The FAA issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 by adding an AD that would apply to all PW PW1519G, PW1521G, PW1521GA, PW1524G, PW1525G, PW1521G-3, PW1524G-3, PW1525G-3, PW1919G, PW1921G, PW1922G, PW1923G, and PW1923G-A model turbofan engines. The NPRM published in the Federal Register on May 31, 2019 (84 FR 25203). The NPRM was prompted by corrosion found on the HPC front hub, which could result in certain HPC front hubs cracking before reaching their published life limit. The NPRM proposed to require revisions to the ALS of the manufacturer's ICA and air carrier's approved CAMP to incorporate new or more restrictive airworthiness limitations. The FAA is issuing this AD to address the unsafe condition on these products.

The FAA gave the public the opportunity to participate in developing this final rule. The FAA received no comments on the NPRM or on the determination of the cost to the public.

The FAA reviewed the relevant data and determined that air safety and the public interest require adopting this final rule as proposed except for minor editorial changes. The FAA has determined that these minor changes:

• Are consistent with the intent that was proposed in the NPRM for addressing the unsafe condition; and

• Do not add any additional burden upon the public than was already proposed in the NPRM.

The FAA reviewed PW Service Bulletin (SB) PW1000G-A-72-00-0109-00A-930A-D, Issue No. 001, dated April 2, 2019 (“PW SB PW1000G-A-72-00-0109-00A-930A-D”), and PW SB PW1000G-A-72-00-0058-00B-930A-D, Issue No. 002, dated May 10, 2019 (“PW SB PW1000G-A-72-00-0058-00B-930A-D”). PW SB PW1000G-A-72-00-0109-00A-930A-D describes the revised maximum cycle limits of the HPC front hub for PW PW1500G engines. PW SB PW1000G-A-72-00-0058-00B-930A-D describes the revised maximum cycle limits of the HPC front hub for PW PW1900 engines. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

The FAA estimates that this AD affects 18 engines installed on airplanes of U.S. registry.

The FAA estimates the following costs to comply with this AD:

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

The FAA is 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 is issued in accordance with authority delegated by the Executive Director, Aircraft Certification Service, as authorized by FAA Order 8000.51C. In accordance with that order, issuance of ADs is normally a function of the Compliance and Airworthiness Division, but during this transition period, the Executive Director has delegated the authority to issue ADs applicable to engines, propellers, and associated appliances to the Manager, Engine and Propeller Standards Branch, Policy and Innovation Division.

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) Will not affect intrastate aviation in Alaska, and

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

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

The FAA issued AD 2018-25-01, Amendment 39-19511 (83 FR 62694, December 6, 2018), (“AD 2018-25-01”), for all RR Trent 1000-A, Trent 1000-C, Trent 1000-D, Trent 1000-E, Trent 1000-G, and Trent 1000-H turbofan engine models. AD 2018-25-01 required initial inspections and repetitive inspections of the IPC R1 blades, IPC R2 blades, and IPC shaft stage 2 dovetail posts, and removal of any cracked parts from service. AD 2018-25-01 resulted from the manufacturer determining the need for repetitive inspections of the IPC R1 blades, IPC R2 blades, and IPC shaft stage 2 dovetail posts. The FAA issued AD 2018-25-01 to prevent failure of the IPC, which could result in failure of one or more engines, loss of thrust control, and loss of the airplane.

Since the FAA issued AD 2018-25-01, RR determined that inspection intervals for certain affected engines need to be revised. Also, since the FAA issued AD 2018-25-01, the European Union Aviation Safety Agency (EASA) has issued EASA AD 2019-0075, dated March 29, 2019 (“the MCAI”), which requires initial and repetitive inspections of IPC R1 blades, IPC R2 blades, and IPC shaft stage 2 dovetail posts installed on certain engines and removal of any cracked parts from service.

Also, since the FAA issued AD 2018-25-01, the type certificate (TC) for all Trent 1000 turbofan model engines was revised to add RR Trent 1000-AE2 and Trent 1000-CE2 engine models to the list of applicable engine models. Both Trent 1000-AE2 and Trent 1000-CE2 engine models were identified in EASA AD 2019-0075 and are subject to the same unsafe condition as the other models listed in the Applicability of this AD.

In addition, Rolls-Royce plc transferred TC E00076EN to Rolls-Royce Deutschland Ltd & Co KG (RRD) on February 21, 2019. The FAA has therefore revised the TC holder name from “Rolls-Royce plc” in AD 2018-25-01 to “Rolls-Royce Deutschland Ltd & Co KG” in this AD. Where applicable, for example when referring to the relevant service information, the FAA continues to use the name “Rolls-Royce plc” in this AD.

The FAA also updated our estimate for labor hours when replacing the IPC blades and the IPC drum to be consistent with the estimates provided in the service information.

The FAA is issuing this AD to address the unsafe condition on these products.

The FAA reviewed RR Alert Non-Modification Service Bulletin (NMSB) Trent 1000 72-AK130, Revision 4, dated March 4, 2019, and RR NMSB Trent 1000 72-K132, Revision 2, dated March 26, 2019. RR Alert NMSB Trent 1000 72-AK130 describes procedures for performing initial and repetitive inspections of the IPC R1 blades, IPC R2 blades, and IPC shaft stage 2 dovetail posts, and lists engine serial numbers. RR NMSB Trent 1000 72-K132, describes procedures for replacement of the IPC R1 blades, IPC R2 blades, and the IP compressor drum during refurbishment. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

The FAA reviewed RR NMSB Trent 1000 72-K099, Revision 2, dated September 27, 2018, and earlier revisions; RR NMSB Trent 1000 72-K100, Initial Issue, dated June 11, 2018; RR NMSB Trent 1000 72-K129, Initial Issue, dated June 11, 2018; and RR NMSB Trent 1000 72-K129, Revision 3, dated February 28, 2019, and earlier revisions. RR NMSB Trent 1000 72-K099, Initial Issue, and RR NMSB Trent 1000 72-K099, Revision 2, and earlier revisions, describe procedure for an ultrasonic inspection of the IPC R1 blades. RR NMSB Trent 1000 72-K100, Initial Issue, describes procedures for a visual borescope inspection of the IPC R2 blades and IPC shaft stage 2 dovetail posts. RR NMSB Trent 1000 72-K129, Revision 3, and earlier revisions, describe procedures for an ultrasonic inspection of the IPC R2 blades.

This product has been approved by EASA and is approved for operation in the United States. Pursuant to our bilateral agreement with the European Community, EASA has notified us of the unsafe condition described in EASA AD 2019-0075, dated March 29, 2019, and service information referenced above. The FAA is issuing this AD because we evaluated all the relevant information provided by EASA and determined the unsafe condition described previously is likely to exist or develop in other products of the same type design.

This AD requires initial and repetitive inspections of the IPC R1 blades, IPC R2 blades, and IPC shaft stage 2 dovetail posts, and removal of any cracked parts from service.

This AD requires inspections of any affected IPC part to be completed within 15 days of the effective date of this AD. EASA AD 2019-0075, dated March 29, 2019, requires inspection of certain affected IPC parts to be completed within 30 days of the effective date of EASA AD 2019-0075. The FAA expects most operators have already complied with EASA AD and find that completing the inspections within 15 days of the effective date of this AD provides an appropriate level of safety.

The FAA considers this AD interim action. The manufacturer is still reviewing this unsafe condition and may develop follow-on actions.

No domestic operators use this product. Therefore, the FAA finds that notice and opportunity for prior public comment are unnecessary 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 the FAA did not provide you with notice and an opportunity to provide your comments before it becomes effective. However, the FAA invites you to send any written data, views, or arguments about this final rule. Send your comments to an address listed under the ADDRESSES section. Include the docket number FAA-2019-0528 and product identifier 2018-NE-24-AD at the beginning of your comments. The FAA specifically invites comments on the overall regulatory, economic, environmental, and energy aspects of this final rule. The FAA will consider all comments received by the closing date and may amend this final rule because of those comments.

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

The requirements of the Regulatory Flexibility Act (RFA) do not apply when an agency finds good cause pursuant to 5 U.S.C. 553 to adopt a rule without prior notice and comment. Because the FAA has determined that it has good cause to adopt this rule without notice and comment, RFA analysis is not required.

The FAA estimates that this AD affects 0 engines installed on airplanes of U.S. registry.

The FAA estimates the following costs to comply with this AD:

The FAA estimates the following costs to do any necessary replacements that would be required based on the results of the inspection. The FAA has no way of determining the number of aircraft that might need these replacements:

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.

The FAA is 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 is issued in accordance with authority delegated by the Executive Director, Aircraft Certification Service, as authorized by FAA Order 8000.51C. In accordance with that order, issuance of ADs is normally a function of the Compliance and Airworthiness Division, but during this transition period, the Executive Director has delegated the authority to issue ADs applicable to engines, propellers, and associated appliances to the Manager, Engine and Propeller Standards Branch, Policy and Innovation Division.

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, and

(2) Will not affect intrastate aviation in Alaska.

Accordingly, under the authority delegated to me by the Administrator, the FAA amends part 39 of the Federal Aviation Regulations (14 CFR part 39) as follows:

To comply with the Do-Not-Call Registry Fee Extension Act of 2007 (Pub. L. 110-188, 122 Stat. 635) (“Act”), the Commission is amending the TSR by updating the fees entities are charged for accessing the Registry as follows: The revised rule increases the annual fee for access to the Registry for each area code of data from $63 to $65 per area code; and increases the maximum amount that will be charged to any single entity for accessing area codes of data from $17,406 to $17,765. Entities may add area codes during the second six months of their annual subscription period, and the fee for those additional area codes of data remains $32.

These increases are in accordance with the Act, which specifies that beginning after fiscal year 2009, the dollar amounts charged shall be increased by an amount equal to the amounts specified in the Act, multiplied by the percentage (if any) by which the average of the monthly consumer price index (for all urban consumers published by the Department of Labor) (“CPI”) for the most recently ended 12-month period ending on June 30 exceeds the CPI for the 12-month period ending June 30, 2008. The Act also states that any increase shall be rounded to the nearest dollar and that there shall be no increase in the dollar amounts if the change in the CPI since the last fee increase is less than one percent. For fiscal year 2009, the Act specified that the original annual fee for access to the Registry for each area code of data was $54 per area code, or $27 per area code of data during the second six months of an entity's annual subscription period, and that the maximum amount that would be charged to any single entity for accessing area codes of data would be $14,850.

The determination whether a fee change is required and the amount of the fee change involves a two-step process. First, to determine whether a fee change is required, we measure the change in the CPI from the time of the previous increase in fees. There was an increase in the fees for fiscal year 2019. Accordingly, we calculated the change in the CPI since last year, and the increase was 2.07 percent. Because this change is over the one percent threshold, the fees will change for fiscal year 2020.

Second, to determine how much the fees should increase this fiscal year, we use the calculation specified by the Act set forth above: The percentage change in the baseline CPI applied to the original fees for fiscal year 2009. The average value of the CPI for July 1, 2007 to June 30, 2008 was 211.702; the average value for July 1, 2018 to June 30, 2019 was 253.268, an increase of 19.63 percent. Applying the 19.63 percent increase to the base amount from fiscal year 2009, leads to a $65 fee for access to a single area code of data for a full year for fiscal year 2020, an increase of $2 from last year. The actual amount is $64.60, but when rounded, pursuant to the Act, $65 is the appropriate fee. The fee for accessing an additional area code for a half year remains $32 (rounded from $32.30). The maximum amount charged increases to $17,765 (rounded from $17,765.06).

Administrative Procedure Act; Regulatory Flexibility Act; Paperwork Reduction Act. The revisions to the Fee Rule are technical in nature and merely incorporate statutory changes to the TSR. These statutory changes have been adopted without change or interpretation, making public comment unnecessary. Therefore, the Commission has determined that the notice and comment requirements of the Administrative Procedure Act do not apply. See 5 U.S.C. 553(b). For this reason, the requirements of the Regulatory Flexibility Act also do not apply. See 5 U.S.C. 603, 604.

Pursuant to the Paperwork Reduction Act, 44 U.S.C. 3501-3521, the Office of Management and Budget (“OMB”) approved the information collection requirements in the Amended TSR and assigned the following existing OMB Control Number: 3084-0169. The amendments outlined in this Final Rule pertain only to the fee provision (§ 310.8) of the Amended TSR and will not establish or alter any record keeping, reporting, or third-party disclosure requirements elsewhere in the Amended TSR.

Accordingly, the Federal Trade Commission amends part 310 of title 16 of the Code of Federal Regulations as follows:

The preamble below is designed to assist readers in understanding this final rule. This preamble provides background information and a regulatory analysis of the rule.

These amendments to the rule are being promulgated in accordance with the Administrative Procedure Act (5 U.S.C. 553) (APA), and will be codified in 19 CFR part 220.

Section 335 of the Tariff Act of 1930 (19 U.S.C. 1335) authorizes the Commission to adopt such reasonable procedures, rules, and regulations as it deems necessary to carry out its functions and duties. In addition, section 3(b)(5) of the American Manufacturing Competitiveness Act of 2016 (19 U.S.C. 1332 note) (the Act) directs the Commission to prescribe and publish, in the Federal Register and on a publicly available internet website of the Commission, procedures to be complied with by members of the public in submitting petitions for duty suspensions and reductions under section 3(b)(1)(A) of the Act.

This rulemaking effort began when the Commission published a document in the Federal Register on December 26, 2018, making final the existing interim rule in part 220 of its Rules of Practice and Procedure governing the submission and consideration of petitions for duty suspensions and reductions under the Act. In that document the Commission stated that it might propose several amendments to the final rule in the near future in light of experience gained in applying the interim rule, with the intent that the amendments be in place before October 15, 2019. See document published in the Federal Register on December 26, 2018 (83 FR 66102), making final the interim rule published in the Federal Register on September 30, 2016 (81 FR 67144).

The Commission published a notice of proposed amendments to part 220 and a request for comments in the Federal Register on March 14, 2019 (84 FR 9273). The amendments modify the text of §§ 220.5, 220.6, 220.7, 220.9, 220.10, and 220.11 of part 220. In addition, these amendments re-designate current §§ 220.11, 220.12, 220.13, and 220.14 as §§ 220.12, 220.13, 220.14, and 220.15, respectively.

The changes principally (1) require petitions and comments to include certain additional information to assist the Commission in evaluating a petition, (2) clarify and provide additional instruction with respect to information to be included in a petition and comment, and (3) revise the requirement regarding the time when a petition may be withdrawn. The changes also divide § 220.11 into two sections, §§ 220.11 and 220.12, and renumber current §§ 220.12 through 220.14.

The document invited members of the public to file written comments on the proposed amendments no later than 30 days after the day of publication of the document, in this case, by April 15, 2019. The Commission received written comments from 13 interested parties: The American Association of Exporters and Importers (AAEI); the American Chemistry Council (ACC); the American Apparel & Footwear Association (AAFA); Ann, Inc. (Ann); Element Electronics (Element); W. L. Gore & Associates, Inc. (W. L. Gore); Mannington Mills, Inc. (Mannington); the Manufacturing Tariff Bill Coalition (MTB Coalition); the National Association of Manufacturers (NAM); Newell Brands, Inc. (Newell); Outdoor Industry Association (Outdoor); PetSmart, Inc. (Petsmart); and Simms Fishing Products, LLC (Simms).

The Commission carefully considered all comments that it received. The Commission provides its response to comments in a section-by-section analysis provided below. The Commission appreciates the time and effort of the commentators in preparing their submissions.

As required by the Regulatory Flexibility Act, the Commission certifies that these amendments will not have a significant impact on small business entities.

Consistent with its ordinary practice, the Commission is making these amendments in accordance with the notice-and-comment rulemaking procedure in section 553 of the APA (5 U.S.C. 553). That procedure entails the following steps: (1) Publication of a notice of proposed rulemaking; (2) solicitation of public comments on the proposed amendments; (3) Commission review of public comments on the proposed amendments, and (4) publication of final amendments at least 30 days prior to their effective date.

The Commission has determined that the proposed amendments to the rules do not meet the criteria described in section 3(f) of Executive Order 12866 (58 FR 51735, October 4, 1993) and thus do not constitute a “significant regulatory action” for purposes of the Executive Order.

The Regulatory Flexibility Act (5 U.S.C. 601 et seq. ) is inapplicable to this rulemaking because it is not one for which a notice of proposed rulemaking is required under 5 U.S.C. 553(b) or any other statute. Although the Commission has chosen to publish a notice of proposed rulemaking, the proposed regulations are “agency rules of procedure and practice,” and thus are exempt from the notice requirement imposed by the APA in 5 U.S.C. 553(b).

The proposed rules do not contain federalism implications warranting the preparation of a federalism summary impact statement pursuant to Executive Order 13132 (64 FR 43255, Aug. 4, 1999).

No actions are necessary under title II of the Unfunded Mandates Reform Act of 1995, Public Law 104-4 (2 U.S.C. 1531-1538) because the proposed amendments to the rules will not result in the expenditure by state, local, and tribal governments, in the aggregate, or by the private sector, of $100,000,000 or more in any one year (adjusted annually for inflation), and will not significantly or uniquely affect small governments, as defined in 5 U.S.C. 601(5).

The proposed rules are not “major rules” as defined by section 251 of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801 et seq. ). Moreover, they are exempt from the reporting requirements of that Act because they contain rules of agency organization, procedure, or practice that do not substantially affect the rights or obligations of non-agency parties.

The Commission previously submitted an information collection request for its secure web portal for the Miscellaneous Tariff Bills Petition System to the Office of Management and Budget for Paperwork Reduction Act clearance. See 81 FR 58531 (Aug. 25, 2016). The Commission received the appropriate clearance. However, this clearance expires on September 30, 2019, and the Commission is seeking a new clearance. The Commission intends to process the information it collects consistent with these rules as amended, and the Commission intends to obtain the appropriate clearance required by the Paperwork Reduction Act before it begins its next information collection on October 15, 2019.

The final regulations contain 3 (three) changes from those proposed in the notice of proposed rulemaking (NPRM). These changes are summarized here.

First, with regard to § 220.6(a)(4), the Commission has determined to retain, rather than delete, the wording in the current rule that requires the article description to be “sufficiently clear as to be administrable by CBP.” The Commission has determined not to adopt the proposed substitute wording.

Second, with regard to § 220.7(b)(2), the Commission has determined to retain, rather than delete, the word “generally”.

Third, with regard to § 220.11(c)(4), the Commission has determined to revise the rule to read “a statement as to whether such product is generally available for sale, and if not, an explanation of its lack of availability for sale”.

Section 220.5 lists the types of information that must be set forth in a petition. The proposed amendment would modify § 220.5 in five respects. First, it amends § 220.5(e)(1) to clarify that the U.S. Customs and Border Protection (CBP) ruling requested should be one that indicates CBP's classification of the article. Second, it divides § 220.5(h) into two parts. New paragraph (h)(1) requires petitions to include an estimate of both total value and, in addition, dutiable value in U.S. dollars for the next 5 calendar years, and new paragraph (h)(2) requires petitions to include an estimate of the share of total imports represented by the petitioner's imports of the subject article. Third, the amendment modifies § 220.5(j) to require that the petition include “[t]he names of any domestic producers of the article, if available.” Fourth, it adds a new paragraph (n) that requires the petition to include a certification that the information supplied in the petition is complete and correct to the best of the petitioner's knowledge and belief and that the petitioner understands that the information submitted is subject to audit and verification by the Commission. Fifth, it re-designates existing paragraph (n) as paragraph (o).

AAEI expressed concern that the amendment to paragraph (h) that requires petitioners to provide estimated total value and dutiable value data in U.S. dollars appears to apply to the specific petitioner, without allowing the petitioner to redact confidential information or provide it in an alternative form, such as in quantified or percentage values. AAEI also expressed concern that the new certification requirement in paragraph (n) would open petitioners to a “quick response audit.”

The ACC expressed similar concerns about the possible disclosure of data relating to an estimate of the share of total imports. It expressed concern that the change, in the absence of a Commission process for considering whether it needs the information for its review, would discourage companies from filing petitions. It recommended that the Commission provide a discrete confidential business information process if the Commission decides such information is necessary for its review of a petition.

The MTB Coalition did not propose any changes to the proposed amendments to § 220.5. It also did not oppose the new requirements. However, the MTB Coalition asked that the Commission be “lenient” when auditing estimates. The MTB Coalition said that petitioners may have only limited knowledge about imports by other importers, particularly when the imported article does not directly correspond to an 8- or 10-digit HTS number. The MTB Coalition also stated that a petitioner may not know the names of domestic producers of the article. If a company does list a domestic producer, the MTB Coalition expressed concern that a petition may be “automatically denied.”

NAM asked that the Commission treat estimates submitted by petitioners of their total share of imports as confidential business information when petitioners so request.

The Commission is adopting as a final rule the amendments to § 220.5. The Commission considered AAEI's concern about requiring that a petition include an estimate of dutiable value data. The Commission notes that it required petitioners to submit such data as part of their 2016 petitions, and thus this change simply incorporates prior Commission practice. The Commission did not encounter difficulties or concerns in collecting such data in 2016. The Commission is aware that disclosure of dutiable value data could help a competitor, in some instances and with the help of other data, gain insight into the dutiable value data reported by a petitioner. When a petitioner has reason to believe this may occur, the petitioner may request confidential treatment for the information it considers to qualify for such treatment.

The Commission considered the concerns expressed by ACC and NAM about possible disclosure of a petitioner's data relating to an estimate of the share of total imports. As in the preceding paragraph, the Commission notes that a petitioner may seek confidential treatment for business information that it believes qualifies for such treatment. However, the Commission also notes that sections 3(b)(C) and (D) of the Act, which set out the content requirements for the Commission's preliminary and final reports to the Committees, require the Commission to provide an estimate of the amount of revenue loss to the United States if a duty suspension or reduction takes effect. For this and certain other information the Commission requires be included in a petition, the Commission has notified petitioners, in accordance with the confidential treatment provision in section 332(g) of the Tariff Act of 1930, that certain specific information provided may be disclosed in the reports it sends to the Committees.

The Commission appreciates the concerns expressed by the MTB Coalition. The Commission notes it has already prefaced several of the petitioning requirements at issue in current § 220.5 with the term “if available.” The Commission also notes that it permits petitioners to provide additional explanation regarding any domestic production and considers all available information obtained with respect to each petition in preparing its final report and recommendation.

Section 220.6 describes the information that should be included in the description of the article for which a duty suspension or reduction is being sought. The amendment would delete wording in § 220.6(a)(4) that requires that the description be “sufficiently clear as to be administrable by CBP.” The Commission would substitute more specific wording that requires the petition (1) to describe the article based on the existing Harmonized Tariff Schedule (HTS) category's description (at the 8- or 10-digit level) in HTS chapters 1 through 97, or (2) to delineate an article representing a subset of the coverage of the applicable HTS category using terminology already included in the HTS or interpreted in pertinent CBP rulings.

ACC opposed the change and said that the current “administrable” wording “strikes the right balance.” ACC indicated that the proposed wording would introduce “unnecessary complexities,” make the rules “too stringent,” and might discourage the filing of petitions.

Element opposed deletion of the wording “sufficiently clear as to be administrable by CBP” in the current rule and replacement with wording that would require a petitioner to describe the imported article in terms of existing 8-digit HTS subheadings or 10-digit HTS statistical reporting numbers. Element cited four reasons: (1) The terminology in the HTS is frequently out of date; (2) existing 8-digit and 10-digit HTS numbers often cover a range of products, and more detailed descriptions may be necessary to address potential concerns of or objections from producers of other similar products that fall within that tariff line; (3) “other” categories offer little in the way of description that could be used to narrow the scope of an MTB; and (4), even where HTS subheadings are further broken down into statistical reporting numbers that describe an article with some specificity, such descriptions may still be too broad and require further narrowing. Element urged the Commission to amend the proposed rule change to make clear that petitioners should draft article descriptions using the existing terminology of the HTS, and allow petitioners to rely on examples of terminology found “anywhere” within the HTS.

The MTB Coalition expressed the view that this change will be helpful in the drafting of article descriptions and expressed the hope it will lead to fewer CBP objections over administrability issues.

NAM urged that the Commission continue to use the “sufficiently clear” wording in the current rule. NAM expressed the view that the proposed substitute wording “is far too narrow and not required by the statutes.”

After considering the comments submitted, the Commission has decided to withdraw this proposed change. The Commission did not encounter difficulties during the first round of petitions with the current wording. It proposed the revised wording in the expectation it would provide greater clarity and help petitioners in preparing their petitions.

Section 220.7 describes what constitutes a properly filed petition and describes how the Commission will treat identical and overlapping petitions filed by the same petitioner. The Commission proposes to make two changes to this section. First, it proposes to expand the title of the rule section to indicate that the rule also applies to identical and overlapping petitions filed by the same petitioner. Second, it proposes to amend § 220.7(b)(2) to delete the word “generally.” Section 220.7(b)(2) currently states that when a petitioner has filed one or more identical or overlapping petitions, the Commission will “generally” consider the earliest filed pending petition to be the petition of record, leaving open the possibility that the Commission might consider a different petition for another reason. In the few instances in which the Commission received a petition that fell into this category during the 2016 filing period, the Commission considered the earliest filed petition to be the petition of record. This change removes any uncertainty.

ACC requested that the Commission retain the term “generally” in order to retain the flexibility to permit petitioners to correct improperly filed or overlapping petitions.

AAFA said that the changes regarding overlapping petitions would make the current situation worse. It urged the Commission to provide petitioners with the opportunity to explain how multiple petitions might not be overlapping. It also asserted that the Commission, during the 2017 petition cycle, had applied the rule too narrowly and had rejected petitions that met the statutory requirements.

NAM expressed the view that the proposed revisions regarding overlapping petitions filed by the same petitioner fail to address the concern raised by manufacturers during the 2016-2017 cycle that resulted in the rejection of petitions. NAM asserted that the Commission applied an overly narrow construction of its own rules in rejecting petitions, and it urged the Commission to revise § 220.7 “to establish an opportunity or procedure for petitioners to explain how multiple petitions submitted by the same petitioner may not, in fact, be overlapping petitions.”

The Commission is adopting the first of the two proposed changes to this section, the change in the title of the section. However, in consideration of comments favoring retention of the term “generally,” the Commission is withdrawing that proposed change.

Section 220.9 addresses withdrawal of petitions, submission of new petitions, and amendments to petitions. The Commission proposes to amend § 220.9(a), which currently states that a petitioner may withdraw a petition at any time prior to the time the Commission transmits its final report to Congress. The Commission proposes to revise this paragraph to state that a petitioner may withdraw a petition “no later than 30 days after the Commission submits its preliminary report.”

The MTB Coalition expressed the view that this change will help the consideration process to be more efficient.

In the absence of any adverse comments, the Commission is adopting as a final rule the amendments to § 220.9.

Current § 220.10 addresses Commission publication and public availability of petitions and opportunity for the public to comment on such petitions. The Commission proposes to divide § 220.10 into two separate sections, with § 220.10 retitled “Commission publication and public availability of petitions,” and new § 220.11 titled “Public comment period.” Revised § 220.10 tracks the text of current § 220.10(a). The Commission proposes to delete the title of paragraph (a) of current § 220.10 and incorporate it into the new title of § 220.10.

The Commission did not receive any comments.

The Commission is adopting as a final rule the amendments to § 220.10.

New § 220.11, titled as “Public comment period,” contains four paragraphs. New paragraph (a), “Time for filing,” largely tracks the wording in current § 220.10(b). New paragraph (b) includes a list of information items that must be included in a comment, including certain information about the commenter; a statement about whether the comment supports, opposes, or takes no position on the petition; and a certification statement. It also refers commenters to the Commission's Handbook on MTB Filing Procedures for further information. New paragraph (c) sets out a list of requirements that apply to comments from domestic producers. Comments must include: (1) A description of the product alleged to be identical, like, or directly competitive with the product that is the subject of the petition; (2) the Chemical Abstracts Services registry number (if any); (3) certain information about production or likely production of an identical, like, or directly competitive article within the United States; (4) a statement as to whether such product is commercially available and, if not commercially available, an explanation of its lack of availability; (5) addresses for the locations of U.S. production facilities; and (6) evidence demonstrating the existence of domestic production and citing possible examples. Paragraph (d) states that the Commission may provide additional opportunity for public comment and, if it does so, will publish notice of that opportunity in the Federal Register .

AAEI expressed support for the requirement that persons filing comments indicate whether they support, oppose, or take no position on the petition. It also expressed concern that the required submission of additional information without the opportunity to redact may require persons filing comments to disclose confidential business information.

AAFA expressed support for the inclusion of new paragraph (d) and, in addition, asked that the Commission establish a specific public comment period for the report of the U.S. Department of Commerce relating to whether there is domestic production of a like or directly competitive article and whether a domestic producer objects. AAFA expressed the view that the Commission rejected petitions during the prior cycle based on insufficient confidential opposition.

Ann asked that the Commission amend proposed § 220.11(c)(1) to require that domestic producers include more detailed information about the domestic article. Ann asked that the Commission require producers to include the HTS code for the article and, if the producer exports the article, the Schedule B code, and to include information regarding the intrinsic characteristics of the article, including materials from which made, appearance, size and weight, quality, texture, and use. Ann asked that the Commission modify proposed § 220.11(c)(3) and (5) to include additional questions about the process at domestic facilities and for evidence of machinery and production capacity. With regard to § 220.11(c)(4), Ann expressed concern that the term “commercially available” was undefined and asked that the Commission require domestic producers to provide additional details, including quantity produced, the names of purchasers and how the article is distributed, and the retail price.

W.L. Gore, Outdoor, and PetSmart asked the Commission to make revisions to proposed § 220.11(c) that are similar in scope to those requested by Ann.

The MTB Coalition expressed the view that the new requirements will add more transparency to the process and encouraged the U.S. Department of Commerce to adopt a similar mechanism to increase transparency across all agencies reviewing petitions. With respect to new § 220.11(d), the MTB Coalition stated that it found the additional comment period to be helpful in the 2017 petition cycle, and it recommended incorporating the proposed change and opening it to comments on petitions falling in categories III, IV, V, and VI.

NAM similarly expressed support for an additional public comment period. It also asked that a public comment period be established following the publication of the Commission's preliminary report, and that the public be permitted to comment during that period on petitions the Commission does not recommend for inclusion (Category VI petitions), including petitions opposed by the U.S. Department of Commerce. NAM also asked that the public also be able to comment on petitions that the Commission has determined do not contain required information or for which the Commission determined that the petition is not a likely beneficiary (Category V petitions).

Newell Brands asked the Commission to make revisions to proposed § 220.11(c) that are similar to those requested by Ann, W.L. Gore, Outdoor, and PetSmart. Newell also asked that the Commission eliminate, to the extent possible, the subjective analysis conducted by the Commission and Commerce for the evaluation of domestic availability and production of an identical, like or directly competitive product. Newell stated that the term “domestic production” is ambiguous, and that a good produced in a country with which the United States has a free trade agreement and which enters the United States duty-free should not be considered “domestic production.” Newell also said that repackaging and making minor modifications in the United States that result in a change in classification should not qualify as domestic production for purposes of the Act.

After taking into consideration the comments received, the Commission is adopting as a final rule the amendments to § 220.11, with one exception: The Commission has redrafted § 220.11(c)(4). In the Commission's view, the amendments strike the right balance. First, they take into account the need to provide additional opportunity for public comment and at the same time allow the Commission to prepare and transmit its preliminary and final reports in the time allowed under the statute. Second, they help to address the need for some additional information from domestic producers without placing an undue additional burden on interested parties that are not petitioners or, in most cases, beneficiaries of duty suspensions and reductions sought.

With regard to AAEI's concern about the opportunity to redact confidential business information in its written comments, the Commission notes that interested parties may seek confidential treatment of business information submitted in response to § 220.11(c)(6).

To address Ann's concern regarding use of the term “commercially available,” the Commission has redrafted § 220.11(c)(4) to read “a statement as to whether such product is generally available for sale and, if not, an explanation of its lack of availability for sale.” The Commission is seeking this and other relevant information in determining whether there is domestic production of a product.

The Commission also considered the comments submitted by the MTB Coalition and NAM in support of an additional public comment period and in support of providing opportunity to consider petitions that fall in other categories. The rules, as amended, allow for the possibility of an additional comment period. Should the Commission choose to provide an additional comment period, it will publish a notice in the Federal Register that sets out specific details and instructions.

The Commission also considered Newell's view that the term “domestic production” is “ambiguous” and Newell's view that the term might include goods produced in a free-trade-agreement partner or goods that are merely repackaged or slightly modified. In response, the Commission notes that the term “domestic production” is defined in both the statute (in section 7(5) of the Act) and Commission § 220.2(h) to mean the domestic production of an article that is identical to, or like or directly competitive with, an article to which a petition for a duty suspension or reduction would apply, for which a domestic producer has demonstrated production, or imminent production, in the United States. The Commission also defined the terms “identical,” “like” and “directly competitive” in § 220.2(h), and for the terms “like” and “directly competitive” used definitions in the legislative history of the Trade Act of 1974. The decision as to whether a good is an import or a domestically produced good ultimately depends on the facts, and the Commission considers all available information obtained with respect to each petition in preparing its final report and recommendation.

The Commission proposes to re-designate current § 220.11 as § 220.12. The section describes the contents of the Commission's preliminary report to the Committees. The Commission proposes only one change: It would delete the parenthetical in paragraph (b)(2) that relates to corrections of article descriptions.

Ann proposed that the Commission amend renumbered § 220.12(a)(3) to require that the Commission take into account the joint report of the Secretary of Commerce and Customs and Border Protection. If the report provides no suggested changes and the description is found not administrable, Ann asked that petitioners be given an opportunity to work with CBP to make technical changes to the article description.

W.L. Gore, Newell, Outdoor, PetSmart, and Simms, asked the Commission to make revisions to proposed § 220.12(a)(3) that are similar in scope to those requested by Ann.

In the absence of comments to the contrary, the Commission will delete the parenthetical in paragraph (b)(2) as proposed in its notice of proposed rulemaking. With regard to the modifications to § 220.12(a)(3) proposed by several interested parties, the Commission notes that it did not propose or provide notice to the public of such modifications. Accordingly, the Commission will not include the requested amendment. Moreover, the degree to which CBP chooses to work with petitioners is a matter for CBP to decide; the Commission has no authority to direct CBP to work with individual petitioners.

The Commission is re-designating current §§ 220.12, 220.13, and 220.14 as §§ 220.13, 220.14, and 220.15, respectively, to reflect the division of § 220.10 into two sections. The Commission received no comments on this renumbering. The Commission is not making any other changes to these sections, and is adopting the new numbering as proposed.

Several persons submitting comments addressed matters that go beyond the proposed changes to part 220 and the Commission's notice of proposed rulemaking. For example, Mannington Mills, Inc., of Salem N.J., raised the matter of an earlier effort to persuade the Commission to include a limited number of reliquidations in its 2017 MTB report to the Committees. Mannington asserts that the Commission decided against this “based on incorrect and, in our opinion, false, information provided to it by Customs.” Mannington asked that this issue be remedied and addressed in the Commission's new rules.

NAM expressed concern that the Commission's proposed revisions do not address other issues raised by petitioners during the 2016-2017 cycle. NAM cited two examples: (1) “unsubstantiated opposition” to the petition, such as opposition from companies that do not produce articles classified in the same HTS heading as those produced by the petitioner, or general information on production of overly broad categories without evidence that domestic producers meet the technical requirements needed by petitioning companies; and (2) the inability of stakeholders to engage directly with U.S. Customs and Border Protection (CBP). The Association did not propose any specific amendments to the rules to address its concerns. The AAFA made similar points.

Newell, Outdoor, and Simms proposed two modifications to § 220.14(b). The first would amend § 220.14 by adding a new paragraph (b)(3) to require that the identity of domestic producers opposing petitions through the U.S. Department of Commerce process be provided to petitioners before the Commission makes its final conclusions and publishes its final report. The second would amend § 220.14 to add a new paragraph (b)(4) to require that domestic producers who express opposition towards any petitions after publication of the final Commission report, and who did not participate in the public comment process, must provide all information required by § 220.11(c) and be evaluated by the Commission and Commerce in order to be considered.

The matter raised by Mannington goes beyond the scope of the Commission's notice of proposed rulemaking and beyond the Commission's authority under the statute. With regard to the comments of NAM, there is no requirement that a domestic article fall within the same HTS product description as an imported article in order to be like or directly competitive with the imported article. The purpose of the HTS subheadings is to classify articles for duty collection and statistical purposes as consistently as possible, not for determining whether domestic and imported articles are like or directly competitive with each other. However, as noted above, in its amendments to § 220.11, the Commission is requiring domestic producers to provide additional information in their comments, especially when such producers raise an objection to any petition. With regard to the ability of stakeholders to engage directly with CBP, that is a matter for CBP, not the Commission.

The proposals by Newell, Outdoor, and Simms to modify § 220.14(b) are not appropriate at this time. First, the Commission did not provide notice to the public that it is considering modifying this rule at this time. Second, the Commission has no authority to require the U.S. Department of Commerce to share information, including confidential business information, with petitioners or any other interested parties in this proceeding. Commerce determines how it will carry out its responsibilities under the statute and obtain the information required by law.

For the reasons stated in the preamble, the United States International Trade Commission amends 19 CFR part 220 as follows:

The final regulation (TD 9866) that is the subject of this correction is under section 951A of the Internal Revenue Code.

As published in June 21, 2019 (84 FR 29288), the final regulations (TD 9866; FR 2019-12437) contained errors that may prove misleading and therefore need to be corrected.

Accordingly, 26 CFR part 1 is corrected by making the following correcting amendments:

I. Table of Abbreviations CFR Code of Federal Regulations DHS Department of Homeland Security FR Federal Register NPRM Notice of Proposed Rulemaking § Section U.S.C. United States Code II. Background Information and Regulatory History

The Coast Guard is issuing this temporary final rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because doing so would be impracticable. The Coast Guard did not receive the final details of this regatta in time to publish an NPRM. As such, it is impracticable to publish an NPRM because we lack sufficient time to provide a reasonable comment period and then consider those comments before issuing the rule.

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

The Coast Guard is issuing this rule under authority in 46 U.S.C. 70034. The Captain of the Port Detroit (COTP) has determined that potential hazard associated with regatta from 7 a.m. through 5 p.m. on September 28, 2019 will be a safety concern to anyone within waters of the Maumee river, Toledo, OH from the Martin Luther King Jr. Memorial Bridge at river mile 4.30 to the Michael DiSalle Bridge at river mile 6.73. This rule is needed to protect personnel, vessels, and the marine environment in the navigable waters within the safety zone while the regatta occurs.

This rule establishes a safety zone from 7 a.m. through 5 p.m. on September 28, 2019. The safety zone will encompass all U.S. navigable waters of the Maumee river, Toledo, OH from the Martin Luther King Jr. Memorial Bridge at river mile 4.30 to the Michael DiSalle Bridge at river mile 6.73. No vessel or person will be permitted to enter the safety zone without obtaining permission from the COTP or a designated representative.

The Coast Guard will patrol the regatta area under the direction of the Captain of the Port Detroit (COTP), or a designated representative. A designated representative may be a Coast Guard Patrol Commander. Vessels desiring to transit the regulated area may do so only with prior approval of the COTP or a designated representative and when so directed by that officer. Vessels will be operated at a no wake speed to reduce the wake to a minimum, in a manner which will not endanger participants in the event or any other craft and remain vigilant for event participants and safety craft. Additionally, vessels must yield right-of-way for event participants and event safety craft and must follow directions given by the COTP or a designated representative. The rules contained in the above two sentences do not apply to participants in the event or vessels of the patrol operating in the performance of their assigned duties. COTP or a designated representative may direct the anchoring, mooring, or movement of any boat or vessel within the regatta area. A succession of sharp, short signals by whistle or horn from vessels patrolling the area under the direction of the U.S. COTP or a designated representative shall serve as a signal to stop. Vessels so signaled must stop and comply with the orders of the COTP or a designated representative. Failure to do so may result in expulsion from the area, citation for failure to comply, or both. The COTP or a designated representative may establish vessel size and speed limitations and operating conditions and may restrict vessel operation within the regatta area to vessels having particular operating characteristics. The COTP or a designated representative may terminate the marine event or the operation of any vessel at any time it is deemed necessary for the protection of life and property.

Patrol Commander means a Coast Guard commissioned, warrant, or petty officer who has been designated by the COTP to monitor a regatta area, permit entry into the regatta area, give legally enforceable orders to persons or vessels within the regatta area, and take other actions authorized by the COTP. The Patrol Commander will be aboard either a Coast Guard or Coast Guard Auxiliary vessel. The Patrol Commander may be contacted on VHF-FM Marine Channel 16 by the call sign “Coast Guard Patrol Commander.”

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

Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. Executive Order 13771 directs agencies to control regulatory costs through a budgeting process. This rule has not been designated a “significant regulatory action,” under Executive Order 12866. Accordingly, this rule has not been reviewed by the Office of Management and Budget (OMB), and pursuant to OMB guidance it is exempt from the requirements of Executive Order 13771.

This regulatory action determination is based on the size, location, duration, and time-of-year of the regulated area. Vessel traffic will be able to safely transit around this regulated area, which will impact a small designated area of the Maumee River in Toledo, OH for a period of 10 hours. Moreover, the Coast Guard will issue Broadcast Notice to Mariners via VHF-FM Marine Channel 16 about the regulated area and the rule allows vessels to seek permission to enter the regulated area.

The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601-612, as amended, requires federal agencies to consider the potential impact of regulations on small entities during rulemaking. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities. Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered the impact of this temporary rule on small entities. While some owners or operators of vessels intending to transit the safety zone may be small entities, for the reasons stated in section V.A above, this rule will not have a significant economic impact on any vessel owner or operator.

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

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

This rule will not call for a new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under that Order and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in Executive Order 13132.

Also, this rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. If you believe this rule has implications for federalism or Indian tribes, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section above.

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

We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Environmental Planning COMDTINST 5090.1 (series), which guide the Coast Guard in complying with the National Environmental Policy Act of 1969(42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves a special local regulation interval lasting for a period of 10 hours that will prohibit entry within waters of the Maumee river, Toledo, OH from the Martin Luther King Jr. Memorial Bridge at river mile 4.30 to the Michael DiSalle Bridge at river mile 6.73. It is categorically excluded from further review under paragraph L61 in Table 3-1 of U.S. Coast Guard Environmental Planning Implementing Procedures 5090.1. A Record of Environmental Consideration supporting this determination is available in the docket where indicated under ADDRESSES .

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

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 100 as follows:

The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because it is impracticable due to the lack of sufficient time to provide a reasonable comment period and consider those comments before issuing the rule and establishing the safety zone by August 31, 2019.

Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register . Delaying the effective date of this rule would be contrary to the public interest because immediate action is needed to address potentially hazardous conditions associated with high-speed maneuvers from waterborne vessels and aircraft for a search and rescue demonstration.

The Coast Guard is issuing this rule under authority in 46 U.S.C. 70034. The Captain of the Port, Sector Los Angeles—Long Beach (COTP) has determined the navigational safety will be affected by the potentially hazardous conditions associated with event safety due to the expected high-speed maneuvers from waterborne vessels and aircraft for a search and rescue demonstration along the main shipping channel of the nation's most economically vital port complex. For these reasons the Coast Guard believes that a safety zone is necessary to ensure the safety of, and reduce the risk to, the public, and mariners, in the Port of Los Angeles.

This rule establishes a temporary security zone from 10 a.m. through 4 p.m. from August 31, 2019 to September 2, 2019, encompassing all navigable waters from the surface to the sea floor consisting of a line connecting the following coordinates: 33°44.386′ N 118°16.658′ W, 33°44.370′ N 118°16.545′ W, 33°44.858′ N 118°162.86′ W, 33°44.897′ N 118°16.399′ W. All coordinates displayed are referenced by North American Datum of 1983, World Geodetic System, 1984.

No vessel or person is permitted to operate in the safety zone without obtaining permission from COTP or the COTP's designated representative. A designated representative means a Coast Guard Patrol Commander, including a Coast Guard coxswain, petty officer, or other officer operating a Coast Guard vessel and a Federal, State, and local officer designated by or assisting the COTP in the enforcement of the security zone. To seek permission to enter, hail Coast Guard Sector Los Angeles—Long Beach on VHF-FM Channel 16 or 310-521-3801. Upon being hailed by a Coast Guard vessel or designated representative, by siren, radio, flashing light or other means, the operator of the vessel shall proceed as directed.

The general boating public will be notified prior to the enforcement of the temporary safety zone via Broadcast Notice to Mariners.

We developed this rule after considering numerous statutes and executive orders (E.O.s) related to rulemaking. Below we summarize our analyses based on a number of these statutes and E.O.s, and we discuss First Amendment rights of protestors.

E.O.s 12866 (“Regulatory Planning and Review”) and 13563 (“Improving Regulation and Regulatory Review”) direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits including potential economic, environmental, public health and safety effects, distributive impacts, and equity. E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. Executive Order 13771 (“Reducing Regulation and Controlling Regulatory Costs, directs agencies to reduce regulation and control regulatory costs and provides that “for every one new regulation issued, at least two prior regulations be identified for elimination, and that the cost of planned regulations be prudently managed and controlled through a budgeting process.”

This regulatory action determination is based on the size, location, duration of the safety zone. Commercial vessel traffic will be temporarily impacted by this rule, due to its impact a designated area of the of Los Angles main channel in the vicinity of the Port of Los Angeles between Berth's 84-93A. The Coast Guard and Inter Agency Unified Command will establish communications with the LA Pilots and Vessel Traffic Service/Marine Exchange to coordinate and mitigate all inbound and outbound commercial and recreational traffic movements through the 0.12 square mile safety zone.

The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

While some owners or operators of vessels intending to transit the security zone may be small entities, for the reasons stated in section V.A above, this rule will not have a significant economic impact on any vessel owner or operator. Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section.

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

This rule will not call for a new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

A rule has implications for federalism under E.O. 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under that Order and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in E.O. 13132.

Also, this rule does not have tribal implications under E.O. 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. If you believe this rule has implications for federalism or Indian tribes, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section above.

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

We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Environmental Planning COMDTINST 5090.1 (series), which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves a safety zone encompassing a 0.12 square mile area around the Los Angeles Fleet Week events, in the Port of Los Angeles between Berth's 84-93A, effective from 10 a.m. to 4 p.m. each day from August 31, 2019 through September 2, 2019. Such actions are categorically excluded from further review under paragraph 60(a) in Table 3-1 of U.S. Coast Guard Environmental Planning Implementing Procedures 5090.1. An environmental analysis checklist supporting this determination and Record of Environmental Consideration (REC) are available in the docket where indicated under ADDRESSES .

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

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

The Coast Guard will enforce a segment of the Safety Zone; Brandon Road Lock and Dam to Lake Michigan including Des Plaines River, Chicago Sanitary and Ship Canal, Chicago River, Calumet-Saganashkee Channel, Chicago, IL, listed in 33 CFR 165.930. Specifically, the Coast Guard will enforce this safety zone on all waters of the Chicago Sanitary and Ship Canal and South Branch of the Chicago River between mile marker 319 and mile marker 322. Enforcement will occur from 7 a.m. through 2 p.m. on October 27, 2019. During the enforcement period, no vessel may transit this regulated area without approval from the Captain of the Port Lake Michigan or a designated representative. Vessels and persons granted permission to enter the safety zone shall obey all lawful orders or directions of the Captain of the Port Lake Michigan, or an on-scene representative.

This notice of enforcement is issued under the authority of 33 CFR 165.930 and 5 U.S.C. 552(a). In addition to this publication in the Federal Register , the Captain of the Port Lake Michigan will also provide notice through other means, which will include Broadcast Notice to Mariners, Local Notice to Mariners, distribution in leaflet form, and on-scene oral notice. Additionally, the Captain of the Port Lake Michigan may notify representatives from the maritime industry through telephonic and email notifications. If the Captain of the Port or a designated representative determines that the regulated area need not be enforced for the full duration stated in this notice, he or she may use a Broadcast Notice to Mariners to grant general permission to enter the regulated area. The Captain of the Port Lake Michigan or a designated on-scene representative may be contacted via Channel 16 or at (414) 747-7182.

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

On July 11, 2019 (84 FR 33035), under section 110(k)(4) of the Clean Air Act (CAA or “Act”), the EPA proposed to conditionally approve a SIP revision titled “Revision to Motor Vehicle Emissions Budgets in Ozone Redesignation Request and Maintenance Plan: Clark County, Nevada” (October 2018) (herein, referred to as the “2018 Ozone Maintenance Plan Revision”), submitted by the Nevada Division of Environmental Protection (NDEP) on October 31, 2018. The 2018 Ozone Maintenance Plan Revision updates certain elements of the maintenance plan for Clark County for the 1997 ozone NAAQS, including the attainment inventory, the maintenance demonstration and the motor vehicle emissions budgets (“budgets”). The updated budgets replace Clark County's existing budgets for the 1997 ozone NAAQS, and the previously-approved budgets will no longer be applicable for transportation conformity purposes on the publication date of this final conditional approval in the Federal Register . 1 We proposed a conditional approval based on commitments from NDEP and the Clark County Department of Air Quality (DAQ) to submit a SIP revision within one year of final conditional approval. 2 The purpose of the future SIP revision is to reduce the safety margin allocations in the budgets to ensure that the 2018 Ozone Maintenance Plan Revision, when revised to reduce the safety margin allocations, will not interfere with reasonable further progress or attainment of the 2008 and 2015 ozone NAAQS.

For more information on the background for this action, including a description of the ozone NAAQS, the ozone area designations for Clark County, the 2011 Ozone Maintenance Plan and the EPA's MOVES emissions model, and the rationale for conditional approval of the 2018 Ozone Maintenance Plan Revision, please see our July 11, 2019 proposed rule.

The public comment period on the proposed rule opened on July 11, 2019, the date of its publication in the Federal Register , and closed on August 12, 2019. During this period, the EPA received no comments.

For the reasons discussed in our July 11, 2019 proposed rule and summarized above, the EPA is taking final action under CAA section 110(k)(4) to conditionally approve the 2018 Ozone Maintenance Plan Revision submitted by NDEP on October 31, 2018, as a revision of the Clark County portion of the Nevada SIP. In so doing, we find that the 2011 Ozone Maintenance Plan, as revised by the updated attainment inventory and maintenance demonstration in the 2018 Ozone Maintenance Plan Revision, continues to provide for maintenance of the 1997 ozone NAAQS, and upon fulfillment of the commitments made by NDEP and Clark County DAQ to reduce the safety margin allocations for the budgets, will not interfere with reasonable further progress or attainment of the other NAAQS in Clark County. In conditionally approving the 2018 Ozone Maintenance Plan Revision, the EPA is also finding adequate and conditionally approving the updated oxides of nitrogen (NO X ) and volatile organic compound (VOC) budgets for 2008, 2015, and 2022 for the 1997 ozone NAAQS (shown in Table 1) based on our conclusion that the updated budgets meet the applicable transportation conformity requirements.

The approval of the 2018 Ozone Maintenance Plan Revision is conditional because it is based on commitments from NDEP and the Clark County DAQ to submit a SIP revision within one year of final conditional approval. 3 The purpose of the future SIP revision is to reduce the safety margin allocations to the budgets to ensure that the 2018 Ozone Maintenance Plan Revision, when revised to reduce the safety margin allocations, will not interfere with reasonable further progress or attainment of the 2008 and 2015 ozone NAAQS.

Lastly, the revised budgets in Table 1 replace the existing approved budgets from the 2011 Ozone Maintenance Plan; the Regional Transportation Commission and the U.S. Department of Transportation must use these revised budgets for future transportation conformity determinations.

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

• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);

• Is not an Executive Order 13771 (82 FR 9339, February 2, 2017) regulatory action because SIP approvals are exempted under Executive Order 12866;

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

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

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

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

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

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

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

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

In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, this rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).

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

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by October 28, 2019. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

Chapter I, title 40 of the Code of Federal Regulations is amended as follows:

Throughout this document, “we,” “us” and “our” refer to the EPA.

On June 10, 2019 (84 FR 26804), the EPA proposed to approve the following rules into the Arizona SIP.

We proposed to approve these rules because we determined that they comply with the relevant CAA requirements. Our proposed action contains more information on the rules and our evaluation.

The EPA's proposed action provided a 30-day public comment period. During this period, we received one comment. This comment generally expressed support for the EPA's proposed action. The commenter also stated that “the exception in the SIP to exempt Indian reservation land and areas where the EPA does not have jurisdiction is a concern.”

We understand the comment to refer to the EPA's discussion of Executive Order 13175, specifically, the EPA's statement that “the SIP is not approved to apply on any Indian reservation land or in any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction.” The EPA typically uses such statements in actions regarding state SIP submittals to explain the non-applicability of the SIP on tribal lands. The State of Arizona submitted the rules in this action to apply only on lands where the State and relevant local agency have jurisdiction. The commenter's concerns regarding the inapplicability of the SIP in areas where the EPA or an Indian tribe has jurisdiction does not bear upon whether the rules that are the subject of our action meet the applicable requirements for approval of a SIP submission. Therefore, we do not find that the comment provides a basis for the EPA to change its assessment of the submitted rules or our proposal to approve them.

No comments were submitted that change our assessment of the rules as described in our proposed action. Therefore, as authorized in section 110(k)(3) of the Act, the EPA is fully approving these rules into the Arizona SIP.

In this rule, the EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, the EPA is finalizing the incorporation by reference of the MCAQD rules described in the amendments to 40 CFR part 52 set forth below. Therefore, these materials have been approved by the EPA for inclusion in the SIP, have been incorporated by reference by the EPA into that plan, are fully federally enforceable under sections 110 and 113 of the CAA as of the effective date of this final rulemaking, and will be incorporated by reference in the next update to the SIP compilation. 1 The EPA has made, and will continue to make, these documents available through www.regulations.gov and at the EPA Region IX Office (please contact the person identified in the FOR FURTHER INFORMATION CONTACT section of this preamble for more information).

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

• Is not a significant regulatory action subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);

• Is not an Executive Order 13771 (82 FR 9339, February 2, 2017) regulatory action because SIP approvals are exempted under Executive Order 12866;

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

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

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

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

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

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

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

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

In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).

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

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by October 28, 2019. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

Part 52, chapter I, title 40 of the Code of Federal Regulations 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://www.ecfr.gov/cgi-bin/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-2018-0526 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing and must be received by the Hearing Clerk on or before October 28, 2019. 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-2018-0526, 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.html.

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 February 6, 2019 (84 FR 2115) (FRL-9987-08), 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 8F8679) by Syngenta Crop Protection, LLC, P.O. Box 18300, Greenboro, NC 27419. The petition requested that 40 CFR 180.665 be amended by establishing a tolerance for residues resulting from seed treatment uses of the fungicide sedaxane, in or on legume vegetables (dried or succulent), crop group 6 at 0.01 parts per million (ppm) and to remove the existing tolerances for soybean, seed at 0.01 ppm and pea and bean, dried shelled, except soybean, subgroup 6C at 0.01 ppm upon establishment of the group 6 tolerance. That document referenced a summary of the petition prepared by Syngenta, which is available in the docket, http://www.regulations.gov. There were no comments received in response to the notice of filing.

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 sedaxane including exposure resulting from the tolerances established by this action. EPA's assessment of exposures and risks associated with sedaxane 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 main target tissue for sedaxane is the liver. Sedaxane also caused thyroid hypertrophy/hyperplasia in male rats. In the acute neurotoxicity (ACN) and sub-chronic neurotoxicity (SCN) studies, sedaxane caused decreased activity, muscle tone, rearing and grip strength; however, no adverse histopathology was observed, and EPA has concluded that there is low concern for neurotoxicity.

In the rat, no adverse effects in fetuses were seen in developmental toxicity studies at maternally toxic doses. In the rabbit, fetal toxicity was observed at the same doses as the dams. Offspring effects in the rat reproduction study occurred at the same doses causing parental effects.

The available data show evidence of liver tumors (in male rats and mice), thyroid tumors (in male rats), and uterine tumors (in female rats) resulting from exposure to sedaxane. Based on a weight of evidence of the available data, a constitutive androstane receptor/pregnane-X receptor (CAR/PXR)-mediated mitogenic mode-of action (MOA) was established for liver tumors in male mice and rats and a liver-mediated altered thyroid hormone homeostasis MOA was established for thyroid tumors in male rats. At this time, a MOA for the uterine tumors has not been identified.

To quantitatively assess the carcinogenic potential of sedaxane, EPA has concluded that a non-linear approach ( i.e., reference dose (RfD)) is appropriate for the following reasons: (1) There is a clear understanding of the threshold (non-linear) doses associated with the key events in the established MOAs leading to liver and thyroid tumors in rodents, the key events occur only at doses that well exceed the chronic reference dose (0.11 mg/kg/day); (2) Sedaxane is not mutagenic or genotoxic; (3) The dose at which uterine tumors was observed is at 261 mg/kg/day, which greatly exceeds the chronic reference dose (0.11 mg/kg/day) being used to assess chronic exposure to sedaxane.

Sedaxane has low acute toxicity by the oral, dermal, and inhalation routes. It is not a dermal sensitizer, causes no skin irritation and only slight eye irritation.

Specific information on the studies received and the nature of the adverse effects caused by sedaxane as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies are discussed in the final rule published in the Federal Register of December 8, 2017 (82 FR 57867) (FRL-9970-04).

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 NOAEL and 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 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 sedaxane used for human risk assessment is discussed in Unit III.B. of the final rule published in the Federal Register of December 8, 2017 (82 FR 57867) (FRL-9970-04).

1. Dietary exposure from food and feed uses. In evaluating dietary exposure to sedaxane, EPA considered exposure under the petitioned-for tolerances as well as all existing sedaxane tolerances in 40 CFR 180.665. EPA assessed dietary exposures from sedaxane 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 sedaxane. In estimating acute dietary exposure, EPA used food consumption information from the United States Department of Agriculture (USDA) under the Nationwide Continuing Surveys of Food Intake by Individuals (CSFII) and the CDC under the National Health and Nutrition Examination Survey What We Eat in America (NHANES/WWEIA) 2003-2008. As to residue levels in food, EPA assumed tolerance-level residues for all commodities and 100% crop treated. Default processing factors were used with the exception of peanut butter which uses empirical processing data.

ii. Chronic exposure. In conducting the chronic dietary exposure assessment EPA used the food consumption data from the USDA NHANES/WEIA 2003-2008. As to residue levels in food, EPA assumed tolerance-level residues for all commodities and 100% crop treated (CT). Default processing factors were used with the exception of peanut butter which uses empirical processing data.

iii. Cancer. Based on the data summarized in Unit III.A., EPA has concluded that a nonlinear RfD approach is appropriate for assessing cancer risk to sedaxane. Cancer risk was assessed using the same exposure estimates as discussed in Unit III.C.1.ii.

iv. Anticipated residue and percent crop treated (PCT) information. EPA did not use anticipated residue and/or PCT information in the dietary assessment for sedaxane. Tolerance-level residues and/or 100% CT were assumed for all food commodities.

2. Dietary exposure from drinking water. The Agency used screening level water exposure models in the dietary exposure analysis and risk assessment for sedaxane in drinking water. These simulation models take into account data on the physical, chemical, and fate/transport characteristics of sedaxane. 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 First Index Reservoir Screening Tool (FIRST) and Pesticide Root Zone Model Ground Water (PRZM GW), the estimated drinking water concentrations (EDWCs) of sedaxane for acute exposures are estimated to be 4.1 parts per billion (ppb) for surface water and 15.1 ppb for ground and for chronic exposures for non-cancer assessments are estimated to be 1.2 ppb for surface water and 13.0 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 15.1 ppb was used to assess the contribution to drinking water. For chronic dietary risk assessment, the water concentration of value 13.0 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). Sedaxane 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.”

Unlike other pesticides for which EPA has followed a cumulative risk approach based on a common mechanism of toxicity, EPA has not made a common mechanism of toxicity finding as to sedaxane and any other substances, and sedaxane does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that sedaxane 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 website at https://www.epa.gov/pesticide-science-and-assessing-pesticide-risks/cumulative-assessment-risk-pesticides.

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 for increased susceptibility following prenatal or post-natal exposures to sedaxane based on effects seen in developmental toxicity studies in rabbits or rats. In range-finding and definitive developmental toxicity studies in rats, neither quantitative nor qualitative evidence of increased susceptibility of fetuses to in utero exposure to sedaxane was observed. In these studies, there were no single-dose effects. There was no evidence of increased susceptibility in a 2-generation reproduction study in rats following prenatal or post-natal exposure to sedaxane. Clear NOAELs/LOAELs were established for the developmental effects seen in rats and rabbits as well as for the offspring effects seen in the 2-generation reproduction study. The dose-response relationship for the effects of concern is well characterized.

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:

i. The toxicity database for sedaxane is complete.

ii. Given the available information, there is low concern that sedaxane is a neurotoxic chemical and there is no need for a developmental neurotoxicity study or additional uncertainty factors (UFs) to account for neurotoxicity.

iii. In the rat, no adverse effects in fetuses were seen in developmental toxicity studies at maternally toxic doses. In the rabbit, fetal toxicity was observed at the same doses as the dam (increased unossified sternebrae and 13th rudimentary ribs, a decrease in fetal weights of 9% and increased abortions). In the dam, at the same doses, the effects were decreased body weight, reduced food consumption, and decreased defecation. In reproduction studies, offspring effects occurred at the same doses causing parental effects; thus, there was no quantitative or qualitative increase in sensitivity in rat pups. The LOAELs and NOAELs for the developmental and reproduction studies were clearly defined. The NOAEL used for the acute dietary risk assessment (30 mg/kg/day), based on effects observed in the ACN study, is protective of the developmental and offspring effects seen in rabbits and rats with the NOAELs of 100-200 mg/kg/day. Based on these considerations, there are no residual uncertainties for pre-and/or post-natal susceptibility.

iv. There are no residual uncertainties identified in the exposure databases. The dietary food exposure assessments were performed based on 100% CT and tolerance-level residues. EPA made conservative (protective) assumptions in the ground and surface water modeling used to assess exposure to sedaxane in drinking water. These assessments will not underestimate the exposure and risks posed by sedaxane.

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 sedaxane will occupy <1% of the aPAD for all infants (<1-year-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 sedaxane from food and water will utilize <1% of the cPAD for all population subgroups the population group receiving the greatest exposure. There are no residential uses for sedaxane.

3. Short-term risk. Short-term aggregate exposure takes into account short-term residential exposure plus chronic exposure to food and water (considered to be a background exposure level). Because there are no proposed or registered residential uses of sedaxane a short-term risk assessment was not performed. The chronic risk assessment is protective for any short-term exposures from food and drinking water.

4. Intermediate-term risk. Intermediate-term aggregate exposure takes into account intermediate-term residential exposure plus chronic exposure to food and water (considered to be a background exposure level). Because there are no proposed or registered residential uses of sedaxane, an intermediate-term risk assessment was not performed. The chronic assessment is protective for any intermediate-term exposures from food and drinking water.

5. Aggregate cancer risk for U.S. population. As discussed in Unit III.A., EPA has concluded that using the nonlinear approach based on the chronic RfD will be protective of potential carcinogenicity. Because the chronic risk is below the Agency's level of concern, EPA concludes there is no aggregate cancer risk from exposure to sedaxane.

6. 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 sedaxane residues.

An adequate analytical method is available to enforce the proposed tolerances for sedaxane in plant commodities. A modification of the Quick, Easy, Cheap, Effective, Rugged, and Safe (QuEChERS) method was developed for the determination of residues of sedaxane (as its isomers SYN508210 and SYN508211) in/on various crops. The sedaxane isomers (SYN508210 and SYN508211) are quantitatively determined by LC/MS/MS. The validated limit of quantitation (LOQ) reported in the method is 0.005 ppm for each sedaxane isomer.

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.

The Codex has not established an MRL for sedaxane in or on the legume vegetables crop grouping.

Therefore, tolerances are established for residues of sedaxane in or on vegetable, legume, group 6 at 0.01 ppm. In addition, the Agency is removing the existing tolerances for pea and bean, dried shelled, except soybean, subgroup 6C, and soybean seed as they are unnecessary upon the establishment of the group 6 tolerance.

This action 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 action has been exempted from review under Executive Order 12866, this action 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), nor is it considered a regulatory action under Executive Order 13771, entitled “Reducing Regulations and Controlling Regulatory Costs” (82 FR 9339, February 3, 2017). This action 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 action 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 action. In addition, this action does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act (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 (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 Publishing Office's e-CFR site at http://www.ecfr.gov/cgi-bin/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-2018-0095 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before October 28, 2019. 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-2018-0095, 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.html.

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 July 24, 2018 (83 FR 34968) (FRL-9980-31), 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 7E8645) by Interregional Research Project No. 4 (IR-4), Rutgers, The State University of New Jersey, 500 College Road East, Suite 201W, Princeton, NJ 08540. The petition requested that 40 CFR 180.350 be amended by establishing tolerances for residues of the nitrification inhibitor nitrapyrin (2-chloro-6-(trichloromethyl) pyridine) and its metabolite, 6-chloropicolinic acid (6-CPA), calculated as the stoichiometric equivalent of nitrapyrin, in or on citrus, dried pulp at 0.094 parts per million (ppm); citrus, oil at 0.37 ppm; fruit, citrus, group 10-10 at 0.03 ppm; leaf petiole vegetable subgroup 22B at 0.4 ppm; Vegetable, brassica, head and stem, group 5-16 at 0.07 ppm; vegetable, bulb, group 3-07 at 0.3 ppm; and vegetable, leafy, group 4-16 at 0.3 ppm. That document referenced a summary of the petition prepared by Dow AgroSciences 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 is establishing tolerances that vary from what the petitioner requested, as authorized under FFDCA section 408(d)(4)(A)(i). EPA's explanation for those variations is contained 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 nitrapyrin including exposure resulting from the tolerances established by this action. EPA's assessment of exposures and risks associated with nitrapyrin follows.

EPA has evaluated the available toxicity data and considered their 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.

In oral studies, the liver is the target organ for nitrapyrin, and liver effects are evident in all species tested. Clear signs of hepatotoxicity ( i.e., marked changes in clinical chemistry in dogs, indicative of liver toxicity and histopathology in rats and mice, leading to malignant tumor formation in mice) are seen after repeated exposure. Nitrapyrin does not show qualitative or quantitative susceptibility in the rat or rabbit developmental studies or in the 2-generation reproduction study. The observed adverse effects ( e.g., delayed ossification and decreased fetal body weight in the developmental rat study and liver effects in pups in the rat reproduction study) occurred at the same doses as maternal toxicity. There is low concern for the altered motor activity seen after acute or subchronic exposure because: Clear no-observed adverse effect levels (NOAELs) and lowest-observed adverse effect levels (LOAELs) have been established; no corroborating gross pathological or neuropathological effects were found in any other study in the database; and the selected endpoints are protective of the observed effects.

Nitrapyrin is not mutagenic or immunotoxic, and no effects were observed in the subchronic dermal toxicity study in rabbits up to the limit dose. Nitrapyrin is classified as having “suggestive” evidence of carcinogenicity, based on liver adenomas and carcinomas in mice. This classification is supported by the following factors: (1) Liver tumors were not seen in the 2-year carcinogenicity study in rats; (2) The response is driven by benign adenomas; (3) Mutagenicity was ruled out as a mode of action; and (4) There are adequate data supporting the MOA of mitogenesis through activation CAR nuclear receptors in male mice but not in female mice. In addition, the chronic reference dose (0.03 mg/kg/day) is approximately 4000X lower than the dose at which tumors are seen in the female mouse. Therefore, quantification of cancer risk using a non-linear Reference Dose (RfD) approach adequately accounts for all chronic toxicity, including carcinogenicity that could result from exposure to nitrapyrin.

Specific information on the studies received and the nature of the adverse effects caused by nitrapyrin as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies are discussed in the final rule published in the Federal Register of November 30, 2017 (82 FR 56739) (FRL-9967-73).

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://www2.epa.gov/pesticide-science-and-assessing-pesticide-risks/assessing-human-health-risk-pesticides.

A summary of the toxicological endpoints for nitrapyrin used for human risk assessment is discussed in Unit III.B of the final rule published in the Federal Register of November 30, 2017 (82 FR 56739) (FRL-9967-73).

1. Dietary exposure from food and feed uses. In evaluating dietary exposure to nitrapyrin, EPA considered exposure under the petitioned-for tolerances as well as all existing nitrapyrin tolerances in 40 CFR 180.350. EPA assessed dietary exposures from nitrapyrin 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 nitrapyrin. In estimating acute dietary exposure, EPA used food consumption information from the United States Department of Agriculture (USDA) 2003-2008 National Health and Nutrition Examination Survey, What We Eat in America. (NHANES/WWEIA). As to residue levels in food, EPA assumed tolerance-level residues and 100 percent crop treated (PCT).

ii. Chronic exposure. In conducting the chronic dietary exposure assessment, EPA used the food consumption data from the USDA 2003-2008 NHANES/WWEIA. As to residue levels in food, EPA assumed tolerance-level residues and 100 PCT.

iii. Cancer. Based on the data cited in Unit III.A., EPA has concluded that quantification of cancer risk using a nonlinear RfD approach adequately accounts for all chronic toxicity, including carcinogenicity that could result from exposure to nitrapyrin. 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. EPA did not use anticipated residue and/or PCT information in the dietary assessment for nitrapyrin. Tolerance level residues and/or 100 PCT were assumed for all food commodities.

2. Dietary exposure from drinking water. The Agency used screening level water exposure models in the dietary exposure analysis and risk assessment for nitrapyrin in drinking water. These simulation models take into account data on the physical, chemical, and fate/transport characteristics of nitrapyrin. Further information regarding EPA drinking water models used in pesticide exposure assessment can be found at http://www2.epa.gov/pesticide-science-and-assessing-pesticide-risks/about-water-exposure-models-used-pesticide.

Based on the Tier II pesticide water calculator (PWC), which incorporates the Pesticide Root Zone Model Ground Water (PRZM GW), the estimated drinking water concentrations (EDWCs) of nitrapyrin residues of concern for acute exposures are estimated to be 51 parts per billion (ppb) for surface water and 76 ppb for ground water, and for chronic exposures for non-cancer assessments are estimated to be 15 ppb for surface water and 67 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 76 ppb was used to assess the contribution to drinking water. For chronic dietary risk assessment, the water concentration of value 67 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). Nitrapyrin 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 nitrapyrin to share a common mechanism of toxicity with any other substances, and nitrapyrin does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that nitrapyrin 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 website at http://www2.epa.gov/pesticide-science-and-assessing-pesticide-risks/cumulative-assessment-risk-pesticides.

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 are adequate pre- and/or post-natal toxicity studies that do not show quantitative susceptibility in the rabbit or rat developmental studies or in the two-generation reproduction study. In the developmental toxicity in the rabbit, an increased incidence of crooked hyoid bones was seen at the highest dose tested. This effect is considered to be treatment-related but not adverse. In the rat developmental study, developmental toxicity (delayed ossification and decreased fetal body weight) occurred at the same dose as maternal toxicity (reduced body weight/weight gain and reduced food consumption). Toxic effects in the 2-generation reproduction study also occurred at the same dose in both parental animals and the offspring and included increased liver weights (parental M and F; both generations), enlarged livers in F2 pups (M and F), and hepatic vacuolation consistent with fatty changes in parental and offspring animals (both sexes and both generations). Similarly, gross pathological or neuropathological findings in the neurotoxicity studies were negative.

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:

i. The toxicity database for nitrapyrin is complete.

ii. An acceptable acute neurotoxicity study and an acceptable subchronic neurotoxicity study are available for nitrapyrin. Acutely, nitrapyrin induced tremors and other functional observation battery effects ( i.e., slight gait incoordination, palpebral closure and perineal fecal staining) at the high dose (400 mg/kg) only. Decreased motor activity was seen in both sexes at 400 mg/kg and in females at 80 mg/kg. In contrast, increased motor activity was observed in the subchronic neurotoxicity study in female rats but only at high doses (≥500 mg/kg/day). However, concern is low since: (1) There are clear NOAELs/LOAELs; (2) there are no corroborating gross pathological or neuropathological findings; (3) there was no evidence of neurotoxicity in other studies in the database; and (4) the selected endpoints are protective of the observed effects.

iii. There is no evidence that nitrapyrin 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. Effects on the offspring were either not treatment-related or occurred only at the same parental dose.

iv. There are no residual uncertainties identified in the exposure databases. The dietary food exposure assessments were performed based on 100 PCT and tolerance-level residues. EPA made conservative (protective) assumptions in the ground and surface water modeling used to assess exposure to nitrapyrin in drinking water. These assessments will not underestimate the exposure and risks posed by nitrapyrin.

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 nitrapyrin will occupy 8.5% of the aPAD for all infants (less than 1-year 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 nitrapyrin from food and water will utilize 17% of the cPAD for children 1 to 2 years old, the population group receiving the greatest exposure. There are no residential uses for nitrapyrin.

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).

However, nitrapyrin is not registered for, or proposed for, any residential uses. Therefore, because there is no short-term or intermediate-term residential exposure and chronic dietary exposure has already been assessed under the appropriately protective cPAD (which is at least as protective as the POD used to assess short-term risk), no further assessment of short- or intermediate-term risk is necessary, and EPA relies on the chronic dietary risk assessment for evaluating short- and intermediate-term risk for nitrapyrin.

4. Aggregate cancer risk for U.S. population. Based on the discussion in Unit III.A., EPA considers the chronic aggregate risk assessment to be protective of any aggregate cancer risk. As there is no chronic risk of concern, EPA does not expect any cancer risk to the U.S. population from aggregate exposure to nitrapyrin.

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 nitrapyrin residues.

Adequate enforcement methodology (gas chromatograph/electron capture detector) is available to enforce the tolerance expression. Seven analytical methods are available in Volume II of the Pesticide Analytical Manual (PAM ii—Pesticide Reg. Sec. 180.350) for tolerance enforcement for nitrapyrin and/or for metabolite 6-CPA.

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

The Codex has not established a MRL for nitrapyrin.

EPA is establishing tolerances for residues of nitrapyrin at different levels than requested in the petition for most commodities. For fruit, citrus, group 10-10, dried pulp and fruit, citrus, group 10-10, oil, EPA established the tolerances based on the processing study and highest average field trial residue for the raw agricultural commodity lemon. This leads to higher tolerances (0.5 ppm for fruit, citrus, group 10-10, dried pulp and 2 ppm for fruit, citrus, group 10-10, oil) than those proposed by petitioner (0.094 ppm and 0.37 ppm, respectively). EPA also corrected the commodity names for these commodities.

Based on the residue chemistry data and the Organization for Economic Co-Operation and Development (OECD) tolerance-calculation procedure, EPA is establishing different tolerances for fruit, citrus, group 10-10; leaf petiole vegetable subgroup 22B; vegetable, Brassica, head and stem, group 5-16; and vegetable, leafy, group 4-16, because the tolerance values proposed by the petitioner do not include the combined residues of nitrapyrin and its metabolite 6-CPA.

In addition, EPA is revising the tolerance expression in § 180.350(a) to correctly identify nitrapyrin as a nitrification inhibitor rather than the current identification as an insecticide. The rest of the tolerance expression remains the same. The revised tolerance expression is:

(a) General. Tolerances are established for residues of the nitrification inhibitor nitrapyrin, including its metabolites and degradates, in or on the commodities in the table below. Compliance with the tolerance levels specified below is to be determined by measuring only the sum of nitrapyrin (2-chloro-6-(trichloromethyl) pyridine) and its 6-CPA metabolite (6-chloro-picolinic acid), calculated as the stoichiometric equivalent of nitrapyrin, in or on the commodity.

Therefore, tolerances are established for residues of nitrapyrin, by measuring only the sum of nitrapyrin (2-chloro-6-(trichloromethyl) pyridine) and its 6-CPA (6-chloropicolinic acid) metabolite, calculated as the stoichiometric equivalent of nitrapyrin, in or on fruit, citrus, group 10-10 at 0.06 ppm; fruit, citrus, group 10-10, dried pulp at 0.5 ppm; fruit, citrus, group 10-10, oil at 2 ppm; leaf petiole vegetable subgroup 22B at 0.5 ppm; vegetable, Brassica, head and stem, group 5-16 at 0.1 ppm; vegetable, bulb, group 3-07 at 0.3 ppm; and vegetable, leafy, group 4-16 at 0.4 ppm.

This action 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 action has been exempted from review under Executive Order 12866, this action 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), nor is it considered a regulatory action under Executive Order 13771, entitled “Reducing Regulations and Controlling Regulatory Costs” (82 FR 9339, February 3, 2017). This action 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 tolerances 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 action 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 action. In addition, this action does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act (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 (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:

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

You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. 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 40 CFR part 180 through the Government Publishing Office's e-CFR site at http://www.ecfr.gov/cgi-bin/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-2019-0093 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before October 28, 2019. 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-2019-0093, 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.html. 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 5, 2009 (74 FR 38935) (FRL-8430-1), EPA issued a final rule, announcing the establishment of a tolerance exemption pursuant to a pesticide petition (PP 9E7534) by The Joint Inerts Task Force, Cluster Support Team 1 (CST 1), c/o CropLife America, 1156 15th Street NW, Suite 400, Washington, DC 20005. The petition requested that 40 CFR 180.910, 180.930, 180.940(a) and 180.960 be amended by establishing an exemption from the requirement of a tolerance for residues of a group of substances known as α-alkyl-ω-hydroxypoly(oxypropylene) and/or poly (oxyethylene) polymers where the alkyl chain contains a minimum of 6 carbons, herein referred to in this document as AAA.

The current petition seeks to expand the exemptions for AAA by adding additional CAS Reg. Nos. In the Federal Register of May 13, 2019 (84 FR 20843) (FRL-9991-91), EPA issued a document pursuant to FFDCA section 408, 21 U.S.C. 346a, announcing the filing of a pesticide petition (PP IN-11254) by Exponent Inc. on behalf of Clariant Corporation, Suite 1100, 1150 Connecticut Avenue NW, Washington DC 20036. The petition requested that 40 CFR 180.910, 180.930, 180.940(a) and 180.960 be amended by establishing an exemption from the requirement of a tolerance for residues of oxirane, 2-methyl-, polymer with oxirane, monoundecyl ether, branched and linear (CAS Reg. No. 2222805-23-2). That document referenced a summary of the petition prepared by Exponent, the petitioner, 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 confirmed that the requested CAS Reg. No. is acceptable for consideration under the currently approved descriptor. This determination is based on the Agency's risk assessment which can be found at http://www.regulations.gov in document “Alkyl Alcohol Alkoxylates (AAA-JITF CST 1 Inert Ingredient), Human Health Risk Assessment to Support Proposed Exemption from the Requirement of a Tolerance under 40 CFR 180.960 when used as an Inert Ingredient in Pesticide Formulations” in docket ID number EPA-HQ-OPP-2009-0145.

Inert ingredients are all ingredients that are not active ingredients as defined in 40 CFR 153.125 and include, but are not limited to, the following types of ingredients (except when they have a pesticidal efficacy of their own): Solvents such as alcohols and hydrocarbons; surfactants such as polyoxyethylene polymers and fatty acids; carriers such as clay and diatomaceous earth; thickeners such as carrageenan and modified cellulose; wetting, spreading, and dispersing agents; propellants in aerosol dispensers; microencapsulating agents; and emulsifiers. The term “inert” is not intended to imply nontoxicity; the ingredient may or may not be chemically active. Generally, EPA has exempted inert ingredients from the requirement of a tolerance based on the low toxicity of the individual inert ingredients.

Section 408(c)(2)(A)(i) of FFDCA allows EPA to establish an exemption from the requirement for a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the 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. . . .”

EPA establishes exemptions from the requirement of a tolerance only in those cases where it can be clearly demonstrated that the risks from aggregate exposure to pesticide chemical residues under reasonably foreseeable circumstances will pose no appreciable risks to human health. In order to determine the risks from aggregate exposure to pesticide inert ingredients, the Agency considers the toxicity of the inert in conjunction with possible exposure to residues of the inert ingredient through food, drinking water, and through other exposures that occur as a result of pesticide use in residential settings. If EPA is able to determine that a finite tolerance is not necessary to ensure that there is a reasonable certainty that no harm will result from aggregate exposure to the inert ingredient, an exemption from the requirement of a tolerance may be established.

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

EPA has evaluated the available toxicity data and considered their 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. Specific information on the studies received and the nature of the adverse effects caused by AAA as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies are discussed in the final rule published in the Federal Register of August 5, 2009 (74 FR 38935) (FRL-8430-1).

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 AAA used for human risk assessment is discussed in Unit IV of the final rule published in the Federal Register of August 5, 2009 (74 FR 38938) (FRL-8430-1).

1. Dietary exposure from food and feed uses. In evaluating dietary exposure to AAA, EPA considered exposure under the proposed exemption from the requirement of a tolerance. EPA assessed dietary exposures from AAA in food as follows:

i. Acute exposure. No adverse effects attributable to a single exposure of the AAAs was seen in the toxicity databases. Therefore, acute dietary risk assessments for the AAAs are not necessary.

ii. Chronic exposure. In conducting the chronic dietary exposure assessment, EPA used food consumption information from the U.S. Department of Agriculture (USDA) 1994 -1996 and 1998 Nationwide Continuing Surveys of Food Intake by Individuals (CSFII).

iii. Cancer. The Agency used a qualitative structure activity relationship (SAR) database, DEREK11, to determine if there were structural alerts suggestive of carcinogenicity. No structural alerts for carcinogenicity were identified. The AAAs are not expected to be carcinogenic. Therefore, a cancer dietary exposure assessment is not necessary to assess cancer risk.

2. Dietary exposure from drinking water. The Agency used screening level water exposure models in the dietary exposure analysis and risk assessment for the AAAs in drinking water.

3. From non-dietary exposure. The term “residential exposure” is used in this document to refer to nonoccupational, non-dietary exposure ( e.g., for lawn and garden pest control, indoor pest control, termiticides, and flea and tick control on pets). The AAAs may be used in inert ingredients in pesticide products that are registered for specific uses that may result in both indoor and outdoor residential exposures. A screening level residential exposure and risk assessment was completed for products containing the AAAs as inert ingredients.

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 AAA to share a common mechanism of toxicity with any other substances, and AAA does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that AAA 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 website 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. In the case of the lower weight AAA surfactants, there was no evidence of increased susceptibility to the offspring of rats following prenatal and postnatal exposure in the reproductive/developmental screening studies on several representative AAA surfactants. Decreased litter size and increased post-implantation loss were observed in one OPPTS Harmonized Guideline 870.3550 reproduction/developmental toxicity screening study at 470 mg/kg/day where maternal/paternal toxicity was manifested as one maternal death (GD 22), decreased body weight, bodyweight gain and food consumption and clinical signs (ptosis and hypoactivity) and microscopic changes in the testes (atrophy) and epididymides (increased intraluminal exfoliated spermatogenic cells) and dilated seminiferous tubules at the same dose (470 mg/kg/day). The maternal and offspring toxicity NOAEL was 168 mg/kg/day. The offspring toxicity in the OPPTS Harmonized Test Guideline 870.3650 study was manifested in the presence of more severe maternal toxicity (deaths), therefore, EPA concluded that there is no evidence of increased susceptibility in this study. In addition, there was no evidence of increased susceptibility in other submitted studies.

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 for the lower weight AAAs. (As discussed earlier, given the low toxicological concerns with the high weight AAAs, a safety factor analysis is unnecessary).

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, AAA is not expected to pose an acute risk.

2. Chronic risk. A chronic aggregate risk assessment takes into account exposure estimates from chronic dietary consumption of food and drinking water. Using the exposure assumptions discussed in this unit for chronic exposure the chronic dietary exposure from food and water to the AAAs is 11% of the cPAD for the U.S. population and 37% of the cPAD for children 1 to 2 years old, the most highly exposed population subgroup.

3. Short-term risk. Short-term aggregate exposure takes into account short-term residential exposure plus chronic exposure to food and water (considered to be a background exposure level).

AAAs are used as inert ingredients in pesticide products that are currently registered for uses that could result in short-term residential exposure and the Agency has determined that it is appropriate to aggregate chronic exposure through food and water with short-term residential exposures to the AAAs. EPA has concluded that the combined short-term aggregated food, water, and residential exposures result in aggregate MOEs of 110 for both adult males and females. Adult residential exposure combines high end indoor inhalation handler exposure with a high-end post application to pet exposures. EPA has concluded the combined short-term aggregated food, water, and residential exposures result in an aggregate MOE of 110 for children. Children's residential exposure includes total combined pet exposures. As the level of concern is for MOEs that are lower than 100, these MOEs are not of concern.

4. Intermediate-term risk. Intermediate-term aggregate exposure takes into account intermediate-term residential exposure plus chronic exposure to food and water (considered to be a background exposure level).

The AAAs are used as inert ingredients in pesticide products that are currently registered for uses that could result in intermediate-term residential exposure and the Agency has determined that it is appropriate to aggregate chronic exposure through food and water with intermediate-term residential exposures to the AAAs. EPA has concluded that the combined intermediate-term aggregated food, water, and residential exposures result in aggregate MOEs of 230 for both adult males and females, respectively. Adult residential exposure includes high-end post application dermal exposure from contact with treated pets. EPA has concluded that the combined intermediate-term aggregated food, water, and residential exposures result in an aggregate MOE of 110 for children. Children's residential exposure includes total combined pet exposure. As the level of concern is for MOEs that are lower than 100, these MOEs are not of concern.

5. Aggregate cancer risk for U.S. population. The Agency has not identified any concerns for carcinogenicity relating to the AAAs.

6. 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 residues of the lower weight AAAs. For the high molecular weight AAAs under 40 CFR 180.960. Since AAA conforms to the criteria that identify a low-risk polymer, there are no concerns for risks associated with any potential exposure scenarios that are reasonably foreseeable. Therefore, 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 residues of the high molecular weight AAAs.

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

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

The Codex has not established a MRL for AAAs.

Therefore, an exemption from the requirement of a tolerance is established for residues of the lower molecular weight α-alkyl-ω-hydroxypoly(oxypropylene) and/or poly (oxyethylene) polymers where the alkyl chain contains a minimum of 6 carbons, including oxirane, 2-methyl-, polymer with oxirane, monoundecyl ether, branched and linear (CAS Reg. No. 2222805-23-2) when used as an inert ingredient in pesticide formulations applied to pre- and post-harvest, applied to livestock, and used in antimicrobial formulations under 40 CFR 180.910, 40 CFR 180.930, and 40 CFR 180.940(a). In addition, an exemption from the requirement of a tolerance is established for residues of the larger molecular weight compounds of a-alkyl-w-hydroxypoly (oxypropylene) and/or poly (oxyethylene) polymers where the alkyl chain contains a minimum of 6 carbons, including oxirane, 2-methyl-, polymer with oxirane, monoundecyl ether, branched and linear (CAS Reg. No. 2222805-23-2) under 40 CFR 180.960.

This action establishes a tolerance 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 action has been exempted from review under Executive Order 12866, this action 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 action 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 action 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 action. In addition, this action does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act (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 (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:

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

You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. 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 Publishing Office's e-CFR site at http://www.ecfr.gov/cgi-bin/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-2018-0088 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before October 28, 2019. 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-2018-0088, 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.html. 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 July 24, 2018 (83 FR 34968) (FRL-9980-31), 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 7E8644) by IR-4, IR-4 Project Headquarters, Rutgers, The State University of New Jersey, 500 College Road East, Suite 201W, Princeton, NJ 08540. The petition requested that 40 CFR part 180 be amended by establishing tolerances for residues of emamectin, including its metabolites and degradates in or on the raw agricultural commodities: Artichoke, globe at 0.06 parts per million (ppm), Brassica, leafy greens, subgroup 4-16B at 0.050 ppm, Celtuce at 0.100 ppm, Cherry subgroup 12-12A at 0.10 ppm, Fennel, Florence at 0.100 ppm, Fruit, pome, group 11-10 at 0.025 ppm, Herb subgroup 19A at 0.50 ppm, Kohlrabi at 0.050 ppm, Leafy greens subgroup 4-16A at 0.100 ppm, Leaf petiole vegetable subgroup 22B at 0.100 ppm, Nut, tree, group 14-12 at 0.02 ppm, Vegetable, brassica, head and stem, group 5-16 at 0.050 ppm, and Vegetable, fruiting, group 8-10 at 0.020 ppm. The petition also proposed to amend 40 CFR 180.505 by removing the tolerances for residues of emamectin, including its metabolites and degradates, in or on the raw agricultural commodities: Fruit, pome, group 11 at 0.025 ppm, Nut, tree, group 14 at 0.02 ppm, Pistachio at 0.02 ppm, Turnip, greens at 0.050 ppm, Vegetable, leafy, except brassica, group 4 at 0.100 ppm, Vegetable, brassica, leafy, group 5 at 0.050 ppm, and Vegetable fruiting, group 8 at 0.020 ppm.

That document referenced a summary of the petition prepared by Syngenta, the registrant, which is available in the docket, http://www.regulations.gov. There were no comments received in response to the notice of filing.

In the Federal Register of August 24, 2018 (83 FR 42818) (FRL-9982-37), 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 7F8640) by Syngenta Crop Protection, LLC, P.O. Box 18300, Greensboro, NC 27419-8300. The petition requested that 40 CFR part 180 be amended by establishing a tolerance for residues of emamectin, including its metabolites and degradates in or on vegetable, cucurbit, group 9 at 0.03 ppm. That document referenced a summary of the petition prepared by Syngenta, 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 is establishing tolerances that vary from what the petitioner requested, as authorized under FFDCA section 408(d)(4)(A)(i). EPA's explanation for those variations are contained 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 emamectin including exposure resulting from the tolerances established by this action. EPA's assessment of exposures and risks associated with emamectin 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 main target organ for emamectin is the nervous system; treatment-related clinical signs (tremors, ptosis, ataxia, mydriasis, and hunched posture) and neuropathology (neuronal degeneration in the brain and in peripheral nerves and muscle fiber degeneration) were found in most of the emamectin studies in rats, dogs, rabbits, and mice. Decreased body weight was also a frequent finding.

Integral to the dose-response assessment in mammals for this class of compounds is the role of P-glycoprotein (P-gp) in target tissues. P-gp is a member of the adenosine triphosphate (ATP) binding cassette transporter protein class/group, which reside in the plasma membrane and function as a transmembrane efflux pump, moving xenobiotics from the intracellular to the extracellular domain. P-gp is found in the canalicular surface of hepatocytes, the apical surface of proximal tubular cells in the kidneys, brush border surface of enterocytes, luminal surface of blood capillaries of the brain (blood brain barrier), placenta, ovaries, and the testes. As an efflux transporter, P-gp acts as a protective barrier to keep xenobiotics out of the body by excreting them into bile, urine, and intestinal lumen, and prevents accumulation of these compounds in the brain and gonads, as well as in the fetus. Therefore, test animals with genetic polymorphisms that compromise P-gp expression are particularly susceptible to emamectin and abamectin induced neurotoxicity.

In this connection, some CF-1 mice have a polymorphism for the gene encoding P-gp and are either devoid (homozygous) or have diminished (heterozygous) levels of P-gp. These mice are found to be uniquely sensitive to the neurotoxic effects of emamectin and abamectin. In addition, the neonatal rat is also particularly sensitive to emamectin and abamectin as P-gp is undetectable in the neonatal rat brain. The first detection of P-gp is on post-natal day (PND) 7 and does not reach adult levels until approximately PND 28. As shown in the reproductive and DNT studies, neonatal rats are sensitive to the effects of abamectin-induced pup body weight reductions and death. In contrast, in the developing human fetus, the presence of P-gp was found as early as 22 weeks of gestation. Based on the difference in the ontogeny of P-gp in neonatal rats and human newborns, the Agency does not believe that the early post-natal findings in the rat are relevant to human newborns or young children, at this time.

The human multidrug resistance ( MDR-1 ) gene encoding P-gp and polymorphism of MDR-1 gene are well studied. The literature data are inconclusive with respect to the functional significance of the genetic variance in P-gp in humans. Currently, the reported cases of polymorphism of the MDR-1 gene in human populations have not been shown to result in a loss of P-gp function similar to that found in CF-1 mice. Given the ontogeny of P-gp and the lack of convincing evidence from the literature on human polymorphism of MDR-1 gene resulting in diminished P-gp function, the Agency considers the results of the studies with CF-1 mice not relevant for human health risk assessment. Therefore, the Agency is using results from toxicological studies conducted in the species that do not have diminished P-gp function for selecting toxicity endpoints and PODs for risk assessment. Among the test animals with fully functional P-gp, the beagle dog is the most sensitive species.

Emamectin did not elicit increased fetal sensitivity in developmental toxicity studies in rats and rabbits. In the reproductive toxicity study, emamectin produced neuronal degeneration in the brain and spinal in parental and offspring animals at similar dose level (1.8 mg/kg/day), and no increase in quantitative sensitivity was found in the pup with respect to the neurotoxicity. However, in the developmental neurotoxicity study in rats, there was an increase in both quantitative and qualitative sensitivity in the pups as no adverse effect was seen at the highest dose tested (3.6/2.5 mg/kg/day) in parental animals, while at 0.6 mg/kg/day, the pups showed a dose-related decrease in open field motor activity at post-natal day 17. Body tremors, hind-limb extension, and auditory startle were also observed in the high dose pups (3.6/2.5 mg/kg/day).

The carcinogenicity and mutagenicity studies provide no indication that emamectin is carcinogenic or mutagenic. Emamectin is classified as “not likely to be carcinogenic to humans.”

Specific information on the studies received and the nature of the adverse effects caused by emamectin 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 the document titled “ Emamectin (Emamectin Benzoate). Human Health Risk Assessment in Support of Establishing Permanent Tolerances on Globe Artichoke, Cherry Subgroup 12-12A, Herb Subgroup 19A, and Crop Group Conversions and Expansions to include Pome Fruit Group 11-10, Tree Nut Group 14-12, Brassica Vegetable Head and Stem Group 5-16, Brassica Leafy Greens Subgroup 4-16B, Leafy Greens Subgroup 4-16A, Leaf Petiole Vegetable Subgroup 22B, Fruiting Vegetable Group 8-10, and individual tolerances for Florence Fennel, Kohlrabi, Celtuce, and Cucurbit Vegetables Group 9” on pages 42-48 in docket ID number EPA-HQ-OPP-2018-0088.

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://www2.epa.gov/pesticide-science-and-assessing-pesticide-risks/assessing-human-health-risk-pesticides.

A summary of the toxicological endpoints for emamectin 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 emamectin, EPA considered exposure under the petitioned-for tolerances as well as all existing emamectin tolerances in 40 CFR 180.505. EPA assessed dietary exposures from emamectin 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 emamectin. In estimating acute dietary exposure, EPA used 2003-2008 food consumption information from the U.S. Department of Agriculture's National Health and Nutrition Examination Survey, What We Eat in America, (NHANES/WWEIA). As to residue levels in food, a refined acute assessment was conducted. The assessment relied upon percent crop treated (PCT) data, and a combination of monitoring data from the Pesticide Data Program (PDP) and field trial data. For hog meat, a tolerance level residue was assumed. For all other livestock commodities, anticipated residue values were used.

ii. Chronic exposure. In conducting the chronic dietary exposure assessment EPA used 2003-2008 food consumption data from the USDA's NHANES/WWEIA. As to residue levels in food, a refined chronic assessment was conducted. The assessment relied upon the same data as above, except for using mean field trial data for cottonseed, tree nuts, globe artichoke, cherry subgroup 12-12A, and herb subgroup 19A.

iii. Cancer. Based on the data summarized in Unit III.A., EPA has concluded that emamectin does not pose a cancer risk to humans. Therefore, a dietary exposure assessment for the purpose of assessing cancer risk is unnecessary.

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.

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, and 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:

Specific values used in the acute assessment for percent crop treated are: 10% almonds, 20% apples, 20% broccoli, 40% brussels sprouts, 25% cabbage, 20% cauliflower, 40% celery, 10% chicory, 2.5% cotton, 20% lettuce, 20% pears, 15% peppers, 2.5% pistachios, 10% spinach, 20% tomatoes, and 2.5% walnuts.

Specific values used in the chronic assessment for percent crop treated are: 2.5% almonds, 10% apples, 5% broccoli, 20% brussels sprouts, 10% cabbage, 5% cauliflower, 20% celery, 5% chicory, 10% lettuce, 5% pears, 5% peppers, 2.5% pistachios, 5% spinach, 15% tomatoes, and 2.5% walnuts.

In most cases, EPA uses available data from United States Department of Agriculture/National Agricultural Statistics Service (USDA/NASS), proprietary market surveys, and California Department of Pesticide Regulation (CalDPR) Pesticide Use Reporting (PUR) for the chemical/crop combination for the most recent 10 years. EPA uses an average PCT for chronic dietary risk analysis and a maximum PCT for acute dietary risk analysis. The average PCT figures for each existing use is derived by combining available public and private market survey data for that use, averaging across all observations, and rounding up to the nearest 5%, except for those situations in which the average PCT is less than 1% or less than 2.5%. In those cases, the Agency would use less than 1% or less than 2.5% as the average PCT value, respectively. The maximum PCT figure is the highest observed maximum value reported within the most recent 10 years of available public and private market survey data for the existing use and rounded up to the nearest multiple of 5%, except where the maximum PCT is less than 2.5%, in which case, the Agency uses less than 2.5% as the maximum PCT.

2. Dietary exposure from drinking water. The Agency used screening level water exposure models in the dietary exposure analysis and risk assessment for emamectin in drinking water. These simulation models take into account data on the physical, chemical, and fate/transport characteristics of emamectin. Further information regarding EPA drinking water models used in pesticide exposure assessment can be found at http://www2.epa.gov/pesticide-science-and-assessing-pesticide-risks/about-water-exposure-models-used-pesticide.

Based on the Pesticide in Water Calculator (PWC), the estimated drinking water concentrations (EDWCs) of emamectin for acute exposures are estimated to be 1.5 parts per billion (ppb) for surface water and EDWCs for chronic exposures are estimated to be 1.15 ppb for surface water. No groundwater concentrations are predicted for emamectin, as the model (PRZM-GW; pesticide root zone model—groundwater) indicates emamectin will not break through into groundwater over the 100-year course of the modeled scenario.

Modeled estimates of drinking water concentrations were directly entered into the dietary exposure model. For the acute dietary risk assessment, the water concentration value of 1.5 ppb was used to assess the contribution to drinking water and for the chronic dietary risk assessment, the water concentration of value 1.15 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).

Residential exposures are not anticipated from the proposed uses of emamectin, nor are they anticipated from existing uses of emamectin since they are agricultural uses, restricted use products ( i.e., restricted to use by certified applicators only), or are limited to non-residential areas ( i.e., commercial and industrial areas) with the exception of a gel bait product. The ready-to-use (RTU) gel bait product is registered for use in multiple locations, including in residential areas. As the RTU product requires no mixing/loading, the only potential for residential handler exposure is via application. When applying this product according to use directions, bait points and bait beads are intended to be placed in cracks and crevices where direct contact by adults is anticipated to be negligible. Post-application exposures for adults and children are also unlikely due to the nature of the application method, and the location of the bait placement. Therefore, a residential exposure assessment has not been conducted and there are no residential risk estimates recommended for use in the aggregate risk assessment for emamectin.

4. Cumulative effects from substances with a common mechanism of toxicity. The Agency is required to consider the cumulative risks of chemicals sharing a common mechanism of toxicity. In 2016, EPA's Office of Pesticide Programs released a guidance document entitled Pesticide Cumulative Risk Assessment: Framework for Screening Analysis ( https://www.epa.gov/pesticide-science-and-assessing-pesticide-risks/pesticide-cumulative-risk-assessment-framework ). This document provides guidance on how to screen groups of pesticides for cumulative evaluation using a two-step approach beginning with the evaluation of available toxicological information and if necessary, followed by a risk-based screening approach. This framework supplements the existing guidance documents for establishing common mechanism groups (CMGs) and conducting cumulative risk assessments (CRA).

The Agency has utilized this framework for abamectin and determined that abamectin along with emamectin form a candidate CMG of the avermectin macrocyclic lactones. This group of pesticides is considered a candidate CMG because they share characteristics to support a testable hypothesis for a common mechanism of action and while there are sufficient toxicological data to suggest a common pathway, there are not adequate data to establish those key events in a pathway as described in the mode of action/adverse outcome pathway (MOA/AOP) framework ( e.g., lack of dose or temporal concordance of proposed key events).

In 2017, the Agency conducted a screening-level cumulative exposure analysis consistent with the guidance described in the cumulative screening framework. The screening-level cumulative assessment for the avermectin macrocyclic lactones, abamectin and emamectin, indicated that cumulative aggregate dietary and residential exposures for abamectin and emamectin were below the Agency's levels of concern.

Based upon updated use information ( i.e., new uses), the Agency has updated its screening-level cumulative exposure analysis for the avermectin macrocyclic lactones, including abamectin and emamectin. This updated screening-level cumulative exposure assessment for the avermectin macrocyclic lactones, abamectin and emamectin, indicated that that cumulative aggregate dietary and residential exposures for abamectin and emamectin were below the Agency's levels of concern. The screening memo, titled “ Avermectin Macrocyclic Lactones, Abamectin and Emamectin. Cumulative Screening Risk Assessment” can be found in docket ID number EPA-HQ-OPP-2018-0088 at http://www.regulations.gov.

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. Emamectin did not elicit increased fetal sensitivity in developmental toxicity studies in rats and rabbits. In the reproductive toxicity study, emamectin produced neuronal degeneration in the brain and spinal cord in parental and offspring animals at a similar dose level (1.8 mg/kg/day), and no increase in quantitative sensitivity was found in the pup with respect to the neurotoxicity. However, in the developmental neurotoxicity study in rats, there was an increase in both quantitative and qualitative sensitivity in the pups as no adverse effect was seen at the highest dose tested (3.6/2.5 mg/kg/day) in parental animals, while at 0.6 mg/kg/day, the pups showed a dose-related decrease in open field motor activity at post-natal day 17. Body tremors, hind-limb extension, and auditory startle were also observed in the high dose pups (3.6/2.5 mg/kg/day).

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:

i. The toxicity database for emamectin is complete.

ii. The proposed MOA is interaction with GABA receptors leading to neurotoxicity. The clinical signs observed in the emamectin database are consistent with the proposed MOA. Following emamectin exposure, neurotoxicity has been seen across multiple studies and species of test animals. Neurotoxic effects seen in various studies are consistent with the MOA of emamectin, and the selected toxicity endpoints and POD is protective of the neurotoxic effects in the data.

iii. As discussed above, the developmental neurotoxicity study showed an increase in both quantitative and qualitative sensitivity in the pups as indicated by a dose-related decrease in open field motor activity at post-natal day 17 at 0.6 mg/kg/day. Body tremors, hind-limb extension, and auditory startle were also observed in the high dose pups (2.5 mg/kg/day), while no adverse effects were seen in the parental animals at the highest tested dose (3.6 mg/kg/day). However, the toxicity endpoint and POD (0.25 mg/kg/day) selected for risk assessment are protective of the effects seen in the pups.

iv. There are no residual uncertainties for emamectin with respect to the exposure databases. Although the dietary exposure estimates are partially refined, anticipated residue estimates for most commodities were derived from field trials which are still considered conservative since field trials are conducted under maximum use conditions (maximum allowed application rate and number of applications, minimum pre-harvest interval, etc.). Monitoring data were used for apples in the acute assessment since apple juice had a significant impact on exposure. EPA made conservative (protective) assumptions in the ground and surface water modeling used to assess exposure to emamectin in drinking water. There are no anticipated exposures to residential handlers, or for post-application exposure of adults and children. These assessments will not underestimate the exposure and risks posed by emamectin.

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 emamectin will occupy 26% of the aPAD for children 1 to 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 emamectin from food and water will utilize 3.4% of the cPAD for children 1 to 2 years old, the population group receiving the greatest exposure. Based on the explanation in Unit III.C.3., regarding residential use patterns, chronic residential exposure to residues of emamectin is not expected.

3. Short-term risk. A short-term adverse effect was identified; however, emamectin is not registered for any use patterns that would result in short-term residential exposure. Short-term risk is assessed based on short-term residential exposure plus chronic dietary exposure. Because there is no short-term residential exposure and chronic dietary exposure has already been assessed under the appropriately protective cPAD (which is at least as protective as the POD used to assess short-term risk), no further assessment of short-term risk is necessary, and EPA relies on the chronic dietary risk assessment for evaluating short-term risk for emamectin.

4. Intermediate-term risk. An intermediate-term adverse effect was identified; however, emamectin is not registered for any use patterns that would result in intermediate-term residential exposure. Intermediate-term risk is assessed based on intermediate-term residential exposure plus chronic dietary exposure. Because there is no intermediate-term residential exposure and chronic dietary exposure has already been assessed under the appropriately protective cPAD (which is at least as protective as the POD used to assess intermediate-term risk), no further assessment of intermediate-term risk is necessary, and EPA relies on the chronic dietary risk assessment for evaluating intermediate-term risk for emamectin.

5. Aggregate cancer risk for U.S. population. Based on the lack of evidence of carcinogenicity in two adequate rodent carcinogenicity studies, emamectin is not expected to pose a cancer risk to humans.

6. 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 emamectin residues.

Adequate methods (Method 244-92-3 and Method 244-92-3, Revision 1) are available for the enforcement of tolerances on plants. The methods determine residues of emamectin and its regulated isomers and degradates/metabolites using high performance liquid chromatography with fluorescence detection (HPLC/FLD).

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.

The Codex has established MRLs for emamectin on various commodities that are different than the tolerances established for emamectin in the United States.

The U.S. and Codex residue definitions are not harmonized. The U.S. residue definition for emamectin includes the sum of emamectin and its metabolites (8,9-isomer) for plants and livestock. The Codex residue definition includes only emamectin for plants and livestock commodities.

Codex has MRLs for residues of emamectin on tomato, tomatillo, bell pepper, and non-bell pepper, the representative commodities of the fruiting vegetable group 8-10 at 0.02 ppm each. The U.S. tolerance at 0.02 ppm for residues on crop group 8-10 is being harmonized with these Codex MRLs.

Codex has an MRL for residues of emamectin on mustard greens, the representative commodity for Brassica leafy greens subgroup 4-16B at 0.2 ppm. The U.S. tolerance on subgroup 4-16B is being harmonized with Codex mustard greens, the representative commodity, at 0.20 ppm.

Codex has MRLs for residues of emamectin on head lettuce at 1 ppm and leaf lettuce at 0.7 ppm. The current U.S. tolerance is 0.1 ppm for subgroup 4-16A, which has head lettuce, leaf lettuce, and spinach as the representative commodities. EPA is therefore harmonizing the tolerance for subgroup 4-16A with Codex head lettuce at 1 ppm.

Codex has MRLs for apple and pear at 0.02 ppm each. EPA harmonizing the tolerance on pome fruit, group 11-10 with these MRLs at 0.02 ppm.

For tree nut crop group 14-12, the Codex MRLs for residues on the representative commodities of this group is 20x lower than the U.S. tolerances being established in this rulemaking. Lowering the tolerance could cause U.S. growers to have violative residues when following label instructions; therefore, EPA is not harmonizing the tolerance with the Codex MRLs.

For all other commodities, Codex does not have established MRLs.

For new uses on globe artichoke, herb subgroup 19A, and cherry subgroup 12-12A, the tolerances differ slightly from those proposed by IR-4 due to differences in calculating parent equivalents of emamectin metabolites from the residue data.

The currently established tolerance on crop group 11 and the proposed tolerance on crop group 11-10 are both at 0.025 ppm. The tolerance for pome fruit crop group 11-10 is being established at 0.02 ppm to harmonize with Codex MRLs on apple and pear.

The tolerance on Brassica leafy greens subgroup 4-16B is being set at 0.2 ppm instead of the proposed level at 0.050 ppm and the tolerance on leafy greens subgroup 4-16A is being set at 1 ppm instead of 0.1 ppm to harmonize with Codex.

For the proposed tolerance on fennel, Florence, the commodity definition was corrected to be Fennel, florence, fresh leaves and stalk.

For the other commodities and crop groups, the tolerances differ from the petitioned-for tolerances due to the use of HED rounding class practice.

The proposed tolerance for emamectin on vegetable, cucurbit, group 9 at 0.03 ppm is not necessary because the available data support the existing tolerance of 0.02 ppm for that crop group.

Therefore, tolerances are established for residues of emamectin, including its metabolites and degradates in or on the raw agricultural commodities Artichoke, globe at 0.05 ppm; Brassica, leafy greens, subgroup 4-16B at 0.2 ppm; Celtuce at 0.1 ppm; Cherry subgroup 12-12A at 0.09 ppm; Fennel, florence, fresh leaves and stalk at 0.1 ppm; Fruit, pome, group 11-10 at 0.02 ppm; Herb subgroup 19A at 0.4 ppm; Kohlrabi at 0.05 ppm; Leaf petiole vegetable subgroup 22B at 0.1 ppm; Leafy greens subgroup 4-16A at 1 ppm; Nut, tree, group 14-12 at 0.02 ppm; Vegetable, brassica, head and stem, group 5-16 at 0.05 ppm; and Vegetable, fruiting, group 8-10 at 0.02 ppm.

Additionally, the following existing tolerances are removed as unnecessary due to the establishment of the above tolerances: Fruit, pome, group 11 at 0.025; Nut, tree, group 14 at 0.02 ppm; Pistachio at 0.02 ppm; Turnip, greens at 0.050 ppm; Vegetable, brassica, leafy, group 5 at 0.050 ppm; Vegetable fruiting, group 8 at 0.020 ppm; and Vegetable, leafy, except brassica, group 4 at 0.100 ppm.

This action 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 action has been exempted from review under Executive Order 12866, this action 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), nor is it considered a regulatory action under Executive Order 13771, entitled “Reducing Regulations and Controlling Regulatory Costs” (82 FR 9339, February 3, 2017). This action 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 tolerances 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 action 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 action. In addition, this action does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act (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 (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 Third Report and Order, FCC 19-80, adopted on August 1, 2019. The full text is available for public inspection and copying during regular business hours in the FCC Reference Center, Federal Communications Commission, 445 12th Street SW, Room CY-A257, Washington, DC 20554. This document will also be available via ECFS at https://docs.fcc.gov/public/attachments/FCC-19-80A1.docx. Documents will be available electronically in ASCII, Microsoft Word, and/or Adobe Acrobat. The complete text may be purchased from the Commission's copy contractor, 445 12th Street SW, Room CY-B402, Washington, DC 20554. Alternative formats are available for people with disabilities (Braille, large print, electronic files, audio format), by sending an email to fcc504@fcc.gov or calling the Commission's Consumer and Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-0432 (TTY).

1. In this Third Report and Order (Third Order), we interpret sections of the Communications Act of 1934, as amended (the Act) that govern how local franchising authorities (LFAs) may regulate cable operators and cable television services, with specific focus on issues remanded from the United States Court of Appeals for the Sixth Circuit (Sixth Circuit) in Montgomery County, Md. et al. v. FCC.

2. Every LFA as well as every “cable operator” that offers “cable service” must comply with the cable franchising provisions of Title VI of the Act. Section 621(b)(1) prohibits a cable operator from providing cable service without first obtaining a cable franchise, while section 621(a)(1) circumscribes the power of LFAs to award or deny such franchises. In addition, section 622 allows LFAs to charge franchise fees and sets the upper boundaries of those fees. Notably, section 622 caps the fee at five percent of a “cable operator's gross revenues derived . . . from the operation of the cable system to provide cable service.”  1 When Congress initially adopted these sections in 1984, it explained that it was setting forth a federal policy to “define and limit the authority that a franchising authority may exercise through the franchise process.” Congress also expressly preempted any state or local laws or actions that conflict with those definitions and limits. 2

3. As summarized in detail in the Second Further Notice of Proposed Rulemaking (FNPRM) (83 FR 51911, Oct. 15, 2018), the Commission has an extensive history of rulemakings and litigation interpreting sections 621 and 622. In short, the Commission in 2007 released a First Report and Order (72 FR 13189, March 21, 2007) to provide guidance about terms and conditions in local franchise agreements that are unreasonable under section 621 of the Act with respect to new entrants' franchise agreements. 3 Two major conclusions that the Commission adopted are that (1) non-cash, “in-kind” contributions from cable operators to franchise authorities are franchise fees that count toward the statutory cap of five percent of cable operator revenue, and (2) franchising authorities may not use their cable franchising authority to regulate non-cable services (like telephone and broadband services) that the new entrants deliver over their mixed-use networks ( i.e., networks that carry broadband services, voice services, and other non-cable services, in addition to video programming services). The Commission also sought comment on whether to extend those conclusions to agreements that LFAs have with incumbent cable operators, and ultimately decided in a Second Report and Order (72 FR 65670, Nov. 23, 2007) and an Order on Reconsideration (80 FR 12088, Mar. 6, 2015) that those conclusions should apply to incumbent cable operators.

4. In Montgomery County, the Sixth Circuit addressed challenges by LFAs to the Second Report and Order and the Order on Reconsideration. 4 The court agreed that in-kind ( i.e., non-cash) contributions are franchise fees as defined by section 622(g)(1), noting that section 622(g)(1) defines “franchise fee” to include “any tax, fee, or assessment of any kind” and that the terms “tax” and “assessment” can include nonmonetary exactions. The court found, however, that the fact that the term franchise fee can include in-kind contributions “does not mean that it necessarily does include every one of them.” The court concluded that the Commission failed to offer any explanation in the Second Report and Order or in the Order on Reconsideration as to why section 622(g)(1) allows it to treat cable-related, “in-kind” exactions—such as free or discounted cable services or obligations related to PEG channels—as franchise fees. 5 LFAs had claimed that the Commission's interpretation would limit LFAs' ability to enforce their statutory authority to require cable operators to dedicate channel capacity for PEG use and to impose build-out obligations in low-income areas, and the court noted that the Commission's orders did not reflect any consideration of this concern. The court also stated that the Commission failed to define what “in-kind” means. The court therefore vacated as arbitrary and capricious the Second Report and Order and the Order on Reconsideration to the extent that they treat cable-related, in-kind exactions as franchise fees under section 622(g)(1). The court directed the Commission to determine and explain on remand to what extent cable-related, in-kind contributions are franchise fees under the Act.

5. The court in Montgomery County also agreed with LFAs that neither the Second Report and Order nor the Order on Reconsideration offered a valid statutory basis for the Commission's application of its prior “mixed-use ruling” to incumbent cable operators. 6 Under the mixed-use rule, “LFAs' jurisdiction applies only to the provision of cable services over cable systems” and “an LFA may not use its video franchising authority to attempt to regulate a LEC's entire network beyond the provision of cable services.” The court stated that the Commission's decision in the First Report and Order to apply the mixed-use rule to new entrants had been defensible because section 602(7)(C) of the Act expressly states that LFAs may regulate Title II carriers only to the extent that they provide cable services and the Commission found that new entrants generally are Title II carriers. The court observed that in extending the mixed-use rule to incumbent cable operators in the Second Report and Order, the Commission merely relied on the First Report and Order's interpretation of section 602(7)(C), noting that section 602(7)(C) “does not distinguish between incumbent providers and new entrants.” The court found, however, that this reasoning is not an affirmative basis for the Commission's decision in the Second Report and Order to apply the mixed-use rule to incumbent cable operators because section 602(7)(C) by its terms applies only to Title II carriers and “many incumbent cable operators are not Title II carriers.” The court further found that the Order on Reconsideration did not offer any statutory basis for the Commission's decision to extend the mixed-use rule to incumbent cable operators. Accordingly, the court concluded that the Commission's extension of the mixed-use rule to incumbent cable operators that are not common carriers was arbitrary and capricious. The court vacated the mixed-use rule as applied to those incumbent cable operators and remanded for the Commission “to set forth a valid statutory basis, if there is one, for the rule as so applied.”

6. The Commission in September 2018 issued the Second FNPRM to address the issues raised by the remand from the Sixth Circuit in Montgomery County.

7. We largely adopt our tentative conclusions in the Second FNPRM. 7 First, we conclude that cable-related, in-kind contributions required by LFAs from cable operators as a condition or requirement of a franchise agreement are franchise fees subject to the statutory five percent cap on franchise fees set forth in section 622 of the Act. We find that the Act exempts capital contributions associated with the acquisition or improvement of a PEG facility from this definition and remind LFAs that under the Act they may only require “adequate” PEG access channel capacity, facilities, or financial support. Second, we find that our mixed-use rule applies to incumbent cable operators. Third, we find that the Act preempts any state or local regulation of a cable operator's non-cable services that would impose obligations on franchised cable operators beyond what Title VI of the Act allows. Finally, we decide that our guidance related to the local franchising process in this docket also will apply to state-level franchising actions and state regulations that impose requirements on local franchising.

8. Section 622 of the Act contains a broad definition of franchise fees. For the reasons provided below, we find that most cable-related, in-kind contributions are encompassed within this definition and thus must be included for purposes of calculating the statutory five percent cap on such fees. In this section, we first explain our interpretation of section 622 and why the definition of franchise fees includes most cable-related, in-kind contributions. We then explain how our interpretation applies to certain common franchise agreement terms. Lastly, we explain the process that LFAs and cable operators should use to amend their franchise agreements to conform to this Order.

9. Addressing the first issue raised by the remand from the Sixth Circuit in Montgomery County, we adopt our tentative conclusion that we should treat cable-related, in-kind contributions  8 required by LFAs from cable operators as a condition or requirement of a franchise agreement as franchise fees subject to the statutory five percent cap set forth in section 622 of the Act, with limited exceptions as described herein. We also adopt our tentative conclusion that this treatment of cable-related, in-kind contributions should be applied to both new entrants and incumbent cable operators. As explained below, we find that this interpretation is consistent with the statutory language and legislative history.

10. Section 622 of Title VI, entitled “Franchise fees,” governs cable operator obligations with respect to franchise fees. Specifically, section 622(a) states that any cable operator may be required under the terms of any franchise agreement to pay a franchise fee, and section 622(b) sets forth the limitation that “[f]or any twelve-month period, the franchise fees paid by a cable operator with respect to any cable system shall not exceed 5 percent of such cable operator's gross revenues derived in such period from the operation of the cable system to provide cable services.” Notably, section 622(g) defines the term “franchise fee” for purposes of this section.

11. To understand what types of contributions from cable operators are franchise fees subject to the five percent statutory cap, the key provision is the section 622(g) definition, which states that “the term `franchise fee' includes any tax, fee, or assessment of any kind imposed by a franchising authority or other governmental entity on a cable operator or cable subscriber, or both, solely because of their status as such,” subject to certain enumerated exceptions. Specifically, according to the definition, the term “franchise fee” does not include the following: (1) Any tax, fee, or assessment of general applicability;  9 (2) in the case of any franchise in effect on October 30, 1984, payments which are required by the franchise to be made by the cable operator during the term of such franchise for, or in support of the use of, PEG access facilities; (3) in the case of any franchise granted after October 30, 1984, capital costs which are required by the franchise to be incurred by the cable operator for PEG access facilities; (4) requirements or charges incidental to the awarding or enforcing of the franchise, including payments for bonds, security funds, letters of credit, insurance, indemnification, penalties, or liquidated damages;  10 or (5) any fee imposed under Title 17. 11 Because Congress spoke directly to the issue of what constitutes a franchise fee in section 622(g), our analysis of whether cable-related, in-kind exactions are included in the franchise fee is appropriately focused on this statutory language.

12. As a preliminary matter, we note our prior finding, which was upheld by the Sixth Circuit in Montgomery County, that the franchise fee definition in section 622(g) can encompass both monetary payments imposed by a franchising authority or other governmental entity on a cable operator, as well as “in-kind” payments— i.e., payments consisting of something other than money, such as goods and services  12 —that are so imposed. 13 The definition of “franchise fee” in section 622(g)(1) broadly covers “any tax, fee, or assessment of any kind imposed by a franchising authority or other governmental entity on a cable operator . . . solely because of [its] status as such.” Because the statute does not define the terms “tax,” “fee,” or “assessment,” we look to the ordinary meaning of such terms. 14 As the court explained in Montgomery County, the definitions of the terms “tax” and “assessment,” in particular, “can include noncash exactions.” Further, as the court observed, section 622(g)(1) “more specifically defines `franchise fee' to include `any tax, fee, or assessment of any kind[,]' . . . which requires us to give those terms maximum breadth.” Thus, consistent with the court's conclusion on this issue, the term franchise fee in section 622(g)(1) includes non-monetary payments. We, therefore, reject arguments that it should be construed to cover only monetary payments. 15

13. As the court noted in Montgomery County, “that the term `franchise fee' can include noncash exactions, of course, does not mean that it necessarily does include every one of them.” As such, the next step in our analysis is to evaluate specifically whether cable-related, in-kind contributions are included within the franchise fees. The Commission previously determined that in-kind contributions unrelated to the provision of cable service are franchise fees subject to the statutory five percent cap, and the court's decision in Montgomery County upheld this interpretation. 16 In making this determination, the Commission pointed to examples in the record where LFAs demanded in-kind contributions unrelated to the provision of cable services in the context of franchise negotiations, and it explained that such requests do not fall within any of the exempted categories in section 622(g)(2) and thus should be considered a franchise fee under section 622(g)(1). 17

14. We find that there is no basis in the statute for exempting all cable-related, in-kind contributions for purposes of the five percent franchise fee cap or for distinguishing between cable-related, in-kind contributions and in-kind contributions unrelated to the provision of cable services. As noted above, the section 622(g)(1) franchise fee definition broadly covers “any tax, fee, or assessment of any kind,” and we conclude that cable-related, in-kind contributions fall within this definition. There is nothing in this language that limits in-kind contributions included in the franchise fee. In fact, Congress specified that the definition covers “any” tax, fee, or assessment “of any kind,” which means those terms should be interpreted expansively and given “maximum breadth.”  18

15. Further, there is no general exemption for cable-related, in-kind contributions in the five excluded categories listed in section 622(g)(2). Only two of the exclusions encompass two very specific kinds of cable-related, in-kind contributions, but not all such contributions generally. In particular, section 622(g)(2)(B) excludes payments required by the franchise to be made by the cable operator for, or in support of the use of, PEG access facilities (for franchises in effect on October 30, 1984), and section 622(g)(2)(C) excludes capital costs which are required by the franchise to be incurred by the cable operator for PEG access facilities (for franchises granted after October 30, 1984). We agree with ACA that the structure of the relevant statutory provision is “straightforward,” providing a broad definition of franchise fee, “then expressly provid[ing] a limited number of exceptions to this definition, none of which is so broad as to include all cable-related, in-kind contributions.”  19

16. Moreover, the fact that Congress carved out specific exceptions to the franchise fee definition for certain PEG-related contributions bolsters the conclusion that Congress did not intend to establish a general exemption for all cable-related, in-kind contributions from treatment as franchise fees. Because support for PEG access facilities and PEG capital costs fall within the broader category of cable-related, in-kind contributions, Congress would not have needed to craft these narrow exceptions if all cable-related, in-kind contributions generally were exempted. We disagree with the contention that the specific exceptions in section 622(g)(2) were intended to address only “payments that otherwise might be considered franchise fees,” and that “[o]ther cable-related obligations were not considered `fees' to begin with, let alone payments that required a specific exemption.” This argument erroneously constricts the definition of franchise fees to apply only to “fees,” while the statute more broadly includes “any tax, fee, or assessment of any kind.” Further, we believe it is more consistent with the statutory text and structure to construe the exceptions as carve-outs from a broader definition that sweeps in all cable-related, in-kind contributions. 20

17. While the statutory text is alone sufficient to support our conclusion, we also find that the legislative history supports our position that cable-related, in-kind contributions are franchise fees subject to the five percent cap. As we observed in the Second FNPRM, we see no basis in the legislative history for distinguishing between in-kind contributions unrelated to the provision of cable services and cable-related, in-kind contributions for purposes of the five percent franchise fee cap. 21 Further, we see no basis in the legislative history to treat in-kind payments differently from monetary payments for purposes of determining what is a franchise fee. The legislative history, in discussing what constitutes a franchise fee, refers to the definition in section 622(g)(1), which “include[s] any tax, fee, or assessment imposed on a cable operator or subscribers solely because of their status as such,” and it makes no distinction between cable-related contributions and those unrelated to cable services, nor between monetary and non-monetary payments. The legislative history then elaborates on the specific exemptions in section 622(g)(2) and, in particular, notes that “[s]pecific exemptions from the franchise fee limitations are included for certain payments related to public, educational and governmental access.” It specifies that, “[f]or existing franchises, a city may enforce requirements that additional payments be made above the 5 percent cap to defray the cost of providing public, educational and governmental access, including requirements related to channels, facilities and support necessary for PEG use.” Because Congress limited this exception to then-existing franchises, this provision elucidates Congress' intent that contributions in support of PEG access—which are cable-related, in-kind contributions—are subject to the five percent cap for franchises granted after the 1984 Cable Act. 22

18. We disagree with commenters who cite to a portion of the legislative history as evidence of Congress' intent that franchise fees include only monetary payments made by cable operators. Specifically, LFA commenters cite a statement in the discussion of subsection 622(g)(2)(C), which excludes certain PEG-related capital costs from the franchise fee definition, that “[i]n general, this section defines as a franchise fee only monetary payments made by the cable operator, and does not include as a `fee' any franchise requirements for the provision of services, facilities or equipment.” LFA commenters' reading of this statement is inconsistent with the overall text and structure of section 622(g). 23 Section 622(g)(1) “specifically defines `franchise fee' to include `any tax, fee, or assessment of any kind[,]' ” subject to certain enumerated exclusions, and the court in Montgomery County was clear that this statutory language “requires us to give those terms maximum breadth.” The Commission has already concluded, and the Sixth Circuit has twice upheld, that non-monetary payments can be franchise fees. Further, this reading would render section 622(g)(2)(C) superfluous because there would not need to be an exemption for PEG-related in-kind contributions if non-monetary contributions were not franchise fees in the first place.

19. Because we believe that the pertinent statutory provision in section 622(g) supports our conclusion that cable-related, in-kind contributions are franchise fees, we reject arguments raised by franchise authorities that other Title VI provisions should be read to exclude costs that are clearly included by the franchise fee definition. Instead of focusing on the key definition of “franchise fee” as “any tax, fee, or assessment of any kind” subject to certain enumerated exceptions, LFA commenters cite to other parts of the statute which, they argue, evince Congress' intent to exclude cable-related, in-kind contributions from the statutory cap on franchise fees. We reject each of these arguments in turn below.

20. First, we affirm our tentative conclusion that treating cable-related, in-kind contributions as franchise fees would not undermine the provisions in the Act that authorize or require LFAs to impose cable-related obligations on franchisees. For example, section 611(b) of the Act permits LFAs to require that channel capacity be designated for PEG use and that channel capacity on I-Nets be designated for educational and governmental use. Anne Arundel County et al. argue that the Commission errs by not acknowledging that the Cable Act “authorize[s] LFAs to both impose cable franchise obligations [in section 611] and collect franchise fees [in section 622]—they do not offset each other.” However, as we observed in the Second FNPRM, the fact that the Act authorizes LFAs to impose such obligations does not mean that the value of these obligations should be excluded from the five percent cap on franchise fees. We agree with NCTA and ACA that there is no basis in the statutory text for concluding that the authority provided in section 611(b) affects the definition of franchise fee in section 622(g). As explained above, section 622(g) is the key provision that defines what is included in the franchise fee, and section 622(g)(2) carves out only limited exclusions for PEG-related costs and makes no mention of an I-Net-related exclusion. Since Congress enacted the PEG and I-Net provisions at the same time it added the franchise fee provisions, it could have explicitly excluded all costs related to PEG and I-Nets if it had intended they not count toward the cap. 24 Instead, they just excluded a subset of those costs. Further, if we were to interpret the statute such that all costs related to PEG, I-Nets, or other requirements imposed in section 611 are excluded from treatment as franchise fees because section 611(b) contemplates that such costs be incurred, the specific exemption for PEG capital costs in section 622(g)(2)(D) would be superfluous. While we acknowledge that PEG channels and I-Nets provide benefits to consumers, such benefits cannot override the statutory framework, which carves out only limited exclusions from franchise fees.

21. Next, we do not find persuasive the argument that section 626 of the Act “reflects the fact that cable-related franchise requirements are not franchise fees.” Section 626 directs franchising authorities to consider, among other things, whether a cable operator's franchise renewal proposal “is reasonable to meet the future cable-related community needs and interests, taking into account the cost of meeting such needs and interests.” NATOA et al. contend that if cable-related, in-kind requirements are included as franchise fees, “it would be the LFA who pays for them, rendering the cost consideration in this Section obsolete.” We disagree with this reasoning. As NCTA explains, “[t]he cost/benefit analysis required under this provision underscores that Congress intended franchising authorities to balance the desire for any in-kind exactions requested by parties in the renewal process against the overall franchise fee burdens on cable operators and subscribers.” The section 626 assessment does not lose its purpose if cable-related, in-kind contributions are counted as franchise fees; as part of this assessment, for example, a franchising authority could determine that cable-related community needs and interests can be met at a lower cost to cable subscribers than the full five percent franchise fee. 25 Moreover, the community needs assessment in section 626 also accounts for items that are not in-kind contributions subject to the franchise fee cap, such as build-out requirements. 26

22. Finally, we disagree with commenters that cite a provision in section 622 that relates to itemization on customer bills as evidence that Congress did not intend PEG-related franchise obligations to be included in franchise fees. In particular, LFA commenters point to section 622(c)(1), which specifies that cable operators may identify as a separate line item on each subscriber bill each of the following: (1) The amount of the total bill assessed as a franchise fee and the identity of the franchising authority to which the fee is paid; (2) the amount of the total bill assessed to satisfy any requirements imposed on the cable operator by the franchise agreement to support PEG channels or the use of such channels; and (3) the amount of any other fee, tax, assessment, or charge of any kind imposed by any governmental authority on the transaction between the operator and the subscriber. LFA commenters argue that “[t]hrough this language, Congress clearly outlined a separation between franchise fees and cable-related, in-kind fees.” On the contrary, “the fact that Section 622(c) allows cable operators to itemize certain charges on subscriber bills has no bearing on which charges meet the definition of franchise fees under Section 622(g).” While section 622(g) was adopted as part of the 1984 Cable Act, Congress adopted section 622(c) years later in 1992 to promote transparency by allowing cable operators to inform subscribers about how much of their total bill is made of charges imposed by local governments through the franchising process. By differentiating the types of charges that can be itemized on subscriber bills, there is no indication that Congress intended to exclude certain charges from the franchise fee. 27

23. Having established our interpretation of section 622(g), we adopt our tentative conclusion that this treatment of cable-related, in-kind contributions should be applied to both new entrants and incumbent cable operators. As the Commission has previously observed, section 622 “does not distinguish between incumbent providers and new entrants.” We affirm our belief that applying the same treatment of cable-related, in-kind contributions to both new entrants and incumbent cable operators will ensure a more level playing field and that the Commission should not place its thumb on the scale to give a regulatory advantage to any competitor.

24. We disagree with the contention that our interpretation of the franchise fee definition in section 622(g) is impermissible under Chevron. 28 Charles County, Maryland posits that “[b]ecause Congress has directly addressed the questions at issue by employing precise, unambiguous statutory language in section 622 of the Act, the FCC's proposed rules re-imagining . . . what constitutes a `franchise fee' are impermissible,” as “[o]nly Congress may alter or amend federal law.” Charles County does not offer an explanation for why the statutory language is unambiguous beyond arguing that the words “tax, fee, or assessment” in the definition are terms of art. But regardless of whether these are terms of art, they can include non-monetary contributions, as the Sixth Circuit observed. And we believe that our interpretation of this language using traditional tools of statutory construction is a reasonable and permissible construction of the statute that effectuates Congressional intent for the reasons set forth above. 29 Indeed, it is the interpretation that is most consistent with the plain meaning of the statutory definition of franchise fee.

25. In this section, we analyze whether specific types of cable-related, in-kind contributions are franchise fees subject to the five percent statutory cap under section 622. First, we find that costs attributable to franchise terms that require free or discounted cable service to public buildings are franchise fees, consistent with our tentative conclusion that treating all cable-related, in-kind contributions as franchise fees unless expressly excluded would best effectuate the statutory purpose. Next, we adopt our tentative conclusion that costs in support of PEG access are franchise fees, with the exception of capital costs as defined below. Similarly, we find that costs attributable to construction of I-Nets are franchise fees. Finally, we conclude that build-out and customer service requirements do not fall within the statutory definition of franchise fee. Based on these conclusions with respect to specific types of costs, we adopt a definition of “in-kind, cable-related contributions” to include “any non-monetary contributions related to the provision of cable services provided by cable operators as a condition or requirement of a local franchise, including but not limited to free or discounted cable service to public buildings, costs in support of PEG access other than capital costs, and costs attributable to the construction of I-Nets. It does not include the costs of complying with build-out and customer service requirements.”  30

26. We find that costs attributable to franchise terms that require a cable operator to provide free or discounted cable service to public buildings, including buildings leased by or under control of the franchise authority, are cable-related, in-kind contributions that fall within the five percent cap on franchise fees. The record includes examples of cable operators providing cable service to public buildings as part of a franchise agreement. Consistent with our statutory interpretation above, providing free or discounted cable service to public buildings is an in-kind ( i.e., non-monetary) contribution imposed on a cable operator by a franchise authority, and is not included in one of the enumerated exceptions from the franchise fee in section 622(g)(2). Although certain commenters emphasize that free and discounted cable services have been considered franchise considerations that are not subject to the five percent cap on franchise fees in past franchise agreements, 31 we find that our reading that free and discounted services count towards the franchise fee cap is a reasonable interpretation and best effectuates Congressional intent given that the statute defines franchise fee broadly, carving out only limited exclusions. If LFAs could circumvent the five percent cap by requiring unlimited free or discounted cable services for public buildings, in addition to a five percent franchise fee, this result would be contrary to Congress's intent as reflected in the broad definition of “franchise fee” in the statute. We find that the Act does not provide any basis for treating the value attributable to free or discounted services in a different manner than other in-kind services which must be included in the franchise fee. Although we acknowledge that the provision of free or discounted cable service to public buildings, such as schools or libraries, can benefit the public, such benefits cannot override the statutory framework. Further, there are policy rationales for limiting free services, given that, in a competitive market, such contributions may raise the costs of the cable operator's service, reduce resources available for other services, and result in market inefficiency.

27. We conclude in this section that in-kind contributions related to PEG access facilities are cable-related, in-kind contributions, and are therefore included within the statutory definition of “franchise fees” under section 622(g)(1). 32 We next conclude that the term “capital cost” in section 622(g)(2)(C) should be given its ordinary meaning, which is a cost incurred in acquiring or improving a capital asset. Applying that interpretation, we conclude that the exclusion for capital costs under section 622(g)(2)(C) could include equipment that satisfies this definition, regardless of whether such equipment is purchased in connection with the construction of a PEG access facility. We then conclude that the record is insufficiently developed for the Commission to determine whether the provision of PEG channel capacity is included within section 622(g)(2)(C)'s exclusion for capital costs. We also find that the installation of PEG transport facilities are capital costs that are exempt from the five percent franchise fee cap, 33 and that maintenance of those facilities are operating costs that count toward the cap. Finally, we address policy arguments regarding the impact of these conclusions on the provision of PEG programming.

28. Consistent with our tentative conclusion in the Second FNPRM, we find that the definition of franchise fee in section 622(g)(1) encompasses PEG-related contributions. Like other taxes, fees, or assessments imposed by LFAs, we find that contributions related to PEG access facilities imposed by an LFA are subject to the five percent cap on franchise fees, unless they fall within one of the five exclusions set forth in section 622(g)(2). Consistent with the statutory analysis above, we conclude that the provision of equipment, services, and similar contributions for PEG access facilities are cable-related, in-kind contributions that meet the definition of franchise fee. 34 Such PEG-related contributions are not exempt under section 622(g)(2) of the Act unless they fall under the limited exceptions for capital costs and costs incurred by franchises existing at the time of the Cable Act's adoption in 1984. As explained above, our starting point for analyzing cable operator contributions to LFAs is that the Act defines “franchise fee” broadly and has limited, narrow exceptions. Thus, we believe that including in the franchise fee cap any costs that are not specifically exempt is consistent with the statute and reasonably effectuates Congressional intent.

29. Further, including contributions for PEG access facilities within the franchise fee definition is consistent with the overall structure of section 622. For “any franchise in effect on October 30, 1984,” section 622(g)(2)(B) excludes from the definition of “franchise fee” “payments which are required by the franchise to be made by the cable operator during the term of such franchise for, or in support of the use of [PEG] access facilities.” There would have been no reason for Congress to grandfather in these PEG-related contributions for existing franchises if such payments were not otherwise included within the definition of “franchise fees.” In effect, excluding PEG-related contributions would read “in the case of any franchise in effect on October 30, 1984” out of section 622(g)(2)(B), extending this grandfathered exclusion to all franchises.

30. Some commenters claim that other sections of Title VI, including the section authorizing LFAs to require the designation of PEG channel capacity in section 611, override section 622's definition of “franchise fee.” As discussed above, we find these arguments unpersuasive. We also reject arguments that provisions of the Act unrelated to cable franchising demonstrate that PEG-related fees are not franchise fees. For example, section 623 of the Act, which governs the regulation of cable rates, instructs the Commission to take the following two factors (among others) into account when prescribing rate regulations:

31. Consistent with our tentative conclusions in the Second FNPRM, we conclude (1) that PEG support payments for any franchise in effect on October 30, 1984 and (2) PEG capital costs for any franchise granted after October 30, 1984 are exempt from the definition of franchise fee. As discussed above, two provisions of section 622(g)(2) exclude certain costs associated with PEG access facilities from the definition of “franchise fee” in section 622(g)(1): First, section 622(g)(2)(B) excludes PEG support payments, but only with respect to franchises granted prior to 1984. To the extent that any such franchises are still in effect, we affirm that under section 622(g)(2)(B), PEG support payments made pursuant to such franchises are excluded from the five percent franchise fee cap. Consistent with the statutory language and legislative history, we find this exclusion is broad in scope, and commenters did not dispute this interpretation in the record. 36

32. Second, for any franchise granted after 1984, section 622(g)(2)(C) contains a narrower exclusion covering only PEG “capital costs which are required by the franchise to be incurred by the cable operator for [PEG] access facilities.” The Cable Act does not define “capital costs”. We address the scope of this exclusion below by first clarifying the definition of “capital costs” and concluding that it can apply to contributions for both construction-related and non-construction-related contributions to PEG access facilities. We then determine that the record is insufficient to determine whether costs associated with providing PEG channel capacity are subject to this exclusion, and we discuss the application of the exclusion to PEG transport.

33. Definition of “capital costs.” Although the Commission previously asserted with respect to section 622(g)(2)(C) that “[c]apital costs refer to those costs incurred in or associated with the construction of PEG access facilities,” we now revisit that interpretation and provide additional clarity on the definition of this term. As described below, we find that the term “capital costs” is not limited to construction-related costs; rather, it generally encompasses costs incurred in acquiring or improving capital assets for PEG access facilities. The Commission's previous reading of the phrase “capital costs” was based in part on section 622(g)'s legislative history, which states that the Cable Act excludes from the franchise fee cap “the capital costs associated with the construction of [PEG] access facilities.” The Sixth Circuit affirmed the Commission's prior reading in Alliance, where, rejecting a challenge to the Commission's construction of the term “capital costs” in the First Report and Order, the court held that:

34. We asked for additional comment on the definition of “capital costs” under section 622(g)(2)(C) in the Second FNPRM. 37 Arguably, the Commission's previous construction left unsettled the extent to which the “capital costs” exclusion encompassed PEG equipment—such as vans, studios, or cameras. In Alliance, the Sixth Circuit observed that the Commission's definition of capital costs could encompass the costs of such equipment, but only insofar as the equipment costs were “relate[d] to the construction of PEG facilities.” But neither the First Report and Order nor the legislative history from which it borrowed expressly limited capital costs to construction-related capital costs. Both statements are silent—or, at most, unclear—about the treatment of non-construction-related capital costs.

35. Based on the arguments in the record and our further consideration of the statutory text and legislative history we now conclude that the Commission's earlier statement regarding the definition of “capital costs” was overly narrow. As commenters note, many local governments receive payments from cable operators that are not simply for the construction of PEG studios, but also for, among other things, the acquisition of equipment needed to produce PEG access programming. LFAs argue for a broader definition of “capital costs” that would include PEG channel capacity and certain equipment costs associated with PEG access facilities. 38 By contrast, cable companies have urged the Commission to reaffirm, based on its previous statement, that “capital costs” are limited to costs associated with the construction of PEG access facilities (and thus do not include channel capacity and equipment such as cameras, or other equipment necessary to run a PEG access facility).

36. In general, when a term is undefined in a statute, courts look to that term's “ordinary meaning.” While there is no general definition of the precise term “capital costs,” Black's Law Dictionary defines a similar term, 39 “capital expenditure,” as “[a]n outlay of funds to acquire or improve a fixed asset,” and defines a “fixed asset,” or “capital asset” as “[a] long-term asset used in the operation of a business or used to produce goods or services, such as equipment, land, or an industrial plant.” Merriam-Webster similarly defines “capital expenditure” as “costs that are incurred in the acquisition or improvement of property (as capital assets) or that are otherwise chargeable to a capital account,” and defines “capital assets” as “long-term assets either tangible or intangible (as land, buildings, patents, or franchises).” An accounting textbook provides yet another similar definition:

We also note that capital costs are distinct from operating costs (or operating expenses), which are generally defined as expenses “incurred in running a business and producing output.” Reflecting this distinction, the Commission has distinguished between costs incurred in building of PEG facilities, which are capital costs, and costs incurred in using those facilities, which are not.

37. While we may also look to legislative history or other context in ascertaining a statute's meaning, none of these sources here compels a narrower definition than that set forth above. The legislative history is ambiguous: The passage relied on by the Commission in the First Report and Order, from a summary in the House Report, notes that “capital costs associated with the construction of [PEG] access facilities are excluded from the definition of a franchise fee.” But section 622(g)(2)(C) does not itself restrict capital costs to costs that are construction related, nor does this passage in the legislative history expressly say that the capital costs exclusion is limited to such costs. And, as some commenters recognize, not all capital costs related to PEG access facilities are related to construction: Studio equipment, vans, and cameras, often have useful lives of several years, and the costs of acquiring such equipment are often capitalized. Such costs therefore often fall within the ordinary meaning of capital costs. Had Congress wished to exclude such costs, it could have done so by narrowing the definition of “capital costs” in the statute.

38. Consistent with our analysis above, we find that the phrase “capital costs” in section 622(g)(2)(C) should be interpreted in a manner consistent with its ordinary meaning. Based on the definitions discussed above, the term “capital cost” generally would be understood to mean a cost incurred in acquiring or improving a capital asset. Because the ordinary meaning of this term is not limited to construction-related costs, we now find that the definition of “capital costs” as used in section 622(g)(2)(C) is not limited to costs “incurred in or associated with the construction of PEG access facilities.” We conclude that while capital costs include costs associated with the construction of PEG access facilities, they are not limited to such costs. 40

39. The ordinary meaning of “capital costs” could encompass the acquisition of a non-construction-related capital asset—such as a van or a camera. Section 622(g)(2)(C) only excludes certain capital costs—those “which are required by the franchise to be incurred by the cable operator for [PEG] access facilities.” Section 602(16) defines PEG access facilities as “channel capacity . . . and facilities and equipment for the use of such channel capacity.” In the legislative history, Congress explains that “[t]his may include vans, studios, cameras, or other equipment relating to the use of public, educational, or governmental channel capacity.” Based on this statutory language and legislative history as well as the current record, we believe at the present time that the definition of “capital costs” in section 622(g)(2)(C) includes equipment purchased in connection with PEG access facilities, even if it is not purchased in conjunction with the construction of such facilities. 41 But, as both sections 622(g)(2)(c) and 602(16) make clear, the capital costs of such equipment may be excluded only insofar as they are for the use of PEG channel capacity.

40. This interpretation seems most faithful to the text of section 622(g)(2)(C), which does not restrict capital costs to those that are related to construction. We recognize that this interpretation reflects a broader sense of capital costs than described in the First Report and Order. To the extent that our interpretation in this document is inconsistent with the Commission's earlier statements about the capital cost exclusion, we find that the interpretation in this Order better comports with the Act's language, structure, and policy objectives. 42

41. We disagree with NCTA's assertion that there would have been “no good reason” to grandfather PEG equipment—such as vans and cameras—if such equipment were “subject to the permanent exception from franchise fees under section 622(g)(2)(C).” The statute itself fully excludes PEG obligations for franchises in effect on October 30, 1984, but excludes only PEG-related capital costs for franchises granted after that date. The broader exclusion for existing franchises in section 622(g)(2)(B) reflects the legislative intent to grandfather the provisions of existing PEG franchises. Section 622(g)(2)(C) provides a narrower exclusion for new franchises than the broad exclusion enjoyed by grandfathered existing franchises; one would therefore expect these two exclusions to overlap, but not be coextensive. Even under our interpretation of section 622(g)(2)(C), section 622(g)(2)(B) remains a much broader exclusion than section 622(g)(2)(C): A number of costs—most notably, operating expenses—would still be excluded by section 622(g)(2)(B), but not by section 622(g)(2)(C). 43

42. PEG channel capacity. While we find that the costs associated with the provision of PEG channel capacity are cable-related, in-kind costs that fall within the definition of “franchise fee,” we find that the record is insufficiently developed to determine whether such costs should be excluded from the franchise fee as a capital cost under the exemption in section 622(g)(2)(C). The Second FNPRM stated that, while the Act authorizes LFAs to require that channel capacity be designated for PEG use, this authorization does not necessarily remove the costs of such obligations from the five percent cap on franchise fees. In the record in this proceeding, cable operators generally agreed with this statement, and LFAs generally disagreed. As discussed above, the Act's authorization of a franchise obligation ( e.g., one related to PEG access facilities or I-Nets) does not remove that obligation from the five percent cap on franchise fees. It follows, then, that the costs associated with providing PEG channel capacity fall within this cap as a cable-related, in-kind contribution unless they are otherwise excluded under section 622(g)(2). 44

43. LFAs claim that the costs of providing PEG channel capacity do fall within section 622(g)(2)(C)'s exclusion for PEG-related capital costs. In support, they point out that the Act defines “[PEG] access facilities” as “(A) channel capacity designated for public, educational, or governmental use; and (B) facilities and equipment for the use of such channel capacity.” Thus, they assert, because section 622(g)(2)(C) expressly applies to costs incurred by a cable operator for “[PEG] access facilities,” it necessarily applies to costs associated with PEG channel capacity. But, as the cable operators state, the Act's inclusion of channel capacity in the definition of “[PEG] access facilities” does not settle the question of whether channel capacity costs fall under section 622(g)(2)(C). This is because section 622(g)(2)(C) excludes only a particular subset of PEG access facility costs—capital costs—from the definition of franchise fees subject to the five percent cap, and cable operators claim that PEG channel capacity is not a capital cost. Moreover, even assuming that PEG channel capacity is not a capital cost and is therefore subject to the five percent cap, the record reveals serious difficulties regarding how to calculate the value of PEG channel capacity to account for this cost. 45

44. Given this, we find that the questions raised by channel capacity are complex, and that the record is not developed enough to allow us to answer them. We therefore defer this issue for further consideration. 46 In the meantime, we find that the status quo should be maintained, and that channel capacity costs should not be offset against the franchise fee cap. This approach will minimize disruption and provide predictability to both local franchise authorities and cable operators.

45. Limits on LFA Authority To Establish PEG Requirements. While we do not reach a conclusion with respect to the treatment of PEG channel capacity, we reiterate here that sections 611(a) and 621(a)(4)(B) of the Act restrict the authority of LFAs to establish PEG channel capacity requirements. We discussed the limits imposed by section 611(a) in the First Report and Order. We noted that, while section 611(b) does not place a limit on the amount of channel capacity that a franchising authority may require, section 621(a)(4)(b) provides that a franchising authority may require “adequate assurance” that the cable operator will provide “adequate” PEG access channel capacity, facilities, or financial support. We determined that “adequate,” as used in the statute, should be given its ordinary meaning—“satisfactory or sufficient.”

46. In the Second FNPRM, the Commission again discussed the limits on franchising authority requirements for PEG channels under section 611(b), identifying PEG channel capacity as an in-kind contribution and seeking comment on the effects on cable operators and cable subscribers of “allowing LFAs to seek unlimited” PEG operating support and other cable-related, in-kind contributions. In response, commenters submitted examples of what they claim are LFA requirements for excessive numbers of PEG channels. LFAs responded with comments defending such requirements, as well as requirements for associated PEG support.

47. We note that many states have attempted to strike a balance between the costs of PEG channels to cable operators and the benefits of PEG channels to the public by imposing reasonable limits on PEG channel capacity. For example, some states have limited the number of PEG channels—typically to two or three. Others have required that PEG channels be returned if they are not substantially used. States have also tied the number of appropriate PEG channels to the size of the population served.

48. We decline the invitation by cable operators to establish fixed rules as to what constitutes “adequate” PEG channel capacity under section 621(a)(4)(B). 47 We recognize that the number of channels necessary to further the goals of the Cable Act might vary depending on, among other things, the number of subscribers within a franchise, the area covered by a franchise, the number of cable operators within a franchise, the area's population and geography, the cable-related community needs and interests, and whether PEG channel capacity is substantially used. In general, each of these factors is relevant in determining whether an LFA has exceeded its authority under section 621(a)(4)(B) by demanding more than “adequate” capacity. 48 We note that LFA demands for PEG capacity requirements that are more than “adequate” are subject to judicial challenge under section 635 of the Act, as well as other forms of relief. We also reserve the right to establish fixed rules in the future should there be widespread evidence of LFAs requiring more than adequate PEG channel capacity.

49. PEG transport. We find that the installation of transport facilities dedicated for long-term use by a PEG provider for the transmittal of recurring programming to a cable headend or other point in the cable system—PEG transport—does not count toward the five percent franchise fee cap. For the reasons explained above, we find that exempting capital costs from the five percent cap is consistent with the Act. The expenditure for the installation of a system that carries PEG programming from a PEG studio to a cable operator's headend facility is a capital expenditure because it is a long-term asset meant to deliver the programming. The ongoing costs associated with the maintenance or operation of that facility would not qualify as a capital expenditure, however, as these are operating costs that are necessary to run the business and produce output. NCTA requests that we declare PEG transport costs beyond “a single PEG transport return line [that] is dedicated to connecting the PEG studio to the cable network or headend” to count toward the five percent cap. Although we agree that the costs associated with the use of transport lines for “episodic” or “short-term” PEG programming is an operating cost that is subject to the franchise fee cap, we decline to establish a fixed quantity of PEG transport return lines that is “adequate” under section 621(a)(4)(B). 49 Like the number of PEG channels on a system, the number of adequate return lines in a franchise area might vary according to particular circumstances like the number of subscribers in the franchise area, the area covered by the franchise and the number of cable operators in the franchise. The number also might vary depending on the number of PEG channels provided in a franchise area and the types of programming offered over them. Nevertheless, any LFA requests for multiple transport connections dedicated for long-term PEG use that the cable operator considers to be more than “adequate” are subject to judicial challenge under section 635 of the Act.

50. We acknowledge the benefits of PEG programming and find that our interpretations adopted above are faithful to the policy objectives of the Cable Act. A significant number of comments in the record stressed these benefits, which include providing access to the legislative process of the local governments, reporting on local issues, providing a forum for local candidates for office, and providing a platform for local communities—including minority communities. Of course, Congress itself similarly recognized the importance of PEG programming by authorizing LFAs to require the provision of PEG channel capacity in the Cable Act, and by carving out certain costs of such programming from the five percent cap on franchise fees. Nothing in this proceeding disturbs the Commission's longstanding view that PEG programming serves an important role in local communities.

51. At the same time, the Cable Act seeks to encourage deployment and competition by limiting the franchise fees that LFAs may collect. These include limitations on imposing costs associated with the provision of PEG programming. A number of cable operators express concern with excessive LFA requirements for PEG channel capacity, support, and in-kind contributions. Altice, for example, notes that “PEG operational contributions . . . are common and routinely treated as separate from the 5 percent franchise fee.” Commenters likewise suggest that these excessive PEG-related demands can hinder competition and deployment.

52. The Cable Act itself, as interpreted in this Order, balances these costs and benefits. By excluding PEG-related capital costs from the five percent cap on franchise fees, but leaving other PEG-related exactions subject to that cap, the Cable Act divides the financial burden of supporting PEG programming between LFAs and cable operators. By counting a portion of these costs against the statutory cap on franchise fees that LFAs may collect, the Cable Act allows LFAs to seek support for PEG programming from cable operators, while guarding against the possibility that LFAs will make demands for such programming without regard to cost.

53. Some commenters have suggested that the proposals in the Second FNPRM threaten to eliminate or drastically reduce PEG programming. 50 We disagree. Significantly, any adverse impact of our ruling on PEG programming should be mitigated by (1) the expansion of the “capital cost” exclusion beyond merely capital costs associated with construction; and (2) our decision to defer ruling on whether the costs of channel capacity may be counted under this exclusion. 51 Under the interpretation adopted in this Order, cable operators will continue to provide support where an LFA chooses, but some aspects of that support will now be properly counted against the statutory five percent franchise fee cap, as Congress intended. 52 We recognize that this represents a departure from the longstanding treatment of PEG costs by LFAs and cable operators. We do not, however, believe that these conclusions will eliminate PEG programming. Nor do we believe that the existing practice was lawful merely because it was longstanding: the Commission's duty is to conform its rules to law, not tradition.

54. To the extent that existing practices are inconsistent with the law, LFAs will still have a choice: they can continue to receive monetary franchise payments up to the five percent cap, they can continue to receive their existing PEG support and reduce the monetary payments they receive, or they can negotiate for a reduction of both that fits within the bounds of the law that Congress adopted.

55. We find that the costs associated with the construction, maintenance, and service of an I-Net fall within the five percent cap on franchise fees. Such costs are cable-related, in-kind contributions that meet the definition of franchise fee. In particular, agreeing to construct, maintain, and provide I-Net service pursuant to the terms of a franchise agreement is necessarily cable-related, is an in-kind ( i.e., non-monetary) contribution imposed on a cable operator by a franchise authority, and is not included in one of the enumerated exceptions from the franchise fee in section 622(g)(2) of the Act. Thus, we believe that including such services in the franchise fee is consistent with the statute. As we tentatively concluded in the Second FNPRM, treating cable-related, in-kind contributions, such as I-Net requirements, as franchise fees would not undermine provisions in the Act that authorize or require LFAs to impose cable-related obligations on franchisees. We disagree with LFA commenters who argue that the cost of I-Nets should be excluded from the franchise fee. Although such commenters contend that “[t]he Commission's proposal to require LFAs to pay for I-Nets . . . cannot be squared with the statute,” it is entirely consistent with the statute to find that franchising authorities may impose cable-related requirements, such as requiring dedicated channel capacity on I-Nets, on cable operators, but also to find that funding for these franchise requirements applies against the five percent cap. Similar to our conclusion with respect to PEG support, while we acknowledge that I-Nets provide benefits to communities, 53 such benefits cannot override the statutory framework, which carves out only limited exclusions from franchise fees.

56. Further, as we conclude above, we disagree with commenters that section 611(b) of the Act, which authorizes LFAs to require that channel capacity on I-Nets be designated for educational and governmental use, should be interpreted to exempt the costs of I-Nets from franchise fees. There is no basis in the statutory text for concluding that section 611(b) imposes any limit on the definition of franchise fee. Moreover, section 622(g) defines what is included in the franchise fee, and section 622(g)(2) carves out only limited exclusions for PEG-related costs and does not exclude I-Net-related costs. As we observe above, since Congress enacted the PEG and I-Net provisions at the same time it added the franchise fee provisions, it could have explicitly excluded all costs related to I-Nets if it had intended they not count toward the cap. 54

57. We conclude that franchise terms that require cable operators to build their systems to cover certain localities in a franchise area do not count toward the five percent cap. 55 As we explain herein, Title VI establishes a framework that reflects a fundamental bargain between the cable authority and franchising authority—a cable operator may apply for and obtain a franchise to construct and operate facilities in the local rights-of-way and, in exchange, an LFA may impose fees and other requirements as set forth in the Act. The statutory framework makes clear that the authority to construct a cable system is granted to the cable operator as part of this bargain and that the costs of such construction are to be borne by the cable operator. Specifically, section 621(a)(2)(B) of the Act provides that “[a]ny franchise shall be construed to authorize the construction of a cable system over public rights-of-way, and through easements, . . . except that in using such easements the cable operator shall ensure . . . that the cost of the installation, construction, operation, or removal of such facilities be borne by the cable operator or subscriber, or a combination of both.” Because the statute is clear that cable operators, not LFAs, are responsible for the cost of building out cable systems, it would be inconsistent with the statutory text and structure to count these costs as part of the franchise fee. 56 Both cable industry and LFA commenters generally support the contention that build-out obligations should not count toward the five percent franchise fee cap. 57

58. We also conclude that franchise terms that require cable operators to comply with customer service standards do not count toward the five percent cap. 58 LFA commenters explain that cable operators are required to comply with customer service standards under federal or state law, and that cable franchises may include an obligation to comply with customer service standards. Notably, section 632 of the Act directs the Commission to “establish standards by which cable operators may fulfill their customer service requirements,” including “at a minimum, requirements governing—(1) cable system office hours and telephone availability; (2) installations, outages, and service calls; and (3) communications between the cable operator and the subscriber (including standards governing bills and refunds.” The Commission implemented this mandate in § 76.309 of its rules, which sets forth with specificity the customer service standards to which cable operators are required to adhere relating to cable system office hours and telephone availability, installations, outages and service calls, and communications between cable operators and cable subscribers. We find that franchise terms that require cable operators to adhere to customer service standards are not part of the franchise fee. In contrast to in-kind, cable-related contributions that are franchise fees subject to the statutory cap, such as the provision of free cable service to government buildings or PEG and I-Net support, 59 customer service obligations are not a “tax, fee, or assessment” imposed on a cable operator; they are regulatory standards that govern how cable operators are available to and communicate with customers. Indeed, as the legislative history explains, “[i]n general, customer service means the direct business relation between a cable operator and a subscriber,” and “customer service requirements include requirements related to interruption of service; disconnection; rebates and credits to consumers; deadlines to respond to consumer requests or complaints the location of the cable operator's consumer service offices; and the provision to customers (or potential customers) of information on billing or services.” Based on our review of the statutory text and legislative history, we find no indication that Congress intended that standards governing a cable operator's “direct business relation” with its subscribers should count toward the franchise fee cap. Apart from ACA, no commenter argued that customer service obligations should be included as franchise fees. 60

59. As we explain in this section, we conclude that cable-related, in-kind contributions will count toward the five percent franchise fee cap at their fair market value. Because we conclude above that most cable related, in-kind contributions must be included in the franchise fee, cable operators and LFAs must assign a value to them. In our prior rulemakings, we did not provide guidance on how to value such contributions, but in the Second FNPRM, the Commission recognized that cable-related contributions could count toward the franchise fee cap at cost or at fair market value, and proposed to count toward the franchise fee cap at their fair market value.

60. Most critiques of applying fair market valuation in this context challenge how it could be applied to PEG channel capacity. But, as discussed above, we have not yet determined whether to assign the value of PEG channel capacity contributions toward the five percent franchise fee cap, and therefore we do not need to address these arguments.

61. We must address the value of other in-kind contributions, however, including free service to public buildings and I-Net contributions. We believe that fair market value, where there is a product in the market, 61 is the most reasonable valuation for in-kind contributions because it is easy to ascertain—cable operators have rate cards to set the rates that they charge customers for the services that they offer. Moreover, a fair market valuation “reflects the fact that, if a franchising authority did not require an in-kind assessment as part of its franchise, it would have no choice but to pay the market rate for services it needs from the cable operator or another provider.”  62 In contrast, valuing these in-kind contributions at cost would “shift the true cost of an exaction from their taxpayer base at large to the smaller subset of taxpayers who are also cable subscribers.” As we note above, Congress adopted a broad definition of franchise fee to limit the amount that LFAs may exact from cable operators. Accordingly, we conclude that a fair market valuation for in-kind contribution best adheres to Congressional intent.

62. The franchise fee rulings we adopt in this Order are prospective. Thus, cable operators may count only ongoing and future in-kind contributions toward the five percent franchise fee cap after the Order is effective. There is broad record support for applying the rulings prospectively; no commenter argues that our rulings should apply retroactively to allow cable operators to recoup past payments that exceed the five percent franchise fee cap. To the extent a franchise agreement that is currently in place conflicts with this Order, we encourage the parties to negotiate franchise modifications within a reasonable time. 63 If a franchising authority refuses to modify any provision of a franchise agreement that is inconsistent with this Order, that provision is subject to preemption under section 636(c).

63. Many LFAs express concern that our rulings could disrupt their budgets, which rely upon the franchise fees that they expect to receive. It is by no means clear from the record what fiscal choices remain available to the LFAs, but in any event, delaying the effect of our decision to address this concern would not be consistent with the statutory text. It is strongly in the public interest to prevent the harms from existing franchise agreements to continue for years until those agreements expire. In addition, the changes we adopt in this document were reasonably foreseeable because we largely adopt the tentative conclusions set forth in the Second FNPRM. 64 Finally, we note that LFAs can continue to benefit from their agreements by choosing to continue to receive their existing in-kind contributions, while reducing the monetary payments they receive. 65 Thus, consistent with the Act, we apply our rulings to future contributions cable operators make pursuant to existing franchise agreements.

64. In this section, we address the second issue remanded from the Sixth Circuit in Montgomery County, which relates to the Commission's mixed-use rule. As explained above, the court in Montgomery County found that the Commission, in its Second Report and Order and Order on Reconsideration, failed to identify a valid statutory basis for its application of the mixed-use rule to incumbent cable operators because the statutory provision on which the Commission relied to do so—section 602(7)(C) of the Act—applies by its terms only to Title II carriers, and “many incumbent cable operators are not Title II carriers.” The court thus vacated and remanded the mixed-use rule as applied to those cable operators, directing the Commission “to set forth a valid statutory basis . . . for the rule as so applied.” For the reasons set forth below, we adopt our tentative conclusion that the mixed-use rule prohibits LFAs from regulating under Title VI the provision of any services other than cable services offered over the cable systems of incumbent cable operators, except as expressly permitted in the Act.

65. Our conclusions regarding the scope of LFAs' authority to regulate incumbent cable operators' non-cable services, facilities, and equipment follow from the statutory scheme. Congress in Title VI intended, among other things, to circumscribe the ability of franchising authorities to use their Title VI authority to regulate non-cable services provided over the cable systems of cable operators and the facilities and equipment used to provide those services. As explained below, the legislative history of the 1984 Cable Act and subsequent amendments to Title VI reflect Congress's recognition that cable operators potentially could compete with local telephone companies in the provision of telecommunications service and its intent to maintain the then-existing status quo concerning regulatory jurisdiction over cable operators' non-cable services, facilities, and equipment. Under the status quo, regulation of non-cable services provided over cable systems, including telecommunications and information services, was the exclusive province of either the Commission or state public utility commissions. 66

66. The Mixed-Use Rule Prohibits LFAs From Regulating Under Title VI the Non-Cable Services, Facilities, and Equipment of Incumbent Cable Operators That Are Also Common Carriers. As an initial matter, we reaffirm the Commission's application of the mixed-use rule to prohibit LFAs from using their cable franchising authority to regulate any services other than cable services provided over the cable systems of any incumbent cable operator that is a common carrier, 67 with the exception of channel capacity on I-Nets. 68

67. As noted above, the Commission in the First Report and Order found that the then-existing operation of the local franchising process constituted an unreasonable barrier to new entrants in the marketplace for cable services and to their deployment of broadband, in violation of section 621(a)(1) of the Act. The Commission adopted the mixed-use rule with respect to new entrants to address this unreasonable barrier. It provides, in relevant part that LFAs' jurisdiction applies only to the provision of cable services over cable systems. In particular, to the extent a cable operator provides non-cable services and/or operates facilities that do not qualify as a cable system, it is unreasonable for an LFA to refuse to award a franchise based on issues related to such services or facilities. For example, an LFA may not use its video franchising authority to attempt to regulate an entire network beyond the provision of cable services.

68. The Commission in the Second Report and Order extended to incumbent cable operators several rules adopted in the First Report and Order, including the mixed-use rule. Although, as noted, the Sixth Circuit in Montgomery County vacated and remanded the Commission's application of the mixed-use rule with respect to incumbent cable operators that are not common carriers, it left undisturbed application of the rule to incumbent cable operators that are also common carriers. 69 Consistent with the court's ruling, therefore, we adopt our tentative conclusion and reaffirm that the mixed-use rule prohibits LFAs from regulating the provision of non-cable services offered over the cable systems of incumbent cable operators that are common carriers. 70

69. Our interpretation is consistent with the text of section 602(7)(C), which excludes from the term “cable system” “a facility of a common carrier which is subject, in whole or in part, to the provisions of Title II of this Act.” We are not persuaded by assertions to the contrary. Anne Arundel County et al. argues, for example, that a cable operator's provision of telecommunications services via its cable system (either directly or through a subsidiary) “does not . . . suddenly [transform its cable system] into a Title II facility” for purposes of applying the section 602(7)(C) common carrier exception. City of Philadelphia et al. similarly argues that the common carrier exception in section 602(7)(C) was meant to protect Title II common carriers from regulation by LFAs under their Title VI franchising authority and thus cannot reasonably be read to apply to any cable operator that provides Title II and other non-cable services over a system that is a cable system.

70. To the extent these commenters argue that section 602(7)(C) precludes LFAs only from regulating non-cable services provided over the facilities of incumbent local exchange carriers that subsequently begin to provide cable service, we find such argument is not supported by the language of the statute. As noted in the Second FNPRM, although new entrants into the cable services market may confront obstacles different from those of incumbent cable operators, the statute makes no distinction between these types of providers. In the absence of any textual basis for treating incumbent cable operators that provide telecommunications services differently from new entrants that do so, we conclude that a facility should be categorized as “a facility of a common carrier” under section 602(7)(C) so long as it is being used to provide some type of telecommunications service, irrespective of whether the facility was originally deployed by a provider that historically was treated as a “common carrier.”

71. This interpretation also is consistent with the legislative history of the 1984 Cable Act. Although, as City of Philadelphia et al. points out, one of the concerns expressed in the legislative history was the potential that cable operators' provision of telecommunications services could enable large users of such services to bypass the local telephone companies and thereby threaten universal service, the legislative history also reflects Congressional recognition that “ultimately, local telephone companies and cable companies could compete in all communications services.” The legislative history clarifies, moreover, that Congress intended the 1984 Cable Act to “maintain[] [then-]existing regulatory authority over all . . . communications services offered by a cable system, including . . . services that could compete with communications services offered by telephone companies.” Indeed, the legislative history is replete with statements reflecting Congress's intent to preserve the then-status quo regarding the ability of federal, state, and local authorities to regulate non-cable services provided via cable systems. In light of its stated intention to maintain the jurisdictional status quo, we find that Congress intended via section 602(7)(C) to preclude LFAs from regulating under Title VI the provision of telecommunications services by incumbent cable operators, services that historically have been within the exclusive purview of the Commission (with respect to interstate services) or state public utility commissions (with respect to intrastate services). 71 Moreover, section 602(7)(C) broadly states that, with narrow exceptions, the facility of a common carrier is only “considered a cable system to the extent such facility is used in the transmission of video programming directly to subscribers,” and therefore not with respect to provision of any other services. For these reasons, we see no basis for altering our previous conclusion, as upheld by the Sixth Circuit, 72 that the mixed-use rule prohibits LFAs from exercising their Title VI authority to regulate the provision of non-cable services provided via the cable systems of incumbent cable operators that are common carriers, except as otherwise provided in the Act.

72. The Mixed-Use Rule Prohibits LFAs From Regulating Under Title VI the Non-Cable Services, Facilities, and Equipment of Incumbent Cable Operators That Are Not Common Carriers. We also adopt our tentative conclusion that LFAs are precluded from using their Title VI franchising authority to regulate the non-cable services ( e.g., information services such as broadband internet access) of incumbent cable operators that do not provide telecommunications services. As directed by the court, we explain herein our statutory bases for concluding that LFAs lack authority under Title VI to regulate non-cable services of incumbent cable operators that do not provide telecommunications services.

73. Section 624 of the Act, which principally governs franchising authority regulation of services, facilities, and equipment, provides in subsection (a) that “[a] franchising authority may not regulate the services, facilities, and equipment provided by a cable operator except to the extent consistent with [Title VI of the Act].”  73 The subsequent provision, section 624(b)(1), provides that franchising authorities “may not . . . establish requirements for video programming or other information services.”  74 Although the term “information service” is not defined in section 624, the legislative history of that provision distinguishes “information service” from “cable service.” In particular, the legislative history explains that “[a]ll services offered by a cable system that go beyond providing generally-available video programming or other programming are not cable services” and “a cable service may not include `active information services' such as at-home shopping and banking that allows transactions between subscribers and cable operators or third parties.”

74. We find significant that the description of the term “information services” in the legislative history ( i.e., “services providing subscribers with the capacity to engage in transactions or to store, transfer, forward, manipulate, or otherwise process information or data [which] would not be cable services”) aligns closely with the 1996 Telecommunications Act's definition of “information service” codified in section 3(24) of the Act ( i.e., “the offering of a capability for generating, acquiring, storing, transforming, processing, retrieving, utilizing, or making available information via telecommunications”). We conclude, therefore, that for purposes of applying section 624(b), interpreting the term “information services” to have the meaning set forth in section 3(24) of the Act is most consistent with Congressional intent. 75 Because the Commission has determined that broadband internet access service is an “information service” under section 3(24), 76 we likewise find that section 624(b)(1) precludes LFAs from regulating broadband internet access provided via the cable systems of incumbent cable operators that are not common carriers. Moreover, even if the definition set forth in section 3(24) was not the intended definition of “information services” for purposes of section 624(b)(1), the highly analogous descriptions of this term in the legislative history of the 1984 Act also would apply to broadband internet access service. Thus, in either case, LFAs may not lawfully impose fees for the provision of information services (such as broadband internet access) via a franchised cable system or require a franchise (or other authorization) for the provision of information services via such cable system. 77 We also clarify that LFAs and other state and local governmental units cannot impose additional requirements on mixed-use “cable systems” in a manner inconsistent with this Order and the Act under the pretense that they are merely regulating facilities and equipment rather than information services. 78

75. Although we recognize that a later provision, section 624(b)(2)(B), permits franchising authorities to enforce requirements for “broad categories of video programming or other services,” when read together with the specific injunction against regulation of “information services” in section 624(b)(1), we find that it would be unreasonable to construe section 624(b)(2)(B) as authorizing LFA regulation of information services when (b)(1) precludes franchising authorities from regulating such services. 79 As we noted in the Second FNPRM, the legislative history explains that section 624(b)(2)'s grant of authority “to enforce requirements . . . for broad categories of video programming or other services” was intended merely to “assure[] the franchising authority that commitments made in an arms-length situation will be met,” while protecting the cable operator from “being forced to provide specific programming or items of value which are not utilized in the operation of the cable system.” Reading these provisions together, it is apparent that Congress intended to permit LFAs to enforce franchise requirements governing “other services” under (b)(2), but only to the extent they are otherwise permitted to establish such requirements under (b)(1). 80 Because LFAs lack authority to regulate information services under section 624(b)(1), they may not lawfully enforce provisions of a franchise agreement permitting such regulation under section 624(b)(2), even if such provisions resulted from arms-length negotiations between the cable operator and LFA. 81 That is, the grant of authority to “enforce” certain requirements under section 624(b)(2)(B) does not give franchising authorities an independent right to impose requirements that they otherwise may not “establish” under section 624(b)(1). We thus reject claims to the contrary.

76. As discussed above, Congress in the 1984 Cable Act intended to preserve the status quo with respect to federal, state, and local jurisdiction over non-cable services, which lends further support to our conclusion that LFAs may not use their cable franchising authority to regulate information services provided over a cable system. Because information services that are interstate historically have fallen outside the lawful regulatory purview of state and local authorities, 82 including LFAs, construing section 624(b) to bring those services within the scope of permissible LFA authority under Title VI would be fundamentally at odds with Congressional intent. For this reason, we reject City of Philadelphia et al.'s contention that our application of the mixed-use rule is barred by the Act because “[t]he `regulatory and jurisdictional status quo' in 1984 . . . included [LFAs'] use of the franchise and franchise agreement to regulate . . . cable systems that [Congress] recognized were carrying both cable services and non-cable communications services.” The statutory design as reflected in other provisions of Title VI reinforces our conclusion that LFAs are precluded under section 624(b)(1) from regulating non-cable services provided over the cable systems of incumbent cable operators that are not common carriers. LFAs, therefore, may not lawfully regulate the non-cable services of such cable operators, including information services (such as broadband internet access), private carrier services (such as certain types of business data services), and interconnected VoIP service. 83 For example, this precludes LFAs from not only requiring such a cable operator to pay fees or secure a franchise to provide broadband service via its franchised cable system, but also requiring it to meet prescribed service quality or performance standards for broadband service carried over that cable system.

77. We find unconvincing arguments that the statute compels a broader reading of LFAs' authority under Title VI to regulate cable operators' non-cable services, facilities, and equipment. Anne Arundel County et al. maintains, for example, that because section 624(a) grants LFAs authority to regulate a “cable operator,” a term the Act defines as “[a] person . . . who provides cable service over a cable system,” LFAs generally are authorized to regulate any of the services provided by a “cable operator” over a “cable system,” including non-cable services. 84 Anne Arundel County et al. contends further that under section 624(b), LFAs “to the extent related to the establishment or operation of a cable system . . . may establish requirements for facilities and equipment” and argues that the Act cannot be construed as limiting LFAs' jurisdiction to cable services since it permits LFAs to require, for example, build out and institutional networks. We disagree with these arguments. Although, as Anne Arundel County et al. and others note, the Act in certain circumstances permits LFAs to impose on cable operators certain requirements that are not strictly related to the provision of cable service, such circumstances constitute limited exceptions to the general prohibition on LFA regulation of non-cable services contained in section 624. 85 They also do not override the specific prohibition on regulation of information services set forth in section 624(b)(1). This interpretation accords with one of the 1984 Cable Act's principal purposes to “continue[] reliance on the local franchising process as the primary means of cable television regulation, while defining and limiting the authority that a franchising authority may exercise through the franchise process.”

78. We also conclude, contrary to the assertions of some commenters, that it would conflict with Congress's goals in the Act to permit LFAs to treat incumbent cable operators that are not common carriers differently from incumbent cable operators and new entrants that are common carriers in their provision of information services, including broadband internet access service. As we noted in the Second FNPRM, incumbent and new entrant cable operators (whether or not they are also common carriers) often compete in the same markets and offer nearly identical services to consumers. Thus, to allow LFAs to regulate the latter group of providers more strictly, such as by subjecting them to franchise and fee requirements for the provision of non-cable services, could place them at a competitive disadvantage. 86 A report submitted by NCTA asserts, for example, that two fixed broadband providers may build out their networks differently, with one utilizing wireless backhaul and the other using landline backhaul, but “if one has inputs subjected to [fees] and the other does not, the differential . . . treatment can distort competition between the two, even when the services provided . . . are indistinguishable to the consumer.” The distortion to competition that stems from “hampering a subset of competitors,” in turn, reduces the incentives of those competitors to invest in cable system upgrades for the provision of both cable and non-cable services, which could thwart the 1996 Act's goals to promote competition among communications providers and secure lower prices and higher quality services for consumers. 87 Such regulations, moreover, impede the Commission's development of a “consistent regulatory framework across all broadband platforms,” which is “[o]ne of the cornerstones of [federal] broadband policy.”  88

79. We also are not convinced by arguments that interpreting the Act to bar LFAs from regulating non-cable facilities and equipment placed in public rights-of-way would pose a safety risk to the public because cable operators would have unfettered discretion to install non-cable facilities without review or approval by local authorities. Section 636(a) of the Act specifically provides that “[n]othing in [Title VI] shall be construed to affect any authority of any State, political subdivision, or agency thereof, or franchising authority, regarding matters of public health, safety, and welfare, to the extent consistent with the express provisions of [Title VI].” This provision, which is an express exception to Title VI's general prohibition on franchising authority regulation of non-cable facilities and equipment, thus permits LFAs to impose requirements on non-cable facilities and equipment designed to protect public safety, so long as such requirements otherwise are consistent with the provisions of Title VI.

80. As noted above, Title VI does not permit franchising authorities to extract fees or impose franchise or other requirements on cable operators insofar as they are providing services other than cable services. Ample record evidence shows, however, that some states and localities are purporting to assert authority to do so outside the limited scope of their authority under Title VI. These efforts appear to have followed the decision by the Supreme Court of Oregon in City of Eugene v. Comcast, which upheld a local government's imposition of an additional seven percent “telecommunications” license fee on the provision of broadband services over a franchised cable system with mixed use facilities. To address this problem, we now expressly preempt any state or local requirement, whether or not imposed by a franchising authority, that would impose obligations on franchised cable operators beyond what Title VI allows. 89 Specifically, we preempt (1) any imposition of fees on a franchised cable operator or any affiliate using the same facilities franchised to the cable operator  90 that exceeds the formula set forth in section 622(b) of the Act and the rulings we adopt in this document, whether styled as a “franchise” fee, “right-of-access” fee, or a fee on non-cable ( e.g., telecommunications or broadband) services, and (2) any requirement that a cable operator with a Title VI franchise secure an additional franchise or other authorization to provide non-cable services via its cable system. 91 We base these conclusions on Congress's express decision to preempt state and local laws that conflict with Title VI of the Communications Act (section 636(c)), the text and structure of Title VI and the Act as a whole, Congressional and Commission policies (including the policy of nonregulation of information services), and the Supremacy Clause of the U.S. Constitution. 92

81. Authority to Preempt. Congress has the authority to preempt state law under Article VI of the U.S. Constitution. While Congress's intent to preempt sometimes needs to be discerned or implied from a purported conflict between federal and state law, here Congress spoke directly to its intent to preempt state and local requirements that are inconsistent with Title VI. This express preemption extends beyond the actions of any state or local franchising authority. Section 636(c) of the Act provides that “any provision of law of any State, political subdivision, or agency thereof, or franchising authority, or any provision of any franchise granted by such authority, which is inconsistent with this chapter shall be deemed to be preempted and superseded.”  93 The reference in section 636(c) to “this chapter” means that Congress intended to preempt any state or local law (or any franchise provision) that is inconsistent with any provision of the Communications Act, whether or not codified in Title VI. 94 Moreover, section 636(c) applies broadly to “any [inconsistent] provision of law” of “any State, political subdivision, or agency thereof.”  95 That means that Congress intended that states and localities could not “end-run” the Act's limitations by using other governmental entities or other sources of authority to accomplish indirectly what franchising authorities are prohibited from doing directly. 96

82. Where Congress provides an express preemption provision such as section 636(c), the Commission has delegated authority to identify the scope of the subject matter expressly preempted and assess whether a state's law falls within that scope. The Commission may, therefore, expressly bar states and localities from acting in a manner that is inconsistent with both the Act and the Commission's interpretations of the Act, so long as those interpretations are valid. We therefore disagree with assertions that the Commission lacks authority to preempt non-cable regulations imposed by states and localities pursuant to non-Title VI sources of legal authority.

83. Scope of Preemption. The Commission's task, then, in interpreting the scope of preemption under section 636(c) is to determine whether specific state or local requirements are inconsistent with Title VI or other provisions in the Communications Act. Looking at the provisions of Title VI and the Act as a whole, we have little trouble concluding that Congress did not intend to permit states, municipalities, or franchising authorities to impose fees or other requirements on cable operators beyond those specified under Title VI, under the guise of regulating “non-cable services” or otherwise restricting a cable operator's construction, operation, or management of facilities in the rights-of-way.

84. As an initial matter, we note that Title VI establishes a framework that reflects the basic terms of a bargain—a cable operator may apply for and obtain a franchise to access and operate facilities in the local rights-of-way, and in exchange, a franchising authority may impose fees and other requirements as set forth and circumscribed in the Act. So long as the cable operator pays its fees and complies with the other terms of its franchise, it has a license to operate and manage its cable system free from the specter of compliance with any new, additional, or unspecified conditions (by franchise or otherwise) for its use of the same rights-of-way.

85. The substantive provisions of Title VI make the terms of this bargain clear. For starters, section 621(a)(1) provides franchising authorities with the right to grant franchises, and section 621(a)(2) explains that such franchises “shall be construed to authorize the construction of a cable system over public rights-of-way . . .” A “cable operator,” in turn, may not provide “cable service” unless the cable operator has obtained such a franchise. Other provisions make clear that a franchise does not merely authorize the construction of a cable system, but also the “management and operation of such a cable system, 97 including the installation of Wi-Fi and small cell antennas attached to the cable system.”

86. The right to construct, manage, and operate a “cable system” does not mean merely the right to provide cable service. 98 Numerous provisions in Title VI evidence Congress's knowledge and understanding that cable systems would carry non-cable services—including telecommunications and information services. The definition of “cable system,” for example, anticipates that some facilities may carry both telecommunications and cable services. With respect to information services, section 601 of the Act provides that one of Title VI's purposes is to “assure that cable communications provide and are encouraged to provide the widest possible diversity of information sources and services to the public.” And, as we have already seen, Congress expressly provided in section 624(b) for “mixed-use” facilities that carry both cable services and “video programming or other information services.”

87. The legislative history reinforces the conclusion that Congress understood that a franchised “cable system” would carry both cable and non-cable services. The House Report, for example, explains that “[t]he term `cable system' is not limited to a facility that provides only cable service which includes video programming. Quite the contrary, many cable systems provide a wide variety of cable services and other communications services as well. A facility would be a cable system if it were designed to include the provision of cable services (including video programming) along with communications services other than cable service.”

88. The point is that Congress was well aware that “cable systems” would be used to carry a variety of cable and non-cable services. It follows that Congress could have, if it wanted, provided significant leeway for states, localities, and franchising authorities to tax or provide other regulatory restrictions on a cable system's provision of non-cable services in exchange for the cable operator receiving access to the rights-of-way. But as it turns out, the balance of Title VI makes clear that Congress sharply circumscribed the authority of state or local governments to regulate the terms of this exchange. In this document, we make clear that, under section 636(c), states, localities, and franchising authorities may not impose fees or restrictions on cable operators for the provision of non-cable services in connection with access to such rights-of-way, except as expressly authorized in the Act. We provide further explanation in two critical areas to clarify that these categories of state and local restrictions are preempted: (a) Additional franchise fees beyond those authorized in section 622 and (b) additional franchises or regulatory restrictions on a cable operator's construction, management, or operation of a cable system in the rights-of-way.

89. Additional fees. Both Congress and the Commission have recognized that the franchise fee is the core consideration that franchising authorities receive in exchange for the cable operator's right to access and use the rights-of-way. As explained in detail above, Congress carefully circumscribed how this fee should be calculated: It provided that “the franchise fees paid by a cable operator with respect to any cable system shall not exceed 5 percent of such cable operator's gross revenues derived in such period from the operation of the cable system to provide cable services”. We must assume that Congress's careful choice of words was intentional. While the fee would apply to the “cable operator” with respect to any “cable system,” it would only apply to revenue obtained from “cable services,” not non-cable services that Congress understood could provide additional sources of revenue.

90. We find additional support for this conclusion in Congress's broad definition of the term “franchise fee,” which covers “any tax, fee, or assessment of any kind imposed by a franchising authority or other governmental entity on a cable operator or cable subscriber or both, solely because of their status as such.” This broad definition was intended to limit the imposition of any tax, fee, or assessment of any kind—including fees purportedly for provision of non-cable services or for, access to, use of, or the value of the rights of way—to five percent of the cable operator's revenue from cable services. 99 And its language reinforces the text of section 636(c) by making clear that a different state or local “governmental entity” cannot end-run the cap by imposing fees for access to any public right of way within the franchise area or in instances of overlapping jurisdiction.

91. In reaching this conclusion, we read the phrase “solely because of their status as such” as protective language intended to place a ceiling on any sort of fee that a franchising authority might impose on a cable operator qua cable operator or qua franchisee—that is, any fee assessed in exchange for the right to construct, manage, or operate a cable system in the rights-of-way. We therefore reject the claim of some commenters that this language permits localities to charge additional fees so long as the cable operator also acts as a telecommunications provider or internet service provider, or so long as the state or locality can articulate some non-cable related rationale for its actions. This alternate rationale flies in the face of statutory text. As noted above, a “cable operator” is defined not only as a person or entity that provides cable service, but also one that “controls or is responsible for, through any arrangement, the management and operation of such a cable system.” The management or operation of a cable system includes the maintenance of the system to provide non-cable services—which Congress understood would be supplied over the same cable facilities. 100 Because a fee that a state or locality imposes on a cable operator's provision of non-cable services relates to the “manage[ment] and operat[ion]” of its cable system, such fee is imposed on the cable operator “solely because of [its] status” as a cable operator and is capped by section 622.

92. The structure of section 622 as a whole provides further support for our reading. The language “solely because of their status as such” operates to distinguish fees imposed on cable operators for access to the rights-of-way (“franchise fees”), which are capped, from “any tax, fee, or assessment of general applicability,” which are not. Section 622 thus envisions two mutually exclusive categories of assessments—(1) fees imposed on cable operators for access to the rights-of-way in their capacity as franchisees (that is, “solely because of their status as such”) and (2) broad-based taxes. Understood in this manner, any assessment on a cable operator for constructing, managing, or operating its cable system in the rights-of-way is subject to the five-percent cap—even if other non-cable service providers ( e.g., telecommunications or broadband providers) are subject to the same or similar access fees. 101 This is because the definition of “franchise fee” in section 622(g)(1) centers on why the fee is imposed on a cable operator, i.e., “solely because of [its] status” as a franchisee, and not to whom the fee is imposed, i.e., “solely applicable” to a cable operator. The entire category of “franchise fees” is subject to the five-percent cap, in distinction to generally-applicable taxes whose validity must be shown, at least in part, by their application to broader classes of entities or citizens beyond providers of cable and non-cable communications services. 102

93. The legislative history and purposes of the 1984 Cable Act support this broad and exclusive interpretation of the term “franchise fees.” It reveals, for example, that Congress initially established the section 622(b) cap on franchise fees out of concern that local authorities could use such fees as a revenue-raising mechanism. A reading of section 622 that would permit states and localities to circumvent the five percent cap by imposing unbounded fees on “non-cable services” would frustrate the Congressional purpose behind the cap and effectively render it meaningless. The legislative history behind the 1996 amendments to section 622(b) make this intent explicit. Prior to 1996, section 622 provided, in relevant part, that “the franchise fees paid by a cable operator with respect to any cable system shall not exceed [five percent] of such cable operator's gross revenues derived . . . from the operation of the cable system.” The House Report accompanying the 1996 amendment, 103 which explained the addition of the key limitation “for the provision of cable services” in section 622(b), provides that:

94. If, as CAPA asserts, Congress had intended the term “cable operator” as used in section 622(b) to refer to an entity only to the extent such entity provides cable service, there would have been no need for Congress to amend section 622(b) in this manner.

95. Although, as LFA advocates note, section 621(d)(2) of the Act provides that “[n]othing in [Title VI] shall be construed to affect the authority of any State to regulate any cable operator to the extent that such operator provides any communication service other than cable service, whether offered on a common carrier or private contract basis,” this provision is not an affirmative grant to states of authority to regulate non-cable services that they historically have not been empowered to regulate. First, the term “State” in section 621(d) does not extend to LFAs; it is defined by reference to section 3 of the Communications Act. The legislative history makes clear that this was a reference to the division of regulatory authority between the “state public utility commission and . . . the FCC.” Second, this provision merely reflects Congress's intent in the 1984 Cable Act to preserve the status quo with respect to federal and state jurisdiction over non-cable services. As noted, under the then-existing status quo, the Commission had jurisdiction to regulate interstate services; states had jurisdiction to regulate intrastate services. Because the Commission historically has concluded that information service is jurisdictionally interstate, it traditionally has fallen outside the proper regulatory sphere of state and local authorities. 104 Moreover, the Commission has long recognized the impossibility of separately regulating interstate and intrastate information services. Thus, neither a state nor its political subdivisions may lawfully regulate such service under section 621(d)(2) by requiring a cable operator with a Title VI franchise to pay a fee or secure a franchise or other authorization to provide broadband internet access service over its cable system. To conclude otherwise would contravene Congress's intent in Title VI to maintain the jurisdictional status quo with respect to federal, state, and local regulation of non-cable services. 105

96. We find unpersuasive NATOA et al.'s selective reading of the legislative history to conclude that Congress intended to permit states and localities to require franchised cable operators to pay additional rights-of-way fees for the provision of non-cable services. NATOA et al. note that the House Conference Report accompanying the 1996 amendment stated that “to the extent permissible under state and local law, communications services, including those provided by a cable company, shall be subject to the authority of a local government to, in a nondiscriminatory and competitively neutral way, manage its public rights-of-way and charge fair and reasonable fees.” Although the cited legislative history is relevant to our interpretation of the statute, 106 we do not read this language so broadly as permitting states and localities to charge redundant or duplicative fees on cable franchisees that are subject to the five-percent cap—a reading that would, as we have explained, eviscerate the cap entirely. Rather, we conclude that, under section 636(c), and taking into account the provisions of Title VI as a whole, any fees that exceed the five-percent cap, as formulated in section 622, are not “fair and reasonable.”  107

97. Consistent with Congress's intent, as early as 2002, the Commission has construed section 622(b) to permit franchising authorities to include in the revenue base for franchise fee calculations only those revenues derived from the provision of cable service. 108 Thus, if a cable operator generates additional revenue by providing non-cable services over its cable system, such additional revenue may not be included in the gross revenues for purposes of calculating the cable franchise fee. 109

98. As courts have recognized, the Commission is charged with “the ultimate responsibility for ensuring a `national policy' with respect to franchise fees.” We exercise that authority in this document by making clear that states, localities, and cable franchising authorities are preempted from charging franchised cable operators more than five percent of their gross revenue from cable services. This cap applies to any attempt to impose a “tax, fee, or assessment of any kind” that is not subject to one of the enumerated exemptions in section 622(g)(2) on a cable operator's non-cable services or its ability to construct, manage, or operate its cable system in the rights-of-way.

99. Additional Franchises or Other Requirements. Congress also made clear that states, localities, and franchising authorities lack authority to require additional franchises or place additional nonmonetary conditions on a cable operator's provision of non-cable services that are not expressly authorized in the Act. Several provisions state explicitly that franchising authorities may not regulate franchised “cable systems” to the extent that they provide telecommunications services. In addition, as we noted above, section 624(b)(1) precludes franchising authorities from “establish[ing] requirements for video programming or other information services.” In the mixed-use rule we adopt in this document, we reasonably construed this provision to prohibit LFAs from regulating information services provided over cable systems.

100. As noted above, section 636(c) operates to preempt state and local requirements that would use non-Title VI authority to accomplish indirectly what franchising authorities are prohibited from doing directly. Consistent with this reasoning, we conclude that any state or local law or legal requirement that obligates a cable operator franchised under Title VI to obtain a separate, additional franchise (or other authorization) or imposes requirements beyond those permitted by Title VI to provide cable or non-cable services, including telecommunications and information services, over its cable system conflicts with the Act and thus also is expressly preempted by section 636(c). The mixed-use rule we adopt in this document represents a reasonable interpretation of the relevant provisions of Title VI as well as a balanced accommodation of the various policy interests that Congress entrusted to the Commission; therefore, it too has preemptive effect under section 636(c). 110

101. Public Policy. Apart from our analysis of the text and structure of the Act and our longstanding delegated authority to preempt state regulations that are inconsistent with the Act, our preemption decisions in this document are also consistent with Congress's and the Commission's public policy goals and an appropriate response to problems that are apparent in the record.

102. Recognizing that excessive regulation at the local level could limit the potential of cable systems to deliver a broad array of services, Congress expressed its intent to “minimize unnecessary regulation that would impose an undue economic burden on cable systems” and “assure that cable communications provide and are encouraged to provide the widest possible diversity of information sources and services to the public.” More generally, section 230(b) of the Act expresses Congress's intent “to preserve the vibrant and competitive free market that presently exists for the internet and other interactive computer services, unfettered by Federal or State regulation.”  111 Accordingly, the Commission has previously preempted state and local regulations that would conflict with this federal policy of nonregulation of information services. These longstanding federal policies provide further support for our decision in this document to read Title VI as prohibiting states, localities, and franchising authorities from imposing fees and obligations on cable operators beyond those expressly set forth in that Title.

103. Our preemption decision in this document will advance these federal policies by preventing further abuses of state and local authorities of the kind manifested in the record in this proceeding. In recent years, governmental entities at the local level increasingly have sought to regulate non-cable services provided over mixed-use cable systems franchised under Title VI, particularly broadband internet access service. Such governmental entities have included not only state and local franchising authorities acting pursuant to the cable franchising provisions of Title VI, but also state and local entities purportedly acting pursuant to their police powers to regulate public rights-of-way or other powers derived from sources outside Title VI. Although the record reveals that such regulation takes many different forms, NCTA and other industry advocates have expressed acute concerns about two particular kinds of state and local regulation: (1) Requirements obligating cable operators with a Title VI franchise that are subject to the franchise fee requirement in section 622(b) of the Act to pay additional fees for the provision of non-cable services (such as broadband internet access) via their cable systems; and (2) requirements obligating cable operators with a Title VI franchise to secure an additional franchise (or other authorization) to provide non-cable services over their cable systems. Our preemption decisions in this document are carefully tailored to address these problems and prevent states and localities from continuing to circumvent the carefully calibrated terms of Title VI through these and similar kinds of regulations.

104. We disagree with those commenters who attempt to minimize the harm posed by the state and local requirements that we preempt in this document. We disagree, for example, that cable industry claims regarding the impact of duplicative fee and franchise requirements on broadband deployment are belied by the industry's substantial investments to date in broadband infrastructure, and that such requirements thus will not adversely affect broadband investment going forward. As the record reflects, even if cable operators were to continue to invest, such investments likely would be higher absent such requirements, and even small decreases in investment can have a substantial adverse impact on consumer welfare. We also are persuaded that the imposition of duplicative requirements may deter investment in new infrastructure and services irrespective of whether or to what extent a cable operator passes on those costs to consumers. Contrary to the assertions of some commenters, we also believe that such requirements impede Congress's goal to accelerate deployment of “advanced telecommunications capability to all Americans.”

In rule FR Doc. 2019-15056, published in the Federal Register at 84 FR 33858, on July 16, 2019, on page 33858, in the third column, in the docket number in the document heading, remove “GSAR Change 102”.

Table of Contents I. Background II. Summary of This Action III. Final Action IV. Procedural Requirements V. Approval of the Office of the Secretary I. Background

Section 102 of the Department of Energy Research and Innovation Act, Public Law 115-246 (Research and Innovation Act), amended section 1001 of EPACT 2005, 42 U.S.C. 16391 to require DOE to permit specified National Laboratories owned by DOE to use funds authorized to support technology transfer within DOE to carry out early stage and precommercial technology demonstration activities to remove technology barriers that limit private sector interest and demonstrate potential commercial applications of any research and technologies arising from National Laboratory activities.

The Technology Transfer Mission clause at 48 CFR 970.5227-3 (paragraph (c)(1)) currently limits the use of funds used to support Office of Research and Technology Applications (ORTAs) to three categories: (1) Obtaining, maintaining, licensing, and assigning Intellectual Property rights; (2) increasing the potential for the transfer of technology; and (3) providing widespread notice of technology transfer opportunities. Pursuant to the Research and Innovation Act, DOE is modifying its acquisition regulation by amending the text of the Technology Transfer Mission clause to add (as a fourth category) early stage and precommercial technology demonstration activities to paragraph (c)(1), “Allowable costs”.

As a result of the change imposed by the Research and Innovation Act, DOE amends § 970.5227-3(c)(1) by revising the second sentence to add “early stage and precommercial technology demonstration to remove barriers that limit private sector interest and demonstrate potential commercial applications of any research and technologies arising from Laboratory activities.” DOE welcomes information on the early stage and precommercial technology demonstration activities that may be enabled at the DOE National Laboratories through the use of funds available for technology transfer.

DOE has determined, pursuant to 5 U.S.C. 553(b)(B), that prior notice and an opportunity for public comment on this final rule are unnecessary. This rule inserts into the CFR, for the benefit of the public, the Research and Innovation Act requirement that DOE permit the directors of the National Laboratories to use funds authorized to support technology transfer within the Department to carry out early stage and precommercial technology demonstration activities to remove technology barriers that limit private sector interest and demonstrate potential commercial applications of any research and technologies arising from National Laboratory activities. DOE exercises no discretion in amending its regulations to implement this statutory requirement. DOE, therefore, finds that good cause exists to waive prior notice and an opportunity to comment for this rulemaking. For the same reasons, DOE, pursuant to 5 U.S.C. 553(d)(3), finds that good cause exists for making this final rule effective upon publication in the Federal Register.

This final rule is a not a “significant regulatory action” under the criteria set out in section 3(f) of Executive Order 12866, “Regulatory Planning and Review.” 58 FR 51735 (October 4, 1993). Accordingly, this action was not subject to review by the Office of Information and Regulatory Affairs (“OIRA”) in the Office of Management and Budget (“OMB”).

On January 30, 2017, the President issued Executive Order 13771, “Reducing Regulation and Controlling Regulatory Costs.” That Order stated the policy of the executive branch is to be prudent and financially responsible in the expenditure of funds, from both public and private sources. The Order stated it is essential to manage the costs associated with the governmental imposition of private expenditures required to comply with Federal regulations. This final rule is expected to be an E.O. 13771 deregulatory action.

Additionally, on February 24, 2017, the President issued Executive Order 13777, “Enforcing the Regulatory Reform Agenda.” The Order required the head of each agency designate an agency official as its Regulatory Reform Officer (RRO). Each RRO oversees the implementation of regulatory reform initiatives and policies to ensure that agencies effectively carry out regulatory reforms, consistent with applicable law. Further, E.O. 13777 requires the establishment of a regulatory task force at each agency. The regulatory task force is required to make recommendations to the agency head regarding the repeal, replacement, or modification of existing regulations, consistent with applicable law. At a minimum, each regulatory reform task force must attempt to identify regulations that:

(i) Eliminate jobs, or inhibit job creation;

(ii) Are outdated, unnecessary, or ineffective;

(iii) Impose costs that exceed benefits;

(iv) Create a serious inconsistency or otherwise interfere with regulatory reform initiatives and policies;

(v) Are inconsistent with the requirements of Information Quality Act, or the guidance issued pursuant to that Act, in particular those regulations that rely in whole or in part on data, information, or methods that are not publicly available or that are insufficiently transparent to meet the standard for reproducibility; or

(vi) Derive from or implement Executive Orders or other Presidential directives that have been subsequently rescinded or substantially modified.

DOE concludes that this final rule is consistent with the requirements set forth in these executive orders. The Research and Innovation Act amends EPACT 2005 to require DOE to permit the directors of the National Laboratories to use funds authorized to support technology transfer within the Department to carry out early stage and precommercial technology demonstration activities to remove technology barriers that limit private sector interest and demonstrate potential commercial applications of any research and technologies arising from National Laboratory activities. The current regulatory language does not permit such use of these funds. Therefore, this final rule is an Executive Order 13771 deregulatory action.

The Regulatory Flexibility Act (5 U.S.C. 601 et seq. ) requires preparation of an initial regulatory flexibility analysis for any rule that by law must be proposed for public comment, unless the agency certifies that the rule, if promulgated, will not have a significant economic impact on a substantial number of small entities. As required by Executive Order 13272, “Proper Consideration of Small Entities in Agency Rulemaking,” 67 FR 53461 (August 16, 2002), DOE published procedures and policies on February 19, 2003, to ensure that the potential impacts of its rules on small entities are properly considered during the rulemaking process. 68 FR 7990. The Department has made its procedures and policies available on the Office of General Counsel's website: http://energy.gov/gc/office-general-counsel. This rule revises the Code of Federal Regulations to incorporate, without substantive change, a statutorily-required change to permit use of funds authorized to support technology transfer to carry out early stage and precommercial technology demonstration activities to remove technology barriers that limit private sector interest and demonstrate potential commercial applications of any research and technologies arising from National Laboratory activities. Because this is a technical amendment for which a general notice of proposed rulemaking is not required, the Regulatory Flexibility Act does not apply to this rulemaking.

This rulemaking imposes no new information or record keeping requirements. Accordingly, Office of Management and Budget clearance is not required under the Paperwork Reduction Act. (44 U.S.C. 3501 et seq. )

In this rule, DOE is incorporating requirements prescribed by the Research and Innovation Act. DOE has determined that this rule falls into a class of actions that are categorically excluded from review under the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq. ) and DOE's implementing regulations at 10 CFR part 1021. Specifically, this rule is strictly procedural and, therefore, would not result in any environmental impacts. Thus, this rulemaking is covered by Categorical Exclusion A6 under 10 CFR part 1021, subpart D, which applies to procedural rulemakings. Accordingly, neither an environmental assessment nor an environmental impact statement is required.

Executive Order 13132, “Federalism,” 64 FR 43255 (August 4, 1999), imposes certain requirements on agencies formulating and implementing policies or regulations that preempt State law or that have federalism implications. The Executive Order requires agencies to examine the constitutional and statutory authority supporting any action that would limit the policymaking discretion of the States and to carefully assess the necessity for such actions. The Executive Order also requires agencies to have an accountable process to ensure meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications. On March 14, 2000, DOE published a statement of policy describing the intergovernmental consultation process it will follow in the development of such regulations. 65 FR 13735. DOE has determined that this rule does not limit the policymaking discretion of the States. No further action is required by Executive Order 13132.

With respect to the review of existing regulations and the promulgation of new regulations, section 3(a) of Executive Order 12988, “Civil Justice Reform,” 61 FR 4729 (February 7, 1996), imposes on Federal agencies the general duty to adhere to the following requirements: (1) Eliminate drafting errors and ambiguity; (2) write regulations to minimize litigation; and (3) provide a clear legal standard for affected conduct rather than a general standard and promote simplification and burden reduction. Section 3(b) of Executive Order 12988 specifically requires that Executive agencies make every reasonable effort to ensure that the regulation: (1) Clearly specifies the preemptive effect, if any; (2) clearly specifies any effect on existing Federal law or regulation; (3) provides a clear legal standard for affected conduct while promoting simplification and burden reduction; (4) specifies the retroactive effect, if any; (5) adequately defines key terms; and (6) addresses other important issues affecting clarity and general draftsmanship under any guidelines issued by the Attorney General. Section 3(c) of Executive Order 12988 requires Executive agencies to review regulations in light of applicable standards in section 3(a) and section 3(b) to determine whether they are met or it is unreasonable to meet one or more of them. DOE has completed the required review and determined that, to the extent permitted by law, this final rule meets the relevant standards of Executive Order 12988.

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) requires each Federal agency to assess the effects of Federal regulatory actions on State, local, and Tribal governments and the private sector. (Pub. L. 104-4, sec. 201 (codified at 2 U.S.C. 1531)). For a proposed regulatory action likely to result in a rule that may cause the expenditure by State, local, and Tribal governments, in the aggregate, or by the private sector of $100 million or more in any one year (adjusted annually for inflation), section 202 of UMRA requires a Federal agency to publish a written statement that estimates the resulting costs, benefits, and other effects on the national economy. (2 U.S.C. 1532(a), (b)) The UMRA also requires a Federal agency to develop an effective process to permit timely input by elected officers of State, local, and Tribal governments on a proposed “significant intergovernmental mandate,” and requires an agency plan for giving notice and opportunity for timely input to potentially affected small governments before establishing any requirements that might significantly or uniquely affect small governments. On March 18, 1997, DOE published a statement of policy on its process for intergovernmental consultation under UMRA (62 FR 12820) (also available at http://www.gc.doe.gov). This final rule contains neither an intergovernmental mandate nor a mandate that may result in the expenditure of $100 million or more in any year, so these requirements under the Unfunded Mandates Reform Act do not apply.

Section 654 of the Treasury and General Government Appropriations Act, 1999 (Pub. L. 105-277) requires Federal agencies to issue a Family Policymaking Assessment for any rule that may affect family well-being. This final rule would not have any impact on the autonomy or integrity of the family as an institution. Accordingly, DOE has concluded that it is not necessary to prepare a Family Policymaking Assessment.

The Department has determined, under Executive Order 12630, “Governmental Actions and Interference with Constitutionally Protected Property Rights,” 53 FR 8859 (March 18, 1988), that this rule would not result in any takings which might require compensation under the Fifth Amendment to the United States Constitution.

Section 515 of the Treasury and General Government Appropriations Act, 2001 (44 U.S.C. 3516, note) provides for agencies to review most disseminations of information to the public under guidelines established by each agency pursuant to general guidelines issued by OMB. OMB's guidelines were published at 67 FR 8452 (February 22, 2002), and DOE's guidelines were published at 67 FR 62446 (October 7, 2002). DOE has reviewed this final rule under the OMB and DOE guidelines and has concluded that it is consistent with applicable policies in those guidelines.

Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use,” 66 FR 28355 (May 22, 2001), requires Federal agencies to prepare and submit to the Office of Information and Regulatory Affairs (OIRA), Office of Management and Budget, a Statement of Energy Effects for any proposed significant energy action. A “significant energy action” is defined as any action by an agency that promulgates or is expected to lead to promulgation of a final rule, and that: (1) Is a significant regulatory action under Executive Order 12866, or any successor order; and (2) is likely to have a significant adverse effect on the supply, distribution, or use of energy, or (3) is designated by the Administrator of OIRA as a significant energy action. For any proposed significant energy action, the agency must give a detailed statement of any adverse effects on energy supply, distribution, or use should the proposal be implemented, and of reasonable alternatives to the action and their expected benefits on energy supply, distribution, and use. This final rule, which incorporates recently-enacted statutory provisions into DOE's regulations, would not have a significant adverse effect on the supply, distribution, or use of energy and, therefore, is not a significant energy action.

As required by 5 U.S.C. 801, DOE will report to Congress on the promulgation of this rule prior to its effective date. The report will state that it has been determined that the rule is not a “major rule” as defined by 5 U.S.C. 804(2).

The Secretary of Energy has approved publication of this final rule.

For the reasons set forth in the preamble, DOE hereby amends chapter 9, subchapter I, of title 48 of the Code of Federal Regulations as set forth below:

Background

On July 25, 2018, the Service published proposed regulation revisions in the Federal Register (83 FR 35174) regarding section 4(d) of the Act and its implementing regulations in title 50 of the Code of Federal Regulations at 50 CFR part 17 setting forth the prohibitions for species listed as threatened on the Federal Lists of Endangered and Threatened Wildlife and Plants (lists). In the July 25, 2018, Federal Register document, we provided the background for our proposed regulation revisions in terms of the statute, legislative history, and case law.

The regulations that implement the ESA are located in title 50 of the Code of Federal Regulations. This final rule revises regulations found in part 17 of title 50, particularly in subpart D, which pertains to threatened wildlife, and subpart G, which pertains to threatened plants.

In this final rule, we amend §§ 17.31 and 17.71. Among other changes, language is added in both sections to paragraph (a) to specify that its provisions apply only to species listed as threatened species on or before the effective date of this rule. Species listed or reclassified as a threatened species after the effective date of this rule would have protective regulations only if the Service promulgates a species-specific rule (also referred to as a special rule). In those cases, we intend to finalize the species-specific rule concurrent with the final listing or reclassification determination. Notwithstanding our intention, we have discretion to revise or promulgate species-specific rules at any time after the final listing or reclassification determination.

This change makes our regulatory approach for threatened species similar to the approach that the National Marine Fisheries Service (NMFS) has taken since Congress added section 4(d) to the Act, as discussed below. The protective regulations that currently apply to threatened species would not change, unless the Service adopts a species-specific rule in the future. As of the date of this final rule, there are species-specific protective regulations for threatened wildlife in subpart D of part 17, but the Service has not adopted any species-specific protective regulations for plants. These final regulations do not affect the consultation obligations of Federal agencies pursuant to section 7 of the Act. These final regulations do not change permitting pursuant to 50 CFR 17.32.

The prohibitions set forth in ESA section 9 expressly apply only to species listed as endangered under the Act, as opposed to threatened. 16 U.S.C. 1538(a). ESA section 4(d), however, provides that the Secretaries of the Interior and Commerce may by regulation extend some or all of the section 9 prohibitions to any species listed as threatened. Id. section 1533(d). 16 U.S.C. 1533(d). See, also S. Rep. 93-307 (July 1, 1973) (in amending the ESA to include the protection of threatened species and creating “two levels of protection” for endangered species and threatened species, “regulatory mechanisms may more easily be tailored to the needs of the” species). Our existing regulations in §§ 17.31 and 17.71, extending most of the prohibitions for endangered species to threatened species unless altered by a specific regulation, is one reasonable approach to exercising the discretion granted to the Service by section 4(d) of the Act. See Sweet Home Chapter of Communities for a Great Or. v. Babbitt, 1 F.3d 1, 7 (D.C. Cir. 1993) (“regardless of the ESA's overall design, § 1533(d) arguably grants the FWS the discretion to extend the maximum protection to all threatened species at once, if guided by its expertise in the field of wildlife protection, it finds it expeditious to do so”), altered on other grounds in rehearing, 17 F.3d 1463 (D.C. Cir. 1994).

Another reasonable approach is the one that the Department of Commerce, through NMFS, has taken in regard to the species under its purview. NMFS did not adopt regulations that extended most of the prohibitions for endangered species to threatened species as we did. Rather, for each species that they list as threatened, NMFS promulgates the appropriate regulations to put in place prohibitions, protections, or restrictions tailored specifically to that species. In more than 40 years of implementing the Act, NMFS has successfully implemented the provisions of the Act using this approach.

Moreover, we have gained considerable experience in developing species-specific rules over the years. Where we have developed species-specific 4(d) rules, we have seen many benefits, including removing redundant permitting requirements, facilitating implementation of beneficial conservation actions, and making better use of our limited personnel and fiscal resources by focusing prohibitions on the stressors contributing to the threatened status of the species. This final rule will allow us to capitalize on these benefits in tailoring the regulations to the needs of threatened species.

For example, we finalized a species-specific 4(d) rule for the coastal California gnatcatcher ( Polioptila californica californica ) on December 10, 1993 (58 FR 65088). In that 4(d) rule, we determined that activities that met the requirements of the State of California's Natural Communities Conservation Plan for the protection of coastal sage scrub habitat would not constitute violations of section 9 of the Act. Similarly, in 2016, we finalized the listing of the Kentucky arrow darter ( Etheostoma spilotum ) with a species-specific 4(d) rule that exempts take as a result of beneficial in-stream habitat enhancement projects, bridge and culvert replacement, and maintenance of stream crossings on lands managed by the U.S. Forest Service in habitats occupied by the species (81 FR 68963, October 5, 2016). As with both of these examples, if the proposed rule is finalized, we would continue our practice of explaining in the preamble the rationale for the species-specific prohibitions included in each 4(d) rule.

These final regulations would remove the references to subpart A in §§ 17.31 and 17.71. In § 17.31, we specify which sections apply to wildlife, to be more transparent as to which provisions contain exceptions to the prohibitions. In § 17.71, we remove all reference to subpart A, because none of those exceptions apply to plants.

In finalizing the specific changes to the regulations that follow, and setting out the accompanying clarifying discussion in this preamble, the Service is establishing prospective standards only. Nothing in these final revised regulations is intended to require (now or at such time as these regulations may become final) that any previous listing or reclassification determinations or species-specific protective regulations be reevaluated on the basis of any final regulations. The existing protections for currently listed threatened species are within the discretion expressly delegated to the Secretaries by Congress.

Pursuant to section 10(j) of the Act, members of experimental populations are generally treated as threatened species and, pursuant to 50 CFR 17.81, populations are designated through population-specific regulation found in §§ 17.84-17.86. As under our existing practice, each such population-specific regulation will contain all of the applicable prohibitions, along with any exceptions to prohibitions, for that experimental population. None of the changes associated with this rulemaking will change existing special rules for experimental populations. Any 10(j) rules promulgated after the effective date of this rule that make applicable to a nonessential experimental population some or all of the prohibitions that statutorily apply to endangered species will not refer to 50 CFR 17.31(a); rather, they will instead independently articulate those prohibitions or refer to 50 CFR 17.21.

We are finalizing the revised regulations as proposed without further changes. In these final regulation revisions, we focus our discussion on significant and substantive comments we received during the comment period. For additional background on the statutory language, legislative history, and case law relevant to these regulations, please see our proposed regulation revision, which is available at http://www.regulations.gov under Docket No. FWS-HQ-ES-2018-0007.

This final rule is one of three related final rules that we are publishing in this issue of the Federal Register . All of these documents finalize revisions to various regulations that implement the Act. The revisions to the regulations in this rule are prospective; they are not intended to require that any previous listing or reclassification determination under section 4 of the Act be reevaluated.

In our proposed rule published on July 25, 2018 (83 FR 35174), we requested public comments on our specific proposed changes to 50 CFR part 17. We received several requests for public hearings and requests for extensions to the public comment period. However, we elected not to hold public hearings or extend the public comment period beyond the original 60-day public comment period. We received more than 69,000 submissions representing hundreds of thousands of individual commenters by the deadline on September 24, 2018. Many comments were nonsubstantive in nature, expressing either general support for or opposition to provisions of the proposed rule with no supporting information or analysis or expressing opinions regarding topics not covered within the proposed regulation. We also received many detailed substantive comments with specific rationale for support of or opposition to specific portions of the proposed rule. Below, we summarize and respond to the significant, substantive comments sent by the September 24, 2018, deadline and provide responses to those comments.

Comment 1: Many commenters stated that rescinding the previous regulation, referred to as the “blanket rules,” will leave threatened species with no protections or prohibitions in place, which will result in their status declining even more and the Service being unable to conserve them.

Our Response: In the proposed rule, we stated our intention to finalize species-specific 4(d) rules concurrent with final threatened listing or reclassification determinations. In this final rule, we restate our intention to finalize species-specific section 4(d) rules concurrently with final listing or reclassification determinations. Finalizing a species-specific 4(d) rule concurrent with a listing or reclassification determination ensures that the species receives appropriate protections at the time it is added to the list as a threatened species ( e.g., we anticipate that foreign species 4(d) rules will generally include prohibitions of import and export and species-specific 4(d) rules for marine mammals will generally incorporate applicable provisions of the Marine Mammal Protection Act). This approach also adds efficiency, predictability, and transparency to the rulemaking process because it correlates the Service's analysis of threats impacting the species (as discussed in the final listing or reclassification rule) to its analysis of protective regulations for the species. The publication of Federal Register documents that propose and finalize both listing and 4(d) rules simultaneously adds administrative efficiencies and cost-savings to the listing process relative to the time and cost of conducting those two processes sequentially.

We expect this concurrent process to promote transparency and predictability in the rulemaking process for the regulated community. Publishing species-specific 4(d) rules concurrent with the classification rules provides the public knowledge of the primary drivers to the species' status. The 4(d) rule includes specific actions or activities that can be undertaken that would or would not impair species' conservation. In turn, this information may assist with streamlining future section 7 consultations. For example, if project activities could be tailored to avoid forms of take prohibited by the 4(d) rule, consultation on those activities should be more straightforward and predictable. Furthermore, we anticipate landowners would be incentivized to take actions that would improve the status of endangered species with the possibility of downlisting the species to threatened and potentially receiving regulatory relief in the resulting 4(d) rule. As a result, we believe these measures to increase public awareness, transparency, and predictability will enhance and expedite conservation.

Comment 2: Several commenters stated that rescinding the blanket rules will allow for political interference and industry pressure on the Service to reduce protections and prohibitions of threatened species at the detriment of species conservation.

Our Response: As explained in the preamble to the proposed regulation, the intent of this regulation is to focus prohibitions on the stressors contributing to the threatened status of the species and to facilitate the implementation of beneficial conservation efforts. This practice of tailoring regulations to individual threatened species is guided by the Service's extensive history of implementing the Act. Our determinations about which prohibitions, exceptions to the prohibitions, or protective regulations should be applied to threatened species have consistently been, and will continue to be, based upon the best available scientific and commercial information available to us at the time of listing.

Comment 3: Many commenters stated that FWS has a substantial listing and reclassification workload and lacks the additional resources necessary to promulgate species-specific 4(d) rules for every species added to the list as threatened. They stated that the additional resources necessary to promulgate additional rules will impact FWS' ability to put into place the protections necessary and species will be left unprotected.

Our Response: Promulgating species-specific 4(d) rules for every threatened species may require additional resources at the time of listing relative to our prior practice of defaulting to invoking the blanket rules. If historical percentages of threatened species and endangered species determinations were to continue into the future, we estimate that each year approximately four species would be listed as threatened species; therefore, we would develop four species-specific 4(d) rules per year. Historically, we finalized an average of 2 species-specific 4(d) rules per year (37 species-specific 4(d) rules over 21 years (Service 2019). However, in the past 10 years, we have promulgated 17 domestic and 6 foreign species-specific rules (2.3 per year) as compared to 12 domestic and 2 foreign species-specific rules in the 11 years prior (1.3 per year) (Service 2019). We expect to continue with an increased rate of issuing species-specific rules in the coming years. Therefore, we expect that we would promulgate species-specific rules for most or all species listed as threatened even if the blanket rule were to remain in place.

Developing species-specific 4(d) rules is a prudent and efficient use of our resources because of the benefits gained from tailoring protections specific to the needs of the species. When we tailor regulations by limiting the prohibitions to those activities that are causing the threat of extinction, we save the public and FWS resources by reducing the need for section 10 permits. Likewise, tailored regulations will encourage actions compatible with, or supportive of, a species' conservation. Tailored prohibitions may also assist the Service and other Federal agencies in streamlining the section 7 consultation processes for actions that result in forms of take that are not prohibited by a 4(d) rule. For example, the Services would have already determined that forms of take not prohibited by a 4(d) rule were compatible with the species' conservation, which should streamline our analysis on whether an action would jeopardize the continued existence of the species and would streamline the incidental take statement, if required. Species-specific regulations will also allow the Service to facilitate and promote conservation actions that will aid in the conservation of threatened species. In addition, because we intend to put in place species-specific rules at the time of listing (as noted in our response to comment (1)), we will continue to rely on our analysis of stressors to the species from the listing determination, including forms of “take,” that are acting on a species. Because of this concurrent analysis of all factors influencing the species carrying over from the listing determination, we anticipate the development of species-specific protective regulations will be more efficient than if done in separate rulemakings.

In general, the provisions of a 4(d) rule should be closely tied to the species' needs and primary factors influencing the biological status identified in the Species Status Assessment (SSA) report or other analysis of the species' biological status. Determining which protective regulations or section 9 prohibitions or exceptions to prohibitions a species requires to address the stressors leading to threatened species status logically flows from our analyses at the time of listing. Furthermore, when developing new species-specific 4(d) rules, we intend to review existing species-specific 4(d) rules that could be used as a model or applied to the species in question. This approach would be beneficial when there are species with similar threats or that occur in a similar geographic area, or species with similar life histories or similar biological needs. For example, the Service has an existing species-specific 4(d) rule for threatened species within the parrot family, which is found at 50 CFR 17.41(c), that includes protective regulations for four different species. Where appropriate, the Service adds additional listed members of the parrot family to this rule. In this fashion, developing species-specific regulations will not be as time consuming or burdensome as the commenters predict because the Service will be able to rely on existing regulatory language and analysis. Similar examples are the Service's existing species-specific 4(d) rules for threatened primates (50 CFR 17.40(c)), crocodilians (50 CFR 17.42(c)), certain fish (50 CFR 17.44(c), (h), and (j)), and certain butterflies (50 CFR 17.47(a)).

Comment 4: Several commenters stated that the prior regulations for threatened species have been working to conserve threatened species for the last 40 years and FWS should not rescind them.

Our Response: We are required to develop regulations as described in section 4(d) of the Act that are necessary and advisable for the conservation of threatened species. Additionally, section 4(d) of the Act provides us the authority to prohibit specific forms of take. Developing species-specific 4(d) rules will enhance transparency to the regulated public because particular forms of incidental take that are prohibited or excepted will be enumerated in the species-specific 4(d) rule. The only thing that this rulemaking will change is that the decision about what regulations to put in place will now by necessity be in the form of promulgating a species-specific rule.

Although the blanket rules have worked, and will continue to work, to conserve already-listed threatened species, we believe that species-specific 4(d) rules for threatened species tailor species' protection with appropriate regulations that may incentivize conservation, reduce unneeded permitting, or streamline section 7 consultation processes as described above. In practice, the FWS has been promulgating more species-specific 4(d) rules in the last decade. The Service has finalized 22 species-specific 4(d) rules in the last decade (2009-2018) compared to finalizing 13 species-specific rules in the 12 years prior (1997-2008). Consequently, we have found significant benefits from developing and implementing species-specific 4(d) rules, such as removing redundant permitting requirements, facilitating implementation of beneficial conservation actions, and making better use of our limited personnel and fiscal resources by focusing prohibitions on the stressors contributing to the threatened status of the species.

This rule will facilitate beneficial conservation actions. For example, the species-specific 4(d) rule for the elfin-woods warbler (81 FR 40547, June 22, 2016) sets forth a comprehensive set of conservation measures regarding otherwise lawful activities for conversion of sun-grown to shade-grown coffee plantations, riparian buffer establishment, and reforestation and forested habitat enhancement. The 4(d) rule provides details on the timing and acceptable methods by which these activities can occur such that any incidental take would not be a violation of the Act. Thus, projects that meet the conservation measures for the elfin-woods warbler outlined in the species-specific 4(d) rule do not need an incidental take permit from the Service in order to proceed. Likewise, the species-specific 4(d) rule for the Kentucky arrow darter (81 FR 68984, October 5, 2016) contains recommended conservation measures that, when conducted in accordance with the 4(d) rule, ensure that incidental take would not be considered a violation of the Act. The species-specific 4(d) rule details activities such as in-stream restoration or reconfiguration, bank stabilization, bridge and culvert replacement or removal that must be conducted in accordance with conservation measures that maintain connectivity of habitat, minimize instream disturbance, and maximize the amount of in-stream cover. Therefore, projects that are conducted in accordance with the conservation measures in the species-specific 4(d) rule for the Kentucky arrow darter do not require an incidental take permit from the Service.

Comment 5: Several commenters stated that FWS did not provide enough justification or logical rationale for why the change is necessary.

Our Response: Our preamble to the proposed rule provides an explanation of why we proposed to change our prior practice of the blanket rules. This regulatory change to emphasize the creation of species-specific 4(d) rules is within the discretion provided by the Act. We recognize that our prior “blanket rules” were also considered “reasonable and permissible” constructions of section 4(d) of the Act. Sweet Home Chapter of Communities for a Great Oregon v. Babbitt, 1 F.3d. 1, 8 (D.C. Cir. 1993), modified on other grounds on reh'g, 17 F.3d 1463 (D.C. Cir. 1994), rev'd on other grounds, 515 U.S. 687 (1995). For this reason, we are not altering the existence of the “blanket rules” for species already listed as threatened. However, we conclude that moving to an emphasis on species-specific regulations is also a reasonable and permissible interpretation of the discretion found in section 4(d) of the Act. As explained elsewhere, we believe this change will aid in the conservation of species. We also consider this change to further highlight the statutory distinction between species meeting the definitions of “endangered species” and “threatened species.” This change would make our regulatory approach for threatened species similar to the approach that NMFS has taken since Congress added section 4(d) to the Act. NMFS did not adopt regulations that extended most of the prohibitions for endangered species to threatened species as we did. Rather, when putting into place protections for threatened species, NMFS promulgates the appropriate regulations regarding section 9 prohibitions, exceptions to prohibitions, or other regulatory protections tailored specifically to that species. In more than 40 years of implementing the Act, NMFS has successfully implemented the provisions of the Act using this approach.

Moreover, the Service has gained considerable experience in developing species-specific rules over the past decade. As noted elsewhere in this response to comments, we have found species-specific 4(d) rules beneficial in removing redundant permitting requirements, facilitating implementation of beneficial conservation actions, and making better use of our limited personnel and fiscal resources by focusing prohibitions on the stressors contributing to the threatened status of the species. For instance, some species-specific 4(d) rules would not require a Federal permit for incidental take resulting from activities that are conducted under a State permit if the permit was issued pursuant to a State program that furthers the goals of the Act. Other species-specific 4(d) rules may set forth exceptions to take prohibitions for activities that are de minimis in their effect on the species, or beneficial when conducted in adherence to certain timeframes or using certain protocols ( e.g., elfin woods warbler species-specific 4(d) rule; 81 FR 40547, June 22, 2016). This regulatory revision allows us to capitalize on these benefits in tailoring section 9 prohibitions, exceptions to prohibitions, or other regulatory protections to the conservation needs of the species.

We conclude that, while the prior “blanket rules” were one possible means of implementing section 4(d) of the Act, the changes finalized in this document will better tailor protections to the needs of the threatened species while also providing meaning to the statutory distinction between species meeting the definitions of “endangered species” and “threatened species.”

Comment 6: Some commenters stated that this change is not actually aligning the Service's practice with NMFS, because NMFS does not consistently promulgate species-specific 4(d) rules for threatened species.

Our Response: NMFS does not have a default blanket rule for threatened plants and animals but rather approaches each species on a case-by-case basis on the basis of the discretion afforded under section 4(d). Therefore, rescinding the Service's blanket rules will closely align the two agencies' regulatory approaches. Although we have indicated that our intention is to promulgate species-specific 4(d) rules at the time of listing, we do not read the Act to require that we promulgate a 4(d) rule whenever we list a species as a threatened species.

Comment 7: Some commenters stated that if a threatened species did not have section 9 prohibitions, private landowners would not have an incentive to conserve species and landowners may be unlikely to enter into partnership agreements to conserve threatened species.

Our Response: We intend for each species listed or reclassified as a threatened species to have a species-specific 4(d) rule that outlines section 9 prohibitions, exceptions to prohibitions, or other regulatory protections as appropriate. Any species-specific 4(d) will follow the Service's standard rulemaking process, which by law includes an opportunity for public comment on a proposed rule. As a result, private landowners will be aware of proposed regulations and have an opportunity to proactively engage in voluntary conservation efforts. By meaningfully recognizing the differences in the regulatory framework between endangered species and threatened species, we believe that crafting species-specific 4(d) rules will incentivize conservation for both endangered species and threatened species. Private landowners and other stakeholders may see more of an incentive to work on recovery actions for endangered species, with an eventual goal of downlisting to threatened species status with a species-specific 4(d) rule that might result in reduced regulation.

For threatened species, 4(d) rules can limit the scope of prohibitions so that they do not apply to certain activities conducted pursuant to conservation efforts contained in conservation plans or agreements. We anticipate that private parties, including landowners, will be incentivized to participate in conservation efforts identified in the 4(d) rule that protect the species. In these instances, specified activities would be able to continue without Federal regulation because of participation in the identified conservation plan. At the same time, the plan will provide conservation to the threatened species. In addition, tailoring the prohibitions applicable to a threatened species identifies for the public the specific actions or activities that are driving the species to a threatened status. Developing species-specific 4(d) rules will incentivize positive conservation efforts to improve the species' status such that it no longer warrants listing.

Comment 8: Several commenters stated that the Service should include binding timeframes in the regulatory text as to when the final 4(d) rule would be promulgated. Some of these included the suggestion that it be within 90 days of the final listing, others stated that it should be concurrent with listing, and others did not provide a specific time period but stated that a set timeframe would be most transparent to the public.

Our Response: As stated above, we intend to finalize species-specific 4(d) rules concurrently with final listing or reclassification determinations. We believe this approach will be most efficient and will also ensure that threatened species have in place the protective regulations supporting their recovery. We considered including a regulatory timeframe to reflect our intention to promulgate 4(d) rules at the time of listing, but ultimately determined that creating a binding requirement was not needed. The Act does not mandate a specific requirement to implement protective regulations concurrently with threatened determinations.

Comment 9: We received many comments on topics that were not specifically addressed in our proposed regulatory amendment, but, instead, focus on issues that may arise during implementation of this rulemaking. These included recommendations on which existing species-specific 4(d) rules would provide a good model for future rules, opinions as to the scope of the Service's discretion in extending section 9 prohibitions in future rules, views on how the Service should interpret the terms “necessary and advisable” in the Act, and suggestions of approaches to take in future guidance documents on how to develop species-specific 4(d) rules.

Our Response: The Service appreciates the many insightful comments and suggestions we received on developing species-specific 4(d) rules. While that input may inform the development of future species-specific 4(d) rules, policies, or guidance, in the interests of efficiency we are finalizing the revisions for which we specifically proposed regulatory text. The Service considered those comments, but is required only to respond to “significant” comments—those “comments which, if true, . . . would require a change in [the] proposed rule,” Am. Mining Cong. v. United States EPA, 907 F.2d 1179, 1188 (DC Cir. 1990) (quoting ACLU v. FCC, 823 F.2d 1554, 1581 (DC Cir. 1987)). Comments that either were outside the scope of the issues we specifically addressed in our proposed regulatory amendments, or that raise questions that may arise during future implementation of this rulemaking, are not “significant” in the context of the proposed rule. See also Home Box Office, Inc. v. FCC, 567 F.2d 9, 35 n. 58 (DC Cir. 1977), cert. denied, 485 U.S. 959, 108 S.Ct. 1220, 99 L.Ed.2d 421 (1988). We therefore will not respond to them at this time. However, to the extent commenters raised questions about the substance of future species-specific 4(d) regulations that have not been proposed, we urge commenters to provide this feedback when a proposed species-specific 4(d) regulation raises these concerns. Any species-specific 4(d) regulation will be proposed and subject to public comment prior to adoption by the Service.

After a review and careful consideration of all of the public comments received during the open public comment period, we have finalized this rule as proposed.

Executive Order 12866 provides that the Office of Management and Budget's Office of Information and Regulatory Affairs (OIRA) will review all significant rules. OIRA has determined that this rule is significant.

Executive Order 13563 reaffirms the principles of E.O. 12866 while calling for improvements in the nation's regulatory system to promote predictability, to reduce uncertainty, and to use the best, most innovative, and least burdensome tools for achieving regulatory ends. The executive order directs agencies to consider regulatory approaches that reduce burdens and maintain flexibility and freedom of choice for the public where these approaches are relevant, feasible, and consistent with regulatory objectives. E.O. 13563 emphasizes further that regulations must be based on the best available science and that the rulemaking process must allow for public participation and an open exchange of ideas. We have developed this rule in a manner consistent with these requirements. This final rule is consistent with Executive Order 13563, and in particular with the requirement of retrospective analysis of existing rules, designed “to make the agency's regulatory program more effective or less burdensome in achieving the regulatory objectives.”

This final rule is an Executive Order 13771 deregulatory action.

Under the Regulatory Flexibility Act (as amended by the Small Business Regulatory Enforcement Fairness Act (SBREFA) of 1996; 5 U.S.C. 601 et seq. ), whenever a Federal agency is required to publish a notice of rulemaking for any proposed or final rule, it must prepare, and make available for public comment, a regulatory flexibility analysis that describes the effect of the rule on small entities ( i.e., small businesses, small organizations, and small government jurisdictions). However, no regulatory flexibility analysis is required if the head of an agency, or his designee, certifies that the rule will not have a significant economic impact on a substantial number of small entities. SBREFA amended the Regulatory Flexibility Act to require Federal agencies to provide a statement of the factual basis for certifying that a rule will not have a significant economic impact on a substantial number of small entities. The following discussion explains our rationale.

This rulemaking revises the regulations for 4(d) rules for species determined to meet the definition of a “threatened species” under the Act. This final rule is fundamentally a procedural change for the Service that affects only the form of the Service's decisions with respect to regulations that provide for the conservation of threatened species. The Service is therefore the only entity that is directly affected by this final regulation change at 50 CFR part 17. The statute states, “Whenever any species is listed as a threatened species . . ., the Secretary shall issue such regulations as he deems necessary and advisable to provide for the conservation of such species.” This provision requires the Secretary to make a decision about what protections to apply to threatened species. The blanket rules established that, as a general principle, the protections that the statute prescribes for endangered species are also necessary and advisable to provide for the conservation of threatened species. But even with the blanket rules in place, it fell to the Secretary to decide, upon listing or classifying individual species as threatened, what protections to put in place for the species. That decision was in the form of whether to allow the relevant blanket rule to apply or to promulgate a species-specific rule. The need for that decision is even ensconced in the blanket rules themselves—they expressly contemplate that the Secretary could choose to promulgate a “special rule” that would replace the blanket rule and “contain all the applicable prohibitions and exceptions.” 50 CFR 17.31(c) and 17.71(c).

With promulgation of this rule, when species get listed in the future, the blanket rules will no longer be in place, but the Secretary will still be required to make a decision about what regulations to put in place for that species. The only thing that this rulemaking will change is that the decision about what regulations to put in place will now necessarily be in the form of promulgating a species-specific rule. To the extent that any regulations that provide for the conservation of threatened species affect external entities, those effects result from the substance of the subsequent rulemaking where the Service will decide what regulations would provide for the species' conservation, not from this rulemaking, which affects only the form of that decision. As a result, no external entities—including any small businesses, small organizations, or small governments—will experience any economic impacts from this rule. We certify that this final rule will not have a significant economic effect on a substantial number of small entities.

In accordance with the Unfunded Mandates Reform Act (2 U.S.C. 1501 et seq. ):

(a) On the basis of information contained in the Regulatory Flexibility Act section above, this final rule will not “significantly or uniquely” affect small governments. We have determined and certify pursuant to the Unfunded Mandates Reform Act, 2 U.S.C. 1502, that this rule would not impose a cost of $100 million or more in any given year on local or State governments or private entities. A Small Government Agency Plan is not required. As explained above, small governments would not be affected because the final rule will not place additional requirements on any city, county, or other local municipalities.

(b) This final rule will not produce a Federal mandate on State, local, or tribal governments or the private sector of $100 million or greater in any year; that is, this rule is not a “significant regulatory action” under the Unfunded Mandates Reform Act. This final rule will not impose obligations on State, local, or tribal governments.

In accordance with Executive Order 12630, this final rule will not have significant takings implications. This final rule will not pertain to “taking” of private property interests, nor will it directly affect private property. A takings implication assessment is not required because this final rule (1) will not effectively compel a property owner to suffer a physical invasion of property and (2) will not deny all economically beneficial or productive use of the land or aquatic resources. This final rule will substantially advance a legitimate government interest (conservation and recovery of threatened species) and will not present a barrier to all reasonable and expected beneficial use of private property.

In accordance with Executive Order 13132, we have considered whether this final rule would have significant Federalism effects and have determined that a federalism summary impact statement is not required. This final rule pertains only to prohibitions for activities pertaining to threatened species under the Endangered Species Act and would not have substantial direct effects on the States, on the relationship between the Federal Government and the States, or on the distribution of power and responsibilities among the various levels of government.

This final rule does not unduly burden the judicial system and meets the applicable standards provided in sections 3(a) and 3(b)(2) of Executive Order 12988. This final rule will clarify the prohibitions to threatened species under the Endangered Species Act.

In accordance with Executive Order 13175 “Consultation and Coordination with Indian Tribal Governments” and the Department of the Interior's manual at 512 DM 2, we have considered effects of this final rule on federally recognized Indian Tribes. Two informational webinars were held on July 31 and August 7, 2018, to provide additional information to interested Tribes regarding the proposed regulations. After the opening of the public comment period, we received multiple requests for coordination or Government-to-Government consultation from multiple tribes: Cowlitz Indian Tribe; Swinomish Indian Tribal Community; The Confederated Tribes of the Grand Ronde Community of Oregon; Confederated Tribes of Warm Springs, Oregon; Quinault Indian Nation; Makah Tribe; Confederated Tribes of the Umatilla Indian Reservation; and the Suquamish Tribe. We subsequently hosted a conference call on November 15, 2018, to listen to Tribal concerns and answer questions about the proposed regulations. On March 6, 2019, Service representatives attended the Natural Resources Committee Meeting of the United and South and Eastern Tribes' Impact Week conference in Arlington (Crystal City), VA. At this meeting, we presented information, answered questions, and held discussion regarding the regulatory changes.

The Service concludes that the changes to these implementing regulations make general changes to the ESA implementing regulations and do not directly affect specific species or Tribal lands or interests. As explained earlier, the only thing that this rulemaking will change is that the decision about what regulations to put in place to provide for the conservation of threatened species will now necessarily be in the form of promulgating a species-specific rule. To the extent that any regulations that provide for the conservation of threatened species affect federally recognized Indian Tribes, those effects will result from the substance of the subsequent rulemaking where the Service will decide what regulations would provide for the species' conservation, not from this rulemaking, which affects only the form of that decision. Therefore, we conclude that this regulation does not have “tribal implications” under section 1(a) of E.O. 13175 and formal government-to-government consultation is not required by E.O. 13175 and related policies of the Department of the Interior. We will continue to collaborate with Tribes on issues related to federally listed species and work with them as we implement the provisions of the Act. See Joint Secretarial Order 3206 (“American Indian Tribal Rights, Federal-Tribal Trust Responsibilities, and the Endangered Species Act,” June 5, 1997).

This rule does not contain information collection requirements, and a submission to the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) is not required. We may not conduct or sponsor and you are not required to respond to a collection of information unless it displays a currently valid OMB control number.

We analyzed this final rule in accordance with the criteria of NEPA, the Department of the Interior regulations on implementation of NEPA (43 CFR 46.10-46.450), and the Department of the Interior Manual (516 DM 8). We have determined that, to the extent that the proposed action would result in reasonably foreseeable effects to the human environment, the final regulation is categorically excluded from further NEPA review and that no extraordinary circumstances are present. The rule qualifies for two categorical exclusions listed at 43 CFR 46.210(i). First, the amendments are of a legal, technical, or procedural nature. Second, any potential impacts of this rule are too broad, speculative, and conjectural to lend themselves to meaningful analysis and will be examined as part of any NEPA analysis, if applicable, in stand-alone species-specific 4(d) rules. The revisions finalized in this action are intended to clarify, interpret, and implement portions of the Act concerning the procedures and criteria used for determining what protective regulations are appropriate for species added to or reclassified as threatened species on the Lists of Endangered and Threatened Wildlife and Plants.

These revisions are an example of an action that is fundamentally administrative, technical, or procedural in nature. As explained with respect to the Regulatory Flexibility Act, this final rule is fundamentally a procedural change for the Service that affects only the form of the Service's decisions with respect to regulations that provide for the conservation of threatened species. The Service is, therefore, the only entity that is directly affected by this final regulation change at 50 CFR part 17. The statute states, “Whenever any species is listed as a threatened species . . ., the Secretary shall issue such regulations as he deems necessary and advisable to provide for the conservation of such species.” This provision requires the Secretary to make a decision about what protections to apply to threatened species. When species get listed in the future, the blanket rules will no longer be in place, but the Secretary will still be required to make a decision about what regulations to put in place for that species. The only thing that this rulemaking will change is that the decision about what regulations to put in place will now necessarily be in the form of promulgating a species-specific rule. To the extent any regulations that provide for the conservation of threatened species significantly affect the environment, those effects result from the substance of the subsequent rulemaking where the Service will decide what regulations would provide for the species' conservation, not from this rulemaking, which affects only the form of that decision. Therefore, this final rule falls within the categorical exclusion for rulemakings that are administrative, procedural, or technical in nature.

We completed an environmental action statement for the categorical exclusion for the revised regulations in 50 CFR part 17. The environmental action statement is available at http://www.regulations.gov in Docket No. FWS-HQ-ES-2018-0007.

Executive Order 13211 requires agencies to prepare Statements of Energy Effects when undertaking certain actions. This final rule is not expected to affect energy supplies, distribution, and use. As explained earlier, the only thing that this rulemaking will change is that the decision about what regulations to put in place to provide for the conservation of threatened species will now necessarily be in the form of promulgating a species-specific rule. To the extent any regulations that provide for the conservation of threatened species affect energy supply, distribution, or use, those effects will result from the substance of the subsequent rulemaking where the Service will decide what regulations would provide for the species' conservation, not from this rulemaking, which affects only the form of that decision. Therefore, this action is not a significant energy action, and no Statement of Energy Effects is required.

Accordingly, we hereby amend part 17, subchapter B of chapter I, title 50 of the Code of Federal Regulations, as set forth below:

Background

The Migratory Bird Treaty Act (MBTA) of July 3, 1918 (16 U.S.C. 703 et seq. ), authorizes and directs the Secretary of the Department of the Interior, having due regard for the zones of temperature and for the distribution, abundance, economic value, breeding habits, and times and lines of flight of migratory game birds, to determine when, to what extent, and by what means such birds or any part, nest, or egg thereof may be taken, hunted, captured, killed, possessed, sold, purchased, shipped, carried, exported, or transported.

In the July 8, 2019, Federal Register (84 FR 32385), we proposed special migratory bird hunting regulations for the 2019-20 hunting season for certain Indian tribes, under the guidelines described in the June 4, 1985, Federal Register (50 FR 23467). The guidelines respond to tribal requests for Service recognition of their reserved hunting rights, and for some tribes, recognition of their authority to regulate hunting by both tribal members and nonmembers on their reservations. The guidelines include possibilities for:

(1) On-reservation hunting by both tribal members and nonmembers, with hunting by nontribal members on some reservations to take place within Federal frameworks but on dates different from those selected by the surrounding State(s);

(2) On-reservation hunting by tribal members only, outside of usual Federal frameworks for season dates and length, and for daily bag and possession limits; and

(3) Off-reservation hunting by tribal members on ceded lands, outside of usual framework dates and season length, with some added flexibility in daily bag and possession limits.

In all cases, the regulations established under the guidelines must be consistent with the March 10-September 1 closed season mandated by the 1916 Migratory Bird Treaty with Canada.

In the June 14, 2018, Federal Register (83 FR 27836), we requested that tribes desiring special hunting regulations in the 2019-20 hunting season submit a proposal including details on:

(1) Harvest anticipated under the requested regulations;

(2) Methods that would be employed to measure or monitor harvest (such as bag checks, mail questionnaires, etc.);

(3) Steps that would be taken to limit level of harvest, where it could be shown that failure to limit such harvest would adversely impact the migratory bird resource; and

(4) Tribal capabilities to establish and enforce migratory bird hunting regulations.

No action is required if a tribe wishes to observe the hunting regulations established by the State(s) in which an Indian reservation is located. We have successfully used the guidelines since the 1985-86 hunting season. We finalized the guidelines beginning with the 1988-89 hunting season (August 18, 1988, Federal Register [53 FR 31612]).

The final rule described here is the final in the series of proposed and final rulemaking documents for Migratory Bird Hunting Regulations on Certain Federal Indian Reservations and Ceded Lands for the 2019-20 Season. This rule sets hunting seasons, hours, areas, and limits for migratory game bird species on reservations and ceded territories. This final rule is the culmination of the rulemaking process for the Tribal migratory game bird hunting seasons, which started with the June 14, 2018, proposed rule. This final rule sets the Migratory Bird Hunting Regulations on Certain Federal Indian Reservations and Ceded Lands for the 2019-20 Season.

Each year we publish various species status reports that provide detailed information on the status and harvest of migratory game birds, including information on the methodologies and results. These reports are available at the address indicated under FOR FURTHER INFORMATION CONTACT or from our website at https://www.fws.gov/birds/surveys-and-data/reports-and-publications/population-status.php.

We used the following reports: Adaptive Harvest Management, 2019 Hunting Season (September 2018); American Woodcock Population Status, 2018 (August 2018); Band-tailed Pigeon Population Status, 2018 (August 2018); Migratory Bird Hunting Activity and Harvest During the 2016-17 and 2017-18 Hunting Seasons (August 2018); Mourning Dove Population Status, 2018 (August 2018); Status and Harvests of Sandhill Cranes, Mid-continent, Rocky Mountain, Lower Colorado River Valley and Eastern Populations, 2018 (August 2018); and Waterfowl Population Status, 2018 (August 2018).

For the 2019-20 migratory bird hunting season, we proposed regulations for 31 Tribes or Indian groups that followed the 1985 guidelines and were considered appropriate for final rulemaking. However, at that time, we noted in the July 8, 2019, proposed rule that we were proposing seasons for five Tribes who submitted proposals in past years but from whom we had not yet received proposals this year. We did not receive proposals from four of those Tribes and, therefore, have not included them in this final rule.

The comment period for the July 8 proposed rule closed on August 7, 2019. We received one comment on our July 8 proposed rule, which announced proposed seasons for migratory bird hunting by American Indian Tribes. The commenting individual expressed general support for implementing the tribal regulations.

This action is not subject to the requirements of Executive Order (E.O.) 13771 (82 FR 9339, February 3, 2017) because it establishes annual harvest limits related to routine hunting or fishing.

The programmatic document, “Second Final Supplemental Environmental Impact Statement: Issuance of Annual Regulations Permitting the Sport Hunting of Migratory Birds (EIS 20130139),” filed with the Environmental Protection Agency (EPA) on May 24, 2013, addresses NEPA compliance by the Service for issuance of the annual framework regulations for hunting of migratory game bird species. We published a notice of availability in the Federal Register on May 31, 2013 (78 FR 32686), and our Record of Decision on July 26, 2013 (78 FR 45376). We also address NEPA compliance for waterfowl hunting frameworks through the annual preparation of separate environmental assessments, the most recent being “Duck Hunting Regulations for 2019-20,” with its corresponding July 2019, finding of no significant impact. The programmatic document, as well as the separate environmental assessment, is available on our website at https://www.fws.gov/birds/index.php, or from the address indicated under the caption FOR FURTHER INFORMATION CONTACT .

Section 7 of the Endangered Species Act of 1973, as amended (16 U.S.C. 1531 et seq. ), provides that the Secretary shall insure that any action authorized, funded, or carried out is not likely to jeopardize the continued existence of any endangered species or threatened species or result in the destruction or adverse modification of critical habitat. Consequently, we conducted formal consultations to ensure that actions resulting from these regulations would not likely jeopardize the continued existence of endangered or threatened species or result in the destruction or adverse modification of their critical habitat. Findings from these consultations are included in a biological opinion, which concluded that the regulations are not likely to jeopardize the continued existence of any endangered or threatened species. Our biological opinions resulting from this section 7 consultation are public documents available for public inspection at the address indicated under ADDRESSES .

E.O. 12866 provides that the Office of Information and Regulatory Affairs (OIRA) will review all significant rules. OIRA has reviewed this rule and has determined that this rule is significant because it will have an annual effect of $100 million or more on the economy.

E.O. 13563 reaffirms the principles of E.O. 12866 while calling for improvements in the nation's regulatory system to promote predictability, to reduce uncertainty, and to use the best, most innovative, and least burdensome tools for achieving regulatory ends. The executive order directs agencies to consider regulatory approaches that reduce burdens and maintain flexibility and freedom of choice for the public where these approaches are relevant, feasible, and consistent with regulatory objectives. E.O. 13563 emphasizes further that regulations must be based on the best available science and that the rulemaking process must allow for public participation and an open exchange of ideas. We have developed this rule in a manner consistent with these requirements.

An economic analysis was prepared for the 2019-20 season. This analysis was based on data from the 2011 National Hunting and Fishing Survey, the most recent year for which data are available (see discussion under Regulatory Flexibility Act, below). This analysis estimated consumer surplus for three alternatives for duck hunting (estimates for other species are not quantified due to lack of data). The alternatives are (1) issue restrictive regulations allowing fewer days than those issued during the 2018-19 season, (2) issue moderate regulations allowing more days than those in alternative 1, and (3) issue liberal regulations identical to the regulations in the 2018-19 season. For the 2019-20 season, we chose Alternative 3, with an estimated consumer surplus across all flyways of $334-$440 million with a mid-point estimate of $387 million. We also chose alternative 3 for the 2009-10 through 2018-19 seasons. The 2019-20 analysis is part of the record for this rule and is available at http://www.regulations.gov at Docket No. FWS-HQ-MB-2018-0030.

The annual migratory bird hunting regulations have a significant economic impact on substantial numbers of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ). We analyzed the economic impacts of the annual hunting regulations on small business entities in detail as part of the 1981 cost-benefit analysis. This analysis was revised annually from 1990 through 1995. In 1995, the Service issued a Small Entity Flexibility Analysis (Analysis), which was subsequently updated in 1996, 1998, 2004, 2008, 2013, 2018, and 2019. The primary source of information about hunter expenditures for migratory game bird hunting is the National Hunting and Fishing Survey, which is generally conducted at 5-year intervals. The 2019 Analysis is based on the 2011 National Hunting and Fishing Survey and the U.S. Department of Commerce's County Business Patterns, from which it was estimated that migratory bird hunters would spend approximately $1.5 billion at small businesses in 2019.

Copies of the analysis are available upon request from the Division of Migratory Bird Management (see FOR FURTHER INFORMATION CONTACT ) or from http://www.regulations.gov at Docket No. FWS-HQ-MB-2018-0030.

This final rule is a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act. For the reasons outlined above, this rule will have an annual effect on the economy of $100 million or more. However, because this rule establishes hunting seasons, we do not plan to defer the effective date under the exemption contained in 5 U.S.C. 808(1).

This rule does not contain any new collection of information that requires approval by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ). OMB has previously approved the information collection requirements associated with migratory bird surveys and the procedures for establishing annual migratory bird hunting seasons under the following OMB control numbers:

• 1018-0019, “North American Woodcock Singing Ground Survey” (expires 6/30/2021).

• 1018-0023, “Migratory Bird Surveys, 50 CFR 20.20” (expires 8/31/2020). Includes Migratory Bird Harvest Information Program, Migratory Bird Hunter Surveys, Sandhill Crane Survey, and Parts Collection Survey.

• 1018-0171, “Establishment of Annual Migratory Bird Hunting Seasons, 50 CFR part 20” (expires 06/30/2021).

You may view the information collection request(s) at http://www.reginfo.gov/public/do/PRAMain.

An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number.

We have determined and certify, in compliance with the requirements of the Unfunded Mandates Reform Act, 2 U.S.C. 1502 et seq., that this rulemaking will not impose a cost of $100 million or more in any given year on local or State government or private entities. Therefore, this rule is not a “significant regulatory action” under the Unfunded Mandates Reform Act.

The Department, in promulgating this rule, has determined that this rule will not unduly burden the judicial system and that it meets the requirements of sections 3(a) and 3(b)(2) of E.O. 12988.

In accordance with E.O. 12630, this rule, authorized by the Migratory Bird Treaty Act, does not have significant takings implications and does not affect any constitutionally protected property rights. This rule will not result in the physical occupancy of property, the physical invasion of property, or the regulatory taking of any property. In fact, this rule will allow hunters to exercise otherwise unavailable privileges and, therefore, reduce restrictions on the use of private and public property.

E.O. 13211 requires agencies to prepare Statements of Energy Effects when undertaking certain actions. While this rule is a significant regulatory action under E.O. 12866, it is not expected to adversely affect energy supplies, distribution, or use. Therefore, this action is not a significant energy action and no Statement of Energy Effects is required.

In accordance with the President's memorandum of April 29, 1994, “Government-to-Government Relations with Native American Tribal Governments” (59 FR 22951), E.O. 13175, and 512 DM 2, we have evaluated possible effects on Federally recognized Indian tribes and have determined that there are no effects on Indian trust resources. We have consulted with Tribes affected by this rule.

Due to the migratory nature of certain species of birds, the Federal Government has been given responsibility over these species by the Migratory Bird Treaty Act. We annually prescribe frameworks from which the States make selections regarding the hunting of migratory birds, and we employ guidelines to establish special regulations on Federal Indian reservations and ceded lands. This process preserves the ability of the States and tribes to determine which seasons meet their individual needs. Any State or Indian tribe may be more restrictive than the Federal frameworks at any time. The frameworks are developed in a cooperative process with the States and the Flyway Councils. This process allows States to participate in the development of frameworks from which they will make selections, thereby having an influence on their own regulations.

These rules do not have a substantial direct effect on fiscal capacity, change the roles or responsibilities of Federal or State governments, or intrude on State policy or administration. Therefore, in accordance with E.O. 13132, these regulations do not have significant federalism effects and do not have sufficient federalism implications to warrant the preparation of a federalism summary impact statement.

The rulemaking process for migratory game bird hunting, by its nature, operates under a time constraint as seasons must be established each year or hunting seasons remain closed. However, we intend that the public be provided extensive opportunity for public input and involvement in compliance with Administrative Procedure Act requirements. Thus, when the preliminary proposed rulemaking was published, we established what we concluded were the longest periods possible for public comment and the most opportunities for public involvement. We also provided notification of our participation in multiple Flyway Council meetings, opportunities for additional public review and comment on all Flyway Council proposals for regulatory change, and opportunities for additional public review during the Service Regulations Committee meeting. Therefore, sufficient public notice and opportunity for involvement have been given to affected persons regarding the migratory bird hunting frameworks for the 2019-20 hunting seasons. Further, after establishment of the final frameworks, States and Tribes need sufficient time to conduct their own public processes to select season dates and limits; to communicate those selections to us; and to establish and publicize the necessary regulations and procedures to implement their decisions. Thus, if there were a delay in the effective date of these regulations after this final rulemaking, States and Tribes might not be able to meet their own administrative needs and requirements.

For the reasons cited above, we find that “good cause” exists, within the terms of 5 U.S.C. 553(d)(3) of the Administrative Procedure Act, and this rule will take effect immediately upon publication.

Accordingly, with each participating Tribe having had an opportunity to participate in selecting the hunting seasons desired for its reservation or ceded territory on those species of migratory birds for which open seasons are now prescribed, and consideration having been given to all other relevant matters presented, certain sections of title 50, chapter I, subchapter B, part 20, subpart K, are hereby amended as set forth below.

Accordingly, part 20, subchapter B, chapter I of title 50 of the Code of Federal Regulations is amended as follows:

Background

On December 15, 2017, we published in the Federal Register (82 FR 59564) a proposal to revise 50 CFR part 80, “Financial Assistance: Wildlife Restoration, Sport Fish Restoration, Hunter Education and Safety.” The proposal provided a background for the Department of the Interior's (DOI) U.S. Fish and Wildlife Service (Service) management of financial assistance programs by the Service's Wildlife and Sport Fish Restoration Program (WSFR). The final rule revises title 50, part 80, of the Code of Federal Regulations (CFR). In addition to addressing topics that we identified since the 2011 rulemaking, the final rule includes revisions made to reflect the following laws and policies:

(a) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, 2 CFR part 200, December 26, 2013.

(b) Service Manual chapter 518 FW 1, “Authorities and Responsibilities,” July 25, 2014.

(c) Service Manual chapter 519 FW 2, “Compliance Requirements Summary,” October 29, 2014.

(d) Service Manual chapter 417 FW 1, “Service-Administered Audits of Grantees,” April 26, 2015.

This final rule is not a full update to the regulations. As described in the preamble to the proposed rule, we worked with our State partners to develop a phased approach whereby we would address a limited number of updates over multiple rulemakings, allowing our partners and the public to better engage and respond to changes. This final rule was started as the initial phase of an expected four-phase process. We have since determined that we are not able to accommodate the required process and timing needed to make the phased approach work. We will work with our partners to develop a new approach for the remaining regulatory updates, to include engagement opportunities during the prerulemaking stage.

The final rule is divided into subparts of related subject matter. This final rule only changes one full subpart, that on license certification. Other updates are at various locations within the rule.

We solicited public comments to the proposed rule published December 15, 2017, for 60 days, ending on February 13, 2018. State fish and wildlife agencies are the primary recipients of grants affected by this rule. We received 37 comments in response to the proposed rule from 15 States, several fish and wildlife-related organizations, and the public.

In addition to proposed changes to the rule, in the preamble to the proposed rule we requested feedback on topics that we will consider for future rulemaking. This discussion starts at 82 FR 59566 in the proposed rule. We consider these topics to potentially elicit a variety of responses and offer this as an opportunity to start a national conversation. We will not respond to any comments received from the topics in the preamble, as they are not part of the rule. However, we appreciate all those who took the time to give thoughtful comments and will be using those comments when addressing these topics in the future. They help inform us of needs, opinions, perceptions, and priorities in these programs that are integral to nationwide fish and wildlife conservation and recreation activities.

The following paragraphs discuss the substantive comments received and provide our responses to those comments. The comments are not presented verbatim and where several commenters responded with similar thoughts, we have summarized them as a single comment.

We received 23 general comments from the public. Several commenters expressed support to the changes in general, even when they made suggestions to specific sections of the rule. Some we consider nonsubstantive. This does not mean that the comments provided are not important, but rather that they do not address what is proposed in this rulemaking. We do, however, address some comments that, although they do not relate directly to the content of this rulemaking, do relate to WSFR and State fish and wildlife agency work.

Comment 1: One commenter cited information on the National Dam Safety Act and the importance of partnerships that ensure dam safety.

Response 1: The National Dam Safety Program Act provides funding to States and other agencies with grants administered by the Federal Emergency Management Agency. Policies for administration of those programs are at https://damsafety.org/ManualsAndGuidelines. Dams are real property and, according to our regulations, are titled with the State fish and wildlife agency when purchased through the Wildlife Restoration Program or Sport Fish Restoration Program. Therefore, compliance with State or any applicable Federal laws for dams acquired or built with these funds is the responsibility of the title-holding State agency.

Comment 2: The Wildlife and Sport Fish Restoration Program still bears the name of those Congressmen who crafted the legislation all those years ago. Why is this? The implementing regulations belong to the taxpayer and should not serve as a monument to originating Congressmen.

Response 2: It has been typical throughout Congressional history to name a piece of legislation after the sponsors who championed the action or someone else who inspired the purpose of the legislation. This unofficial naming process is usually done in relation to the specific purpose that the Act supports and is not associated with other aspects of the sponsor's life. Although the original Act does not cite it as the Pittman-Robertson Wildlife Restoration Act, a major piece of legislation since then, Public Law 106-408 Wildlife and Sport Fish Restoration Programs Improvement Act of 2000, does cite both Acts using the sponsors' names. We have no control over how Congress gives titles to Acts. However, we do appreciate and understand your concern.

Comment 3: The public isn't sufficiently engaged in the work and decisions of the State fish and wildlife agency in the commenter's State.

Response 3: We have no control over the State regulatory process nor do we control the administrative processes of the State fish and wildlife agency. We recommend contacting State officials, sharing your concerns, and seeking the various methods that your State offers for engaging in decisionmaking.

Comment 4: Commenters expressed concerns with timber harvesting, the lumber industry, forestry management, and related economic, social issues, and property concerns and, similarly, concerns surrounding endangered species.

Response 4: Although some State fish and wildlife agencies engage in forestry activities as part of wildlife management, neither this rule nor this agency addresses actions relevant to those concerns. The U.S. Forest Service ( https://www.fs.fed.us/ ), under the Department of Agriculture, would be the best contact for information on national forest management. The Service does manage endangered species laws and grant funding, but this rule does not cover those activities directly. For more information on Federal financial assistance for endangered species, visit: https://www.fws.gov/endangered/grants/index.html.

Comment 5: The Service should use funds under the Wildlife Restoration Act for management of all species of wildlife. The Act was written for species that are imperiled and not just for those that are hunted.

Response 5: The original Act authorized cooperation with State fish and wildlife agencies for “wildlife restoration projects” that were defined as “the selection, restoration, rehabilitation, and improvement of areas of land or water adaptable as feeding, resting, or breeding places for wildlife, including acquisition by purchase, condemnation, lease, or gift of such areas or estates or interests therein as are suitable or capable of being made suitable therefor, and the construction thereon or therein of such works as may be necessary to make them available for such purposes and also including such research into problems of wildlife management as may be necessary to efficient administration affecting wildlife resources, and such preliminary or incidental costs and expenses as may be incurred in and about such projects.” State fish and wildlife agencies may use their Wildlife Restoration funds for species under their control that meet the definition of “wildlife” at 50 CFR 80.2. This definition limits eligible species to birds and mammals. Some States have asked that we expand the definition to include species that are hunted in that State, but are not birds or mammals, as these species often need a management plan and those who purchase licenses to hunt those species contribute financially when they purchase a license. The topic of defining wildlife will continue to be considered, and we appreciate this public input.

Comment 6: The regulations don't even really mention Comprehensive Management System grants, but they are a big part of the original legislation. This method seems much more efficient. Are there plans to revisit this issue in a future rulemaking?

Response 6: The original Act (50 Stat. 917, Sept. 2, 1937) does not include Comprehensive Management Plans, but uses the word “plans.” We agree that the Comprehensive Management System for managing financial assistance is a method that more States could employ to administer these programs efficiently and would include periodically seeking public input. We intend to expand this information in a future rulemaking.

Comment 7: The minimum dollar amount for certifying licenses is meaningless at $2. It doesn't reflect market reality. Aren't data available that would allow you to determine an appropriate annual price and standardize a market-based amount?

Response 7: The rules that govern financial assistance (2 CFR part 200) clarify that market value is determined on a very local level. Comparing the cost of similar licenses in different States shows that there is no national consistency, but rather each State sets prices based on the needs and desires of their State fish and wildlife agency and the public. The standard in this final rule was recommended not based on market value of a license, but rather the desire to cover administrative costs of issuing a license and having some license revenue left to the State agency. The intent is simplicity, clarity, and fairness. This standardized method accommodates all States, regardless of the State laws that govern license fees.

Comment 8: A commenter questions the Service's compliance with the Regulatory Flexibility Act (RFA) and the Small Business Regulatory Enforcement Fairness Act (SBREFA).

Response 8: We address both of these requirements in the “Required Determinations” section of the preamble at 82 FR 59568, Dec. 15, 2017. Under the RFA we are required to review and consider how this rule, which governs the administration of these financial assistance programs, economically affects small entities. Under the SBREFA we assess whether the rule will have a significant economic impact on a substantial number of small entities of $100 million or more; cause a major increase in costs or prices; or have significant adverse effects on competition, employment, investment, productivity, or innovation. As the WSFR programs and subprograms transfer money primarily to State fish and wildlife agencies, and the transfer of funds is a benefit to smaller entities that partner with the State agencies, there is no adverse effect to small entities under this rule. It is possible that some Federally funded projects, when complying with other Federal, State, or local laws, could affect small entities, but those instances are outside the purview of this rule.

Comment 9: The Humane Society of the United States emphasizes the importance of engaging with nongovernmental organizations when developing regulations.

Response 9: Executive Order (E.O.) 13563 (Jan. 18, 2011) directs Federal agencies to adopt regulations through a process that involves public participation, including, among other provisions, offering a comment period of at least 60 days.

WSFR is fully compliant with E.O. 13563. Any entities wishing to engage in future prerulemaking opportunities may do so by notifying us using information at FOR FURTHER INFORMATION CONTACT.

Comment 10: This proposed rule contains unanticipated changes.

Response 10: Following feedback from States that addressing the large amount of changes to 50 CFR part 80 in one rulemaking was too burdensome, in April 2016 Service staff approached the Federal/State Joint Task Force on Federal Assistance Policy (JTF) and the Federal Aid Coordinators Working Group (FACWG) with a concept to approach updates using a phased approach. This approach would allow fewer topics per rulemaking and the ability to manage the workload over 18-24 months. The process was agreed to, and the FACWG and Regions nominated members to a Federal/State team that developed a schedule to include timing and suggested topics for each phase. The schedule was shared in September 2016 without objection, but was delayed by a few months as the topic of license certification, which was scheduled to be published as a separate rulemaking, was close to being ready to go into a proposed rule. We worked with the JTF and the Association of Fish & Wildlife Agencies (AFWA) to finalize the concepts of license certification changes and added the revised subpart to the proposed rule already developed as Phase 1. Unfortunately, the proposed rule was administratively delayed, and we were unable to maintain the recommended phased schedule for rulemaking. During the delay, much communication focused on license certification and did not reiterate all proposed changes. We will engage our partners more effectively in the future when preparing for further rulemaking.

(1) Asset —New definition.

Comment 11: It is unnecessary to define “Asset” as it is already defined at 2 CFR 200.12.

Response 11: The definition at 2 CFR 200.12 is for a “capital asset,” which is a subset of the term “asset.” However, we agree that we should reference back to 2 CFR part 200 and align for ease of grant administration. We added to this definition the reference for capital asset, as it defines criteria for a capital asset. We also added the reference for equipment at 2 CFR 200.33, as it defines criteria for equipment as an asset. We also clarify that real property of any value is an asset.

Comment 12: This expansive definition could cause States considerable challenges related to control of assets. Section 80.90(f) requires States to maintain control of all assets acquired under the grant to ensure they serve the purpose for which acquired throughout their useful life. However, a useful life is only determined for those items meeting the threshold of equipment or capital improvement. This new definition opens the door for audit findings over very minor items. Another commenter is concerned this definition is overly broad and vague and asks if there is a threshold for monetary value.

Response 12: Response 11 explains that some assets that are defined under 2 CFR part 200 have criteria that contain certain thresholds. We define the term “asset” to clarify that it can mean: (1) Either tangible (physical in nature) or intangible (not physical in nature, such as software, licenses to operate, copyrights, or usage rights), (2) Real or personal property, and (3) Must have a monetary value.

This definition is applied in § 80.90(f) where an agency is required to have “Control of all assets acquired under the grant to ensure that they serve the purpose for which acquired throughout their useful life.” In § 80.2 we define useful life as “the period during which a federally funded capital improvement is capable of fulfilling its intended purpose with adequate routine maintenance.” We further define capital improvement as amended “(i) A structure that costs at least $25,000 to build or install; or (ii) The alteration or repair of a structure, or the replacement of a structural component, if it increases the structure's useful life by at least 10 years or its market value by at least $25,000.” So, when applying the term “asset” under 50 CFR 80.90(f), it relates to capital improvements and not minor items.

(2) Capital improvement —Updated definition. We received nine comments concerning the definition; four expressed support.

Comment 13: A commenter recommends an even higher threshold of $50,000.

Response 13: We have no basis to increase the threshold to $50,000. The $25,000 threshold is based on the limits on real property appraisals at 49 CFR 24.102(c) and other sources. We increased the threshold from $10,000 to $25,000 in the Boating Infrastructure Grant Program rule (80 FR 26150, May 6, 2015) and intend to apply the increased threshold to all WSFR-administered programs.

Comment 14: The paragraph in the 2011 rule that allows States to set their own definition for capital improvement was removed in the proposed rule and should be included in the final rule.

Response 14: We agree. This was an omission on our part, and we have added the paragraph back to the definition.

(3) Geographic location —New definition.

Comment 15: We received multiple comments on this proposed definition. Some suggest that it doesn't allow for “Statewide,” regional areas, or multiple counties to be chosen, hampering the scope of projects where it is applicable. Others suggest that limiting reference to U.S. Geological Survey quadrangles doesn't allow for other identifiers and possible new technology for identifying location. Others were concerned that the language used (Ex: parcel) implies this is only for real property work.

Response 15: We agree with some of the suggestions and considered making changes in the final rule to reflect concerns. However, due to the wide variety of comments received and the connection to upcoming work for performance reporting, we decided to delay addressing this definition for future rulemaking consideration.

(4) Match —Updated definition.

Comment 16: Match is already defined in 2 CFR 200.29 and should be removed.

Response 16: We disagree that the definition should be removed from this rule, but agree that it should better align with the 2 CFR part 200 definition. We make changes based on this comment.

Comment 17: All definitions for match are confusing and make it appear that match must be only in-kind.

Response 17: To improve clarity, we make changes that clearly distinguish that cash and in-kind may both be used for match.

Comment 18: Commenters had concerns with the definition including a threshold for useful life as well. How should we respond to an improvement on a structure that originally didn't meet the $25,000 threshold, but has its useful life extended by at least 10 years? It does not seem logical that increasing its useful life by any number of years would make it become a capital improvement.

Response 18: At 2 CFR 200.12, capital assets are defined as tangible or intangible assets used in operations having a useful life of more than 1 year which are capitalized in accordance with generally accepted accounting principles. Capital assets include land, buildings (facilities), equipment, and intellectual property as well as additions, improvements, modifications, replacements, rearrangements, reinstallations, renovations or alterations to capital assets that materially increase their value or useful life. So, regardless of the cost, if it has a useful life of greater than 1 year and is capitalized as an asset, it is a capital asset. The regulations at 2 CFR 200.13 state that a capital expenditure for improvement to land and buildings includes both increase in material value and increase in useful life. The regulations at 2 CFR part 200 do not specify what those limits are, but we set reasonable thresholds in this rule—material value being $25,000 and increase in useful life being 10 years. So, yes, it is possible for an asset that did not originally cost $25,000 or more and was therefore not a capital improvement, to be improved to extend the useful life by 10 or more years and it would then be a capital improvement.

Comment 19: A commenter suggested that “or its market value by at least $25,000” be removed from the proposed definition. Market value is not needed if capital improvement is largely dependent on expenditure threshold.

Response 19: We disagree. As stated in Response 18, the regulations at 2 CFR part 200 are vague on thresholds, but we set thresholds in this rule. The regulations in 2 CFR part 200 call for both material value and useful life, so it is appropriate to include market value at the higher $25,000 threshold.

(5) Obligation —New definition. One comment was received supporting this definition. We make no changes from the proposed rule.

(6) Real property —Updated definition.

Comment 20: Clarify the use of “some” in the sentence that states, “Examples of real property include fee, and some leasehold interests, conservation easements, and mineral rights.”

Response 20: We agree that a better explanation would be beneficial, and we replaced the second sentence with the following: “Examples of real property include fee, conservation easements, access easements, utility easements, and mineral rights. A leasehold interest is also real property except in those States where the State Attorney General provides an official opinion that determines a lease is personal property under State law.” In order for lease to be considered personal property, the Solicitor's Office of the Department of the Interior must be able to concur with this opinion.

Comment 21: A commenter objected to the change in language from “the air space above the parcel, the ground below it,” to “the space above and below it.”

Response 21: The grammatical change clarifies the sentence and restates the definition to reflect the traditional legal real property definition. We make no change based on this comment.

Comment 22: Define the terms lease, license, and permit to make the definition of “real property” more understandable.

Response 22: The term “lease” is defined at § 80.2 under the term “Lease,” the term “license” is defined at § 80.2 under the term “Personal Property” in paragraph (2)(iii). The term “permit” is defined on the Service's website for permits that the Service issues and is explained as, “Permits enable the public to engage in legitimate wildlife-related activities that would otherwise be prohibited by law. Service permit programs ensure that such activities are carried out in a manner that safeguards wildlife. Additionally, some permits promote conservation efforts by authorizing scientific research, generating data, or allowing wildlife management and rehabilitation activities to go forward.” ( https://www.fws.gov/permits/index.html ) We suggest a definition that is broader, as it would be applied by multiple non-Service entities: “A permit is a written authorization that allows a specific person, agency, or other entity to do something that is not forbidden by law, but is not allowed without the permit. The purpose of permits is usually to help ensure that the permittee is aware of and complies with certain laws, regulations, and conditions. Other purposes may be to raise revenue or prevent overuse of an area or a resource. The term is most often applied to an authorization issued by a governmental entity.” We will consider adding a definition in a future rulemaking.

(7) Structure —New definition.

Comment 23: Commenters found this definition either unnecessary or confusing.

Response 23: Due to the negative comments received and no pressing need for this definition, we decided to delay addressing this definition for future rulemaking consideration.

(8) Technical Assistance —New definition. Several commenters support this definition as being helpful in differentiating technical assistance from management assistance.

Comment 24: Commenters recommend the term be “technical guidance” instead of “technical assistance.” Several commenters expressed concerns that the definition is limited by targeting technical assistance to members of the public and on private lands. These commenters indicate that the definition needs to be expanded.

Response 24: A small team working on a policy topic developed this definition for technical assistance, but it is clear from comments received that we should review it with other partners before putting it in regulation. A larger review will ensure it meets the needs and expectations of grantees. We will delay including it in regulation for future rulemaking consideration, but will still include technical assistance as a new, eligible activity under 50 CFR 80.50 and 80.51. We believe that most grantees understand that technical assistance does not include actual on-the-ground management activities and will continue that approach.

Comment 25: Commenters strongly supported this subpart. Several commenters stated that they believe the changes will clarify and simplify the process; that even if certain license types are limited short term, the benefits outweigh this over the long term; and that the new standards are reasonable and attainable.

Response 25: We appreciate the support and the work done within a Federal/State partnership to achieve consensus on this change.

We made no proposed changes to this section and received no comments. No change.

We made no proposed changes to this section and received no comments. No change.

We made no proposed changes to this section and received no comments. No change.

Comment 26: The language in this section was changed to say that a license holder is to be counted in the certification period in which the license is “sold” instead of when “first valid.” The “sold” language was problematic in the past and corrected in the 2011 rulemaking. Changing back to the old language brings the problems back. It is possible for individuals to purchase one annual license during the certification period and the next license ahead of time, but also in the same certification period. Therefore, it is imperative to use language that reflects the period for which the license is valid.

Response 26: We agree and make the change.

Comment 27: We accept the concept of license holders voluntarily purchasing a license, even if they do not participate in the activity. However, we do not agree with individuals being “forced” to purchase a license for an activity that they do not want, but that they must do in order to obtain the license that they want.

Response 27: The commenter is referring to States that do not offer individual options for all license types and combine privileges under one license purchase, even if the license holder does not want and/or need the second privilege. We have no control over this process, as these are State decisions, and we will not restrict a State's ability to issue licenses that require a license that gives the license holder more than one privilege, even if the additional privilege is unwanted or unneeded. As long as the license holder meets the requirements of this rule, they may be certified in the license certification period for each valid privilege.

Comment 28: We disagree with allowing States to sell only combination hunting and fishing licenses and not offer them individually. Is it the intent of the rule to allow this and to then allow those States to count each license sold as both a hunting license holder and a fishing license holder?

Response 28: It is the intent of the rule to make it clear that a State may only count an individual once during a certification period as either a hunting license holder or a fishing license holder. For example, if a State sells an individual both a small game license and a big game license, they are only counted once. However, if a State sells a combination hunting and fishing license, they may count them once as a hunter and once as an angler. This is true whether the individual chooses to purchase a combination license, or whether it is the only option offered by the State. It is not the intent of the rule to tell States whether or not they can require a license holder to purchase a combination hunting and fishing license without an option to purchase each individually.

Comment 29: Commenters expressed support for the new standard, but some concerns over the date when the standard would be required.

Response 29: We agree that the effective date needs to be changed and we did so. We make changes to encourage a State to adopt the new standard as soon as possible, but also to allow a State 2 years from the effective date of the rule to adopt the new standard. This will allow States that need to revise legal requirements, policies, or documents sufficient time to do so.

Comment 30: Under the new standard our State would have more than 375,000 license holders we would not be able to count, resulting in a loss of millions of dollars in apportionments.

Response 30: After consulting with AFWA, an organization that represents all States and State Directors, they agree that giving States 2 years to make changes to bring licenses up to the minimum standard is fair and sufficient. The minimum standard of $2/year/privilege or $4/year for combination licenses is very low and should be able to be attained by States in order to count most licenses. If a State chooses to offer free licenses to certain groups, that is the State's choice and they will do so knowing that these license holders cannot be counted. However, we wish to point out that, in 50 CFR 80.20, “What does revenue from hunting and fishing licenses include?”, hunting and fishing revenue includes not only licenses, but also State-issued permits, stamps, and tags. So, if, for example, a State offers a free hunting license to veterans and that is all they have, they cannot be counted. However, if they were to purchase a permit, stamp, or tag for $2 or more, then they can be counted as they have met the minimum standard to be counted as a hunting license holder.

Comment 31: Question about a license that sells for $2.90, but $1.00 of that goes to the issuing agent and is taken by the agent prior to depositing in the agency account: Would these licenses meet the standard?

Response 31: Yes, they would meet the standard. The $2 amount for the standard is based on research a committee authorized by AFWA conducted on the average costs to issue a license and have some income received by the State fish and wildlife agency. This research was used as the basis for determining a fair and acceptable minimum amount. It is understood that the ratio of costs associated with issuing a license vs. the amount of license revenue received varies depending on license types and States. It is important to remember that we are no longer applying the term “net revenue.” In the scenario described in the comment, the State fish and wildlife agency receives $2.90 and has made arrangements to pay the issuing agent in the manner described. On the State's website, they list the price of the license as $2.90. How the State manages the accounting and payment for services to issue the license, whether they deposit to an agency account and pay the issuing agent, or have the agent take it off the top, is an accounting process/preference and does not affect the gross amount of the license. Therefore, we consider that the State fish and wildlife agency under these circumstances has met the new standard.

In addition to addressing comments from the public for this section, we further reviewed the section and change the final paragraph (§ 80.35(g) in the final rule) to delete the requirement for States to obtain the Director's approval of its proposed technique to decide how many multiyear license holders remain alive in the certification period. A State fish and wildlife agency must use and document a reasonable technique, but does not need Director's approval.

We removed § 80.35(b) as explained in Response 34. As a result, we redesignate paragraphs (c) through (i) as paragraphs (b) through (h). At the newly designated § 80.35(b)(1) and (2), we inform States how to address converting multiyear licenses sold under the final rule that was effective August 31, 2011, to the new standard. At § 80.35(b)(1), we address those States that have invested the revenue collected for the license and held the funds as principle in the investment, not spending any of the amount collected. In this scenario, they have met the prior net revenue requirement through dividends from the investment and not from the revenue collected. Therefore, they may apply the entire amount of the revenue collected using the new standard from the effective date of this final rule forward. At § 80.35(b)(2), we address those States that have invested the revenue collected for the license and that revenue has been spent, in part or in full. In this scenario, they must use the formula described to deduct the amount that would have been accounted for under the new standard from the time the license was sold until the time the State adopts the new standard. This is primarily for multiyear licenses that were sold under the rule effective August 31, 2011, due to the additional qualifications for net revenue, but may be applied to any multiyear licenses sold under 50 CFR part 80 regulations that required net revenue and that are managed under an investment strategy to meet those net revenue requirements.

Comment 32: A commenter supports allowing 80 years as a default for determining life expectancy for multiyear licenses.

Response 32: We hope that allowing this additional option will help some States to reduce burdens for tracking multiyear licenses.

Comment 33: There is a math error in the example given.

Response 33: We agree and correct the error.

Comment 34: Adjust § 80.35(b) to allow States to start counting a valid multiyear license that meets the new standard, even if it was not able to be counted in the annual license certification the year before this final rule is effective. This would be a reasonable and appropriate way to address the drastic inconsistency in the 2011 rule from the previous rule and the fairer, consistent standards now being presented.

Response 34: We reviewed prior versions of 50 CFR part 80 regarding multiyear licenses and found the following information:

In 1982: 50 CFR 80.10(c)(2) states, “Licenses which do not return net revenue to the State shall not be included. To qualify as a paid license, the fee must produce revenue for the State. Net revenue is any amount returned to the State after deducting agent or sellers fees and the cost for printing, distribution, control or other costs directly associated with the issuance of each license. (3) Licenses valid for more than one year, either a specific or indeterminate number of years, may be counted in each of the years for which they are valid; provided that: (i) The net revenue from each license is commensurate with the period for which hunting or fishing privileges are granted.”

In 2008: 50 CFR 80.10(b)(4) states, “The State may count persons possessing a multiyear license (one that is legal for 2 years or more) in each State-specified license certification period in which the license is legal, whether it is legal for a specific or indeterminate number of years, only if: (i) The net revenue from the license is in close approximation with the number of years in which the license is legal.”

In 2011: 50 CFR 80.35(b) states, “The agency must receive net revenue from a multiyear license that is in close approximation to the net revenue received for a single-year license providing similar privileges.”

This history shows the change in the 2011 version that expanded beyond value per year to comparing the annual revenue of a multiyear license with the cost of a comparable annual license. We agree that this shift added a layer of complexity that we are resolving in this rulemaking. We also understand that including the language in the proposed rule at § 80.35(b) penalizes those multiyear licenses that were adversely affected by the 2011 change. In order to truly simplify license certification and allow for future consistency for all States' multiyear licenses, we agree with the commenter and remove this paragraph in the final rule.

Comment 35: Some States may believe that under § 80.35(b) they are required to continue to carry forward some of the burdensome requirements for multiyear licenses needed to comply with current or past versions of the regulations.

Response 35: We agree that it should be clear that State fish and wildlife agencies may stop using past methods for accounting for multiyear licenses that may be burdensome and complicated. We allow at § 80.35(a) that State agencies must begin following the new standard for multiyear licenses sold before and after the effective date of this final rule, and at § 80.35(c) we describe how to assign value to multiyear licenses sold before adopting the new standard. The only exception would be if a State identifies financial or operational harm and follows the exception at § 80.35(c). We agree that § 80.35(b) led to confusion on this point and have removed it from the rule, redesignating the paragraphs accordingly.

Comment 36: Has the Service considered whether, if a combination license does not meet the standard of $4 for a combination license, it may be counted at all? For instance, what if the cost of a combination license is $3?

Response 36: Yes, the Service has considered this issue. As the privilege to hunt and the privilege to fish would both be included in the license, a State fish and wildlife agency that does not meet the minimum standard for a combination license may choose to certify those licenses as either hunting licenses only, fishing licenses only, or a combination of hunting only and fishing only as long as the numbers do not exceed total licenses sold and meet all other regulatory requirements. For example, if a State sold 1,000 combination licenses for $3 each, it could certify 1,000 as hunting licenses only; or it could certify 1,000 as fishing licenses only; or it could certify 500 as hunting licenses only and 500 as fishing licenses only.

Comment 37: Many States are using multiyear licenses as a tool in efforts to recruit, retain, and reactivate hunters and anglers. The language at § 80.35(b) does not support these efforts, and sportsmen and sportswomen would be discouraged to discover that their State is unable to count them as valid license holders in annual certifications due to the restrictive nature of the rule issued in August 2011.

Response 37: We agree and have removed this paragraph as described in Response 34.

We received no comments on this section of the proposed regulations and made no changes in the final rule.

Comment 38: We advocate that under these circumstances the State must show how much the purchaser is paying for each privilege. That way, it is clear that neither privilege is being offered “free.” Some States may force an additional privilege where the result is the ability to count an additional license holder for which it has not received additional funds. For instance, a big game license is offered for $100, and a big game/fishing license is also being offered for $100. We believe that the opportunity to purchase both licenses separately must exist at a higher price to show it is truly a discount.

Response 38: See Response 28. How a State determines to sell their hunting and fishing licenses is a State decision. As long as they meet the standard at § 80.34, they may count the licenses accordingly.

We received no comments on this section of the proposed regulations and made no changes in the final rule.

We received no comments on this section of the proposed regulations and made no changes in the final rule.

We received no comments on this section of the proposed regulations and made no changes in the final rule.

We received no comments on this section of the proposed regulations and made no changes in the final rule.

Comment 39: A commenter objected to adding “acquire equipment” as an additional activity and the associated requirements to consider lease vs. purchase. Section 80.50(a)(6) already allows acquiring equipment, so this provision seems redundant. Also, acquiring equipment is not an activity, but a tool to implement activities. Consider 2 CFR 200.313, 200.439, and 200.318 and the correlation with the addition of lease vs. purchase consideration in the rule.

Response 39: We agree that having equipment listed in two different paragraphs in this section is redundant and unclear. We therefore strike the addition of the proposed § 80.50(a)(14) and add under § 80.50(a)(6) a new paragraph (iii) that directs grantees to refer to 2 CFR part 200 when making decisions for equipment, goods, and services. The regulations at 2 CFR 200.313(a)(1) refer to conditions of title once equipment is acquired, but supports the need for equipment to serve an authorized purpose. Sections 200.313(a)(2) and 200.439(b)(1) and (2) clarify that acquiring equipment requires prior written approval from the awarding agency. Section 200.318(d) clearly states for non-State entities, “The non-Federal entity's procedures must avoid acquisition of unnecessary or duplicative items. Consideration should be given to consolidating or breaking out procurements to obtain a more economical purchase. Where appropriate, an analysis will be made of lease versus purchase alternatives, and any other appropriate analysis to determine the most economical approach.” In addition, § 200.301 requires that non-Federal entities must relate financial data to performance accomplishments of the Federal award and demonstrate cost-effective practices. Section 200.404 discusses reasonable costs. It is expected that this requirement of the grant proposal would address lease vs. purchase, as well as other cost elements. Section 200.405 discusses allocable costs and how to manage acquired equipment and other costs if they would support multiple purposes.

We would expect that a lease vs. purchase analysis would primarily be needed for short-term equipment needs. Specialty equipment, where lease is not an option, and equipment for long-term use may be justifiable. We believe most grantees already consider these and other options when acquiring equipment and include this as part of their standard procurement processes, so there will be very few adjustments needed. We therefore leave this specific direction out of the final rule and point to 2 CFR part 200 for guidance.

Comment 40: Use the term “Provide” for technical assistance instead of “Give.”

Response 40: We did not use the term “provide” in the proposed rule as that term is considered bureaucratic and not plain language. However, because a few commenters recommended this change, we have done so in this final rule and will consider in a future rulemaking if another word might be substituted. We agree that the most important thing to consider is making rules clear and understandable.

Comment 41: We received several comments supporting adding payments in lieu of taxes (PILT) as eligible, and others that question including it.

Response 41: Before April 17, 2009, payments in lieu of taxes were considered allowable only in proportion to the amount contributed by a WSFR award to the total cost of acquisition. This policy was stated in Federal Aid Policy memorandum 84-3, dated Dec.12, 1983, which no longer has any official status as policy. The WSFR Policy Branch reinterpreted this issue on April 17, 2009, in response to a State's challenge of an audit finding that payments in lieu of taxes are unallowable if the lands in question had not been acquired under a Federal award. This reinterpretation is consistent with the revision of 50 CFR part 80 in August 2011 and the implementation of 2 CFR part 200 on Dec. 26, 2014, and also emphasizes that PILT is eligible only if the PILT requirements are applied uniformly across all State land management agencies, and only for that portion of PILT not paid by other sources of revenue. This approach protects State fish and wildlife agencies and WSFR funding from unfair costs. We can also reference Corrective Action Plan for the Inspector General's audit report 2003-36, E-0007 2001-2003 for the period July 99-Oct 01, and the white paper on PILT revised in April 2015. In some States these payments are required by law, and this provision clarifies that these payments may be made using WSFR funds without conflict. States are not required to make payments in lieu of taxes when there is no legal obligation to do so. We are moving this policy that has been in effect for 9 years into regulation. Supporting information is posted on the FA Wiki at: https://fawiki.fws.gov/display/WSFR/Payment+in+Lieu+of+Taxes+%28PILT+or+PILOT%29+-+WSFR.

Comment 42: Use the term “acquire” instead of “buy” when referring to equipment and real property.

Response 42: We agree and make applicable changes in the final rule.

Comment 43: Include “acquire real property for firearm and archery ranges” under both Basic Hunter Education and Enhanced Hunter Education programs.

Response 43: We agree and make the change.

Comment 44: Some of the items listed in this section are activities and others are items that support activities. Perhaps more thought can be given on how to present this information.

Response 44: We appreciate this comment and will thoughtfully consider how we present this information as part of a future rulemaking.

The additional eligible items we proposed at § 80.51 that apply to the Sport Fish Restoration Program are the same additions as we proposed at § 80.50 for the Wildlife Restoration Program, except for Hunter Education. No unique comments were received for this section. We received comments on the addition of equipment and the requirement to consider purchase vs. lease (see Comment and Response 39), which we address similarly by removing proposed § 80.51(a)(14) and adding paragraph (iii) to § 80.51(a)(8). We received comments to change “Give” to “Provide” at § 80.51(a)(12) (see Comment and Response 40), and we ensured that we use the term “acquire” instead of “buy” regarding equipment (see Comment and Response 42). We also received comments regarding payment in lieu of taxes (see Comment and Response 41).

We discuss comments on the proposed revisions and provide responses below. The decisions we make in addressing these comments collectively results in no changes from the current regulations.

Comment 45: The sentence at § 80.56(a), “Projects may have very different components and still be substantial in character and design,” appears to serve no purpose, or is at least unclear what the purpose is.

Response 45: We have received information that indicates that States have been breaking projects apart and submitting separate grants for different components of a project because of the perception that a project that contained various components—for example, a land acquisition, construction, and operation and maintenance—would not be viewed together as substantial in character and design if all were included in one grant proposal. Adding this sentence was intended to clarify that these projects may be included in one grant proposal, if a State chooses to do so, and still meet the requirement for being substantial in character and design. As this is not a requirement and did not lend the expected clarity, we remove this sentence and will manage administratively. If States have questions they should contact their Regional WSFR Office.

Comment 46: Remove the word “measurable” from § 80.56(b)(2): “States a purpose and sets measurable objectives, both of which you base on the need.” One commenter stated it is not needed because the word “quantified” is used at § 80.82(b)(3) when defining objectives. One commenter questioned if this was intentional and, if so, how a research project would be measured. Other comments stated that not every grant objective can be defined in measurable terms and States should be given flexibility when determining objectives.

Response 46: We disagree that the inclusion of the word “measurable” doesn't add value and suggest that it supports the concept of substantial in character and design. This is also supported by the requirements at 2 CFR 200.301, “Performance measurement,” that state, “The recipient's (grantees) performance should be measured in a way that will help the Federal awarding agency and other non-Federal entities to improve program outcomes, share lessons learned, and spread the adoption of promising practices.” Tracking and Reporting Actions for the Conservation of Species (TRACS) is the tracking and reporting system for conservation and related actions funded by the WSFR Program. A Federal/State team called the TRACS Working Group was established in May 2014, in part to set national standards for what information States would enter into TRACS. One of the agreed standards is Specific, Measurable, Achievable, Relevant, and Time Bound (S.M.A.R.T.) objectives. However, we will remove the word “measurable” in this section and consider adding all S.M.A.R.T. objective components in a future rulemaking. We will also consider in a future rulemaking if changes should be made at § 80.82(b)(3) or other sections of the rule to better align information and requirements.

Regarding research projects, 2 CFR 200.76, “Performance goal,” gives some further guidance for this when stating, “Performance goal means a target level of performance expressed as a tangible, measurable objective, against which actual achievement can be compared, including a goal expressed as a quantitative standard, value, or rate. In some instances ( e.g., discretionary research awards), this may be limited to the requirement to submit technical performance reports (to be evaluated in accordance with agency policy).” The regulations at 2 CFR 200.87 define “research” as “a systematic study directed toward fuller scientific knowledge or understanding of the subject studied.” The regulations at 2 CFR 200.210(d) explain as Federal Award Performance Goals that “The Federal awarding agency must include in the Federal award an indication of the timing and scope of expected performance by the non-Federal entity as related to the outcomes intended to be achieved by the program. In some instances ( e.g., discretionary research awards), this may be limited to the requirement to submit technical performance reports (to be evaluated in accordance with Federal awarding agency policy). Where appropriate, the Federal award may include specific performance goals, indicators, milestones, or expected outcomes (such as outputs, or services performed or public impacts of any of these) with an expected timeline for accomplishment. Reporting requirements must be clearly articulated such that, where appropriate, performance during the execution of the Federal award has a standard against which non-Federal entity performance can be measured.” Whatever the focus of the award, it is clear that there must be some measurable objective, but that depending on the project there is flexibility in what the measure might be.

Comment 47: The evaluation of cost effectiveness is relative and requires consideration of many variables. This is likely to be arbitrary if determined by WSFR staff. True cost effectiveness should be evaluated by economists, which would be a burden. Moreover, many wildlife-related activities are valued in non-financial ways, making it even more difficult.

Response 47: The requirements at 2 CFR 200.301 include, “the Federal awarding agency must require the recipient [grantee] to relate financial data to performance accomplishments of the Federal award. Also, in accordance with above mentioned standard information collections, and when applicable, recipients must also provide cost information to demonstrate cost effective practices.” We are not requiring that recipients engage economists to determine this measure, but that they consider and address as appropriate for the award. Cost-effectiveness does not necessarily mean using the cheapest option, as the cheapest option might not be the best for a successful project. Cost-effectiveness may consider multiple benefits, including those that are values driven. Cost considerations may also determine that paying more for something because it will improve useful life, management, accessibility, etc., is a good investment. We considered alternative language to explain cost-effectiveness, but believe that States are already addressing this issue when showing costs are necessary and reasonable, which supports a project being substantial in character and design. No changes are made based on this comment.

Comment 48: We are uncertain as to whether at the proposed § 80.82(c)(10), “Budget Narrative,” the schedule of payments for projects that use funds from two or more annual apportionments is meant to apply to the acquisition of capital improvements and equipment, or if it is meant to apply to all projects. It is typical for our State to write 2-year grants for our projects with status of available fund conditions. The exact funding of these projects is never determined until the apportioned funds are available. This has been an efficient method of managing the apportionment, and we would not want to have to in advance determine apportionment allocation among other grants.

Response 48: The content at § 80.82(c)(10) was not changed from the current rule. Rather, this subparagraph was reformatted to pull out the three items under Budget Narrative as (i), (ii), and (iii), instead of a single sentence. We understand that a budget is an estimate and certain projections are made, and that available funds in a future grant period could alter a multiyear budget. As this section is not changed, there is no requirement to make changes in current, approved procedures.

Comment 49: Why do you propose separating “Purpose” and “Objective?” If it is related to real property and the purpose for which land is acquired, we recommend addressing this in the real property chapters instead of the rule.

Response 49: We separate purpose and objective to clarify that they are two discrete concepts that have often been addressed as a single concept. This clarifies what information each is intended to convey. The regulations at 2 CFR part 200 demonstrate a preference for using the term “objective” in relation to costs, and for using “goal” as we use the term “objective”; however, “objective” is used at various locations when discussing project or program objectives. The regulations at § 200.76 state, “Performance goal means a target level of performance expressed as a tangible, measurable objective, against which actual achievement can be compared, including a goal expressed as a quantitative standard, value, or rate,” aligning “goal” to “objective” and not relating it to purpose. In several locations at 2 CFR part 200, performance is measured in relation to whether goals/objectives are achieved, so it is important to clearly define objectives.

Comment 50: A commenter suggests editing § 80.82(c)(9)(iv) to read as follows: “Indicate whether the agency wants to treat program income that it earns after the grant period as either: (a) License revenue; or (b) additional funding for purposes consistent with the grant terms and conditions or program regulations” ( i.e., adding the phrase “as either”). This would help eliminate confusion.

Response 50: We agree this language should be clarified and make changes.

Comment 51: At § 80.82(b)(10)(ii), if the State agency's threshold for capital improvement is less than the amount defined at § 80.2, is prior approval required?

Response 51: No. If a capital improvement meets the State agency standard, but is lower than the standard in this rule, prior approval is not required.

Comment 52: Clarify the term “in-kind,” as it is not consistently understood and often misused.

Response 52: Although we had proposed revisions to § 80.85, we have decided not to change this section in this final rule. Instead, we adjust the definition of “match” at § 80.2 to better align with 2 CFR part 200 and to address this concern.

Comment 53: We received several comments in regard to this section:

(1) Clarify that this section refers to State fish and wildlife agency rates for equipment it owns.

(2) Clarify at § 80.97(b) in the second sentence that “agency” refers to the State agency.

(3) Using U.S. Army Corps of Engineers rates has proven to be problematic, and we suggest additional resources be devoted to identifying alternative, practical methods.

(4) This section appears to be in conflict with 2 CFR part 200.

(5) State fish and wildlife agencies work with multiple Federal agencies and having different rules for each agency is problematic.

(6) This part of the rule is very restrictive to State fish and wildlife agencies.

(7) Sometimes another State entity outside the fish and wildlife agency is involved in the process, which makes it complicated.

(8) Requiring a State fish and wildlife agency to develop its own rates is an unfair burden.

(9) We question the disparity between State fish and wildlife agencies and subgrantees.

(10) This is the first official specification we have seen requiring a by-agency rate.

(11) It is unclear how a State fish and wildlife agency cannot charge costs of equipment to another grant but can charge operating costs to a future grant.

(12) We do not understand why another State agency cannot establish a rate that we can then use.

(13) We recommend that the Federal agency develop rates for States to use.

Response 53: WSFR first issued guidance on this topic on December 23, 2014, to comply with the requirements at 2 CFR part 200 (see Comment 53, item 10). We received comments from States that indicated it was an extreme burden for subgrantees that are small entities to develop their own rates, so we updated the guidance on October 21, 2016, to allow greater flexibility for subgrantees. The major difference for subgrantees is allowing them to use the State fish and wildlife agency rate, instead of having to determine their own rate. This still meets all the criteria under 2 CFR part 200 (see Comment 53, item 9). Once established, these equipment rates should be accepted by any other Federal programs in which a State fish and wildlife agency may participate, as if done properly they will fully comply with 2 CFR part 200 (see Comment 53, items 5 and 6). It is acceptable for a Statewide administrative agency to set rates, as long as when setting rates for the State fish and wildlife agency they only consider equipment types that are typical for use by the State fish and wildlife agency. A generic Statewide rate would include specialty equipment from other State agencies that could inappropriately proportion costs to the State fish and wildlife agency. In contrast, State fish and wildlife agencies also use specialty equipment that should be appropriately considered when determining rates, so that the agency receives sufficient credit for specialized equipment. A Statewide administrative entity should be fully equipped to perform this type of assessment (see Comment 53, items 7 and 12).

Regarding burden, we clarify here that, once established, rates should be valid for several years and the base analysis would serve to make any future updates easier to accomplish (see Comment 53, item 8). Regarding other, alternate resources for determining rate schedules, according to 2 CFR part 200, rates must reflect local market rates and equipment that agencies use, so a strictly national rate would not comply with 2 CFR part 200. If a State were to identify a rate schedule developed by an organization or entity that it feels might comply with 2 CFR part 200 and be used instead of their self-determined rates, WSFR Headquarters staff will, upon request, review to determine if it complies. However, WSFR does not have the resources to independently set forth on a project to set and update local rates for all States (see Comment 53, items 3 and 13). Comment 53, item 11, seeks clarity on process and comment 53, items 1 and 2, recommend edits. However, due to the apparent need for additional education and understanding on this topic, we have determined not to include these proposed changes in the final rule. We will continue to follow the current WSFR guidance and 2 CFR part 200. We will evaluate the issue and associated needs and communicate with State fish and wildlife agencies for additional opportunities to better understand these requirements.

We received no comments on this section of the proposed regulations and made no changes in the final rule.

We amend § 80.120(c)(5) to align with 2 CFR 200.307(d).

Comment 54: At § 80.120(b)(5) hunter education course fees are listed as program income, but at § 80.120(c)(3) cash received for incidental costs is not program income. These are not clearly distinguished and could cause confusion. One commenter thought we were removing § 80.120(c)(3), which we are not.

Response 54: We accept the comments requesting further clarity. We added a sentence to § 80.120(a) after defining program income to include, “Upon request from the State agency and approval of the Service, the option at 2 CFR 200.307(b) may be allowed.” This option is: “If authorized by Federal regulations or the Federal award, costs incidental to the generation of program income may be deducted from gross income to determine program income, provided these costs have not been charged to the Federal award.” This provision clarifies that a State agency may choose to apply net program income instead of gross program income. We expanded § 80.120(b)(5) to include fees collected by the agency for delivering or providing hunter education, aquatic education, or other courses. This change clarifies that if an agency partners or contracts with another entity and the partner or vendor collects fees that do not go to the State agency, it is not program income. It also clarifies that the courses may be more than just hunter education, but any courses a State may offer under these programs. We expanded § 80.120(c)(3) not only to apply these incidental costs to all offered training, but also to explain that incidental costs are small amounts and typically not essential to training delivery. For example, if there is no fee for a course, but the agency sells each participant a workbook at cost for $5, that is incidental and not program income. If a class offers food and drink to attendees who are then asked to contribute to the cost, that is an incidental cost and not program income.

Comment 55: Clarify the change at § 80.123 to say that program income must be spent within the grant period and program in which it is earned before requesting additional Federal funds for the activity for which the program income is earned. Otherwise, it could be misinterpreted to mean that an agency may not request any Federal funds, even if from another project or program, unless that program income is expended first.

Response 55: We concur with this suggestion and make changes. We also make additional changes to this section to reflect some of the flexibility we announced earlier this year for increased use of the cost-sharing program income method. At § 80.123(a) we change the word “method” to “methods” to indicate that a State agency may indicate its intention to use more than one method for program income. We add the next sentence that includes the clarification for when program income must be spent and designate as § 80.123(b). We designate the table that describes the three methods for applying program income as § 80.123(c) and make changes to align with 2 CFR part 200 and other sections of 50 CFR part 80. We remove the existing § 80.123(c), which gives additional criteria for using the cost-sharing method for program income, which we no longer require. These changes align to 2 CFR part 200 and give State agencies greater latitude in using program income.

We received no comments on this section of the proposed regulations. However, we have changed the language from the proposed rule for clarification. We moved the requirement in the last sentence to the beginning of the section and associated it with an award and not “activities.” This revision clarifies that spending program income before requesting additional payments is specific to the award and not to “activities,” which could be confused to mean the same activities under other awards.

Comment 56: We received comments that reflect three concerns: (1) This section seems to contradict 2 CFR 200.59 regarding intangible property; (2) it is unclear how this relates to land database requirements; and (3) this question and answer read more like a definition.

Response 56: There are two separate concepts that are getting confused. The regulations at 2 CFR 200.59 state, “Intangible property means property having no physical existence, such as trademarks, copyrights, patents and patent applications and property, such as loans, notes and other debt instruments, lease agreements, stock and other instruments of property ownership (whether the property is tangible or intangible).” There is a difference between a lease agreement and the land associated with a lease. The lease agreement is intangible, but the land associated with the lease agreement is tangible. However, that is not the question here. The question here is whether a lease is real or personal property. The intangible lease agreement, along with the tangible property it relates to, are together treated as real property. This is supported by WSFR's Solicitor who wrote in an opinion that true leases are considered real property, unless a State Attorney General provides an official written decision indicating otherwise.

The second comment regarding the land database requirements is not a topic we intend to address in rulemaking. The commenter should discuss this issue with Regional WSFR staff. In regard to the comment that this question and answer reads more like a definition, Federal regulatory agencies should not include substantive regulatory provisions in a definition, but definitions may be included within the body of the rule, especially if they add clarity or are not used in more than one section of the rule. No comments objected to the answer to the question, but due to the confusion surrounding tangible vs. intangible property and real vs. personal property, we will not include this issue in the final rule and will address in future policy work, while concentrating on clarifying all aspects of the topic.

Comment 57: Why is the Service proposing a new section that instructs States what not to do, and why is it in the real property section? Also, please explain “substantial involvement.”

Response 57: The Service's Branch of Fire Management is responsible for developing and maintaining the policy that includes controlled burns. In September 2005 the Joint Federal/State Task Force on Federal Assistance Policy (JTF) discussed the topic of controlled burns conducted by States using WSFR funds and a proposed update to the policy. The Service's Solicitor's Office and WSFR Policy staff worked with the Branch of Fire Management on this topic. The States wanted clarity, as often acceptance of Federal funds means compliance with Federal requirements. The determination was that a State conducting such actions on non-Federal land without substantial involvement from a Federal entity does not have to follow the Service policy on controlled burns. This determination was documented in a Director's Memo, “Prescribed Burning Off-Service Lands: Clarification of the Sept. 16, 2005, Addendum to the Fish and Wildlife Service Fire Management Handbook” issued on March 29, 2007. The addendum states: “When conducting prescribed burning off Service lands under a Service-administered grant agreement, State fish and wildlife agencies: (a) Must comply with existing State protocols that include compliance with pertinent Federal, State, and local laws; and (b) do not have to comply with any requirements of the Fish and Wildlife Service Fire Management Handbook provided that the Service does not have “substantial involvement” in the project, as provided in 31 U.S.C. 6301-6308. Therefore, if these requirements are met, State grantees under a Service-administered grant agreement do not have to submit documentation under the grant agreement to reflect compliance with requirements of the Fish and Wildlife Service Fire Management Handbook.” The purpose of adding this section to the rule is to institutionalize this information in program regulations, a location directly applicable to these programs, as it would not be typical for grantees to refer to Service Manual chapters outside of WSFR.

Substantial involvement is what distinguishes a grant from a cooperative agreement per the Federal Grant and Cooperative Agreement Act of 1977 (Pub. L. 95-224, Feb. 3, 1978). Per OMB guidance (43 FR 36860, August 18, 1978), the basic statutory criterion for distinguishing between grants and cooperative agreements is that for the latter, substantial involvement is anticipated between the executive agency and the grantee during performance of the contemplated activity. The Code of Federal Regulations (CFR) further describes “substantial involvement” is a relative, rather than an absolute, concept, and that it is primarily based on programmatic factors, rather than requirements for grant or cooperative agreement award or administration. For example, substantial involvement may include collaboration, participation, or intervention in the program or activity to be performed under the award (32 CFR 22.215(b)). Grants.gov also addresses that, in general terms, “substantial involvement” refers to the degree to which Federal employees are directly performing or implementing parts of the award program. In a grant, the Federal Government more strictly maintains an oversight and monitoring role. In a cooperative agreement, Federal employees participate more closely in performing the program. When you read “cooperative,” think working “side-by-side.” ( https://blog.grants.gov/2016/07/19/what-is-a-cooperative-agreement/ ) This concept has been around for decades, and Federal grant managers are trained to make these decisions. Traditionally, most awards under this rule are made using the instrument of a grant, and not a cooperative agreement. Cooperative agreements are allowed, but rarely done, as the majority of projects are conducted under the control of the State fish and wildlife agency without Federal staff having an active role. This proposed new section was located in the real property section because it involves land activities.

However, due to the concerns raised by comments to this section, we will not include this new section in the final rule and will consider for future rulemaking.

Comment 58: Recommend changing the term “grant-funded” to “grant-acquired.”

Response 58: We agree and make the change.

Comment 59: Recommend removing any reference to personal property as it is confusing in a section focused on real property.

Response 59: We agree and make the change.

Comment 60: We received several comments on this section that address § 80.140(c) and clarifying any relationship between disposition and program income, confusion because real and personal property are addressed together in this section, questions on WSFR-funded vs. license revenue-funded assets, how this section relates to 2 CFR part 200 and State assent legislation, and specific questions related to various scenarios.

Response 60: We concur that disposition is a complicated topic and understand combining real and personal property, and all of the nuances of both the program and 2 CFR part 200, can lead to confusion as written. We will not make any changes to the final rule based on these proposed changes and will pursue this issue in future policy work.

We received no comments on this section; however, since the proposed rule was published, WSFR has a new OMB Control Number for information collections. We updated the final rule to reflect this change.

Executive Order 12866 provides that the Office of Information and

Regulatory Affairs (OIRA) will review all significant rules. OIRA has determined that this rule is not significant.

Executive Order 13563 reaffirms the principles of E.O. 12866 while calling for improvements in the nation's regulatory system to promote predictability, to reduce uncertainty, and to use the best, most innovative, and least burdensome tools for achieving regulatory ends. The executive order directs agencies to consider regulatory approaches that reduce burdens and maintain flexibility and freedom of choice for the public where these approaches are relevant, feasible, and consistent with regulatory objectives. E.O. 13563 emphasizes further that regulations must be based on the best available science and that the rulemaking process must allow for public participation and an open exchange of ideas. We have developed this final rule in a manner consistent with these requirements.

The Regulatory Flexibility Act requires an agency to consider the impact of rules on small entities, i.e., small businesses, small organizations, and small government jurisdictions. If there is a significant economic impact on a substantial number of small entities, the agency must perform a regulatory flexibility analysis. This analysis is not required if the head of an agency certifies the rule will not have a significant economic impact on a substantial number of small entities. The Small Business Regulatory Enforcement Fairness Act (SBREFA) amended the Regulatory Flexibility Act to require Federal agencies to state the factual basis for certifying that a rule will not have a significant economic impact on a substantial number of small entities. We have examined this final rule's potential effects on small entities as required by the Regulatory Flexibility Act. We have determined that this final rule does not have a significant impact and does not require a regulatory flexibility analysis because it:

a. Gives information to State fish and wildlife agencies that allows them to apply for and administer financial assistance more easily, more efficiently, and with greater flexibility. Only State fish and wildlife agencies may receive Wildlife Restoration, Sport Fish Restoration, and Hunter Education program and subprogram grants.

b. Addresses changes in law and regulation. This rule helps applicants and grantees by making the regulations consistent with current authorities and standards.

c. Rewords and reorganizes the regulations to make them easier to understand.

d. Allows small entities to voluntarily become subgrantees of agencies, and any impact on these subgrantees would be beneficial.

The Service has determined that the changes primarily affect State governments and any small entities affected by the changes voluntarily enter into mutually beneficial relationships with a State agency. They are primarily concessioners and subgrantees, and the impact on these small entities will be very limited and beneficial in all cases.

Consequently, we certify that because this final rule will not have a significant economic effect on a substantial number of small entities, a regulatory flexibility analysis is not required.

In addition, this final rule is not a major rule under SBREFA (5 U.S.C. 804(2)) and will not have a significant impact on a substantial number of small entities because it will not:

a. Have an annual effect on the economy of $100 million or more;

b. Cause a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions; or

c. Have significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of U.S.-based enterprises to compete with foreign-based enterprises.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1501 et seq. ) establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. The Act requires each Federal agency, to the extent permitted by law, to prepare a written assessment of the effects of regulations with Federal mandates that may result in the expenditure by State, local, and tribal governments, in aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any 1 year. We have determined the following under the Unfunded Mandates Reform Act:

a. As discussed in the determination for the Regulatory Flexibility Act, this final rule will not have a significant economic effect on a substantial number of small entities.

b. The regulation does not require a small government agency plan or impose any other requirement for expending local funds.

c. The programs governed by the final rule potentially assist small governments financially when they occasionally and voluntarily participate as subgrantees of an eligible agency.

d. The final rule clarifies and improves upon the current regulations allowing State, local, and tribal governments and the private sector to receive the benefits of financial assistance funding in a more flexible, efficient, and effective manner.

e. Any costs incurred by a State, local, or tribal government or the private sector are voluntary. There are no mandated costs associated with the final rule.

f. The benefits of grant funding outweigh the costs. The Federal Government may legally provide up to 100 percent funding for grants to Puerto Rico and the District of Columbia. The Federal Government will also waive the first $200,000 of match for each grant to the Commonwealth of the Northern Mariana Islands and the territories of Guam, the U.S. Virgin Islands, and American Samoa. Of the 50 States and 6 other jurisdictions that voluntarily are eligible to apply for grants in these programs each year, all participate. This is clear evidence that the benefits of this grant funding outweigh the costs.

g. This final rule will not produce a Federal mandate of $100 million or greater in any year, i.e., it is not a “significant regulatory action” under the Unfunded Mandates Reform Act.

This final rule will not have significant takings implications under E.O. 12630 because it will not have a provision for taking private property. Real property acquisitions under these programs is done with willing sellers only. Therefore, a takings implication assessment is not required.

This final rule will not have sufficient Federalism effects to warrant preparing a federalism summary impact statement under E.O. 13132. It would not interfere with the States' ability to manage themselves or their funds. We work closely with the States administering these programs. They helped us identify those sections of the current regulations needing further consideration and new issues that prompted us to develop a regulatory response.

The Office of the Solicitor has determined under E.O. 12988 that the rule will not unduly burden the judicial system and meets the requirements of sections 3(a) and 3(b)(2) of the Order. The final rule will help grantees because it:

a. Updates the regulations to reflect changes in policy and practice and recommendations received during the past 7 years;

b. Makes the regulations easier to use and understand by improving the organization and using plain language;

c. Modifies the final rule to amend 50 CFR part 80 published in the Federal Register at 76 FR 46150 on August 1, 2011, based on subsequent experience; and

d. Adopts recommendations on new issues received from State fish and wildlife agencies. We reviewed all comments on the proposed rule and considered all suggestions when preparing the final rule for publication.

This final rule does not contain new information collection requirements that require approval under the PRA (44 U.S.C. 3501 et seq. ). OMB reviewed and approved the U.S. Fish and Wildlife Service application and reporting requirements associated with the Wildlife Restoration, Sport Fish Restoration, and Hunter Education & Safety financial assistance programs and assigned OMB Control Number 1018-0100, which expires July 31, 2021. An agency may not conduct or sponsor and you are not required to respond to a collection of information unless it displays a currently valid OMB Control Number.

We have analyzed this final rule under the National Environmental Policy Act (42 U.S.C. 4321 et seq. ), 43 CFR part 46, and part 516 of the Departmental Manual. This rule is not a major Federal action significantly affecting the quality of the human environment. An environmental impact statement/assessment is not required due to the categorical exclusion for administrative changes given at 43 CFR 46.210(i).

We have evaluated potential effects on federally recognized Indian tribes under the President's memorandum of April 29, 1994, “Government-to-Government Relations with Native American Tribal Governments” (59 FR 22951), E.O. 13175, and 512 DM 2. We have determined that there are no potential effects. This final rule will not interfere with the tribes' ability to manage themselves or their funds.

E.O. 13211 addresses regulations that significantly affect energy supply, distribution, and use, and requires agencies to prepare Statements of Energy Effects when undertaking certain actions. This rule is not a significant regulatory action under E.O. 12866 and does not affect energy supplies, distribution, or use. Therefore, this action is not a significant energy action and no Statement of Energy Effects is required.

For the reasons discussed in the preamble, we amend title 50 of the Code of Federal Regulations, chapter I, subchapter F, part 80, as follows:

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

The 2019 total allowable catch (TAC) of Pacific cod allocated to catcher/processors using trawl gear in the Central Regulatory Area of the GOA is 239 metric tons (mt) as established by the final 2019 and 2020 harvest specifications for groundfish of the GOA (84 FR 9416, March 14, 2019).

In accordance with § 679.20(d)(2), the Administrator, Alaska Region, NMFS (Regional Administrator), has determined that the 2019 TAC of Pacific cod allocated to catcher/processors using trawl gear in the Central Regulatory Area of the GOA has been reached. Therefore, NMFS is requiring that Pacific cod caught by catcher/processors using trawl gear in the Central Regulatory Area of the GOA be treated as prohibited species in accordance with § 679.21(a)(2).

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 prohibiting the retention of Pacific cod by catcher/processors using trawl gear in the Central Regulatory Area of the GOA. NMFS was unable to publish a notice providing time for public comment because the most recent, relevant data only became available as of August 21, 2019.

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 679.21 and is exempt from review under Executive Order 12866.