with the AD requirements, because they will prevent grounding an airplane if it has already exceeded the compliance times specified in Boeing Alert Service Bulletins 757-27A0144, and 757-27A0145, both Revision 1, both dated January 20, 2010. The compliance times in this AD have precedence over the compliance times specified in Boeing Alert Service Bulletins 757-27A0144, and 757-27A0145, both Revision 1, both dated January 20, 2010. We have changed paragraphs (g), (h), and (i) of this AD accordingly by including the initial compliance times in revised paragraphs (g)(1), (g)(2), (h)(1), (h)(2), (i)(1), and (i)(2) of this AD. Paragraphs (g)(5), (h)(5), and (i)(5) of the NPRM (76 FR 65991, October 25, 2011), are specified as paragraphs (g)(3), (h)(3), and (i)(3) in this AD. We have clarified the compliance time in paragraph (i)(3)(i) of this AD (paragraph (i)(5)(i) of the NPRM) by revising the compliance time “Before the accumulation of 15,000 total flight hours after accomplishing an overhaul * * *” to specify “Within 15,000 flight hours after accomplishing an overhaul * * *.”

Boeing asked that we clarify the freeplay measurement language in the “Differences” section and paragraph (k) of the NPRM (76 FR 65991, October 25, 2011) to avoid misinterpretation by operators. Boeing stated that 0.001 inch of freeplay is sufficient to verify that the ballnut rolling elements are free and there is room for grease action. Boeing added that page 704 of the supplier Component Maintenance Manual (CMM) 27-41-10, specifies that axial lash of 0.002 to 0.006 inch is acceptable for assembly at overhaul. Boeing noted that that some margin of error on the low side of 0.002 inch is necessary to avoid unwarranted removal of units built to the low limit of tolerance, in addition to clarifying that there is a high limit (0.016 inch) as well as a low limit (0.001 inch). Boeing concluded that the acceptable range specified in paragraph (k) of the NPRM could be interpreted as 0.002 to 0.006 inch, which is not what was intended.

We agree with the request to clarify the freeplay measurement requirement, for the reasons provided. We have changed paragraph (k) of this AD accordingly. However, since the “Differences” section of the preamble does not reappear in the final rule, no change to the AD is necessary in this regard.

A4A, on behalf of its member AAL, asked that the language “hard time replacement program” be removed from the credit language specified in paragraph (l) of the NPRM (76 FR 65991, October 25, 2011). AAL stated that paragraph (l) of the NPRM provides credit for installation of new or overhauled HSTAs, but added that the quoted language could limit that credit. AAL noted that paragraph (l) of the NPRM specifies that the overhaul, when conducted as part of a hard time replacement program “meets the intent of one detailed inspection, one freeplay inspection, and one lubrication of the HSTA.” AAL stated that any overhaul that includes removal of the HSTA, and overhaul of the stabilizer ballscrew that are done in accordance with the instructions in the original equipment manufacturer CMM, should meet the intent of the subject actions, regardless of whether the overhaul is done as part of a “hard time replacement program.” AAL added that all overhauls, regardless of the reasons for removal, would meet the proposed requirements.

We agree with the request for the reasons provided. We have removed the subject language from paragraph (l) of this AD accordingly.

UPS asked that Note 1 of the NPRM (76 FR 65991, October 25, 2011) be removed because it serves no practical purpose. UPS stated that this note provides additional guidance for verification of the measurement in Subject 27-41-10, “Stabilizer Trim Ballscrew Freeplay,” of Chapter 27, “Flight Controls,” of the Boeing 757 Airplane Maintenance Manual (AMM), Revision 101, dated May 20, 2011. UPS added that, if this note refers to the measurement in paragraph (k) of the NPRM, it should also refer to CMM 27-41-05 for HSTA guidance for the 0.002 inch measurement.

We disagree with the request. The reference to Subject 27-41-10, “Stabilizer Trim Ballscrew Freeplay,” of Chapter 27, “Flight Controls,” of the Boeing 757 Airplane Maintenance Manual (AMM), Revision 101, dated May 20, 2011, is correct. The guidance in Note 1 of this AD refers maintenance personnel to the procedures that verify the measurement was not made in error when the ballnut freeplay measurement is less than the measurement required by the AD. We have made no change to the AD in this regard.

Boeing asked that we correct grammatical errors in the “Differences” and “Relevant Service Information” sections and paragraph (k) of the NPRM (76 FR 65991, October 25, 2011). Boeing stated that the word “then” was used instead of “than.”

We agree for the reason provided. We have changed the error in paragraph (k) of this AD; however, since the “Differences” and “Relevant Service Information” sections of the preamble do not reappear in the final rule, no change to the AD is necessary in this regard.

AAL asked that the cost estimate provided in the NPRM (76 FR 65991, October 25, 2011) be increased. AAL stated that the 13 work-hours specified in the “Costs of Compliance” section of the NPRM only include the time for initial accomplishment of the required actions. AAL added that the work-hours necessary for the repetitive actions are not included.

We agree that the economic analysis in the NPRM (76 FR 65991, October 25, 2011) did not include the cost of the work-hours necessary for the repetitive actions. We have changed the “Costs of Compliance” section below to include those work-hours.

A4A, on behalf of its member UPS, requested that we revise paragraph (j) of the NPRM (76 FR 65991, October 25, 2011) to remove reference to the AMM. UPS stated that, by referring to a specific revision of the AMM, operators would have to request an alternative method of compliance (AMOC) in order to use any later revisions of the AMM. UPS also suggested that Boeing revise Boeing Alert Service Bulletin 757-27A0144, Revision 1, dated January 2010, to include replacement procedures, and that we refer to that revised service bulletin.

We do not agree to revise paragraph (j) of this AD. We do not consider that delaying this action until after the manufacturer revises the service bulletin is warranted, since operators can accomplish the actions in accordance with the AMM. We also cannot use the phrase, “or later FAA-approved revisions,” in an AD when referring to the service document because doing so violates Office of the Federal Register (OFR) regulations for approval of materials “incorporated by reference” in rules. See paragraph (f) of section 51.1 of the Code of Federal Regulations (1 CFR 51.1(f)).

To allow operators to use later revisions of the referenced document (issued after publication of the AD), either we must revise the AD to reference specific later revisions, or operators must request approval to use later revisions as an alternative method of compliance with this AD under the provisions of paragraph (n) of this AD. We have not changed this AD in this regard.

A4A, on behalf of its member UPS, requested that we revise the NPRM (76 FR 65991, October 25, 2011) to allow credit for actions accomplished per the Boeing maintenance review board report/maintenance planning document (MRBR/MPD). UPS noted that these documents refer to the same AMM sections and tasks specified in Boeing Alert Service Bulletin 757-27A0144, Revision 1, dated January 20, 2010. UPS stated that an operator that performs actions following its maintenance program is not allowed credit for accomplishment of the task, and that the next required inspection should be done in accordance with the compliance times specified in Boeing Alert Service Bulletin 757-27A0144, Revision 1, dated January 20, 2010.

As stated previously, we have revised the compliance times in this AD so that the times do not depend on whether actions were done in accordance with Boeing Alert Service Bulletin 757-27A0144, Revision 1, dated January 20, 2010. Therefore, operators that did actions using the MRBR/MPD have the same initial compliance times as operators that did actions using Boeing Alert Service Bulletin 757-27A0144, Revision 1, dated January 20, 2010. We have not changed this AD in this regard.

We reviewed the relevant data, considered the comments received, and determined that air safety and the public interest require adopting the AD with the changes described previously. We also determined that these changes will not increase the economic burden on any operator or increase the scope of the AD.

We estimate that this AD affects 730 airplanes of U.S. registry. We also estimate that it takes about 13 work-hours per inspection, lubrication and measurement cycle per product to comply with this AD. The average labor rate is $85 per work-hour. Based on these figures, we estimate the cost of this AD to the U.S. operators to be $806,650, or $1,105 per product, per inspection, lubrication, and measurement cycle.

We estimate that it takes about 26 work-hours to do any HSTA replacement required based on the results of the inspection. We have no way of determining the number of aircraft that might need these replacements. The average labor rate is $85 per work-hour. Based on these figures, we estimate the cost of this replacement to the U.S. operators to be $2,210 per product, excluding parts costs, which vary depending on airplane configuration.

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.

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:

On February 28, 2012, at 77 FR 11787, the Federal Register published our notice of proposed rulemaking (NPRM), which proposed to amend 14 CFR part 39 to include an AD that would apply to Eurocopter France Model EC155B and EC155B1 helicopters with a VIP 4-seat bench. That NPRM proposed to require, before further flight, revising the Limitations section of the RFM, and within 15 hours time-in-service (TIS), converting the VIP 4-seat bench into a 3-seat configuration. Instead of revising the Limitations section and converting the VIP 4-seat bench, the NPRM proposed to allow modifying the rear VIP 4-seat bench or the front VIP 4-seat bench by installing shims, which would constitute terminating action for the requirements of this AD. The proposed requirements were intended to prevent overloading of the seat structure at the attachment point during a hard landing or emergency landing, which could result in the VIP 4-seat bench detaching from the floor and subsequent injury to the seat occupants.

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Union, has issued EASA AD No. 2009-0078R1, dated June 30, 2009 (AD No. 2009-0078R1), to correct an unsafe condition for the Eurocopter model EC155B and EC155B1, all serial numbers up to and including 6892, fitted with a VIP 4-seat bench, P/N 365V85-0045-01 or 365V85-0046-01. EASA advises that Eurocopter identified an unsafe condition while performing customization work that involved the installation of the VIP 4-seat bench. During the installation work, Eurocopter determined that the load strength of the seat attachment hardware of the seat installation did not meet certification specifications. EASA advises that this condition, if not corrected, would lead to overloading of the seat structure at the attachment point during an emergency landing, which could result in the seat bench detaching from the floor fitting rails and potentially resulting in injury to the seat occupants.

We gave the public the opportunity to participate in developing this AD, but we did not receive any comments on the NPRM.

These helicopters have been approved by the aviation authority of France and are approved for operation in the United States. Pursuant to our bilateral agreement with France, EASA, its technical representative, has notified us of the unsafe condition described in the EASA AD. We are issuing this AD because we evaluated all information provided by the EASA and determined the unsafe condition exists and is likely to exist or develop on other helicopters of the same type design and that air safety and the public interest require adopting the AD requirements as proposed.

Eurocopter has issued Emergency Alert Service Bulletin (ASB) No. 04A009, Revision 1, dated June 24, 2009 (Emergency ASB No. 04A009R1), which revises Emergency Alert Service Bulletin No. 04A009, Revision 0, dated March 30, 2009 (Emergency ASB No. 04A009R0). Emergency ASB No. 04A009R0 specified revising the RFM to restrict the VIP 4-seat bench to a maximum of 3 occupants and converting the VIP 4-seat bench into a 3-seat bench. EASA classified Emergency ASB No. 04A009R0 as mandatory to ensure the continued airworthiness of these helicopters and issued EASA Emergency AD No. 2009-0078-E, dated April 1, 2009 (Emergency AD No. 2009-0078-E).

Eurocopter has now developed optional terminating actions, and issued Service Bulletin No. 25-095, Revision 0, dated June 25, 2009 (SB No. 25-095), which specifies installing new shims between the attachment rails and the cabin floor at the seat position to strengthen the attachment security of the seat. Eurocopter also issued Emergency ASB No. 04A009R1, which retained the requirements of Emergency ASB No. 04A009R0 and specified that helicopters modified in accordance with SB No. 25-095 had met the requirements of Emergency ASB No. 04A009R1. In response, EASA issued AD No. 2009-0078R1, which retained the requirements of Emergency AD No. 2009-0078-E and added the optional terminating action of modifying the seat configuration to strengthen the attachment security of the seat. EASA AD No. 2009-0078R1 also allows, after installing the bench modification kit, removal of the RFM limitation of 3 occupants.

This AD specifies that the conversion of the VIP 4-seat bench to a 3-seat bench must occur within 15 hours TIS, while the EASA AD specifies that compliance must occur within 15 hours TIS or 7 days, whichever occurs first. This AD uses different P/Ns for the bench modification kits, because AD No. 2009-0078R1 and SB No. 25-095 use different P/Ns for the same part, and this AD uses the P/N in SB No. 25-095.

We estimate that this AD will affect 4 helicopters of U.S. registry. We estimate that it will take a negligible amount of work hours per helicopter to amend the Limitation section of the applicable RFM. We estimate it will take approximately 0.25 hour to convert the VIP 4-seat bench to a 3-seat bench at an average labor rate of $85 per work hour. Estimated labor costs for the conversion are approximately $21.25 per helicopter, and approximately $85 for the fleet. Based on these figures, we estimate the total cost impact of the AD on U.S. operators to be $85, assuming that no helicopter has been previously modified with the rear VIP bench seat retrofit kit P/N 365V08-0079-0171 and the front VIP bench seat retrofit kit P/N 365V08-0079-0271.

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 helicopters identified in this rulemaking action.

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 to the extent that it justifies making a regulatory distinction; and

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

We prepared an economic evaluation of the estimated costs to comply with this 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:

Authority for This Rulemaking

The FAA's authority to issue rules on commercial space transportation safety is found in Title 49 of the United States Codes, section 322(a), which authorizes the Secretary of Transportation to carry out Subtitle V, Chapter 509, 51 U.S.C. 50901-50923, popularly referred to as the Commercial Space Launch Act or the CSLA. The CSLA authorizes the Department of Transportation (DOT) and thus the FAA, through delegations, to oversee, license, and regulate commercial launch and reentry activities, and the operation of launch and reentry sites as carried out by U.S. citizens or within the United States. 51 U.S.C. 50904, 50905. The CSLA directs the FAA to exercise this responsibility consistent with public health and safety, safety of property, and the national security and foreign policy interests of the United States. 51 U.S.C. 50905. The FAA is also responsible for encouraging, facilitating, and promoting commercial space launches by the private sector. 51 U.S.C. 50903.

A direct final rule is a quicker way to issue rules that are not controversial. It is based on the Administrative Procedure Act's good cause exception to notice and comment procedures. 5 U.S.C. 553. We use this exception where we have found the public comment procedures to be unnecessary because we do not expect to receive adverse comment. It involves publishing a rule in the Federal Register with a statement that, unless we receive an adverse comment on the rule (or a notice of intent to file an adverse comment) within the comment period, the rule will become effective on a specified date. Normally, the effective date of a direct final rule is at least 30 calendar days after the end of the comment period.

An adverse comment explains why a rule would be inappropriate, or would be ineffective or unacceptable without a change. It may challenge the rule's underlying premise or approach. In determining whether an adverse comment is significant enough to end a rulemaking, we consider whether the comment raises an issue that would warrant a substantive response in a notice of proposed rulemaking (NPRM).

If we do not receive an adverse comment (or notice of intent to file an adverse comment), we publish a confirmation document in the Federal Register , generally within 30 calendar days after the comment period closes. The confirmation document tells the public the effective date of the direct final rule.

If we do receive an adverse comment (or notice of intent to file an adverse comment), we publish a Notice of Withdrawal in the Federal Register before the effective date of the direct final rule. The document may withdraw the direct final rule in whole or in part. We may incorporate the commenter's recommendation into another direct final rule or we may publish an NPRM.

The FAA anticipates that this regulation will not result in adverse or negative comment since its application is strictly voluntary. Therefore, the agency is issuing it as a direct final rule. This rule allows an operator of a Class 3  1 amateur rocket  2 to voluntarily apply for a license or experimental permit under chapter III. Because these applications are purely voluntary, there should be no adverse effects of this rule. Operators of Class 3 amateur rockets who do not wish to apply for a license or permit need not do so. Such operators would continue to operate as they do now under part 101.

The Regulatory Policies and Procedures of the Department of Transportation (DOT) (44 FR 1134; February 26, 1979) provide that to the maximum extent possible, operating administrations for the DOT should provide an opportunity for public comment on regulations issued without prior notice. Accordingly, the FAA invites interested persons to participate in this rulemaking by submitting written comments, data, or views. The agency also invites comments relating to the economic, environmental, energy, or federalism impacts that might result from adopting this final rule. The most helpful comments reference a specific portion of the document, explain the reason for any recommended change, and include supporting data. To ensure the docket does not contain duplicate comments, please send only one copy of written comments, or if filing comments electronically, please submit your comments only one time.

The FAA will file all comments we receive in the docket, as well as a report summarizing each substantive public contact with FAA personnel concerning this rulemaking. Before acting on this direct final rule, the FAA will consider all comments received on or before the closing date for comments. The agency will consider comments filed after the comment period has closed if it is possible to do so without incurring expense or delay. The FAA may change this direct final rule in light of the comments we receive.

Do not file in the docket information that you consider to be proprietary or confidential business information. Send or deliver this information directly to the person identified in the FOR FURTHER INFORMATION CONTACT section of this document. Mark the information that is considered proprietary or confidential. If the information is on a disk or CD ROM, mark the outside of the disk or CD ROM and also identify electronically within the disk or CD ROM the specific information that is proprietary or confidential.

Under 14 CFR 11.35(b), when the FAA is aware of proprietary information filed with a comment, the agency does not place it in the docket. The FAA holds it in a separate file to which the public does not have access, and the agency places a note in the docket that it has received it. If the FAA receives a request to examine or copy this information, the FAA treats it as any other request under the Freedom of Information Act, 5 U.S.C. 552. The FAA processes such a request under the DOT procedures found in 49 CFR part 7.

You can get an electronic copy using the Internet by:

(1) Searching the Federal eRulemaking portal at http://www.regulations.gov;

(2) Visiting the FAA's Regulations and Policies web page at http://www.faa.gov/regulations_policies/; or

(3) Accessing the Government Printing Office's web page at http://www.gpo.gov/fdsys/.

You can also get a copy by sending a request to the Federal Aviation Administration, Office of Rulemaking, ARM-1, 800 Independence Avenue SW., Washington, DC 20591, or by calling (202) 267-9680. Make sure to identify the docket and amendment numbers of this rulemaking.

Currently, the FAA's commercial space regulations specify that the requirements in chapter III do not apply to amateur rockets activities. This direct final rule amends § 400.2 of chapter III to allow operators of Class 3 amateur rockets to voluntarily apply to the FAA for a license or experimental permit.

Chapter III contains the requirements that apply to commercial space transportation activities conducted in the United States or by a United States citizen. Section 400.2 (Scope) states that the requirements of chapter III do not apply to amateur rocket activities. Section 1.1 of chapter I defines an amateur rocket as an unmanned rocket propelled by a motor or motors having a combined total impulse of 889,600 Newton-seconds (200,000 pound-seconds) or less; and cannot reach an altitude greater than 150 kilometers (93.2 statute miles) above the earth's surface.

In 2008, the FAA amended its regulations governing amateur rocket activities to create three separate classes of amateur rockets. 3

• Class 1 Model Rocket —Uses no more than 125 grams (4.4 ounces) of propellant; uses a slow-burning propellant; is made of paper, wood, or breakable plastic; contains no substantial metal parts; and weighs no more than 1,500 grams (53 ounces), including the propellant.

• Class 2 High-Power Rocket —An amateur rocket other than a model rocket that is propelled by a motor or motors having a combined total impulse of 40,960 Newton-seconds (9,208 pound-seconds) or less.

• Class 3 Advanced High-Power Rocket —An amateur rocket other than a model rocket or high-powered rocket.

On May 26, 2011, The National Aeronautics and Space Administration (NASA) issued Release 11-170, 4 which sought proposals for services from commercial suborbital flight providers and others to support the agency's Flight Opportunities Program. This program combines NASA's Facilitated Access to the Space Environment for Technology and Commercial Reusable Suborbital Research efforts.

On August 9, 2011, NASA issued Release 11-258  5 in which it selected seven companies to support its Flight Opportunities Program through launches to near space. In order for the financial responsibility requirements of the CSLA  6 to apply, NASA has required these operators to be licensed by the FAA. The suborbital launches under the NASA program typically involve smaller launch vehicles, some of whose launches would satisfy the amateur rocket definition, and thus would fall outside the scope of the FAA's space transportation regulations in chapter III.

At least one amateur rocket operator has sought to obtain an FAA license. The operator said it will not change its operational profile to otherwise fall within the authority of chapter III regulations. Without a rulemaking, the FAA may not entertain applications for the licensing or permitting of amateur rocket activities. 7

The CSLA provides that the United States should encourage private sector launches, reentries, and associated services and, only to the extent necessary, regulate those launches to ensure compliance with international obligations of the United States and to protect the public health and safety, safety of property, and national security and foreign policy interests of the United States. 8 Thus, because a license is necessary for a launch operator to be eligible for the NASA program, it is appropriate to issue this direct final rule to allow operators of specified amateur rockets to voluntarily submit an application for a chapter III license or experimental permit. 9

This direct final rule amends § 400.2 to allow operators of Class 3 amateur rockets to voluntarily apply to the FAA for a license or permit.

To accommodate NASA's interest in funding only licensed launches, the FAA will allow launches of sufficient size to voluntarily apply for an FAA license and, therefore, fall under the financial responsibility requirements of the CSLA. The changes do not apply to launches involving a Class 1 or Class 2 amateur rocket. Instead, they only apply to launch activities related to a Class 3 amateur rocket. The FAA will not solicit such applications, because solicitation would call into question whether the application was, in fact, voluntary.

Also, this rule only permits voluntary applications for a license from entities that are not part of the U.S. Government. The CSLA does not apply to activities the U.S. Government conducts for the government, which means the FAA does not have the authority to consider even voluntary applications for a license from other Federal agencies. 10

Further, a prospective applicant must keep in mind that once it applies for and accepts an FAA license or permit, part 101 will not apply and the requirements of chapter III will apply to and govern its operations. These requirements govern not only the operational safety requirements of chapter III, but also requirements applicable to financial responsibility, the signing of reciprocal waivers of claims, environmental impacts, and civil penalties.

Information collection requirements in the amendment to the Commercial Space Transportation Licensing Regulations have been previously approved by the Office of Management and Budget (OMB) under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)), and assigned OMB Control Number 2120-0608. This final rule allows launch operators that conduct certain amateur rockets launches an opportunity to voluntarily apply for a commercial space transportation license or experimental permit.

Changes to Federal regulations must undergo several economic analyses. First, Executive Order 12866 and Executive Order 13563 directs that each Federal agency shall propose or adopt a regulation only upon a reasoned determination that the benefits of the intended regulation justify its costs. Second, the Regulatory Flexibility Act of 1980 (Pub. L. 96-354) requires agencies to analyze the economic impact of regulatory changes on small entities. Third, the Trade Agreements Act (Pub. L. 96-39) prohibits agencies from setting standards that create unnecessary obstacles to the foreign commerce of the United States. In developing U.S. standards, this Trade Act requires agencies to consider international standards and, where appropriate, that they be the basis of U.S. standards. Fourth, the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) requires agencies to prepare a written assessment of the costs, benefits, and other effects of proposed or final rules that include a Federal mandate likely to result in the expenditure by State, local, or tribal governments, in the aggregate, or by the private sector, of $100 million or more annually (adjusted for inflation with base year of 1995). This portion of the preamble summarizes the FAA's analysis of the economic impacts of this direct final rule. We suggest readers seeking greater detail read the full regulatory evaluation, a copy of which we have placed in the docket for this rulemaking.

In conducting these analyses, FAA has determined that this final rule: (1) Has benefits that justify its costs, (2) is not an economically “significant regulatory action” as defined in section 3(f) of Executive Order 12866, (3) is not “significant” as defined in DOT's Regulatory Policies and Procedures; (4) will not have a significant economic impact on a substantial number of small entities; (5) will not create unnecessary obstacles to the foreign commerce of the United States; and (6) will not impose an unfunded mandate on state, local, or tribal governments, or on the private sector by exceeding the threshold identified above. These analyses are summarized below.

The FAA does not require licensing of amateur rocket operators, who may continue to operate as before, without incurring the cost of obtaining a license. The FAA notes that an operator's customers, including other agencies such as NASA, may require a license for an amateur rocket operator who wishes to provide launch services or to participate in programs, such as NASA's Flight Opportunities Program. Since this license is not an FAA requirement, the FAA attributes the costs of operator compliance to the customer, not to this rule. Whenever a license or permit is issued, the FAA will incur a cost to produce the authorization. Operators who choose to obtain a license under this rule will also incur costs although we do not attribute these costs to the rule, because they are voluntary.

The estimated cost associated with issuing licenses and experimental permits under this rule is $1.8 million ($1.5 million present value using a 7 percent discount rate and $ 1.7 million present value using a 3 percent discount rate) over 5 years for the cost to the government. Operator benefits are expected to equal or exceed their costs. The FAA is not able to quantify other societal benefits of this rule. To the extent the licensing requirements provide a societal benefit, those benefits, including any reduction in risk, may attend this rule. Those benefits are not quantifiable for launch vehicles of this size, but the benefits are present.

• Launch operators who would like to launch amateur rocket vehicles under a license or permit

• Customers, including NASA

• FAA

• All monetary values are expressed in 2011 dollars.

• The time horizon for the analysis is 5 years because this time period captures all of the relevant costs.

• Present value costs are estimated at 7 percent and 3 percent.

• Hourly burdened government rate is $51.72.

• Ten operator licenses for amateur rocket launches will be issued over the first 5 years. 11

• Operator licenses for reusable launch vehicles are valid for 2 years.

• Operators will begin license renewal process for each license the second year of the license.

• Operators will renew with amendments to include additional configurations.

• Cost of these renewals will be 70 percent of the cost of the original license because configurations will be expanded beyond original license.

• There will be multiple launches per year.

• We assume amateur rocket operators who choose to obtain a license will decide to launch from a licensed launch site which will already have a completed environmental review or which will have a government grant for preparing an environmental review. This would result in minimal costs.

Because the rule is voluntary, the FAA does not require amateur operators to obtain a license. Amateur rocket operators will choose to obtain an FAA license in order to launch rockets only if their expected benefits exceed their costs. An operator will seek a license only if the costs of obtaining a license are worth it. Any benefit to the operator associated with having a license will be realized only after an operator has incurred the cost of obtaining a license. This rule encourages rocket launches, which is consistent with the FAA mission. The FAA is not able to quantify other societal benefits of this rule, other than to note the expected benefits exceed the expected costs.

Although the FAA does not attribute such costs to this rule, the FAA notes that amateur rocket operators would incur costs to submit the data and analyses to the FAA for a license or experimental permit and for the cost of third party liability insurance. Assuming 10 licenses are issued in the first 5 years, operators will voluntarily expend a total of $2 million ($1.66 million present value using a 7 percent discount rate and $ 1.85 million present value using a 3 percent discount rate) over 5 years for licenses. These costs are presented in the table below:

The FAA would incur the cost of reviewing and processing the materials that the operators submit for a license or experimental permit. These costs are presented in the table below:

The Regulatory Flexibility Act of 1980 (Pub. L. 96-354) (RFA) establishes “as a principle of regulatory issuance that agencies shall endeavor, consistent with the objectives of the rule and of applicable statutes, to fit regulatory and informational requirements to the scale of the businesses, organizations, and governmental jurisdictions subject to regulation. To achieve this principle, agencies are required to solicit and consider flexible regulatory proposals and to explain the rationale for their actions to assure that such proposals are given serious consideration.” The RFA covers a wide-range of small entities, including small businesses, not-for-profit organizations, and small governmental jurisdictions. Agencies must perform a review to determine whether a rule will have a significant economic impact on a substantial number of small entities. If the agency determines that it will, the agency must prepare a regulatory flexibility analysis as described in the RFA.

However, if an agency determines that a rule is not expected to have a significant economic impact on a substantial number of small entities, section 605(b) of the RFA provides that the head of the agency may so certify and a regulatory flexibility analysis is not required. The certification must include a statement providing the factual basis for this determination, and the reasoning should be clear.

The FAA believes that this final rule will not have a significant impact on a substantial number of entities for the following reasons: The rule is voluntary and does not create costs on operators. Also, operators of amateur rockets would not willingly obtain licenses or experimental permits if the costs were to exceed the expected benefits.

Therefore, as the Acting FAA Administrator, I certify that this rule will not have a significant economic impact on a substantial number of small entities.

The Trade Agreements Act of 1979 (Pub. L. 96-39), as amended by the Uruguay Round Agreements Act (Pub. L. 103-465), prohibits Federal agencies from establishing standards or engaging in related activities that create unnecessary obstacles to the foreign commerce of the United States. Pursuant to these Acts, the establishment of standards is not considered an unnecessary obstacle to the foreign commerce of the United States, so long as the standard has a legitimate domestic objective, such as the protection of safety, and does not operate in a manner that excludes imports that meet this objective. The statute also requires consideration of international standards and, where appropriate, that they be the basis for U.S. standards. The FAA has assessed the potential effect of this final rule and determined that it will have only a domestic impact and therefore will not create unnecessary obstacles to the foreign commerce of the United States.

Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) requires each Federal agency to prepare a written statement assessing the effects of any Federal mandate in a proposed or final agency rule that may result in an expenditure of $100 million or more (in 1995 dollars) in any one year by State, local, and tribal governments, in the aggregate, or by the private sector; such a mandate is deemed to be a “significant regulatory action.” The FAA currently uses an inflation-adjusted value of $143.1 million in lieu of $100 million. This direct final rule does not contain such a mandate; therefore, the requirements of Title II of the Act do not apply.

The FAA has analyzed this final rule under the principles and criteria of Executive Order 13132, Federalism. We determined that this action will not have a substantial direct effect on the States, or the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, we determined that this final rule does not have federalism implications.

FAA Order 1050.1E identifies FAA actions that are categorically excluded from preparation of an environmental assessment or environmental impact statement under the National Environmental Policy Act in the absence of extraordinary circumstances. The FAA has determined this rulemaking action qualifies for the categorical exclusion identified in Chapter 3, paragraph 312d, governing rulemakings such as this, and involves no extraordinary circumstances.

The FAA has analyzed this final rule under Executive Order 13211, Actions Concerning Regulations that Significantly Affect Energy Supply, Distribution, or Use, 66 FR 28355 (May 18, 2001). We have determined that it is not a “significant energy action” under the executive order because it is not a “significant regulatory action” under Executive Order 12866, and it is not likely to have a significant adverse effect on the supply, distribution, or use of energy.

I. Rulemaking Procedure

In the Federal Register of March 23, 2012 (77 FR 16923), FDA published a direct final rule to eliminate the requirement that many of our written agreements and MOUs with other departments, Agencies, and organizations be published in the Federal Register . We explained that we issued this rule as a direct final rule because we believed it was noncontroversial and did not anticipate receiving significant adverse comments. We concurrently published in the Federal Register of March 23, 2012 (77 FR 16971) a companion proposed rule, substantively identical to the direct final rule, that provided a procedural framework from which to proceed with standard notice-and-comment rulemaking in the event we were required to withdraw the direct final rule because of significant adverse comments. A significant adverse comment is defined as a comment that explains why the rule would be inappropriate, including challenges to the rule's underlying premise or approach, or would be ineffective or unacceptable without change. Any comments received under the companion proposed rule were treated as comments regarding the direct final rule and vice versa. A full description of FDA's policy on direct final rule procedures may be found in a guidance document published in the Federal Register of November 21, 1997 (62 FR 62466). This guidance document may be accessed at http://www.fda.gov/RegulatoryInformation/Guidances/ucm125166.htm.

We received one comment on the proposed rule, which we considered significantly adverse. Therefore, in the Federal Register of June 27, 2012 (77 FR 38173), we withdrew the direct final rule. This final rule summarizes and responds to this comment on the direct final rule and proposed rule. See section IV of this document for a discussion of the comment and FDA's response.

In the Federal Register of October 3, 1974 (39 FR 35697), we announced that copies of all our MOUs transacted with government Agencies and nongovernment organizations were available for public review at our offices during working hours and would be published in the Federal Register . We subsequently codified this policy in the Federal Register of December 24, 1974 (39 FR 44602 at 44651) and recodified it where it currently appears at § 20.108 (21 CFR 20.108) in the Federal Register of March 22, 1977 (42 FR 15616 at 15625).

Consumers, industry, professional groups, associations, educators, and other government Agencies had manifested widespread interest in the texts of these MOUs. The intent of § 20.108 was to promote transparency by providing access to these stakeholders.

This final rule will eliminate the requirement in current § 20.108(c) that our agreements and MOUs with other departments, Agencies, and organizations be published in the Federal Register on an individual basis and instead will require that they be posted on our Web site as completed. We increasingly rely on Internet-based communications to ensure and promote transparency in our operations and activities. So it is with this final rule, which merely recognizes and codifies our already established practice of making our ongoing agreements and MOUs with other departments, Agencies, and organizations publicly available on our Web site. At the time of this writing, each such publicly disclosable agreement and MOU can be accessed at one of the following three FDA Web site locations: http://www.fda.gov/AboutFDA/PartnershipsCollaborations/MemorandaofUnderstandingMOUs/DomesticMOUs/default.htm; http://www.fda.gov/AboutFDA/PartnershipsCollaborations/MemorandaofUnderstandingMOUs/AcademiaMOUs/default.htm; or http://www.fda.gov/AboutFDA/PartnershipsCollaborations/ MemorandaofUnderstandingMOUs/OtherMOUs/default.htm.

Because all publicly disclosable agreements and MOUs are posted on our Web site, it is no longer necessary to require, as does current § 20.108(b), that a permanent file of them be available for public review during working hours in the Agency's Freedom of Information Public Reading Room. Accordingly, this rule will revise current § 20.108(b).

The public's access to an FDA Web site that is regularly updated to include agreements and MOUs as they are completed has already greatly enhanced the speed, ease, and convenience with which stakeholders can obtain and review these documents.

The rule's technical changes will lessen demands on the time of our staff and reduce the government paperwork and printing costs associated with Federal Register publication of newly completed agreements and MOUs with other departments, Agencies, and organizations. At the same time, it will continue to ensure, consistent with the underlying intent of § 20.108, the accessibility of records of widespread interest to consumers, industry, professional groups, associations, educators, and other government Agencies.

Currently, § 20.108(c) treats our cooperative work-sharing agreements with State or local government Agencies differently from our agreements and MOUs with other Agencies and organizations. Because these cooperative work-sharing agreements rarely vary significantly from one another, we decided against publishing their full texts in the Federal Register (51 FR 19851; June 3, 1986). Instead, since 1993, we have merely required them to be listed at least once every 2 years in the Federal Register (58 FR 48794; September 20, 1993). This final rule will end such disparate treatment. Revised § 20.108(b) will apply to all of our written agreements and MOUs with other departments, Agencies, and organizations, including cooperative work-sharing agreements with State or local government Agencies, except for signed agreements and MOUs relating to activities of our Office of Criminal Investigations, which are addressed in § 20.108(d), which will be revised and redesignated as § 20.108(c).

This final rule does not amend § 20.108(a) (stating that our written agreements and MOUs are available for public disclosure).

We received one comment on the proposed rule. A summary of that comment and FDA's response follow.

(Comment 1) While acknowledging “FDA's efforts to reduce printing costs associated with publication of newly completed” agreements and MOUs, the comment urged that such documents be published in full in the Federal Register , as they constitute “vital aspects of FDA's mission,” and the Federal Register has been designated as the one place where important governmental actions can be found. The comment maintained that the Federal Register embodies a permanently available historical record providing potentially necessary details for recreating Agency thinking or policy at a given time. By contrast, the comment continued, FDA removes obsolete documents from its Web site as it continuously updates it, thereby rendering that Web site unreliable as an Agency historical record. It additionally contended that on numerous occasions when FDA has updated its Web site, information has become difficult to find or links no longer connect to appropriate Web site pages.

(Response) We believe that the burden and costs imposed by Federal Register publication of agreements and MOUs, which include not only the printing costs acknowledged by the comment, but also the time of FDA staff and associated government paperwork, outweigh any arguable interest in reproducing these documents in their entirety in the Federal Register . To the extent that any of these documents are eventually no longer accessible on FDA's Web site, they, like numerous other significant documents that are not reprinted in the Federal Register , constitute permanent Agency records required to be archived and made available to the public on request.

FDA has examined the impacts of the final rule under Executive Order 12866, Executive Order 13563, the Regulatory Flexibility Act (5 U.S.C. 601-612), and the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4). Executive Orders 12866 and 13563 direct Agencies to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). The Agency believes that this final rule is not a significant regulatory action under Executive Order 12866.

The Regulatory Flexibility Act requires Agencies to analyze regulatory options that would minimize any significant impact of a rule on small entities. Because this rule does not impose any significant costs, we certify that it will not have a significant economic impact on a substantial number of small entities.

Section 202(a) of the Unfunded Mandates Reform Act of 1995 requires that Agencies prepare a written statement, which includes an assessment of anticipated costs and benefits, before proposing “any rule that includes any Federal mandate that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100,000,000 or more (adjusted annually for inflation) in any one year.” The current threshold after adjustment for inflation is $139 million, using the most current (2011) Implicit Price Deflator for the Gross Domestic Product. We do not expect this rule to result in any 1-year expenditure that would meet or exceed this amount.

We have concluded that this final rule contains no collection of information. Therefore, clearance by the Office of Management and Budget under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) is not required.

We have determined under 21 CFR 25.33 that this final rule is of a type that does not individually or cumulatively have a significant effect on the human environment. Therefore, neither an environmental assessment nor an environmental impact statement is required.

We have analyzed this final rule in accordance with the principles set forth in Executive Order 13132. We have determined that this final rule does not contain policies 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. Accordingly, we have concluded that this final rule does not contain policies that have federalism implications as defined in the Executive order and, consequently, a federalism summary impact statement is not required.

Therefore, under the Federal Food, Drug, and Cosmetic Act and under authority delegated to the Commissioner of Food and Drugs, 21 CFR part 20 is amended as follows:

I. Background

On December 20, 2010, FDA issued a proposed rule (75 FR 79320) to amend its regulations regarding compounds of carcinogenic concern used in food-producing animals. Specifically, the Agency clarified the definition of “S o ” and revised the definition of “S m ” so that it would conform to the clarified definition of S o . The Agency also proposed a number of clarifying and conforming changes.

The Federal Food, Drug, and Cosmetic Act (the FD&C Act) contains three anticancer, or Delaney, clauses: Sections 409(c)(3)(A), 512(d)(1)(I), and 721(b)(5)(B)(i) (21 U.S.C. 348(c)(3)(A), 360b(d)(1)(I), and 379e(b)(5)(B)(i)), pertaining to food additives, new animal drugs, and color additives, respectively. These clauses prohibit approval of substances that have been shown to induce cancer in man or animals. However, each clause contains an exception, termed the “Diethylstilbestrol (DES) Proviso,” that permits administration of such substances to food-producing animals where: (1) The food additive, color additive, or new animal drug will not adversely affect the animal and (2) no residue of the food additive, color additive, or new animal drug will be found in any edible portion of that animal by a method of examination prescribed or approved by the Secretary of Health and Human Services by regulation. The regulations under part 500 (21 CFR part 500), subpart E entitled “Regulation of Carcinogenic Compounds Used in Food-Producing Animals” (§§ 500.80 through 500.92), implement the DES Proviso. To elaborate on how to determine that there is no residue, and thus demonstrate that the second prong of the DES Proviso has been satisfied, the regulations define several terms, including S o and S m .

S o is currently defined as the concentration of the compound of carcinogenic concern in the total diet of test animals that corresponds to a maximum lifetime risk of cancer to the test animals of 1 in 1 million, and is calculated from tumor data of the cancer bioassays using a statistical extrapolation procedure. The definition of S o also provides that FDA will assume that the S o corresponds to the concentration of residue of carcinogenic concern in the total human diet that represents no significant increase in the risk of cancer to people. The concentration, derived from the S o , of residues of carcinogenic concern in a specific edible tissue is termed the S m .

This rule changes the definition of S o so that it is primarily defined as “the concentration of a residue of carcinogenic concern in the total human diet that represents no significant increase in the risk of cancer to the human consumer * * *” and secondarily as “the concentration of test compound in the total diet of test animals that corresponds to a maximum lifetime risk of cancer in the test animals of 1 in 1 million.” The change in this rule to the definition of S o is intended to enable the Center for Veterinary Medicine to consider allowing the use of alternative procedures to satisfy the DES Proviso (See 75 FR 79320 at 79321) without requiring the development of a second, alternative, set of terminology. FDA believes that the original intent of 21 CFR part 500, Subpart E, as reflected in the preamble to the final rule establishing that regulation, was to place an emphasis on no significant increase in the risk of cancer to the human consumer, rather than on the specific 1 in 1 million risk of cancer to the test animals approach (See e.g., 52 FR 49572 at 49575 and 49582). Therefore, FDA has concluded that the redefinition of S o is consistent with this original intent of the regulation.

For clarification purposes, FDA is also redefining S m in § 500.82 to conform this definition with the redefinition of S o as described previously. Specifically, S m will mean the concentration of a residue of carcinogenic concern in a specific edible tissue corresponding to no significant increase in the risk of cancer to the human consumer. However, the definition of S m will also retain the existing reference to a maximum lifetime risk of cancer in the test animals of 1 in 1 million.

Finally, FDA is amending § 500.84(c) to clarify that for each compound that is regulated as a carcinogen, FDA will analyze the data submitted using either a statistical extrapolation procedure as provided in § 500.84(c)(1) or an alternate approach as provided in § 500.90.

FDA's goal in these changes is to clarify that the terms S o and S m apply even when the alternative procedures provided for in § 500.90 are used to satisfy the DES Proviso, not to alter the usual process for approving compounds of carcinogenic concern. As such, in the absence of a waiver of the requirements of § 500.84(c)(1), FDA maintains that sponsors must meet the conditions for approval set for in § 500.84, including the default approach of a 1 in 1 million lifetime risk to the test animal.

FDA received six comments in response to the proposed rule. Two of these comments were outside the scope of the rule as they advocated in one case that FDA hold a public hearing regarding the drug Avastin®, and the other comment concerned veterinary compounding.

(Comment 1) Of the remaining comments, one generally supported the rule, but mistakenly believed that the rule “will limit carcinogenic compounds in food producing animals to 1 in 1 million.”

In fact, the rule clarifies the definition of S o in 21 CFR 500.82 to mean primarily “the concentration of a residue of carcinogenic concern in the total human diet that represents no significant increase in the risk of cancer to the human consumer * * *” and secondarily, “S o will correspond to the concentration of test compound in the total diet of test animals that corresponds to a maximum lifetime risk of cancer in the test animals of 1 in 1 million.” The rule also clarifies the definition of S m to mean primarily “the concentration of a residue of carcinogenic concern in a specific edible tissue corresponding to no significant increase in the risk of cancer to the human consumer * * *” and secondarily “the concentration of test compound in the total diet of test animals that corresponds to a maximum lifetime risk of cancer in the test animals of 1 in 1 million.”

(Comment 2) A comment from a veterinary association generally supported the rule and its goal to allow the use of alternative procedures to satisfy the DES Proviso without requiring the development of a second, alternative, set of terminology. The comment advocated the use of “statistically valid risk assessment procedures in its evaluation and consideration of the compounds of carcinogenic concern.” The comment continued, “That if alternative procedures are allowed, they should be also definable and data driven.” FDA generally agrees with the comment that an alternative procedure should be definable and data driven in order to be acceptable. However, the recommendation is also outside the current scope of the current rule as it clarifies the definition of S o and S m and will not address alternative procedures.

(Comments 3 and 4) Another commenter opposed the rule, advocating a ban on all carcinogens in animal food, even in minute quantities. A second comment mistakenly stated that the rule “is a proposal to remove any carcinogen from any drugs or feed that are given to animals that are generally eaten by humans.”

As previously stated, the FD&C Act contains three anticancer, or Delaney, clauses: Sections 409(c)(3)(A), 512(d)(1)(I), and 721(b)(5)(B)(i), pertaining to food additives, new animal drugs, and color additives, respectively. These clauses prohibit approval of substances that have been shown to induce cancer in man or animals, with the following exceptions termed the “DES Proviso.” The DES Proviso permits FDA to approve carcinogenic compounds for use in food-producing animals if it concludes that, when used in accordance with its label directions: (1) The compound will not adversely affect the animal; and (2) “no residue” of the compound will be found in any edible portion of the animals using a method of detection prescribed by FDA. FDA's approach to implement the Delaney clause and the DES Proviso is described in part 500, subpart E, entitled “Regulation of Carcinogenic Compounds Used in Food-Producing Animals,” §§ 500.80 through 500.92. As described earlier, the current rule clarifies the definitions within this set of regulations.

The Agency has determined under 21 CFR 25.30(h) that this action is of a type that does not individually or cumulatively have a significant effect on the human environment. Therefore, neither an environmental assessment nor an environmental impact statement is required.

FDA has examined the impacts of the final rule under Executive Order 12866, Executive Order 13563, the Regulatory Flexibility Act (5 U.S.C. 601-612), and the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4). Executive Orders 12866 and 13563 direct Agencies to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). The Agency believes that this final rule is not a significant regulatory action under Executive Order 12866.

The Regulatory Flexibility Act requires Agencies to analyze regulatory options that would minimize any significant impact of a rule on small entities. FDA concluded that the proposed rule would not impose any direct or indirect costs on industry or government through the changes to the definitions of S o and S m and to § 500.84(c), but rather would clarify these definitions to enable FDA to consider using alternative procedures to satisfy the DES Proviso without requiring the development of a second, alternative, set of terminology. FDA did not receive any public comments that challenged this conclusion. As such, FDA certifies that the final rule will not have a significant economic impact on a substantial number of small entities.

Section 202(a) of the Unfunded Mandates Reform Act of 1995 requires that Agencies prepare a written statement, which includes an assessment of anticipated costs and benefits, before proposing “any rule that includes any Federal mandate that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100,000,000 or more (adjusted annually for inflation) in any one year.” The current threshold after adjustment for inflation is $139 million, using the most current (2011) Implicit Price Deflator for the Gross Domestic Product. FDA does not expect this final rule to result in any 1-year expenditure that would meet or exceed this amount.

FDA has analyzed this final rule in accordance with the principles set forth in Executive Order 13132. FDA has determined that the rule does not contain policies 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. Accordingly, the Agency has concluded that the rule does not contain policies that have federalism implications as defined in the Executive order and, consequently, a federalism summary impact statement is not required.

This final rule refers to previously approved collections of information found in FDA regulations. These collections of information are subject to review by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). The collections of information in § 500.84 have been approved under OMB control number 0910-0032.

Therefore, under the Federal Food, Drug, and Cosmetic Act and under authority delegated to the Commissioner of Food and Drugs, 21 CFR part 500 is amended as follows:

Table of Acronyms DHS Department of Homeland Security FR  Federal Register NPRM Notice of Proposed Rulemaking A. Regulatory History and 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 doing so would be impracticable and contrary to the public interest. The final details for this event were not received by the Coast Guard with sufficient time for a comment period to run before the start of the event. Thus, delaying this rule to wait for a notice and comment period to run would be impracticable and contrary to the public interest because it would inhibit the Coast Guard's ability to protect the public from the hazards associated with maritime fireworks displays.

Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register . For the same reasons discussed in the preceding paragraph, waiting for a 30 day notice period to run would be impracticable and contrary to the public interest.

On the evening of August 25, 2012, fireworks will be launched from a point on Marquette Bay to celebrate the Annual Marquette Seafood Festival. The Captain of the Port, Sector Sault Sainte Marie, has determined that the Marquette Seafood Festival Fireworks Display will pose significant risks to the public. The likely congested waterways in the vicinity of a fireworks display could easily result in serious injuries or fatalities.

To mitigate the risks associated with the Seafood Festival Fireworks Display, the Captain of the Port, Sector Sault Sainte Marie will enforce a temporary safety zone in the vicinity of the launch site. This safety zone will encompass all waters of Lake Superior in Marquette Harbor, within the arc of a circle with a 1,000 ft radius from the fireworks launch site located in position 46°32′21.7″ N, 087°23′07.60″ W [DATUM: NAD 83]. The safety zone will be effective and enforced from 9:30 p.m. until 11:30 p.m. on August 25, 2012.

Entry into, transiting, or anchoring within the safety zone is prohibited unless authorized by the Captain of the Port, Sector Sault Sainte Marie, or his or her on-scene representative. The Captain of the Port, Sector Sault Sainte Marie, or his or her on-scene representative may be contacted via VHF channel 16.

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 or executive orders.

This rule is not a significant regulatory action under section 3(f) of Executive Order 12866, Regulatory Planning and Review, as supplemented by Executive Order 13563, Improving Regulation and Regulatory Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order or under section 1 of Executive Order 13563. The Office of Management and Budget has not reviewed it under these Orders. It is not “significant” under the regulatory policies and procedures of the Department of Homeland Security (DHS). We conclude that this rule is not a significant regulatory action because we anticipate that it will have minimal impact on the economy, will not interfere with other agencies, will not adversely alter the budget of any grant or loan recipients, and will not raise any novel legal or policy issues. The safety zone will exist for only a minimal time. Under certain conditions, moreover, vessels may still transit through the safety zone when permitted by proper authority.

The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601-612, as amended, requires federal agencies to consider the potential impact of regulations on small entities during rulemaking. 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 might be small entities: The owners or operators of vessels intending to transit or anchor in a portion of Lake Superior between 9:30 p.m. and 11:00 p.m. on August 25, 2012.

This safety zone will not have significant economic impact on a substantial number of small entities for the following reasons: This rule will only be enforced for a short period of time. Vessels may safely pass outside the safety zone during the event. In the event that this temporary safety zone affects shipping, commercial vessels may request permission from the Captain of the Port, Sector Sault Sainte Marie, to transit through the safety zone. The Coast Guard will give notice to the public via a Broadcast to Mariners that the regulation is in effect.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding the rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section above.

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 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. We have analyzed this rule under that Order and determined that this rule does not have implications for federalism.

The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to contact the person listed in the FOR FURTHER INFORMATION CONTACT section to coordinate protest activities so that your message can be received without jeopardizing the safety or security of people, places or vessels.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Though this 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.

This action is not a “significant energy action” under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use.

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 because it involves the establishment of a safety zone. A final environmental analysis checklist and a categorical exclusion determination are available in the docket where indicated under ADDRESSES . We seek any comments or information that may lead to the discovery of a significant environmental impact from this rule.

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

Throughout this document whenever “we,” “us,” or “our” is used, we mean EPA. The following outline is provided to aid in locating information in this preamble.

On September 20, 2010 (75 FR 57221), EPA published a Notice of Proposed Rulemaking (NPR) for the States of Connecticut, Massachusetts, and Rhode Island. The NPR proposed approval of 2002 base year emission inventories and reasonable further progress emission reduction plans for areas within these states designated as nonattainment of EPA's 1997 8-hour ozone standard. Additionally, the NPR proposed approval of the 2008 motor vehicle transportation budgets and contingency measures associated with the RFP plans. EPA also proposed approval of three rules adopted by Connecticut that will reduce volatile organic compound emissions in the state. In today's final rule we are approving the items for which we proposed approval in the NPR. Today's final rule was originally signed on May 2, 2012, but due to a clerical error was not published.

On April 30, 2004, EPA designated portions of the country as being in nonattainment of the 1997 8-hour ozone national ambient air quality standard (NAAQS) (69 FR 23858). 1 All parts of Connecticut, Massachusetts, and Rhode Island were designated as nonattainment for ozone, and all were classified as moderate. There were five nonattainment areas created that encompassed the entirety of these states, as shown in Table 1.

As discussed in our September 20, 2010 NPR, the Act contains air quality planning and control requirements for ozone nonattainment areas. For more information about these requirements and our evaluation of each state's means of addressing them, please refer to the more detailed analysis presented within the September 20, 2010 NPR.

The Act contains a number of requirements for moderate ozone nonattainment areas. One requirement, found at section 182(a)(1) of the Act and made applicable to moderate ozone nonattainment areas through section 182(b), compels the preparation and submittal of a “comprehensive, accurate, current inventory of actual emissions from all sources.” In August, 2005, EPA published supplemental guidance for states to use in development of their base year inventories entitled, “Emission Inventory Guidance for Implementation of Ozone and Particulate Matter National Ambient Air Quality Standards (NAAQS) and Regional Haze Regulation” (EPA-454/R-05-001). This guidance describes for states the requirements for development of comprehensive emission estimates from stationary point and area sources, and from mobile on-road and non-road sources, such that complete emission inventories are available to support SIP development for the 8-hour ozone standard. Each state complemented these emission estimates from man-made sources with biogenic (naturally occurring) emission estimates from plants, trees, grasses and crops prepared by EPA. The guidance directs states to prepare their emission estimates on a “typical summer day” basis to reflect emissions that occur during high ozone episodes, which occur predominantly during the warm summer months.

As mentioned above, Connecticut, Massachusetts, and Rhode Island all contain ozone nonattainment areas designated as moderate for the 1997 8-hour ozone standard. Therefore, they were required to develop 2002 base year emission inventories of VOC and NO X , as these compounds react in the presence of heat and sunlight to form ozone.

The 2002 VOC and NO X base year inventories prepared by Connecticut, Massachusetts, and Rhode Island are shown below in Tables 2a through 2e. EPA has concluded that these states have adequately derived and documented the 2002 base year VOC and NO X emissions for these areas, and our intention is to approve these inventories into the SIP for each state.

We are approving the 2002 base year inventories listed in Tables 2a through 2e above.

A reasonable further progress (RFP) plan illustrates how an ozone nonattainment area will make emission reductions of a set amount over a given time period. EPA's Phase 2 implementation rule for the 1997 ozone standard interpreted how Section 182(b)(1) of the CAA would apply to areas designated as moderate (or higher) nonattainment of the 1997 8-hour ozone standard. See 40 CFR part 51 subpart X. Of relevance for Connecticut, Massachusetts and Rhode Island is what the Phase 2 rule required for areas with attainment dates greater than 5 years from designation that previously accomplished a 15% reduction in VOC emissions pursuant to one-hour ozone nonattainment requirements, as all three of these states meet these criteria. For such areas, the Phase 2 rule indicates that RFP will be met if the area can demonstrate a 15% reduction in ozone precursor emissions (VOC and/or NO X ) will occur between 2002 and 2008. 2 See 40 CFR 51.910(b)(2)(ii)(A)-(B). These states prepared RFP plans for each of the nonattainment areas shown in Table 1 above, and our September 20, 2010 notice of proposed rulemaking contains a summary of these plans and the results of our evaluation of them.

We are approving the RFP plans submitted by Connecticut, Massachusetts, and Rhode Island for the moderate ozone nonattainment areas shown in Table 1 above, as revisions to these states' SIPs. Note that regarding the NY-NJ-CT moderate area, we are taking action today only on the Connecticut portion of the RFP plan for that area. The VOC and NO X emission target levels and modeled, controlled 2008 emissions for each nonattainment area are shown within Table 3 below.

Note that in Table 3 above, all of the modeled 2008 emission levels are lower than the corresponding 2008 emission target levels with the exception of the Providence area's VOC emissions which are 1.5% higher than the 2008 VOC target. In light of this, Rhode Island allocated an additional 1.5% NO X reduction (which translates to 1.1 tons) to cover this shortfall. Thus, Rhode Island has set its 2008 NO X target to 57.8 tons/day rather than 58.9 tons/day. In essence, Rhode Island has selected a 16.6% reduction in NO X emissions and a 1.5% increase in VOC emissions, resulting in a combined reduction of 15.1%. A more detailed discussion of this is contained within our September 20, 2010 proposal.

Additionally, a typographical error within our September 20, 2010 proposal occurred within step 6 of Table 3d, where the detailed RFP target level calculations for the Springfield area are shown. The error is that the information for step 5 is repeated and appears as step 5 and also as step 6, resulting in the correct information for step 6 not being shown. The correct step 6 information that should have been shown within our September 20, 2010 action for VOC emissions in tons/day is: 100.2 − 5.8 = 94.4; and for NO X emissions, also in tons/day, is: 113.1 − 21.1 = 92.0.

We are approving three VOC control measures from Connecticut. Two of these rules consist of amendments to existing rules. The two amended rules are a solvent metal cleaning rule, located at section 22a-174-20(l) of the Regulations of Connecticut State Agencies, and the second rule is the state's asphalt paving rule, located at 22a-174-20(k) of the Connecticut regulations. We are approving the amended solvent metal cleaning rule and the amended asphalt paving rule as they were submitted to EPA, with the exception of the bracketed text as that language represents regulatory text from a prior version of the rule which Connecticut has retracted. The third rule we are approving is Connecticut's architectural and industrial maintenance (AIM) coatings rule, located at section 22a-174-41 of the Connecticut regulations. The solvent metal cleaning and AIM coatings rules have compliance dates in May of 2008, and so achieve emission reductions that help Connecticut demonstrate compliance with its RFP obligation. The amendment to the asphalt paving rule has a May 1, 2009 compliance date and was submitted to help the state demonstrate that it meets the Clean Air Act section 182(b)(2) requirement that sources in the state use reasonably available control technology (RACT) to control air pollution. We are not taking action on Connecticut's overall RACT or reasonably available control measure (RACM) submittals at this time. Additional details regarding our approval of these three Connecticut rules are available within our September 20, 2010 proposal. Our approval of these rules makes them part of Connecticut's federally enforceable SIP.

Section 172(c)(9) of the CAA requires, in part, that nonattainment areas provide for contingency measures “to be undertaken if the area fails to make reasonable further progress, or to attain the national primary ambient air quality standard by the attainment date applicable under this part.” As noted in our September 20, 2010 proposal, for Connecticut and Massachusetts we are approving each state's use of the surplus emission reductions that are documented within their RFP emission target level calculations.

For Rhode Island, we are approving use of the emission reductions from two stationary source measures as meeting the state's contingency plan requirement. In 2009, Rhode Island adopted VOC control regulations establishing emission limits for consumer and commercial products, and for architectural and industrial maintenance coatings. A public hearing on these proposed rules was held on February 20, 2009, and they were promulgated as final state regulations May 15, 2009, with an effective date of June 4, 2009. Rhode Island submitted these regulations to EPA as SIP revisions, and we approved them in a direct final rule published in the Federal Register on March 13, 2012 (77 FR 14691).

Section 176(c) of the CAA, and EPA's transportation conformity rule at 40 CFR part 93 subpart A, require that transportation plans, programs, and projects conform to state air quality implementation plans. States are required to establish motor vehicle emission budgets in any control strategy SIP that is submitted for attainment and maintenance of the NAAQS. The RFP plans submitted by Connecticut, Massachusetts, and Rhode Island are control strategy SIPs, and they contain 2008 motor vehicle budgets for VOCs and NO X by nonattainment area. Table 4 contains these VOC and NO X transportation conformity budgets in units of tons per summer day:

In today's action, we are approving the 2008 conformity budgets for VOC and NO X for the areas shown in Table 4 above.

Other specific requirements of these state's inventories, RFP plans, and Connecticut's VOC control regulations and the rationale for EPA's proposed action are explained in the NPR and will not be restated here. No public comments were received on the NPR.

EPA is approving 2002 emission inventories and reasonable further progress plans as revisions to the Connecticut, Massachusetts, and Rhode Island SIP. We are also approving the 2008 motor vehicle emission budgets and contingency measures associated with these RFP plans. Additionally, we are approving three Connecticut VOC control regulations, Sections 22a-174-20(k), 22a-174-20(l), and 22a-174-41 as revisions to the Connecticut SIP.

Under the Clean Air Act, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. Accordingly, this action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

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

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

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

• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

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

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

• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

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

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

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

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

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by October 22, 2012. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

Part 52 of Chapter I, Title 40, of the Code of Federal Regulations is amended as follows:

Throughout this document whenever “we,” “us,” or “our” is used, we mean EPA.

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

On February 28, 2012, EPA published a Notice of Proposed Rulemaking (NPR) for the State of New Hampshire. See 77 FR 11809. The NPR proposed approval of the New Hampshire State Implementation Plan (SIP) that addresses regional haze for the first planning period from 2008 through 2018. It was submitted by the New Hampshire Department of Environmental Services (NHDES) on January 29, 2010, with supplemental submittals on January 14, 2011, and August 26, 2011. Specifically, EPA proposed to approve New Hampshire's January 29, 2010 SIP revision, and its supplements, as meeting the applicable implementing regulations found in 40 CFR 51.308. EPA also proposed to approve, and incorporate into the New Hampshire SIP, New Hampshire's regulation Env-A 2300 Mitigation of Regional Haze and a permit for Public Service of New Hampshire (PSNH) Merrimack Station.

A detailed explanation of the requirements for regional haze SIPs, as well as EPA's analysis of New Hampshire's Regional Haze SIP submittal was provided in the NPR and is not restated here.

EPA received a number of comments on our proposal to approve New Hampshire's Regional Haze SIP submittal. Comments were received from NHDES, the U.S. Forest Service, the National Park Service (NPS), and the Sierra Club. The following discussion summarizes and responds to the relevant comments received on EPA's proposed approval of New Hampshire's Regional Haze SIP.

Comment: The U.S Forest Service commented that they are pleased that current permit conditions require Merrimack Station to submit calendar monthly emission rates for the preceding twelve months by December 31, 2014, in order to determine the maximum sustainable rate of control for the facility. In addition, they acknowledged the work that the State of New Hampshire has accomplished and encouraged the State of New Hampshire to continue to reduce regional haze.

Response: EPA acknowledges this comment from the U.S. Forest Service.

Comment: NHDES noted that EPA incorrectly referred to the New Hampshire Air Toxic Control Act, NH Revised Statutes Annotated (RSA) 125-I, and the regulations promulgated thereunder as requiring the installation of the wet flue gas desulfurization (FGD) system for mercury removal on the two coal-fired boilers at PSNH Merrimack Station. The correct citation is NH RSA 125-O, the Multiple Pollutant Reduction Program statute. The sections of the law that specifically address mercury removal and require a FGD system are RSA 125-O:11-18.

Response: EPA agrees that there was an error in the citation of the law requiring the FGD system.

Comment: NPS commented that the Best Available Retrofit Technology (BART) modeling and interpretation did not follow EPA's BART modeling guidelines or the methods recommended by the Mid-Atlantic/Northeast Visibility Union (MANE-VU) States and the Federal Land Managers (FLMs). NPS stated that since only one year of meteorological data was modeled, NHDES should have used the 20% best natural background visibility conditions in the modeling and reported the maximum visibility impact at the Class I areas due to the source's baseline emissions and emissions control options. NPS noted that in NHDES's August 2011 revision, the BART modeling was partially corrected to use the natural background visibility, but still incorrectly reports the visibility impact for the 20% worst days and the 20% best days rather than the single day with the maximum visibility impact. NPS stated that while correcting the modeling results may not change the BART control decisions, EPA should not propose to approve methods and interpretations that are not consistent with the correct applications by the other MANE-VU States and States in other regions. NPS recommended that NHDES and EPA correctly report the maximum visibility impact from the BART units for baseline emissions and emissions control options.

Response: Upon further inspection of the model output, NHDES confirmed that the single day with the maximum visibility impact was used when determining the visibility improvement expected from the installation of potential BART control. The highest impact for the 20% worst natural days was used as the baseline condition for the determination of pre-control visibility impact and post-control visibility impact. The 20% worst natural visibility days were used instead of the 20% best natural visibility days because meteorological conditions prevalent during the 20% best natural visibility days are not conducive for transport from the New Hampshire BART sources to the nearby Class I Areas.

However, in response to the NPS's comment, NHDES did undertake a modeling analysis to rerun the pre- and post-BART emission scenarios using the 20% best natural visibility days as the baseline to determine the greatest visibility impact from the BART sources. 1 As an example of the revised modeling, Table 1 provides the updated visibility improvement in deciviews (dv) expected from the various sulfur dioxide (SO 2 ) control strategies that were assessed for Newington Station NT1 (specifically the lowering of the sulfur content of the fuel oil used).

When using the 20% worst natural visibility days, the days in which the BART unit NT1 actually impacts the visibility in the nearby Class I areas, the visibility improvement between the selected level of SO 2 control (lowering the SO 2 emission limit to the equivalent of requiring 0.5% sulfur fuel oil) and the more stringent level of SO 2 control (lowering the SO 2 emission limit to the equivalent of requiring 0.3% sulfur fuel oil) is 0.06 dv (0.11 dv cumulative). 2 The corresponding visibility improvement using the 20% best natural visibility days is 0.08 dv (0.16 dv cumulative). Thus, the NPS comment has been addressed. EPA finds that the NHDES modeling is consistent with the methods recommended by MANE-VU and the FLMs.

Comment: Sierra Club referenced EPA's proposal to approve the New Hampshire determination that BART for Merrimack is wet scrubbers and a 90% reduction in SO 2 emissions, based on “[c]urrent permit conditions.” Sierra Club asserted that while it is correct that wet scrubbers are BART for Merrimack, the SIP sets far too lax an emission standard for SO 2 . Sierra Club also referenced the BART analysis for Merrimack Station which notes that SO 2 removal efficiencies for wet scrubbers in general range up to 97%, and for “new Flue Gas Desulfurization (FGD) systems * * * the presumptive norm is 95 percent reduction of SO 2 emissions.” Similarly, MANE-VU analysis “recommends [a] limit of 95% reduction in SO 2 emissions.”

Furthermore, Sierra Club included a progress report developed by the operator of Merrimack, which states that the newly-installed scrubbers are actually removing far more than 90% of the SO 2 from the plant's exhaust stream. In the report, PSNH notes that the scrubbers are demonstrating “exceptional success” and that “[s]ulfur dioxide removal from boiler flue-gas is approximately 96-98%.” See Public Service Company of New Hampshire Merrimack Station Scrubber Project Progress Report (March 22, 2012). 3 Sierra Club concludes that there is no justification for the SIP's determination that BART for Merrimack consists of a mere 90% reduction in SO 2 emissions, when the presumptive standard would involve releasing half as much SO 2 , and the facility is already claiming to emit less than a third as much. Sierra Club recommends that BART for Merrimack Station MK2 should involve at least a 97% SO 2 reduction rate.

Response: The installation of the wet scrubber is the result of state legislation requiring the reduction of mercury emissions from Merrimack Station Units MK1 and MK2. 4 The wet scrubber has the co-benefit of reducing SO 2 emissions, a visibility impairing pollutant. The wet scrubber has been configured to maximize the mercury emission reduction. It was not known at the time of the BART determination what the SO 2 control efficiency would be under the current configuration. Current permit conditions require the facility to submit calendar monthly emission rates for the preceding 12 months by December 31, 2014. At that time, New Hampshire will determine the maximum sustainable rate of control. As specified by permit conditions, in no case may this rate be less than 90% control. As supported by preliminary reports, it is expected that the scrubber will provide greater than 90% SO 2 control.

For the MK2 BART determination, NHDES considered the existing control, the wet scrubber which is calibrated for the removal of mercury. NHDES selected an approach that reasonably balances mercury removal with a sustainable level of SO 2 removal. EPA finds that the approach to setting BART level of controls for MK2 taken by New Hampshire is reasonable.

Comment: The Sierra Club noted that, since the BART analysis for Merrimack was based in part on Merrimack's actual historical capacity factors, any increase in Merrimack's capacity factor will result in increased emissions and negative impacts on visibility in ways that the SIP will fail to address. According to Sierra Club, the SIP should therefore be amended to restrict Merrimack's emissions not only on a basis of pollutants-per-MMBtu, but also through reference to Merrimack's actual historical level of operation. Put another way, Sierra Club suggested that the SIP must be revised to restrict Merrimack's operation to the capacity factors relied upon in the BART analysis.

Response: According to the BART Guidelines, 5 when calculating the average cost of control, “The baseline emission rate should represent a realistic depiction of anticipated annual emissions for the source. In general, for the existing sources subject to BART, you will estimate the anticipated annual emissions from a baseline period. In the absence of enforceable emission limitations, you calculate baseline emissions based upon continuation of past practices.” On the other hand, the BART Guidelines require enforceable limitations if the utilization or other parameters used to determine future emissions differ from past practice. See BART Guidelines Section D. Step 4.d (70 FR 39156, 39167, July 6, 2005). The utilization and parameters used in the BART analysis for Merrimack are consistent with baseline conditions and past practices, therefore the parameters used, including capacity factor, are not required to be enforceable. On the point of requiring a lb/MMBtu limit instead of a percent control efficiency limit, the BART guidelines list the presumptive levels in units of lb/MMBtu or a percent reduction, and thus we are approving the State's approach of percent control as being consistent with the guidelines.

Comment: NPS commented that NHDES should have considered Advanced Separated Overfire Air (ASOFA) as an oxides of nitrogen (NO X ) control option for Merrimack Station MK2 in addition to the existing SCR. NPS asserted that the addition of ASOFA would result in a NO X rate of 0.24 lb/MMBtu instead of the proposed 0.30 lb/MMBtu 30-day rolling average. NPS indicated that a 25% NO X reduction would provide 0.5 cumulative deciview of visibility improvement at Acadia National Park, Great Gulf Wilderness Area, and Lye Brook Wilderness Area. NPS reviewed four other coal/lignite-fired cyclone boilers (Kincaid in IL and Leland Olds #2 and Milton R. Young #1 & #2 in ND) that are subject to BART. NPS noted that the Kincaid electrical generating unit (EGU) is already equipped with overfire air (and SCR), and the three cyclone boilers in ND will install ASOFA and Selective Non-Catalytic Reduction (SNCR) as BART. NPS cited the estimated NO X emission reductions from the installation of ASOFA for Leland Olds #2 (LOS2), Milton R. Young #1 (MRY1) and Milton R. Young #2 (MRY2) as 28%, 39.5%, and 37.7%, respectively.

Response: Merrimack Station Unit MK2 is a 320 mega-watt (MW) coal-fired cyclone boiler. MK2 fires bituminous coal rather than lignite used in the units discussed by NPS. Bituminous coal ash becomes fluid at a higher temperature than lignite coal ash. This means that a higher combustion temperature is needed in bituminous coal boilers to ensure coal ash remains fluid and is properly removed from the boiler. Improper removal of coal ash can cause the boiler to plug with coal ash, shutting down combustion or creating unsafe operating conditions, and requiring maintenance for coal ash removal.

The installation of ASOFA would lower the combustion temperature and degrade the performance of the boiler. Due to the different properties of the fuels used, EPA does not agree that Merrimack Station Unit MK2 would achieve the same NO X emission reduction from ASOFA as estimated for the cited units.

In addition, the North Dakota units lacked any NO X control in the BART baseline, therefore the expected visibility improvement at the highest impacted Class I area due to installation of BART control is 2.9 dv for MRY1, 3.379 dv for MRY2, and 3.9 dv for LOS2. See 76 FR 58570 (Sept. 21, 2011). By comparison, Merrimack Station MK2 has an existing SCR. The greatest expected visibility improvement from the installation of ASOFA at MK2, using the NPS estimate of 25% reduction in NO X , would be 0.2 dv at Acadia, 0.2 dv at Great Gulf, and 0.1 dv at Lye Brook. It is unlikely that the projected visibility improvement at these Class I areas would be cost-effective considering the cost of installation of ASOFA, the potential for degraded performance, and the increase in maintenance costs. EPA finds that the NHDES determination that SCR represents BART for Merrimack Station Unit MK2 is reasonable.

Comment: NPS commented that the emission limit for the electrostatic precipitators (ESPs) should reflect the actual capabilities of the units, 0.019 lb total suspended particulate (“TSP”) per MMBtu instead of the proposed limit of 0.08 lb TSP/MMBtu.

Response: The BART Guidelines state “emission limits must be enforceable as a practical matter.” The MANE-VU recommended particulate matter (PM) limit for non-CAIR EGUs, such as MK2, is 0.02-0.04 lb/MMBtu. 6 NHDES decided to provide some level of flexibility to Merrimack Station which has a source subject to BART (MK2) and a source not subject to BART (MK1). MK2 and MK1 will share a stack with the installation of the new FGD. If only MK1 operated, the emission limit required by New Hampshire would represent a decrease of 70.4% from the MK1 emission limit of 0.27 lb/MMBtu. At worst, when only MK2 is operating, the emission limit represents a decrease of 64.8% from the currently permitted limit of 0.227 lb/MMBtu. The emission limit chosen by New Hampshire also results in a lower emission rate from the combined units than if New Hampshire had only required MK2 to meet the limit suggested by MANE-VU. 7 Therefore New Hampshire's proposed BART control limit for PM is consistent with the MANE-VU recommended emission limit while providing flexibility to operate a shared stack. Considering the current controls on emissions from Merrimack Station—two ESPs in series—as well as the reductions guaranteed by New Hampshire's limits, EPA finds that NHDES was reasonable in establishing the TSP emission limit for MK2.

Comment: The Sierra Club commented that the New Hampshire haze SIP proposes that an emission limit of 0.08 lbs TSP/MMBtu comports with BART. However, the Sierra Club indicated that this limit is much higher than what is achievable by the PM controls at Merrimack and with BART. The Sierra Club cited the MANE-VU analysis which recommends a “particulate matter limit of 0.02-0.04 lb/MMBtu” for Merrimack unit MK2. Similarly, the Merrimack BART Analysis noted that stack tests for Merrimack have recorded actual PM emissions of as low as 0.021 lbs TSP/MMBtu. The Sierra Club concluded that this would support a determination that an appropriate BART limit for Merrimack would be 0.02 lbs TSP/MMBtu. However, the SIP proposes an emission limit of 0.08 lbs TSP/MMBtu for both units which would result in emissions “less than the total allowable TSP emissions * * * in which a limit for Unit MK2 were revised to 0.04 lb/MMBtu and the limit for Unit MK1 remained unchanged.” The Sierra Club acknowledged that while salutary—and potentially necessary to ensure that New Hampshire meets its reasonable progress goals—the Sierra Club does not think the implementation of a limit for unit MK1 has any bearing on what BART-derived limit is consistent with what is “achievable through the application of the best system of continuous emission reduction” for MK2. Sierra Club stated that New Hampshire may not quadruple the emissions from a BART-eligible unit and call it BART just because it also proposes to limit emissions from another source elsewhere. The limits applicable to MK2 are derived from what may be achieved from the best available retrofit technology. Here, that technology supports an emissions limit of 0.02 lbs TSP/MMBtu; Sierra Club indicated that this limit, and not 0.08 lbs TSP/MMBtu, should be set as BART in the SIP. In addition, to ensure that particulate matter emission reductions are being achieved, the Sierra Club commented that the SIP should require continuous emissions monitoring for particulate matter.

Response: With the installation of the FGD, MK1 and MK2 share a common stack and the EPA finds that NHDES has acted reasonably in setting an emission limit that accounts for, and reduces, emissions from both units. The permit conditions require stack testing post emission controls, and therefore the TSP emissions from MK1 must be considered when developing the TSP emission limit for MK2. Sierra Club has incorrectly characterized New Hampshire's Regional Haze SIP as allowing emissions from a BART-eligible unit to quadruple. As noted in the response above, even under the worst case scenario where only MK2 is operating, New Hampshire's approach results in a decrease of approximately 65% TSP. Assuming dual operation of MK1 and MK2, New Hampshire's approach results in nearly 100 lb TSP/hr less than the limit MANE-VU, and Sierra Club, recommend.

As to the Sierra Club suggestion of requiring a CEM for particulate matter, current federally enforceable permit conditions require the continuous operation of the existing ESPs. While emission limits must be enforceable as a practical matter, the BART Guidelines clearly state that continuous emission monitors (CEMs) are not required in every instance. See 70 FR 39172, July 6, 2005. Moreover, the BART Guidelines recognize that monitoring requirements are in many instances governed by other regulations, such as compliance assurance monitoring.

EPA reiterates that New Hampshire has reasonably developed a control level of MK2 that provides for significant emissions reductions and operational flexibility. 8

Comment: Sierra Club commented that the SIP does not explicitly include requirements for continuous operation of either the PM or SO 2 controls.

Response: With respect to SO 2 controls, the operating permit submitted as part of the New Hampshire haze SIP states, “Beginning on July 1, 2013, the Owner shall not operate MK2 unless MK2-PC7 (the scrubber) is in operation.”  9 EPA proposed to approve this permit and incorporate it into the SIP on Feb 28, 2012. See 77 FR 11809. EPA is approving this permit in today's action. With respect to PM controls, as discussed in the previous response, the existing federally enforceable Title V permit requires continuous ESP operation to meet permit limits. 10

Comment: The Sierra Club observed that much of the New Hampshire haze SIP is based on modeling and other determinations developed as part of the MANE-VU regional planning organization analysis incorporating pollution and visibility data from a wide range of states and tribal entities. MANE-VU member state and tribal governments include: Connecticut, Delaware, the District of Columbia, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Penobscot Indian Nation, Rhode Island, and Vermont. Sierra Club noted that implicit in the New Hampshire haze SIP is the understanding that each individual entity within MANE-VU will achieve the reductions specified for each jurisdiction. Accordingly, the limits and goals for reasonable progress determined in the New Hampshire SIP are based on the reductions in other jurisdictions being met.

Sierra Club asserted that not all MANE-VU jurisdictions are, in fact, on target to meet their reductions. According to Sierra Club, to the extent that the assumptions underpinning the reasonable progress goals in the New Hampshire haze SIP are thereby impacted, the accuracy of the analysis in the SIP should be re-examined.

Response: The EPA notes that the Regional Haze Rule (RHR) requires States to determine what constitutes reasonable progress by, among other things, consideration of the four statutory factors. The RHR states that the determination of what constitutes reasonable progress can only be made once the necessary technical analyses of emissions, air quality, and the reasonable progress factors have been conducted. See 64 FR 35721, July 1, 1999. The RHR states the following: “Once a State has adopted a reasonable progress goal and determined what progress will be made toward that goal over a 10-year period, the goal itself is not enforceable. All that is `enforceable' is the set of control measures which the State has adopted to meet that goal. If the State's strategies have been implemented but the State has not met its reasonable progress goal, the State could either: (1) Revise its strategies in the SIP for the next long-term strategy period to meet its goal, or (2) revise the reasonable progress goals for the next implementation period. In either case, the State would be required to base its decisions on appropriate analyses of the statutory factors included in 40 CFR 51.308(d)(1)(i)(A) and (B) of the final rule.” See 64 FR 35733, July 1, 1999.

Consistent with 40 CFR 51.308(g), New Hampshire has committed to submit to EPA a progress report, in the form of a SIP revision, every five years following the initial submittal of the SIP. The report will evaluate the progress towards the reasonable progress goal for each mandatory Class I area located within the State and in each mandatory Class I area located outside the State that may be affected by emissions from within the State. At this time, New Hampshire will also determine the adequacy of the existing implementation plan. See 40 CFR 51.308(h).

Sierra Club is correct to point out that implementation of the regional haze program in one State is to a certain extent interconnected with implementation in other States. However, requiring constant revision to modeled emission levels prior to implementation would create indecisiveness and gridlock and would stall implementation of emissions reductions. EPA adopted the above mentioned aspects of the Regional Haze Rule to allow adjustments of State planning goals during, and at the end of, each planning period to account for any discrepancies between projected and actual emissions reductions both within the State and from other States. EPA disagrees with Sierra Club and does not find that New Hampshire must reevaluate the modeling in its SIP at the present time.

Comment: NPS commented that NHDES is not proposing emission reductions sufficient to meet the MANE-VU ask. The FLMs disagree with EPA's proposal to approve New Hampshire's plan and recommend the EPA disapprove the New Hampshire plan because it does not meet the reasonable progress goals set by New Hampshire.

Response: New Hampshire, in cooperation with the MANE-VU States, developed the MANE-VU “Ask” that will provide for reasonable progress towards achieving natural visibility at the MANE-VU Class I areas. The “Ask” consists of: (a) Timely implementation of BART requirements; (b) a 90 percent reduction in SO 2 emissions from each of the EGU stacks identified by MANE-VU comprising a total of 167 stacks; (c) adoption of a low sulfur fuel oil strategy; and (d) continued evaluation of other control measures to reduce SO 2 and NO X emissions. While New Hampshire is not adopting a low sulfur fuel oil strategy as part of this submittal, it is expected that the FGD for Merrimack Station MK1 and MK2 will provide greater than 90% SO 2 control. In addition, SO 2 emissions in New Hampshire have been reduced through the conversion of coal-fired Unit 5 at Schiller Station to a biomass-firing unit and the shutdown of Fraser LLC pulp and paper mill. 11 The reasonable progress goal developed by New Hampshire, along with the other MANE-VU States is a goal and not in of itself enforceable. As noted in the above response, New Hampshire will have the opportunity to assess the reasonable progress goals and the State's control strategies as part of the 5-year review. EPA reiterates that the SO 2 emission reductions included in the New Hampshire Regional Haze SIP are comparable to reductions from the MANE-VU “Ask” and will be sufficient to assure progress toward the natural visibility goal for the New Hampshire Class I areas for the first planning period.

Comment: The Sierra Club commented that the MANE-VU four factor analysis for reasonable progress determined that “reductions in SO 2 emissions from EGU and non-EGU industrial point sources will result in the greatest improvements in visibility in the MANE-VU region, more than any other visibility-impairing pollutant.” See 77 FR 11816, February 28, 2012. MANE-VU thus recommended a 90% reduction in SO 2 emissions from EGU emissions points. The Sierra Club indicated that PSNH Schiller Station in Portsmouth, New Hampshire, is one of the largest sources of SO 2 pollution in New Hampshire, emitting 3,549 tons of SO 2 in 2009 and 1,706 tons in 2010, according to EPA's Clean Air Markets Database. The Sierra Club also stated that in recent years, Schiller is emitting SO 2 at levels below historical norms for operation of the facility and credited this emission reduction to the recent economic downturn.

Sierra Club continued that while this emission reduction results in less haze-causing air pollution in New Hampshire, the temporary emissions reductions owing to the economic downturn and attendant diminished output capacity at Schiller will not be permanent. Thus, Sierra Club concluded that if these capacities are relied upon in reasonable progress determinations for the New Hampshire Class I areas, they must be made enforceable, with permit conditions limiting the hours of operation or automatically requiring additional controls in the event that specific annual usage is exceeded. This is critical given the historic fluctuations in emission levels at Schiller.

Sierra Club also stated that to the extent that the decreased SO 2 emissions are due to Schiller's conversion of one of its coal-fired boilers to burn biomass, these reductions should be made enforceable by requiring that Schiller not burn any coal in that boiler. Otherwise, should economic conditions change or Schiller's operator change its mind about what it would like to burn in that boiler, the visibility gains factored into the SIP's reasonable progress planning would be jeopardized.

Response: As noted above, the “Ask” calls for a 90% reduction in SO 2 emissions from the top 167 impacting electrical generating units (EGUs). MANE-VU modeling did not indicate that units at Schiller Station were amongst the highest contributors to visibility impairment at any nearby Class I area. 12 The modeling was conducted using 2002 emissions, prior to any economic downturn.

As indicated by Sierra Club, in 2006, Public Service of New Hampshire converted one of the three 50 MW units from coal burning to biomass burning. The permit modification to convert to biomass burning was undertaken through the federally approved permit process and any modification that increases emissions above the applicable level would require a federally approved permit. EPA relied upon this conversion to biomass, and the related emissions reductions, and not on any decreased utilization of other units at Schiller in evaluating New Hampshire's plans to achieve reasonable progress.

Comment: NPS observed that EPA states in the NPR: “New Hampshire relied on emission reductions from a number of ongoing and expected air pollution control programs as part of the State's long term strategy. For electrical generating units (EGUs), New Hampshire's Regulation Chapter Env-A 3200, NO X Budget Trading Program limits ozone season NO X emissions on all fossil-fuel fired EGUs greater than 15 MW located in Hillsborough, Merrimack, Rockingham, and Strafford Counties to 0.15 lb/MMBtu. However, a unit can meet this limit via NO X credits.”

The NPS commented that Clean Air Markets data indicates that MK1 is not meeting the 0.15 lb/MMBtu target. NPS noted that since New Hampshire is not included in the NO X State Implementation Plan Call, the Clean Air Interstate Rule, or the Cross State Air Pollution Rule, the NPS is not aware of any NO X trading approach that NHDES is relying on to meet the 0.15 lb/MMBtu target. In the absence of any discussion by NHDES or EPA regarding additional control of emissions from MK1, the NPS can only state that a four-factor reasonable progress analysis is required, and NPS believes it is likely that they would have similar comments regarding SO 2 and NO X emissions from MK1 as they do for MK2.

Response: NHDES and MANE-VU undertook a four factor analysis for reasonable progress. MANE-VU identified SO 2 as the main contributor to visibility impairment for this first planning period. The result of the four factor analysis was the MANE-VU “Ask.” As part of the MANE-VU “Ask,” New Hampshire agreed to require MK1 to reduce SO 2 emissions by 90%. The operating permit submitted as part of the New Hampshire SIP requires MK1 to meet at least 90% reduction with the installation of the wet scrubber. 13

NPS is correct that New Hampshire is not part of the NO X State Implementation Plan Call, the Clean Air Interstate Rule, or the Cross State Air Pollution Rule. However, New Hampshire was included in the earlier NO X Budget Program that was developed via a Memorandum of Understanding of the Ozone Transport Commission. See 65 FR 68078 (March 9, 2000). Since New Hampshire was not included in the subsequent trading programs, New Hampshire's program is for all intents and purposes an intrastate NO X credit trading program. The New Hampshire NO X Budget program requires MK1 to meet an ozone season emission limit of 0.15 lb/MMBtu or 75% NO X control from the 1990 baseline, whichever is less stringent. NPS is correct in that MK1 is not meeting an ozone season emission limit of 0.15 lb/MMBtu, but is meeting 75% NO X control from the 1990 baseline.

In addition to the ozone season NO X Budget Program, MK1 is subject to the NO X Reasonably Achievable Control Technology (RACT) program. Pursuant to RACT Order ARD-97-001 issued in accordance with New Hampshire's Env-A 1211 which was approved into the SIP on July 23, 2002 (67 FR 48033), MK1 is required to meet 18.1 tons NO X per 24-hour calendar day when MK2 is not in full operation and 29.1 tons per calendar day when combined with MK2.

EPA is approving New Hampshire's January 29, 2010 SIP revision and supplemental submittals on January 14, 2011 and August 26, 2011, as meeting the applicable implementing regulations found in 40 CFR 51.308. EPA is also approving, and incorporating into the New Hampshire SIP, New Hampshire's regulation Env-A 2300 Mitigation of Regional Haze and PSNH Merrimack Station Temporary Permit TP-0008 Flue Gas Desulfurization System dated March 9, 2009, and reissued August 2, 2010, and July 8, 2011.

Under the Clean Air Act, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve State choices, provided that they meet the criteria of the Clean Air Act. Accordingly, this action merely approves State law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

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

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

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

• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

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

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

• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

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

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

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

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

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by October 22, 2012. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See Section 307(b)(2).)

40 CFR part 52 is amended as follows:

Throughout this document whenever “we,” “us,” or “our” is used, we mean EPA.

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

New Hampshire adopted regulations to limit particulate matter, visible emissions, and fugitive emissions from hot mix asphalt plants in 1995. In 2002, EPA approved Chapter Env-A 1200 “Prevention, Abatement, and Control of Stationary Source Air Pollution,” Part Env-A 1207 “Asphalt Plants” into the New Hampshire State Implementation Plan (67 FR 48033). Env-A 1207 has since been recodified as Env-A 2700.

On July 27, 2004, the New Hampshire Department of Environmental Services (NH DES) proposed revisions to Env-A 2700 “Hot Mix Asphalt Plants” and held a public hearing on September 15, 2004. Subsequently, NH DES amended Env-A 2700 based on comments received from EPA and others, and adopted the regulation revisions on November 19, 2004, with an effective date of November 24, 2004. On January 28, 2005, NH DES submitted these revisions to EPA for inclusion in the New Hampshire SIP. EPA's review of the SIP submittal indicates that EPA comments on the revisions to Env-A 2700 have been adequately addressed.

At this time, EPA is only approving the New Hampshire SIP revision for Env-A 2703.02(a). EPA will take action on the remainder of Env-A 2700 at a later date. Please note that if EPA receives adverse comment on an amendment, paragraph, or section of this rule and if that provision may be severed from the remainder of the rule, EPA may adopt as final those provisions of the rule that are not the subject of an adverse comment.

On January 28, 2005, NH DES submitted to EPA amendments to Env-A 2700 Hot Mix Asphalt Plants. The rule presently in the New Hampshire SIP (Env-A 1207.02) applies to pre-June 1974 asphalt plants and provides an alternate opacity limit (60 percent opacity, No. 3 on the Ringelmann Smoke Chart) for a specified time period (3 minutes per startup). This provision did not meet all of EPA's policy requirements for source-specific startup and shutdown emission limits (EPA memorandum, September 20, 1999, “State Implementation Plans: Policy Regarding Excess Emissions During Malfunctions, Startup, and Shutdown”).

NH DES has recodified and replaced Env-A 1207.02 with Env-A 2703.02 (“Visible Emission Standards for Hot Mix Asphalt Plants”). Env-A 2703.02(a) states that “The owner or operator of a hot mix asphalt plant shall not cause or allow visible fugitive emissions or visible stack emissions to exceed an average of 20 percent opacity for any continuous 6-minute period” with no exemptions. The revised rule applies to all hot mix asphalt plants regardless of construction date. Thus, the revised rule is more stringent than current SIP requirements, is consistent with EPA's policy, and meets the section 110(l) anti-backsliding requirements of the Clean Air Act.

At this time EPA is not taking action on provisions of Chapter Env-A 2700 other than Env-A 2703.02(a). EPA intends to take action on the remainder of Env-A 2700 in the near future.

EPA is approving amendments to the New Hampshire Hot Mix Asphalt Plant Rule at Env-A 2703.02(a) into the New Hampshire SIP. EPA has determined that the revised Env-A 2703.02(a) meets the applicable requirements of section 110 of the Clean Air Act.

The EPA is publishing this action without prior proposal because the Agency views this as a noncontroversial amendment and anticipates no adverse comments. However, in the proposed rules section of this Federal Registe r publication, EPA is publishing a separate document that will serve as the proposal to approve the SIP revision should relevant adverse comments be filed. This rule will be effective October 22, 2012 without further notice unless the Agency receives relevant adverse comments by September 21, 2012.

If the EPA receives such comments, then EPA will publish a notice withdrawing the final rule and informing the public that the rule will not take effect. All public comments received will then be addressed in a subsequent final rule based on the proposed rule. The EPA will not institute a second comment period on the proposed rule. All parties interested in commenting on the proposed rule should do so at this time. If no such comments are received, the public is advised that this rule will be effective on October 22, 2012 and no further action will be taken on the proposed rule. Please note that if EPA receives adverse comment on an amendment, paragraph, or section of this rule and if that provision may be severed from the remainder of the rule, EPA may adopt as final those provisions of the rule that are not the subject of an adverse comment.

Under the Clean Air Act, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. Accordingly, this action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

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

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

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

• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

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

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

• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

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

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

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

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by October 22, 2012. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. Parties with objections to this direct final rule are encouraged to file a comment in response to the parallel notice of proposed rulemaking for this action published in the proposed rules section of today's Federal Register , rather than file an immediate petition for judicial review of this direct final rule, so that EPA can withdraw this direct final rule and address the comment in the proposed rulemaking. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

Part 52 of chapter I, title 40 of the Code of Federal Regulations is amended as follows:

Throughout this document whenever “we,” “us,” or “our” is used, we mean the EPA. Information is organized as follows:

In the CAA Amendments of 1977, Congress established a program to protect and improve visibility in the national parks and wilderness areas. See CAA section 169A. Congress amended the visibility provisions in the CAA in 1990 to focus attention on the problem of regional haze. See CAA section 169B. EPA promulgated regulations in 1999 to implement sections 169A and 169B of the Act. These regulations require states to develop and implement plans to ensure reasonable progress toward improving visibility in mandatory Class I Federal areas  1 (Class I areas). 64 FR 35714 (July 1, 1999); see also 70 FR 39104 (July 6, 2005) and 71 FR 60612 (October 13, 2006).

On behalf of the State of Oregon, the Oregon Department of Environmental Quality (ODEQ) submitted its Regional Haze State Implementation Plan (Regional Haze SIP submission or SIP submittal) to EPA on December 10, 2010 and supplemented it on February 1, 2011. In a previous action EPA approved certain provisions in Oregon's Regional Haze SIP submission. 76 FR 38997. This previous action approved the BART provisions (40 CFR 51.308(e), calculation of baseline and natural conditions (40 CFR 51.308(d)(2)), and state wide emission inventory of pollutants that are reasonably anticipated to cause or contribute to visibility impairment in any mandatory Class I area. EPA also approved Oregon Administrative Rules OAR 340-223-0010 through 340-223-0080 (Regional Haze Rules). In that same action, EPA also approved portions of the SIP submittal as meeting the requirements of CAA section 110(a)(2)(D)(i)(II) with respect to the visibility prong for the 1997 8-hour ozone and 1997 PM 2.5 National Ambient Air Quality Standards (NAAQS).

In a proposed rule published on May 23, 2012, EPA proposed approving the remaining provisions of Oregon's Regional Haze SIP submission, the regional haze requirements for establishing RPGs and developing a LTS. 76 FR 38997. A detailed explanation of the Regional Haze Rule including the requirements relating to the reasonable progress goals and long term strategy, ODEQ's reasonable progress goals and long term strategy, and EPA's reasons for approving this SIP revision were provided in the notice of proposed rulemaking on May 23, 2012, and will not be restated here. See 77 FR 30454. The public comment period for this proposed rule ended on June 22, 2012. EPA did not receive any comments on the proposal.

EPA is approving the remaining portions of the Regional Haze SIP submittal from the State of Oregon, submitted on December 10, 2010 and supplemented on February 1, 2011, as meeting the remaining regional haze requirements that require states to prevent any future and remedy any existing visibility impairment in mandatory Class I areas caused by emissions of air pollutants from numerous sources located over a wide geographical area. See CAA section 169A and B and Federal Regulations in 40 CFR 51.308. Specifically included is EPA's approval of the RPGs established by Oregon and the elements of its LTS which include: (1) Ongoing Air Pollution Control Programs, (2) Measures to Mitigate Impacts of Construction Activities, (3) Emission Limitations and Schedules for Compliance, (4) Source Retirement and Replacement Schedules, (5) Smoke Management Techniques for Agricultural and Forestry Burning, and (6) Enforceability of Emission Limitations and Control Measures.

Oregon has not demonstrated authority to implement and enforce the Oregon Administrative rules within “Indian Country” as defined in 18 U.S.C. 1151. “Indian country” is defined under 18 U.S.C. 1151 as: (1) All land within the limits of any Indian reservation under the jurisdiction of the United States Government, notwithstanding the issuance of any patent, and including rights-of-way running through the reservation, (2) all dependent Indian communities within the borders of the United States, whether within the original or subsequently acquired territory thereof, and whether within or without the limits of a State, and (3) all Indian allotments, the Indian titles to which have not been extinguished, including rights-of-way running through the same. Under this definition, EPA treats as reservations trust lands validly set aside for the use of a Tribe even if the trust lands have not been formally designated as a reservation. Therefore, this SIP approval does not extend to “Indian Country” in Oregon. See CAA sections 110(a)(2)(A) (SIP shall include enforceable emission limits), 110(a)(2)(E)(i) (State must have adequate authority under State law to carry out SIP), and 172(c)(6) (nonattainment SIPs shall include enforceable emission limits).

Under the Clean Air Act, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. Accordingly, this action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

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

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

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

• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

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

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

• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

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

• Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994). In addition, this rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law. Consistent with EPA policy, EPA nonetheless provided a consultation opportunity to Tribes in Idaho, Oregon and Washington in letters dated January 14, 2011. EPA received one request for consultation, and we have followed-up with that Tribe.

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

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by October 22, 2012. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2)).

40 CFR part 52 is amended as follows:

You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:

• Dairy Cattle Milk Production (NAICS code 11212).

• Food manufacturing (NAICS code 311).

• Beverage Manufacturing (NAICS code 3121).

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 .

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-2011-0950 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 October 22, 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-2011-0950, by one of the following methods:

• Federal eRulemaking Portal: http://www.regulations.gov . Follow the online instructions for submitting comments. Do not submit electronically any information you consider to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statue.

• Mail: OPP Docket, Environmental Protection Agency Docket Center (EPA/DC), Mail Code: 28221T, 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001.

• Hand Delivery: To make special arrangements for hand delivery or delivery of boxed information, please follow the instructions at http://www.epa.gov/dockets/contacts.htm .

In the Federal Register of December 8, 2011 (76 FR 76674) (FRL-9328-8), 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 0F7758) by Lonza Inc., 90 Boroline Road, Allendale NJ 07401. The petition requested that 40 CFR 180.940(a), be amended by establishing concentration limits for DDACB in end use solutions eligible for tolerance exemption. That notice referenced a summary of the petition prepared by Lonza Inc., the registrant, which is available in the docket, 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 requires 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 * * *.”

Consistent with FFDCA section 408(c)(2)(A), and the factors specified in FFDCA section 408(c)(2)(B), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure for DDACB including exposure resulting from the exemption established by this action. EPA's assessment of exposures and risks associated with DDACB follows.

Consistent with section 408(b)(2)(D) of FFDCA, 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. The nature of the toxic effects caused by DDACB, part of the Aliphatic Alkyl Quaternary group of compounds, are discussed in this unit. In assessing the proposed toxicity, the toxicological endpoints were extracted from the DDAC RED (EPA-HQ-2006-0338).

The Aliphatic Alkyl Quaternaries are corrosive and highly irritating to the eye and skin, with moderate acute toxicity by oral, dermal, and inhalation routes of exposure. These chemicals are classified as “not likely” to be human carcinogens based on negative carcinogenicity in rat and mouse feeding studies using doses above the limit dose. There is no evidence of these chemicals being associated with increased susceptibility of infants and children based on two developmental toxicity studies and a 2-generation reproductive toxicity study. Lastly, they are negative for mutagenicity and neurotoxicity. Specific information on the studies received and the nature of the toxic effects from the toxicity studies can be found at http://www.regulations.gov . Docket ID Number EPA-HQ-OPP-2005-0338 Toxicology Disciplinary Chapter for the Reregistration Eligibility Decision (RED) for Didecyl Dimethyl Ammonium Chloride (DDAC).

For hazards that have a threshold below which there is no appreciable risk, the dose at which no adverse effects are observed (NOAEL) from the toxicology study identified as appropriate for the risk assessment is used to estimate the toxicological level of concern (LOC). However, the lowest dose at which adverse effects of concern are identified (the LOAEL) is sometimes used for risk assessment if no NOAEL was achieved in the toxicology study selected. An uncertainty factor (UF) is applied to reflect uncertainties inherent in the extrapolation from laboratory animal data to humans and in variations in sensitivity among members of the human population as well as other unknowns.

A detailed discussion of EPA's conclusions regarding the toxic endpoints for the Aliphatic Alkyl Quaternaries can be found at 73 FR 37852, July 2, 2008.

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

1. Food. In evaluating dietary exposure to DDACB, EPA considered exposure under the petitioned-for exemption as well as all existing aliphatic alkyl quaternaries exemptions or tolerances in (40 CFR 180.940(a)). EPA assessed dietary exposures from DDACB in food as follows:

Aliphatic alkyl quaternaries are to be used as sanitizers on appliances, beverage bottling, counter tops, food packaging, refrigerators, tables, and utensils. The use of these actives in antimicrobial products for use on food or feed-contact surfaces and in agricultural premises may result in pesticide residues in human food. Residues from treated surfaces, such as appliances, countertops, equipment, and utensils can migrate to food coming into contact with the treated and rinsed surfaces and can be ingested by humans.

The Agency assessed acute and chronic dietary exposures from the use of DACB as a disinfectant and food-contact sanitizer on utensils, countertops, and in food/beverage processing facilities. The assessment calculated the Daily Dietary Dose (DDD) and the Estimated Daily Intake (EDI) using modified Food and Drug Administration (FDA) methodologies for utensils and the Indirect Dietary Residential Exposure Model (IDREAM) for countertops.

The EDI calculations presented in this assessment for treated indirect dietary exposures resulting from sanitizing utensils assumed that food would contact 4,000 cm 2 (which represents contact with treated china, glass, and silverware used by an individual who regularly eats three meals per day at an institutional or public facility) and that the residual solution remaining on the surface or pesticide migration fraction is 1 milligram/centimeter (mg/cm 2 ) of treated area. The body weights used for this assessment were 70 kilograms (kg) for an adult male, 60 kg for an adult woman, and 10 kg for an infant. Based on data provided in a new residue study, Transferability Equivalence among Quats and Measured Food Surrogate Transfer Efficiency (Master Record Identification Number 46870703), a conservative transfer rate of 43% was used to demonstrate the amount of residues on the surface that will be transferred to food and subsequently ingested. The maximum application rate for DDACB on utensils is 0.0033 lbs active ingredient (a.i.) per gallon of treatment solution.

There are two levels of refinement for assessing dietary exposure to antimicrobial products used on countertops. The three dimensional approach, Tier 2, was utilized for this assessment. This conservative approach uses food consumption and preparation patterns, food-specific conversion factors that relate the surface area contacting the countertop with the corresponding weight of the food item, transfer efficiency, and likelihood of contact with a countertop. Food ingredients, as presented in the model, are separated into nine categories and reflect a person's daily diet. Based on the structure of the model, available countertop residues are estimated and presented as the amount of residue that is expected to be available for each of the nine food categories. These calculated available residues are then combined with the food consumption rate, as extracted from the USDA Continuing Survey for Food Intake by Individuals (CSFII) consumption data, and a total daily exposure value is provided as the output. This value is then compared to the toxicological endpoint to determine risk to those consuming foods that have come into contact with a freshly sanitized countertop.

For the assessment of the food bottling/packaging use, EPA assumed a 100% transfer rate because the food is potentially in contact with the treated surfaces for very long periods of time. The maximum application rate for DDACB for bottling/packing of food is 0.0033 lbs a.i. per gallon of treatment solution. EDI values were calculated using an approach similar to that used for treated food utensils. Exposure was assumed to occur through the ingestion of three food products that might be packaged with treated material: Beverages (alcoholic and non-alcoholic), egg products, and milk. A calorie intake modification factor of 0.64 was applied to the EDI for a child to account for the differences between intake values among children and adults.

2. Drinking water exposure. DDACB outdoor uses are as an algaecide in wood preservative treatment and a slimicide in secondary oil field uses. The oil field uses are considered to be contained. The other uses are not expected to significantly contaminate drinking water sources. Therefore, the DDACB contributions for drinking water exposure are considered to be negligible and are not quantified.

The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure (e.g., textiles (clothing and diapers), carpets, swimming pools, and hard surface disinfection on walls, floors, tables). DDACB is currently registered for the following residential non-dietary sites: Homes and day-care nurseries. EPA assessed residential exposure using the following assumptions:

• Residential exposure may occur during the application as well as post application of DDACB to indoor hard surfaces (e.g., mopping, trigger pump sprays, wiping).

• The residential handler scenarios were assessed to determine dermal and inhalation exposures.

• Residential post application scenarios such as children's exposure to treated toys and floors were also assessed to determine dermal and incidental oral exposures.

• Surrogate dermal, inhalation, and incidental oral unit exposure values were estimated using Pesticide Handler Exposure Database (PHED) data and the Chemical Manufactures Association Antimicrobial Exposure Assessment Study (EPA, 1999). Note that for this assessment, EPA assumed that residential users complete all elements of an application (mix/load/apply) without the use of personal protective equipment.

• The duration for most residential exposures is believed to be best represented by the short-term duration (1 to 30 days). The short-term duration was chosen for this assessment because the residential handler and post-application scenarios are assumed to be performed on an episodic, not daily basis.

Specific information on the residential exposure assessment for DDACB can be found at http://www.regulations.gov . Docket ID Number EPA-HQ-OPP-2006-1024, Review of Petition to Amend 40 CFR 180.940 to add Didecyl Dimethyl Ammonium Carbonate/Bicarbonate.

1. In general. Section 408 of FFDCA 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 data base on toxicity and EPA determines based on reliable data that a different margin of safety will be safe for infants and children. This additional margin of safety is commonly referred to as the Food Quality Protection Act (FQPA) safety factor (SF). In applying this provision, EPA either retains the default value of 10X when reliable data do not support the choice of a different factor, or, if reliable data are available, EPA uses a different additional FQPA safety factor value based on the use of traditional uncertainty/safety factors and/or special FQPA safety factors, as appropriate.

2. Prenatal and postnatal sensitivity. There is no evidence that Aliphatic Alkyl ammonium chloride quaternaries result in increased susceptibility in in utero rats or rabbits in the prenatal developmental studies or in young rats in the 2-generation reproduction study.

3. Conclusion. EPA has determined that reliable data show that it would be safe for infants and children to reduce the FQPA safety factor to 1X except for assessments addressing inhalation exposure. For inhalation exposure assessments the 10X FQPA safety factor is retained. Those decisions are based on the following findings:

i. The toxicity database for Aliphatic Alkyl Quaternaries is complete except for a 90-day inhalation toxicity study in the rat which was requested in the Aliphatic Alkyl Quaternary Reregistration Eligibility Document. Due to the absence of the 90-day inhalation toxicity study, a FQPA safety factor of 10X has been applied to the oral endpoint to calculate inhalation risks in order to be protective of any uncertainties associated with route-to-route extrapolation.

ii. There is no indication that Aliphatic Alkyl Quaternaries are neurotoxic chemicals and there is no need for a developmental neurotoxicity study or additional uncertainty factors to account for neurotoxicity.

iii. There is no evidence that Aliphatic Alkyl Quaternaries result in increased susceptibility in in utero rats or rabbits in the prenatal developmental toxicity studies or in young rats in the 2-generation reproductive toxicity study.

iv. There are no residual uncertainties identified in the exposure databases. The dietary food exposure assessment was performed based on 10% transfer rate and tolerance-level residues. Similarly conservative Residential SOPs were used to assess post-application exposure to children as well as incidental oral exposure of toddlers. These assessments will not underestimate the exposure and risks posed by Aliphatic Alkyl Quaternaries.

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's risk assessment for the Group I Cluster is based on an assessment of the cumulative exposure to all aliphatic alkyl quaternary compounds. The individual exposure scenarios in the DDAC assessments (as well as the aggregate assessment in the Aliphatic Alkyl Quaternary (DDAC) Reregistration Eligibility Decision (RED)) were developed by assuming that a DDAC compound was used on 100% of the surfaces authorized on the label that could result in human exposure and summing the percent active ingredients on the labels for all of the aliphatic alkyl quaternary compounds when used in combination. Thus, because the risk assessment for DDAC accounts for exposures to all of the aliphatic alkyl quaternary compounds, there is no need for a separate cumulative risk assessment for those compounds. The Agency has not identified any other substances as sharing a common mode of toxicity with DDACB.

1. Dietary risk from food and feed uses. EPA compares the estimated dietary exposures to an acute population adjusted dose (aPAD) and a chronic population adjusted dose (cPAD), 0.1 mg/kg/day, which are the same value for DDACB. Generally, a dietary exposure estimate that is less than 100% of the aPAD or the cPAD does not exceed the Agency's LOC.

The antimicrobial indirect food use acute and chronic risk estimates from exposure to treated utensils and countertops are below the Agency's LOC. For adult males, the acute and chronic dietary exposure risk estimates are 9.9% for utensils and 0.8% for countertops. The aPAD and cPAD for adult females (13-69) is 11.5% for utensils. The aPAD from countertops for adult females is 0.8% and the cPAD is 0.5%. For children ages 1-2, the most highly exposed population subgroup, the acute and chronic dietary risk estimates are 68.9% for utensils and 2.6% and 1.8%, respectively for acute and chronic dietary risks for countertops. Therefore, dietary exposure estimates are below Agency's LOC for all population subgroups. The antimicrobial indirect food use chronic risk estimates from exposure to treated food packaging and beverage bottles are also below the Agency's LOC.

Specific information on the dietary exposure assessment for DDACB can be found at http://www.regulations.gov . Docket ID Number EPA-HQ-2006-1024, Review of Petition to Amend 40 CFR 180.940 to add Didecyl Dimethyl Ammonium Carbonate/Bicarbonate.

2. Non-occupational risk. Aggregate exposure takes into account residential exposure plus chronic exposure to food and water (considered to be a background exposure level). Using the exposure assumptions described in this unit for other non-occupational exposures, the MOEs are greater than the target of 1,000 for the inhalation route of exposure and 10 for dermal exposure, with the exception of the short term dermal exposures in females which has an MOE of 9. However, there is no significant concern for the proposed increase in use concentrations from 240 ppm to 400 ppm, with regard to dermal exposure, considering the contributing MOEs used to calculate the MOE of 9 were derived using conservative assumptions for the unit exposures and quantity handled. Furthermore there is a low likelihood that all scenarios (mopping, wiping, trigger pump spraying, immersing items into a solution and wearing treated clothing items) that were used to derive an MOE of 9 for dermal exposure would occur simultaneously.

Based on the toxicological and exposure data discussed in this preamble, EPA concludes that DDACB will not pose a risk under reasonably foreseeable circumstances. Accordingly, EPA finds that there is a reasonable certainty that no harm will result to the general population or to infants and children from aggregate exposure to DDACB residues.

An analytical method for food is not needed. Food-contact sanitizers are typically regulated by the State health departments to ensure that the food industry is using products in compliance with the regulations in 40 CFR 180.940. The end-use solution that is applied to the food-contact surface is analyzed not food items that may come into contact with treated surface. An analytical method is available to analyze the use dilution that is applied to food-contact surfaces. A titration method is used to determine the total amount of quaternary compound. If the use solution is a mixture of ADBAC and DDACB, then high pressure liquid chromatogram with ultraviolet visible (HPLC-UV) is used to determine the amount of ADBAC. The amount of DDACB is determined by calculating the difference between the total amount of quaternary compounds and ADBAC.

This regulation amends the exemption from the requirement of a tolerance for residues of DDACB under 40 CFR 180.940(a) resulting from an increase in the final use concentration from 240 ppm to 400 ppm on food contact surfaces in public eating establishments, on dairy processing equipment and food processing equipment and utensils.

This final rule establishes 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 section 408(d) of FFDCA, such as the tolerance 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.

This final rule directly regulates growers, food processors, food handlers, and food retailers, not States or tribes, nor does this action alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of section 408(n)(4) of FFDCA. As such, the Agency has determined that this action will not have a substantial direct effect on States or tribal governments, on the relationship between the national government and the States or tribal governments, or on the distribution of power and responsibilities among the various levels of government or between the Federal Government and Indian tribes. Thus, the Agency has determined that Executive Order 13132, entitled Federalism (64 FR 43255, August 10, 1999) and Executive Order 13175, entitled Consultation and Coordination with Indian Tribal Governments (65 FR 67249, November 9, 2000) do not apply to this final rule. In addition, this final rule does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) (Pub. L. 104-4).

This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to 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 note).

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:

This final rule, under the provisions of section 408 of the Federal Food, Drug, and Cosmetic Act (FFDCA), 21 U.S.C. 346a, amends EPA's regulations governing crop group tolerances for pesticides. Specifically, the rule expands upon existing stone fruit and tree nut crop groups by adding new commodities and establishes crop subgroups for the new stone fruit crop group. This final rule is the third in a series of planned crop group updates expected to be promulgated in the next several years.

EPA is authorized to establish tolerances for pesticide chemical residues in food under FFDCA section 408. EPA establishes tolerances for each pesticide based on the potential risks to human health posed by that pesticide. A tolerance is the maximum permissible residue level established for a pesticide in raw agricultural produce and processed foods. The crop group regulations currently in 40 CFR 180.40 and 180.41 enable the establishment of tolerances for a group of crops based on residue data for certain crops that are representative of the group. Crop group regulations are promulgated under section 408(e)(1)(C) which authorizes EPA to establish “general procedures and requirements to implement [section 408].” 21 U.S.C. 346a(e)(1)(C).

You may be potentially affected by this action if you are an agricultural producer or food manufacturer. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document might apply to them. Potentially affected entities may include, but are not limited to:

• Crop production (NAICS code 111), e.g., agricultural workers; greenhouse, nursery, and floriculture workers; farmers.

• Animal production (NAICS code 112).

• Pesticide manufacturing (NAICS code 32532).

EPA prepared an analysis of the potential costs and benefits associated with the establishment of crop groupings when it issued the first proposed rule in this series of rulemakings, which published in the Federal Register of May 23, 2007 (77 FR 28920). This analysis is contained in “Economic Analysis Proposed Expansion of Crop Grouping Program,” a copy of which is available in the docket for this action. In general, the Agency anticipates that revisions to the crop grouping program will result in no appreciable costs or negative impacts to consumers, specialty crop producers, pesticide registrants, human health, or the environment. The impacts of this rule are measured primarily on a qualitative basis. However, the rule is expected to reduce the cost of generating residue data for pesticide registration and new food uses, because it will have the effect of reducing the number of residue chemistry studies, because fewer representative crops would need to be tested under a crop grouping scheme than would otherwise be required.

Benefits of the rule can be shown through an example of the impact of the changes to Crop Group 3 that were accomplished in a prior rulemaking (72 FR 69150, December 7, 2007). That rulemaking expanded Crop Group 3, Bulb Vegetable, from 7 to 25 crops, an increase of 18 from the original crop group. Prior to the expansion of that subgroup, adding tolerances for 18 new crops would have required at least 18 field trials at a cost of approximately $5.4 million (assuming $300,000 per field trial).

This action is intended to promote more extensive use of crop group tolerances; in particular, it will assist in making available lower-risk pesticides for minor crops both domestically and in countries that export food to the United States. In addition, expanding crop groups will greatly increase the efficiency of IR-4 and EPA in registering pesticides on specialty crops and reduce the administrative costs of both the IR-4 testing process and the EPA review process.

EPA published a notice of proposed rulemaking in the Federal Register of November 9, 2011 (76 FR 69693) (FRL-8887-8). Written comments were received from three parties in response to the proposal: A private citizen; The Embassy of the Republic of Korea; and from the American Pistachio Growers trade association.

In this section, EPA describes the major provisions of the proposed rule, the comments received on each provision and EPA's responses to those comments, including EPA's determination if any modification of the proposed rule is warranted.

1. Revise the proposed crop group name. The final rule retains the pre-existing Crop Group 12 and adds a new group titled “Crop Group 12-12: Stone Fruit Group.” Although the new group was proposed as “Crop Group 12-11: Stone Fruit Group,” this change has been effected in order to reflect the correct year of establishment, which is 2012. Therefore, this final rule adds a new stone fruit group, “Crop Group 12-12: Stone Fruit Group,” but retains the pre-existing Crop Group 12.

2. Add commodities. The final rule expands the stone fruit crop group from the existing 11 commodities to 22 commodities in Crop Group 12-12: Stone Fruit Group.

EPA received one comment from a private citizen that noted that the commodity chokecherry, which was proposed to be included in the revised Crop Group 12-12: Stone Fruit Group and Cherry subgroup 12-12A, is already established in Crop Group 13-07: Berry and Small Fruit Group and Large Shrub/Tree Berry Subgroup 13-07C. As a general practice, the Agency will avoid having a commodity as a member of more than one crop group. Accordingly, EPA revisited the proposal to include chokecherry in the revised crop group.

Although chokecherry is a stone fruit, its fruit size is closer to elderberry and mulberry, the representative commodities for Large Shrub/Tree Berry Subgroup 13-07C, rather than sweet or tart cherry, the representative commodities for Cherry Subgroup 12-12A. The diameter for chokecherry is 0.3 inches (0.8 cm), elderberry is 0.3-0.5 inches (0.8-1.3 cm), mulberry is 0.5 inches (1.3 cm), and sweet cherry is 1.4 inches (3.6 cm). Cherry, the commodity proposed as the representative for chokecherry in the revised Crop Subgroup 12-12A, has a diameter that is approximately 4.7 times larger than the chokecherry, while both elderberry and mulberry are approximately the same size as chokecherry. The application of pesticides on commodities with smaller diameters (surface area to volume ratio) often results in higher residues than on larger commodities. Therefore, the EPA has determined that it is appropriate to retain chokecherry in the previously established Crop Group 13-07 and Subgroup 13-07C and will not include chokecherry in Crop Group 12-12: Stone Fruit Group or Cherry Subgroup 12-12A.

Additionally, a comment was received from the Embassy of the Republic of Korea requesting that Chinese jujube ( Ziziphus jujuba Mill.) be reconsidered as a member of Crop Group 12-12: Stone Fruit Group. Chinese jujube was originally included in the petition to the Agency as a proposed member of the revised stone fruit crop group. However, when EPA first reviewed the available supporting information, EPA concluded that it might be more appropriate to include Chinese jujube in a future proposed tropical fruit, edible peel crop group. The Agency noted that Chinese jujube is a member of a different plant family ( Rhamnaceae instead of Rosaceae) as a rationale for this decision. Further information about the original petition to the Agency to include Chinese jujube and EPA's previous review of the commodity can be found in the docket, identified by document ID No. EPA-HQ-OPP-2006-0766-0044.

However, after reviewing the Korean data submitted with the comment and literature from the United States, EPA finds that Chinese jujube growth and cultural practices are similar to some stone fruits, such as cherries and small varieties of plums, and should therefore be similar to other stone fruit in terms of pesticide residue exposure.

Chinese jujube is a traditional East Asian fruit crop mainly cultivated in temperate regions of China, Korea, Taiwan, and Japan. Chinese jujube has large leaf canopies shading the small sized fruits, and the fruit is botanically considered a stone fruit or “drupe.” The Chinese jujube is also deciduous; the crop loses its leaves in the fall and has a dormant period in the winter, similar to other members of Crop Group 12-12: Stone Fruit Group. Additionally, the flower to harvest time as well as the fruit shape, size, and smooth skin texture is similar to the plum.

The Chinese jujube was introduced into the United States from China in 1908, and it is widely distributed in the southern states as both an ornamental crop and potential minor food crop. Improved varieties of Chinese jujube are available to growers from commercial nursery catalog companies, and there has been recent research in cultivating the crop in the United States as a potential profitable minor crop. For these reasons, EPA concludes it would be appropriate to include Chinese jujube as a member of Crop Group 12-12: Stone Fruit Group, and as a member of the Plum Subgroup 12-12C.

Finally, EPA has revised the taxonomic names for several commodities in Crop Group 12-12: Stone Fruit Group, in order to reflect the currently accepted taxonomic name or names. Based on the decision to remove chokecherry and add Chinese jujube to the revised Crop Group 12-12: Stone Fruit Group, the final rule expands Crop Group 12-12: Stone Fruit Group to include 22 commodities.

3. Create new subgroups. The final rule retains the proposed addition of three subgroups to Crop Group 12-12: Stone Fruit Group, and updates the names of the subgroups to reflect the correct year that the subgroups are being established. Based on the information considered, chokecherry has been removed from inclusion in Crop Subgroup 12-12A, and Chinese jujube has been added to Crop Subgroup 12-12C. Therefore, the three subgroups are being established as follows:

i. Cherry Subgroup 12-12A. (Representative commodities—Sweet cherry or Tart cherry). Five commodities are included in this subgroup.

ii. Peach Subgroup 12-12B. (Representative commodity—Peach). Two commodities are included in this subgroup.

iii. Plum Subgroup 12-12C. (Representative commodities—Plum or Prune plum). Fifteen commodities are included in this subgroup.

EPA adopts these proposals as final, with the changes noted in this section.

1. Revise the proposed crop group name. The final rule retains the pre-existing Crop Group 14 and adds a new group titled “Crop Group 14-12: Tree Nut Group.” Although the new group was proposed as “Crop Group 14-11: Tree Nut Group,” this change has been effected in order to reflect the correct year of establishment, which is 2012. Therefore, this final rule adds a new tree nut group, “Crop Group 14-12: Tree Nut Group,” but retains the pre-existing Crop Group 14.

2. Add commodities. The final rule expands the tree nut crop group from the existing 12 commodities to 39 commodities in Crop Group 14-12: Tree Nut Group.

EPA received one comment from the American Pistachio Growers trade association that supported including pistachio in the revised tree nut crop group. They noted that including pistachio will, “* * * provide the pistachio growers with the ability to use crop tools necessary to combat pests,” and further noted that, “* * * growers, processors, marketers, and consumers * * * will benefit from including pistachios in the tree nut group.” EPA agrees with these comments.

EPA has revised the taxonomic names for several commodities in Crop Group 14-12: Tree Nut Group, in order to reflect the currently accepted taxonomic name or names. Therefore, EPA adopts these proposals as final, with the changes noted in this section.

After fully considering all comments, EPA is finalizing the proposed rule with the revisions discussed previously. Other than these revisions, EPA is finalizing the rule as proposed, based on the rationale set forth in the proposed rule.

When a crop group is amended in a manner that expands or contracts its coverage of commodities, EPA will (1) retain the pre-existing crop group in 40 CFR 180.41; (2) insert the revised crop group immediately after the pre-existing crop group in the Code of Federal Regulations; and (3) title the revised crop group in a way that clearly differentiates it from the pre-existing crop group.

The revised crop group will retain roughly the same name and number as the pre-existing group, except the number will be followed by a dash and the final digits of the year established (e.g., Crop Group 8-10).

EPA will initially retain pre-existing crop groups that have been superseded by revised crop groups. EPA will not establish new tolerances under the pre-existing groups. Further, EPA plans to eventually convert tolerances for any pre-existing crop group to tolerances with coverage under the revised crop group. This conversion will be effected both through the registration review process and in the course of evaluating new uses for a pesticide. EPA requests that petitioners for tolerances address this issue in their petitions. For existing petitions for which a Notice of Filing has been published, the Agency will attempt to conform these petitions to this rule.

This action is not a “significant regulatory action” under the terms of Executive Order 12866, entitled “Regulatory Planning and Review” (58 FR 51735, October 4, 1993) and was therefore not reviewed by the Office of Management and Budget (OMB) under Executive Orders 12866 and 13563, entitled “Improving Regulation and Regulatory Review” (76 FR 3821, January 21, 2011).

This rule does not impose any new information collection requirements that would require additional review or approval by OMB under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq. Burden is defined at 5 CFR 1320.3(b). An Agency may not conduct or sponsor, and a person is not required to respond to a collection of information that requires OMB approval under PRA, unless it has been approved by OMB and displays a currently valid OMB control number. The OMB control numbers for EPA's regulations in title 40 of the CFR, after appearing in the Federal Register , are listed in 40 CFR part 9, and included on the related collection instrument, or form, if applicable.

The information collection activities associated with the submission of a petition to request a tolerance are already approved under OMB control number 2070-0024 (EPA ICR No. 0597.10), and the changes to the crop grouping regulations do not change the covered activities such that additional OMB review or approval is required.

The Regulatory Flexibility Act (RFA), 5 U.S.C. 601 et seq., generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements under the Administrative Procedure Act (APA), 5 U.S.C. 551-553, or any other statute unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Under the RFA, small entities include small businesses, small organizations, and small governmental jurisdictions.

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

After considering the economic impacts of this final rule on small entities, I certify that this action will not have a significant economic impact on a substantial number of small entities. This final rule does not have any direct adverse impacts on small businesses, small non-profit organizations, or small local governments. In determining whether a rule has a significant economic impact on a substantial number of small entities, the impact of concern is any significant adverse economic impact on small entities, since the primary purpose of the regulatory flexibility analyses is to identify and address regulatory alternatives “which minimize any significant economic impact of the proposed rule on small entities” (5 U.S.C. 603 and 604). Thus, an agency may certify under section 605(b) of the RFA if the rule relieves regulatory burdens or otherwise has a positive economic effect on all of the small entities subject to the rule.

As discussed previously, this rule provides regulatory relief and regulatory flexibility. The new crop groups ease the process for pesticide manufacturers to obtain pesticide tolerances on greater numbers of crops. Pesticides will be more widely available to growers for use on crops, particularly specialty crops.

Pursuant to Title II of the Unfunded Mandates Reform Act (UMRA), 2 U.S.C. 1531-1538, EPA has determined that this final rule does not contain a Federal mandate that may result in expenditures of $100 million or more for state, local and tribal governments, in the aggregate, or the private sector in any one year. Accordingly, this rule is not subject to the requirements of sections 202, 203, 204, and 205 of UMRA.

This action will not have “federalism implications” as specified in Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999), because this action 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 the Order. Thus, Executive Order 13132 does not apply to this final rule.

This action will not have “tribal implications” as specified in Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments:” (65 FR 67249, November 9, 2000), because it will not have any effect on tribal governments, on the relationship between the Federal government and the Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes, as specified in the Order. Thus, Executive Order 13175 does not apply to this final rule.

EPA interprets Executive Order 13045, entitled “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997) as applying only to those regulatory actions that concern health or safety risks, such that the analysis required under section 5-501 of the Order has the potential to influence the regulation. Executive Order 13045 does not apply to this rule because this action is not designated as an “economically significant regulatory action” as defined by Executive Order 12866 (see Unit III.A.), nor does it establish an environmental standard, or otherwise have a disproportionate effect on children.

This action is not a “significant energy action” as defined in Executive Order 13211, entitled “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) because it is not likely to have any adverse effect on the supply, distribution, or use of energy.

This action does not involve technical standards that would require the consideration of voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act (NTTAA), 15 U.S.C. 272 note.

This action does not have an adverse impact on the environmental and health conditions in low-income and minority communities. Therefore, this action does not involve special consideration of environmental justice related issues as specified in Executive Order 12898, entitled “Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations” (59 FR 7629, February 16, 1994).

Pursuant to the Congressional Review Act, 5 U.S.C. 801 et seq., 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 . This rule is not a “major rule” as defined by 5 U.S.C. 804(2).

Therefore, 40 CFR chapter I is amended as follows:

Under sections 3004(d) through (g) of the Resource Conservation and Recovery Act (RCRA), the land disposal of hazardous wastes is prohibited unless such wastes are able to meet the Land Disposal Restrictions (LDR) treatment standards (or treatment standards) established by EPA (or the Agency). Under section 3004(m) of RCRA, EPA is required to set “levels or methods of treatment, if any, which substantially diminish the toxicity of the waste or substantially reduce the likelihood of migration of hazardous constituents from the waste so that short-term and long-term threats to human health and the environment are minimized.” EPA interprets this language to authorize treatment standards based on the performance of the best demonstrated available technology (BDAT). This interpretation was upheld by the D.C. Circuit in Hazardous Waste Treatment Council v. EPA, 886 F. 2d 355 (D.C. Cir. 1989).

The Agency recognizes, however, that there may be wastes that cannot be treated to the levels specified in the regulations ( see 40 CFR 268.40) because an individual waste matrix or concentration can be substantially more difficult to treat than those wastes evaluated in establishing the treatment standard (51 FR 40576, November 7, 1986) . 1 For such wastes, EPA has a process by which a generator or treater may seek a treatment variance ( see 40 CFR 268.44). If granted, the terms of the variance establish an alternative treatment standard for the particular waste at issue.

Treatment of selenium poses special difficulties. In particular, it can be technically challenging to treat wastes containing selenium in combination with other metals e.g., cadmium, lead and/or chromium because of their different chemical properties and solubility curves (62 FR 26041, May 12, 1997).

The current treatment standard for a waste exhibiting the toxicity characteristic for selenium (RCRA Hazardous Waste D010) is based upon the performance of stabilization on low concentration selenium wastes. When the Agency developed the treatment standard for selenium, EPA believed that wastes containing high concentrations of selenium were rarely generated and land disposed (59 FR 47980, September 19, 1994). The Agency also stated that it believed that, for most wastes containing high concentrations of selenium, recovery of the selenium would be feasible using recovery technologies currently employed by copper smelters and copper refining operations (Id.). The Agency further stated in 1994, that it did not have any performance data for selenium recovery, but available information indicated that some recovery of elemental selenium out of certain types of scrap material and other wastes was practiced in the United States. 2

In 1994, the Agency used performance data from the stabilization of a mineral processing waste, that was characteristically hazardous (RCRA Hazardous Waste D010), to set the national treatment standard for selenium. At that time, we determined that this characteristically-hazardous mineral processing waste represented the most difficult-to-treat selenium waste. This untreated waste contained up to 700 ppm total selenium and 3.74 mg/L selenium, as measured by the Toxicity Characteristic Leaching Procedure (TCLP). The resulting post-treatment levels of selenium in the TCLP leachate were between 0.154 mg/L and 1.80 mg/L, which (after considering the range of treatment process variability) led to EPA establishing a national treatment standard of 5.7 mg/L TCLP for D010 selenium nonwastewaters. 3 In the Phase IV LDR final rule, the Agency determined that a treatment standard of 5.7 mg/L TCLP, continued to be appropriate for D010 nonwastewaters (63 FR 28556, May 26, 1998). The Agency also changed the universal treatment standard (UTS) for selenium nonwastewaters from 0.16 mg/L to 5.7 mg/L TCLP.

Under 40 CFR 268.44, facilities can apply for a site-specific treatment variance in cases where a waste that is generated under conditions specific to only one site cannot be treated to the specified LDR treatment standards. In such cases, the generator(s) or the treatment facility may apply to the Administrator, or to EPA's designated representative, (in this case the Assistant Administrator for Solid Waste and Emergency Response) for a site-specific variance. The applicant for a site-specific variance must demonstrate that, because the physical or chemical properties of the waste differ significantly from the waste analyzed in developing the treatment standard, the waste cannot be treated to the specified levels or by the specified methods. There are other grounds for obtaining variances, but this is the only provision relevant to this action.

On September 16, 2008, U.S. Ecology Nevada (USEN) in Beatty, Nevada submitted a petition requesting a site-specific treatment variance from the LDR treatment standards for hazardous selenium-bearing waste generated by the Owens-Brockway Glass Container Company (Owens-Brockway) in Vernon, California. Owens-Brockway operates a glass manufacturing facility that generates approximately 50 to 100 tons per year of electrostatic precipitator (ESP) dust requiring management as a hazardous waste. The ESP dust is generated by the glass furnace air emissions control system and is hazardous due to its high concentrations of leachable arsenic (RCRA Hazardous Waste D004), cadmium (RCRA Hazardous Waste D006), lead (RCRA Hazardous Waste D008), and selenium (RCRA Hazardous Waste D010). USEN submitted analytical data demonstrating that the chemical properties of the waste differed significantly from the waste analyzed in developing the LDR treatment standard. 4 They also submitted data demonstrating that the waste could not be treated to the specified level of 5.7 mg/L TCLP for selenium. USEN requested an alternative treatment standard of 59 mg/L TCLP, which was calculated using analytical treatment data from a stabilization mixture of ferrous sulfate, quick lime and sodium sulfide flakes with a 1:0.45 waste to reagent ratio. 5

On April 6, 2011, the Agency issued a Direct Final rule (76 FR 18921) and a parallel Proposal (76 FR 19003) granting a site-specific treatment variance to USEN for the treatment and disposal of hazardous selenium-bearing waste generated by Owens-Brockway. The site-specific treatment variance provided for an alternative treatment standard of 59 mg/L TCLP with the condition that the waste to reagent ratio not exceed 1:0.45. The Agency concluded that USEN had demonstrated that the chemical properties of the waste generated by Owens-Brockway differed significantly from the waste analyzed in developing the LDR treatment standard, and that the waste could not be treated to the specified level of 5.7 mg/L TCLP for selenium, necessitating an alternative treatment standard.

The Direct Final rule and the parallel Proposal also included an action to withdraw the site-specific treatment variance issued to Chemical Waste Management (CWM) in Kettleman Hills, California for this same waste. 6 The Agency issued both a Direct Final and a parallel Proposal because EPA considered these actions to be non-controversial. However, EPA stated that if adverse comment was received, the Direct Final rule would be withdrawn and we would proceed with a subsequent final rule. The Agency received no comments on granting a site-specific treatment variance to USEN, however, one adverse comment was received on withdrawing the CWM variance. As a result, on May 24, 2011, the Direct Final rule was withdrawn (76 FR 30027). The comment can be found in the docket supporting this rule.

EPA is not taking action on the proposal to withdraw the existing site-specific treatment variance granted to CWM. EPA has authorized the State of California to grant and administer site-specific treatment variances under 40 CFR 268.44. [See 75 FR at 60401 (September 10, 2010)]. As a result, California now has sole authority to deal with issues pertaining to treatment variances for entities within its borders, including whether to withdraw the treatment variance to CWM for Owens-Brockway selenium-bearing waste, and any other issues related to that treatment variance. 7 Necessarily, therefore, EPA is not responding to any of the comments submitted on this issue, since all comments pertain to issues within the scope of the authorized California program.

EPA is promulgating, as proposed, a site-specific treatment variance, from the LDR treatment standards, for hazardous selenium bearing waste generated by Owens-Brockway and managed by USEN of Beatty, Nevada. With the information provided to the Agency as part of their petition, EPA has concluded that the chemical properties of Owen-Brockway's selenium-bearing waste differ significantly from the waste used in developing the LDR treatment standard and that the generated waste cannot be treated to the specified treatment level of 5.7 mg/L TCLP. The site-specific treatment variance provides an alternative treatment standard of 59 mg/L for selenium with the condition that the waste to reagent ratio not exceed 1:0.45 when the waste is treated and disposed at USEN's permitted hazardous waste facility. The Agency received no comments disagreeing with the Agency's proposal.

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

This action does not impose any new information collection burden. This action grants a site-specific treatment variance to USEN for the treatment of hazardous selenium-bearing waste generated by Owens-Brockway under RCRA's LDR program. The Office of Management and Budget (OMB) has previously approved the information collection requirements contained in the existing regulations at 40 CFR 268.42 and .44 under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. and has assigned OMB control number 2050-0085. The OMB control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.

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

This site-specific treatment variance does not create any new requirements. Rather, it establishes an alternative treatment standard for a specific waste that applies to only one facility, USEN located in Beatty, Nevada. Therefore, we hereby certify that this rule will not add any new regulatory requirements to small entities. This rule, therefore, does not require a regulatory flexibility analysis.

This action contains no Federal mandates under the provisions of Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 1531-1538 for State, local, or tribal governments or the private sector. This action imposes no enforceable duty on any State, local or tribal governments or the private sector. This action would not impose any new duties on the states hazardous waste program. EPA has determined, therefore, that this rule would not contain regulatory requirements that might significantly or uniquely affect small governments in that the authority for this action exists with the Federal government. Therefore, this action is not subject to the requirements of sections 202 or 205 of the UMRA.

This rule is also not subject to the requirements of section 203 of UMRA because it contains no regulatory requirements that might significantly or uniquely affect small governments.

This action does not have federalism implications. 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. This action grants a site-specific treatment variance applicable to one facility. Thus, Executive Order 13132 would not apply to this action.

This action would not have tribal implications, as specified in Executive Order 13175 (65 FR 67249, November 9, 2000). This action is a site-specific treatment variance that applies to only one facility, which is not a tribal facility or located on tribal lands. Thus, Executive Order 13175 would not apply to this action.

EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997) as applying only to those regulatory actions that are based on health or safety risks, such that the analysis required under section 5-501 of the Executive Order has the potential to influence the regulation. This action is not subject to Executive Order 13045 because it would not establish an environmental standard intended to mitigate 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 would not be a significant regulatory action under Executive Order 12866.

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (“NTTAA”), Public Law 104-113, 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary consensus standards in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g., materials specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies. NTTAA directs EPA to provide Congress, through OMB, explanations when the Agency decides not to use available and applicable voluntary consensus standards.

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

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

EPA has determined that this rule will not have a disproportionately high and adverse human health or environmental effects on minority or low-income populations because it does not affect the level of protection provided to human health or the environment. The site-specific treatment variance being finalized applies to a selenium bearing waste that will be treated and disposed in an existing, permitted RCRA facility, ensuring protection to human health and the environment. Therefore, the rule will not result in any disproportionately negative impacts on minority or low-income communities relative to affluent or non-minority communities.

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, when finalized, 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).

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

The Federal Emergency Management Agency (FEMA) makes the final determinations listed below of the modified BFEs for each community listed. These modified BFEs 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.

The modified BFEs are not listed for each community in this notice. However, this final rule includes the address of the Chief Executive Officer of the community where the modified BFE determinations are available for inspection.

The modified BFEs are made pursuant to section 206 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4105, and are in accordance with the National Flood Insurance Act of 1968, 42 U.S.C. 4001 et seq., and with 44 CFR part 65.

For rating purposes, the currently effective community number is shown and must be used for all new policies and renewals.

The modified BFEs are the basis for the floodplain management measures that the community is required either to adopt or to show evidence of being already in effect in order to qualify or to remain qualified for participation in the National Flood Insurance Program (NFIP).

These modified BFEs, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities.

These modified BFEs are used to meet the floodplain management requirements of the NFIP and also are used to calculate the appropriate flood insurance premium rates for new buildings built after these elevations are made final, and for the contents in those buildings. The changes in BFEs are in accordance with 44 CFR 65.4.

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, Federalism.

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

Accordingly, 44 CFR part 65 is amended to read as follows:

This is a summary of the Commission's First Report and Order in IB Docket No. 11-133, FCC 12-93, adopted August 17, 2012, and released August 17, 2012. The full text of this document is available for inspection and copying during normal business hours in the FCC Reference Information Center, Portals II, 445 12th Street SW., Washington, DC 20554. The complete text may also be purchased from the Commission's duplicating contractor, Best Copy and Printing, Inc., Portals II, 445 12th Street SW., Room CY-B402, Washington, DC 20554, telephone: (800) 378-3160, fax: (202) 488-5563, or via its web site, http://www.bcpiweb.com. The complete text also is available on the Commission's Web site at http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-12-93A1.pdf. To request the document in accessible formats for people with disabilities (Braille, large print, electronic files, audio format), send an email to fcc504@fcc.gov or call the Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-418-0432 (tty).

1. On April 11, 2012, the International Bureau, on behalf of the Commission, issued a Public Notice in this docket (77 FR 24452, April 24, 2012) inviting comment on the legal and policy implications of forbearing under section 10 of the Communications Act of 1934, as amended (the Act), 47 U.S.C. 160, from applying section 310(b)(3) of the Act to certain foreign ownership interests in common carrier licensees, where those interests are held through U.S.-organized entities that do not control the licensee. The First Report and Order forbears, pursuant to section 10(a) of the Act, from applying the 20 percent foreign ownership limit set forth in section 310(b)(3) of the Act to the class of common carrier licensees in which foreign ownership in the licensee is held through U.S.-organized entities that do not control the licensee, to the extent the Commission determines such foreign ownership is consistent with the public interest under the policies and procedures the Commission has adopted for the public interest review of foreign ownership subject to section 310(b)(4) of the Act. The First Report and Order refers to this class of licensees as “licensees subject to section 310(b)(3) forbearance.” The forbearance approach applies only to such foreign ownership in common carrier licensees and not to broadcast or other licensees covered by section 310(b)(3). Nor does the approach apply to foreign ownership held in a licensee other than indirectly through an intervening U.S.-organized entity that does not control the licensee.

2. Section 10(a) of the Act enables the Commission to forbear from applying any regulation or any provision of the Act to a telecommunications carrier or service, or a class of telecommunications carriers or services, if the Commission determines that forbearances satisfies the following three-pronged test: (1) Enforcement of such regulation or provision is not necessary to ensure that the charges, practices, classifications, or regulations by, for, or in connection with that telecommunications carrier or telecommunications service are just and reasonable and are not unjustly or unreasonably discriminatory; (2) enforcement of such regulation or provision is not necessary for the protection of consumers; and (3) forbearance from applying such provision or regulation is consistent with the public interest. 47 U.S.C. 160(a).

3. The First Report and Order finds that forbearing from applying section 310(b)(3)'s 20 percent foreign equity and voting limits to the class of common carrier licensees in which foreign interests in the licensee are held through U.S.-organized entities that do not control the licensee, to the extent such foreign ownership serves the public interest as determined under the policies and procedures the Commission uses for assessing foreign ownership of the controlling U.S.-organized parents of common carrier licensees under section 310(b)(4), satisfies each of the three section 10 criteria. The First Report and Order requires licensees subject to section 310(b)(3) forbearance to file a petition for declaratory ruling or similar request to obtain Commission approval before foreign ownership held in the licensee through U.S.-organized entities that do not control the licensee, together with foreign ownership held in the licensee itself, exceeds 20 percent of the licensee's equity interests and/or 20 percent of its voting interests.

4. In the First Report and Order, the Commission concludes that, under the first prong of section 10, it is not necessary to apply the foreign ownership limits in section 310(b)(3) to licensees subject to section 310(b)(3) forbearance to ensure that their charges and practices are just and reasonable and not unjustly or unreasonably discriminatory. Based on the Commission's experience in applying its policies under section 310(b)(4), the Commission finds no evidence that the foreign ownership of a common carrier licensee, in and of itself, is directly relevant to the carrier's compliance with the requirements of sections 201 and 202 of the Act that charges, practices, classifications, and regulations be just and reasonable and not unjustly or unreasonably discriminatory. In addition, the Commission has other, more tailored tools at its disposal, such as section 201, 202, and 208 of the Act, to ensure that rates, practices and classifications of common carrier licensees are just and reasonable and not unjustly or unreasonably discriminatory.

5. The Commission also concludes that, under the section prong of section 10, it is unnecessary for the protection of consumers to apply section 310(b)(3)'s 20 percent limit to foreign interests in licensees subject to section 310(b)(3) forbearance. Under the forbearance approach, the Commission will give notice and seek public comment on a petition for declaratory ruling or similar request asking for approval of proposed foreign equity and/or voting interests in a common carrier licensee over 20 percent. This notice and comment process will inform any Commission decision to grant a petition for declaratory ruling to exceed section 310(b)(3)'s 20 percent limit and allow the Commission to assess any potential harm to consumers.

6. The Commission concludes, under the third prong of section 10, that the public interest would be served by not applying the foreign ownership limit of section 310(b)(3) to licensees subject to section 310(b)(3) forbearance—where the licensee has greater than 20 percent foreign ownership held through U.S.-organized entities that do not control the licensee—for the same reasons that the public interest is served when the Commission allows, under section 310(b)(4), greater than 25 percent foreign ownership in the controlling U.S.-organized parent of a common carrier licensee under otherwise identical circumstances. In the context of common carrier licensees, the Commission discerns no public interest distinction between the two situations.

7. By incorporating the Commission's section 310(b)(4) policies and procedures, the forbearance approach will protect the national security objectives underlying the Act. These policies and procedures provide Executive Branch expert agencies the opportunity to review proposed foreign ownership in the controlling U.S.-organized parents of common carrier licensees for any national security, law enforcement, or public safety issues. The forbearance approach will provide the Executive Branch agencies the same opportunity to assess proposed foreign ownership in licensees subject to section 310(b)(3) forbearance.

8. In addition, the forbearance approach will ensure that foreign ownership from World Trade Organization (WTO) Member countries will be reviewed under the Commission's open entry standard, whether the foreign investment is held through U.S.-organized entities that control the licensee or through U.S.-organized entities that do not control the licensee. The forbearance approach also comports with commenters' request in this docket that the Commission treat all “indirect” foreign ownership in a common carrier licensee in a manner consistent with the Commission's section 310(b)(4) policies and procedures so as to further the objectives of the WTO Basic Telecom Agreement. Conforming the Commission's foreign ownership policies for sections 310(b)(3) and 310(b)(4) will clarify and simplify Commission regulation of foreign ownership of common carrier licensees. The forbearance approach also will enhance competitive market conditions for common carrier licensees by allowing them and their potential owners to structure foreign investment in the licensee in a manner that best accommodates their financial considerations and business needs.

9. The forbearance approach requires a licensee to file a petition for declaratory ruling or similar request seeking Commission approval before foreign ownership held in the licensee through U.S.-organized entities that do not control the licensee, together with foreign ownership held in the licensee itself, exceeds 20 percent of the licensee's equity interests and/or 20 percent of its voting interests. The Commission, or the International Bureau on delegated authority, will place the request on notice for public comment and forward the petition to the Executive Branch agencies for review. Following conclusion of this process, the Commission, or the International Bureau on delegated authority, will issue a declaratory ruling as to whether the proposed foreign ownership is in the public interest. The licensee shall not be allowed to have foreign ownership under section 310(b)(3) in excess of 20 percent unless and until the Commission or the International Bureau has granted the licensee's request.

10. The Commission finds that the benefits of adopting the forbearance approach outweigh the costs. By forbearing from applying the section 310(b)(3) foreign ownership limit to the subject class of common carrier licensees, licensees and their potential owners will have flexibility in the structuring of their investment, free of a statutory constraint. The Commission anticipates that the costs of the approval process for proposed foreign ownership of licensees subject to section 310(b)(3) forbearance will be far less for licensees than the costs they have to incur in structuring their investments to comply with the section 310(b)(3) limit. Moreover, under the forbearance approach, the approval process will be consistent with the Commission's policy framework for foreign ownership of the controlling U.S. parents of licensees under section 310(b)(4). For these reasons, the Commission expects this approach to reduce unnecessary costs and burdens on common carrier licensees. Finally, the forbearance approach will not compromise the Commission's ability to carry out its statutory duties under section 310(b) of the Act, including protection of national security and law enforcement interests.

11. The First Report and Order defers consideration, to a later stage of the proceeding, of the comments urging the Commission to simplify the section 310(b)(4) requirements and apply those revised requirements to the evaluation of foreign interests in a common carrier licensee held through U.S.-organized entities that do not control the licensee.

12. The Regulatory Flexibility Act of 1980, as amended (RFA), 1 requires that a regulatory flexibility analysis be prepared for notice-and-comment rule making proceedings, unless the agency certifies that “the rule will not, if promulgated, have a significant economic impact on a substantial number of small entities.”  2 The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.”  3 In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. 4 A “small business concern” is one which: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the Small Business Administration (SBA).

13. The approach adopted in the First Report and Order will remove a statutory constraint on common carrier licensees, by forbearing from applying the 20 percent ownership limit under section 310(b)(3) to the class of common carrier licensees in which the foreign ownership is held in the licensee through intervening U.S.-organized entities that do not control the licensee. Instead of prohibiting foreign ownership in excess of 20 percent under section 310(b)(3), the Commission will assess whether the proposed foreign ownership in excess of 20 percent is in the public interest through an approval process that is consistent with its policies and procedures for approval of foreign ownership in a U.S.-organized entity that controls a licensee, under section 310(b)(4). The Commission believes that the new approach will reduce costs and burdens currently imposed on common carrier licensees, including those licensees that are small entities, while continuing to ensure that the Commission has the information it needs to carry out its statutory duties. Therefore, the Commission certifies that the new approach will not have a significant economic impact on a substantial number of small entities. The Commission will send a copy of the First Report and Order, including a copy of this Regulatory Flexibility Certification, to the Chief Counsel for Advocacy of the SBA. 5 This certification also will be published in the Federal Register . 6

14. The First Report and Order does not contain new or modified information collection requirements subject to the Paperwork Reduction Act of 1995, Public Law 104-13. The information collection requirements for the section 310(b) foreign ownership approval process are included in OMB Control No. 3060-0686. In addition, therefore, this document does not contain any new or modified information collection burden for small business concerns with fewer than 25 employees, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

15. The Commission has included a copy of the First Report and Order in a report sent to Congress and the Government Accountability Office pursuant to the Congressional Review Act. See 5 U.S.C. 801(a)(1)(A).

16. It is ordered, pursuant to sections 1, 2, 4(i), 4(j), 5(c), 10, 303(r), 308(b), 309, 310(b), 310(d), and 403 of the Communications Act of 1934, as amended, 47 U.S.C. 151, 152, 154(i), 154(j), 155(c), 160, 303(r), 308(b), 309, 310(b), 310(d), and 403, that the First Report and Order in IB Docket No. 11-133 IS ADOPTED.

17. It is further ordered that the requirements of this First Report and Order shall be effective upon publication in the Federal Register . 7

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

This is a synopsis of the Commission's Report and Order, adopted August 2, 2012, and released August 3, 2012. The full text of this Commission decision is available for inspection and copying during normal business hours in the FCC's Reference Information Center at Portals II, CY-A257, 445 12th Street SW., Washington, DC 20554. This document may also be purchased from the Commission's duplicating contractors, Best Copy and Printing, Inc., 445 12th Street SW., Room CY-B402, Washington, DC 20554, telephone 1-800-378-3160 or via email www.BCPIWEB.com. This document does not contain proposed information collection requirements subject to the Paperwork Reduction Act of 1995, Public Law 104-13. The Commission will send a copy of this Report and Order in a report to be sent to Congress and the Government Accountability Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

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

This final rule amends the Department's acquisition regulation which was initially issued in 2003. 68 FR 67871 (Dec. 4, 2003), as amended at 71 FR 25767 (May 2, 2006). On September 13, 2010, DHS published a notice of proposed rulemaking NPRM, with a public comment period ending on November 12, 2010. 75 FR 55529. DHS received no public comments on this NPRM. DHS is now adopting the proposed rule, with minor changes, as final.

In the NPRM, DHS proposed various changes to the Homeland Security Acquisition Regulations (HSAR), including changes to 48 CFR part 3006 implementing section 695 of the Post-Katrina Emergency Management Reform Act of 2006 (PKEMRA), Public Law 109-295, 120 Stat. 1394, 1460 (Oct. 4, 2006). This final rule implements the majority of the changes described in the “Discussion of Proposed Rule” section of the NPRM. See 75 FR 55530-55532.

Additionally, as a result of further internal review, DHS is making several minor changes to the proposed rule in this final rule. The changes are administrative in nature and do not change the substance of the rule. The changes to the proposed rule include: (1) Adding an “s” to the word “System” in the phrase “DHS Sensitive System Handbook” at 3004.470-2; changing the phrase “DHS legal counsel” to “legal counsel” at 3003.204-(a); and correcting the citation at 3003.1003(a) to read “(FAR) 48 CFR 52.203-13” in place of “(FAR) 49 CFR 52.203-13”. DHS is correcting these inadvertent typographical errors to ensure the final rule is clear and precise.

DHS is also making a technical change by removing the proposed change at (HSAR) section 3009.403 designating the DHS Heads of Contracting Activity as the DHS Suspension and Debarment Officials. The Secretary of Homeland Security has approved a new Suspension and Debarment program which eliminates the Heads of the Contracting Activities as Suspension and Debarment Officials. The change in the proposed rule is no longer necessary and is not included in this final rule.

DHS is also correcting the title of the FEMA HCA at 3002.101 to read “Director, Office of Acquisition Management (FEMA)” in place of “Director, Procurement (FEMA)”. This change is necessary due to a change in the naming convention for this office.

In the NPRM, DHS proposed to delete paragraph (d) of clause 3052.216-71, Determination of Award Fee, to align the HSAR with the OMB guidance, Appropriate Use of Incentive Contracts (Dec. 4, 2007). This final rule also revises the date of the entire clause to distinguish the existing version of the clause from the revised version.

The NPRM also proposed the inclusion of paragraph (k)(1) of 3052.204-71 Alternate I regarding contractor employee access. In this final rule, the proposed change to paragraph (k)(1) is not included because a similar provision already exists at (HSAR) 3004.470-2, citing to the DHS Sensitive Systems Policy Directive 4300A and the DHS 4300A Sensitive Systems Handbook both of which address contractor employee access.

Throughout this final rule, references to Title 41 of the United States Code have been revised to reflect the recodification of Title 41 under Public Law 111-350, January 4, 2011.

This is not a significant regulatory action under Section 6(b) of Executive Order 12866, as supplemented by Executive Order 13563, and the Office of Management and Budget has not reviewed this final rule. This final rule is not a major rule under 5 U.S.C. 804.

Under the Regulatory Flexibility Act (5 U.S.C. 601-612), the term “small entities” comprises of small businesses, not for profit organizations that are independently owned and operated and are not dominant in their fields, and government jurisdictions with populations of less than 50,000. DHS 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 because the rule applies to internal approval procedures, supplements the Federal Acquisition Regulations, and is intended to clarify or eliminate existing agency acquisition regulations and policies.

Under the Paperwork Reduction Act of 1995, Public Law 104-13, all Departments are required to submit to the Office of Management and Budget (OMB), for review and approval any reporting requirements inherent in a rule. The Paperwork Reduction Act applies to this final rule. However, the information collection requirements imposed by the provisions 3052.205-70 and 3052.212-70 are currently covered by the approved information collection requirements for provisions (OMB Clearance numbers 1600-0003, Post-Contract Award Information, and 1600-0005, Solicitation of Proposal Information for Award of Public Contracts). DHS considers that any changes due to the use of these clauses will be within the estimated hours for the existing approved OMB clearance. The clause at 3052.203-70 does not create a new information collection requirement. It provides a format for contractors to use when making a disclosure under FAR 3.1003 and 52.203-13. The FAR disclosure requirements are approved under OMB Clearance Number 9000-0164.

You need not respond to a collection of information unless it displays a currently valid control number from OMB. Use of these two information collections, 1600-0003 and 1600-0005, has been approved by OMB until January 31, 2012, and February 28, 2015, respectively. The extension for 1600-0003 is currently under review at OMB.

This final rule will not have 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. Therefore, in accordance with section 6 of Executive Order 13132, DHS has determined that this rule does not warrant the preparation of a federalism impact statement.

We have analyzed this final rule under Department of Homeland Security Management Directive 023-01 which guides the Department in complying with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f), and have made a determination this action is one of a category of actions which do not individually or cumulatively have a significant effect on the human environment. This rule, which does not involve any extraordinary circumstances, is categorically excluded under paragraphs A3(b) and A3(d) in Table I of Appendix A of Directive 023-01 because it implements legislation and amends acquisition regulations without changing the regulations' environmental effect.

Accordingly, DHS amends 48 CFR parts 3001, 3002, 3003, 3004, 3005, 3006, 3012, 3018, 3022, 3023, 3033, 3035, 3036, 3042, 3045, 3052, and 3053 as follows:

Introduction

This rule was preceded by a notice of proposed rulemaking (NPRM) that NHTSA published on June 13, 2012 (77 FR 35338).

The National Traffic and Motor Vehicle Safety Act, as amended by the Imported Vehicle Safety Compliance Act of 1988, and recodified at 49 U.S.C. 30141-30147 (“the Act”), provides for fees to cover the costs of the importer registration program, the cost of making import eligibility decisions, and the cost of processing the bonds furnished to Customs. Certain fees became effective on January 31, 1990, and have been in effect, with modifications, since then. On June 24, 1996, we published a notice in the Federal Register at 61 FR 32411 that discussed the rulemaking history of 49 CFR Part 594 and the fees authorized by the Act. The reader is referred to that notice for background information relating to this rulemaking action.

We are required to review and make appropriate adjustments at least every two years in the fees established for the administration of the RI program. See 49 U.S.C. 30141(e). The fees applicable in any fiscal year (FY) are to be established before the beginning of such year. Id. We last amended the fee schedule in 2010. See final rule published on August 11, 2010 at 75 FR 48608. Those fees apply to Fiscal Years 2011 and 2012.

The fees adopted in this final rule are based on time expenditures and costs associated with the tasks for which the fees are assessed. The fees adopted in this notice reflect the freeze in General Schedule salary rates since January 2010 and the slight increases in indirect costs attributed to the agency's overhead costs since the fees were last adjusted.

There were no comments in response to the notice of proposed rulemaking.

Section 30141(a)(3) of Title 49, U.S. Code provides that RIs must pay the annual fees established “to pay for the costs of carrying out the registration program for importers * * *.” This fee is payable both by new applicants and by existing RIs. To maintain its registration, each RI, at the time it submits its annual fee, must also file a statement affirming that the information it furnished in its registration application (or in later submissions amending that information) remains correct. 49 CFR 592.5(f).

To comply with the statutory directive, we reviewed the existing fees and their bases in an attempt to establish fees that would be sufficient to recover the costs of carrying out the registration program for importers for at least the next two fiscal years. The initial component of the Registration Program Fee is the fee attributable to processing and acting upon registration applications. We will increase this fee from $320 to $330 for new applications. We have also determined that the fee for the review of the annual statement submitted by existing RIs who wish to renew their registrations will be increased from $195 to $201. These fee adjustments reflect our time expenditures in reviewing both new applications and annual statements with accompanying documentation, and the small increases in indirect costs attributed to the agency's overhead costs in the two years since the fees were last adjusted.

We must also recover costs attributable to maintenance of the registration program that arise from the need for us to review a registrant's annual statement and to verify the continuing validity of information already submitted. These costs also include anticipated costs attributable to the possible revocation or suspension of registrations and reflect the amount of time that we have devoted to those matters in the past two years.

Based upon our review of these costs, the portion of the fee attributable to the maintenance of the registration program is approximately $475 for each RI. When this $475 is added to the $330 representing the registration application component, the cost to an applicant for RI status comes to $805, which is the fee we are adopting. This represents an increase of $10 over the existing fee. When the $475 is added to the $201 representing the annual statement component, the total cost to an RI for renewing its registration comes to $676, which represents an increase of $6.

Section 594.6(h) enumerates indirect costs associated with processing the annual renewal of RI registrations. The provision states that these costs represent a pro rata allocation of the average salary and benefits of employees who process the annual statements and perform related functions, and “a pro rata allocation of the costs attributable to maintaining the office space, and the computer or word processor.” For the purpose of establishing the fees that are currently in existence, indirect costs are $20.67 per man-hour. We are increasing this figure by $0.99, to $21.66. This increase is based on the difference between enacted budgetary costs within the Department of Transportation for the last two fiscal years, which were higher than the estimates used when the fee schedule was last amended, and takes into account other projected increases over the next two fiscal years.

Section 30141(a)(3)(B) also requires registered importers to pay other fees the Secretary of Transportation establishes to cover the costs of “making the decisions under this subchapter.” This includes decisions on whether the vehicle sought to be imported is substantially similar to a motor vehicle that was originally manufactured for importation into and sale in the United States and certified by its original manufacturer as complying with all applicable FMVSS, and whether the vehicle is capable of being readily altered to meet those standards. Alternatively, where there is no substantially similar U.S.-certified motor vehicle, the decision is whether the safety features of the vehicle comply with, or are capable of being altered to comply with, the FMVSS based on destructive test information or such other evidence that NHTSA deems to be adequate. These decisions are made in response to petitions submitted by RIs or manufacturers, or on the Administrator's own initiative.

The fee for a vehicle imported under an eligibility decision made in response to a petition is payable in part by the petitioner and in part by other importers. The fee to be charged for each vehicle is the estimated pro rata share of the costs in making all the eligibility decisions in a fiscal year. The agency's direct and indirect costs must be taken into account in the computation of these costs.

Since we last amended the fee schedule, the overall number of vehicle imports by RIs has increased, while the number of petitions has remained approximately the same. The total number of vehicles that RIs imported each year from 2009 to 2011 more than doubled from approximately 10,000 to 23,000, respectively. Over the same period, the number of vehicles imported under an import eligibility petition that was submitted by an RI (as opposed to an import eligibility decision initiated by the agency) increased from 485 in 2009 to 514 in 2010. That number subsequently decreased to 404 in 2011. Because the number of petitions has remained level over the past two years—averaging 12 per year—the agency has devoted approximately the same amount of staff time reviewing and processing import eligibility petitions.

Based on these trends, the pro rata share of petition costs assessed against the importer of each vehicle covered by the eligibility decision will decrease. We project that for FY 2013 and 2014, the agency's annual costs for processing these 12 petitions will be $45,591. The petitioners will pay $4,600 of that amount in the processing fees that accompany the filing of their petitions, leaving the remaining $40,991 to be recovered from the importers of the approximately 404 vehicles projected to be imported under petition-based import eligibility decisions. Dividing $40,991 by 404 yields a pro rata fee of $101 for each vehicle imported under an eligibility decision that results from the granting of a petition. We are therefore decreasing the pro rata share of petition costs that are to be assessed against the importer of each vehicle from $158 to $101, which represents a decrease of $57. The same $101 fee would be paid regardless of whether the vehicle was petitioned under 49 CFR 593.6(a), based on the substantial similarity of the vehicle to a U.S.-certified model, or was petitioned under 49 CFR 593.6(b), based on the safety features of the vehicle complying with, or being capable of being modified to comply with, all applicable FMVSS.

We are not increasing the current fee of $175 that covers the initial processing of a “substantially similar” petition. Likewise, we are also maintaining the existing fee of $800 to cover the initial costs for processing petitions for vehicles that have no substantially similar U.S.-certified counterpart. In the event that a petitioner requests an inspection of a vehicle, the fee for such an inspection will remain $827 for vehicles that are the subject of either type of petition.

The importation fee varies depending upon the basis on which the vehicle is determined to be eligible. For vehicles covered by an eligibility decision on the agency's own initiative (other than vehicles imported from Canada that are covered by import eligibility numbers VSA-80 through 83, for which no eligibility decision fee is assessed), the fee remains $125. NHTSA determined that the costs associated with previous eligibility determinations on the agency's own initiative would be fully recovered by October 1, 2012. We will apply the fee of $125 per vehicle only to vehicles covered by determinations made by the agency on its own initiative on or after October 1, 2012.

Section 30141(a)(3) also requires a registered importer to pay any other fees the Secretary of Transportation establishes “to pay for the costs of—(A) processing bonds provided to the Secretary of the Treasury * * *” upon the importation of a nonconforming vehicle to ensure that the vehicle would be brought into compliance within a reasonable time, or if it is not brought into compliance within such time, that it be exported, without cost to the United States, or abandoned to the United States.

The Department of Homeland Security (Customs) exercises the functions associated with the processing of these bonds. To carry out the statute, we make a reasonable determination of the costs that Department incurs in processing the bonds. In essence, the cost to Customs is based upon an estimate of the time that a GS-9, Step 5 employee spends on each entry, which Customs has judged to be 20 minutes.

When the fee schedule was last amended, we projected General Schedule salary raises to be effective in January 2011 and 2012. Based on our projections over the next two fiscal years, we are decreasing the processing fee by $0.84, from $9.93 per bond to $9.09. This decrease reflects the fact that GS-9 salaries have been frozen since we last amended the fee schedule in 2010. The $9.09 fee will more closely reflect the direct and indirect costs that are actually associated with processing the bonds.

In lieu of sureties on a DOT conformance bond, an importer may offer United States money, United States bonds (except for savings bonds), United States certificates of indebtedness, Treasury notes, or Treasury bills (collectively referred to as “cash deposits”) in an amount equal to the amount of the bond. 49 CFR 591.10(a). The receipt, processing, handling, and disbursement of the cash deposits that have been tendered by RIs cause the agency to consume a considerable amount of staff time and material resources. NHTSA has concluded that the expense incurred by the agency to receive, process, handle, and disburse cash deposits may be treated as part of the bond processing cost, which NHTSA is authorized to set a fee under 49 U.S.C. 30141(a)(3)(A). We first established a fee of $459 for each vehicle imported on and after October 1, 2008, for which cash deposits or obligations of the United States are furnished in lieu of a conformance bond. See the Final Rule published on July 11, 2008 at 73 FR 39890.

The agency considered its direct and indirect costs in calculating the fee for the review, processing, handling, and disbursement of cash deposits submitted by importers and RIs in lieu of sureties on a DOT conformance bond. We are decreasing the fee from $514 to $495. The factors that the agency has taken into account in proposing the fee include time expended by agency personnel, the slight increase in overhead costs, and the reduction in projected salary costs based on the General Schedule salary freeze since January 2010.

Each RI is currently required to pay $17 per vehicle to cover the costs the agency incurs in reviewing a certificate of conformity. We have found that these costs have decreased from $17 to an average of $12 per vehicle. Although our overhead costs increased, the salary and benefit costs are less than our previous projections based on the General Schedule salary freeze. The number of certificates of conformity submitted for agency review has increased. This has decreased the agency's cost attributed to the review of each certificate of conformity. Based on these costs, we are decreasing the fee charged for vehicles for which a paper entry and fee payment is made, from $17 to $12, a difference of $5 per vehicle. However, if an RI enters a vehicle through the Automated Broker Interface (ABI) system, has an email address to receive communications from NHTSA, and pays the fee by credit card, the cost savings that we realize allow us to significantly reduce the fee to $6. We are maintaining the fee of $6 per vehicle if all the information in the ABI entry is correct.

Errors in ABI entries not only eliminate any time savings, but also require additional staff time to be expended in reconciling the erroneous ABI entry information to the conformity data that is ultimately submitted. Our experience with these errors has shown that staff members must examine records, make time-consuming long distance telephone calls, and often consult supervisory personnel to resolve the conflicts in the data. We have calculated this staff and supervisory time, as well as the telephone charges, to amount to approximately $57 for each erroneous ABI entry. Adding this to the $6 fee for the review of conformity packages on automated entries yields a total of $63, representing no increase in the fee that is currently charged when there are one or more errors in the ABI entry or in the statement of conformity.

NHTSA is required under 49 U.S.C. 30141(e) to “review and make appropriate adjustments at least every 2 years in the amounts of the fees” relating to the registration of importers, the processing of bonds, and making decisions concerning the importation of nonconforming vehicles. The statute further requires the agency to “establish the fees for each fiscal year before the beginning of that year.” This final rule implements the statutory provisions. In the NPRM, we proposed to make this rule effective October 1, 2012, and did not receive any comments on this issue. Accordingly, the effective date of this final rule is October 1, 2012.

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

(1) Have an annual effect on the economy of $100 million or more or adversely 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;

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

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

(4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the Executive Order.

NHTSA has considered the impact of this rulemaking action under Executive Order 12866 and the Department of Transportation's regulatory policies and procedures. This rulemaking is not significant. Accordingly, the Office of Management and Budget has not reviewed this rulemaking document under Executive Order 12886. Further, NHTSA has determined that the rulemaking is not significant under Department of Transportation's regulatory policies and procedures. Based on the level of the fees and the volume of affected vehicles, NHTSA currently anticipates that the costs of the final rule would be so minimal as not to warrant preparation of a full regulatory evaluation. The action does not involve any substantial public interest or controversy. The rule will have no substantial effect upon State and local governments. There will be no substantial impacts upon a major transportation safety program. A regulatory evaluation analyzing the economic impact of the final rule establishing the registered importer program, adopted on September 29, 1989, was prepared, and is available for review.

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 of proposed rulemaking for any proposed or final rule, it must prepare and make available for public comment a regulatory flexibility analysis that describes the effect of the rule on small entities (i.e., small businesses, small organizations, and small governmental jurisdictions). 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 is required if the head of an agency certifies that the rule would 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 would not have a significant economic impact on a substantial number of small entities.

The agency has considered the effects of this rulemaking under the Regulatory Flexibility Act, and certifies that the rules being adopted will not have a significant economic impact upon a substantial number of small entities.

The following is NHTSA's statement providing the factual basis for the certification (5 U.S.C. 605(b)). The adopted amendments will primarily affect entities that currently modify nonconforming vehicles and that are small businesses within the meaning of the Regulatory Flexibility Act; however, the agency has no reason to believe that these companies would be unable to pay the fees proposed by this action. In most instances, these fees would not be changed or be only modestly increased (and in some instances decreased) from the fees now being paid by these entities. Moreover, consistent with prevailing industry practices, these fees should be passed through to the ultimate purchasers of the vehicles that are altered and, in most instances, sold by the affected registered importers. The cost to owners or purchasers of nonconforming vehicles that are altered to conform to the FMVSS may be expected to increase (or decrease) to the extent necessary to reimburse the registered importer for the fees payable to the agency for the cost of carrying out the registration program and making eligibility decisions, and to compensate Customs for its bond processing costs.

Governmental jurisdictions will not be affected at all since they are generally neither importers nor purchasers of nonconforming motor vehicles.

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 the rule does not have sufficient federalism implications to warrant either consultation with State and local officials or preparation of a federalism summary impact statement. The 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 the responsibilities among the various levels of government.”

Further, no consultation is needed to discuss the issue of preemption in connection with today's final rule. The issue of preemption can arise in connection with NHTSA rules 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 that unavoidably preempts State legislative and administrative law, not today's rulemaking, so consultation is unnecessary.

Second, the Supreme Court has recognized the possibility of implied preemption: In some instances, State requirements imposed on motor vehicle manufacturers, including sanctions imposed by State tort law, can stand as an obstacle to the accomplishment and execution of some of the NHTSA safety standards. When such a conflict is discerned, the Supremacy Clause of the Constitution makes the State requirements unenforceable. See Geier v. American Honda Motor Co., 529 U.S. 861 (2000).

NHTSA has considered the nature (e.g., the language and structure of the regulatory text) and purpose of today's final rule and does not foresee any potential State requirements that might conflict with it. Without any conflict, there could not be any implied preemption of state law, including state tort law.

NHTSA has analyzed this action for purposes of the National Environmental Policy Act. The action will not have a significant effect upon the environment because it is anticipated that the annual volume of motor vehicles imported through registered importers will not vary significantly from that existing before promulgation of the rule.

Pursuant to Executive Order 12988 “Civil Justice Reform,” the agency has considered whether the amendments adopted in this final rule will have any retroactive effect. NHTSA concludes that those amendments will not have any retroactive effect. Judicial review of the rule may be obtained pursuant to 5 U.S.C. 702. That section does not require that a petition for reconsideration be filed prior to seeking judicial review.

Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) requires agencies to prepare a written assessment of the costs, benefits, and other effects of proposed or final rules that include a Federal mandate likely to result in the expenditure by State, local, or tribal governments, in the aggregate, or by the private sector, of more than $100 million annually (adjusted for inflation with the base year of 1995). Before promulgating a rule for which a written assessment is needed, Section 205 of the UMRA generally requires NHTSA to identify and consider a reasonable number of regulatory alternatives and to adopt the least costly, most cost-effective, or least burdensome alternative that achieves the objectives of the rule. The provisions of Section 205 do not apply when they are inconsistent with applicable law. Moreover, Section 205 allows NHTSA to adopt an alternative other than the least costly, most cost-effective or least burdensome alternative if the agency publishes with the final rule an explanation why that alternative was not adopted. Because this final rule will not require the expenditure of resources beyond $100 million annually, this action is not subject to the requirements of Sections 202 and 205 of the UMRA.

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 OMB control number. Part 594 includes collections of information for which NHTSA has obtained OMB Clearance No. 2127-0002, a consolidated collection of information for “Importation of Vehicles and Equipment Subject to the Federal Motor Vehicle Safety, Bumper and Theft Prevention Standards,” approved through January 31, 2014. This final rule will not affect the burden hours associated with Clearance No. 2127-0002 because we are only adjusting the fees associated with participating in the registered importer program. The new fees that we are adopting will not impose new collection of information requirements or otherwise affect the scope of the program.

Executive Order 13045, “Protection of Children from Environmental Health and Safety Risks” (62 FR 19855, April 23, 1997), applies to any rule that (1) is determined to be “economically significant” as defined under E.O. 12866, and (2) concerns an environmental, health, or safety risk that NHTSA has reason to believe may have a disproportionate effect on children. If the regulatory action meets both criteria, we must evaluate the environmental health or safety effects of the planned rule on children, and explain why the planned rule is preferable to other potentially effective and reasonably feasible alternatives considered by us. This rulemaking is not economically significant and does not concern an environmental, health, or safety risk.

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA), Public Law 104-113, (15 U.S.C. 272) directs the agency 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 it decides not to use available and applicable voluntary consensus standards.

In this final rule, we are adjusting the fees associated with the registered importer program. We are making no substantive changes to the program nor did we adopt any technical standards. For these reasons, Section 12(d) of the NTTAA does not apply.

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

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 that appears in the heading on the first page of this document to find this action in the Unified Agenda.

In consideration of the foregoing, 49 CFR Part 594 is amended as follows:

Correction

On July 27, 2012 (77 FR 44168, July 27, 2012), incorrect latitudinal coordinates for Lobster Trap Gear Closed Areas 16 and 17, and longitudinal coordinates for Lobster Trap Gear Closed Area 18 were published. In rule document 2012-18303 appearing on pages 44168-44172 in the issue of Friday July 27, 2012, make the following corrections: