This rule is issued under Marketing Order No. 927, as amended (7 CFR part 927), regulating the handling of pears grown in Oregon and Washington, hereinafter referred to as the “order.” The order is effective under the Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-674), hereinafter referred to as the “Act.”

The Department of Agriculture (USDA) is issuing this rule in conformance with Executive Order 12866.

This rule has been reviewed under Executive Order 12988, Civil Justice Reform. Under the marketing order now in effect, Oregon-Washington pear handlers are subject to assessments. Funds to administer the order are derived from such assessments. It is intended that the assessment rate as issued herein will be applicable to all assessable summer/fall processed pears beginning July 1, 2012, and continue until amended, suspended, or terminated.

The Act provides that administrative proceedings must be exhausted before parties may file suit in court. Under section 608c(15)(A) of the Act, any handler subject to an order may file with USDA a petition stating that the order, any provision of the order, or any obligation imposed in connection with the order is not in accordance with law and request a modification of the order or to be exempted therefrom. Such handler is afforded the opportunity for a hearing on the petition. After the hearing, USDA would rule on the petition. The Act provides that the district court of the United States in any district in which the handler is an inhabitant, or has his or her principal place of business, has jurisdiction to review USDA's ruling on the petition, provided an action is filed not later than 20 days after the date of the entry of the ruling.

This rule decreases the assessment rate established for the Committee for the 2012-2013 and subsequent fiscal periods from $7.73 to $7.00 per ton for summer/fall processed pears handled. The assessment rate for “winter” and “other” pears for processing would remain unchanged at a zero rate.

The order provides authority for the Committee, with USDA approval, to formulate an annual budget of expenses and to collect assessments from handlers to administer the processed pear program. The members of the Committee are producers, handlers, and processors of Oregon-Washington processed pears. They are familiar with the Committee's needs and with the costs for goods and services in their local area and are thus in a position to formulate an appropriate budget and assessment rate. The assessment rate is formulated and discussed at a public meeting. Thus, all directly affected persons have an opportunity to participate and provide input.

For the 2011-2012 and subsequent fiscal periods, the Committee unanimously recommended, and USDA approved, the following three base rates of assessment: (a) $7.73 per ton for any or all varieties or subvarieties of pears for canning classified as “summer/fall,” excluding pears for other methods of processing; (b) $0.00 per ton for any or all varieties or subvarieties of pears for processing classified as “winter”; and (c) $0.00 per ton for any or all varieties or subvarieties of pears for processing classified as “other.” The assessment rate for “summer/fall” pears applies only to pears for canning and excludes pears for other methods of processing as defined in § 927.15, which includes pears for concentrate, freezing, dehydrating, pressing, or in any other way to convert pears into a processed product. This rate would continue in effect from fiscal period to fiscal period unless modified, suspended, or terminated by USDA upon recommendation and information submitted by the Committee or other information available to USDA.

The Committee met on May 30, 2012, and unanimously recommended 2012-2013 expenditures of $842,137 and an assessment rate of $7.00 per ton for summer/fall processed pears handled. In comparison, last year's budgeted expenditures were $926,933. The assessment rate of $7.00 is $0.73 lower than the 2011-2012 rate. The Committee recommended the assessment rate decrease because of the 2012-2013 summer/fall processed pear promotion budget reduction.

The major expenditures recommended by the Committee for the 2012-2013 fiscal period include $654,000 for promotion and paid advertising, $137,447 for research programs, $24,000 for contracted administration by Washington State Fruit Commission, and $12,500 for market access and trade policy. In comparison, major expenses for the 2011-2012 fiscal period included $759,000 for promotion and paid advertising, $117,243 for research programs, $24,000 for contracted administration by Washington State Fruit Commission, and $12,500 for market access and trade policy.

The Committee based its recommended assessment rate for processed pears on the 2012-2013 summer/fall processed pear crop estimate, the 2012-2013 program expenditure needs, and the current and projected size of its monetary reserve. Applying the $7.00 per ton rate to the Committee's 120,000 ton summer/fall processed pear crop estimate should provide $840,000 in assessment income. Thus, income derived from summer/fall processed pear handler assessments, and interest and other income ($500) plus $1,637 from the Committee's monetary reserve would be adequate to cover the recommended $842,137 budget for 2012-2013. The Committee estimates that it will have a monetary reserve of $618,804 on June 30, 2012. During 2012-2013, the Committee estimates that $1,637 will be deducted from the reserve for an estimated reserve of $617,167 on June 30, 2013, which would be within the maximum permitted by the order of approximately one fiscal period's operational expenses (§ 927.42).

The assessment rate established in this rule will continue in effect indefinitely unless modified, suspended, or terminated by USDA upon recommendation and information submitted by the Committee or other available information.

Although this assessment rate is effective for an indefinite period, the Committee will continue to meet prior to or during each fiscal period to recommend a budget of expenses and consider recommendations for modification of the assessment rate. The dates and times of Committee meetings are available from the Committee or USDA. Committee meetings are open to the public and interested persons may express their views at these meetings. USDA will evaluate Committee recommendations and other available information to determine whether modification of the assessment rate is needed. Further rulemaking will be undertaken as necessary. The Committee's 2012-2013 budget and those for subsequent fiscal periods will be reviewed and, as appropriate, approved by USDA.

Pursuant to requirements set forth in the Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612), the Agricultural Marketing Service (AMS) has considered the economic impact of this rule on small entities. Accordingly, AMS has prepared this initial regulatory flexibility analysis.

The purpose of the RFA is to fit regulatory actions to the scale of business subject to such actions in order that small businesses will not be unduly or disproportionately burdened. Marketing orders issued pursuant to the Act, and the rules issued thereunder, are unique in that they are brought about through group action of essentially small entities acting on their own behalf.

There are approximately 1,500 producers of processed pears in the regulated production area and approximately 50 handlers of processed pears subject to regulation under the order. Small agricultural producers are defined by the Small Business Administration (SBA)(13 CFR 121.201) as those having annual receipts of less than $750,000, and small agricultural service firms are defined as those whose annual receipts are less than $7,000,000.

According to the Noncitrus Fruits and Nuts 2011 Preliminary Summary issued in March 2012 by the National Agricultural Statistics Service, the total farm-gate value of summer/fall processed pears grown in Oregon and Washington for 2011 was $35,315,000. Based on the number of processed pear producers in the Oregon and Washington, the average gross revenue for each producer can be estimated at approximately $23,543. Furthermore, based on Committee records, the Committee has estimated that all of the Oregon-Washington pear handlers currently ship less than $7,000,000 worth of processed pears each on an annual basis. From this information, it is concluded that the majority of producers and handlers of Oregon and Washington processed pears may be classified as small entities.

There are three pear processing plants in the production area, all located in Washington. All three pear processors would be considered large entities under the SBA's definition of small businesses.

This rule decreases the assessment rate established for the Committee and collected from handlers for the 2012-2013 and subsequent fiscal periods from $7.73 to $7.00 per ton of processed pears handled. The Committee unanimously recommended 2012-2013 expenditures of $842,137 and an assessment rate of $7.00 per ton of summer/fall processed pears handled. The assessment rate of $7.00 is $0.73 lower than the 2011-2012 rate. The Committee recommended the assessment rate decrease because of the 2012-2013 summer/fall processed pear promotion budget reduction.

The quantity of assessable summer/fall processed pears for the 2012-2013 fiscal period is estimated at 120,000 tons. Thus, the $7.00 rate should provide $840,000 in assessment income. Income derived from summer/fall processed pear handler assessments, monetary reserve, and interest and other income would be adequate to cover the budgeted expenses.

The major expenditures recommended by the Committee for the 2012-2013 fiscal period include $654,000 for promotion and paid advertising, $137,442 for research programs, $24,000 for contracted administration by Washington State Fruit Commission, and $12,500 for market access and trade policy. Budgeted expenses for these items in the 2011-2012 fiscal period were $759,000, $117,243, $24,000, and $12,500, respectively.

The Committee discussed alternate rates of assessment, but determined that the recommended assessment rate would be sufficient to fund the 2012-2013 summer/fall processed pear programs.

A review of historical information and preliminary information pertaining to the upcoming fiscal period indicates that the Oregon-Washington producer price for the 2012-2013 fiscal period could average $246 per ton of summer/fall processed pears. Therefore, the estimated assessment revenue for the 2012-2013 fiscal period as a percentage of total producer revenue is 2.85 percent.

This action decreases the assessment obligation imposed on handlers. Assessments are applied uniformly on all handlers, and some of the costs may be passed on to producers. However, decreasing the assessment rate reduces the burden on handlers, and may reduce the burden on producers.

In addition, the Committee's meeting was widely publicized throughout the Oregon-Washington pear industry and all interested persons were invited to attend the meeting and participate in Committee deliberations on all issues. Like all Committee meetings, the May 30, 2012, meeting was a public meeting and all entities, both large and small, were able to express views on this issue. Finally, interested persons are invited to submit comments on this interim rule, including the regulatory and informational impacts of this action on small businesses.

In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), the order's information collection requirements have been previously approved by the Office of Management and Budget (OMB) and assigned OMB No. 0581-0189, Generic Fruit Crops. No changes in those requirements as a result of this action are anticipated. Should any changes become necessary, they would be submitted to OMB for approval.

This action imposes no additional reporting or recordkeeping requirements on either small or large Oregon-Washington processed pear handlers. As with all Federal marketing order programs, reports and forms are periodically reviewed to reduce information requirements and duplication by industry and public sector agencies.

AMS is committed to complying with the E-Government Act, to promote the use of the Internet and other information technologies to provide increased opportunities for citizen access to Government information and services, and for other purposes.

USDA has not identified any relevant Federal rules that duplicate, overlap, or conflict with this rule.

A small business guide on complying with fruit, vegetable, and specialty crop marketing agreements and orders may be viewed at: www.ams.usda.gov/MarketingOrdersSmallBusinessGuide. Any questions about the compliance guide should be sent to Laurel May at the previously mentioned address in the FOR FURTHER INFORMATION CONTACT section.

After consideration of all relevant material presented, including the information and recommendation submitted by the Committee and other available information, it is hereby found that this rule, as hereinafter set forth, will tend to effectuate the declared policy of the Act.

Pursuant to 5 U.S.C. 553, it is also found and determined upon good cause that it is impracticable, unnecessary, and contrary to the public interest to give preliminary notice prior to putting this rule into effect, and that good cause exists for not postponing the effective date of this rule until 30 days after publication in the Federal Register because: (1) The 2012-2013 fiscal period begins on July 1, 2012, and the marketing order requires that the rate of assessment for each fiscal period apply to all assessable processed pears handled during such fiscal period; (2) this action decreases the assessment rate for assessable processed pears beginning with the 2012-2013 fiscal period; (3) handlers are aware of this action which was unanimously recommended by the Committee at a public meeting and is similar to other assessment rate actions issued in past years; and (4) this interim rule provides a 60-day comment period, and all comments timely received will be considered prior to finalization of this rule.

For the reasons set forth in the preamble, 7 CFR part 927 is amended as follows:

On July 6, 2012 (77 FR 39899), the NRC published a final rule in the Federal Register amending its regulations to make technical corrections. This document is necessary to correct the statutory authority that is cited in the authority citation for part 171 of Title 10 of the Code of Federal Regulations (10 CFR). The authority citation for 10 CFR part 171 referred to section 6101 of the Consolidated Omnibus Budget Reconciliation Act. The authority citation should refer to section 7601 of the Act.

Because this amendment constitutes a minor technical correction to the NRC's regulations and the authority citation for the prior technical corrections rulemaking, the Commission finds that the notice and comment provisions of the Administrative Procedure Act are unnecessary and is exercising its authority under 5 U.S.C. 553(b)(3)(B) to publish these amendments as a final rule. These amendments do not require action by any person or entity regulated by the NRC. Also, the final rule does not change the substantive responsibilities of any person or entity regulated by the NRC.

For the reasons set out in the preamble and under the authority of the Atomic Energy Act of 1954, as amended; the Energy Reorganization Act of 1974, as amended; and 5 U.S.C. 552 and 553, 10 CFR part 171 is corrected by making the following correcting amendment.

Discussion

We have received reports of fuel leaks on two different in-service airplanes, and the subsequent discovery of several improperly assembled engine fuel feed manifold couplings on in-service and production airplanes. The improper coupling installations, which occurred during production, have included couplings with missing or improperly installed lockwire, parts within the couplings installed in the wrong locations, incorrect parts installed in the couplings, and couplings that have extra parts installed. These conditions, if not corrected, could result in fuel leaks, which could lead to fuel exhaustion, engine power loss or shutdown, or leaks on hot engine parts that could lead to a fire.

We reviewed Boeing Multi Operator Message MOM-MOM-12-0838-01B(R2), including Attachment A, dated November 25, 2012. For information on the procedures and compliance times, see this service information at http://www.regulations.gov by searching for Docket No. FAA-2012-1220.

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

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

The phrase “related investigative actions” might be used in this AD. “Related investigative actions” are follow-on actions that (1) are related to the primary actions, and (2) further investigate the nature of any condition found. Related investigative actions in an AD could include, for example, inspections.

In addition, the phrase “corrective actions” might be used in this AD. “Corrective actions” are actions that correct or address any condition found. Corrective actions in an AD could include, for example, repairs.

For engine fuel feed manifold couplings that have not been previously inspected, Boeing Multi Operator Message MOM-MOM-12-0838-01B(R2), including Attachment A, dated November 25, 2012, recommends accomplishment of all actions specified in Action 1) within 7 days. This AD, however, requires only that operators ensure the correct lockwire installation within 7 days; the compliance time for the remaining actions is 21 days. We have determined that the additional time for the remaining actions is warranted, based on the assurance that the lockwire is installed correctly.

In addition, for engine fuel feed manifold full flexible couplings that have been previously inspected, Boeing Multi Operator Message MOM-MOM-12-0838-01B(R2), including Attachment A, dated November 25, 2012, specifies that operators do not need to re-inspect these couplings if review of the airplane maintenance records conclusively demonstrates that the corresponding actions are equivalent to steps 1 through 6 of Action 1) of Boeing Multi Operator Message MOM-MOM-12-0838-01B(R2), including Attachment A, dated November 25, 2012. We have determined that the potential for not identifying incorrect parts during prior inspection of the full flexible coupling warrants re-inspecting these couplings; this AD therefore requires inspection of these full flexible couplings.

These differences have been coordinated with Boeing.

An unsafe condition exists that requires the immediate adoption of this AD. The FAA has found that the risk to the flying public justifies waiving notice and comment prior to adoption of this rule because improperly assembled engine fuel feed manifold couplings could result in fuel leaks and consequent fuel exhaustion, engine power loss or shutdown, or leaks on hot engine parts that could lead to a fire. Therefore, we find that notice and opportunity for prior public comment are impracticable and that good cause exists for making this amendment effective in less than 30 days.

This AD is a final rule that involves requirements affecting flight safety and was not preceded by notice and an opportunity for public comment. However, we invite you to send any written data, views, or arguments about this AD. Send your comments to an address listed under the ADDRESSES section. Include the docket number FAA-2012-1220 and Directorate Identifier 2012-NM-208-AD at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this AD. We will consider all comments received by the closing date and may amend this AD because of those comments.

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

We estimate that this AD affects 3 airplanes of U.S. registry. We estimate the following costs to comply with this AD:

We have received no definitive data that would enable us to provide cost estimates for the on-condition actions specified in this proposed AD.

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

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

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:

Discussion

We received a report of an HET turbocharger turbine wheel that failed a static strength test at its manufacturing facility. Subsequent tests showed that nearly all turbine wheels, P/N 410188-0019, had significant cracking under the surface of a critical weld joint between the turbine wheel head and shaft that occurred during manufacturing. HET has identified by serial number (S/N) the turbochargers shipped from the factory with this unsafe condition. HET has also identified the S/N range of affected turbine wheels. Some of the affected turbine wheels became available for overhaul or field repair since August 29, 2012, and may have been installed. This condition, if not corrected, could result in turbocharger turbine wheel failure, reduction or complete loss of engine power, loss of engine oil, oil fire, and damage to the airplane.

We reviewed HET Alert Service Bulletin (ASB) No. 048, dated November 16, 2012. The ASB lists the known serial numbers of affected turbochargers.

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

This AD requires removing the affected turbochargers from service before further flight.

An unsafe condition exists that requires the immediate adoption of this AD. The FAA has found that the risk to the flying public justifies waiving notice and comment prior to adoption of this rule because HET cannot confirm the affected turbochargers can safely be used. Therefore, we find that notice and opportunity for prior public comment are impracticable and that good cause exists for making this amendment effective in less than 30 days.

This AD is a final rule that involves requirements affecting flight safety and was not preceded by notice and an opportunity for public comment. However, we invite you to send any written data, views, or arguments about this AD. Send your comments to an address listed under the ADDRESSES section. Include the docket number FAA-2012-1245 and Directorate Identifier 2012-NE-41-AD at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this AD. We will consider all comments received by the closing date and may amend this AD because of those comments.

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

We estimate that this AD affects 56 airplanes of U.S. registry with affected turbochargers installed. We also estimate that it will take about 4 hours to remove a turbocharger from service. The average labor rate is $85 per hour. Based on these figures, we estimate the total cost of the AD to U.S. operators to be $19,040.

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:

I. Introduction A. What is the purpose of the final rule?

The final rule amends 16 CFR 1107.21 and 1107.26 of the Commission's regulation on testing and labeling pertaining to product certification in order to implement the statutory requirement in section 14(i)(2)(B) of the CPSA for the periodic testing of representative samples of children's products, as well as associated recordkeeping.

Section 14(a)(2) of the CPSA, 15 U.S.C. 2063(a)(2), requires manufacturers, including importers, and private labelers of any children's product that is subject to a children's product safety rule, to submit sufficient samples of the product, or samples that are identical in all material respects to the product, to a third party conformity assessment body whose accreditation has been accepted by the CPSC, to be tested for compliance with such children's product safety rule. Based on that testing, the manufacturer or private labeler must issue a certificate, which certifies that such children's product complies with the children's product safety rule. 15 U.S.C. 2063(a)(2)(B). A children's product certifier must issue a separate certificate for each applicable children's product safety rule, or a combined certificate that certifies compliance with all applicable children's product safety rules, and specifies each rule. This certificate is called a Children's Product Certificate (CPC).

Section 14(i)(2)(B) of the CPSA, 15 U.S.C. 2063(i)(2)(B), as originally provided in section 102 of the Consumer Product Safety Improvement Act of 2008 (CPSIA) prior to amendment, requires, in relevant part, that we establish protocols and standards for “ensuring that a children's product tested for compliance with a children's product safety rule is subject to testing periodically and when there has been a material change in the product's design or manufacturing process, including the sourcing of component parts,” and the “testing of random samples to ensure continued compliance.”

In the Federal Register of May 20, 2010 (75 FR 28336), we published a proposed rule on “Testing and Labeling Pertaining to Product Certification.” The proposed rule was intended to implement parts of what was then known as section 14(d)(2)(B) of the CPSA (now renumbered section 14(i)(2)(B)) and to implement parts of section 14(a) of the CPSA. Proposed § 1107.22, “Random Samples,” would have implemented the testing of random samples' requirement in the CPSA, by requiring each manufacturer of a children's product to select samples for periodic testing by using a process that assigns each sample in the production population an equal probability of being selected (75 FR at 28349 through 28350, 28365).

On August 12, 2011, the President signed into law Public Law 112-28. Among other things, Public Law 112-28 changed the obligation for the testing of “random samples” to the testing of “representative samples.” Additionally, Public Law 112-28 corrected an editorial error in section 14 of the CPSA, by renumbering section 14(d) of the CPSA, “Additional Regulations for Third Party Testing,” as section 14(i) of the CPSA.

On November 8, 2011, we published a final rule in the Federal Register (76 FR 69482) for the testing and labeling rule, 16 CFR part 1107, on those aspects of the rule left unchanged by Public Law 112-28. However, because Public Law 112-28 amended section 14(i)(2)(B)(ii) of the CPSA to require the testing of “representative samples,” the Commission deleted § 1107.22 from the final rule on testing and labeling, and it issued a proposed rule (76 FR 69586), also on November 8, to implement the new statutory requirement for the testing of representative samples.

The Commission is now issuing a final rule amending 16 CFR 1107.21(f) and 1107.26(a)(4) to implement the requirement to test “representative samples,” pursuant to section 14(i)(2)(B)(ii) of the CPSA, as well as our implementing authority under section 3 of the CPSIA.

The final rule amends § 1107.21(f) to require a manufacturer to select representative product samples to be submitted to a third party conformity assessment body for periodic testing. The procedure used to select representative product samples for periodic testing must provide a basis for inferring compliance about the population of untested products produced during the applicable periodic testing interval. The number of samples selected for the sampling procedure must be sufficient to ensure continuing compliance with all applicable children's product safety rules. Moreover, a manufacturer must document the procedure used to select representative product samples for periodic testing and the basis for inferring the compliance of the product manufactured during the periodic testing interval from the results of the tested samples.

The final rule also amends § 1107.26(a)(4) to require a manufacturer of a children's product subject to an applicable children's product safety rule to maintain records documenting the testing of representative samples, including the number of representative samples selected and the procedure used to select representative samples. Records also must include the basis for inferring compliance of the product manufactured during the periodic testing interval from the results of the tested samples. Existing § 1107.26(b) requires that records be maintained for five years.

Under the final rule, various methods can be used to determine that the selected samples are representative, depending upon on the rule, ban, standard, or regulation being evaluated. For example, for the chemical tests, a sample selected from a homogeneous material, such as a well-mixed container of paint, could be considered representative of the entire container. For discretely produced products, information indicating uniform materials and dimensional control could be used to indicate that a sample is representative of the product for mechanical tests. For example, if a bicycle handlebar sample is manufactured from the same grade of steel and with the same dimensions ( e.g., wall thickness, length, shape, placement of holes for attaching brake levers) as other handlebars produced, then that handlebar sample can be considered representative of the population of handlebars for the purpose of complying with the handlebar stem test in 16 CFR 1512.18(g).

Other methods may be used to establish that samples selected for periodic testing are representative—with respect to compliance—of the population of products manufactured since the last periodic test. Examples of such methods include: Inspecting incoming raw materials or component parts; generating process control data during product manufacture; and using manufacturing techniques with intrinsic manufacturing uniformity, such as die casting.

Random sampling is another way of selecting representative samples that provides a basis for inferring the compliance of untested product units from the tested product units. The conditions that allow for the inference of compliance concerning untested units versus tested units may be met by a range of probability-based sampling designs, including, but not limited to, simple random sampling, cluster sampling, systematic sampling, stratified sampling, and multistage sampling. These methods allow the manufacturer the flexibility to select a random sampling procedure that is most appropriate for the manufacturer's product production setting but still allow for the inference about the compliance of the population of product units. For example, alternative sampling procedures—like systematic sampling (where a starting unit is randomly selected and then every k th unit after that is selected) or multistage sampling (where units are grouped in clusters, such as pallets, the clusters are randomly selected, and then units within the selected clusters are randomly drawn)—can be employed for products for which such sampling procedures would be beneficial. Even though every unit produced does not have the same probability of selection for testing in these examples, these techniques can be used to infer the compliance of the untested units. It should be noted, however, that just because random sampling can be used as one method of conducting representative testing, it is by no means the only method to meet the new broader “representative” sampling requirement in Public Law 112-28.

With evidence that the samples submitted to a third party conformity assessment body are representative of the children's product produced since the last periodic test (or since product certification for the first periodic test interval), the manufacturer can infer the compliance of the untested units.

For the purposes of periodic testing, passing test results means the samples tested are in compliance with the applicable children's product safety rule. Most children's product safety rules require each product sample submitted to pass the prescribed tests. For example, each pacifier subjected to the guard and shield testing specified in 16 CFR 1511.3 must pass the test. In a similar manner, each infant walker submitted for testing must pass the tests prescribed in 16 CFR part 1216.

However, for some children's product standards, compliance with the standard can include individual test results that exceed a specified maximum. For example, for children's products tested for compliance to 16 CFR part 1611, Standard for the flammability of vinyl plastic film, the burn rate of 10 samples is averaged to determine if the average exceeds the maximum burn rate of 1.2 inches per second, as specified in 16 CFR 1611.3. Because the maximum burn rate requirement in part 1611 applies to the average burn rate of the 10 samples tested, it is possible for one or more of the tested samples to exceed the maxiumum burn rate when tested. In this example, if the average burn rate does not exceed 1.2 inches per second, the samples are considered to be in conformance with the standard and have passed the test.

As another example, small carpets and rugs that are children's products are subject to the requirements for periodic testing. For small carpets and rugs, at least seven of the eight samples tested for compliance to 16 CFR part 1631, Standard for the surface flammability of small carpets and rugs (FF 2-70), must meet the test criterion specified in § 1631.3(b). Alternatively, a small carpet or rug that does not meet the test criterion must be permanently labeled prior to its introduction into commerce. Small carpets and rugs that meet either condition would be considered to be in compliance with 16 CFR part 1631 and deemed to have passed the periodic tests.

Manufacturers must document periodic testing of representative samples. Documentation must include the number of representative samples selected, how the samples were selected, and the manufacturer's basis for inferring compliance of the untested units during the testing interval, based on testing of the sampled units. Such documentation must be maintained for five years.

The comment period for the proposed rule closed on January 23, 2012. Eight commenters responded. A summary of these comments and the Commission's responses are set forth below in section II.B of this preamble. Additionally, on November 8, 2011, a request for comments titled, Application of Third Party Testing Requirements; Reducing Third Party Testing Burdens, Docket CPSC-2011-0081, was published in the Federal Register (76 FR 69596). Some of the comments received in that docket also address the testing of representative samples. We summarize and respond to those comments in section II.B, as well, to ensure that all comments on representative samples were considered as part of this rulemaking, in addition to any suggestions for amending the final rule. After consideration of all the comments, however, no changes were made to the final rule.

A summary of the commenters' topics is presented below, followed by staff's responses. For ease of reading, each comment will be prefaced with a numbered “Comment”; and each response will be prefaced by a numbered “Response.” The numbering is for identification purposes only and does not imply the importance of the comment or the order in which it was received.

(Comment 1)—A commenter welcomes the change from random sampling (in the 16 CFR part 1107 NPR) to representative sampling in the proposed rule because the proposed rule includes a variety of methods to assure compliance.

(Response 1)—As long as the test results from the representative samples can infer compliance of the untested units of the children's product, a variety of means can be employed, at the manufacturer's discretion, to select samples for testing under the final rule.

(Comment 2)—A commenter asserts that:

(Response 2)—We agree with the commenter that a clear understanding of “representative samples” will help to implement the required periodic testing of such samples effectively. For this reason, we define a “representative sample” in proposed § 1107.21(f) as one that provides the manufacturer with a basis for inferring the compliance of the untested units of the product population from the tested units. In other words, the manufacturer must have a basis for thinking that the units making up the sample to be tested (or the representative sample) are like the untested units of the children's product with respect to compliance to the applicable children's product safety rule. The final rule maintains this definition, which places responsibility on the manufacturer to choose representative samples in a manner that provides a basis for inferring the compliance of the untested product units.

(Comment 3)—A commenter opines that the proposed rule defines “representative” in a rigid way, and thereby re-creates the effect of “random” as in the original wording of the CPSIA. The commenter asserts that the word “representative” does not require any clarification. The commenter suggests that the common meaning of the word “representative” is that the sample stands for the body of product being tested, and further suggests the following as an alternate definition of “representative”:

(Response 3)—No change to the final rule was made based on this comment. The commenter's proposed definition characterizes “representative” samples as those units that are “not known to be different” from the untested units, as opposed to the Commission's characterization, which is that “representative” samples are those units that are “known to be like” the untested samples on the basis provided by the manufacturer. The Commission considered the commenter's alternative definition but regards this definition of “representative sampling” as an attempt to prove a negative, which cannot be done. A “not known to be different” form of representative sampling does not provide a basis for knowing that the samples tested are similar to the untested units of the product. Without that basis, the testing results can indicate only the compliance of the samples actually tested and not the compliance of the untested product units. Without a means to infer compliance of the untested product units, the testing of “not known to be different” representative samples cannot ensure continued compliance, as required by section 14(i)(2)(B)(ii) of the CPSA.

To ensure continued compliance, the Commission's approach is to require a manufacturer to have knowledge of the similarity of the tested samples to the untested units because the absence of knowledge of their differences is not sufficient to ensure continued compliance. Knowledge of the similarity of tested samples may come from prior testing, the manufacturer's knowledge of its product, production processes, quality control procedures, a production testing program, the materials used in the product, and/or the design of the product. So long as the manufacturer has a rational basis for inferring the similarity of the untested product to the tested samples, and documents this rationale, the manufacturer has met the requirements in the final rule.

(Comment 4)—A commenter suggests that the CPSC define “representative samples” based on what they are not. The commenter states that as long as a sample is not a “golden sample,” meaning that it was not manufactured to be different in any way from the rest of the produced samples, then it should be considered to be representative.

The commenter reasons that noncompliant outliers may exist even in the most homogenous of manufacturing practices, and manufacturers may not be able to prove why a single test result was an outlier. However, the commenter adds that it is much easier to prove that the manufacturer performed the due diligence necessary to ensure they did everything possible to prevent the outlier from being created.

The commenter opines that this clarification would in no way change the CPSC's definition of a “representative sample.” According to the commenter, all manufacturers would still have to be able to prove that a test result is representative of their entire product line. Moreover, adds the commenter, such a clarification will give manufacturers the assurance needed to rely on their individual remedial action plans if a failure occurs due to an outlier that does not represent the entire product line. The commenter predicts that this interpretation will protect manufacturers from having to destroy many more products that may still be compliant, should testing reveal a noncompliance.

(Response 4)—The Commission considered this alternative definition but regards this definition of “representative sampling” as an attempt to prove a negative, which cannot be done. A “not a golden sample” form of representative sampling does not provide a basis for knowing that the samples tested are similar to the untested units of the product. Without that basis, the testing results can indicate the compliance only of the samples actually tested and not the compliance of the untested product units. Without a means to infer compliance of the untested product units, the testing of “not a golden sample” representative samples cannot ensure continued compliance, as required by section 14(i)(2)(B)(ii) of the CPSA.

The term “golden sample” would seem to suggest a sample that is: (1) Not known to be similar to the population of units produced, and (2) would have a greater likelihood of passing the required tests. However, the absence of those two traits does not make a sample representative based on the definition in the final rule. For example, if a sample was taken of the first 400 items from a production run of 100,000, the sample selector may have no greater confidence before the test that these items would pass the test than items selected from later in the run or throughout the run. The first 400 items may be representative samples, however, if the manufacturer has a basis for inferring that the units are representative of the remaining 99,600 units. Absent some independent basis for knowing that the remaining 99,600 units are similar to the first 400 units of product from the run, this could be a sampling approach that could fail to be representative.

A single test failure in a number of samples tested does not automatically mean that the production lot from which the samples were selected is not compliant, and therefore, must be reworked or destroyed. A failing test result means that the manufacturer does not have a high degree of assurance that all of the units from the production lot from which the sample was taken are compliant with the applicable children's product safety rule. Further investigation is needed for the manufacturer to determine whether the manufacturer can still have a high degree of assurance that the untested units are compliant. This investigation might include examining the testing procedures, calibrating the test instrumentation, testing additional samples, or other actions.

(Comment 5)—A commenter states that the CPSC interprets the need to “ensure” compliance to mean that no exercise of judgment or good faith is allowed and that regulated companies must always be able to prove compliance. The commenter adds that the proposed rule rules out reliance on “process,” or even the absence of contrary indicators, to support a conclusion that samples are “representative.”

(Response 5)—No changes to the final rule were made based on this comment because the final rule does indeed allow and require manufacturers to exercise judgment and good faith in selecting representative samples. In fact, the entire third party testing regime set forth in 16 CFR parts 1107 and 1109 depends upon the exercise of “due care” by all certifiers. “Due care” is a flexible concept, defined as “the degree of care that a prudent and competent person engaged in the same line of business or endeavor would exercise under similar circumstances. Due care does not permit willful ignorance.” 16 CFR 1107.2 & 1109.4(g).

Because of the multitude of different industries and children's products, the Commission adopted a flexible performance standard in implementing third party testing requirements. Determining what constitutes “a high degree of assurance,” and “the exercise of due care,” requires the exercise of business judgment in all aspects of testing. The Commission stated numerous times throughout the final testing rule that manufacturers are required to know about their products and they must implement a testing program accordingly. Sections 1107.20(b) and (d), 1107.21(b)(2), 1107.21(c)(1), and 1107.23(a) of 16 CFR part 1107, all refer to the manufacturer's knowledge of the product and its fabrication in implementing sampling and testing plans, as well as other manufacturer actions intended to provide a high degree of assurance of compliance to the applicable children's product safety rules.

The final rule requires regulated companies to be able to provide a basis for inferring the compliance of the untested production units from the tested samples. Without such a basis, the testing would serve no purpose other than to demonstrate the compliance of the tested units. However, the final rule does not rule out the use of “process.” In fact, “process” can show that the samples selected for testing are like the untested units. For example, a process that manages the lots or batches of constituent materials of a children's product can be used as a basis for inferring homogeneity of the products with respect to the chemical tests for lead and phthalates. As another example, a process that creates uniformly spaced holes in the crib rails for the uniformly constructed crib slats can be used as a basis for inferring the homogeneity of that portion of the product when conducting the component spacing test of ASTM F1169-10.

Standing alone, the absence of contrary indicators is not sufficient to infer compliance of the untested production units from the tested samples because this could include willful ignorance of the potential differences between the untested units and the tested samples. Such an approach would not likely meet minimum due care requirements.

(Comment 6)—A commenter desires that the CPSC continue to consider random sampling to be a subset of representative sampling. The commenter asserts that including random sampling methods allows the manufacturer the flexibility to select a random sampling procedure that is most appropriate for the manufacturer's product production setting but still allows for the inference about the compliance of the population of product units. The commenter further states that many companies proactively implemented random testing programs when the CPSC first proposed and supported such programs in December 2008, and the commenter wants the CPSC to continue to recognize this as an acceptable means of representative sampling.

(Response 6)—No change to the final rule arises out of this comment because the final rule allows random sampling as a means to ensure representative sampling. The Commission agrees that random samples are a form of representative sampling because the test results of the tested units can be used to infer the compliance of the untested units of the children's product. The preamble to the proposed rule specifically states:

(Comment 7)—One commenter is having difficulty understanding how to select a representative sample for periodic testing. The commenter's products consist of sets of component parts, each produced on a different date. Some of the finished products contain component parts that were manufactured more than a year ago. The commenter adds that their finished products consist of multiple variations of component parts from many production lots, resulting in no more than a few with the same set of component parts.

(Response 7)—The purpose of periodic testing is to ensure compliance with all the applicable children's product safety rules for continued production of a children's product. Previously tested lots or batches of component parts do not require periodic testing. If a lot or batch of component parts was sampled and tested for certification purposes, those test reports remain valid for the remainder of the particular lot or batch. Continued production or importation of newly produced component parts (assuming no material changes) are subject to periodic testing. If a manufacturer or importer conducted certification testing on each new lot or batch of component parts, that testing would constitute, in essence, recertification of the finished product, based on tests of each batch or lot of the components, and therefore, periodic testing requirements might not apply.

Continuing production of the component parts can have representative samples selected for periodic testing purposes. For example, if a component part continues to be produced or imported, and it is included in a children's product, representative samples of the component part could be tested to comply with the periodic testing requirements. Alternatively, representative samples of continued production of the finished product could be selected for periodic testing purposes.

If the source of component parts changes (either a new supplier of a currently used component part or a component part that had not been used before), that would be a material change, necessitating certification testing to the children's product safety rules that could be affected by the material change.

Another method of conducting periodic testing could involve random sampling and testing of the continued production of component parts or of the finished product. Random sampling is an acceptable means of selecting a representative sample.

If varying combinations of component parts can affect the compliance of the finished product, then those combinations of component parts represent a material change that requires certification testing for each combination that is materially different.

(Comment 8)—This comment was received in Docket CPSC-2011-0081. A commenter believes that knowledge from first party testing and/or second party testing can be used to develop sampling plans for third party testing that reduce the overall test burden, while still allowing the compliance of untested products to be inferred from the products tested by the third party conformity assessment body.

(Response 8)—We interpret “first party testing” as testing conducted by the manufacturer and “second party testing” as testing conducted by a retailer to whom a manufacturer sells children's products. We agree with the commenter that the manufacturer's knowledge of a product, the applicable children's product safety rules, and the manufacturing process, combined with first or second party testing, can be used to determine the procedure for selecting representative samples. The combination of the factors listed above can be used to infer the compliance of the untested production units from the samples tested by a third party conformity assessment body.

(Comment 9)—A commenter states that if the manufacturing process of a children's product is “managed properly,” then the first customs clearance article should be regarded as a representative sample.

(Response 9)—We are not sure what the commenter means by “first customs clearance article,” but we will assume, for the purposes of this answer, that it means the first article manufactured outside of the United States that is cleared for entry and consumption by U.S. Customs and Border Patrol. If the article is a finished children's product subject to a children's product safety rule, it must be accompanied by a Children's Product Certificate based on testing by a CPSC-accepted third party conformity assessment body.

If, by “managed properly,” the commenter means that the imported products are homogeneous with respect to compliance, then the first customs clearance article, assuming that it was tested by a CPSC-accepted third party conformity assessment body, can be regarded as a representative sample. Under the final rule, the manufacturer or importer must be able to provide a basis for why it believes its products are homogeneous. A demonstration of homogeneity with respect to compliance would serve as a basis to show that the representative samples chosen for testing are like the untested production units.

For example, if a manufacturer injection molded an item using plastic pellets from the same lot or batch, the manufacturer would be assured that, with respect to the chemical tests, the plastic items were homogeneous. As another example, if a manufacturer produced small balls, and the production process included an automatic test to reject balls small enough to pose a small parts hazard (perhaps by falling through a hole into a reject bin), then the manufacturer would have demonstrated homogeneity with respect to the small balls requirement. Because an imported children's product must comply with all of the applicable children's product safety rules, an importer, wishing to use the first customs clearance article as a representative sample, must also show how that sample is representative for all of the applicable tests, including those for which the finished product is required to assess compliance.

(Comment 10)—This comment was received in Docket CPSC-2011-0081. Two commenters state that the CPSC should clarify that importers are not required to determine “representative sampling” procedures. One commenter recommends that the CPSC look at the definition of “manufacturer” used in the Testing and Labeling Pertaining to Product Certification rulemaking. The commenter notes that 16 CFR 1107.2 defines “manufacturer” as “the parties responsible for certification of a consumer product pursuant to 16 CFR 1110.” According to § 1110.7(a), when products are manufactured outside of the United States, the importer must issue a certificate of conformity. The commenters believe that some could read this to mean that a “representative sampling” procedure must be determined by the importer, even if component part testing is conducted by suppliers. These commenters explain that many testing decisions are made upstream in the supply chain. Now that the CPSC accepts component part testing, these commenters contend that decisions related to testing intervals and sample size are appropriately made by the manufacturer ultimately responsible for production samples to be tested, regardless of the importation method. The commenters argue that while it is important that the finished product certifier exercises due care in their reliance on supplier certifications, this should not mean that the finished product certifier should necessarily dictate its suppliers' sampling procedures or that the importer of record should require duplicative testing.

(Response 10)—If the importer is the party that issues the Children's Product Certificate for a product, it is that importer's responsibility to ensure that periodic testing is performed on the children's products they import that are subject to an applicable children's product safety rule. Under the component part testing rule, 16 CFR part 1109, an importer can rely on test reports or certificates from another party as long as they (the importer) exercise due care.

If an importer relies on certificates for component parts or finished products that are supplied by another party, such as a foreign manufacturer or a supplier, then it is the voluntary certifier of the component part or finished product who is responsible for periodic testing of representative samples for the component parts or finished products they certify, and not the importer. The importer must exercise due care to ensure that applicable testing is completed in an appropriate manner. However, if the importer arranges for periodic testing itself, the importer retains the responsibility for selecting and testing representative samples periodically to ensure continued compliance. Periodic testing, including representative sample selection, may be contracted to another party. If so contracted, the other party, called the “testing party” in the component part testing rule, 16 CFR part 1109 ( e.g., a foreign manufacturer or distributor) must provide the basis that the samples selected for testing are representative.

A manufacturer or importer issuing the Children's Product Certificate must still exercise due care in relying on another party's test reports or certifications.

The Commission reminds the commenter that representative samples are selected for periodic testing, which is testing conducted on continuing production of a previously certified children's product. If each imported lot or batch of a children's product is third party tested and certified, then the periodic testing requirements might not apply. Lots or batches that are tested and certified would not represent continued production, even if the name or model number of the children's product did not change.

(Comment 11)—A commenter suggests that the frequency of testing component parts needs to be considered with respect to the level of control exerted over product safety from other regulations with stricter limits on lead and heavy metals, and with respect to the business relationships they have with their suppliers. For example, the commenter considers it sufficient to test for conformity to ASTM F963, “Standard Consumer Safety Specification for Toy Safety,” and total lead once every 2 years as a consequence of the strict specification on the raw materials used in their component parts.

(Response 11)—If the commenter's phrase “strict specification on the raw materials used in their component parts” means a production testing plan as described in 16 CFR 1107.21(c)(2), then submitting representative samples to a third party conformity assessment body for periodic testing every 2 years is allowable, as long as it provides a high degree of assurance of compliance with all applicable children's product safety rules. Unless the manufacturer implements and documents a production testing plan (or uses an ISO/IEC 17025:2005-accredited first party testing laboratory for testing to ensure continued compliance), the maximum testing interval for periodic tests is one year. These periods are the maximum allowed interval. Periodic testing should be conducted at a frequency which, when combined with the manufacturer's other efforts at assuring continued compliance, gives the manufacturer a high degree of assurance of continued compliance.

(Comment 12)—This comment was received in Docket CPSC-2011-0081. A commenter states that the manufacturer, working together with the factory, should determine representative sampling of products with a substantial number of different components, based on knowledge of the products, the applicable product safety standard, and the manufacturing processes that go into making the products.

(Response 12)—We agree that the above-mentioned factors should be taken into account when selecting a representative sample for periodic testing purposes. The method used for selecting representative samples must be one that provides a basis for inferring the compliance of the untested production units from the test results of the tested samples. The manufacturer or importer of a children's product subject to a children's product safety rule retains the responsibility to ensure that periodic tests are conducted on representative samples. Representative sample selection and testing may be contracted to another party. If so contracted, the other party ( e.g., a foreign manufacturer or distributor) must provide the basis for inferring the compliance of the untested production units based on testing of the selected representative samples. The manufacturer or importer issuing the Children's Product Certificate must still exercise due care in relying on another party's test reports or certifications.

(Comment 13)—A commenter who manufactures multiple products from a set of common component parts states that the proposal for testing representative samples has an advantage for this product type. The representative sample can be assembled from common components across the product lines and each component tested according to the relevant safety concerns under the CPSIA.

(Response 13)—This practice is acceptable under the final rule for tests that do not require the finished product for testing. For example, determining compliance to the use and abuse testing of toys described in §§ 1500.50, 1500.51, 1500.52, and 1500.53 on representative samples of common component parts is likely to be unacceptable to determine compliance of a finished product to that standard. For the use and abuse tests, a finished product is necessary to conduct the tests.

However, component part testing of representative samples for compliance to all children's product safety rules that do not require the finished product to assess compliance (such as the chemical tests) can be conducted. The passing test results for those component parts may be used to support children's product certification for finished products employing those component parts.

(Comment 14)—A commenter recommends that 16 CFR 1107.21(c)(1) be amended to include explicit language allowing the use of component part testing for periodic testing purposes. The commenter states that specific regulatory language needs to be inserted into the text, or the commenter's customers may not include component part testing in their contractual relationships with the commenter.

(Response 14)—Section 16 CFR 1107.21(a) states: “Component part testing pursuant to 16 CFR part 1109 may be used to support the periodic testing requirements of this section.” Because the use of component part testing is allowed explicitly in § 1107.21(a), repetition of this in § 1107.21(c)(1) is unnecessary.

(Comment 15)—The following comments on using component parts as representative samples were received in Docket CPSC-2011-0081. One commenter suggests that if a product can be proven to be composed of the same material throughout the end product, then a component could be submitted as a representative sample. The commenter adds that traceability would be important as there are ways that raw materials could be contaminated in the assembly.

A second commenter provides an example of a representative sample with sampling from a construction set of 50 different physical component configurations injection molded with four different colors of polyvinyl chloride resin. The commenter states that a sample could be considered representative as long as all four colors of material were sampled and compliance with the lead substrate or phthalate limits could be established.

A third commenter opines that as long as representative materials or components used in finished production can be sampled, such a process should be maintained as suitable for determining compliance with the lead-in-paint, lead substrate, and phthalate limits for toys and other child care articles. The commenter asserts that Congress clearly recognized the advantage of permissive use of “representative sampling” for the purpose of certifying compliance for like materials and components to these requirements.

(Response 15)—The commenters are describing forms of component part testing used to meet the requirements of periodic testing. These practices are allowed by 16 CFR part 1109. For the chemical content tests, component part testing can be used for periodic test purposes. If the raw materials are tested for lead (and phthalates, if appropriate), then any products made from those raw materials can use the raw material test reports to support the products' Children's Product Certificates. Component part testing is not allowed for tests that require a finished product, such as use and abuse testing of toys described in §§ 1500.50, 1500.51, 1500.52, and 1500.53.

(Comment 16)—This comment was received in Docket CPSC-2011-0081. One commenter states that changing the “random” sampling requirement to “representative” sampling will reduce the testing burden because, for some manufacturers, particularly suppliers of raw materials or components, or manufacturers of simple products, substantially similar products may be representative of the whole body of product to be certified.

(Response 16)—The Commission agrees that changing “random” sampling to “representative” sampling has the potential to reduce the testing burden for manufacturers because more techniques for sample selection are available that can leverage the manufacturer's knowledge of the product and its production processes. Component part testing of raw materials for periodic testing purposes is one means by which a representative sample can be selected. For example, if the same lots or batches of raw materials were used to create several children's products, the results of the chemical tests for one of the products could be used to support the certification requirements of the other products.

(Comment 17)—A commenter states that implementation of the new rules will impose a significant compliance cost on his company. The commenter asserts that the additional costs will not result in increased safety of his company's products and states that “they were already safe.” The commenter's additional compliance cost concerns pertain to rules promulgated since the CPSIA, in particular, 16 CFR part 1107, on testing and labeling pertaining to children's product certification, and not specifically to the proposed rule regarding the use of representative samples for periodic testing.

(Response 17)—No change to the final rule was made based on this comment. Congress provided the CPSC with a third party testing regime to improve the safety of children's products. The final rule implements part of this testing regime. The Commission acknowledges that the cost of the testing required by 16 CFR part 1107 can be significant for some companies. The Commission also is considering other means to reduce third party testing burdens pursuant to section 14(i)(3) of the CPSA, which requires the Commission to seek and consider comments on opportunities to reduce third party testing burdens consistent with assuring compliance.

(Comment 18)—A commenter states that the CPSC's rules for testing children's products are too complicated and costly, and that compliance with the rules is practically impossible. The commenter fears that “[t]he power of the agency to use violations of its rules to levy excessive fines and even attack via injunction ensures that it can dictate any outcome it wants.”

(Response 18)—This rulemaking is limited to the use of representative samples for periodic testing of children's products covered by an applicable children's product safety rule. The final rule is intended to aid industry and the regulated community in understanding what is expected for the periodic testing of children's products.

(Comment 19)—A commenter opines that the recordkeeping requirements of the proposed rule are excessive, uneconomical, and unreasonable. The commenter asserts: “There is absolutely no safety benefit to this recordkeeping, nor will the records maintain (sic) help the agency figure out if there is a safety issue with the affected product.”

(Response 19)—The Commission disagrees with the assertion that no safety benefit comes from recordkeeping. Because failure in the certification system of children's products could occur in many ways, recordkeeping can provide data to help identify the source of the failure. A safety benefit of the recordkeeping requirement is that, if noncompliant products are found in the marketplace, information is readily available that might help the manufacturer and the CPSC determine how such noncompliance occurred and its extent. Requiring manufacturers to provide a rationale for why their samples were chosen for periodic testing may help determine whether that rationale could have been a contributing factor in the incidence of noncompliant children's products being introduced into commerce.

(Comment 20)—A commenter suggests that the Commission prove that:

(Response 20)—Section 2(a)(1) of Public Law 112-28 amended section 14(i)(2)(B)(ii) of the CPSA to state that the Commission shall, by regulation, establish protocols and standards “for the testing of representative samples to ensure continued compliance.” Because the text of the CPSA in this section explicitly calls for regulations to establish standards, we interpret that phrase to include establishing standards for representative samples.

With regard to the commenter's suggestion regarding the relationship between recordkeeping and “keeping the citizenry safe,” the safety benefits of the recordkeeping requirement are described in the response to Comment 19 above. The recordkeeping requirements are intended to help prevent children's products from creating an unreasonable risk of death or injury for consumers.

By enacting section 14(i)(2)(B)(ii) of the CPSA, Congress determined that establishing protocols and standards for periodic testing of representative samples of children's products are worthy of resources and they strengthen the safety of children's products.

The Commission has provided an assessment of the impact of the rule on small businesses under the Regulatory Flexibility Act, but it is not required to conduct a cost-benefit analysis.

(Comment 21)—A commenter proposes that they provide a Certificate of Conformity to the CPSC for each finished product distributed to the U.S. market that requires certification under the CPSIA. The commenter wants the CPSC to determine whether the commenter acted with due diligence with respect to product safety. The certificate would include references to component part tests.

(Response 21)—The final rule is limited to the testing of representative samples for periodic testing of children's products. A request for the CPSC to evaluate certificates of conformity regarding due diligence is beyond the scope of this proposal.

(Comment 22)—A commenter recommends that the Commission have a series of public meetings to review the concept of representative samples because of the enormous range of children's products subject to the rule. The commenter predicts that Commission guidance on an industry basis, over the range of products, would materially assist its member companies to comply.

(Response 22)—This rulemaking is limited to the use of representative samples for periodic testing of children's products covered by an applicable children's product safety rule. However, the Commission will consider the request for public meetings or other guidance regarding the implementation of 16 CFR part 1107, as necessary, beyond the efforts taken, to date.

Generally, the Commission's regulations are considered to have little or no potential for affecting the human environment, and environmental assessments and impact statements are not usually required. See 16 CFR 1021.5(a). The final rule sets forth the Commission's regulation for meeting the requirement in section 14(i)(2)(B)(ii) of the CPSA to test “representative samples.” As such, the final rule is not expected to have an adverse impact on the environment. The rule falls within the categorical exclusion in 16 CFR 1021.5(c)(2). Accordingly, no environmental assessment or environmental impact statement is required.

The Regulatory Flexibility Act (RFA), 5 U.S.C. 601-612, generally requires that agencies review proposed rules for their potential economic impact on small entities, including small businesses. The RFA calls for agencies to prepare and make available for public comment, an initial regulatory flexibility analysis describing the impact of the proposed rule on small entities and identifying impact-reducing alternatives. 5 U.S.C. 603. The RFA further requires agencies to consider comments they receive on the initial regulatory flexibility analysis and prepare a final regulatory flexibility analysis describing the impact of the final rule on small entities and identifying alternatives that could reduce that impact. Id. 604. This section summarizes the Commission's final regulatory flexibility analysis for the final rule on representative samples for periodic testing of children's products.

The objective of the final rule is to reduce the risk of injury from consumer products, especially from products intended for children age 12 years and younger. The final rule will accomplish this objective by requiring manufacturers (including private labelers and importers of products manufactured by foreign manufacturers) to select the samples of children's products for periodic testing (which is be required by 16 CFR 1107.21), using a procedure that provides a basis for inferring that if the selected samples comply with the applicable children's product safety rules, then the units not selected will also comply. In order to ensure compliance of all units produced, one must be able to infer the compliance of the untested units of a product from tests performed on the sampled units.

We received several comments regarding the initial regulatory flexibility analysis (IRFA), which we respond to below.

(Comment 23)—One commenter states that the initial regulatory flexibility analysis was a “[s]ham.” The commenter argues that the “regulatory cost analysis is a whitewash, not a true arm's length analysis” and that “no company will be able to keep up with these rules, big or small.” The commenter further states: “[t]he new rules cannot be afforded by any but the biggest companies—and yet, it's the big companies that have caused the most notorious and dangerous recalls of Children's Products.” The commenter opines that it is the small companies that will be impacted most adversely by the new rule. The commenter finally argues: “[h]aving devoted pages to toting up how many companies would be affected by the rule and meaningless and inaccurate data on revenues of those companies, the authors then punt on the impact of the law.”

(Response 23)—The Commission disagrees with the assertion that the IRFA for the proposed rule, which would establish requirements for the selection of representative samples, is a sham. As the commenter noted, the IRFA described the number and types of small entities that could be impacted by the proposed rule, the requirements that the rule would impose on small entities, and the types of costs small businesses might incur in meeting the requirements. However, the proposed rule did not specify the procedure that firms must use for selecting representative samples: It only required firms to use a procedure that would provide a basis for inferring compliance about the population of products manufactured during that period. Because the Commission did not know what procedures firms would use to meet the requirements of the proposed rule, or know to what extent the procedures used would differ from the procedures that firms would have used to select samples for periodic testing in the absence of the proposed rule, we were not able to quantify further the costs that the rule would have on small businesses. The IRFA specifically requested comments on this issue.

The only revenue data that was included in the IRFA was the average revenue reported by the U.S. Bureau of the Census for the very small, nonemployer businesses that could be impacted by the proposed rule. It is not known to what the commenter is referring when the commenter states that the IRFA contained meaningless and inaccurate data on the revenues of the affected companies. We agree that the proposed rule could have a disproportionate impact on small businesses. However, the commenter seems to be discussing the impacts of the general rule on testing and labeling pertaining to product certification, which was published in the Federal Register on November 8, 2011. The current rulemaking pertains only to the selection of samples for periodic testing and not to the requirements for testing and certification, in general.

(Comment 24)—One commenter notes that two industries were omitted from the list of industries that could be impacted by the proposed rule in the IRFA. The two omitted industries were “screen printing” (NAICS code 323113) and “digital printing” (NAICS code 323115).

(Response 24)—We agree that some manufacturers in the two industries referred to by the commenter could be impacted by the final rule. These industries have been added to the relevant table in the final regulatory flexibility analysis. Additionally, the tables have been updated to reflect the most current available data.

(Comment 25)—One commenter states that the rule will have a tremendous negative economic impact on a substantial number of small entities, and that generally, when agencies request information regarding economic impact on small entities, cost and time estimates are provided. The commenter “believe[s] that these costs will outweigh the paperwork and necessity of testing products that are well within the limits based on component part testing.” The commenter further provides: “The Commission needs to consider alternative testing strategies that allow the small business to incorporate and use current testing protocols that meet the same end goal: Ensuring that all products meet both the lead and phthalate content limits, as applicable.”

(Response 25)—We agree that the final rule could have a negative economic impact on some small entities. The IRFA described the requirements of the proposed rule and the types of costs that firms subject to the rule might incur. However, because the proposed rule did not specify the procedure that firms must use for selecting representative samples, and because we did not know what procedures firms would use to meet the requirements of the proposed rule or to what extent the procedures used would differ from the procedures that firms would have used to select samples for periodic testing in the absence of the proposed rule, we were not able to quantify further the costs that the rule would have on small businesses. The notice of proposed rulemaking also contained an additional discussion of the potential costs associated with the recordkeeping requirements of the proposed rule.

Although alternatives for reducing the costs associated with third party testing are not being addressed in this rulemaking, the Commission is examining alternatives for further reducing the costs associated with third party testing. Any alternatives that are identified may be addressed in future rulemakings, as needed.

By regulation (16 CFR part 1110), the Commission has determined that the domestic manufacturer or importer is responsible for ensuring that a consumer product is properly tested, and, based on the testing results, certifying that it conforms to all applicable consumer product safety rules. Therefore, it is the domestic manufacturer or importer who will be responsible for ensuring that representative samples of children's products that are subject to one or more children's product safety rules are tested to ensure continued compliance. The definition of a children's product is broad and includes bicycles, furniture, apparel, jewelry, televisions, electronic games, toys, and so on, if designed or intended primarily for a child 12 years of age or younger. Virtually all children's products are subject to one or more children's product safety rules. A full list of the children's product safety rules for which third party testing and certification will be required is provided in Table 1.

The number of firms that could be impacted was estimated by reviewing every industry in the North American Industrial Classification System (NAICS) and selecting industries with firms that could manufacture or sell any children's product that could be covered by a consumer product safety rule. Firms are classified in the NAICS category that describes their primary activity. Therefore, firms that might manufacture or import consumer products covered by a safety rule as a secondary or tertiary activity may not have been counted. There is no separate NAICS category for importers. Firms that import products might be classified as manufacturers, wholesalers, or retailers.

According to the criteria established by the U.S. Small Business Administration (SBA), manufacturers are generally considered to be small entities if they have fewer than 500 employees. Table 2 shows the number of manufacturing firms by the NAICS categories that cover most children's products subject to a children's product safety rule. Although there are more than 26,000 manufacturers that would be considered small in these categories, not all of these firms are engaged in manufacturing children's products subject to a children's product safety rule. It would be expected that most of the firms engaged in Doll, Toy, and Game manufacturing produce some products that are intended for children age 12 and younger. On the other hand, the category Surgical Appliance and Supplies Manufacturing includes crash helmets, but most of the other products in this category are not under the CPSC's jurisdiction.

In addition to the manufacturers in Table 2, there were 25,184 nonemployer businesses classified in NAICS 315 (Apparel Manufacturing), 27,645 classified in NAICS 3231 (Printing and Related Support Activities), and 61,180 classified in NAICS 3399 (Other Miscellaneous Manufacturers) in 2008. Nonemployer businesses are generally very small businesses with no employees. They are generally sole proprietorships and may or may not be the owner's principal source of income. The average receipts for the nonemployer businesses classified in apparel manufacturing were about $31,000; for those classified in printing and related support activities, the average revenue was $49,424; and the average receipts for the nonemployer businesses classified other miscellaneous manufacturers were about $41,000. 2 There is no information regarding the number of nonemployer businesses that actually manufacture children's products.

Wholesalers would be impacted by the final rule if they import any children's product that is subject to a children's product safety rule. Wholesalers who obtain their products strictly from domestic manufacturers or from other wholesalers would not be impacted by the final rule because the manufacturer or importer would be responsible for certifying the products. Table 3 shows the number of wholesalers by NAICS code that would cover most children's products that are subject to a children's product safety rule. According to the SBA criteria, wholesalers are generally considered to be small entities if they have fewer than 100 employees. Although there are more than 78,000 wholesalers that would be considered small in these categories, not all of these firms are engaged in importing children's products that are subject to a children's product safety rule. A significant proportion of the firms classified as Toy and Hobby Goods and Supplies Merchant Wholesalers probably import at least some children's products. However, the only firms classified as Motor Vehicle and Motor Vehicle Parts and Suppliers that would be impacted by the final rule are those that import all-terrain vehicles that are intended for children 12 year old or younger.

In addition to the wholesalers tabulated in Table 3, the U.S. Census Bureau estimated that there were 206,072 nonemployer businesses classified in NAICS categories that could include wholesalers of children's products. As noted above, nonemployer businesses are generally very small sole proprietorships. The average receipts for the nonemployer business wholesalers were about $86,000. 3 An unknown number of nonemployer wholesalers could import children's products.

Retailers who obtain all of their products from domestic manufacturers or wholesalers will not be directly impacted by the final rule because the manufacturers or wholesalers would be responsible for the testing and certification of the children's products. However, there are some retailers who manufacture or directly import some products, and therefore, will be responsible for ensuring that these products are properly tested and certified. The number of such retailers is not known. Table 4 shows the number of retailers by NAICS code that would cover most children's products. According to SBA size standards, retailers are generally considered to be small entities if their annual sales are less than $7 million to $30 million, depending on the specific NAICS category. Because of the way in which the data were reported by the Bureau of the Census, the estimates of the number of small firms in each category in Table 4 are based on similar, but different criteria. Although there are more than 100,000 firms that would be considered to be small businesses in these categories, it is not known how many of these firms are engaged in importing or manufacturing children's products. Many of these firms probably obtain all of their products from domestic wholesalers or manufacturers and would not be directly impacted by the final rule.

In addition to the retailers tabulated in Table 4, the U.S. Census Bureau estimated that there were 324,918 nonemployer businesses classified in NAICS categories that could include retailers of children's products. As noted above, nonemployer businesses are generally very small sole proprietorships. The average receipts for the nonemployer business retailers were about $40,000. 4 An unknown number of nonemployer retailers could import children's products.

The final rule requires that children's product manufacturers select samples required for third party periodic testing (required by 16 CFR 1107.21) using a procedure that provides a basis for inferring compliance about the population of untested products produced during the applicable periodic testing interval. The final rule requires further that the number of samples selected must be sufficient to ensure continuing compliance with all of the applicable children's product safety rules.

In order to be able to infer the compliance of the untested products, the samples selected must be representative of the untested or unselected units in the population of products produced during the periodic testing interval. In other words, children's product manufacturers must have a basis for believing that if the samples selected for periodic testing show compliance with the applicable children's product safety rules, then one can infer the compliance of the untested units in the population. In many cases, a manufacturer's knowledge of the manufacturing processes or materials used may provide such information. For example, if the manufacturer knows that a product or component is manufactured using the same grade of material as all of the other units, and the production processes are controlled such that all of the dimensions are the same as all other units, then that product or component could be considered representative of all other units produced during the interval. Information that can be used to establish that a sample is representative can come from a variety of sources, including inspection of, or tests on, incoming materials or components and inspection, tests, and process-control data generated during production.

Other methods of selecting representative samples include various probability-based sampling methods. These methods include simple random sampling, cluster sampling, systematic sampling, stratified sampling, and multistage sampling. Probability-based sampling methods allow statistical inferences to be made about the population of the products, based upon results of tests on the selected samples.

The final rule requires that manufacturers document the procedures used to select the product samples for periodic testing and note the basis for their belief that the samples are representative of the untested product produced during the periodic testing interval. The records must be maintained for five years. The records can be maintained electronically or in hardcopy. The manufacturer must make the records available for inspection by the CPSC, upon request. The records may be maintained in languages other than English, if they can be provided immediately to the CPSC, upon request, and as long as the manufacturer can translate the records into English accurately within 48 hours of a request to do so by the CPSC, or any longer period negotiated with CPSC staff.

There will be some costs associated with developing and implementing sampling procedures that will result in the selection of representative samples. Some knowledge of subjects, such as statistics and quality control techniques, may be necessary to develop the procedure. Some manufacturers may have these skills in-house; others may need to hire consultants with these skills. There also may be some ongoing costs associated with selecting the representative samples once the procedures have been developed. There will also be some costs associated with documenting the procedure and maintaining the records that are required by the final rule. However, because there are potentially a wide range of methods for selecting representative samples, and we do not know which methods will be used by firms, the magnitude of the costs cannot be estimated.

The final rule establishes requirements that must be met in selecting the samples of children's products for the periodic testing required by 16 CFR 1107.21. It does not duplicate, overlap, or conflict with other federal rules.

The final rule establishes a performance standard rather than mandates a specific procedure for selecting samples for periodic testing that all manufacturers must use. Manufacturers may use any procedure they choose for selecting samples for periodic testing as long as the procedure provides a basis for inferring compliance about the entire population of products manufactured during the applicable interval. Manufacturers are also free to change the procedures that they use to select samples, if they determine that a procedure different from the one they are using would be less costly, provided that the new procedure provides a basis for inferring compliance about the population of untested products produced during the applicable period.

As discussed in the initial regulatory flexibility analysis, we considered less stringent alternatives for selecting representative samples, such as allowing manufacturers to select the samples using any procedure, provided that the procedure used would not purposively lead to the selection of samples that the manufacturer knows are more likely to comply with a standard or requirement than other samples (often referred to as “golden samples”). We reexamined these alternatives during review of the public comments submitted in response to the notice of proposed rulemaking. Such alternatives were not adopted because we generally believe that it is necessary for manufacturers to have a positive basis for believing that the samples selected for periodic testing are, in fact, representative of the entire population of units produced during the applicable periodic testing interval. Using a “not a golden sample” form of representative sampling would require manufacturers to prove a negative, which cannot be implemented or enforced. The approach does not provide a basis for knowing that the samples tested are similar to the untested units of the product. Without that basis, the testing results can indicate the compliance only of the samples actually tested and not the compliance of the untested product units. Without a means to infer compliance of the untested product units, the testing of “not a golden sample” representative samples cannot ensure continued compliance, as required by section 14(i)(2)(B)(ii) of the CPSA.

The final rule contains information collection requirements that are subject to public comment and review by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). In a November 8, 2011, Federal Register notice regarding the proposed rule (76 FR 69586, 69592-93), we described the information collection and the annual reporting burden. Our estimate includes the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing each collection of information.

We invited comment on: (1) Whether the collection of information is necessary for the proper performance of the CPSC's functions, including whether the information will have practical utility; (2) the accuracy of the CPSC's estimate of the burden of the proposed collection of information, including the validity of the method and assumptions used; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques, when appropriate, and other forms of information technology.

We received one comment on the burden estimates contained in the proposed rule.

(Comment 26)—One commenter agrees with our estimate that it might take 4 hours per product or group of products to prepare the records required by the rule to document the procedures used to select representative samples and the basis for inferring the compliance of the untested products manufactured during the period. However, the commenter states that the estimated hourly cost of $50.08 was probably low and that a more accurate estimate was $75 per hour, given the likely involvement of lawyers and other professionals. The commenter also questions the assumption that manufacturers would use the same sampling plan for similar or closely related products or product lines. The commenter states that they thought it would be much more likely that a plan would be developed and documented for each item. The commenter also states that another 4 hours would be required for each test sample selected.

(Response 26)—The hourly cost estimate of $50.08 in the proposed rule was based upon the average hourly cost for total employee compensation for all management, professional, and related workers in private industry, as reported by the Bureau of Labor Statistics as part of the “Employer Costs for Employee Compensation data series. Therefore, the cost estimate we used assumed appropriately that the work would be done by management and professional employees. Of course, the costs for any particular businesses may be higher or lower than the average. We do not believe that the commenter provided sufficient information to change our approach for estimating the hourly cost of producing the records for documenting the selection of representative samples. However, the hourly cost estimate is being updated to reflect the most recent estimate reported by the Bureau of Labor Statistics, which is $50.41, as of September 2011.

We agree with the commenter that some manufacturers may determine that they need to develop a separate sampling procedure for each children's product that they manufacture. The discussion in the notice of proposed rulemaking allowed for this possibility when it stated that in some cases, “a manufacturer might have only one product in a particular product line.” 76 FR 69592. However, we believe that other manufacturers may have multiple products in their product lines and determine that the same sampling procedure may be used for groups of similar or closely related products or product lines. As stated in the notice of proposed rulemaking, we do “not have information on the number of closely related products or product lines that manufacturers offer or the average number of individual models within each set of closely related products or product lines.” Id. Therefore, a range of possible values was used in estimating the recordkeeping burden, and the notice of proposed rulemaking invited comments from manufacturers and others to gain better insight on the potential recordkeeping burden of the proposed rule. This comment was the only one that addressed this issue. However, it did not provide sufficient information to change the assumptions we used in the notice of proposed rulemaking for estimating the recordkeeping burden.

The commenter's statement that an additional 4 hours would be required for each test sample selected appears to be a reference to the amount of time associated with the other recordkeeping requirements of the final rule on testing and labeling pertaining to product certification (16 CFR part 1107), which was published in the Federal Register on November 8, 2011. Those recordkeeping costs were discussed in the Federal Register notice associated with that rulemaking (76 FR 69537-40) and are not related to the current final rule on selecting representative samples.

The information collection requirement associated with the final rule is summarized below.

Title: Amendment to Regulation on Testing and Labeling Pertaining to Product Certification Regarding Representative Samples for Periodic Testing of Children's Products

Description of Respondents: Manufacturers of children's products.

Description: The final rule would require records that describe how the samples for periodic testing are selected, the number of samples that will be selected, and an explanation of why the procedure described will result in the selection of representative samples, such that one can infer that the untested units produced during the periodic testing interval comply with the applicable children's product safety rules if the samples selected comply.

We estimate the burden of this collection of information as follows: Although it might take a manufacturer several hours, perhaps several days to analyze its products and manufacturing processes to determine its options for selecting representative samples (and some might need to hire consultants for this purpose), the actual documentation of the procedure and basis for inferring compliance will probably take less time.

On the assumption that because this document is required by regulation, manufacturers will make sure that the document is reviewed and edited properly, it could take an average of 4 hours to prepare this document, once the procedure that will be used is decided and the number of samples has been determined. Developing the sampling procedure and documenting it are managerial or professional functions. According to the Bureau of Labor Statistics, as of September 2011, total compensation for management, professional, and related occupations for all workers in private industry was $50.41 an hour. Therefore, the cost of creating the record documenting a procedure for selecting representative samples could be estimated to be about $202 ($50.41 × 4 hours). 5

In developing the estimates of the recordkeeping burden associated with the testing and labeling pertaining to the certification of a children's products rule, we estimated that there were about 1.6 million children's products. However, manufacturers probably will not need to develop and document a separate sampling procedure for each product. It might be more reasonable to believe that manufacturers will be able to use the same sampling plan for similar or closely related products or product lines. Therefore, manufacturers may need to develop and document separate sampling procedures for each set of closely related children's products or children's product lines rather than each individual product. For example, a manufacturer of die-cast toy cars might offer 50 different models, but if each one is manufactured using the same manufacturing processes and the same materials, one sampling plan for all die-cast cars by this manufacturer might be sufficient. We do not have information on the number of closely related products or product lines that manufacturers offer or the average number of individual models within each set of closely related products or product lines. In some cases, a manufacturer might have only one product in a particular product line. Some large manufacturers may offer several hundred models or styles within some product lines.

A starting point to estimate the recordkeeping burden of the final rule is to assume that each product line averages 10 to 50 individual product models or styles. If each product line averages 50 individual models or styles, then a total of 32,000 individual sampling plans (1.6 million children's products ÷ 50 models or styles) would need to be developed and documented. This would require 128,000 hours (32,000 plans × 4 hours per plan) at a total cost of approximately $6.5 million (128,000 hours × $50.41 per hour). If each product line averages 10 individual models or styles, then a total of 160,000 different sampling plans (1.6 million children's products ÷ 10 models or styles) would need to be documented. This would require 640,000 hours (160,000 plans × 4 hours per plan), at a total cost of approximately $32.3 million (640,000 hours × $50.41 per hour).

Once a sampling plan is developed and documented, manufacturers will probably not incur the full cost of documenting their sampling plans in subsequent years because the same plan and documentation should be valid. However, each year, it is expected that manufacturers will retire some product lines and introduce new ones. Moreover, some manufacturers will leave the market, and other manufacturers will enter the market. Therefore, there will be some ongoing costs associated with documenting sampling plans.

We do not have data on the number of new product lines introduced annually, whether from existing manufacturers or from new manufacturers entering a market. For purposes of this analysis, we will assume that about 20 percent of the children's product lines are new each year, either because an existing manufacturer has changed an existing product line to the extent that a new sampling plan is required, introduced a new product line, or because a new manufacturer has entered the market. If this is the case, then the ongoing recordkeeping costs associated with the final rule would be 25,600 hours (128,000 hours × 0.2) to 128,000 hours (640,000 hours × 0.2) annually or approximately $1.3 million (25,600 hours × $50.41 per hour) to approximately $6.5 million (128,000 hours × $50.41 per hour) annually.

Another potential ongoing recordkeeping cost might result if manufacturers make adjustments or revisions to their sampling plans or procedures for their existing product lines. This might occur if manufacturers find that their initial procedures are difficult to implement or if they come up with more efficient methods of selecting representative samples. We do not have any information that could be used to estimate how often manufacturers will revise these plans. For purposes of this analysis, we will assume that this, too, would amount to about 20 percent of the burden estimated for the initial year, or approximately $1.3 million to $6.5 million annually.

Executive Order 12988 (February 5, 1996), requires agencies to state in clear language the preemptive effect, if any, of new regulations. The final rule would be issued under the authority of the CPSA and the CPSIA. The CPSA provision on preemption appears at section 26 of the CPSA. The CPSIA provision on preemption appears at section 231 of the CPSIA. The preemptive effect of this rule would be determined in an appropriate proceeding by a court of competent jurisdiction.

The Administrative Procedure Act (APA) generally requires that the effective date of a rule be at least 30 days after publication of a final rule. 5 U.S.C. 553(d). The Commission stated in the proposed rule, at 76 FR 69593, that a final rule would become effective on the same date as the rule on “Testing and Labeling Pertaining to Certification” because §§ 1107.21(f) and 1107.26(a)(4) on representative sampling are an amendment to that rule. Accordingly, the effective date of the final rule is February 8, 2013, and it applies to products manufactured after this date, to coincide with the effective date of 16 CFR part 1107.

Accordingly, the Commission amends 16 CFR part 1107 as follows:

I. Background A. The National Housing Act Prohibition on Certain Sources of Cash Investment

To qualify a mortgage for FHA mortgage insurance, section 203(b)(9)(A) of the National Housing Act (12 U.S.C. 1709(b)(9)) requires the homebuyer to pay “in cash or equivalent on account of the property an amount equal to not less than 3.5 percent of the appraised value of the property.” Some homebuyers obtain this minimum amount from sources other than their own earnings or savings; for example, a relative may give or loan them this money or some part of it. However, section 203(b)(9)(C) of the National Housing Act provides that no part of this required minimum investment may consist of funds provided by the seller of the property or any other person or entity who benefits financially from the sale of the property, or any person who is reimbursed by any such person or entity.

Governments—Federal, State, and local—and their agencies and instrumentalities have provided assistance toward the minimum cash investment as part of homeownership programs from various public funds, including appropriated funds, operating tax revenues, taxable and tax-exempt general obligation bonds, and surplus revenues (for example, excess reserves). Federal homeownership assistance programs that have a cash investment component include HUD's Neighborhood Stabilization Program, Community Development Block Grant (CDBG) program, and HOME Investment Partnerships program, as well as the Department of Veterans Affairs Home Loan Guaranty Service and U.S. Department of Agriculture's Rural Development Housing and Community Facilities program. These Federal homeownership assistance programs have specified public purposes, such as revitalizing communities affected by foreclosures and vacancy, increasing the homeownership rate in particular geographies, making homeownership affordable to underserved populations and in high-cost markets.

For these Federal assistance programs, Congress has authorized funds to be distributed from the Treasury, often through State and local governments or their instrumentalities, for purposes of supporting homeownership programs. At the same time, section 203(b)(9)(C) of the National Housing Act raises the question whether the distribution of these same Federal funds would cause the mortgages originated on the basis of support from such funds not to qualify for FHA insurance. Reading the prohibition in section 203(b)(9)(C) to include other Federal agencies, State and local governments, or their instrumentalities disbursing government funds in accordance with the requirements of government assistance programs would place these governments and instrumentalities in an untenable position of having governmental authority to provide assistance toward the minimum cash investment on the one hand, but being unable to use FHA-insured mortgage financing on the other. To do so would also frustrate the statutory purpose of these programs and of the FHA to encourage and support homeownership. 1

Another key source of homeownership assistance programs, such as assistance with closing costs, or rehabilitation, is provided by State and local governments, primarily through housing finance agencies (HFAs). According to the National Council of State Housing Finance Agencies, HFAs are generally State-chartered authorities established by State governments to help meet the affordable housing needs of State residents. 2 Although HFAs vary widely in characteristics such as their relationship to State government, most are independent entities that operate under the direction of a board of directors appointed by their respective State governors. They administer a wide range of affordable housing and community development programs. 3 Using housing bonds, low-income housing tax credits, HOME program funds, and other Federal and State resources, HFAs have crafted hundreds of housing programs, including homeownership, rental, and all types of special-needs housing. HFAs have provided affordable mortgages to 2.6 million families to buy their first homes through mortgage revenue bond programs. 4

A recent study of HFAs found that 100 percent of the 51 HFAs surveyed said that part of their mission is “to assist low- and moderate-income residents to purchase homes and be successful homeowners.”  5 A majority of those programs—in 2011, 88 percent (45 of 51) of State HFAs—include minimum cash investment as a part of advancing their mission. 6 Federally backed mortgage insurance is also a critical part of the HFAs' strategy. Of HFA loan production in 2011, 86 percent involved FHA, Veterans Administration (VA), or Rural Housing Service loan or loan insurance programs.

Many HFAs administer other State and Federal housing assistance programs such as homeless assistance, CDBG, and State housing trust funds. Local housing finance agencies operate similarly but at the county, city, or other municipal-entity level. In many cases, a local agency may be the local government itself. HFAs provide various services to assist citizens within their jurisdictions in attaining affordable housing options. These services include providing access to affordable mortgage loans for purchasing a home, counseling, money and other resources for closing costs, and assistance for any required investment in the mortgaged property. Such funds come from numerous sources. Program beneficiaries are usually low- and moderate-income individuals and families who have gone through homeownership counseling through which they receive training on money management, use of credit, and home maintenance.

Since its enactment, the National Housing Act (NHA) has required the mortgagor to have a minimum investment in the property being purchased. For many years, the required minimum investment was 3 percent of the cost of acquisition, and is currently 3.5 percent of the home's appraised value. Prior to 2008, the statute and regulations regarding the required investment were silent, with minor exceptions, as to permissible sources of the mortgagor's required investment. However, FHA's single family mortgage credit handbook, Handbook 4155.1, 7 provided administrative guidance to approved mortgagees as to permissible sources of the funds that a homebuyer could use for the required minimum investment. HUD's policy under the handbook provisions was to permit the minimum cash investment to be financed by sources including a family member, the borrower's employer or labor union, a governmental entity, a charitable organization, or a close friend with a clearly defined and documented interest in the borrower. HUD's policies have always expressly prohibited the seller from financing or providing a gift of the required investment.

In the 1990s, several nonprofit entities developed an approach to funding homebuyers' cash investments that circumvented the handbook prohibition. These entities obtained charitable status from the Internal Revenue Service, and then encouraged home sellers to use their services and provided homebuyers with all or part of the required cash investment amount. After the funds were provided by the nonprofit entity to the homebuyer, the seller made a donation to the nonprofit entity of the amount of the assistance plus a fee. The donated funds were directed to subsequent homebuyers for the cash investment on their homes. The nonprofit does not conduct broad-based fundraising but instead relies on sellers and other businesses in real estate for financial support. In effect, sellers and other donors were indirectly funding the homebuyer's required minimum investment by reimbursing the nonprofit entity for each transaction. 8

As the prevalence of channeling funds from sellers through nonprofit entities increased, FHA became concerned that this practice as applied to homebuyers with FHA-insured mortgages could result in FHA insuring riskier loans. In response, FHA published a proposed rule in 1999 to prohibit this source of the minimum cash investment. 9 Under the proposed rule, a gift of the buyer's required minimum cash investment would disqualify the loan from FHA insurance if the entity providing the gift received funds directly or indirectly from the seller of the property. However, the proposed rule expressly included funds provided by a “State or local government agency or instrumentality” in the category of permissible sources of funds that the homebuyer can apply toward the minimum investment requirement. 10 HUD withdrew the rule in January 2001 in light of widespread opposition to the rule as proposed. 11

The direct and indirect financing of homebuyers' minimum cash investment by sellers continued to be a source of concern following the withdrawal of the proposed rule. In 2005, the Government Accountability Office (GAO) published a report on the risks raised by the reimbursement of nonprofit entities by sellers. 12 The GAO findings noted that sales prices were increased commensurately to cover the cost incurred by the seller, and thus resulted in homeowners having less actual equity in the newly acquired home. 13 The GAO report also found that the default and claim rate for homes purchased with charitable gifts where the nonprofit entity was reimbursed by the seller was much higher than in those cases where the homebuyer provided his or her own money for the required investment. 14

Moreover, the IRS found that organizations claiming to be charities were being used to funnel money from sellers to buyers through self-serving, circular-financing arrangements, and that in a typical scheme, there is a direct correlation between the amount of the funds provided to the buyer and the payment received from the seller. 15 On May 4, 2006, the IRS issued Revenue Ruling 2006-27, which determined that organizations that indirectly provide cash investments funded by sellers to homebuyers do not qualify as tax-exempt charities. 16 In the press announcement accompanying the ruling, the IRS stated that the ruling makes clear that organizations operating seller-funded programs are not charities because they do not meet the requirements of section 501(c)(3) of the Internal Revenue Code. 17 The IRS also found that the seller pays the organization only if the sale closes, and the organization usually charges an additional fee for its services. 18

On May 11, 2007, HUD again published a proposed rule that prohibited funds provided by the seller as a source for the minimum cash investment. 19 This provision, entitled “Restrictions on Seller Funding,” proposed to prohibit cash investment amounts that consists, in whole or in part, of funds provided by any of the following parties before, during or after closing of the property sale: “(1) The seller, or any other person or entity that financially benefits from the transaction; or (2) any third party or entity * * * that is reimbursed directly or indirectly by any of the parties listed in clause (1).”  20 Once again, the May 2007 proposed rule expressly exempted funds from “a federal, state, or local government agency or instrumentality” from the category of prohibited sources for funds toward the required minimum investment. 21 HUD published its final rule on October 1, 2007. 22 On the effective date of the rule, a lawsuit challenging the rule was filed against HUD in the U.S. district court for the Eastern District of California, and in February 2008 the court set aside the final rule. 23

The 2005 GAO report, the 2006 IRS Ruling, and the judicial invalidation of HUD's final rule eventually led to congressional action on the issue in 2008. Section 2113 of the Housing and Economic Recovery Act of 2008 (HERA), signed into law on July 30, 2008, amended the NHA with language that is identical in relevant part to the language in HUD's 2007 final rule. Section 2113 of HERA amended section 203(b)(9) of the NHA to provide that mortgages eligible for FHA insurance must “[b]e executed by a mortgagor who shall have paid in cash or its equivalent, on account of the property an amount equal to not less than 3.5 percent of the appraised value of the property or such larger amount as the Secretary may determine.” Section 203(b)(9) was also amended to include a new subparagraph (9)(C), which specifies prohibited sources for a mortgagor's minimum investment. Section 203(b)(9)(C) of the NHA states:

Since HERA's enactment, FHA has not replaced the regulation that was vacated by the district court in February 2008. However, Mortgagee Letter 2008-23 provides notification of the statutory revisions to the cash investment requirements imposed by HERA. 24 Instead of 3 percent of the cost of acquisition, the required investment was changed by HERA to 3.5 percent of the appraised value of the property. Aside from the statement that closing costs ( i.e., the present allowed seller incentive of 6 percent) could not be used to meet the 3.5 percent appraised value minimum investment requirement, the Mortgagee Letter is silent regarding the source of the required cash investment by the mortgagor.

It is HUD's interpretation that section 203(b)(9)(C) of the NHA does not prohibit FHA from insuring mortgages originated as part of the homeownership programs of Federal, State, or local governments or their agencies or instrumentalities when such agencies or instrumentalities also directly provide funds toward the required minimum cash investment. 25 The addition of a statutory provision on prohibited sources of cash investment funds, as part of the amendments to section 203(b)(9) of the NHA enacted in HERA, was intended to preclude the abuse of the program where a seller (or other interested or related party) funded the homebuyer's cash investment after the closing by reimbursing third-party entities and added the cost of this reimbursement to the sales price of the home, thus inflating the price of the home beyond its market value. It is HUD's interpretation that the amended section 203(b)(9) does not exclude as a permissible source of cash investment, funds provided directly by Federal, State, or local governments, or their agencies or instrumentalities as part of their respective homeownership programs.

HUD finds support for this interpretation in the surrounding provisions in HERA and in the legislative history of the amendment to section 203(b)(9). First, HERA itself authorized governmental homeownership programs that include a cash investment component, and interpreting section 203(b)(9)(C) to deny FHA insurance to mortgages resulting from such programs would frustrate their statutory purpose. In section 2301 of HERA, Congress authorized the first increment of funding for the Neighborhood Stabilization Program (NSP). NSP provides funds to low- and moderate-income homebuyers for the cash investment on purchasing lender-foreclosed single family properties when the property will be the buyer's primary residence and is located in an eligible target area. NSP funds are distributed through State and local government agencies and instrumentalities. NSP funds are also used to purchase vacant or distressed properties, which may then be resold by the purchasing agency or instrumentality to low- or moderate-income buyers with funds toward the minimum cash investment. Access to FHA mortgage insurance is often essential to making such programs work. 26 Thus, an interpretation of section 203(b)(9)(C) that precludes governments and their agencies and instrumentalities government agencies from providing funding toward the minimum cash investment for an FHA-insured mortgage would undercut a central purpose of NSP and similar Federal, State, and local government programs. 27

Second, the legislative history of the amendment to section 203(b)(9)(C) also supports HUD's interpretation that it does not exclude State and local government home ownership programs from FHA insurance eligibility. In a statement supporting the amendment to section 203(b)(9)(C), Senator Dodd explained that “this bill eliminates the seller-funded downpayment assistance program.”  28 There is no indication that State and local governments or their agencies or instrumentalities were to be within the scope of the amendment. The Senate Committee Report accompanying a 2007 bill containing statutory language  29 identical to what was eventually enacted in HERA further support this interpretation. The report explained that the “section also prohibits seller-funded downpayment entities from providing any of this required cash investment.”  30 It noted that “[s]ince this legislation was passed by the Committee, HUD has promulgated a regulation that also prohibits these entities from providing downpayment assistance funds.”  31 As discussed above, the 2007 HUD rule to which the Senate Report refers expressly excluded State and local government agencies and instrumentalities from the category prohibited sources for the minimum cash investment. The report's identification of “seller-funded downpayment entities” as the targets of both HUD's proposed rule and of the bill indicates that the provision, which is identical to what was enacted in HERA, does not include State and local governments or their agencies or instrumentalities.

Under section 203(b)(9)(A) of the NHA, the homebuyer's investment in the property must be at least 3.5 percent of its appraised value. So long as the homebuyer makes this minimum required investment from his or her own (or other approved) funds, any person, even one associated with the transaction, may contribute additional funds towards the borrower's costs without violating section 203(b)(9)(C). This interpretive rule only applies to funds that constitute all or part of the 3.5 percent minimum investment requirement.

Accordingly, HUD interprets NHA section 203(b)(9)'s “prohibited sources” provision in subsection (C) as not including funds provided directly by Federal, State, or local governments, or their agencies and instrumentalities in connection with their respective homeownership programs.

This interpretive rule represents HUD's interpretation of section 203(b)(9)(C) and is exempt from the notice and comment requirements of the Administrative Procedure Act. See 5 U.S.C. 553(b)(3)(A). Nevertheless, HUD is interested in receiving feedback from the public on this interpretation, specifically with respect to clarity and scope.

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:

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

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

Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2012-0202 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 February 4, 2013. 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 (excluding any Confidential Business Information (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 the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2012-0202, 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 statute.

• Mail: OPP Docket, Environmental Protection Agency Docket Center (EPA/DC), (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.

Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at http://www.epa.gov/dockets.

In the Federal Register of October 17, 2012 (77 FR 63782) (FRL-9366-2), EPA issued a document pursuant to FFDCA section 408(d)(3), 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide petition (PP 1F7955) by Syngenta Crop Protection, LLC, P.O. Box 18300, Greensboro, NC 27419-8300. The petition requested that 40 CFR 180.559 be amended by lowering the established tolerance for residues of the herbicide clodinafop-propargyl in or on wheat, grain from 0.1 to 0.02 parts per million (ppm). That document referenced a summary of the petition prepared by Syngenta Crop Protection, LLC, the registrant, which is available in the docket, http://www.regulations.gov. Comments were received on the notice of filing. EPA's response to these comments is discussed in Unit IV.C. Finally, EPA is revising the tolerance expression for the reasons explained in Unit IV.D.

Section 408(b)(2)(A)(i) of FFDCA allows EPA to establish a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(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. Section 408(b)(2)(C) of FFDCA 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(b)(2)(D), and the factors specified in FFDCA section 408(b)(2)(D), 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 clodinafop-propargyl including exposure resulting from the tolerance established by this action. EPA's assessment of exposures and risks associated with clodinafop-propargyl follows.

In the Federal Register of June 22, 2000 (65 FR 38765) (FRL-6590-7), EPA published a final rule establishing tolerances for combined residues of the herbicide clodinafop-propargyl and its acid metabolite in or on wheat (forage, grain, hay, and straw) based upon EPA's conclusion that aggregate exposure to clodinafop-propargyl is safe for the general population, including infants and children. Since 2000, there have been no additional tolerance actions for clodinafop-propargyl.

This action decreases the established tolerance for residues of clodinafop-propargyl in or on the commodity wheat, grain from 0.1 to 0.02 ppm, based upon a change to an enforcement method (Method MS 247) with a lower limit of quantitation (LOQ) on wheat grain than the current methods. Since an established tolerance is being reduced, which is expected to have no significant exposure effect, no new dietary exposure assessment, drinking water exposure assessment, or non-dietary exposure assessment was conducted.

Except as supplemented by the information described in this unit, EPA is relying on the safety finding in the 2000 rulemaking and the risk assessment underlying that action in amending the tolerance for wheat grain. Further information regarding the safety finding for the last rulemaking can be found in the Federal Register of June 22, 2000, at http://www.epa.gov/fedrgstr/EPA-PEST/2000/June/Day-22/p15715.htm. Although significant new data have been received since the 2000 rulemaking, as discussed in this unit, these data do not indicate that risk from exposure to clodinafop-propargyl were understated. To the contrary, these new data suggest that EPA's prior risk assessment overstated clodinafop-propargyl risks. Further information about EPA's risk assessment and determination of safety for this action can be found at http://www.regulations.gov in document “Clodinafop-propargyl. Human Health Risk Assessment for Clodinafop-propargyl to Reduce the Established Tolerance on Wheat Grain” in docket ID number EPA-HQ-OPP-2012-0202.

For the 2000 rulemaking, the toxicity database for clodinafop-propargyl was considered incomplete. Acute neurotoxicity, subchronic neurotoxicity, developmental neurotoxicity, and in vitro cytogenetic studies were required. The absence of these studies, along with quantitative and qualitative evidence of increased susceptibility, and evidence of potential endocrine disruption, led EPA to retain an additional safety factor for the protection of infants and children as provided by FFDCA section 408(b)(2)(C) (i.e., 10X for acute risk for females 13+ and chronic risk; 3X for acute risk for infants and children). With the exception of the cytogenetic studies, the required studies have since been submitted and found acceptable. Studies were submitted which removed mutagenicity concerns and thus the cytogenetic studies were no longer required.

In all likelihood, the submission of these data will lead EPA to remove the additional safety factor for the protection of infants and children when it formally revises the clodinafop-propargyl risk assessment. The absence of these data was the primary reason for retaining that additional factor. Currently, there is a data gap for an immunotoxicity study. In 2007 changes to 40 CFR part 158 imposed new data requirements for immunotoxicity testing (OPPTS Guideline 870.7800) for pesticide registration. This study has not been submitted for clodinafop-propargyl. The absence of this study is unlikely to result in retention of an additional safety factor. EPA has only retained an additional safety factor when there is a data gap for immunotoxicity where the database shows clear evidence of immunotoxicity and immunotoxic effects were seen at the LOAEL that defined the point of departure (POD). For clodinafop-propargyl, there is evidence in the current toxicological database that clodinafop-propargyl may perturb immune function but this evidence is not strong and it did not affect the choice of the POD. In the subchronic oral toxicity study in rats, treatment-related effects were observed (37% decrease in thymus weight and increased thymic atrophy). Thymus effects were observed only in males at the highest treatment-dose (71 mg/kg/day), and were fully reversed after a 4-week recovery period. No thymus effects were observed in the chronic toxicity/carcinogenicity study in rats. No other indicators of structural immunotoxicity were observed in the current database. While an immunotoxicity study is required to complete the database, the absence of this study is not expected to alter the aRfD or cRfD for clodinafop-propargyl. Hence, by relying on the 2000 risk assessment and the additional safety factors retained in that assessment, EPA has taken a conservative approach that is likely to overstate the estimated risk of clodinafop-propargyl.

The EPA has determined that the results of the neurotoxicity studies adequately elucidate the hazard but do not affect EPA's derivation of clodinafop-propargyl's acute reference dose (aRfD) or chronic reference dose (cRfD). The NOAELs for adverse effects seen in the neurotoxicity studies are well above the NOAELs in the studies used as PODs. Thus, the PODs used in the risk assessment for the 2000 rulemaking for clodinafop-propargyl, as well as the aRfD and the cRfD derived from those PODs, are protective of all effects, including neurotoxicity, observed in the neurotoxicity studies.

Previously, EPA considered clodinafop-propargyl as likely to be carcinogenic to humans based on increased incidences of prostate tumors in male rats, ovarian adenomas in female rats, liver tumors in male and female mice, and blood vessel tumors in female mice and estimated cancer risk using a linear (non-threshold) approach. Since that time, additional data have been submitted, including a re-evaluation of the proliferative lesions in the rat ovary and prostate as well as mode of action data for mouse liver tumors. In 2006, EPA revised its cancer determination on clodinafop-propargyl concluding that the evidence was no greater than suggestive of carcinogenic potential and thus did not support the finding that clodinafop-propargyl was likely to be carcinogenic to humans. That conclusion was based on the following:

1. Prostate tumors (driven mainly by adenomas) were seen in one sex (male) of one species (rat) at the high dose only.

2. There is no mutagenicity concern for clodinafop-propargyl.

3. The weight-of-evidence supports activation of peroxisome proliferator-activated receptor alpha (PPAR”) as the mode of action for clodinafop-induced hepatocarcinogenesis in mice. While the PPAR mode of action for liver tumors in mice is theoretically plausible in humans, hepatocarcinogenesis by this mode of action is quantitatively implausible and unlikely to take place in humans based on quantitative species differences in PPAR” activation and toxicokinetics.

4. Ovarian tumors in the rat and vascular tumors in the mouse were not considered to be treatment-related in the Second Report of the Cancer Assessment Review Committee.

Given this limited evidence of carcinogenic effects in animals or effects unlikely to be relevant to humans, the use of a linear (non-threshold) approach for assessing cancer risk is no longer appropriate. Instead, EPA has determined that the chronic threshold-based risk assessment (i.e., the cRfD approach) will be protective of any cancer risk.

Based upon the 2000 rulemaking and the other information discussed in this unit, EPA concludes that there is a reasonable certainty that no harm will result to the general population and to infants and children from aggregate exposure to clodinafop residues. EPA relies upon those risk assessments and the findings made in the Federal Register document in support of this action.

An analytical method using high-performance liquid chromatography with tandem mass spectrometry detection (LC/MS/MS), Enviro-Test Laboratories Report No. MS 247 (Method MS 247) was submitted in support of reducing the tolerance for wheat grain.

This LC/MS/MS method has a lower LOQ than the current HPLC-UV methods (REM 138.01 for clodinafop-propargyl and REM 138.10 for clodinafop) for the determination of residues of clodinafop-propargyl (CGA-184927) and its metabolite clodinafop (CGA-193469) in or on wheat commodities. Method MS 247 was adequately validated using fortified samples of wheat grain, forage, and straw.

The current enforcement methods (REM 138.01 for clodinafop-propargyl and REM 138.10 for clodinafop) can serve as confirmatory methods for Method MS 247 on wheat grain since they use a different detection system. Therefore, the LC/MS/MS Method MS 247 is adequate as an enforcement analytical method for determination of residues of clodinafop-propargyl and its metabolite clodinafop in wheat grain at 0.02 ppm (0.01 ppm for each analyte). The methods referenced in this unit may be requested from: Chief, Analytical Chemistry Branch, Environmental Science Center, 701 Mapes Rd., Ft. Meade, MD 20755-5350; telephone number: (410) 305-2905; email address: residuemethods@epa.gov.

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

The Codex has not established MRLs for clodinafop-propargyl in or on any commodities.

EPA received an anonymous comment in response to the Notice of Filing that objected to the proposed tolerance petition. The commenter stated that the objection was to the “Syngenta application to increase [the tolerance] from .01 to .02 ppm”. Because this action is to decrease the tolerance from 0.1 to 0.02 ppm, it is assumed that the commenter misinterpreted the proposed petition and would have no objections otherwise. The commenter made additional comments proposing to eliminate tolerances and pesticides altogether. The Agency understands the commenter's concerns and recognizes that some individuals believe that certain pesticide chemicals should not be permitted in our food. However, the existing legal framework provided by section 408 of the Federal Food, Drug and Cosmetic Act (FFDCA) states that tolerances may be set when persons seeking such tolerances or exemptions have demonstrated that the pesticide meets the safety standard imposed by that statute. When new or amended tolerances are requested for residues of a pesticide in food or feed, the Agency, as is required by section 408 of the FFDCA, estimates the risk of the potential exposure to these residues. The Agency has concluded after this assessment that there is a reasonable certainty that no harm will result from aggregate human exposure to clodinafop-propargyl.

EPA received a second anonymous comment in response to the Notice of Filing which urged that regulations in general be stopped because they are killing small businesses. This comment is considered irrelevant to this action because the safety standard for approving tolerances under section 408 of FFDCA focuses on potential harm to human health and does not permit consideration of effects on any type of businesses.

Finally, the EPA is revising the tolerance expression to:

1. Clarify that, as provided in FFDCA section 408(a)(3), the tolerance covers metabolites and degradates of clodinafop-propargyl not specifically mentioned; and

2. Clarify that compliance with the specified tolerance levels is to be determined by measuring only the specific compounds mentioned in the tolerance expression.

Therefore, the established tolerance for residues of clodinafop-propargyl in or on wheat, grain is reduced from 0.1 to 0.02 ppm.

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

Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance 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 FFDCA section 408(n)(4). 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) (2 U.S.C. 1501 et seq. ).

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) (15 U.S.C. 272 note).

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 action is not a “major rule” as defined by 5 U.S.C. 804(2).

Therefore, 40 CFR chapter I 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:

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

You may access a frequently updated electronic version of EPA's tolerance regulations at 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-2010-0458 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 February 4, 2013. 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 (excluding any Confidential Business Information (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 the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2010-0458, 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 CBI or other information whose disclosure is restricted by statute.

• Mail: OPP Docket, Environmental Protection Agency Docket Center (EPA/DC), (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.

Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at http://www.epa.gov/dockets.

In the Federal Register of June 23, 2010 (75 FR 35801) (FRL-8831-3), EPA issued a notice pursuant to FFDCA section 408(d)(3), 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide petition (PP 0F7722) by E.I. du Pont de Nemours & Company 1007 Market Street, Wilmington, DE 19898, proposed to establish tolerances in 40 CFR part 180 for residues of the fungicide picoxystrobin, in or on the cereal grains crop group (crop group 15) except rice at 0.2 parts per million(ppm); the cereal forage and fodder crop group (crop group 16) except rice at 13.0 ppm; cereal grain aspirated grain fractions at 4.5 ppm; cereal grain oil at 1.5 ppm; the dry legume vegetables crop subgroup (crop group 6, subgroup C) except soybean at 0.1 ppm; the legume vegetable foliage crop group (crop group 7) at 18.0 ppm; soybean seed at 0.05 ppm; soybean forage at 0.8 ppm; soybean hay at 2.5 ppm; soybean aspirated grain fractions at 3.2 ppm; soybean hulls at 10.0 ppm; soybean oil at 0.05 ppm; canola seed at 0.05 ppm; meat and meat byproducts except liver of cattle, goat, hog, horse, and sheep at 0.01 ppm; fat of cattle, goat, hog, horse, and sheep at 0.05 ppm; liver of cattle, goat, hog, horse, and sheep at 0.8 ppm; meat, meat byproducts, fat, and eggs of poultry at 0.01 ppm; milk at 0.01 ppm, and cream, at 0.03 ppm. That notice referenced a summary of the petition prepared by E.I. du Pont de Nemours & Company, the registrant, which is available in the docket, http://www.regulations.gov. There were no comments received in response to the notice of filing.

Based upon review of the data supporting the petition, EPA has revised the proposed tolerance levels for several commodities. The reasons for these changes are explained in Unit IV.C.

Section 408(b)(2)(A)(i) of FFDCA allows EPA to establish a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(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. Section 408(b)(2)(C) of FFDCA 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(b)(2)(D), and the factors specified in FFDCA section 408(b)(2)(D), 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 picoxystrobin, including exposure resulting from the tolerances established by this action. EPA's assessment of exposures and risks associated with picoxystrobin follows.

EPA has evaluated the available toxicity data and considered its validity, completeness, and reliability as well as the relationship of the results of the studies 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 most consistently observed effects of picoxystrobin exposure across species, genders, and treatment durations were decreased body weight, body weight gain and food consumption, and diarrhea. The effects on body weight and food consumption were consistent with the commonly observed findings for compounds which disrupt mitochondria respiration system and the resulting disruption of energy production. Similar to some other strobilurins, picoxystrobin causes intestinal disturbance as indicated by increased incidence of diarrhea or duodenum mucosal thickening. These intestinal effects appeared to be related to the irritating action on the mucus membranes as demonstrated by the severe eye irritation effect seen in the primary eye irritation study on picoxystrobin.

Picoxystrobin caused changes in behavioral effects in both the acute and subchronic neurotoxicity studies with no neuropathological findings. The effects observed with acute exposure were transient (i.e. lasted for a day) and consisted of low arousal and decreased motor activities in males and decreased rearing in females, and, with subchronic exposure, included decreased male forelimb grip and increased female hindlimb splay. In the absence of any neuropathological findings, the behavioral effects were attributed to general malaise (probably related to energy production perturbations) as evidenced by the associated decreased body weight and body weight gain.

In the rat and rabbit developmental toxicity studies, developmental toxicity was expressed as skeletal variations at doses causing maternal toxicity (i.e. diarrhea, decreased body weight, body weight gain, food consumption, and clinical signs of toxicity). In the reproduction study, parental/systemic toxicity manifested as decreased body weight and body weight gain in both the parents and offspring; no reproductive toxicity was seen.

Picoxystrobin induced a treatment-related increase in testicular interstitial cell benign tumors only in the high dose male rats. No tumors were seen in females; no treatment related-increase in any type of tumor incidence was seen in male and female mice at doses that were considered to be adequate for the assessment of carcinogenicity of picoxystrobin. There is no mutagenic concern. Based on these data, EPA has concluded that quantification of cancer risk based on a non-linear approach (i.e., reference dose (RfD) will adequately account for all chronic toxicity, including carcinogenicity, that which could result from exposure to picoxystrobin. Specific information on the studies received and the nature of the adverse effects caused by picoxystrobin as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies can be found at http://www.regulations.gov in document, “Picoxystrobin: Human Health Risk Assessment for Proposed Uses on Canola, Cereal Grains Except Rice, Dried Shelled Peas and Beans, and Soybeans.” at pages 17-22 in docket ID number EPA-HQ-OPP-2010-0458.

Once a pesticide's toxicological profile is determined, EPA identifies toxicological points of departure (POD) and levels of concern to use in evaluating the risk posed by human exposure to the pesticide. For hazards that have a threshold below which there is no appreciable risk, the toxicological POD is used as the basis for derivation of reference values for risk assessment. PODs are developed based on a careful analysis of the doses in each toxicological study to determine the dose at which no adverse effects are observed (the NOAEL) and the lowest dose at which adverse effects of concern are identified (the LOAEL). Uncertainty/safety factors are used in conjunction with the POD to calculate a safe exposure level—generally referred to as a population-adjusted dose (PAD) or a reference dose (RfD)—and a safe margin of exposure (MOE). For non-threshold risks, the Agency assumes that any amount of exposure will lead to some degree of risk. Thus, the Agency estimates risk in terms of the probability of an occurrence of the adverse effect expected in a lifetime. For more information on the general principles EPA uses in risk characterization and a complete description of the risk assessment process, see http://www.epa.gov/pesticides/factsheets/riskassess.htm. A summary of the toxicological endpoints for picoxystrobin used for human risk assessment is shown in Table 1 of this unit.

1. Dietary exposure from food and feed uses. In evaluating dietary exposure to picoxystrobin, EPA considered exposure under the petitioned-for tolerances. EPA assessed dietary exposures from picoxystrobin in food as follows:

i. Acute exposure. Quantitative acute dietary exposure and risk assessments are performed for a food-use pesticide, if a toxicological study has indicated the possibility of an effect of concern occurring as a result of a 1-day or single exposure.

Such effects were identified for picoxystrobin. In estimating acute dietary exposure for the general population, including infants and children, EPA used food consumption information from the U.S. Department of Agriculture (USDA) National Health and Nutrition Examination Survey, What We Eat in America, (NHANES/WWEIA). As to residue levels in food, EPA's assumption of this dietary assessment included total highest field trial total residues (parent and metabolite) for all proposed crops. In addition, 100 percent crop treated (PCT) was assumed. Dietary Exposure Evaluation Model (DEEM) version 7.81 default processing factors were assumed except for where tolerances were established for processed commodities or when processing studies showed no concentration. A separate tolerance was set for wheat bran, wheat germ, barley bran and corn oil. Tolerance levels were used for livestock commodities.

ii. Chronic exposure. In conducting the chronic dietary exposure assessment EPA used the food consumption data from the USDA 1994-1996 and 1998 Continuing Survey of Food Intake by Individuals (CSFII). As to residue levels in food, EPA used total highest average field trial total residues (parent and metabolite) for all proposed crops. In addition, 100 PCT was assumed. DEEM version 7.81 default processing factors were assumed except for where tolerances were established for processed commodities. Tolerance levels were used for livestock commodities.

iii. Cancer. EPA determines whether quantitative cancer exposure and risk assessments are appropriate for a food-use pesticide based on the weight of the evidence from cancer studies and other relevant data. Cancer risk is quantified using a linear or nonlinear approach. If sufficient information on the carcinogenic mode of action is available, a threshold or nonlinear approach is used and a cancer RfD is calculated based on an earlier noncancer key event. If carcinogenic mode of action data is not available, or if the mode of action data determines a mutagenic mode of action, a default linear cancer slope factor approach is utilized. Based on the data summarized in Unit III.A., EPA has concluded that a nonlinear RfD approach is appropriate for assessing cancer risk for picoxystrobin. Cancer risk was assessed using the same exposure estimates as discussed in Unit III.C.1.ii., chronic exposure.

iv. Anticipated residue and percent crop treated (PCT) information. Section 408(b)(2)(E) of FFDCA authorizes EPA to use available data and information on the anticipated residue levels of pesticide residues in food and the actual levels of pesticide residues that have been measured in food. If EPA relies on such information, EPA must require pursuant to FFDCA section 408(f)(1) that data be provided 5 years after the tolerance is established, modified, or left in effect, demonstrating that the levels in food are not above the levels anticipated. For the present action, EPA will issue such data call-ins as are required by FFDCA section 408(b)(2)(E) and authorized under FFDCA section 408(f)(1). Data will be required to be submitted no later than 5 years from the date of issuance of these tolerances.

2. Dietary exposure from drinking water. The Agency used screening level water exposure models in the dietary exposure analysis and risk assessment for picoxystrobin in drinking water. These simulation models take into account data on the physical, chemical, and fate/transport characteristics of picoxystrobin. Further information regarding EPA drinking water models used in pesticide exposure assessment can be found at http://www.epa.gov/oppefed1/models/water/index.htm.

The drinking water assessment used a total toxic residue approach to include parent and the major environmental degradates: Compound 2, Compound 3, Compound 7, and Compound 8. Based on the Pesticide Root Zone Model/Exposure Analysis Modeling System and Screening Concentration in Ground Water models, the estimated drinking water concentrations of picoxystrobin for:

• Acute exposures are estimated to be 7.95 parts per billion (ppb) for surface water and 0.041 ppb for ground water.

• Chronic exposures for non-cancer assessments are estimated to be 2.41 ppb for surface water and 0.041 ppb for ground water.

Modeled estimates of drinking water concentrations were directly entered into the dietary exposure model. For acute dietary risk assessment, the water concentration value of 7.95 ppb was used to assess the contribution to drinking water. For chronic dietary risk assessment, the water concentration of value 2.41 ppb was used to assess the contribution to drinking water.

3. From non-dietary exposure. The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure (e.g., for lawn and garden pest control, indoor pest control, termiticides, and flea and tick control on pets). Picoxystrobin is not registered for any specific use patterns that would result in residential exposure.

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

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

1. In general. Section 408(b)(2)(C) 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 database on toxicity and exposure unless 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 FQPA Safety Factor (SF). In applying this provision, EPA either retains the default value of 10X, or uses a different additional safety factor when reliable data available to EPA support the choice of a different factor.

2. Prenatal and postnatal sensitivity. The prenatal and postnatal toxicity studies include rat and rabbit prenatal development studies, in addition to reproduction and fertility effects studies in rats. No evidence of increased qualitative or quantitative susceptibility/sensitivity was seen in any of these studies.

3. Conclusion. EPA has determined that reliable data show the safety of infants and children would be adequately protected if the FQPA Safety factor were reduced to 1X for chronic dietary exposure. For acute dietary exposures for the general population, including infants and children where the acute neurotoxicity is study used as an endpoint for risk assessment, EPA is retaining a 10X FQPA safety factor. That decision is based on the following findings:

i. Although all required toxicity studies for picoxystrobin have been submitted, the acute neurotoxicity study used for acute dietary risk assessment did not demonstrate a NOAEL, and a LOAEL was used as an endpoint. Therefore, the 10X FQPA safety factor was retained for use of a LOAEL to extrapolate a NOAEL.

ii. There is no indication that picoxystrobin is a neurotoxic chemical and there is no need for a developmental neurotoxicity study or additional UFs to account for neurotoxicity.

iii. There is no evidence that picoxystrobin results in increased susceptibility in in utero rats or rabbits in the prenatal developmental studies or in young rats in the 2-generation reproduction study.

iv. There are no residual uncertainties identified in the exposure databases. The dietary food exposure assessments were performed based on 100 PCT, total highest field trial total residues for acute exposures, total highest average field trial total residues for chronic exposures, and tolerance levels for livestock commodities. EPA made conservative (protective) assumptions in the ground and surface water modeling used to assess exposure to picoxystrobin in drinking water. These assessments will not underestimate the exposure and risks posed by picoxystrobin.

EPA determines whether acute and chronic dietary pesticide exposures are safe by comparing aggregate exposure estimates to the acute PAD (aPAD) and chronic PAD (cPAD). For linear cancer risks, EPA calculates the lifetime probability of acquiring cancer given the estimated aggregate exposure. Short-, intermediate-, and chronic-term risks are evaluated by comparing the estimated aggregate food, water, and residential exposure to the appropriate PODs to ensure that an adequate MOE exists.

1. Acute risk. Using the exposure assumptions discussed in this unit for acute exposure, the acute dietary exposure from food and water to picoxystrobin will occupy 1.3% of the aPAD for children 1-2 years old, the population group receiving the greatest exposure.

2. Chronic risk. Using the exposure assumptions described in this unit for chronic exposure, EPA has concluded that chronic exposure to picoxystrobin from food and water will utilize 2.8% of the cPAD for children 1-2 years old, the population group receiving the greatest exposure. There are no residential uses for picoxystrobin.

3. Short- and intermediate—term risks. Short- and intermediate— term risk aggregate exposures take into account residential exposure plus chronic exposure to food and water (considered to be a background exposure level). Because no short-term or intermediate-term adverse effects were identified, picoxystrobin is not expected to pose a short- or intermediate— term risk.

4. Aggregate cancer risk for U.S. population. The Agency considers the chronic aggregate risk assessment, making use of the cPAD, to be protective of any aggregate cancer risk.

5. Determination of safety. Based on these risk assessments, EPA concludes that there is a reasonable certainty that no harm will result to the general population or to infants and children from aggregate exposure to picoxystrobin residues.

Adequate enforcement methodology, (a liquid chromatography tandem mass spectrometry method (LC/MS/MS), is available to enforce the tolerance expression.

The method may be requested from: Chief, Analytical Chemistry Branch, Environmental Science Center, 701 Mapes Rd., Ft. Meade, MD 20755-5350; telephone number: (410) 305-2905; email address: residuemethods@epa.gov .

In making its tolerance decisions, EPA seeks to harmonize U.S. tolerances with international standards whenever possible, consistent with U.S. food safety standards and agricultural practices. EPA considers the international maximum residue limits (MRLs) established by the Codex Alimentarius Commission (Codex), as required by FFDCA section 408(b)(4). The Codex Alimentarius is a joint United Nations Food and Agriculture Organization/World Health Organization food standards program, and it is recognized as an international food safety standards-setting organization in trade agreements to which the United States is a party. EPA may establish a tolerance that is different from a Codex MRL; however, FFDCA section 408(b)(4) requires that EPA explain the reasons for departing from the Codex level. No Codex MRLs have been established for picoxystrobin.

The Agency has revised several of the commodity definitions and modified the levels for which tolerances are being established as follows: Vegetable, legume, dried shelled, except soybean, (group 6C) at 0.1 ppm is revised to pea and bean, dried shelled, except soybean, subgroup 6C at 0.06 ppm; soybean forage at 0.08 ppm is revised to soybean, forage at 1.0 ppm; soybean hay at 2.5 ppm is revised to soybean, hay at 3.0 ppm; soybean hulls at 10 ppm is revised to soybean, hulls at 0.2 ppm; canola, seed at 0.05 ppm is revised to rapeseed subgroup 20A at 0.08 ppm; barley, grain which was proposed as crop group 15 at 0.2 ppm is revised to barley, grain at 0.3 ppm. Tolerance for soybeans oil was proposed at 0.8 ppm, but EPA has determined that a tolerance is not needed. These tolerances have been revised based on the use of the Organization for Economic Co-operation and development tolerance calculation procedure (OECD TCP). Further, EPA determined that the proposed tolerance for crop group 15 (grain, cereal, except rice), and crop subgroup 7A group/subgroup (vegetable, foliage of legume) each be modified and established as follows: Grain, cereal, group 15, except rice and barley at 0.04 ppm; vegetable, foliage of legume, except soybean, subgroup 7A at 40.0 ppm. Crop group 16 (grain, cereal, forage and fodder except rice) however, should each be broken up and established with individual tolerances. These tolerances are revised as follows: Grain, cereal, forage, fodder, and straw, group 16, straw at 2.0 ppm; grain, cereal, forage fodder, and straw, group 16, stover at 10.0 ppm; grain, cereal, forage, fodder and straw group 16, hay at 5.0 ppm; grain, cereal forage, fodder, and straw, group 16, forage at 15.0 ppm;

Based on the corn processing study, the proposed tolerance for cereal grain oil at 1.5 ppm is revised to corn, field, refined oil at 0.07 ppm.

The proposed tolerance for cereal (wheat), aspirated grain fractions at 4.5 ppm is being established as grain, aspirated grain fractions at 10 ppm; soybean, aspirated grain fractions at 3.2 ppm is revised to grain, aspirated grain fractions at 10 ppm as well.

Though not proposed, the Agency has determined it was appropriate to establish tolerances for wheat, bran at 0.06 ppm; wheat, germ at 0.09 ppm; and barely, bran at 0.5 ppm.

EPA also revised livestock tolerances as follows, based on the calculated dietary burden to account for the transfer of residues to livestock matrices (tissues and milk): Cattle, fat from 0.05 ppm to 0.01 ppm; goat, fat from 0.05 ppm to 0.01 ppm; hog, fat from 0.05 ppm to 0.01 ppm. horse, fat from 0.5 ppm to 0.01 ppm; sheep, fat from 0.05 ppm to 0.01 ppm; horse, liver at 0.8 ppm and horse, meat byproduct, except liver at 0.01 ppm were combined as horse, meat byproduct at 0.01 ppm. Sheep, liver at 0.8 ppm and sheep, meat byproducts, except liver at 0.01 ppm were combined as sheep, meat byproducts, at 0.01 ppm. Goat, liver at 0.8 ppm and goat, meat byproducts, except liver at 0.01 ppm were combined as goat, meat byproducts at 0.01 ppm.; hog, liver at 0.8 ppm and hog, meat byproducts, except liver at 0.01 were combined as hog, meat byproducts at 0.01 ppm. Cattle, liver at 0.8 ppm and cattle, meat byproduct, except liver at 0.01 ppm were combined as cattle, meat byproducts at 0.01 ppm. Finally a tolerance was proposed on cream at 0.03 ppm; however EPA has determined that no tolerance is needed.

Therefore, tolerances are established for residues of picoxystrobin, methyl (αE)-α-(methoxymethylene)-2-[[[6-(trifluoromethyl)-2-pyridinyl]oxy]methyl]benzeneacetate in or on barley, bran at 0.5 ppm; barley, grain at 0.3 ppm; rapeseed subgroup 20A at 0.08 ppm; cattle, fat at 0.01 ppm; cattle, meat at 0.01 ppm; cattle, meat byproducts, at 0.01 ppm; corn, field, refined oil at 0.07 ppm; goat, fat at 0.01 ppm; goat, meat at 0.01 ppm; goat meat byproduct, at 0.01 ppm; grain, aspirated grain fractions at 10 ppm; grain, cereal, group 15, except rice and barely at 0.04 ppm; grain, cereal, forage, fodder, and straw, group 16, hay at 5.0 ppm; grain, cereal, forage, fodder, and straw, group 16, forage at 15 ppm; grain, cereal, forage, fodder, and straw group 16, stover at 10 ppm; grain, cereal, forage, fodder, and straw, group 16, straw at 2 ppm; hog, fat at 0.01 ppm; hog, meat at 0.01 ppm; hog, meat byproducts, at 0.01 ppm; horse, fat at 0.01 ppm; horse, meat at 0.01 ppm; horse, meat byproducts, at 0.01 ppm; milk at 0.01 ppm; pea and bean, dried shelled, except soybean, subgroup 6C at 0.06 ppm; eggs at 0.01 ppm; poultry, fat at 0.01 ppm; poultry, meat at 0.01 ppm; poultry, meat byproducts at 0.01 ppm; sheep, fat at 0.01 ppm; sheep, meat at 0.01 ppm; sheep, meat byproducts, at 0.01 ppm; soybean, forage at 1 ppm; soybean, hay at 3 ppm; soybean, hulls at 0.2 ppm; soybean, seed at 0.05 ppm; vegetable, foliage of legume, except soybean, subgroup 7A at 40 ppm; wheat, bran at 0.06 ppm; and wheat, germ at 0.09 ppm.

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

Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance 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 FFDCA section 408(n)(4). 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) (2 U.S.C. 1501 et seq. ).

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) (15 U.S.C. 272 note).

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 action is not a “major rule” as defined by 5 U.S.C. 804(2).

Therefore, 40 CFR chapter I 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:

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

You may access a frequently updated electronic version of EPA's tolerance regulations at 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-2011-0743 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 February 4, 2013. 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 (excluding any Confidential Business Information (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 the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2011-0743, 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 CBI or other information whose disclosure is restricted by statute.

• Mail: OPP Docket, Environmental Protection Agency Docket Center (EPA/DC), (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. Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at http://www.epa.gov/dockets.

In the Federal Register of August 22, 2012 (77 FR 50661) (FRL-9358-9), EPA issued a notice pursuant to FFDCA section 408(d)(3), 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide petition (PP 1F7872) by Agriphar S.A., c/o Ceres International LLC, 1087 Heartsease Drive, West Chester, PA 19382. The petition requested that 40 CFR 180.172 be amended by establishing tolerances for residues of the fungicide dodine, ( N -dodecyl guanidine acetate), in or on stone fruits (group 12) at 5 parts per million (ppm); tree nuts (group 14) at 0.3 ppm; and almond, hulls at 20 ppm. The petitioner also requested that the tolerances in 40 CFR 180.172 be amended by removing established tolerances for residues of dodine as follows: Cherry, sweet at 3 ppm; cherry, tart at 3 ppm; peach at 5 ppm; pecan at 0.3 ppm; and walnut at 0.3 ppm. These tolerances would be redundant if the crop group tolerances for stone fruits (group 12) and tree nuts (group 14) are established. That notice referenced a summary of the petition prepared by Agriphar S.A., c/o Ceres International LLC, the registrant, which is available in the docket, http://www.regulations.gov. There were no comments received in response to the notice of filing.

Based upon review of the data supporting the petition, EPA has raised the requested tolerance level for almond, hull. The reason for this change is explained in Unit IV.C.

Section 408(b)(2)(A)(i) of FFDCA allows EPA to establish a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(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. Section 408(b)(2)(C) of FFDCA 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(b)(2)(D), and the factors specified in FFDCA section 408(b)(2)(D), 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 dodine, including exposure resulting from the tolerances established by this action. EPA's assessment of exposures and risks associated with dodine follows.

EPA has evaluated the available toxicity data and considered its validity, completeness, and reliability as well as the relationship of the results of the studies 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.

Dodine is moderately toxic via the acute oral, dermal and inhalation routes of exposure. It is a severe eye irritant and causes severe dermal irritation; it is not a skin sensitizer. A definitive target organ has not been identified for dodine. The most common effects observed in sub-chronic and chronic studies were decreases in food consumption, body weight and/or body weight gain. Possible neurological clinical signs (excessive salivation and hunched posture/hypoactivity) were observed in chronic studies in rats and mice but were not dose-related or statistically significant. Excessive salivation in the chronic study in dogs was not consistent with a neurological adverse effect since it was seen prior to dosing and was a persistent finding throughout the study. Therefore, there is no evidence of neurotoxicity and the acute and subchronic neurotoxicity studies are not required (HASPOC, October 25, 2012). The current database does not indicate concerns for immunotoxicity and the registrant has agreed to perform an immunotoxicity study (OCSPP Guideline 870.7800). Therefore, the Food Quality Protection Act (FQPA) safety factor is reduced to 1X.

There is no evidence of increased susceptibility (quantitative or qualitative) in pups versus adults based on rat and rabbit developmental studies and the rat multi-generation reproduction study. In rat and rabbit prenatal developmental studies, there was no toxicity identified in the fetuses up to the highest dose tested (HDT). In the 2-generation reproduction study, decreases in body weight gain and food consumption were seen in pups at the same dose at which maternal toxicity (decreased body weight, body weight gain and food consumption) was observed.

There was equivocal evidence of carcinogenicity in animal carcinogenicity studies; however, a weight-of-evidence evaluation of the carcinogenic potential of dodine was performed, and based on the results it was concluded that dodine should be classified as Not Likely to be Carcinogenic to Humans based on the following:

(1) There was no evidence of tumors in male mice or in rats of either sex;

(2) In female mice, the increase in incidence of combined tumors is marginal (8.3%) compared to historical controls (8%), and there were no pre-neoplastic lesions that can be associated with the tumor response, and therefore no evidence that the high dose was associated with further progression to carcinoma;

(3) There was no evidence of genotoxicity, and therefore no mutagenicity concern; and

(4) The Structure Activity Relationship (SAR) assessment does not indicate probable carcinogenicity. Factors bearing on this weight of the evidence determination are described in “Dodine: Human Health Risk Assessment for Proposed Use Bananas and Peanuts,” pages 20-21 in docket ID number EPA-HQ-OPP-2007-0221, at http://www.regulations.gov. In the absence of carcinogenicity concern, risk assessment using the chronic population adjusted dose will be protective for any chronic toxicity.

Specific information on the studies received and the nature of the adverse effects caused by dodine as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies can be found at http://www.regulations.gov in document “Dodine. Amended Human Health Risk Assessment to Support Use on Stone Fruit and Tree Nut Crops,” pages 14 and 42 in docket ID number EPA-HQ-OPP-2011-0743.

Once a pesticide's toxicological profile is determined, EPA identifies toxicological points of departure (POD) and levels of concern to use in evaluating the risk posed by human exposure to the pesticide. For hazards that have a threshold below which there is no appreciable risk, the toxicological POD is used as the basis for derivation of reference values for risk assessment. PODs are developed based on a careful analysis of the doses in each toxicological study to determine the dose at which no adverse effects are observed (the NOAEL) and the lowest dose at which adverse effects of concern are identified (the LOAEL). Uncertainty/safety factors are used in conjunction with the POD to calculate a safe exposure level—generally referred to as a population-adjusted dose (PAD) or a reference dose (RfD)—and a safe margin of exposure (MOE). For non-threshold risks, the Agency assumes that any amount of exposure will lead to some degree of risk. Thus, the Agency estimates risk in terms of the probability of an occurrence of the adverse effect expected in a lifetime. For more information on the general principles EPA uses in risk characterization and a complete description of the risk assessment process, see http://www.epa.gov/pesticides/factsheets/riskassess.htm.

A summary of the toxicological endpoints for dodine used for human risk assessment is shown in the following Table.

1. Dietary exposure from food and feed uses. In evaluating dietary exposure to dodine, EPA considered exposure under the petitioned-for tolerances as well as all existing dodine tolerances in 40 CFR 180.172. EPA assessed dietary exposures from dodine in food as follows:

i. Acute exposure. Quantitative acute dietary exposure and risk assessments are performed for a food-use pesticide, if a toxicological study has indicated the possibility of an effect of concern occurring as a result of a 1-day or single exposure.

No such effects were identified in the toxicological studies for dodine; therefore, a quantitative acute dietary exposure assessment is unnecessary.

ii. Chronic exposure. In conducting the chronic dietary exposure assessment EPA used the food consumption data from the USDA 1994-1996 and 1998 Continuing Survey of Food Intakes by Individuals (CSFII). As to residue levels in food, EPA assumed tolerance level residues for all treated crops. In terms of extent of usage, percent crop treated (PCT) information was used for apples, cherries, peaches, pears, peanuts, pecans, and strawberries. One hundred PCT was assumed for the remainder of crops.

iii. Cancer. Based on the data discussed in Unit III.A., EPA determined that dodine did not pose a carcinogenicity concern and that risk assessment using the chronic population adjusted dose will be protective for any chronic toxicity. Accordingly, no exposure assessment, separate from the chronic assessment, was conducted with regard to cancer risk.

iv. PCT information. Section 408(b)(2)(F) of FFDCA states that the Agency may use data on the actual percent of food treated for assessing chronic dietary risk only if:

• Condition a: The data used are reliable and provide a valid basis to show what percentage of the food derived from such crop is likely to contain the pesticide residue.

• Condition b: The exposure estimate does not underestimate exposure for any significant subpopulation group.

• Condition c: Data are available on pesticide use and food consumption in a particular area, the exposure estimate does not understate exposure for the population in such area.

In addition, the Agency must provide for periodic evaluation of any estimates used. To provide for the periodic evaluation of the estimate of PCT as required by FFDCA section 408(b)(2)(F), EPA may require registrants to submit data on PCT.

The Agency estimated the PCT for existing uses as follows:

The Agency used the following PCT information for the currently registered uses of dodine: 10% PCT for pecans, 5% PCT for cherries and pears, 2.5% PCT for apples and peanuts along with 1% PCT for peaches and strawberries.

In most cases, EPA uses available data from U.S. Department of Agriculture/National Agricultural Statistics Service (USDA/NASS), proprietary market surveys, and the National Pesticide Use Database for the chemical/crop combination for the most recent 6-7 years. EPA uses an average PCT for chronic dietary risk analysis. The average PCT figure for each existing use is derived by combining available public and private market survey data for that use, averaging across all observations, and rounding to the nearest 5%, except for those situations in which the average PCT is less than 1. In those cases, 1% is used as the average PCT and 2.5% is used as the maximum PCT. EPA uses a maximum PCT for acute dietary risk analysis. The maximum PCT figure is the highest observed maximum value reported within the recent 6 years of available public and private market survey data for the existing use and rounded up to the nearest multiple of 5%.

The Agency believes that the three conditions discussed in Unit III.C.1.iv. have been met. With respect to Condition a, PCT estimates are derived from Federal and private market survey data, which are reliable and have a valid basis. The Agency is reasonably certain that the percentage of the food treated is not likely to be an underestimation. As to Conditions b and c, regional consumption information and consumption information for significant sub-populations is taken into account through EPA's computer-based model for evaluating the exposure of significant subpopulations including several regional groups. Use of this consumption information in EPA's risk assessment process ensures that EPA's exposure estimate does not understate exposure for any significant subpopulation group and allows the Agency to be reasonably certain that no regional population is exposed to residue levels higher than those estimated by the Agency. Other than the data available through national food consumption surveys, EPA does not have available reliable information on the regional consumption of food to which dodine may be applied in a particular area.

2. Dietary exposure from drinking water. The Agency used screening level water exposure models in the dietary exposure analysis and risk assessment for dodine in drinking water. These simulation models take into account data on the physical, chemical, and fate/transport characteristics of dodine. Further information regarding EPA drinking water models used in pesticide exposure assessment can be found at http://www.epa.gov/oppefed1/models/water/index.htm.

Based on the FQPA Index Reservoir Screening Tool (FIRST) and Screening Concentration in Ground Water (SCI-GROW) models, the estimated drinking water concentrations (EDWCs) of dodine for chronic exposures for non-cancer assessments are estimated to be 1.79 parts per billion (ppb) for surface water and <0.05 ppb for ground water.

Modeled estimates of drinking water concentrations were directly entered into the dietary exposure model. For chronic dietary risk assessment, the water concentration of value 1.79 ppb was used to assess the contribution to drinking water.

3. From non-dietary exposure. The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure (e.g., for lawn and garden pest control, indoor pest control, termiticides, and flea and tick control on pets).

Dodine is not registered for any specific use patterns that would result in residential exposure. However, a closely related chemical, dodecylguanidine hydrochloride (DGH) is used as an antimicrobial in household, industrial, and commercial products having residential and occupational exposure potential. DGH is used as a bacteriostat in paints and in absorbent material in disposal diapers. Dodine and DGH have similar chemical compositions and properties and are therefore considered bio-equivalents.

Residential painters may have short term dermal and inhalation exposure as a result of using DGH treated paint. Infants and small children may have short-, intermediate-, and long-term dermal exposure as a result of wearing DGH impregnated diapers. The Agency believes that a transfer factor of 30% does not underestimate exposure in determining the amount of DGH transferred to infants from diapers based on a transfer study using dodine-treated paper exposed to extreme conditions. Inhalation exposure of infants and children is expected to be negligible. Although small children may have short-term post application oral exposure as a result of accidental ingestion of paint chips which contain DGH, the Agency does not believe that this would occur on a regular basis.

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

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

1. In general. Section 408(b)(2)(C) 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 database on toxicity and exposure unless 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 FQPA Safety Factor (SF). In applying this provision, EPA either retains the default value of 10X, or uses a different additional safety factor when reliable data available to EPA support the choice of a different factor.

2. Prenatal and postnatal sensitivity. There is no evidence (quantitative or qualitative) of increased susceptibility and no residual uncertainties with regard to prenatal and/or postnatal toxicity following in utero exposure to rats or rabbits. In rat and rabbit prenatal developmental studies, there was no toxicity identified in the fetuses up to the HDT. In the 2-generation reproduction study, decreases in body weight gain and food consumption were seen in pups at the same dose at which maternal toxicity (decreased body weight, body weight gain and food consumption) was observed.

3. Conclusion. EPA has determined that reliable data show the safety of infants and children would be adequately protected if the FQPA SF were reduced to 1X. That decision is based on the following findings:

The toxicity database for dodine is mostly complete. The database contains the following toxicity studies:

i. A sub-chronic mouse toxicity study.

ii. Chronic rat, mouse, and dog toxicity studies.

iii. A 28-day dermal and dermal penetration studies (rats.

iv. Prenatal developmental studies (rats and rabbits).

v. A reproduction study in rats.

There are also acute LD 50 studies via the oral, dermal and inhalation routes, a metabolism study, and a complete mutagenicity battery. The current database does not indicate neurotoxicity or immunotoxicity concerns. Thus, EPA has waived the acute and subchronic neurotoxicity studies. An immunotoxicity study is required pursuant to the recent amendment of EPA's data regulations to evaluate the potential of a repeated chemical exposure to produce adverse effects (i.e., suppression) on the immune system. However, because no immunotoxicity was observed in available toxicity studies, EPA has confidence that this study is unlikely to change the POD in assessing risk to infants and children.

a. There is no evidence that dodine results in increased susceptibility in in utero rats or rabbits in the prenatal developmental studies or in young rats in the 2-generation reproduction study.

b. There are no residual uncertainties identified in the exposure databases. The dietary food exposure assessments were performed based on Agency recommended tolerance-level residues and health protective modeling assumptions. Although PCT estimates were used for crops with existing tolerances, the use of tolerance values for residue levels will likely overestimate actual exposures. EPA made conservative (protective) assumptions in the ground and surface water modeling used to assess exposure to dodine in drinking water. EPA used similarly conservative assumptions to assess postapplication exposure of children, as well as incidental oral exposure of children and incidental oral exposure of toddlers. These assessments will not underestimate the exposure and risks posed by dodine.

EPA determines whether acute and chronic dietary pesticide exposures are safe by comparing aggregate exposure estimates to the acute PAD (aPAD) and chronic PAD (cPAD). For linear cancer risks, EPA calculates the lifetime probability of acquiring cancer given the estimated aggregate exposure. Short-, intermediate-, and chronic-term risks are evaluated by comparing the estimated aggregate food, water, and residential exposure to the appropriate PODs to ensure that an adequate MOE exists.

1. Acute risk. An acute aggregate risk assessment takes into account acute exposure estimates from dietary consumption of food and drinking water. No adverse effect resulting from a single oral exposure was identified and no acute dietary endpoint was selected. Therefore, dodine is not expected to pose an acute risk.

2. Chronic risk. Using the exposure assumptions described in this unit for chronic exposure, EPA has concluded that chronic exposure to dodine from food and water will utilize 21% of the cPAD for all infants <1 year old, the population group receiving the greatest exposure. Further, EPA has concluded that the combined long-term food, water, and dermal exposure for infants wearing diapers containing DGH treated material results in an aggregate MOE greater than 100. Because EPA's level of concern for dodine is for MOEs below 100, this MOE does not raise a risk concern.

3. Short- and intermediate-term risk. Short- and intermediate-term aggregate exposure takes into account short- and intermediate-term 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 short- and intermediate-term exposures, EPA has concluded the combined short- and intermediate-term combined food, water, and residential exposures aggregated result in aggregate MOEs of 4,200 for adult males handling paint and 4,500 for adult females handling paint. The exposures do not exceed the Agency's level of concern. EPA has concluded that the combined intermediate-term food, water, and dermal exposure for infants wearing diapers containing DGH treated material results in aggregate MOEs of 120 when using a 30% transfer factor. Because EPA's level of concern for dodine is for MOEs below 100, this MOE does not raise a risk concern.

4. Aggregate cancer risk for U.S. population. Based on the data discussed in Unit III.A., EPA concluded that dodine is not expected to pose a cancer risk to humans.

5. Determination of safety. Based on these risk assessments, EPA concludes that there is a reasonable certainty that no harm will result to the general population, or to infants and children, from aggregate exposure to dodine residues.

Adequate enforcement methodology (colormetric method with spectrometric detection and various modifications is listed in FDA's Pesticide Analytical Manual (PAM), Volume II as Methods I, I(a), I(b), and I(d)) is available to enforce the tolerance expression.

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

The Codex has not established MRLs for dodine on the tree nut crop group. The Codex has established MRLs for dodine in or on cherries, sweet and cherries, tart at 3 ppm and on peaches and nectarines at 5 ppm. The Codex MRL for cherries is not harmonized with the stone fruit crop group tolerance of 5 ppm.

Harmonization with the Codex MRL for cherries is not possible because the cherry field trial data shows that residues from the domestic, labeled use may exceed the 3 ppm Codex MRL making it impractical for limits to be harmonized based on the proposed domestic use pattern. However, the cherry data when considered as part of the data set to support a stone fruit crop group tolerance, indicate that a 5 ppm crop group tolerance would be appropriate. To harmonize to the best extent possible with Codex, the crop group tolerance will be set at 5 ppm, This at least harmonizes the Codex and U.S. tolerances for peaches and nectarines.

Based on the analysis of the residue trial data using the Organization for

Economic Cooperation and Development (OECD) tolerance calculation procedures, tolerances for almond hulls were increased.

Therefore, tolerances are established for residues of dodine, N -dodecylguanidine acetate, including its metabolites and degradates, in or on almond, hulls at 30 ppm; fruit, stone, crop group 12 at 5.0 ppm; and nuts, tree, crop group 14 at 0.3 ppm. This final rule removes established tolerances for cherry, sweet; cherry, tart; peach; pecan; and walnut.

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

Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance 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 FFDCA section 408(n)(4). 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) (2 U.S.C. 1501 et seq. ).

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) (15 U.S.C. 272 note).

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 action is not a “major rule” as defined by 5 U.S.C. 804(2).

Therefore, 40 CFR chapter I is amended as follows:

This is a summary of the Commission's Second Order on Reconsideration (Order), FCC 12-127, adopted October 11, 2012, and released October 12, 2012. The full text of the Order is available for inspection and copying during regular business hours in the FCC Reference Center, 445 12th Street SW., Room CY-A257, Portals II, Washington, DC 20554, and may also be purchased from the Commission's copy contractor, BCPI, Inc., Portals II, 445 12th Street SW., Room CY-B402, Washington, DC 20554. Customers may contact BCPI, Inc. via their Web site, http://www.bcpi.com, or call 1-800-378-3160. This document is available in alternative formats (computer diskette, large print, audio record, and Braille). Persons with disabilities who need documents in these formats may contact the FCC by email: FCC504@fcc.gov or phone: 202-418-0530 or TTY: 202-418-0432.

1. In the Order, the Commission addressed six petitions for reconsideration, petitions for partial reconsideration, and petitions for clarification of certain procedures adopted in the Second R&O in this proceeding (76 FR 18942, April 6, 2011, FCC 11-28, 26 FCC Rcd 2556, rel. Mar. 3, 2011). These included a number of measures designed to limit the use of population as the principal metric when considering competing proposals for new radio stations, a standard that has largely favored proposals located in or near large urbanized areas, rather than those located in less well-served rural areas and smaller communities. In the Second R&O, the Commission adopted procedures to limit dispositive preferences under 47 U.S.C. 307(b) (section 307(b)) for new AM construction permits, as well as new FM allotments, in already well-served urbanized areas.

2. The Commission also adopted procedures to forestall the movement of radio service from rural areas to more urban areas absent a compelling showing of need. Among these procedures was an urbanized area service presumption (UASP), under which a proposal for new or relocated radio service that would constitute the first local transmission service at a specified community is presumed to be a proposal to serve an entire urbanized area if the community is located within the urbanized area, or if the proposal would place, or could be modified to place, a daytime principal community signal over 50 percent or more of the urbanized area. The UASP can be rebutted by a compelling showing (1) that the specified community is truly independent of the urbanized area, (2) that the community has a specific need for an outlet for local expression separate from the urbanized area and (3) that the proposed station is able to provide that outlet. The basis for such a rebuttal showing is the longstanding test first set forth in Faye and Richard Tuck, Memorandum Opinion and Order, 3 FCC Rcd 5374, 5376 (1988) ( Tuck ), as slightly modified in the Second R&O. The UASP applies, albeit in somewhat different forms, to applications for new AM stations, proposals for new FM allotments, and applications to change a station's community of license.

3. The Commission also limited the circumstances under which a mutually exclusive applicant for a new AM station may receive a dispositive section 307(b) preference under Priority (4), other public interest matters, of the Commission's allotment priorities. In the context of proposals for new FM allotments, raw reception population totals will receive less weight than other legitimate service-based considerations, especially service to underserved populations. The UASP also applies to applications to change a station's community of license. Additionally, with regard to such applications, the Commission mandated greater transparency in applicants' section 307(b) showings, including the submission of more detailed showings demonstrating the populations gaining and losing radio service, and the numbers of services those populations receive before and after the proposed move. The Commission also announced it would strongly disfavor any proposed community of license change that would result in the net loss of third, fourth, or fifth reception service to more than 15 percent of the population in the station's current protected contour, or loss of a second local transmission service to a community with a population of 7,500 or greater. With two exceptions, the Commission stated that the new procedures would apply to all applications or proposals pending as of the Second R&O's adoption date.

4. Most of the Petitions for Reconsideration or Partial Reconsideration (Petitions) merely repeated points from the comments filed in this proceeding that were considered and rejected in the Second R&O. On that basis, the Commission denied the Petitions filed by Friendship Broadcasting, LLC; William B. Clay; M&M Broadcasters, Ltd.; and Educational Media Foundation and the Kent Frandsen Radio Companies. The Commission granted in part and denied in part the Petitions filed by Entravision Communications Corporation (Entravision) and Radio One, Inc., et al. (Radio One Parties). The Commission did address requests for clarification of certain issues, specifically, for clarification of the methodology for calculating reception service in section 307(b) analyses under Priority (4), other public interest matters; for clarification or amendment of some of the factors used to determine whether a community is independent of an urbanized area; and for clarification of the applicability of the UASP to intra-urbanized area station relocations. The Commission also addressed the requests of petitioners M&M Broadcasters, Inc. (M&M) and Entravision to exclude certain pending community of license change applications from the new policies.

5. Although many of the arguments in the Petitions were considered and rejected in the Second R&O, the Commission found it to be in the public interest to discuss the merits of these arguments in light of its contrary determinations. While some petitioners argued that the new procedures “ignore current marketplace realities,” causing radio stations to relocate to more populous areas because there is little or no money to be made in rural areas, the Commission reiterated that new stations are assigned or allotted on a demand basis, with the economic decision to locate a station in a particular community resting solely with the applicant. To the extent that changed circumstances render it an economic hardship for a station to remain in its community of license, the new procedures allow for such a showing. The Commission again rejected the suggestion that rural residents should simply purchase any radio service they desire above “basic” broadcast service of as few as two reception services, or that section 307(b) obliges it only to assign minimal free radio service to certain Americans, based solely on where they choose to live.

6. The Radio One Parties contended that the new procedures, particularly the UASP, were arbitrary and capricious, based largely on reiterating arguments made in their comments, which were mostly confined to the context of community of license change applications. The Commission rejected the Radio One Parties' re-argument that “only” 19 percent of community of license change applications would trigger the UASP, and thus that this level of activity is insufficient to warrant remedial agency action. The Commission stated that the number of comments in the record indicating a strong interest of many radio broadcasters in relocating to more populated areas reflects the importance of the UASP as a section 307(b) licensing policy. For the reasons set forth in the Second R&O, the Commission reiterated that allowing such migration in all cases does not comport with its statutory duty under section 307(b), also noting that because the UASP is a presumption rather than a hard-and-fast rule, a licensee seeking to relocate its facilities due, for example, to changed conditions in its current community of license may rebut the presumption. Additionally, the Commission rejected the Radio One Parties' argument that the UASP constitutes an improper attempt to assume an applicant's service intentions based on the fact that the population of the proposed community of license may constitute a very small percentage of the overall coverage population. The UASP was not designed to divine an applicant's service intent, but rather to eliminate the undue, often dispositive advantage that prior section 307(b) policies conferred on proposals to serve communities located in large urbanized areas, especially in the context of selecting among mutually exclusive applications for new AM service. This advantage was based largely on the fact, supported by the record, that applicants would often designate as the community of license a community lacking local transmission service but whose population constituted a small percentage of the total audience to be served, to the detriment of mutually exclusive applicants proposing service to smaller, non-urbanized communities that might benefit more from new service.

7. The Radio One Parties again argued that the new procedures constitute a return to the policies eliminated in The Suburban Community Policy, the Berwick Doctrine, and the De Facto Reallocation Policy, Report and Order, 93 F.C.C.2d 436 (1993), an argument considered and rejected in the Second R&O. The Commission in that proceeding discontinued those policies based in part on application processes and procedural safeguards that now no longer exist. The Commission in the Second R&O also noted the dissimilarities between its new procedures and the processes formerly used to implement the policies that were discontinued in Suburban Community Policy. To the extent that similarities exist, it is because both are grounded in fulfilling the Commission's section 307(b) responsibilities. The record in this proceeding and the Commission's recent experience with broadcast auctions and community of license change proposals filed as minor modification applications—both licensing processes that post-date Suburban Community Policy by many years—convinced the Commission that the new procedures are necessary.

8. The Commission declined the Radio One Parties' request that it revise the eight factors, first enumerated in the Tuck case, that are used to evaluate the interdependence of the community of license specified by the applicant with the larger metropolitan area. It did, however, agree that some of the factors should be accorded less weight. For example, while disagreeing with the Radio One Parties' claim that the closing or consolidation of post office facilities necessarily invalidates the use of the remaining ZIP code as an indicator of community independence, the Commission agreed that the ubiquity of ZIP codes gives the presence of a dedicated ZIP code little probative significance of itself in establishing a community's independence, and thus that this factor should be given little weight. While generally declining to revise the Tuck factors, the Commission noted that it would provide applicants seeking to rebut the UASP wide latitude to present whatever facts they deem appropriate to its evaluation. While such showings would be scrutinized, the Commission will be receptive to presentations that may in some cases provide better and more reliable measures of community status than those set forth in Tuck . The Commission further emphasized that the eight Tuck factors are merely potential indicators of independence or interdependence, and that the burden remains on the applicant to show that the presence of such factors provides meaningful and relevant support for an “independent” community finding. The Commission also clarified that its analysis of showings rebutting the UASP will place primary emphasis on the first two prongs of the Tuck test, namely, the degree to which the proposed station would provide coverage to the urbanized area, and the size and proximity of the proposed community of license relative to the central city of the urbanized area.

9. The Radio One Parties also asked that the Commission clarify the methodology for measuring “reception service” for Priority (4) analyses of applications to change a station's community of license, as discussed in paragraph 39 of the Second R&O. Specifically, they ask, first, whether the contours of a non-reserved band FM station, for purposes of gain/loss analysis of a community of license change, should be calculated from the allotment coordinates at the proposed new community or from the transmitter coordinates specified in the actual proposal; second, when evaluating gain and loss areas, and in particular when determining the number of reception services to the gain and loss areas, which signal contour should be used; and third, in assessing reception service, whether “potential services,” such as vacant FM allotments or granted but unbuilt construction permits, should be counted. The Commission clarified the standards for evaluating reception services in the gain and loss areas for applications to change community of license, and thus granted the Radio One Petition in part.

10. First, when determining gain and loss areas for an FM station changing its community of license, the contours should be calculated using the authorized transmitter coordinates for the current facility, and the transmitter coordinates specified for the proposed new or modified facility. This is a change from past practice, under which the staff used allotment coordinates rather than the transmitter coordinates specified in the actual proposal. That practice, however, was an artifact of former licensing procedures, under which all community of license changes for FM stations first involved a reallotment of the station's channel at the new community. Since the Commission changed its procedures in 2006 to permit the filing of community of license change proposals by minor change applications, the staff can now evaluate the actual proposed transmitter site. It is more appropriate to do so than to use allotment coordinates that may be miles from the actual transmitter site specified in the proposal. Moreover, this new approach is consistent with Commission practice regarding AM change of community applications, for which contours are calculated from the applicants' authorized and proposed transmitter sites.

11. Second, the Commission clarified that, when determining the number of reception services in gain and loss areas, the signal level to be evaluated for non-reserved band FM stations (including noncommercial educational [NCE] stations in the non-reserved band) shall be the service contour originating at the currently authorized and proposed transmitter coordinates. The service contour shall be calculated based on the facility's authorized and proposed effective radiated power (ERP) and height above average terrain (HAAT) and shall, as described below, take into account actual terrain. This is a departure from the method previously used to determine the number of reception services in gain and loss areas, which was based on maximum class facilities for all FM stations except for full Class C and NCE stations, and did not take into account actual terrain. However, in the Second R&O, the Commission required applicants proposing to change a station's community of license to provide detailed reports of populations receiving service and the numbers of services received. This increased scrutiny of the current and proposed reception service landscape demands a realistic picture of the populations receiving various levels of service, overruling the considerations of “uniformity and certainty” in service area calculations previously cited to justify the use of maximum rather than actual facilities. See Greenup, Kentucky and Athens, Ohio, Memorandum Opinion and Order, 6 FCC Rcd 1493, 1494 (1991). Moreover, population counts using the new methodology do not lack certainty. Additionally, many existing stations, for technical, economic, or other reasons, may never be able to realize full class facilities. Thus, the Commission believed it more appropriate to base an evaluation of the section 307(b) merits of community of license change applications on the populations actually receiving service from stations in an area, rather than on what may be, in many cases, merely a hypothetical level of reception service. For purposes of these gain and loss area calculations, the FM service contour shall be that set forth for the class of station in 47 CFR 73.215(a)(1), and shall be calculated using actual terrain under the standard prediction methodology set forth in 47 CFR 73.313 rather than assuming uniform terrain. For NCE reserved band stations, the service contours will be determined in the same manner, using actual currently authorized and proposed facilities (including directional patterns) and actual terrain. The service contour shall be the 60 dBμ contour, calculated as set forth in 47 CFR 73.509(c)(1).

12. For an AM station, the signal level to be evaluated for purposes of gain and loss calculations in applications to change community of license shall be the predicted or measured daytime 2.0 mV/m groundwave contour, calculated from the current and proposed transmitter coordinates using authorized facilities. When calculating AM reception services in gain and loss areas under Priority (4), “reception service” should include all AM daytime reception services. In this regard, the Commission noted that the AM primary service contours are set forth in 47 CFR 73.182(d), and are the daytime 0.5 mV/m groundwave contour for communities under 2,500 population, and the daytime 2.0 mV/m groundwave contour for communities over 2,500 population. The different primary service contours take into account the higher level of environmental noise resulting from greater population density. However, using different contours for communities of different sizes will often result in complicated calculations of the number of services to certain areas lying between the daytime 2.0 mV/m and 0.5 mV/m groundwave contours of an AM station. Because 47 CFR 73.182 implicitly recognizes that all areas, of whatever population, receive primary service within an AM station's daytime 2.0 mV/m groundwave contour, for purposes of determining the number of AM services and populations in gain and loss areas, the daytime 2.0 mV/m groundwave contour should be used. Applicants for new commercial AM stations providing showings under section 307(b) should, however, continue to count populations to be served by using the primary service contours (0.5 mV/m for communities under 2,500 population, 2.0 mV/m for communities over 2,500) set forth in 47 CFR 73.182(d). An applicant for a new AM station provides a section 307(b) showing only after being directed to do so by the staff (that is, after its application has been determined to be mutually exclusive with one or more other AM proposals), and in such cases the staff typically directs the applicant to provide the populations receiving both 0.5 mV/m and 2.0 mV/m daytime service from the proposed facilities.

13. Third, for purposes of the gain and loss calculations in Priority (4) analyses, as described in paragraph 39 of the Second R&O, applicants shall count all full-service AM (including daytime-only AM), 1 FM, and NCE FM stations, including granted, but unbuilt, construction permits for new stations. However, for purposes of these calculations applicants should not count vacant FM allotments. For the reasons cited above, the increased scrutiny of reception service in gain and loss areas requires an evaluation of actual, rather than hypothetical service. Thus, the Commission will evaluate the reception service as of the time of application, and will count only those facilities that have advanced to the point of a granted construction permit. Accordingly, in conducting the remaining services analysis and making a showing as described in paragraph 39 of the Second R&O, applicants should exclude vacant FM allotments from counts of reception services. Applicants for changes to a station's community of license following release of the Order shall use these clarified procedures when determining the number of reception services to gain and loss areas, and the procedures shall also apply to pending applications. However, the Commission found that because the Radio One Petition did not constitute notice to applicants of the exact nature of any clarifications of procedure on reconsideration, it shall allow parties with pending change of community applications as of the release date of the Order the option of either amending their application showings to conform to the clarified procedures announced in the Order, or proceeding based on the reception service counts in their already-filed technical showings.

14. While, as noted above, vacant FM allotments will not be included in counts of reception services, the Commission will continue to count vacant FM allotments for purposes of section 307(b) analyses under Priority (3), provision of first local transmission service. This is because only one applicant or allotment proponent can claim to provide “first” transmission service at a given community. It would be inappropriate to accept a claim by a community of license change applicant to provide first local transmission service at the new community, if a channel had already been allotted there based on a showing that the allotment would constitute the first local transmission service. Of course, should the only channel allocated to a community be re-allotted to another community, a subsequent applicant or allotment proponent could propose first local transmission service there.

15. Petitioner William Clay (Clay) sought reconsideration, arguing that the new procedures will still allow grant of most applications claiming to provide first local transmission service while primarily serving communities and populations other than the proposed community of license, because the majority of the proposed communities are not located in or near urbanized areas and are thus not subject to the UASP, and further arguing that the procedures set forth in the Second R&O still fail to guarantee service to, and an outlet for self-expression of, the nominal community of license rather than the greatest populations to be served by a proposal. Clay contended, as he did in comments, that any new procedure should grant any local service preference to the community or collection of communities most likely to benefit from a proposed new service, no matter where situated. The Commission rejected Clay's proposal as overbroad, finding that its approach struck an appropriate balance between encouraging the goals of localism, allowing an applicant to propose to provide a chosen community with an outlet for expression, and the economic reality that a broadcaster will and must also provide for the needs and interests of its entire service area, of which the designated community of license may constitute a very small percentage. The record and the Commission's experience has shown this problem to be most acute in the case of applications for new and relocated radio service in and near urbanized areas, hence the limitation of the UASP to situations in which a station is located in or will cover most of an urbanized area. The Commission found that the new procedures will promote the Commission's goals under section 307(b) in a reasonable manner. See AT&T Corp. v. FCC, 220 F.3d 607, 621 (D.C. Cir. 2000) (“As long as the agency's interpretation is reasonable, we uphold it `regardless whether there may be other reasonable, or even more reasonable, views.' ” quoting Serono Lab, Inc. v. Shalala, 158 F.3d 1313, 1321 (D.C. Cir. 1998)).

16. Entravision, in its Petition for Reconsideration and/or Clarification, raised issues concerning two aspects of the modified procedures. First, noting that the Commission had not typically required a Tuck showing for community of license change applications where both the current and the proposed communities of license are located in the same urbanized area, Entravision asked that the Commission clarify whether the UASP will apply, and a Tuck showing be required, in such situations in the future. The Commission clarified that Tuck showings will not be required where both the current and proposed communities are located in the same urbanized area, or the current facilities cover, and the proposed facilities would or could be modified to cover, more than 50 percent of the same urbanized area with a daytime principal community signal. However, in such community of license change cases, the UASP presumption would apply to the new community, i.e., would presumptively prohibit treating the service at the new community as a first local transmission service under Priority (3). Thus, in the absence of a showing to rebut the presumption that either the move-out or move-in community is sufficiently independent to warrant a first local transmission service priority, the applicant must make its showing under Priority (4), other public interest matters, by demonstrating from which of the two communities the station would provide service to a greater area and population within the urbanized area.

17. Entravision and M&M, as well as Educational Media Foundation and the Kent Frandsen Radio Companies (filing a joint petition), also sought changes in the categories of cases subject to the new procedures. In the Second R&O, the Commission stated that the new procedures would apply to all pending applications and allotment rulemaking proceedings, with two exceptions. The first was AM Auction 84 applications, which were filed in 2004 and the majority of which have been processed under the prior procedures. The second was “any non-final FM allotment proceeding, including `hybrid' coordinated application/allotment proceedings, in which the Commission has modified a radio station license or granted a construction permit.” 26 FCC Rcd at 2576. M&M argued that the same equities articulated to exempt these two categories should apply equally to pending community of license change applications, especially those in which other stations were required to make facility modifications. It contended that the decision to apply the new procedures to pending community of license change applications was arbitrary and capricious because “similarly situated” new AM applications and FM allotment proceedings were not treated in the same way. Entravision suggested that the Commission apply the prior procedures to any case in which there had been an “initial decision” as of March 2, 2011, the day before release of the Second R&O, even if the action was not final (i.e., if there is a pending petition for reconsideration or application for review).

18. The Commission questioned whether applicants proposing community of license modification were “similarly situated” to the two classes of applicants, permittees, and licensees that were exempted from the new policy. AM Auction 84 filing window applicants were required to file their applications during a filing window, in January 2004, that antedated the Notice of Proposed Rule Making in this proceeding (FCC 09-30, 74 FR 22498 (May 13, 2009), 24 FCC Rcd 5239 (2009)) (Rural NPRM) by over five years. Those applicants therefore had no reason to expect that their applications would be evaluated under a new section 307(b) standard. The Commission recognized, however, that the same equities apply to those few pending community of license change applicants, and petitioners seeking to amend the FM Table of Allotments, that filed their applications or rulemaking petitions before release of the Rural NPRM. Thus, on reconsideration the Commission determined that the new procedures should not apply to (1) applications for minor modification of a station to specify a new community of license filed before April 20, 2009, the release date of the Rural NPRM; or (2) FM allotment proceedings where the petition for rulemaking had been filed, and the rulemaking proceeding thus initiated, prior to the release date of the Rural NPRM.

19. Entravision, in its Petition, stated that the Commission did not “precisely answer the question” as to those cases to which the new section 307(b) procedures would apply. Both Entravision and M&M suggested that the Commission draw a “bright line” as of the Second R&O's release date, to clarify the cases to which the new rules apply. Entravision stated that the prior section 307(b) procedures should apply in any instance in which the Commission had rendered a decision as of March 2, 2011, even if there was still a petition for reconsideration or application for review pending, as an equitable solution to keep parties from having to expend further time and resources revising their section 307(b) showings after having already obtained a favorable result from the Commission under pre-Second R&O procedures. M&M requested that the Commission only apply the new procedures to community of license change applications filed after release of the Second R&O.

20. The Commission disagreed that it was unclear, in the Second R&O, as to when the new procedures would apply, and further disagreed with M&M that all pending community of license change applications were “similarly situated” to the categories of cases the Commission exempted from the new procedures. The majority of pending community of license change applications were filed after release of the Rural NPRM, and thus were on notice that the procedures could change while their applications were pending. While the Commission further carved out a limited exception to the new procedures in FM allotment and hybrid proceedings where licenses were modified or construction permits granted, to the extent that similar equities may exist in the case of certain pending community of license change applications, it stated it would entertain requests for waiver of the revised procedures on a case-by-case basis. The Commission rejected M&M's attempt to analogize those pending community of license change applications without such equities, however, and thus M&M's request to apply the prior procedures to all such applications pending as of release of the Second R&O.

21. The Commission was more persuaded by Entravision's equitable argument to reconsider its application of the new policies. It envisioned situations in which, for example, two applications for change of community of license were granted on the same day, but one would become final under the pre-Second R&O procedures while the other would be subject to the new procedures merely because of a factor beyond the applicant's control, i.e., the filing of a petition for reconsideration or application for review of the application grant. The Commission found no principled reason to apply different procedures to such otherwise similarly situated applications, especially where any applicant facing reconsideration or review would have to go to the additional expense of revising its (previously successful) section 307(b) showing, above and beyond the expense of rebutting a reconsideration petition. On reconsideration, the Commission thus revised its previous determination as to the application of the new procedures. In addition to those categories of applications and rulemaking proceedings listed in paragraph 21 of the Order, and in the Second R&O (26 FCC Rcd at 2575-76), the Commission held that the revised section 307(b) procedures shall not apply to any pending community of license change application or FM allotment proceeding in which a decision on the application, or allotment Report and Order, was released prior to March 3, 2011, the release date of the Second R&O. The Commission therefore granted the Entravision Petition to the extent set forth in the Order, and denied the M&M Petition.

22. Because no new rules are being adopted by the Commission in the Order, but merely clarifications of methodology and applicability of rules previously adopted, the Commission will not send a copy of the Order to Congress under the Congressional Review Act. See 5 U.S.C. 801(a)(1)(A).

23. Accordingly, it is ordered, pursuant to the authority contained in sections 1, 2, 4(i), 303, 307, and 309(j) of the Communications Act of 1934, 47 U.S.C. 151, 152, 154(i), 303, 307, and 309(j), that this Second Order on Reconsideration is adopted .

24. It is further ordered that the Petition for Reconsideration & Comments Regarding the Following Matter, filed by Anthony V. Bono, Friendship Broadcasting, LLC; the Petition for Partial Reconsideration, filed by William B. Clay; the Petition for Partial Reconsideration, filed by M&M Broadcasters, Ltd.; and the Petition for Reconsideration, filed by Educational Media Foundation and the Kent Frandsen Radio Companies, are denied. It is further ordered that the Petition for Reconsideration and/or Clarification, filed by Entravision Communications Corporation; and the Petition for Partial Reconsideration, filed by Radio One, Inc., et al., are granted in part and denied in part .

Regulations governing the NE multispecies fishery are found at 50 CFR part 648, subpart F. Beginning in fishing year (FY) 2012 (May 1, 2012—April 30, 2013), the common pool's sub-annual catch limit (ACL) for each stock is apportioned into trimester TACs (Trimester 1 May 1—August 31; Trimester 2 September 1—December 31; and Trimester 3 January 1—April 30). The regulations at § 648.82(n) require the Regional Administrator to close the Trimester TAC Area for a stock when available information supports a determination that 90 percent of the Trimester TAC is projected to be caught. The Trimester TAC Area for a stock will close to all common pool vessels fishing with gear capable of catching that stock for the remainder of the trimester. Any overages of a trimester TAC will be deducted from Trimester 3, and any overages of the common pool's sub-ACL at the end of the FY will be deducted from the common pool's sub-ACL the following FY. Any uncaught portion of the Trimester 1 and Trimester 2 TAC will be carried over into the next trimester. Any uncaught portion of the common pool's sub-ACL may not be carried over into the following FY.

The FY 2012 common pool sub-ACL for white hake is 26 mt (57,320 lb). The Trimester 2 TAC is 8.1 mt (17,853 lb). Because only a few vessels are responsible for the white hake catch, it was difficult to project when 90 percent of the Trimester TAC would be reached. Therefore, NMFS has monitored the white hake catch very closely to determine when 90 percent was exceeded. Based on the best available data, which includes vessel trip reports (VTRs), dealer reported landings, and vessel monitoring system (VMS) information, NMFS has projected that 90 percent of the Trimester 2 TAC for white hake was harvested on November 26, 2012. Therefore, effective December 5, 2012, the White Hake Trimester TAC Area is closed for the remainder of Trimester 2, through December 31, 2012, to all common pool vessels fishing with trawl gear, sink gillnet gear, and longline/hook gear. The White Hake Trimester TAC Area will reopen to common pool vessels fishing with trawl, sink gillnet, and longline/hook gear at the beginning of Trimester 3, at 0001 hours, January 1, 2013.

This action is required by 50 CFR part 648, and is exempt from review under Executive Order 12866.

The Assistant Administrator for Fisheries, NOAA (AA), finds good cause pursuant to 5 U.S.C. 553(b)(B) to waive prior notice and the opportunity for public comment because it would be impracticable and contrary to the public interest. This action closes the White Hake Trimester TAC Area for common pool vessels fishing with trawl gear, sink gillnet gear, or longline/hook gear through December 31, 2012. The regulations at § 648.82 require this action to ensure that the common pool fishery does not exceed its catch limits for white hake in FY 2012. The catch data indicating that 90 percent of the Trimester 2 TAC for white hake has been caught only recently became available. If implementation of this closure is delayed to solicit prior public comment, the white hake Trimester 2 TAC could be exceeded, thereby undermining the conservation objectives of the Fishery Management Plan. Any overage of the Trimester 2 TAC must be deducted from the Trimester 3 TAC, and any overage of the total sub-ACL in FY 2012 must be deducted from the FY 2013 sub-ACL. This would have adverse economic consequences on common pool vessels. The AA further finds, pursuant to 5 U.S.C. 553(d)(3), good cause to waive the 30-day delayed effectiveness period for the reasons stated above.

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

The 2012 Pacific cod total allowable catch (TAC) specified for catcher vessels greater than or equal to 60 feet length overall (LOA) using pot gear in the BSAI is 19,509 metric tons (mt) as established by the final 2012 and 2013 harvest specifications for groundfish in the BSAI (77 FR 10669, February 23, 2012). The Regional Administrator has determined that catcher vessels greater than or equal to 60 feet LOA using pot gear will not be able to harvest 6,300 mt of the 2012 Pacific cod TAC allocated to those vessels under § 679.20(a)(7)(ii)(A)( 5 ). In accordance with § 679.20(a)(7)(iii) and taking into account the capabilities of the sectors to harvest reallocated amounts of Pacific cod, the Regional Administrator has also determined that this unharvested amount is unlikely to be entirely harvested through the reallocation hierarchy set forth in § 679.20(a)(7)(iii)(A). Therefore, following the reallocation hierarchies set forth in both § 679.20(a)(7)(iii)(A) and § 679.20(a)(7)(iii)(C), NMFS reallocates 500 mt to catcher vessels less than 60 ft. LOA using hook-and-line or pot gear, 800 mt to pot catcher/processors, and 5,000 mt to hook-and-line catcher/processors. 1

The harvest specifications for Pacific cod included in the final 2012 harvest specifications for groundfish in the BSAI (77 FR 10669, February 23, 2012) and inseason adjustment (77 FR 53152, August 31, 2012) are revised as follows: 118,106 mt for hook-and-line catcher/processors, 4,284 mt for pot catcher/processors, 8,880 mt for catcher vessels less than 60 ft. LOA using hook-and-line or pot gear, and 13,209 mt for catcher vessels greater than or equal to 60 ft. LOA using pot gear.

This action responds to the best available information recently obtained from the fishery. The Assistant Administrator for Fisheries, NOAA (AA), finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such requirement is impracticable and contrary to the public interest. This requirement is impracticable and contrary to the public interest as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay the reallocation of Pacific cod specified for the Pacific cod sectors affected by this action. Since the fishery is currently open, it is important to immediately inform the industry as to the revised allocations. Immediate notification is necessary to allow for the orderly conduct and efficient operation of this fishery, to allow the industry to plan for the fishing season, and to avoid potential disruption to the fishing fleet as well as processors. NMFS was unable to publish a notice providing time for public comment because the most recent, relevant data only became available as of November 29, 2012.

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

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