I. Comments

FHFA invites comment on all aspects of the proposed amendments and will take all comments into consideration before adopting amendments through a final rule. Copies of all comments received will be posted without change on the FHFA website at http://www.fhfa.gov, and will include any personal information you provide, such as your name, address, email address, and telephone number. In addition, copies of all comments received will be available for examination by the public through the electronic rulemaking docket for this proposed rule also located on the FHFA website.

Section 401 of the EGRRCPA, (Pub. L. 115-174, section 401) amended the Dodd-Frank Act requirements to implement stress testing. Prior to the passage of the EGRRCPA,1 section 165(i) of the Dodd-Frank Act 2 required each financial company with total consolidated assets of more than $10 billion to conduct annual stress tests. In addition, section 165 required FHFA to issue regulations for regulated entities to conduct their stress tests, which were required to include at least three different stress testing scenarios: “baseline,” “adverse,” and “severely adverse.” 3 In September 2013, FHFA published in the Federal Register a final rule implementing the Dodd-Frank Act stress testing requirements. FHFA's regulation, located at 12 CFR part 1238, requires each regulated entity to conduct an annual stress test based on scenarios provided by FHFA and consistent with FHFA prescribed methodologies and practices. The regulation also requires that the agency issue to the regulated entities stress test scenarios that are generally consistent with and comparable to those developed by the FRB not later than 30 days after the FRB publishes its scenarios.4

Section 401 of EGRRCPA amended certain aspects of the stress testing requirements applicable to financial companies in section 165(i) of the Dodd-Frank Act.5 Specifically, after 18 months, section 401 of EGRRCPA raises the minimum asset threshold for application of the stress testing requirement from $10 billion to $250 billion in total consolidated assets, revises the requirement for financial companies to conduct stress tests “annually,” and instead requires them to conduct stress tests “periodically”, and no longer requires the stress test to include an “adverse” scenario, thus reducing the number of required stress test scenarios from three to two.

The purpose of this proposed rule is to revise FHFA's stress testing rules applicable to its regulated entities, consistent with amendments made by section 401 of EGRRCPA. The proposed rule would also make additional technical changes to the stress testing rule. In sum, the proposed rule would discontinue the Dodd-Frank Act stress testing of the Banks and reduce the number of scenarios mandated for Enterprise Dodd-Frank Act stress testing.

As described above, section 401 of EGRRCPA amended section 165 of the Dodd-Frank Act by raising the minimum threshold for financial companies required to conduct stress tests from $10 billion to $250 billion. As there are no Banks with total consolidated assets of over $250 billion, the Banks will no longer be subject to the stress testing requirements of this rule. Though each of the Banks has total consolidated assets of less than $250 billion, the rule expressly maintains the Director's discretion to require any regulated entity with assets below the $250 billion threshold to conduct the stress test. As the total consolidated assets for each Enterprise exceed the $250 billion threshold, the Enterprises remain subject to stress testing under this rule.

Section 401 of EGRRCPA also revised the requirement under section 165 of the Dodd-Frank Act for financial companies to conduct stress tests, changing the required frequency from “annual” to “periodic.” The term “periodic” is not defined in EGRRCPA. Because of the Enterprises' total consolidated asset amounts, their function in the mortgage market, size of their retained portfolios, and their share of the mortgage securitization market, FHFA proposes to require the Enterprises to conduct stress tests on an annual basis. This is consistent with FHFA's regulatory mission to ensure each of the regulated entities “operates in a safe and sound manner.” 6

As discussed above, section 401 of EGRRCPA amended section 165(i) of the Dodd-Frank Act to no longer require the Board to include an “adverse” stress-testing scenario, reducing the number of stress test scenarios from three to two. The “baseline” scenario is a set of conditions that affect the U.S. economy or the financial condition of the regulated entities, and that reflect the consensus views of the economic and financial outlook, and the “severely adverse” scenario is a more severe set of conditions and the most stringent of the former three scenarios. Although the “adverse” scenario has provided some additional value in limited circumstances, the “baseline” and “severely adverse” scenarios largely cover the full range of expected and stressful conditions. Therefore FHFA does not consider it necessary, for its supervisory purposes, to require the additional burden of analyzing an “adverse” scenario.

In accordance with section 165(i)(2)(C), FHFA has coordinated with both the FRB and the Federal Insurance Office (FIO). On November 29, 2018, the FRB published a proposed rule which revised “the minimum threshold for state member banks to conduct stress tests from $10 billion to $250 billion,” and revised “the frequency with which state member banks with assets greater than $250 billion would be required to conduct stress tests,” in addition to removing the adverse scenario from the list of required scenarios.7 The FDIC adopted its final rule; 8 and the OCC its final rule.9 Although FHFA's amended proposed rule would not be identical to those of the FRB, the FDIC, and the OCC, it is consistent and comparable with them. FHFA consulted with the FRB and FIO before proposing these amendments.

The proposed rule does not contain any collections of information pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501, et seq.). Therefore, FHFA has not submitted any information to the Office of Management and Budget for review.

The proposed rule applies only to the regulated entities, which do not come within the meaning of small entities as defined in the Regulatory Flexibility Act (see 5 U.S.C. 601(6)). Therefore, in accordance with section 605(b) of the Regulatory Flexibility Act (5 U.S.C. 605(b)), the General Counsel of FHFA certifies that this proposed rule, if promulgated as a final rule, will not have a significant economic impact on a substantial number of small entities.

For the reasons stated in the SUPPLEMENTARY INFORMATION section, and under the authority of 12 U.S.C. 5365(i), FHFA proposes to amend part 1238 of Title 12 of the Code of Federal Regulations to read as follows:

The policy objective of the proposed rule is to clarify the FDIC's application of section 19 of the FDI Act (section 19), clarify the application process for insured depository institutions and individuals who seek relief from the provisions of section 19, and seek public comment on additional proposals that could expand the scope of relief available for minor offenses. The FDIC has issued a Statement of Policy for Section 19 of the Federal Deposit Insurance Act (SOP), which provides the public with guidance relating to section 19 and the FDIC's application thereof. The current version of the SOP, with some modifications over time, has been a published resource for the public for over twenty years; however, some uncertainty may exist because the terms and procedures outlined in the SOP have not been adopted as regulations by the FDIC. To remove potential ambiguities about the FDIC's application of section 19 or the application process, the proposed rule will incorporate the current content of the SOP into its rules and procedures, thereby further clarifying its existing practices enforcing section 19. Additionally, the FDIC seeks comment from members of the public, including but not limited to, insured depository institutions, other financial institutions and companies, individual depositors and consumers, employees and prospective employees of insured depository institutions or other financial services institutions that have applied for or been granted relief from the provisions of section 19, and civil rights organizations, consumer groups, trade associations, and other members of the financial services industry regarding the scope of section 19, possible amendments to the relief process, the scope of the de minimis offense exemption, and the treatment of expunged criminal records.

The FDIC seeks to incorporate its SOP, which is issued pursuant to section 19 of the Federal Deposit Insurance Act,1 into its existing Procedures and Rules of Practice. Section 19 prohibits, without the prior written consent of the FDIC, any person from participating in banking who has been convicted of a crime of dishonesty or breach of trust or money laundering, or who has entered a pretrial diversion or similar program in connection with the prosecution for such an offense. Further, the law forbids an insured institution from permitting such a person to engage in any conduct or to continue any relationship prohibited by section 19. It also imposes a ten-year ban against the FDIC's consent for a person convicted of certain crimes enumerated in Title 18 of the United States Code, absent a motion by the FDIC and approval by the sentencing court.

The FDIC issued originally, after notice and comment, the current SOP in December 1998 2 to provide the public with guidance relating to section 19 and the FDIC's application thereof. The 1998 SOP, among other things, instituted a set of criteria to provide for blanket approval of certain low-risk crimes, and for persons convicted of such de minimis crimes to forgo filing an application.

A clarification to the SOP was issued in 2007, based on the 2006 amendment to Section 19 of the FDI Act by section 710 of the Financial Services Regulatory Relief Act of 2006,3 which modified section 19 to include coverage of institution-affiliated parties (IAPs) participating in the affairs of bank holding companies, or savings and loan holding companies, and gave supervisory authority over such entities to the Board of Governors of the Federal Reserve System (Federal Reserve Board) and the Office of Thrift Supervision (OTS), respectively.4 The FDIC, in 2011, further clarified the SOP as to: (i) The applicability of section 19 to IAPs of bank and savings and loan holding companies; (ii) the meaning of the term “complete expungement;” and (iii) the factors for considering which convictions are considered de minimis.5 In December of 2012, the FDIC modified the de minimis exception to filing by changing the amount of the maximum potential fine to qualify for de minimis treatment from $1,000 to $2,500. The modification also changed the limit on the amount of jail time needed to qualify for the de minimis exception from no jail time served to a maximum number of three days spent in jail.6

The current version of the SOP was last revised by the Board of Directors in August of 2018,7 after notice and comment. The 2018 revisions made a number of substantive changes in addition to some grammatical and format changes. The FDIC provided that institutions it supervised could make conditional offers of employment to individuals provided they were not hired until the institution had determined that they were not barred by section 19. The FDIC clarified when section 19 applied to certain persons who are not employees, officers, directors or shareholders of an insured depository institution. The FDIC also deleted language referencing the change that expanded section 19's application to bank and savings and loan holding companies and simply noted that if a person also seeks to participate in the affairs of a bank or savings and loan holding company, they may be required to comply with any requirements of the Federal Reserve Board under 12 U.S.C. 1829(d) and (e).

In regard to considering applications, the FDIC included language addressing when an application will be considered by the FDIC, which states that the FDIC will not consider an application unless all of the sentencing requirements associated with the conviction, or the conditions imposed by a pretrial diversion or similar program, are completed, and the court's decision must be considered final under the procedures of the applicable jurisdiction.

The FDIC also added additional language to address questions regarding complete expungements and made clear that, if the expungement is intended to be complete under the law of the jurisdiction that issues the expungement, and the jurisdiction intends that no governmental body or court can use the prior conviction or program entry for any subsequent purpose, then the fact that the records have not been timely destroyed, or that there exist copies of the records that are not covered by the order sealing or destroying them, will not prevent the expungement from being considered complete for the purposes of section 19.

The FDIC also added language that treats certain convictions that have been set aside or reversed after the sentencing requirements have been completed in the same manner as pretrial diversion or similar programs are treated, unless the reason that the conviction was set aside or reversed is based on a finding on the merits that the conviction was wrongful. In addressing pretrial diversions or similar programs, the FDIC clarified how such programs would be identified by stating that whether a program constitutes a pretrial diversion or similar program is determined by relevant Federal, state or local law, and if that program is not so designated under applicable law, then the determination will be made by the FDIC on a case-by-case basis.

The FDIC also expanded the application of provisions for de minimis offenses where an application would not be required and it would be deemed approved. The general provisions for the application of de minimis were changed in two ways. The definition of jail time was clarified and the previous de minimis category for bad or insufficient fund checks was expanded and set out as a separate basis for applying the de minimis exception to filing. The FDIC created new exceptions to the filing requirement. First, a person with a covered conviction or program entry where the acts leading to the conviction or program entry occurred when the person was 21 or younger who also meets the general de minimis exception to filing and who has completed all sentencing or program requirements, will qualify for this de minimis exception to filing if at least 30 months have passed prior to the date an application would otherwise be required. Second, an exception to filing would apply when the conviction or program entry is based on a small dollar theft of goods, services, and/or currency (or other monetary instrument) and the aggregate value of the goods, services and/or currency was $500 or less at the time of the conviction or program entry. Additionally, the individual must have only one conviction or program entry under section 19, and five years must have passed since the conviction or program entry.

The provision related to bad or insufficient funds checks was also expanded to apply to all such convictions or program entries provided that there was no other program entry for an offense covered by section 19, the total amount of the checks did not exceed $1,000 and that no insured depository institution or credit union was a payee on any of the bad or insufficient funds checks. Lastly, the use of a fake or altered identification to purchase alcohol or to enter a premises where age appropriate identification was required would not require an application provided there was no other conviction or program entry for an offense covered by section 19.

The FDIC also clarified that no conviction for a violation of certain Title 18 provisions, as set out in 12 U.S.C. 1829(a)(2), can qualify under any of the de minimis exceptions to filing that are set out in the SOP and that drug convictions or program entries which currently require an application can fall within the de minimis exceptions to filing that are set out in the SOP.

The FDIC provided additional information directing individual applicants to file their application with the FDIC Regional Office covering the state where the person lives and also adjusted the language in the evaluations section of the SOP to more closely mirror the language in 12 CFR 308.157 as well as stated that, under the provision that allows the FDIC to consider other appropriate factors, the FDIC may contact the primary Federal and/or state regulator to aid in the evaluation of an application.

Lastly, the FDIC added clarifying language related to bank-sponsored applications that makes clear that changes in an individual's duties at the insured institution which filed a previously approved section 19 application on that individual's behalf will require a new application. There is also a clarification that a new application will be required if an individual, covered by a previously approved bank-sponsored application, desires to participate in the affairs of another insured depository institution.

The FDIC has determined that the current provisions of the SOP should be incorporated into its rules and procedures in order to provide for greater transparency as to its application, provide greater certainty as to the FDIC's application process and to aid both insured depository institutions and individuals who may be affected by section 19 of the FDI Act to understand its impact and potentially seek relief from its provisions. The FDIC will also rescind those sections of 12 CFR 308, subpart M, which would be duplicative of the changes needed to Part 303, subpart L, and will revise the remaining sections to insure conformity for any request for a hearing when an application under section 19 has been denied.

Currently, 12 CFR part 303, subpart L provides only very basic information as to the need to file an application with the FDIC in order to obtain the written permission of the FDIC required by section 19 so that the person may be employed by, or own or control, or participate in the affairs of an insured depository institution. Further, while some additional details about the filing process were set out in 12 CFR part 308, subpart M, the information was still not as complete as it could have been, and some parts of Part 308, subpart M were actually duplicative of what was in Part 303, subpart L. The better approach would be to describe the complete application process in Part 303, subpart L and amend Part 308, subpart M to address the procedures and rules that could be followed if an application is denied and a hearing is sought.

Therefore, consistent with the foregoing, the FDIC is proposing to rescind subpart L of 12 CFR part 303, and replace and rename it with a new subpart and to revise and amend, as well as rename, subpart M of Part 308. While much of the SOP has been incorporated into the proposed revised subpart L of part 303, some adjustments to the language have been made to add clarification, correct grammar and style consistent with a regulation and, occasionally, reformatted to fit the regulatory scheme.

1. § 303.220 What is section 19 of the FDI Act?

This section combines portions of the scope section in the existing 12 CFR 303.220 and the introduction part of the SOP. Paragraph (a) is the scope provisions from the existing § 303.220. Paragraph (b) sets out the application of section 19 to insured depository institutions including the conditional offers of employment that FDIC supervised institutions may make as is in the existing SOP. Paragraph (c) comes from the SOP and addresses the need for an application.

2. § 303.221 Who is covered by section 19?

This section identifies who is covered by section 19 and comes mainly from the existing SOP. Paragraph (a) defines institution affiliated parties and others who may fall within the scope of section 19. Paragraph (b) defines the term “person” for the purposes of section 19 as an individual not a legal entity. Paragraph (c) addresses when a person is covered under 12 U.S.C. 1829(a) and must file an application with the FDIC even if the person is also covered under 12 U.S.C. 1829(d) and (e), which would require an application approved by the Board of Governors of the Federal Reserve System for an individual at the bank or saving and loan holding company. Paragraph (d) defines when “ownership” or “control” results in the application of section 19 to an individual or individuals who may be deemed in control of, or be deemed to be an owner of, an insured depository institution.

3. § 303.222 What offenses are covered under section 19?

This section comes mainly from the SOP and addresses what is a criminal offense under section 19. Paragraph (a) defines when a criminal offense constitutes a crime of dishonesty or breach of trust. Paragraph (b) requires that, to determine if the criminal offense is one of dishonesty, breach of trust, or money laundering, the FDIC will look to the statutory elements of the criminal offense or to court decisions in the relevant jurisdiction that have found the criminal offense to be one of dishonesty, breach of trust or money laundering. Paragraph (c) requires an application for all drug offenses, except for simple possession, unless the criminal offense meets the criteria in § 303.227 for not filing an application.

4. § 303.223 What constitutes a conviction under section 19?

This section comes mainly from the SOP. Paragraph (a) addresses that there must have been a conviction and that section 19 does not apply to arrests, pending cases not brought to trial, or any conviction reversed on appeal unless the person has entered a pretrial diversion or similar program as set out in § 303.224. Paragraph (b) addresses what constitutes a complete expungement for the purposes of section 19. Paragraph (c) excludes youthful offender adjudgments for minors from the scope of section 19.

5. § 303.224 What constitutes a pretrial diversion or similar program (a program entry) under section 19?

This section comes mainly from the SOP. Paragraph (a) defines what constitutes a pretrial diversion or similar program and excludes program entries that occurred prior to November 29, 1990. Paragraph (b) states that expungements of program entry records will be treated the same as expungements of convictions.

6. § 303.225 What are the types of applications that can be filed?

This section is a combination of the existing § 303.221, § 308.158 and the SOP. Paragraph (a) establishes the institution filing requirement. Paragraph (b) establishes the procedure to apply when an insured depository institution will not file an application for an individual.

7. § 303.226 When is an application to be filed?

This section comes mainly from the SOP. This section states when an application is to be filed excepting from its requirement those covered offenses which are considered de minimis under subpart L. An application will not be considered by the FDIC until all sentencing requirements associated with a conviction have been met or all requirements of the program entry have been completed.

8. § 303.227 When is an application not required for a covered conviction or program entry?

This section comes mainly from the SOP. Paragraph (a) establishes the general criteria for de minimis convictions or program entries for which, if the criteria are met, the person is deemed automatically approved and no application will be required. Paragraph (b) establishes certain other specific exceptions to the filing requirement which if met will be deemed automatically approved. Paragraph (b)(1) shortens the five- year waiting period under the general criteria to 30 months when all the elements of the offense occurred before the person is age 21 or younger and the person meets the criteria established by that exception to filing. Paragraph (b)(2) establishes the criteria, which if met, provides that certain convictions or program entries for bad or insufficient funds checks will not require an application. Paragraph (b)(3) establishes the criteria, which if met, provides that certain small dollar simple theft convictions or program entries of $500 or less will not require an application. Excluded from this exception to filing are convictions or program entries for burglary, forgery, identity theft, and fraud. Paragraph (b)(5) establishes the criteria which, if met, provides that the use of a fake or false identification by a person under the legal age to purchase alcohol or used to enter premises where alcohol is served but where age appropriate identification is required to enter the premises will not require an application. Paragraph (c) requires that, for any case where the person is able to avail themselves of the de minimis exception to filing, they must disclose the convictions or program entries to the insured depository institution and must qualify for a fidelity bond to the same extent as others in a similar position. Paragraph (d) states that any conviction or program entry for criminal offenses under Title 18 set out in 12 U.S.C. 1829(a)(2) cannot qualify for de minimis exception to filing an application.

9. § 303.228 How to file an application.

This section comes from the SOP. This section provides the requirement that an insured depository institution is to file an application on behalf of an individual under section 19 to participate in its affairs unless the FDIC grants the individual a waiver for good cause shown to file on their own behalf. Insured depository institutions should file with the FDIC's Regional Office where the institution's home office is located and any waiver and application on behalf of an individual should be filed with the FDIC's Regional Office where the person lives.

10. § 303.229 How an application is evaluated.

This section comes from a combination of § 308.157 and the SOP. Paragraph (a) sets out the ultimate determination the FDIC will make as to the level of risk the applicant poses to an insured depository institution and whether it will consent to allow the person to participate in an insured depository institution's affairs. In evaluating the risk posed by the person's participation the FDIC has established nine factors that it will look at, including other factors that might be relevant to a particular application. Paragraph (b) states that the question of whether a person was guilty of the offense for which the person was convicted, or had a program entry for, is not an issue for Part 303, subpart L or for part 308, subpart M. Paragraph (c) states that it will apply the factors and determination used in paragraph (a) when evaluating an application which is made to terminate the ten-year ban in 12 U.S.C. 1829(a)(2). Paragraph (d) provides that the person must be bonded the same as others in that position and the person must disclose the covered conviction or program entry to any insured depository institution in which they intend to participate. Paragraph (e) provides that for bank-sponsored applications the approval is to work a specific job at a specific bank and that the bank may be required to seek permission from the FDIC before there is a significant change in a person's duties and/or responsibilities and the Regional Director may request a new application. Approval to work at a specific insured depository institution is limited to that institution and a new application is required to work at another insured depository institution.

11. § 303.230 What will the FDIC do if the application is denied?

This section is a combination of the current §§ 303.223, 308.157 and 308.159. Paragraph (a) provides that the FDIC will provide a written denial which will summarize or cite the relevant factors from the proposed § 303.229. Paragraph (b) provides that the applicant can file a written request for a hearing pursuant to Part 308, subpart M within 60 days of the denial.

12. § 303.231 Waiting time for a subsequent application if an application is denied.

This section comes mainly from § 308.158 and was clarified so that an applicant will need to wait one year from the date of the denial or decision of the FDIC Board, or its designee.

1. § 308.156 Scope.

This section has been revised to reflect its application to denials that are issued pursuant to 12 CFR part 303, subpart L

2. § 308.157 Relevant considerations.

This section will be rescinded.

3. § 308.158 Filing Papers and effective date.

This section will be rescinded.

4. § 308.159 Denial of Application.

This section has been revised to reflect the outcome of the application process in Part 303, subpart L and to clarify the procedure by which a hearing may be requested. It will be renumbered as § 308.157.

5. § 308.160 Hearings.

This section will remain as it currently exists but will be renumbered as § 308.158.

After renumbering, §§ 308.159 and 309.160 will be reserved.

The FDIC expects the proposed rule to have relatively small effects on the public and insured institutions. The FDIC currently insures 5,312 depository institutions which could be affected by the proposed rule.8 Additionally, as discussed previously, the proposed rule would apply to certain persons covered by the provisions of section 19 who are or wish to become employees, officers, directors or shareholders of an insured depository institution. In the period from 2014 through 2018, the FDIC received 21 bank-sponsored section 19 applications, an average of four per year. Additionally, the FDIC received 500 individual section 19 applications during the same period, an average 100 per year.9 Therefore, the FDIC estimates that the proposed rule would affect at least four FDIC-insured depository institutions, and 100 individuals per year.

As described previously, the proposed rule incorporates the current content of the SOP into the FDIC's regulations; therefore, it poses no substantive changes for potential applicants, either insured institutions or individuals. Additionally, although codifying the current content of the SOP into the FDIC's regulations could change enforcement of that content, in practice it is unlikely to pose any substantive effect on covered entities and individuals. The FDIC considers individuals who have been convicted of a crime of dishonesty, breach of trust, or money laundering, who participate in the affairs of an insured depository institution without the prior written consent of the FDIC, to be violations of section 19, and will continue to do so if the proposed rule is adopted in its current form. Therefore, the proposed rule is unlikely to pose any substantive change in the FDIC's enforcement of section 19. As such, removing the existing regulation 12 CFR part 303, subpart L and establishing a new subpart L, which incorporates the FDIC's existing SOP, as well as renaming, removing, and amending certain provisions of 12 CFR part 308, subpart M is unlikely to have any substantive effects on the current section 19 application process or the FDIC's enforcement of section 19.

To the extent that the current content of the FDIC's SOP conveys any ambiguity as to the FDIC's application of section 19 or the application process, the proposed rule would benefit covered entities and individuals by further clarifying this topic and process. However, the FDIC believes any such effects are likely to be relatively small because the FDIC has received bank-sponsored section 19 applications from less than 0.08 percent of FDIC-insured institutions, per year, on average,10 or section 19 applications from individuals who represent less than 0.004 percent of people employed in the credit intermediation sector of the U.S. economy.11

The FDIC invites comments on all aspects of this analysis. In particular, would the proposed rule have any costs or benefits that the FDIC has not identified?

The FDIC considered one alternative to the proposed rule but believes that the proposed amendments represent the most appropriate option for covered entities and individuals. The FDIC considered the status quo alternative of retaining the existing section 19 SOP and regulations.12 However, the FDIC believes that the proposed rule further clarifies the FDIC's application of section 19 of the FDI Act and the application process for insured depository institutions and individuals who seek relief from its provisions, while posing no substantive costs, relative to the status quo alternative.

The FDIC invites comments on its consideration of alternatives. In particular, are there other alternatives that the FDIC should consider?

(1) The FDIC seeks comment on all aspects of its approach to section 19 and more specifically in the questions that follow.

(2) The FDIC has received previous inquiries and comments from the public regarding section 19's scope that catches a number of minor offenses in perpetuity. In response to these concerns, the FDIC has established de minimis criteria, which have been expanded in 2007, 2011, 2012, and 2018. The FDIC continues to process low-risk cases that, in our experience, present a high likelihood of approval. For this reason, the FDIC seeks comments regarding the de minimis criteria for offenses that represent low-risk to the Deposit Insurance Fund while maintaining a balanced approach of reducing regulatory burden to the industry and individuals while maintaining the integrity of section 19.

(3) One of the specific de minimis categories involves the use of a fake identification for a person under the age of 21 in an attempt to purchase alcohol. The FDIC seeks comments on whether the de minimis criteria should be expanded and what if any additional situations involving low risk convictions should be covered by this category.

(4) The FDIC seeks comment on whether the five-year post-conviction cooling off period should be modified for certain offenses, and whether additional timeframes should be considered for various offenses.

(5) The FDIC has received previous inquiries and comments from the public related to expungements of convictions. Expungements have been a source of confusion for the industry and individual applicants. The FDIC has attempted to address these concerns by clarifying the term “complete expungement” for section 19 purposes and has made changes to the SOP in 2011 and 2018. However, despite these changes, expungements continue to be a source of confusion. For this reason, the FDIC seeks comments regarding the applicability of section 19 to expungements.

Written comments must be received by the FDIC no later than February 14, 2020.

In accordance with the requirements of the Paperwork Reduction Act (“PRA”), 13 the FDIC may not conduct or sponsor, and the respondent is not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (“OMB”) control number. The proposed rule will not create any new or revise any existing information collections pursuant to the PRA. Therefore, no information collection request will be submitted to the OMB for review.

The Regulatory Flexibility Act (“RFA”) generally requires an agency, in connection with a proposed rule, to prepare and make available for public comment an initial regulatory flexibility analysis that describes the impact of a rule on small entities.14 However, a regulatory flexibility analysis is not required if the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. The Small Business Administration (“SBA”) has defined “small entities” to include banking organizations with total assets of less than or equal to $600 million that are independently owned and operated or owned by a holding company with less than or equal to $600 million in total assets.15 Generally, the FDIC considers a significant effect to be a quantified effect in excess of 5 percent of total annual salaries and benefits per institution, or 2.5 percent of total noninterest expenses. The FDIC believes that effects in excess of these thresholds typically represent significant effects for FDIC-supervised institutions. As discussed further below, the FDIC certifies that, if adopted, this proposed rule will not have a significant economic impact on a substantial number of FDIC-supervised small entities.

The FDIC insures 5,312 depository institutions, of which 3,947 are defined as small banking organizations according to the RFA.16 In the period from 2014 through 2018, the FDIC received 15 bank-sponsored section 19 applications from small, FDIC-insured institutions, an average of three per year. Additionally, the FDIC received 500 section 19 applications from individuals during the same period, an average 100 per year.17 To determine the maximum number of small, FDIC-supervised institutions who could be affected by the proposed rule this analysis assumes that each applicant is seeking employment at a different bank, and that each bank is a small, FDIC-insured institution. Based on these assumptions it follows that annual section 19 applications can affect at most 103 (2.6 percent) small, FDIC-insured institutions on average, annually. 18 However, in the FDIC's experience, section 19 applications from individuals are compelled by the applicant's intent to seek employment at FDIC-insured institutions that are generally not small. Therefore, the FDIC believes that the number of small, FDIC-insured institutions affected by the proposed rule is likely to be smaller than 103. The FDIC estimates that the proposed rule would affect at least three, but no more than 103 small, FDIC-insured institutions, per year.

As described previously, the proposed rule incorporates the current content of the SOP into the FDIC's regulations; therefore, it poses no substantive changes for potential applicants. Additionally, although codifying the current content of the SOP into the FDIC's regulations could change enforcement of that content, in practice it is unlikely to pose any substantive effect on covered entities and individuals. The FDIC considers individuals who have been convicted of a crime of dishonesty, breach of trust, or money laundering, who participate in the affairs of an insured depository institution without the prior written consent of the FDIC, to be violations of section 19, and will continue to do so if the proposed rule is adopted in its current form. Therefore, the proposed rule is unlikely to pose any substantive change in the FDIC's enforcement of section 19. As such, removing the existing regulation at 12 CFR part 303, subpart L and establishing a new subpart L which incorporates the FDIC's existing SOP, as well as renaming, removing, and amending certain provisions of 12 CFR part 308, subpart M is unlikely to have any substantive effects on the current section 19 application process or the FDIC's enforcement of section 19 for small, FDIC-insured institutions.

To the extent that the current content of the SOP conveys any ambiguity as to the FDIC's application of section 19 or the application process, the proposed rule would benefit covered entities by further clarifying this topic and process. However, the FDIC believes any such effects are likely to be relatively small because section 19 applications received by the FDIC represent at most 2.6 percent of small, FDIC-insured institutions, per year, on average.

Based on the information above, the FDIC certifies that the proposed rule would not have a significant economic impact on a substantial number of small entities.

The FDIC invites comments on all aspects of the supporting information provided in this section, and in particular, whether the proposed rule would have any significant effects on small entities that the FDIC has not identified.

Section 722 of the Gramm-Leach-Bliley Act 19 requires each Federal banking agency to use plain language in all of its proposed and final rules published after January 1, 2000. As a Federal banking agency subject to the provisions of this section, the FDIC has sought to present the proposed rule in a simple and straightforward manner. The FDIC invites comments on whether the proposal is clearly stated and effectively organized, and how the FDIC might make the proposal easier to understand. For example:

• Has the FDIC organized the material to suit your needs? If not, how could it present the rule more clearly?

• Have we clearly stated the requirements of the rule? If not, how could the rule be more clearly stated?

• Does the rule contain technical jargon that is not clear? If so, which language requires clarification?

• Would a different format (grouping and order of sections, use of headings, paragraphing) make the regulation easier to understand? If so, what changes would make the regulation easier to understand?

• What else could we do to make the regulation easier to understand?

The Riegle Community Development and Regulatory Improvement Act of 1994 (“RCDRIA”) requires that each Federal banking agency, in determining the effective date and administrative compliance requirements for new regulations that impose additional reporting, disclosure, or other requirements on insured depository institutions, consider, consistent with principles of safety and soundness and the public interest, any administrative burdens that such regulations would place on depository institutions, including small depository institutions, and customers of depository institutions, as well as the benefits of such regulations. In addition, new regulations and amendments to regulations that impose additional reporting, disclosure, or other new requirements on insured depository institutions generally must take effect on the first day of a calendar quarter that begins on or after the date on which the regulations are published in final form.20 The FDIC invites comments that further will inform its consideration of RCDRIA.

For the reasons stated in the preamble and under the authority of 12 U.S.C. 1819 (Seventh and Tenth), the Federal Deposit Insurance Corporation proposes to amend parts 303 and 308 of title 12 of the Code of Federal Regulations as follows:

The FAA invites you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2019-1024; Product Identifier 2019-CE-002-AD” at the beginning of your comments. The FAA specifically invites comments on the overall regulatory, economic, environmental, and energy aspects of this NPRM. The FAA will consider all comments received by the closing date and may amend this NPRM because of those comments.

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

The FAA received a report from Gulfstream that the PFCAS LVDT mechanical disconnect monitor may not trigger the disconnect of the affected control surfaces as required in the event of a control surface failure. The Model GVI flight control computer actuator LVDT disconnect monitor should disable the control surface for ailerons, elevators, and rudder in the event that one of those control surfaces fails. Gulfstream developed an REU software update that provides improvements to the LVDT of the PFCAS, which addresses the LVDT disconnect monitor problem. This condition, if not addressed, could lead to spoiler hard-over or loss of structural integrity due to excessive surface deflection and result in loss of control of the airplane.

The FAA reviewed Gulfstream G650 Customer Bulletin Number 201, dated September 28, 2017, and Gulfstream G650ER Customer Bulletin Number 201, dated September 28, 2017; which specify incorporating Gulfstream G650 Aircraft Service Change 069, dated September 28, 2017, or Gulfstream G650ER Aircraft Service Change 069, dated September 28, 2017. This service information differs because each document applies to a different airplane designation.

The FAA also reviewed Gulfstream G650 Aircraft Service Change 069, dated September 28, 2017, and Gulfstream G650ER Aircraft Service Change 069, dated September 28, 2017, which provide and reference procedures for preparing the REU for a software update.

The FAA reviewed Parker Service Bulletin 469000-27-003, Revision 1, dated October 11, 2017, which contains procedures for updating the software of the REU from Label 34 to Label 35. This update includes improved LVDT disconnect and oscillatory monitoring, force fight mitigation, troubleshooting, and rectification of other reported problems.

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

This proposed AD would require accomplishing the actions specified in the service information described previously.

The FAA estimates that this proposed AD would affect 161 airplanes of U.S. registry.

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

According to the manufacturer, some of the costs of this proposed AD may be covered under warranty, thereby reducing the cost impact on affected individuals. The FAA does not control warranty coverage for affected individuals. As a result, the FAA has included all costs in this cost estimate.

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

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 proposed 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 small airplanes, gliders, balloons, airships, domestic business jet transport airplanes, and associated appliances to the Director of the Policy and Innovation Division.

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

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

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

(2) 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 proposes to amend 14 CFR part 39 as follows:

The FAA invites you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2019-0982; Product Identifier 2019-NM-170-AD” at the beginning of your comments. The FAA specifically invites comments on the overall regulatory, economic, environmental, and energy aspects of this NPRM. The FAA will consider all comments received by the closing date and may amend this NPRM based on those comments.

The FAA will post all comments, without change, to https://www.regulations.gov, including any personal information you provide. The FAA will also post a report summarizing each substantive verbal contact the agency receives about this NPRM.

The EASA, which is the Technical Agent for the Member States of the European Union, has issued EASA AD 2019-0233, dated September 18, 2019; corrected September 19, 2019 (“EASA AD 2019-0233”) (also referred to as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for certain Airbus SAS Model A319-115 airplanes; Model A320-214, -216, -232, -251N, and -271N airplanes; and Model A321-211, -231, -251N, -251NX, -253N, -271N, -271NX, and -272N airplanes.

This proposed AD was prompted by reports of incomplete installations of the over wing panel lug attachments in the production assembly line. The FAA is proposing this AD to address this condition, which, if not detected and corrected, could reduce the structural integrity of the wing. See the MCAI for additional background information.

EASA AD 2019-0233 describes procedures for a one-time detailed inspection of certain attaching points on the left-hand and right-hand wings for the correct installation of certain hardware (bolt, nut, washer, and cotter pin), and, depending on findings, accomplishment of applicable corrective actions. Corrective actions include installing missing hardware, doing a detailed inspection of the attaching point and attaching straps for distortion or missing parts, and repair. This material 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.

This product has been approved by the aviation authority of another country, and is approved for operation in the United States. Pursuant to the FAA's bilateral agreement with the State of Design Authority, the FAA has been notified of the unsafe condition described in the MCAI referenced above. The FAA is proposing this AD because the FAA evaluated all the relevant information and determined the unsafe condition described previously is likely to exist or develop in other products of the same type design.

This proposed AD would require accomplishing the actions specified in EASA AD 2019-0233 described previously, as incorporated by reference, except for any differences identified as exceptions in the regulatory text of this AD. This proposed AD also would require sending the inspection results to Airbus.

In the FAA's ongoing efforts to improve the efficiency of the AD process, the FAA initially worked with Airbus and EASA to develop a process to use certain EASA ADs as the primary source of information for compliance with requirements for corresponding FAA ADs. The FAA has since coordinated with other manufacturers and civil aviation authorities (CAAs) to use this process. As a result, EASA AD 2019-0233 will be incorporated by reference in the FAA final rule. This proposed AD would, therefore, require compliance with EASA AD 2019-0233 in its entirety, through that incorporation, except for any differences identified as exceptions in the regulatory text of this proposed AD. Using common terms that are the same as the heading of a particular section in the EASA AD does not mean that operators need comply only with that section. For example, where the AD requirement refers to “all required actions and compliance times,” compliance with this AD requirement is not limited to the section titled “Required Action(s) and Compliance Time(s)” in the EASA AD. Service information specified in EASA AD 2019-0233 that is required for compliance with EASA AD 2019-0233 will be available on the internet at https://www.regulations.gov by searching for and locating Docket No. FAA-2019-0982 after the FAA final rule is published.

The FAA estimates that this proposed AD affects 110 airplanes of U.S. registry. The FAA estimates the following costs to comply with this proposed AD:

The FAA estimates that it would take about 1 work-hour per product to comply with the proposed reporting requirement in this proposed AD. The average labor rate is $85 per hour. Based on these figures, the FAA estimates the cost of reporting the inspection results on U.S. operators to be $9,350, or $85 per product.

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

A federal agency may not conduct or sponsor, and a person is not required to respond to, nor shall a person be subject to penalty for failure to comply with a collection of information subject to the requirements of the Paperwork Reduction Act unless that collection of information displays a current valid OMB control number. The control number for the collection of information required by this NPRM is 2120-0056. The paperwork cost associated with this NPRM has been detailed in the Costs of Compliance section of this document and includes time for reviewing instructions, as well as completing and reviewing the collection of information. Therefore, all reporting associated with this NPRM is mandatory. Send comments regarding this burden estimate or any other aspect of this collection of information, including suggestions for reducing this burden to: Information Collection Clearance Officer, Federal Aviation Administration, 10101 Hillwood Parkway, Fort Worth, TX 76177-1524.

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 proposed 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 transport category airplanes and associated appliances to the Director of the System Oversight Division.

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

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

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

(2) 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 proposes to amend 14 CFR part 39 as follows:

Comments Invited

The FAA invites you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2019-0977; Product Identifier 2019-NM-166-AD” at the beginning of your comments. The FAA specifically invites comments on the overall regulatory, economic, environmental, and energy aspects of this NPRM. The FAA will consider all comments received by the closing date and may amend this NPRM based on those comments.

The FAA will post all comments, without change, to https://www.regulations.gov, including any personal information you provide. The FAA will also post a report summarizing each substantive verbal contact the agency receives about this NPRM.

The EASA, which is the Technical Agent for the Member States of the European Union, has issued EASA AD 2019-0232, dated September 16, 2019 (“EASA AD 2019-0232”) (also referred to as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for all Airbus SAS Model A319-131, -132, and -133 airplanes, Model A320-231, -232, and -233 airplanes, and Model A321-131, -231, and -232 airplanes.

This proposed AD was prompted by a report of rupture of a hydraulic reservoir air pressurization hose on an in-service airplane, leading to air leakage that was undetectable during normal operation, and found during subsequent zonal inspection. The FAA is proposing this AD to address this condition, which, if not detected and corrected, could lead to exposure of the wing structure to high temperatures (possibly above 200 degrees Celsius (392 degrees Fahrenheit)), possibly resulting in reduced structural integrity of the airplane. See the MCAI for additional background information.

EASA AD 2019-0232 describes procedures for modifying the airplane by replacing the affected bleed air hoses with a modification kit that includes improved bleed air hoses. This material 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.

This product has been approved by the aviation authority of another country, and is approved for operation in the United States. Pursuant to the FAA's bilateral agreement with the State of Design Authority, the FAA has been notified of the unsafe condition described in the MCAI referenced above. The FAA is proposing this AD because the FAA evaluated all the relevant information and determined the unsafe condition described previously is likely to exist or develop in other products of the same type design.

This proposed AD would require accomplishing the actions specified in EASA AD 2019-0232 described previously, as incorporated by reference, except for any differences identified as exceptions in the regulatory text of this AD.

In the FAA's ongoing efforts to improve the efficiency of the AD process, the FAA initially worked with Airbus and EASA to develop a process to use certain EASA ADs as the primary source of information for compliance with requirements for corresponding FAA ADs. The FAA has since coordinated with other manufacturers and civil aviation authorities (CAAs) to use this process. As a result, EASA AD 2019-0232 will be incorporated by reference in the FAA final rule. This proposed AD would, therefore, require compliance with EASA AD 2019-0232 in its entirety, through that incorporation, except for any differences identified as exceptions in the regulatory text of this proposed AD. Using common terms that are the same as the heading of a particular section in the EASA AD does not mean that operators need comply only with that section. For example, where the AD requirement refers to “all required actions and compliance times,” compliance with this AD requirement is not limited to the section titled “Required Action(s) and Compliance Time(s)” in the EASA AD. Service information specified in EASA AD 2019-0232 that is required for compliance with EASA AD 2019-0232 will be available on the internet at https://www.regulations.gov by searching for and locating Docket No. FAA-2019-0977 after the FAA final rule is published.

The FAA estimates that this proposed AD affects 802 airplanes of U.S. registry. The FAA estimates the following costs to comply with this proposed AD:

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

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 proposed 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 transport category airplanes and associated appliances to the Director of the System Oversight Division.

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

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

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

(2) 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.

The FAA invites you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2019-0876; Product Identifier 2019-NM-070-AD” at the beginning of your comments. The FAA specifically invites comments on the overall regulatory, economic, environmental, and energy aspects of this NPRM. The FAA will consider all comments received by the closing date and may amend this NPRM because of those comments.

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

Transport Canada Civil Aviation (TCCA), which is the aviation authority for Canada, has issued Canadian Airworthiness Directive CF-2019-11, dated March 22, 2019 (referred to after this as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for certain Bombardier, Inc., Model BD-700-1A10 and BD-700-1A11 airplanes. You may examine the MCAI in the AD docket on the internet at https://www.regulations.gov by searching for and locating Docket No. FAA-2019-0876.

This proposed AD was prompted by a report that cracking was discovered in a channel within a structural support member for the rudder quadrant, rudder feel unit assembly, and environmental control system due to fatigue. The FAA is proposing this AD to address cracking in the rudder quadrant support structure, which can lead to progressive deterioration in the performance of the systems it supports, and could eventually lead to uncommanded rudder movement and bleed air leakage. See the MCAI for additional background information.

Bombardier has issued the following service information.

• Bombardier Service Bulletin 700-53-054, dated October 1, 2018.

• Bombardier Service Bulletin 700-53-5013, dated October 1, 2018.

• Bombardier Service Bulletin 700-53-6012, dated October 1, 2018.

• Bombardier Service Bulletin 700-1A11-53-029, dated October 1, 2018.

This service information describes procedures for repetitive detailed visual inspections of the rudder quadrant box assembly for any cracking. These documents are distinct since they apply to different airplane models.

Bombardier also issued the following service information:

• Bombardier Service Bulletin 700-53-052, dated October 1, 2018.

• Bombardier Service Bulletin 700-53-6010, dated October 1, 2018.

• Bombardier Service Bulletin 700-1A11-53-027, dated October 1, 2018.

• Bombardier Service Bulletin 700-53-5011, dated October 1, 2018.

This service information describes procedures for modification of the rudder quadrant box assembly. The modification includes surface and bolt-hole eddy current inspections for cracking of the left-hand (LH) channel; a detailed visual inspection for cracking of the forward and aft half ribs and bottom and top skins; replacement of the rudder quadrant box half ribs, air systems support fitting, and LH channel; and installation of new rudder quadrant box back-up fittings. These documents are distinct since they apply to different airplane models.

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.

This product has been approved by the aviation authority of another country, and is approved for operation in the United States. Pursuant to a bilateral agreement with the State of Design Authority, the FAA has been notified of the unsafe condition described in the MCAI and service information referenced above. The FAA is proposing this AD because the agency evaluated all the relevant information and determined the unsafe condition described previously is likely to exist or develop on other products of the same type design.

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

Canadian Airworthiness Directive CF-2019-11, dated March 22, 2019, states that if any cracking is found during the repetitive detailed visual inspections of the rudder quadrant box assembly, the repair can be done within 100 flight cycles after the inspection. However, this AD requires that, for the LH channel, if the length of the crack exceeds the upper limit, the repair must be done before further flight. In addition, if the length of the crack for the LH channel is within the upper limit, the repair must be done within 50 flight cycles. These differences have been coordinated with TCCA.

The FAA estimates that this proposed AD affects 123 airplanes of U.S. registry. The FAA estimates the following costs to comply with this proposed AD:

The FAA estimates the following costs to do any necessary on-condition action that would be required based on the results of any required actions. The FAA has no way of determining the number of aircraft that might need this on-condition action:

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 proposed 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 transport category airplanes and associated appliances to the Director of the System Oversight Division.

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

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

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

2. 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 proposes to amend 14 CFR part 39 as follows:

Comments Invited

The FAA invites you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2019-0832; Product Identifier 2019-NE-28-AD” at the beginning of your comments. The FAA specifically invites comments on the overall regulatory, economic, environmental, and energy aspects of this NPRM. The FAA will consider all comments received by the closing date and may amend this NPRM because of those comments.

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

The FAA received a report of a manufacturing quality escape that identified certain diffuser case assemblies which did not meet material specification. According to an IAE investigation, the production defects in the affected diffuser case assemblies could impact the part design life and, therefore, the diffuser case assemblies require replacement. This condition, if not addressed, could result in the uncontained release of the diffuser case assembly, damage to the engine, and damage to the airplane.

The FAA reviewed IAE Non-Modification Service Bulletin (NMSB) V2500-ENG-72-0707, dated July 1, 2019. The NMSB describes procedures for replacing the affected diffuser case assemblies.

The FAA is proposing this AD because it evaluated all the relevant information and determined the unsafe condition described previously is likely to exist or develop in other products of the same type design.

IAE NMSB V2500-ENG-72-0707, dated July 1, 2019, identifies IAE V2522-A5, V2524-A5, V2527-A5, V2527E-A5, V2527M-A5, V2530-A5, and V2533-A5 turbofan engine models as applicable to replacement of the affected diffuser case assemblies. This proposed FAA AD additionally identifies V2500-A1, V2525-D5, V2528-D5, and V2531-E5 turbofan engine models to the applicability due to operators having the ability to install the affected diffuser case assemblies on any of the turbofan engine models.

This proposed AD would require removal of the affected diffuser case assembly from service and its replacement with a part eligible for installation.

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

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

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

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

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.

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

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

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

(2) 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 proposes to amend 14 CFR part 39 as follows:

Comments Invited

The FAA invites you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2019-0978; Product Identifier 2019-NM-163-AD” at the beginning of your comments. The FAA specifically invites comments on the overall regulatory, economic, environmental, and energy aspects of this NPRM. The FAA will consider all comments received by the closing date and may amend this NPRM based on those comments.

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

The FAA issued AD 2017-05-12, Amendment 39-18823 (82 FR 13382, March 13, 2017) (“AD 2017-05-12”), which applied to certain Airbus SAS Model A318-112 airplanes, Model A319-111, -112, -115, -132, and -133 airplanes, Model A320-214, -232, and -233 airplanes, and Model A321-211, -212, -213, -231, and -232 airplanes. AD 2017-05-12 requires a one-time eddy current conductivity measurement of certain cabin, cargo compartment, and frame structural parts to determine if aluminum alloy with inadequate heat treatment was used, and replacement if necessary. The FAA issued AD 2017-05-12 to address structural parts made of aluminum alloy with inadequate heat treatment, which could result in reduced structural integrity of the airplane.

Since AD 2017-05-12 was issued, it was determined that aluminum alloy with inadequate heat treatment had been used for additional structural parts.

The EASA, which is the Technical Agent for the Member States of the European Union, has issued EASA AD 2019-0196, dated August 14, 2019 (“EASA AD 2019-0196”) (also referred to as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for certain Airbus SAS Model A318-112 airplanes, Model A319-111, -112, -115, -132, and -133 airplanes, Model A320-214, -216, -232, and -233 airplanes, and Model A321-211, -212, -213, -231, and -232 airplanes. EASA AD 2019-0196 supersedes EASA AD 2015-0129, dated November 3, 2015 (which corresponds to FAA AD 2017-05-12).

This proposed AD was prompted by a determination that aluminum alloy with inadequate heat treatment was used for additional structural parts not addressed in AD 2017-05-12. The FAA is proposing this AD to address structural parts made of aluminum alloy with inadequate heat treatment, which could result in reduced structural integrity of the airplane. See the MCAI for additional background information.

The Airbus SAS Model A320-216 was U.S. type certificated on December 19, 2016. Before that date, any EASA ADs that affected Model A320-216 airplanes were included in the U.S. type certificate as part of the Required Airworthiness Actions List (RAAL). One or more Model A320-216 airplanes have subsequently been placed on the U.S. Register, and will now be included in FAA AD actions. For Model A320-216 airplanes, the requirements that correspond to AD 2017-05-12 were mandated by the MCAI via the RAAL. Although that RAAL requirement is still in effect, for continuity and clarity Model A320-216 airplanes are identified in paragraph (c) of this AD; the MCAI that is specified in paragraph (g) in this proposed AD includes restated requirements, which would therefore apply to those airplanes.

Although this proposed AD does not explicitly restate the requirements of AD 2017-05-12, this proposed AD would retain all of the requirements of AD 2017-05-12. Those requirements are referenced in EASA AD 2019-0196, which, in turn, is referenced in paragraph (g) of this proposed AD.

EASA AD 2019-0196 describes procedures for a one-time eddy current conductivity measurement of certain cabin, cargo compartment, and frame structural parts to determine if aluminum alloy with inadequate heat treatment was used, and replacement if necessary. EASA AD 2019-0196 also describes, for certain airplanes, additional work (a one-time eddy current conductivity measurement of certain other structural parts, and replacement if necessary).

This material 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.

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

This proposed AD would require accomplishing the actions specified in EASA AD 2019-0196 described previously, as incorporated by reference, except for any differences identified as exceptions in the regulatory text of this AD.

In the FAA's ongoing efforts to improve the efficiency of the AD process, the FAA initially worked with Airbus and EASA to develop a process to use certain EASA ADs as the primary source of information for compliance with requirements for corresponding FAA ADs. The FAA has since coordinated with other manufacturers and civil aviation authorities (CAAs) to use this process. As a result, EASA AD 2019-0196 will be incorporated by reference in the FAA final rule. This proposed AD would, therefore, require compliance with EASA AD 2019-0196 in its entirety, through that incorporation, except for any differences identified as exceptions in the regulatory text of this proposed AD. Using common terms that are the same as the heading of a particular section in the EASA AD does not mean that operators need comply only with that section. For example, where the AD requirement refers to “all required actions and compliance times,” compliance with this AD requirement is not limited to the section titled “Required Action(s) and Compliance Time(s)” in the EASA AD. Service information specified in EASA AD 2019-0196 that is required for compliance with EASA AD 2019-0196 will be available on the internet at https://www.regulations.gov by searching for and locating Docket No. FAA-2019-0978 after the FAA final rule is published.

The FAA estimates that this proposed AD affects 63 airplanes of U.S. registry. The FAA estimates the following costs to comply with this proposed AD:

The FAA has received no definitive data that would enable the agency to provide cost estimates for the on-condition actions specified in this proposed AD.

According to the manufacturer, some or all of the costs of this proposed AD may be covered under warranty, thereby reducing the cost impact on affected individuals. The FAA does not control warranty coverage for affected individuals. As a result, the FAA has included all known costs in our cost estimate.

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

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 proposed 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 transport category airplanes and associated appliances to the Director of the System Oversight Division.

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

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

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

(2) 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 proposes to amend 14 CFR part 39 as follows:

Authority for This Rulemaking

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. Subtitle I, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would amend the Class E airspace extending upward from 700 feet above the surface at Pratt Regional Airport, Pratt, KS, to support IFR operations at this airport.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal. Communications should identify both docket numbers and be submitted in triplicate to the address listed above. Commenters wishing the FAA to acknowledge receipt of their comments on this notice must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. FAA-2019-0902; Airspace Docket No. 19-ACE-14.” The postcard will be date/time stamped and returned to the commenter.

All communications received before the specified closing date for comments will be considered before taking action on the proposed rule. The proposal contained in this notice may be changed in light of the comments received. A report summarizing each substantive public contact with FAA personnel concerned with this rulemaking will be filed in the docket.

An electronic copy of this document may be downloaded through the internet at https://www.regulations.gov. Recently published rulemaking documents can also be accessed through the FAA's web page at https://www.faa.gov/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office (see the ADDRESSES section for the address and phone number) between 9:00 a.m. and 5:00 p.m., Monday through Friday, except federal holidays. An informal docket may also be examined during normal business hours at the Federal Aviation Administration, Air Traffic Organization, Central Service Center, Operations Support Group, 10101 Hillwood Parkway, Fort Worth, TX 76177.

This document proposes to amend FAA Order 7400.11D, Airspace Designations and Reporting Points, dated August 8, 2019, and effective September 15, 2019. FAA Order 7400.11D is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11D lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

The FAA is proposing an amendment to Title 14 Code of Federal Regulations (14 CFR) part 71 by amending the Class E airspace extending upward from 700 feet above the surface to within a 6.5-mile radius of the Pratt Regional Airport, Pratt, KS; and removing the Pratt NDB from the airspace legal description.

This action is necessary due to an airspace review caused by the decommissioning of the Pratt NDB, which provided navigation information for the instrument procedures at this airport.

Class E airspace designations are published in paragraph 6005 of FAA Order 7400.11D, dated August 8, 2019, and effective September 15, 2019, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designation listed in this document will be published subsequently in the Order. FAA Order 7400.11, Airspace Designations and Reporting Points, is published yearly and effective on September 15.

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

This proposal will be subject to an environmental analysis in accordance with FAA Order 1050.1F, “Environmental Impacts: Policies and Procedures” prior to any FAA final regulatory action.

Accordingly, pursuant to the authority delegated to me, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. Subtitle I, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would amend Class E airspace at Gunnison-Crested Butte Regional Airport, Gunnison, CO, to ensure safety and management of Instrument Flight Rules (IFR) operations at the airport.

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal. Communications should identify both docket numbers and be submitted in triplicate to the address listed above. Persons wishing the FAA to acknowledge receipt of their comments on this notice must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. FAA-2019-0341; Airspace Docket No. 18-ANM-4”. The postcard will be date/time stamped and returned to the commenter.

All communications received before the specified closing date for comments will be considered before taking action on the proposed rule. The proposal contained in this notice may be changed in light of the comments received. A report summarizing each substantive public contact with FAA personnel concerned with this rulemaking will be filed in the docket.

An electronic copy of this document may be downloaded through the internet at https://www.regulations.gov. Recently published rulemaking documents can also be accessed through the FAA's web page at https://www.faa.gov/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office (see the ADDRESSES section for the address and phone number) between 9:00 a.m. and 5:00 p.m., Monday through Friday, except federal holidays. An informal docket may also be examined during normal business hours at the Northwest Mountain Regional Office of the Federal Aviation Administration, Air Traffic Organization, Western Service Center, Operations Support Group, 2200 S 216th Street, Des Moines, WA 98198.

This document proposes to amend FAA Order 7400.11D, Airspace Designations and Reporting Points, dated August 8, 2019, and effective September 15, 2019. FAA Order 7400.11D is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11D lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

The FAA is proposing an amendment to Title 14 Code of Federal Regulations (14 CFR) Part 71 by amending Class E airspace at the Gunnison-Crested Butte Regional Airport, Gunnison, CO. The action proposes to amend the Class E airspace designated as a surface area by increasing the circular radius and adding an extension to the west of the airport. The airspace area would be defined as follows: That airspace extending upward from the surface within a 4.8-mile radius of the airport and within 1 mile each side of the 256° bearing, extending from the 4.8-mile radius to 5.7 miles west of the Gunnison-Crested Butte Regional Airport.

Also, this action proposes to amend the Class E airspace by adding a Class E airspace area designated an extension to Class D and Class E2 surface areas. This airspace area would be defined as follows: That airspace extending upward from the surface within 1.4 miles each side of the 225° bearing, extending from the 4.8-mile radius to 14.1 miles southwest of the Gunnison-Crested Butte Regional Airport.

Additionally, this action proposes a significant modification to the Class E airspace extending upward from 700 feet above the surface. The action would remove most of the area extending upward from 700 feet above the surface, from the northwest of the airport clockwise to the south of the airport. A small area would remain east of the airport and two larger areas would remain to the southwest and west of the airport. This airspace area would be defined as follows: That airspace extending upward from 700 feet above the surface, extending from the 4.8-mile radius to a 7-mile radius along the 052° bearing clockwise to the 107° bearing, and within 2.5 miles each side of the 254° bearing, extending from the 4.8-mile radius to 9.6 miles west of the airport, and within 8.1 miles north and 3.9 miles south of the 225° bearing, extending from 7.1 miles to 23.1 miles southwest of the Gunnison-Crested Butte Regional Airport.

Furthermore, this action proposes to remove the Class E airspace extending upward from 1,200 feet above the surface. This airspace area is wholly contained within the Denver Class E6 en route airspace area and duplication is not necessary.

Lastly, the action proposes administrative corrections to the airspace's legal descriptions. The geographic coordinates need to be updated to (lat. 38°32′04″ N, long. 106°55′54″ W) to match the FAA's aeronautical database. The Class E surface airspace should be full time; the following two sentences do not accurately represent the time of use for this airspace area and need to be removed: “This Class E airspace area is effective during specific dates and times established in advance by a Notice to Airmen. The effective date and time will thereafter be continuously published in the Airport/Facility Directory.”

Class E airspace designations are published in paragraphs 6002, 6004 and 6005 of FAA Order 7400.11D, dated August 8, 2019, and effective September 15, 2019, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designations listed in this document will be published subsequently in the Order. FAA Order 7400.11, Airspace Designations and Reporting Points, is published yearly and effective on September 15.

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

This proposal will be subject to an environmental analysis in accordance with FAA Order 1050.1F, “Environmental Impacts: Policies and Procedures” prior to any FAA final regulatory action.

Accordingly, pursuant to the authority delegated to me, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

Authority for This Rulemaking

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. Subtitle I, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would remove Class E airspace at Cecil Airport, and amend Class D and E airspace in the Jacksonville, FL area to support IFR operations in the area. FAA Order 7400.11, Airspace Designations and Reporting Points, is published yearly and effective on September 15.

Interested persons are invited to comment on this proposed rulemaking by submitting such written data, views, or arguments, as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal.

Communications should identify both docket numbers (Docket No. FAA-2019-0932 and Airspace Docket No. 19-ASO-24) and be submitted in triplicate to DOT Docket Operations (see ADDRESSES section for the address and phone number.) You may also submit comments through the internet at http://www.regulations.gov.

Persons wishing the FAA to acknowledge receipt of their comments on this action must submit with those comments a self-addressed stamped postcard on which the following statement is made: “Comments to FAA Docket No. FAA-2019-0932; Airspace Docket No. 19-ASO-24.” The postcard will be date/time stamped and returned to the commenter.

All communications received before the specified closing date for comments will be considered before taking action on the proposed rule. The proposal contained in this document may be changed in light of the comments received. All comments submitted will be available for examination in the public docket both before and after the comment closing date. A report summarizing each substantive public contact with FAA personnel concerned with this rulemaking will be filed in the docket.

An electronic copy of this document may be downloaded through the internet at https://www.regulations.gov. Recently published rulemaking documents can also be accessed through the FAA's web page at https://www.faa.gov/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received and any final disposition in person in the Dockets Office (see the ADDRESSES section for address and phone number) between 9:00 a.m. and 5:00 p.m., Monday through Friday, except federal holidays. An informal docket may also be examined between 8:00 a.m. and 4:30 p.m., Monday through Friday, except federal holidays at the office of the Eastern Service Center, Federal Aviation Administration, Room 350, 1701 Columbia Avenue, College Park, GA 30337.

This document proposes to amend FAA Order 7400.11D, Airspace Designations and Reporting Points, dated August 8, 2019, and effective September 15, 2019. FAA Order 7400.11D is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11D lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

The FAA proposes an amendment to Title 14 Code of Federal Regulations (14 CFR) part 71 to remove Class E surface airspace designated as an extension to a Class D surface area at Cecil Airport due to the decommissioning of the Cecil VOR. The FAA also proposed to amend Class D airspace and Class E airspace extending upward from 700 feet or more above the surface by recognizing the name changes of Jacksonville NAS (Towers Field), (previously Jacksonville NAS), and Herlong Recreational Airport, (previously Herlong Airport), and Jacksonville Executive Airport at Craig, (previously Craig Municipal Airport), Jacksonville, FL. Also, the geographic coordinates of these airports would be adjusted to coincide with the FAA's aeronautical database. In addition, the FAA proposes to replace the outdated term Airport/Facility Directory with the term Chart Supplement in the associated Class D airspace legal descriptions for these airports.

Class D airspace designations, Class E airspace areas designated as an extension to a Class D or E surface area, and Class E airspace areas extending upward from 700 feet or more above the surface are published in Paragraphs 5000, 6004, and 6005, respectively of FAA Order 7400.11D, dated August 8, 2019, and effective September 15, 2019, which is incorporated by reference in 14 CFR 71.1. The Class D and E airspace designations listed in this document will be published subsequently in the Order.

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

This proposal will be subject to an environmental analysis in accordance with FAA Order 1050.1F, “Environmental Impacts: Policies and Procedures” prior to any FAA final regulatory action.

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

Authority for This Rulemaking

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. Subtitle I, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would amend Class D and E airspace at Boire Field, Nashua, NH, to support IFR operations in the area.

Interested persons are invited to comment on this proposed rulemaking by submitting such written data, views, or arguments as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal.

Communications should identify both docket numbers (Docket No. FAA-2019-0921 and Airspace Docket No. 19-ANE-7) and be submitted in triplicate to DOT Docket Operations (see ADDRESSES section for the address and phone number.) You may also submit comments through the internet at https://www.regulations.gov.

Persons wishing the FAA to acknowledge receipt of their comments on this action must submit with those comments a self-addressed stamped postcard on which the following statement is made: “Comments to FAA Docket No. FAA-2019-0921; Airspace Docket No. 19-ANE-7.” The postcard will be date/time stamped and returned to the commenter.

All communications received before the specified closing date for comments will be considered before taking action on the proposed rule. The proposal contained in this document may be changed in light of the comments received. All comments submitted will be available for examination in the public docket both before and after the comment closing date. A report summarizing each substantive public contact with FAA personnel concerned with this rulemaking will be filed in the docket.

An electronic copy of this document may be downloaded through the internet at https://www.regulations.gov. Recently published rulemaking documents can also be accessed through the FAA's web page at https://www.faa.gov/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received and any final disposition in person in the Dockets Office (see the ADDRESSES section for address and phone number) between 9:00 a.m. and 5:00 p.m., Monday through Friday, except federal holidays. An informal docket may also be examined between 8:00 a.m. and 4:30 p.m., Monday through Friday, except federal holidays, at the office of the Eastern Service Center, Federal Aviation Administration, Room 350, 1701 Columbia Avenue, College Park, GA 30337.

This document proposes to amend FAA Order 7400.11D, Airspace Designations and Reporting Points, dated August 8, 2019, and effective September 15, 2019. FAA Order 7400.11D is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11D lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

The FAA proposes an amendment to Title 14 Code of Federal Regulations (14 CFR) part 71 to amend Class D, Class E airspace designated as an extension to a Class D surface area, and Class E airspace extending upward from 700 feet or more above the surface at Boire Field, Nashua, NH, by eliminating the northwest extension of the airport due to the cancellation of the NDB approach. The FAA also proposes to update the geographic coordinates of Boire Field and Manchester VORTAC to coincide with the FAA's aeronautical database. In addition, this action would recognize the name change of Pepperell Airport (formerly Sports Center Airport). Also, an editorial change would be made replacing the outdated term Airport/Facility Directory with the term Chart Supplement in the associated Class D and E airspace legal descriptions for Boire Field.

Class D and Class E airspace designations are published in Paragraphs 5000, 6004, and 6005, respectively of FAA Order 7400.11D, dated August 8, 2019, and effective September 15, 2019, which is incorporated by reference in 14 CFR 71.1. The Class D and E airspace designations listed in this document will be published subsequently in the Order. FAA Order 7400.11, Airspace Designations and Reporting Points, is published yearly and effective on September 15.

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

This proposal will be subject to an environmental analysis in accordance with FAA Order 1050.1F, paragraph 5-6.5(a), “Environmental Impacts: Policies and Procedures” prior to any FAA final regulatory action.

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

A. Submitting Comments

If you submit a comment, please include the docket number for this document (Docket No. FMCSA-2019-0151), indicate the specific section of this document to which each comment applies, and provide a reason for each suggestion or recommendation. You may submit your comments and material online or by fax, mail, or hand delivery, but please use only one of these means. FMCSA recommends that you include your name and a mailing address, an email address, or a telephone number in the body of your document so that FMCSA can contact you if there are questions regarding your submission.

To submit your comment online, go to http://www.regulations.gov, put the docket number, FMCSA-2019-0151, in the keyword box, and click “Search.” When the new screen appears, click on the “Comment Now!” button and type your comment into the text box on the following screen. Choose whether you are submitting your comment as an individual or on behalf of a third party and then submit.

If you submit your comments by mail or hand delivery, submit them in an unbound format, no larger than 81/2 by 11 inches, suitable for copying and electronic filing. If you submit comments by mail and would like to know that they reached the facility, please enclose a stamped, self-addressed postcard or envelope.

FMCSA will consider all comments and material received during the comment period and may change this proposed rule based on your comments. FMCSA may issue a final rule at any time after the close of the comment period.

Confidential Business Information (CBI) is commercial or financial information that is customarily not made available to the general public by the submitter. Under the Freedom of Information Act (5 U.S.C. 552), CBI is eligible for protection from public disclosure. If you have CBI that is relevant or responsive to this document, it is important that you clearly designate the submitted comments as CBI. Accordingly, please mark each page of your submission as “confidential” or “CBI.” Submissions designated as CBI and meeting the definition noted above will not be placed in the public docket of this document. Submissions containing CBI should be sent to Brian Dahlin, Chief, Regulatory Evaluation Division, Federal Motor Carrier Safety Administration, 1200 New Jersey Avenue SE, Washington, DC 20590-0001. Any commentary that FMCSA receives that is not specifically designated as CBI will be placed in the public docket for this document.

To view comments, as well as any documents mentioned in this preamble as being available in the docket, go to http://www.regulations.gov. Insert the docket number, FMCSA-2019-0151 in the keyword box, and click “Search.” Next, click the “Open Docket Folder” button and choose the document to review. If you do not have access to the internet, you may view the docket online by visiting the Docket Management Facility in Room W12-140 on the ground floor of the DOT West Building, 1200 New Jersey Avenue SE, Washington, DC 20590-0001, between 9 a.m. and 5 p.m. ET, Monday through Friday, except Federal holidays.

In accordance with 5 U.S.C. 553(c), DOT solicits comments from the public to better inform its rulemaking process. DOT posts these comments, without edit, including any personal information the commenter provides, to www.regulations.gov, as described in the system of records notice (DOT/ALL-14 FDMS), which can be reviewed at www.transportation.gov/privacy.

The current hearing standard under 49 CFR 391.41(b)(11) was adopted in 1970, with a revision in 1971 to allow drivers to be qualified under this standard while wearing a hearing aid, 35 FR 6458, 6463 (April 22, 1970) and 36 FR 12857 (July 3, 1971).1

On May 25, 2012, FMCSA published a notice requesting public comment on the application from NAD for an exemption from the regulatory requirement in 49 CFR 391.41(b)(11) on behalf of 45 deaf drivers (77 FR 31423). The Agency received 570 comments in response to that notice, and 40 of the 45 applicants were granted exemptions (78 FR 7479). Since that time, FMCSA has granted more than 450 hearing exemptions to individuals who do not meet the hearing standard. In doing so, FMCSA has published numerous Federal Register notices announcing receipt of hearing exemption applications and requesting public comment, prior to granting the individual exemptions. See, e.g., 84 FR 5544 (February 21 2019); 84 FR 21392 (May 14, 2019).

Currently, § 391.11(b)(2) requires that interstate CMV drivers read and speak the English language sufficiently to converse with the general public, to understand highway traffic signs and signals in the English language, to respond to official inquiries, and to make entries on reports and records.

The requirement to speak was adopted on December 23, 1936 by the Interstate Commerce Commission (ICC), the Federal agency responsible for motor carrier safety prior to the establishment of the U.S. Department of Transportation. (1 M.C.C. 1, at 18-19).

On May 27, 1939, the ICC made certain changes and additions to the Motor Carrier Safety Regulations, including elimination of the exceptions granted by the original rules for those drivers unable to read and speak English. As stated in that notice, “The intent of the Commission to require such ability of all drivers in this service has been unmistakable since 1937, and the intervening period of more than two years is regarded as sufficient to justify the removal of the exception.” (14 M.C.C. 669, at 675). The requirements have remained essentially unchanged since the 1930s.

On May 9, 2011 (76 FR 26854), FMCSA published a final rule amending the CDL knowledge and skills testing standards. The final rule included prohibitions against the use of interpreters during the administration of the CDL knowledge and skills tests. Section 383.133(b)(3) provides that the CDL knowledge tests may be administered in written form, verbally, or in automated format and can be administered in a foreign language, provided that no interpreter is used in administering the test. Section 383.133(c)(5) prohibits interpreters during the administration of skills tests. Paragraph (c)(5) also states that applicants must be able to understand and respond to verbal commands and instructions in English by a skills test examiner. Neither the applicant nor the examiner may communicate in a language other than English during the skills test.

NAD petitioned FMCSA to change its safety regulations so that deaf and hard of hearing individuals would be allowed to operate CMVs in interstate commerce. Although FMCSA has granted exemptions from § 391.41(b)(11) concerning physical qualifications for deaf and hard of hearing individuals as noted above, NAD believes the rule should be changed to eliminate the regulatory barrier to these individuals operating CMVs in interstate commerce. NAD also contends that both the hearing requirement for physical qualification to operate a commercial vehicle and the speaking requirement are violations of the Rehabilitation Act of 1973.2 A copy of the petition is included in the docket referenced at the beginning of this document.

In granting the exemptions discussed above, the Agency did not provide relief from the requirement that drivers be able to communicate in English and the prohibition against interpreters during the CDL knowledge and skills tests. However, the Agency has provided clarifications on how these requirements should be applied in the context of deaf or hard of hearing individuals.

On December 29, 2017 (82 FR 61809), FMCSA published a notice announcing its response to certain substantive comments submitted to one of the notices regarding the granting of exemptions from the hearing requirement for multiple drivers. The Agency explained that the restriction under 49 CFR 383.133(c)(5) does not mean that a skills test cannot be accomplished with a deaf or hard of hearing individual. The 2017 notice stated:

After the publication of the December 29, 2017, notice, several motor carriers and CDL training providers shared with FMCSA their concerns about safety when it comes to behind-the-wheel training of deaf or hard of hearing individuals. Behind-the-wheel training requires communication between the instructor and the student while the vehicle is in motion under a variety of conditions. This includes operating on public roads in traffic, and at highway speeds. Given that deaf and hard of hearing individuals rely on sign language, written messages or other visual indicators, training providers have expressed concerns about safety when the students take their eyes off the road to focus on communication with the instructor.

Motor carriers also raised concerns about work-place safety with such individuals. Safety concerns include identifying effective alternatives to audible alerts and warnings for hazardous conditions, such as trucks backing around loading docks and driven around terminals.

The FMCSA requests public comments on NAD's petition for rulemaking, with a focus on five areas of concern:

FMCSA's hearing requirement is applicable to individuals who operate CMVs (as defined in 49 CFR 390.5) in interstate commerce, regardless of whether they are required to have a CDL. There are also some regulatory exemptions from the physical qualification requirements. See, generally, 49 CFR 390.3(f) and 391.2. Therefore, some individuals seeking CDL training have not been, and would not be, subject to the hearing standard. This includes, for example, individuals that drive or plan to drive for Federal, State or local government agencies that do not impose the same physical qualification requirements on their employees, etc. What actions have CDL training providers, including governmental entities providing such training, taken to address the needs of CDL applicants seeking employment opportunities in transportation sectors that are exempt from FMCSA's physical qualifications standards and to what extent would these practices be helpful to training providers preparing drivers to operate in sectors subject to FMCSA's physical qualifications standards? How do CDL training providers ensure safe operations during behind-the-wheel training of deaf and hard of hearing individuals on public roads?

With the granting of hearing exemptions as discussed above, some State Driver Licensing Agencies (SDLAs) have raised concerns about challenges administering the CDL skills test to deaf and hard of hearing individuals. The SDLAs expressed concern that the prohibition against interpreters during the skills test precludes the administration of the tests if the CDL examiner is not capable of communicating with sign language.

In addition, SDLAs have expressed concerns about safety of operations when the CDL examiner must communicate with the applicant while the vehicle is in operation on a public road.

FMCSA requests information from the SDLAs concerning challenges their examiners have experienced administering the CDL skills test under such circumstances and what accommodations, if any, have been made to complete the skills test while complying with the prohibition against the use of interpreters. The Agency also requests comment on steps taken to address or minimize the time applicants must take their eyes off the road to receive instruction or feedback from the CDL examiner.

FMCSA has statutory direction to ensure that operation of a CMV does not have a deleterious effect on the health of CMV operators. To consider the impact of a change in the hearing requirement on driver health, the Agency requests comments from motor carriers about their concerns about ensuring the safety of deaf and hard of hearing individuals at facilities where trucks are loaded and unloaded, and terminals at which trucks may be operated with workers walking around. Under such scenarios, deaf or hard of hearing individuals would not be able to hear audible alarms or signals of workplace hazards. The Agency requests information about safety precautions that are being taken to accommodate such individuals and the experiences of these employers with workplace incidents and injuries.

In consideration of the areas highlighted above, the Agency request comments on whether the Agency should grant NAD's petition for rulemaking, in whole or in part, and initiate a notice-and-comment rulemaking proceeding. The Agency seeks information on whether a regulatory change would significantly increase the number of individuals seeking training and employment as interstate CMV drivers. Also, would CDL training providers and motor carriers face additional challenges if the population of deaf and hard of hearing individuals seeking entry into the industry increased significantly?

As noted above, the Agency has granted more than 450 hearing exemptions since 2012. The exemptions cover a range of circumstances necessitating relief from the hearing standard, from individuals with CDLs in need of an exemption to allow them to operate in interstate commerce, to individuals seeking a CDL to begin a career in the interstate motor carrier industry. The exemptions also cover individuals interested in operating CMVs for which a CDL is not required. If FMCSA denies the NAD petition for rulemaking, should the Agency continue granting exemptions, or consider limiting the exemptions to certain categories such as individuals intending to operate CMVs for which a CDL is not required, or individuals who already hold a CDL?

The Sanctuary was designated as the nation's first national marine sanctuary in 1975. The site protects the wreck of the famed Civil War ironclad U.S.S. Monitor. The U.S.S. Monitor is located approximately 15 miles southeast of Cape Hatteras, North Carolina. The Sanctuary currently surrounds the shipwreck and consists of a vertical column of water one mile (1.61 km) in diameter (0.78 square miles (2.02 square km) in size) extending from the seabed to the surface, the center of which is at 35°00′23″ north latitude and 75°24′32″ west longitude (15 CFR 922.60). The U.S.S. Monitor is in water depths of 240 feet (22.3 m).

Fishing in Federal waters off North Carolina is economically and socially vital to the state's residents, visitors, and coastal communities. Commercial and recreational fishing provides an important source of employment, income, recreation, and food, and is a significant driver for local tourism.

The United States claims sovereign rights and exclusive fishery management authority over fish within the U.S. Exclusive Economic Zone (EEZ), an area extending 200 nautical miles (370.4 km) from the seaward boundary of coastal states and U.S. territories (16 U.S.C. 1811(a)). Within the EEZ, Federal fishery management is conducted under the authority of the Magnuson Stevens Fishery Conservation and Management Act (MSA) (16 U.S.C. 1801 et seq.). NMFS, acting under authority delegated from the Secretary of Commerce, is responsible for managing fisheries pursuant to the MSA. To assist in fishery management, the MSA established eight regional fishery management councils that develop and submit fishery management plans to NMFS (16 U.S.C. 1852(a)) for specific geographic areas. NMFS is responsible for developing fishery management plans for Atlantic highly migratory species (16 U.S.C. 1852(a)(3)).

This action affects regulations codified in the General Provisions for Domestic Fisheries (50 CFR part 600, subpart H). The proposed action would alleviate the potential for confusion regarding the fishing restrictions applicable to the Monitor National Marine Sanctuary or other sanctuaries. NMFS is taking this action pursuant to MSA § 305(d), which gives the Agency general authority to carry out fishery management plans adopted under the MSA.

A Sanctuary regulation (15 CFR 922.61) includes specific restrictions applicable to fishing. Provisions that limit fishing and activities associated with fishing are: Anchoring in any manner, stopping, remaining, or drifting without power at any time; diving of any type, whether by an individual or by a submersible; lowering below the surface of the water any grappling, suction, conveyor, dredging or wrecking device; and trawling.

In reviewing its regulations, NMFS noted that 50 CFR 600.705(f) cross-references the Sanctuary regulation, but includes broader language that prohibits “all fishing activity” in the Sanctuary.

The marine sanctuary regulations under 15 CFR part 924 were changed to 15 CFR part 922, on December 27, 1995 (60 FR 66875). The broader prohibition on all fishing at 50 CFR 600.705(f) appears to be inadvertent and the result of consolidation of regulations for specific fisheries into the General Provisions for Domestic Fisheries.

This proposed action will remove text at 50 CFR 600.705(f), which states that all fishing in the Sanctuary is prohibited by Sanctuary regulations. This text is unnecessary and inconsistent with the Sanctuary's regulations and policies, which prohibit some, but not all, fishing activity in the Sanctuary. In 50 CFR 600.705(f), NMFS will retain an updated cross-reference to the Office of National Marine Sanctuaries' regulations at 15 CFR part 922.

The NMFS Assistant Administrator has determined that the proposed rule is consistent with the MSA and other applicable laws, subject to further consideration after public comment.

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

This rule is expected to be an Executive Order 13771 deregulatory action.

The Chief Counsel for Regulation of the Department of Commerce certified to the Chief Counsel for Advocacy of the Small Business Administration (SBA) that this proposed rule, if adopted, would not have a significant economic impact on a substantial number of small entities. A description of the factual basis for this determination follows.

This proposed rule removes an unnecessary fishery regulation that inadvertently included an overly broad interpretation of a Sanctuary regulation. The existing Sanctuary regulation will continue to prohibit stopping, remaining, or drifting without power in the Sanctuary, which significantly curtails most fishing activity in the Sanctuary. The proposed action could result in a slight increase in fishing activity in the Sanctuary, to the extent that NMFS's regulation had discouraged such activity.

This rule would remove an unnecessary regulation that applies to vessels (businesses) in the commercial harvesting and for-hire fishing industries. The SBA has established size criteria for all major industry sectors in the U.S., including fish harvesters. On December 29, 2015, NMFS issued a final rule establishing a small business size standard of $11 million in annual gross receipts for all businesses primarily engaged in the commercial fishing industry (NAICS 11411) for Regulatory Flexibility Act (RFA) compliance purposes only (80 FR 81194). The $11 million standard became effective on July 1, 2016, and is to be used in place of the SBA's current standards of $20.5 million, $5.5 million, and $7.5 million for the finfish (NAICS 114111), shellfish (NAICS 114112), and other marine fishing (NAICS 114119) sectors of the U.S. commercial fishing industry in all NMFS rules subject to the RFA after July 1, 2016 (80 FR 81194, December 29, 2015).

On July 18, 2019, the SBA issued an interim final rule (84 FR 34261) effective August 19, 2019, that adjusted the monetary-based industry size standards (i.e., receipts- and assets-based) for inflation for many industries. For fisheries for-hire businesses, the rule changes the small business size standard from $7.5 million in annual gross receipts to $8 million (See 84 FR at 34273) (adjusting NAICS 487990 (Scenic and Sightseeing Transportation, Other)).

Commercial fishing vessels whose owners possess valid commercial permit(s) for the South Atlantic EEZ (e.g., Tunas General category, Atlantic Tunas Longline, Atlantic Tunas Harpoon, Dolphin/Wahoo, and Atlantic Swordfish General Commercial) and harvest eligible species with hook and line or longline gear off the coast of North Carolina may be affected by this rule. As of May 7, 2019, 2633 vessels with valid commercial permits for the South Atlantic EEZ reported landings using hook and line or longline gear with 233 hailing from North Carolina. Of these, 82 of the 233 vessels landed in North Carolina in 2018. These 82 entities could be directly affected by this action.

The for-hire fleet is comprised of charter vessels, which charge a fee on a vessel basis, and headboats, which charge a fee on an individual angler (head) basis. The harvest of various species in the EEZ by for-hire vessels requires a charter vessel/headboat permit (e.g., Atlantic Highly Migratory Species Charter/Headboat, Atlantic Charter/Headboat for Dolphin Wahoo, South Atlantic Charter/Headboat for Pelagic Fish, and South Atlantic Charter/Headboat for Snapper/Grouper). The registration address for the Federal permit does not restrict operation to Federal waters off that state. As of September 19, 2019, there were 4904 vessels with valid or renewable for-hire permits. Of the 4904 vessels, 497 vessels were registered in North Carolina, with several entities owning multiple vessels. Based on the registered permit address, 439 for-hire businesses eligible to fish in the EEZ off North Carolina could be directly affected by the proposed action.

The Sanctuary is relatively small, covering approximately one mile (1.61 km) in diameter (0.78 square miles in size; 2.02 square km). Limited data is available to determine how much harvesting activity is currently occurring or may occur in the Sanctuary if NMFS clarifies its regulation as proposed. As such, it is not possible to quantitatively determine the potential effects of this proposed rule. Considerable uncertainty exists regarding those potential effects. However, it is highly likely the economic benefits would be neutral to a slight increase. Vessels that might have been discouraged from fishing by NMFS's regulation may seek to fish in the Sanctuary, consistent with the Sanctuary regulations, if NMFS's rule is clarified as proposed. However, given the presence of similar or better fishing grounds closer to shore which are not subject to the Sanctuary's restrictions, vessels may not seek to fish in the Sanctuary.

NMFS assumes that the 82 commercial fishing vessels and 439 for-hire businesses, described above, are small entities and has determined that possible impacts of this proposed rule on those entities will not be significant.

Because this rule, if implemented, is not expected to have a significant adverse economic effect on the profits of a substantial number of small entities, an initial regulatory flexibility analysis is not required and none has been prepared.

For the reasons stated in the preamble, 50 CFR part 600 is proposed to be amended as follows: