On September 11, 2020, DHS published a notice of proposed rulemaking (NPRM or proposed rule) titled “Collection and Use of Biometrics by U.S. Citizenship and Immigration Services” in the Federal Register (85 FR 56338). This rule proposed to amend DHS regulations concerning the use and collection of biometrics in the enforcement and administration of immigration laws by U.S. Citizenship and Immigration Services (USCIS), U.S. Customs and Border Protection (CBP), and U.S. Immigration and Customs Enforcement (ICE). DHS is withdrawing the September 11, 2020, NPRM for a number of reasons.

In response to the NPRM, DHS received 5,147 comments during the 30-day public comment period, and 192 comments on the rule's information collection requirements before the comment period ended. Commenters consisted of individuals, advocacy groups, legal service providers, professional associations, State or local governments, and social organizations. The majority of commenters expressed general opposition to the rule, mentioning immigration policy concerns, general privacy concerns, and economic concerns (both to individuals and communities). Many commenters wrote that the rule was unnecessary, offensive, an invasion of privacy, would infringe on freedoms, and violate the respect, privacy rights, and civil liberties of U.S. citizens, legal immigrants, noncitizens, victims of domestic violence, other vulnerable parties, and children. Many commenters stated that the rule was overly broad, highly invasive, and would impose excessive monetary costs on applicants and result in administrative delays in adjudicating immigration benefit requests that are already subjected to backlogs and long waits.

Executive Order 14012, “Restoring Faith in Our Legal Immigration Systems and Strengthening Integration and Inclusion Efforts for New Americans,” in section 3(a)(i), instructs the Secretary of Homeland Security to identify barriers that impede access to immigration benefits. 86 FR 8277, (Feb. 5, 2021) (“E.O. 14012”). Having reviewed the public comments received in response to the NPRM in light of Executive Order 14012, DHS has decided to withdraw the NPRM. The proposed rule was intended to provide DHS with the flexibility to change its biometrics collection practices and policies to ensure that necessary adjustments can be made to meet emerging needs, enhance the use of biometrics beyond background checks and document production to include identity verification and management in the immigration lifecycle, enhance vetting to lessen the dependence on paper documents to prove identity and familial relationships, preclude imposters, and improve the consistency in biometrics terminology within DHS. DHS still supports the goals of the NPRM to have flexibility in its immigration benefit administration biometrics collection practices and policies and enhance the use of biometrics for identity verification and management but not in a way that conflicts with Executive Order 14012. DHS, USCIS, CBP, and ICE remain committed to national security, identity management, fraud prevention and program integrity, and will continue to require the submission of biometrics where appropriate. See, e.g., INA section 333 and 335 (requiring submission of photographs and a personal investigation before an application for naturalization may be approved); INA section 264(a) (directing the collection of fingerprints for the purpose of registering aliens); 8 U.S.C. 1732(b)(1) (requiring that alien visas and other travel and entry documents use biometric identifiers); 8 U.S.C. 1365a-1365b (requiring creation of a biometric data system for national security purposes). DHS may engage in a future rulemaking to enhance our biometrics requirements while not hindering access to the immigration system and protecting privacy and civil liberties.

However, commenters suggested that the breadth of the biometrics submission requirements that were proposed in the proposed rule are more than what is necessary to meet the requirements of the adjudication of immigration and naturalization benefits. DHS has considered the commenters concerns, and believe some of them may be justified and require additional deliberation. Accordingly, DHS is withdrawing the NPRM and will analyze the entirety of the NPRM in the context of the directive in E.O. 14012 and what changes may be appropriate and consistent with DHS's needs, policies, and applicable law. In the meantime, DHS' current biometrics collection practices and policies are sufficient to meet the statutory and regulatory requirements for document production and the vetting of any applicant, petitioner, sponsor, beneficiary, or individual filing or associated with an immigration benefit or request, including United States citizens.

As stated in the NPRM, DHS has general and specific statutory authority to collect or require submission of biometrics from applicants, co-applicants, petitioners requestors, derivatives, beneficiaries and others directly associated with a request for immigration benefits; and for purposes incident to apprehending, arresting, processing, and care and custody of aliens. 85 FR 56347. DHS is withdrawing the NPRM using those same authorities.

On November 19, 2020, DHS published an NPRM titled “Employment Authorization for Certain Classes of Aliens With Final Orders of Removal.” (85 FR 74196). This NPRM proposed to eliminate employment authorization under 8 CFR 274a.12(c)(18) for individuals who have a final order of removal and are released on an order of supervision with a narrow exception. DHS also proposed to amend its regulations to clearly indicate that individuals who have been granted CAT deferral of removal would be employment authorized based on their grant of CAT deferral of removal.

In response to the NPRM, DHS received more than 302 comments during the 30-day public comment period. Nearly 98 percent of commenters opposed the proposed rule with several commenters specifically requesting that DHS withdraw the NPRM. 1 Less than 2 percent expressed support for the rule with such commenters generally supporting the rule because they believed it would deter illegal immigration and protect U.S. workers. The commenters who opposed the NPRM argued that it would significantly limit the ability of individuals who have a final order of removal and are released on an order of supervision to legally work, be self-sufficient, and support their families, which may include U.S. citizen children and lawful permanent resident spouses or partners. Several commenters also noted the proposed rule would impose exorbitant costs and burdens on U.S. employers related to labor turnover and the proposed E-Verify requirement. Various state and local agencies, including Attorneys General from 15 states, also opposed the rule on the basis it would decrease tax revenue, deny states various revenue streams, and increase costs related to state-funded public benefit programs. Many commenters also disagreed with the NPRM's assertion that the proposed changes would incentivize individuals with final orders of removal to leave the United States. They argued that the majority of individuals who have a final order of removal and are released on an order of supervision are in the United States with DHS's acknowledgment, as reflected by their release on an order of supervision, and that DHS's inability to remove them primarily stems not from inaction on the individual's part but due to the unwillingness of foreign governments to issue them travel documents and cooperate in their repatriation.

The NPRM stemmed from two executive orders issued by President Trump, which have been revoked since the publication of the NPRM. DHS initiated the regulatory action pursuant to Executive Order 13768, “Enhancing Public Safety in the Interior of the United States” (Jan. 24, 2017) and Executive Order 13788, “Buy American and Hire American” (Apr. 18, 2017). These executive orders directed DHS to revise or rescind any regulations inconsistent with these orders. DHS issued the NPRM after determining that the current regulations at 8 CFR 274a.12(c)(18) could be inconsistent with the above-mentioned executive orders.

On January 20, 2021, President Biden issued Executive Order 13993, “Revision of Civil Immigration Enforcement Policies and Priorities,” which revoked Executive Order 13768. Further, on January 25, 2021, President Biden issued Executive Order 14005, “Ensuring the Future Is Made in All of America by All of America's Workers,” which revoked Executive Order 13788. Executive Orders 13993 and 14005 directed agencies to review, revise, or rescind any agency actions or guidance inconsistent with the executive orders.

Having reviewed the NPRM and the public comments in light of Executive Orders 13993 and 14005, DHS has decided to withdraw the NPRM. The original bases and rationale for promulgating the NPRM no longer align with the current Administration's immigration enforcement priorities. This Administration is focused on protecting the interests of American workers by ensuring the “[Federal Government] . . . procure[s] goods, products, materials, and services from sources that will help American businesses compete in strategic industries and help America's workers thrive.” By withdrawing the proposed rule, the Administration will allow individuals with final orders of removal who are released from DHS custody on an order of supervision, and are in a position to work, to continue to work for American businesses that provide services in key industries and to supplement the existing U.S. workforce.

As noted in Executive Order 13933, which articulates the Administration's overarching values and priorities on civil immigration enforcement, “the task of enforcing the immigration laws is complex and requires setting priorities to best serve the national interest.”  2 DHS has been directed to focus its limited resources on national and border security, addressing the humanitarian challenges at the southern border, and ensuring public health and safety. 3 In doing so, DHS must develop enforcement priorities and use its limited resources to pursue those priorities. Additionally, the limited resources of the agency and the significant operational challenges caused by the COVID-19 pandemic do not allow DHS to respond to all immigration violations or remove all individuals with a final order of removal. 4 DHS's enforcement priorities, including removals, are to be focused on national security, public safety, and border security. 5

DHS believes that continuing to provide employment authorization to individuals who have a final order of removal and are released from DHS custody on an order of supervision is consistent with this Administration's values and priorities on immigration enforcement. It will allow individuals who do not fall within the Administration's enforcement priorities and who are still in the United States to continue to qualify for employment authorization, to legally work, remain self-sufficient, and support their families, which in many instances include U.S. citizen children.

This withdrawal notice does not affect the continued employment eligibility of individuals who have been granted CAT deferral of removal. Such individuals currently qualify for employment authorization under 8 CFR 274a.12(c)(18) and will continue to do so. The primary purpose behind the proposed regulatory amendments related to individuals with CAT deferral of removal was to clearly indicate in the regulations that individuals with CAT deferral of removal are eligible for employment authorization. Even though DHS is not pursuing the proposed regulatory amendments at this time, individuals who are granted CAT deferral of removal will continue to qualify for employment authorization under 8 CFR 274a.12(c)(18). DHS plans to consider similar regulatory amendments clarifying eligibility for employment authorization for individuals with CAT deferral of removal as part of future rulemaking efforts consistent with DHS's priorities, policies, and applicable law.

For all the reasons discussed above, DHS is withdrawing the NPRM.

As stated in the NPRM, DHS has general and specific statutory authority to detain individuals with final orders of removal, release such individuals from custody on an order of supervision, and grant them employment authorization. 85 FR 74211. DHS is withdrawing the NPRM using those same authorities. Executive Order 13993, “Revision of Civil Immigration Enforcement Policies and Priorities;” Executive Order 14005, “Ensuring the Future Is Made in All of America by All of America's Workers;” 8 U.S.C. 1324a(h)(3); and 8 U.S.C. 1231(a)(7).

Table of Contents I. Introduction A. Authority B. Background II. Request for Information III. Submission of Comments I. Introduction

The following section briefly discusses the statutory authority underlying this request for information, as well as some of the historical background relevant to the potential inclusion of commercial and industrial fans as covered equipment under the Energy Policy and Conservation Act, as amended (“EPCA”). 1

EPCA authorizes DOE to regulate the energy efficiency of a number of consumer products and certain industrial equipment. (42 U.S.C. 6291-6317) Title III, Part C  2 of EPCA established the Energy Conservation Program for Certain Industrial Equipment, which sets forth a variety of provisions designed to improve energy efficiency of certain commercial and industrial equipment (hereafter referred to as “covered equipment”).

EPCA specifies a list of equipment that constitutes covered equipment. (42 U.S.C. 6311(1)) EPCA also provides that “covered equipment” includes any other type of industrial equipment for which the Secretary of Energy (“Secretary”) determines inclusion is necessary to carry out the purpose of this part. (42 U.S.C. 6311(1)(L); 42 U.S.C. 6312(b)) EPCA specifies the types of industrial equipment that can be classified as covered equipment. This industrial equipment includes fans and blowers. (42 U.S.C. 6311(2)(B)(ii) and (iii)) Additionally, in order to be classified as covered equipment, the industrial equipment must be of a type that: (1) Consumes, or is designed to consume, energy in operation; (2) is distributed in commerce for industrial or commercial use; and (3) is not a covered product as defined in 42 U.S.C. 6291(a)(2). (42 U.S.C. 6311(2)(A))

On June 28, 2011, DOE published a notice of proposed determination of coverage that fans, blowers, and fume hoods qualify as covered equipment. 76 FR 37678 (“June 2011 NOPD”). DOE also proposed definitions for the terms “fan,” “blower,” and “fume hood.”

In the June 2011 NOPD, DOE preliminarily determined that coverage of fans, blowers, and fume hoods is necessary to carry out the purposes of Part A-1 because coverage will promote the conservation of energy supplies. 76 FR 37678, 37680. DOE estimated that technologies exist which can reduce the electricity consumption of fans and blowers by as much as 20 percent and that there are technologies and design strategies for fume hoods that could reduce energy by 50 percent. Id. DOE requested comment on the proposed definitions and its preliminary determination that coverage of fans, blower, and fume hoods is necessary to carry out the purposes of Part A-1. 76 FR 37678, 37682.

In parallel with the proposed determination rulemaking process, DOE published notice of a framework document that detailed an analytical approach for developing potential energy conservation standards for commercial and industrial fans and blowers should the Secretary classify such industrial equipment as covered equipment. 3 78 FR 7306 (February 1, 2013). The January 2013 Framework Document included revised definitions for “fan” and “blower.”

DOE also established a negotiated rulemaking working group under the Appliance Standards and Rulemaking Federal Advisory Committee to negotiate proposed definitions, test procedures and energy conservation standards for commercial and industrial fans and blowers. The Working Group held 16 meetings and three webinars and concluded its negotiations on September 3, 2015, with the approval of a term sheet containing recommendations for DOE. 4

On January 10, 2020, DOE received a petition from the Air Movement and Control Association (AMCA), International, Air Conditioning Contractors of America, and Sheet Metal & Air Conditioning Contractors of America requesting that DOE establish a Federal test procedure for certain categories of fans based on an upcoming industry test method, AMCA 214, Test Procedure for Calculating Fan Energy Index (FEI) for Commercial and Industrial Fans and Blowers. DOE published a notice of petition and request for public comment. 85 FR 22677 (April 23, 2020) (“April 2020 Notice of Petition”).

To date DOE has not classified commercial and industrial fans as covered equipment and has not proposed test procedures or energy conservation standards for this equipment.

Although EPCA lists fans and blowers as types of industrial equipment, these terms are not defined. As noted, DOE proposed definitions for “fan” and “blower” in the June 2011 NOPD. Specifically, DOE proposed the following definitions:

June 2011 NOPD, 76 FR 37678, 37679. Taking into consideration the comments received to the June 2011 NOPD, DOE considered the following definitions for “fan” and “blower” in the January 2013 Framework Document:

The industry test procedure referenced in AMCA's petition for a federal test procedure has since been finalized as ANSI/AMCA Standard 214-21, Test Procedure for Calculating Fan Energy Index (FEI) for Commercial and Industrial Fans and Blowers (“ANSI/AMCA Standard 214-21”). 5 The newly finalized industry test procedure contains the following definition for a fan: “a rotary-bladed machine used to convert electrical or mechanical power to air power, with an energy output limited to 25 kJ/kg of air. It consists of an impeller, shaft and bearings and/or driver to support the impeller as well as a structure or housing. A fan may include a transmission, driver and/or motor controller.”  6

DOE is considering establishing a definition of “commercial and industrial fan” that is identical to the definition of “fan” in ANSI/AMCA Standard 214-21. As discussed, DOE has initially determined that the terms “fan” and “blower” are used interchangeably. DOE is considering including the descriptor “commercial and industrial” with the term to clarify that the subject fans are industrial equipment and that the term excludes ceiling fans and furnace fans, both covered products defined at 10 CFR 430.2.

DOE notes that the maximum energy limit of 25 kJ/kg of air is equivalent to a pressure ratio of 1.3. 7 The current definition of a compressor at 10 CFR 431.342 states that, among other things, a compressor has a pressure ratio at full-load operating pressure greater than 1.3. As a result, DOE initially concludes that the maximum fan energy limit of 25 kJ/kg is appropriate to distinguish commercial and industrial fans from compressors.

With regard to the criterion that a commercial and industrial fan must convert “electrical and mechanical power into air power,” fans that are powered by an engine or any other driver would meet this criterion as the engine or other driver would be providing mechanical power that is converted into air power.

DOE requests comment on the definition of commercial and industrial fans as considered in this RFI. The definition being considered is identical to the definition of “fan” in ANSI/AMCA Standard 214-21. Specifically, DOE is requesting comment on whether this definition would accurately describe equipment generally understood as commercial and industrial fans.

DOE invites all interested parties to submit in writing by the date specified under the DATES heading, comments and information on matters addressed in this RFI for commercial and industrial fans. These comments and information will aid in the development of a final determination for commercial and industrial fans if DOE determines that a final determination is appropriate for this equipment.

Submitting comments via http://www.regulations.gov. The http://www.regulations.gov web page will require you to provide your name and contact information. Your contact information will be viewable to DOE Building Technologies staff only. Your contact information will not be publicly viewable except for your first and last names, organization name (if any), and submitter representative name (if any). If your comment is not processed properly because of technical difficulties, DOE will use this information to contact you. If DOE cannot read your comment due to technical difficulties and cannot contact you for clarification, DOE may not be able to consider your comment.

However, your contact information will be publicly viewable if you include it in the comment or in any documents attached to your comment. Any information that you do not want to be publicly viewable should not be included in your comment, nor in any document attached to your comment. Following this instruction, persons viewing comments will see only first and last names, organization names, correspondence containing comments, and any documents submitted with the comments.

Do not submit to http://www.regulations.gov information for which disclosure is restricted by statute, such as trade secrets and commercial or financial information (hereinafter referred to as Confidential Business Information (“CBI”)). Comments submitted through http://www.regulations.gov cannot be claimed as CBI. Comments received through the website will waive any CBI claims for the information submitted. For information on submitting CBI, see the Confidential Business Information section.

DOE processes submissions made through http://www.regulations.gov before posting. Normally, comments will be posted within a few days of being submitted. However, if large volumes of comments are being processed simultaneously, your comment may not be viewable for up to several weeks. Please keep the comment tracking number that http://www.regulations.gov provides after you have successfully uploaded your comment.

Submitting comments via email. Comments and documents submitted via email also will be posted to http://www.regulations.gov. If you do not want your personal contact information to be publicly viewable, do not include it in your comment or any accompanying documents. Instead, provide your contact information on a cover letter. Include your first and last names, email address, telephone number, and optional mailing address. The cover letter will not be publicly viewable as long as it does not include any comments.

Include contact information each time you submit comments, data, documents, and other information to DOE. Faxes will not be accepted.

Comments, data, and other information submitted to DOE electronically should be provided in PDF (preferred), Microsoft Word or Excel, WordPerfect, or text (ASCII) file format. Provide documents that are not secured, written in English and free of any defects or viruses. Documents should not contain special characters or any form of encryption and, if possible, they should carry the electronic signature of the author.

Campaign form letters. Please submit campaign form letters by the originating organization in batches of between 50 to 500 form letters per PDF or as one form letter with a list of supporters' names compiled into one or more PDFs. This reduces comment processing and posting time.

Confidential Business Information. According to 10 CFR 1004.11, any person submitting information that he or she believes to be confidential and exempt by law from public disclosure should submit via email two well-marked copies: one copy of the document marked confidential including all the information believed to be confidential, and one copy of the document marked “non-confidential” with the information believed to be confidential deleted. DOE will make its own determination about the confidential status of the information and treat it according to its determination.

It is DOE's policy that all comments may be included in the public docket, without change and as received, including any personal information provided in the comments (except information deemed to be exempt from public disclosure).

DOE considers public participation to be a very important part of the process for developing test procedures and energy conservation standards. DOE actively encourages the participation and interaction of the public during the comment period in each stage of this process. Interactions with and between members of the public provide a balanced discussion of the issues and assist DOE in the process. Anyone who wishes to be added to the DOE mailing list to receive future notices and information about this process should contact Appliance and Equipment Standards Program staff at (202) 287-1445 or via email at ApplianceStandardsQuestions@ee.doe.gov.

This document of the Department of Energy was signed on April 25, 2021 by Kelly Speakes-Backman, Principal Deputy Assistant Secretary and Acting Assistant Secretary for Energy Efficiency and Renewable Energy, pursuant to delegated authority from the Secretary of Energy. That document with the original signature and date is maintained by DOE. For administrative purposes only, and in compliance with requirements of the Office of the Federal Register, the undersigned DOE Federal Register Liaison Officer has been authorized to sign and submit the document in electronic format for publication, as an official document of the Department of Energy. This administrative process in no way alters the legal effect of this document upon publication in the Federal Register .

The Office of the Comptroller of the Currency (OCC), the Board of Governors of the Federal Reserve System (Board), and the Federal Deposit Insurance Corporation (FDIC) (collectively, the agencies) are inviting comment on a proposed rule (proposal) that would prescribe requirements for tax allocation agreements that involve insured depository institutions and OCC chartered uninsured institutions supervised by the agencies (collectively, institutions). 1 Under the proposal, institutions in a consolidated tax filing group (consolidated group  2 ) would be required to enter into tax allocation agreements with their holding companies and other members of the consolidated group that join in the filing of a consolidated group tax return. The proposal would establish a methodology for tax payment obligations between an institution and its parent holding company within a consolidated group and would address how the institution should be compensated for the use of its tax assets (such as net operating losses and tax credits). The proposal would be adopted primarily under Section 39 of the Federal Deposit Insurance Act (FDI Act)  3 and codified within the agencies' safety and soundness regulations. 4

The proposal would require institutions to include certain provisions in all tax allocation agreements, such as: The timing and amounts of any payments for taxes due to taxing authorities; the acknowledgment of an agency relationship between institutions and their holding companies in a consolidated group with respect to tax refunds received; and a provision stating that documents, including returns, relating to consolidated or combined federal, state, or local income tax filings must be made available to an institution or any successor during regular business hours. The proposal further addresses the regulatory reporting treatment of an institution's deferred tax assets (DTAs).

In 1998, the agencies and the Office of Thrift Supervision  5 adopted the Interagency Policy Statement on Income Tax Allocation in a Holding Company Structure  6 (Interagency Policy Statement) to provide guidance to insured depository institutions, their holding companies, and other affiliates regarding the allocation and payment of taxes when these entities file income tax returns on a consolidated basis. One of the principal goals of the Interagency Policy Statement is to clarify insured depository institutions' ownership rights in tax refunds when the consolidated group elects to file a consolidated tax return. The Interagency Policy Statement states that tax settlements between an insured depository institution and its holding company should be conducted in a manner that is no less favorable to the insured depository institution than if it were a separate taxpayer, and that whenever a holding company receives a tax refund from any taxing authority, and the refund is one that is attributable to its subsidiary insured depository institution, the holding company is acting purely as an agent for the insured depository institution.

In 2014, the agencies issued an addendum to the Interagency Policy Statement to emphasize that tax allocation agreements should expressly acknowledge an agency relationship between a holding company and its subsidiary insured depository institution to protect the insured depository institution's ownership rights in tax refunds (2014 Addendum). 7 The 2014 Addendum also clarifies that all tax allocation agreements are subject to section 23B of the Federal Reserve Act (section 23B). 8 In addition, the 2014 Addendum provides that tax allocation agreements that do not clearly acknowledge the presence of an agency relationship between the holding company and the subsidiary insured depository institution may be subject to requirements under section 23A of the Federal Reserve Act (section 23A). 9 Moreover, the 2014 Addendum clarifies that section 23B requires a holding company to transmit promptly to its subsidiary insured depository institution any tax refunds received from a taxing authority that are attributable to the insured depository institution. Sections 23A and 23B apply to institutions supervised by the agencies. 10

In their supervision of institutions, the agencies have observed that some institutions in consolidated groups either lack tax allocation agreements with their holding companies or have agreements that do not have language conforming with section 23A or 23B. In particular, the agencies have reviewed tax allocation agreements that do not require a holding company in a consolidated group to transmit promptly the appropriate portion of a consolidated group's tax refund to its subsidiary institution, resulting in the holding company failing to do so in some instances. Such inaction could adversely affect the safety and soundness of the subsidiary institutions because delayed access to funds could weaken an institution's liquidity profile. Further, in its capacity as receiver for failed insured depository institutions, the FDIC has engaged in legal disputes regarding the ownership of tax refunds claimed by holding companies based on losses incurred by insured depository institutions in a consolidated group because the tax allocation agreements did not clearly acknowledge an agency relationship between an insured depository institution and its holding company. These disputes can reduce or prevent recoveries by the FDIC on behalf of failed insured depository institutions, consequently increase costs to the Deposit Insurance Fund, and thus could lead to higher FDIC deposit insurance premiums charged to solvent insured depository institutions.

The proposal would apply to all institutions that file federal and state income taxes in a consolidated group in which one or more of the institutions in the consolidated group is supervised by any of the agencies. A consolidated group refers to an institution, its parent, and any affiliates of the institution that join in the filing of a tax return as a single consolidated, combined, or unitary group. While the Interagency Policy Statement and 2014 Addendum only apply to insured depository institutions, the OCC has observed similar problematic tax practices at uninsured institutions it supervises. Therefore, the OCC proposes to apply relevant provisions of the proposal to uninsured institutions as well.

In contrast, institutions that do not file federal and state income taxes as members of a consolidated group file separately and account for taxes on a separate entity basis. Therefore, an institution that files on a separate entity basis or in a group consisting solely of the institution and its subsidiaries would not be subject to the proposal. The proposal also would not apply to an institution if the institution or its holding company is not subject to corporate income taxes at either the federal or state level, such as those that have elected S-Corporation status and do not have an obligation to pay corporate income taxes. 11

Question [1]: Is the scope of application of the proposal appropriate, and what are the advantages and disadvantages of this scope?

As noted, a holding company and its bank subsidiaries have the ability to file a consolidated group income tax return. However, each depository institution is viewed as, and reports as, a separate legal and accounting entity for certain regulatory purposes, including for regulatory capital requirements. When a depository institution has subsidiaries of its own, the institution's applicable income taxes on a separate entity basis include the taxes of the subsidiaries of the institution itself that are included with the institution in the consolidated group return. Accordingly, each depository institution's applicable income taxes, reflecting either an expense or benefit, should be recorded in its books and records and reflected in the institution's regulatory reports as if the institution had filed on a separate entity basis. Throughout this notice, the terms “separate entity” and “separate taxpayer” are used synonymously. Furthermore, the amount and timing of payments or refunds should not be in any case less favorable to the institution than if the institution were a separate taxpayer. Any practice that is not consistent with this principle may be viewed as an unsafe or unsound practice.

The proposal would require that all institutions that are subject to Federal or State tax and file tax returns as part of a consolidated group execute a tax allocation agreement that applies to and binds each member of the consolidated group. The proposal also would require that the tax allocation agreement be approved by the boards of directors of an institution subject to that tax allocation agreement and its holding company to ensure the agreement's enforceability by and among the institutions in the consolidated group.

Section 23A and 23B generally govern extensions of credit and certain other transactions between institutions and their affiliates, which include their holding companies. Section 23A places quantitative limits on covered transactions between an institution and its affiliates and imposes collateral requirements on certain covered transactions. Section 23B requires that transactions between an institution and its affiliates be made on terms and under circumstances that are substantially the same, or at least as favorable to the institution, as comparable transactions involving nonaffiliated companies or, in the absence of the comparable transactions, on terms and circumstances that would in good faith be offered to nonaffiliated companies. The tax allocation agreement requirements in the proposal are intended to be consistent with sections 23A and 23B.

As mentioned above, one of the principles of the Interagency Policy Statement is that a tax allocation agreement cannot result in terms less favorable to an institution than if the institution filed its income tax return on a separate entity basis (that is, not as part of a consolidated group). To achieve this result, tax allocation agreements subject to the proposal would be required to establish certain rights and obligations among institutions in the consolidated group. Adjustments for statutory tax considerations that may arise on a consolidated tax return are permitted as long as the adjustments are made on a basis that is equitable and consistently applied among the holding company and other affiliates. Certain proposed key terms that would be required under the proposal for tax allocation agreements are explained below.

The proposal clarifies that, in terms of timing, an institution must be compensated for the use of its tax assets by the parent or other members of the consolidated group at the time the relevant tax asset is absorbed by the consolidated group. The proposal also clarifies that an institution must be promptly remitted any tax refund received (by the holding company) from a taxing authority that is based on the institution's tax attributes. 12 This is a common approach taken in tax sharing agreements, would promote safety and soundness by ensuring that an institution receives the benefit of its tax attributes, and is the approach least likely to create an extension of credit under section 23A.

Question [2]: While the agencies expect refunds would be transmitted to the institution as soon as possible, what are the advantages and disadvantages of the agencies requiring that an institution receive any tax refund based on its tax attributes within a specific timeframe from the date received? What would be an appropriate timeframe, and why?

Question [3]: What are the advantages and disadvantages of requiring that a parent or other members of a consolidated group compensate an institution for the use of its tax assets if and when the relevant tax asset is absorbed or used? How do these advantages and disadvantages compare to the advantages and disadvantages of other approaches including, for example, requiring that a parent or other members of the consolidated group compensate an institution for use of its tax assets if and when the institution would have been able to use the tax asset on a stand-alone basis?

As discussed in the preamble to the 2014 Addendum, there have been many legal disputes between holding companies and the FDIC, as receiver for failed insured depository institutions, regarding the ownership of tax refunds generated by the insured depository institutions. In reported decisions, some courts have found that tax refunds generated by an insured depository institution were the property of its holding company based on certain language contained in their tax allocation agreements that the courts have interpreted as creating a debtor-creditor relationship. 13 As a result, the FDIC's Deposit Insurance Fund has a material stake in the outcome of these legal disputes because they may lead to significant losses to creditors of the receiverships and, ultimately, the Deposit Insurance Fund. 14 Therefore, the agencies are proposing that holding companies receive refunds due to institutions (if attributable to the tax attributes of an institution) in trust and promptly remit them to the institutions for two reasons. First, an institution's prompt receipt of refunds that are based on the tax attributes created by that institution would allow management to direct those funds for the immediate benefit of the institution that owns them, rather than allowing them to be retained for the benefit of the holding company. Second, receipt of the refund by the institution strengthens the institution's liquidity profile as compared to a receivable from the holding company, and reduces the risk that a refund paid by the taxing authority to the holding company based on use of the institution's tax attributes would be diverted to the holding company's creditors or other affiliates.

Under the proposal, a group's tax allocation agreement must specify that an agency relationship exists between the institution and its holding company, including an affiliate of the institution that submits tax returns for the consolidated group with respect to tax refunds. The proposal would clarify that the subsidiary institution must enter into a tax allocation agreement that specifies that the institution owns any tax refund that is created from or results from its tax attributes. A group tax allocation agreement must state that the holding company receives any portion of the tax refund related to the subsidiary institution's tax attributes in trust for the benefit of the subsidiary institution, including, for example, when a holding company receives a tax refund for a consolidated group, and some or all of the tax refund is due to tax attributes  15 of a subsidiary institution. Further, under the proposal, the tax allocation agreement must provide that the holding company will remit the refund promptly to the subsidiary institution. Finally, to avoid any transactions that would prevent institutions from receiving tax refunds attributable to their tax attributes, the tax allocation agreement must provide that, notwithstanding any other transactions or agreements to the contrary, the institution must receive any tax refund attributable to its tax attributes. 16

The proposal also would address the timing and amount of tax payments  17 made to a holding company by an institution in a consolidated group. Specifically, the proposal would require an institution to be a party to a tax allocation agreement that prohibits tax payments by the institution to its affiliates in excess of the current period tax obligation of the institution calculated on a separate entity basis. This requirement would reduce the risk that the holding company would use the institution's funds to pay expenses or offset tax liabilities owed by the holding company or its other affiliates (other than the institution).

Remitting a current period tax expense payment to a holding company significantly in advance of when the payment would be due to the taxing authority if the institution filed on a stand-alone basis may treat the institution less favorably than if it were a separate taxpayer and, further, may be subject to section 23B. As a result, under the proposal, an institution must not remit its current period tax expense (or reasonably calculated estimated tax payment) earlier than when the institution would have been obligated to pay the taxing authority had it filed as a separate entity, based on the timeframes established by the taxing authority. Furthermore, the tax allocation agreement may permit the holding company to collect less than what the institution's current period income tax obligation would have been, calculated on a separate entity basis. Provided the parent will not later require the institution to pay the remainder of the current tax liability, the amount of this unremitted liability should be accounted for as having been paid with a simultaneous capital contribution by the parent to the subsidiary. With respect to deferred tax liabilities (DTLs), however, a parent cannot forgive some or all of the institution's DTL because the parent cannot legally relieve the subsidiary of a potential future obligation to the taxing authorities, especially if the subsidiary were to become a stand-alone entity. Furthermore, taxing authorities can collect some or all of a group's liability from any of the group members if tax payments are not made when due.

The proposal would address the timing and amount of tax payments and hypothetical refunds to be received by an institution in a consolidated group from its holding company. For example, in a situation whereby the institution, as a separate entity, has a net operating loss (NOL) and other members of the group have taxable income, the consolidated group must utilize the institution's tax loss to reduce the consolidated group's current tax liability because consolidated tax return rules require the holding company to utilize the NOLs of members of the group to reduce the group's taxable income and thus its current tax liability. 18 As a result, in this situation, the holding company must reimburse the institution for the current use of its tax losses at the time the NOL is used. The institution must reflect the tax benefit of the loss in the current portion of its applicable income taxes in the period the loss is incurred.

Separately, the proposal would require that an institution must receive from its holding company no less than the tax refund amount it would have received had it filed tax returns on a separate entity basis. For example, this would apply if the institution has a tax loss and would have been able to carry back that loss to a previous year and obtain a tax refund from a taxing authority had it filed income tax returns on a separate entity basis, but there is no ability to obtain an actual refund because other members in the consolidated group had losses that offset the institution's separate tax liability for the previous year(s). Similarly, if the institution makes quarterly tax payments, on an aggregate basis, in excess of its annual tax liability at year end and would obtain a tax refund had it filed on a separate entity basis, the proposal would require that the institution receive from the holding company no less than the tax refund amount the institution would have received as a separate entity from the taxing authority. Consistent with the principle that the amount and timing of tax payments within the consolidated group should be no less favorable to the institution than if it were a separate taxpayer, this proposed requirement would ensure that an institution receives the full benefit of its tax assets, such as any tax losses or tax credits it generates as a separate entity, instead of allowing those benefits to subsidize the activities of other affiliates, even if other affiliates in the consolidated group generate offsetting tax liabilities that reduce or eliminate a refund to the consolidated group. In this situation, the holding company would be required to remit the amount due to the institution within a reasonable period following the date the institution would have filed its own return on a separate entity basis. The prompt transmittal of funds from the holding company to the institution would permit management to use those funds for the benefit of the institution rather than of the holding company.

If a holding company were to fail to remit amounts or refunds owed to its subsidiary institution promptly, that inaction may be considered an extension of credit under section 23A. A holding company's failure to remit amounts or refunds owed to its subsidiary institution also could be viewed as a constructive dividend from the institution to the holding company, which would be subject to other requirements under applicable regulations of the agencies. 19

Under the proposal, a tax allocation agreement must require that all materials including, but not limited to, returns, supporting schedules, workpapers, correspondence, and other documents relating to the consolidated federal income tax return and any consolidated, combined, or unitary group state or local return, which return includes the institution, be made available on demand to the institution or any successor during regular business hours and that this requirement must survive any termination of the tax allocation agreement. Access to this information would permit the institution, as well as agency examiners, to evaluate compliance with the proposal, including whether the institution and holding company are appropriately calculating the institution's share of any tax liability and the institution's refund for use of its tax attributes. This proposed approach also is consistent with how the Internal Revenue Service views the relationship of members in a consolidated group with respect to tax documentation. 20

With respect to insured depository institutions that enter receivership, the FDIC as receiver would be successor to any rights or interests of the insured depository institution with respect to various agreements, including any tax allocation agreement and the ability to obtain tax return information for the consolidated group of which the insured depository institution is a member. 21 Requiring the holding company to provide access to tax returns to the consolidated group, including the insured depository institution, would benefit the FDIC as receiver by improving its ability to meet its tax obligations and obtain tax refunds that are due and owed to the failed insured depository institution in a timely manner.

Question [4]: What are the advantages and disadvantages of the proposed requirements for a tax allocation agreement between an institution and its affiliates? Are there other requirements that the agencies should consider prescribing?

Question [5]: To what extent is the proposal consistent with current industry practices? To the extent that the proposal differs from current practice, what are the advantages and disadvantages of the proposal, relative to current industry practices?

Regardless of whether an institution files as part of a consolidated group or as a separate entity, the institution must prepare its regulatory reports  22 on a separate entity basis, as specified in the current instructions for those reports. 23 The current instructions for the Consolidated Reports of Condition and Income (Call Reports) issued by the Federal Financial Institutions Examination Council require an institution that is a subsidiary of a holding company to calculate and report its current and deferred taxes on a separate entity basis. This existing reporting requirement would be unaffected by the proposal, which would establish a similar principle. The proposal would address transactions involving the purported purchase or sale of, or advancement of funds with respect to, an institution's DTAs and DTLs (collectively, “deferred tax items”). A DTA or DTL is an estimate of an expected future tax benefit more likely than not to be realized or an expected future tax obligation to be paid, respectively. Deferred tax items are generated by and are intrinsically, and often legally, tied to the activities, assets, and liabilities of the institution. DTAs and DTLs represent the future effects on income taxes that result from temporary differences and carryforwards that exist at the end of a period. 24 The agencies would propose to revise the Call Report instructions to incorporate the treatment for deferred tax items under the proposal, as described in the Paperwork Reduction Act section of the SUPPLEMENTARY INFORMATION .

Consistent with the separate entity basis reporting requirement, separating DTAs and DTLs from the associated assets or liabilities that gave rise to the deferred tax items would depart from one of the primary objectives related to accounting for income taxes, which is to recognize deferred tax items for the future tax consequences of events that have been recognized in an entity's financial statements or tax returns. 25 The relevant accounting standards specifically state that a temporary difference refers to a difference between the tax basis of an asset or liability and its reported amount in the financial statements that will result in taxable or deductible amounts in future years when the reported amount of the asset or liability is recovered or settled, respectively. 26 More specifically, DTAs are the deferred tax consequences attributable to deductible temporary differences and carryforwards, while DTLs are the deferred tax consequences attributable to taxable temporary differences. 27

Based on the description of deferred tax items in ASC paragraph 740-10-05-7 and the uncertainty over the actual amounts at which deferred tax items will be settled or realized in future periods, temporary difference deferred tax items should remain on the balance sheet as long as the associated assets or liabilities that give rise to those deferred tax items remain on the balance sheet. Accordingly, an institution's purchase, sale, or other transfer of deferred tax items arising from temporary differences is not acceptable under U.S. generally accepted accounting principles (GAAP) unless these items are transferred in connection with the transfer of the associated assets or liabilities. In the case of timing differences, it may be appropriate to transfer DTAs or DTLs resulting from a timing difference when the underlying asset or liability that created the future tax benefit or obligation is being purchased, sold, or transferred within the consolidated group. 28 In addition, when the DTA or DTL can be realized or is absorbed by the consolidated group in the current period tax return, it would be appropriate to settle or recover the DTA or DTL, respectively. 29 Therefore, as described in the Paperwork Reduction Act section of the SUPPLEMENTARY INFORMATION , the agencies plan to revise the Call Report instructions to clarify that transfers of temporary difference deferred tax items as described above are not consistent with GAAP.

Carryforwards are deductions or credits that cannot be utilized on the tax return during a year that may be carried forward to reduce taxable income or taxes payable in a future year. 30 Thus, in contrast to temporary differences, carryforwards do not arise directly from book-tax basis differences associated with particular assets or liabilities.

GAAP does not require a single allocation method for income taxes when members of a consolidated group issue separate financial statements. 31 The commonly applied “separate-return” method, which would reflect DTAs for NOLs and tax credit carryforwards on a separate return basis, would meet the relevant criteria. 32 Other systematic and rational methods that are consistent with the broad principles established by ASC 740 are also acceptable.

The FDI Act provides that the accounting principles applicable to reports or statements required to be filed with the agencies by insured depository institutions should result in reports of condition that accurately reflect the capital of such institutions, facilitate effective supervision of the institutions, and facilitate prompt corrective action to resolve the institutions at the least cost to the Deposit Insurance Fund. 33 The FDI Act also provides that, in general, the accounting principles applicable to Call Reports must be uniform and consistent with GAAP. 34 However, this section permits the agencies to adopt alternate accounting principles for regulatory reporting that are no less stringent than GAAP, if the agencies find that application of GAAP fails to meet any of the objectives stated above. 35

The agencies are aware of instances in which institutions have engaged in transactions with affiliates in a consolidated group to purchase, sell, or otherwise transfer deferred tax items, specifically DTAs, other than current period tax losses useable in the consolidated group's tax return for the current period, which would otherwise be NOL carryforward DTAs for the institution. The agencies' regulatory capital rule requires the deduction from common equity tier 1 capital of NOLs and tax credit carryforward DTAs, net of any related valuation allowances and net of DTLs. 36 Because of this treatment, an institution may attempt to derecognize its DTAs for NOLs or tax credit carryforwards on its separate-entity regulatory reports prior to the time when the carryforward benefits are absorbed by the consolidated group by selling or otherwise transferring these DTAs to affiliates, particularly affiliates not subject to the agencies' regulatory capital rule, potentially overstating capital. While an institution may receive cash from affiliates in exchange for these transfers, the transfer may be reversible and not provide the same quality of regulatory capital as cash in the form of a capital contribution from a holding company.

Second, there are significant valuation uncertainties associated with deferred tax items, particularly DTAs for NOLs or tax credit carryforwards, when the underlying tax attributes cannot be used or absorbed by the group in the current period. Even though deferred tax items are measured in accordance with the enacted tax rates expected to apply when these items are settled or realized, the actual amounts at which these items will be settled or realized will be determined using the tax rates in effect in the future periods when settlement or realization occurs. In cases where such transactions have been observed, the cash settlement for the deferred tax assets is based on tax rates at the time of the settlement between the entities. However, the actual tax benefit realized by the consolidated group may ultimately differ from that amount, depending upon tax rates at the time the relevant deferred tax asset is absorbed by the consolidated group. As a result, an institution that sells or purchases DTAs for NOLs or tax credit carryforwards may receive significantly less than, or overpay for, these DTAs in relation to the amounts at which these DTAs ultimately would have been realized had they not been transferred, which also raises concerns under section 23B to the extent that the insured depository institution is placed in a position less favorable than if it filed its income tax return on a separate entity basis. 37 For example, changes in federal tax laws, such as a change in the corporate income tax rate or provisions related to NOL carryback periods, can significantly affect the value of associated DTAs. 38

For these reasons, the agencies have concluded that the derecognition by insured depository institutions of DTAs for NOL or tax credit carryforwards on their separate-entity regulatory reports before the period in which they are absorbed by the consolidated group raises significant concerns and would not meet the objectives described in 12 U.S.C. 1831n(a)(1). 39 Specifically, the agencies find that derecognizing DTAs for NOLs or tax credit carryforwards in the Call Report in such circumstances may not accurately reflect an institution's capital and may increase the cost to the Deposit Insurance Fund if insured depository institutions that have engaged in these transactions subsequently fail after the DTAs were sold for less than their value, and the FDIC as receiver is unable to fully recover the value of these DTAs under applicable tax laws.

Consistent with this finding, as described in the Paperwork Reduction Act section of the SUPPLEMENTARY INFORMATION , the agencies expect to propose to revise the Call Report instructions to clarify that an institution must not derecognize DTAs for NOLs or tax credit carryforwards on its separate-entity regulatory reports prior to the time when such carryforwards are absorbed by the consolidated group.

The agencies would adopt the proposal under the procedures described in section 39 of the FDI Act. 40 The OCC would also adopt the proposal for uninsured institutions under its general rulemaking authority. 41 Guidelines or standards adopted under section 39 through a rulemaking are accorded special enforcement treatment under that statute. The agencies each have procedural rules that implement the enforcement remedies for guidelines prescribed by section 39. Under procedural provisions in these rules, each agency would be authorized to require an institution that intends to participate in a consolidated tax filing group and does not have an acceptable tax allocation agreement to develop a plan to implement an acceptable agreement consistent with the proposal or to be subject to enforcement actions.

Each agency proposes to incorporate the proposal as an appendix to its relevant safety and soundness rule (located in 12 CFR part 30 (OCC), 12 CFR part 208 (Board) and part 364 (FDIC)).

As of the most recent data, the agencies estimate that 2,604 supervised institutions (including 2,581 insured institutions and 23 uninsured OCC-chartered institutions) would be subject to the proposal. 42 Covered institutions must be part of a consolidated group and obligated to pay federal and state income taxes. These covered institutions represent 51 percent of all institutions supervised by the agencies, and they hold over 93 percent of total assets of all institutions supervised by the agencies. 43

The agencies do not have, nor are they aware of, data that indicates whether any particular institution files taxes as part of a consolidated group, whether the institutions have tax allocation agreements with their holding companies, or whether the institutions have agreements that would conform with the proposal. Therefore, it is difficult to accurately estimate the number of institutions that would be potentially affected by the proposal. However, in their supervision of institutions, the agencies have observed that only a small number of institutions in consolidated groups lack tax allocation agreements with their holding companies, have agreements that do not have language conforming with section 23A or 23B, or engage in transfers of DTAs or DTLs that are inconsistent with the separate entity basis reporting requirement. Overall, due to the fact that the agencies expect most covered institutions to already be in compliance with the proposal, the expected costs of the proposal are likely to be small.

The potential benefits and costs discussed below generally apply to the supervised institutions, their affiliates, and holding companies that are not already implementing principles from the existing non-codified guidance.

There are three key benefits of the proposal. First, in some situations, the proposal would strengthen the safety and soundness of covered insured and uninsured institutions by ensuring that consolidated tax filing arrangements and practices are not adverse to their interests. Second, in some circumstances, the proposal would reduce the FDIC's resolution-related costs for covered insured institutions. Third, under some circumstances, the proposal would result in institutions more accurately reflecting their common equity tier 1 capital. These issues are discussed in more detail below.

The proposal could strengthen the safety and soundness of covered institutions. In particular, to the extent that covered institutions, their affiliates, and holding companies are not already implementing principles from the existing non-codified guidance, it may be possible to transfer tax credits out of the institution to a parent or affiliate. In this situation, the transfer weakens the safety and soundness of the institution. The proposal would limit such transfers, increasing the safety and soundness of the covered institution.

The effect of the proposal on safety and soundness of all members of a consolidated group can be more nuanced. For example, when the parent or affiliate entity retains the transfers of tax credits out of the covered institution, the potential reduction of the safety and soundness of the covered institution may be accompanied by a corresponding increase in safety and soundness at the holding company or other affiliates.

To the extent there are covered institutions that currently engage in transactions involving NOL and tax credit carryforward DTAs within a consolidated group, the proposal could result in fewer transfers of such deferred tax items and the covered institutions may be more likely to receive equitable treatment. Furthermore, if the proposal were adopted, the covered institutions would retain access to the appropriate share of funds as they avoid being underpaid, or overpaying, in the course of the transactions related to deferred tax items.

By requiring a tax allocation agreement, and clear language in such agreements about an agency relationship, the proposal could reduce the cost of resolving failed insured depository institutions. In particular, to the extent that covered institutions, their affiliates, and holding companies are not already implementing principles from the existing non-codified guidance, it is possible to transfer tax credits out of the insured depository institution and into a parent or affiliate thereby reducing the value of the assets of the insured depository institution and raising the cost of resolving failed banks. Prompt receipt of tax refunds and appropriate timing and payment of tax obligations based on terms and provisions in a tax allocation agreement would, in some situations, result in the insured depository institution being better capitalized when entering receivership, and allow the FDIC to avoid litigation over the consolidated group's tax refunds and reduce uncertainties over any tax liabilities. By reducing the insured depository institution's failure resolution costs, including the related litigation and other procedural costs of resolution, the proposal would allow the FDIC to more efficiently resolve failed insured depository institutions, carry out its mission in a more cost-effective manner, and reduce future costs to the Deposit Insurance Fund.

As described in the Operating Loss and Tax Credit Carryforward DTAs section of the SUPPLEMENTARY INFORMATION , the agencies are aware of instances in which institutions have engaged in transactions with affiliates in a consolidated group to purchase, sell, or otherwise transfer deferred tax items, specifically DTAs, other than current period tax losses useable in the consolidated group's tax return for the current period, which would otherwise be NOL and tax credit carryforward DTAs for the covered institution. The proposal clarifies regulatory reporting requirements to help ensure that an institution recognizes all its individual deferred tax items, including those arising from temporary timing differences, in its regulatory reports. 44 An institution cannot report such items on its Call Reports separately from the asset or liability that gave rise to it, except under certain circumstances that are appropriate under GAAP. 45 The proposal also addresses accounting principles for regulatory reporting for institutions' transactions involving the purported purchase or sale of, or advancement of funds with respect to its NOLs and tax credit carryforward DTAs  46 to other affiliates in the consolidated group or the holding company. The agencies' regulatory capital rule requires the deduction from common equity tier 1 capital of NOL and tax credit carryforward DTAs, net of any related valuation allowances and net of DTLs. 47 Thus, by clarifying the regulatory reporting requirements, the proposal would more accurately reflect institutions' common equity tier 1 capital.

To the extent the supervised institutions, their affiliates, and holding companies are not already implementing principles from the existing non-codified guidance, there are two primary costs of the proposal. First, parent companies and affiliates of covered institutions could lose some discretion over the timing, magnitude, and direction of cash flows between members of the group. Second, there would be regulatory costs associated with preparing agreements as well as ongoing compliance or reporting expenses. These issues are discussed in more detail below.

Under the proposal, holding companies would be required to remit tax refunds to their subsidiary institutions, if the relevant subsidiary's tax assets such as net operating losses or tax credits generate the refund. Similarly, if the institution's tax assets allow the group to make smaller payments to a tax authority, the institution must be compensated at such time as when the consolidated group has benefitted from the use of its assets. The proposal would also enable institutions to avoid scenarios whereby they are required to submit tax payments to their holding company either materially before the holding company must remit taxes to the tax authority or greater than their actual obligations. The proposal could also result in certain holding companies ceasing to retain tax refunds and transmitting refunds to their subsidiary institutions, or no longer receiving funds well in advance of the obligated payment date.

Mandatory tax allocation agreements with terms outlined in the proposal would reduce discretion over the timing, magnitude, or direction of certain cash flows between members of the group. This may reduce the flexibility of the holding company to allocate funds between members of the consolidated group, potentially resulting in reduced growth or profitability.

To the extent the supervised institutions, their affiliates, and holding companies are not already implementing principles from the existing non-codified guidance, they could incur regulatory costs in order to enter into tax allocation agreements that comply with the requirements in the proposal. While these costs are uncertain, they are likely to be relatively small given that in the agencies' experience only a small number of institutions do not have a tax allocation agreement or, have a tax allocation agreement that does not conform with the proposal. Further, the Paperwork Reduction Act section of the Supplementary Information describes relatively small recordkeeping, reporting and disclosure costs associated with the proposal for covered entities.

Overall, due to the fact that the agencies expect most covered institutions to already be in compliance with the proposal, the expected costs are likely to be small. The proposal would increase the safety and soundness of institutions not implementing the principles in the Interagency Policy Statement and the 2014 Addendum and reduce litigation costs to the Deposit Insurance Fund.

Certain provisions of the proposal contain “collection of information” requirements within the meaning of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521) (PRA). In accordance with the requirements of the PRA, the agencies may not conduct or sponsor, and a 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 agencies will request new control numbers for this information collection. The information collection requirements contained in this proposal have been submitted to OMB for review and approval by the OCC and FDIC under section 3507(d) of the PRA (44 U.S.C. 3507(d)) and § 1320.11 of the OMB's implementing regulations (5 CFR part 1320). The Board reviewed the proposal under the authority delegated to the Board by OMB.

Comments are invited on:

a. Whether the collections of information are necessary for the proper performance of the agencies' functions, including whether the information has practical utility;

b. The accuracy or the estimate of the burden of the information collections, including the validity of the methodology and assumptions used;

c. Ways to enhance the quality, utility, and clarity of the information to be collected;

d. Ways to minimize the burden of the information collections on respondents, including through the use of automated collection techniques or other forms of information technology; and

e. Estimates of capital or startup costs and costs of operation, maintenance, and purchase of services to provide information.

All comments will become a matter of public record. Comments on aspects of this notice that may affect reporting, recordkeeping, or disclosure requirements and burden estimates should be sent to the addresses listed in the ADDRESSES section of this document. A copy of the comments may also be submitted to the OMB desk officer for the agencies by mail to U.S. Office of Management and Budget, 725 17th Street NW, #10235, Washington, DC 20503; facsimile to (202) 395-6974; or email to oira_submission@omb.eop.gov, Attention, Federal Banking Agency Desk Officer.

OMB control number: 1557-NEW.

Title of Information Collection: Recordkeeping Provisions Associated with the Interagency Guidelines on Safety and Soundness Standards for Tax Allocation Agreements.

Frequency: Event generated, annually.

Affected Public: National banks and federal savings associations.

Number of Respondents: 579.

Estimated average hours per response:

Recordkeeping Section 30 Appendix F Initial setup—20.

Recordkeeping Section 30 Appendix F Ongoing—1.

Estimated annual burden hours:

Recordkeeping Section 30 Appendix F Initial setup—11,580.

Recordkeeping Section 30 Appendix F Ongoing—579.

Total—12,159.

OMB control number: 7100-NEW.

Title of Information Collection: Recordkeeping Provisions Associated with the Interagency Guidelines on Safety and Soundness Standards for Tax Allocation Agreements.

Frequency: Event generated, annual.

Affected Public: State member banks.

Number of Respondents:  435.

Estimated average hours per response:

Recordkeeping Section 208 Appendix D-3 Initial setup—20.

Recordkeeping Section 208 Appendix D-3 Ongoing—1.

Estimated annual burden hours:

Recordkeeping Section 208 Appendix D-3 Initial setup—8,700.

Recordkeeping Section 208 Appendix D-3 Ongoing—435.

OMB control number: 3064-NEW.

Title of Information Collection: Recordkeeping Provisions Associated with the Interagency Guidelines on Safety and Soundness Standards for Tax Allocation Agreements.

Frequency: Event generated, annual.

Affected Public: State nonmember banks and state savings associations.

Estimated average hours per response:

Number of Respondents:  1,590.

Estimated average hours per response:

Recordkeeping Section 364 Appendix C Initial setup—20.

Recordkeeping Section 364 Appendix C Ongoing—1.

Estimated annual burden hours:

Recordkeeping Section 364 Appendix C Initial setup—31,800.

Recordkeeping Section 364 Appendix C Ongoing—1,590.

Current Actions: The proposal prescribes PRA recordkeeping requirements for tax allocation agreements that involve institutions supervised by the agencies. Each institution that is part of a consolidated group must enter into a written tax allocation agreement with its holding company. The respective boards of directors of each institution and its parent holding company must approve the tax allocation agreement.

In addition, the proposal would require changes to the instructions for the Call Reports (OMB No. 1557-0081 (OCC), 7100-0036 (Board), and 3064-0052 (FDIC)), which will be addressed in a separate Federal Register notice.

OCC: In general, the Regulatory Flexibility Act (RFA), 5 U.S.C. 601 et seq., requires an agency, in connection with a proposed rule, to prepare and make available for public comment an Initial Regulatory Flexibility Analysis describing the impact of the rule on small entities (defined by the Small Business Administration (SBA) for purposes of the RFA to include commercial banks and savings institutions with total assets of $600 million or less and trust companies with total assets of $41.5 million of less) or to certify that the proposed rule would not have a significant economic impact on a substantial number of small entities. The OCC currently supervises approximately 745 small entities, of which 281 may be within the scope of the proposed rule. The OCC classifies the economic impact on an individual small entity as significant if the total estimated impact in one year is greater than 5 percent of the small entity's total annual salaries and benefits or greater than 2.5 percent of the small entity's total non-interest expense. The OCC estimates the cost of implementing or revising the tax allocation agreements under the proposal would be less than $1,000 per institution and not result in a significant economic impact to these entities. Therefore, the OCC certifies that the proposal, if adopted as final, would not have a significant economic impact on a substantial number of small entities.

Board: The Board is providing an initial regulatory flexibility analysis with respect to this proposal. The Regulatory Flexibility Act, 5 U.S.C. 601 et seq. (RFA), requires an agency to consider whether the rules it proposes will have a significant economic impact on a substantial number of small entities. In connection with a proposed rule, the RFA requires an agency to prepare an Initial Regulatory Flexibility Analysis describing the impact of the rule on small entities or to certify that the proposed rule would not have a significant economic impact on a substantial number of small entities. An initial regulatory flexibility analysis must contain (1) a description of the reasons why action by the agency is being considered; (2) a succinct statement of the objectives of, and legal basis for, the proposed rule; (3) a description of, and, where feasible, an estimate of the number of small entities to which the proposed rule will apply; (4) a description of the projected reporting, recordkeeping, and other compliance requirements of the proposed rule, including an estimate of the classes of small entities that will be subject to the requirement and the type of professional skills necessary for preparation of the report or record; (5) an identification, to the extent practicable, of all relevant Federal rules which may duplicate, overlap with, or conflict with the proposed rule; and (6) a description of any significant alternatives to the proposed rule which accomplish its stated objectives.

The Board has considered the potential impact of the proposal on small entities in accordance with the RFA. Based on its analysis and for the reasons stated below, the proposal is not expected to have a significant economic impact on a substantial number of small entities. Nevertheless, the Board is publishing and inviting comment on this initial regulatory flexibility analysis. The Board will consider whether to conduct a final regulatory flexibility analysis after any comments received during the public comment period have been considered.

In their supervision of institutions, the agencies have observed that certain institutions in consolidated groups either lack tax allocation agreements with their holding companies or have agreements that fail to ensure that the institutions receive the benefit of their tax attributes, which could negatively impact the safety and soundness of these institutions. Although there is existing interagency guidance relating to tax allocation agreements, this guidance is nonbinding.

The proposal would codify and make enforceable (with certain modifications) earlier guidance documents relating to tax allocation agreements. The proposal is intended to (1) ensure that state member banks that file taxes as part of a consolidated group have tax allocation agreements in place, and (2) specify certain mandatory terms for such agreements. The proposal would also clarify that an institution must not derecognize DTAs for NOLs or tax credit carryforwards on its separate-entity regulatory reports prior to the time when such carryforwards are absorbed by the consolidated group.

The Board proposes to adopt the proposal pursuant to sections 39 and 37 of the FDI Act. 48 Section 39 of the FDI Act authorizes the Board to prescribe standards for safety and soundness by regulation or guideline. Section 37 of the FDI Act permits the Board to prescribe an accounting principle applicable to insured depository institutions that is no less stringent than generally accepted accounting principles. The guidelines promulgated under the proposal would be incorporated as an appendix to the Interagency Guidelines Establishing Standards for Safety and Soundness contained in 12 CFR part 208.

The proposal would apply to state member banks. According to Call Reports, there are approximately 455 state member banks that are small entities for purposes of the RFA. 49 213 of these entities are registered as Subchapter S corporations, would pay no tax at the business level, and therefore would not be impacted by the proposal. Additionally, the majority of potentially impacted small entities are likely already party to a tax allocation agreement, as discussed in existing guidance, and thus the number of small entities impacted by the proposal's requirements is likely to be considerably smaller.

The proposal would require state member banks to enter into tax allocation agreements containing certain specified terms. To the extent that institutions are not already party to compliant tax allocation agreements, they could incur administrative costs to enter into tax allocation agreements that comply with this proposal, or to modify existing tax allocation agreements to be compliant, which would require legal and accounting skills. It is likely that the majority of potentially impacted small entities are already party to a tax allocation agreement, as discussed in existing guidance. The majority of these agreements are likely either compliant with the proposal or could be made compliant with relatively minor modifications. Board staff estimates that impacted Board-supervised small entities will spend 20 hours establishing or modifying a tax allocation agreement, at an hourly cost of $115.00. 50 The estimated aggregate initial administrative costs of the proposal to Board-supervised small entities amount to $556,600.00, 51 and ongoing costs are expected to be small when measured by small banks' annual expenses. In addition, the proposal may also reduce existing flexibility around the timing of compensation from holding companies to state member banks for the use of their tax attributes. The Board does not anticipate any material impact on the overall tax liability of consolidated groups as a result of the proposal.

The Board has not identified any federal statutes or regulations that would duplicate, overlap, or conflict with the proposal. The Board has considered the alternative of maintaining or amending existing interagency guidance but considers the proposal to be a more appropriate alternative.

FDIC:

The RFA generally requires that, in connection with a proposed rulemaking, an agency prepare and make available for public comment an initial regulatory flexibility analysis describing the impact of the proposed rule on small entities. 52 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 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. 53 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 non-interest expenses. The FDIC believes that effects in excess of these thresholds typically represent significant effects for FDIC-supervised institutions. The FDIC does not believe that the proposed rule, if adopted, will have a significant economic effect on a substantial number of small entities. However, some expected effects of the proposed rule are difficult to assess or accurately quantify given current information, therefore the FDIC has included an Initial Regulatory Flexibility Act Analysis in this section.

As previously discussed, in its supervision of institutions, the FDIC has observed that some institutions and affiliated entities in consolidated groups lack tax allocation agreements with their holding companies, have agreements that do not have language conforming with section 23A or 23B, or engage in the sale or transfer of DTAs or DTLs with other entities in a consolidated tax filing group that is inconsistent with the separate entity basis reporting requirement. In particular, the FDIC has reviewed tax allocation agreements that do not require holding companies in a consolidated group to promptly transmit the appropriate portion of a consolidated group's tax refund to their subsidiary institutions, resulting in some holding companies failing to do so in some instances. The FDIC believes that such inaction could adversely affect the safety and soundness of the subsidiary institutions. Further, in its capacity as receiver for failed insured depository institutions, the FDIC has engaged in legal disputes regarding the ownership of tax refunds claimed by the holding company based on losses incurred by insured depository institutions in a consolidated group due to tax allocation agreements that did not clearly acknowledge an agency relationship between the insured depository institution and its holding company. These disputes can reduce or prevent recoveries by the FDIC on behalf of failed insured depository institutions, which increases the cost to the Deposit Insurance Fund and thus leads to higher FDIC deposit insurance premiums charged to solvent insured depository institutions.

The primary objective of the proposal is to further clarify the relationship between institutions supervised by the agencies (including insured depository institutions and uninsured institutions) and affiliates or parent holding companies who are in a consolidated tax filing group with respect to the treatment of tax obligations, tax refunds and related intra-group transactions. Tax allocation agreements between institutions and their holding companies and other affiliates are important safeguards to ensure compliance by institutions with sections 23A and 23B and certain other agency regulations that ensure that holding companies in a consolidated group promptly transmit the appropriate portion of a consolidated group's tax refund to their subsidiary institutions.

The FDIC proposes to adopt the guidelines pursuant to sections 39 and 37 of the FDI Act. 54 Section 39 prescribes different consequences depending on whether the agency issues regulations or guidelines. Under these provisions, an agency may require an institution that intends to participate in a consolidated tax filing group and does not have an acceptable tax allocation agreement to develop a plan to implement an acceptable agreement consistent with the proposal or to be subject to enforcement actions. Section 37(a) of the FDI Act states that the accounting principles applicable to reports or statements required to be filed with the agencies by institutions should result in reports of condition that accurately reflect the capital of such institutions, facilitate effective supervision of the institutions, and facilitate prompt corrective action to resolve the institutions at the least cost to the Deposit Insurance Fund. 55 For a more detailed discussion of the proposal's legal basis please refer to Section III entitled “Incorporation of the Guidelines as an Appendix to the Agencies' Safety and Soundness Rules”.

The FDIC proposes to incorporate the guidelines as an appendix to its safety and soundness rule in part 364. The FDIC has procedural rules in part 364 that implement the enforcement remedies prescribed by section 39. Under these provisions, the FDIC may require an institution that does not have an acceptable tax allocation agreement to develop a plan to implement an acceptable agreement consistent with the proposal or be subject to enforcement actions. 56 For a more detailed discussion of the proposal please refer to Section II entitled “Description of the Proposal” and Section III entitled “Incorporation of the Guidelines as an Appendix to the Agencies' Safety and Soundness Rules”.

As of the most recent data, the FDIC supervises 3,245 depository institutions of which 2,434 are “small” entities according to the terms of the RFA. Covered institutions must be part of a consolidated group, and subject to and obligated to pay federal and state income tax. The FDIC estimates that 1,008 small, FDIC-supervised institutions will be subject to the proposal. 57 These covered institutions represent 41 percent of all small institutions supervised by the FDIC, and they hold over 47 percent of total assets of all small institutions supervised by the FDIC. 58

As described in the Impact Analysis section of the SUPPLEMENTARY INFORMATION , it is difficult to accurately estimate the number of small FDIC-supervised institutions that would be potentially affected by the proposal. Specifically, the FDIC does not have data that indicates whether or not any particular small FDIC-supervised institution files taxes as a consolidated group, whether the small FDIC-supervised institutions have tax allocation agreements with their holding companies, or whether the institutions have agreements that do not have language conforming with section 23A or 23B. However, the FDIC believes that the number of small, FDIC-supervised depository institutions that will be directly affected by the proposal is likely to be small, given that in the agencies' supervisory experience only a small number of institutions do not currently have tax allocation agreements, have existing tax allocation agreements that do not have language conforming with section 23A or 23B, or engage in the sale or transfer of DTAs or DTLs with other entities in a consolidated tax filing group that is not consistent with the separate entity basis reporting requirement, notwithstanding the existing non-codified guidance.

The potential benefits and costs summarized below generally apply to the small FDIC-supervised institutions, their affiliates, and holding companies that are not already implementing principles from the existing non-codified guidance.

There are three key benefits of the proposal. First, in some situations, the proposal would strengthen the safety-and-soundness of covered small FDIC-supervised institutions by ensuring that consolidated tax filing arrangements and practices are not adverse to their interests. Second, in some circumstances, the proposal would reduce the FDIC's resolution-related costs. Third, under some circumstances, the proposal would result in small FDIC-supervised institutions more accurately reflecting their common equity tier 1 capital. These benefits are discussed in more detail in the Impact Analysis section of the SUPPLEMENTARY INFORMATION .

I. Policy Objectives

Section 18(a)(4) of the Federal Deposit Insurance Act, 12 U.S.C. 1828(a)(4), (Section 18(a)(4)) prohibits any person from misusing the name or logo of the Federal Deposit Insurance Corporation (FDIC) or from engaging in false advertising or making knowing misrepresentations about deposit insurance. The FDIC has observed an increasing number of instances where financial services providers or other entities or individuals have misused the FDIC's name or logo or have made false or misleading representations that would suggest to the public that these providers' products are FDIC-insured. To provide transparency into how the FDIC will address these and similar concerns, the FDIC is proposing to adopt regulations to further clarify its procedures for identifying, investigating, and where necessary taking formal and informal action to address potential violations of Section 18(a)(4). The regulations would also establish a point-of-contact for receiving complaints about potentially false or misleading representations regarding deposit insurance and would direct depositors and prospective depositors to where they could obtain information or verification about deposit insurance claims. Although the FDIC is not required to promulgate regulations to implement section 18(a)(4), the FDIC nonetheless believes that the proposed rule, if adopted, would establish a more transparent process that will benefit all parties and would promote stability and confidence in FDIC deposit insurance and the nation's financial system.

The FDIC has steadfastly and proactively sought to protect depositors and prospective depositors by limiting use of the FDIC's name, seal, and logo to insured depository institutions (IDIs) and preventing false and misleading representations about the manner and extent of FDIC deposit insurance (deposit insurance). Under Federal law, it is a criminal offense to misuse the FDIC name or make false representations regarding deposit insurance. 1 Moreover, the FDIC has independent authority to investigate and take administrative enforcement actions, including the power to issue cease and desist orders and impose civil money penalties, against any person who: (1) Falsely represents or implies that any deposit liability, obligation, certificate, or share is insured by the FDIC; or (2) otherwise knowingly misrepresents: (a) That any deposit liability, obligation, certificate, or share is insured, or (b) the extent or manner in which any deposit liability, obligation, certificate, or share is insured. 2

Although the FDIC has broad statutory authority in this area, the FDIC has never issued specific regulations regarding false representations related to FDIC insurance or the misuse of the FDIC's name or logo.

On February 26, 2020, the FDIC published in the Federal Register a Request for Information (RFI) related to potential modernization of its signage and advertising rules set out in part 328 of the FDIC regulations. 3 This RFI included the questions tied to the deposit insurance misrepresentation issues discussed in this Notice of Proposed Rulemaking. 4 On March 13, 2020, the FDIC published an extension of the comment period in the Federal Register . 5 However, on April 16, 2020, in light of COVID-19, the FDIC announced that it was temporarily postponing its efforts to modify the rules under part 328 of the FDIC regulations.

In light of the increasing number of instances where financial services providers or other entities or individuals have misused the FDIC's name or logo, the FDIC has elected to address false or misleading representation and misuse issues through this Notice of Proposed Rulemaking. Because the FDIC is committed to obtaining input on these issues from the industry and the public, we have included relevant questions in this document.

Separately, on April 9, 2021, the FDIC re-issued its RFI regarding the FDIC Sign and Official Advertising Requirements. 6 The 2021 RFI focuses on soliciting information on the modernization of the FDIC's advertising requirements applicable to IDIs, and related topics. While questions related to misrepresentation and misuse have been removed from that document, there remains a degree of overlap between the RFI and the proposed rule and responses to the RFI may provide information that is relevant to consideration of the proposed rule. For example, the RFI asks about how to deal with parties that may be fraudulently impersonating insured depository institutions, which necessarily overlaps with the proposed rule. Therefore, the FDIC will consider relevant comments submitted in response to the RFI, together with comments submitted in response to the proposed rule, in adopting the final rule.

The proposed regulation establishes a new subpart B to part 328, entitled “False Advertising, Misrepresentation of Insured Status, and Misuse of the FDIC's Name or Logo.” The proposed subpart sets forth the process by which the FDIC will identify and investigate conduct that may violate Section 18(a)(4), the standards under which such conduct will be evaluated, and the procedures which the FDIC will follow when formally and informally enforcing the provisions of Section 18(a)(4).

Section 328.100 notes that, unlike many FDIC regulations, which are binding upon IDIs and institution-affiliated parties (IAPs), this regulation, consistent with the authority set forth in Section 18(a)(4), will apply to any person who violates Section 18(a)(4) or who aids another in such a violation.

Section 328.101 sets forth certain definitions that will be used throughout the subpart. Such definitions include, but are not limited to the terms or phrases “non-deposit product,” “uninsured financial product,” “FDIC-associated images,” and “FDIC-associated terms.”

Section 328.102 sets forth the conduct that is prohibited by Section 18(a)(4). It further provides transparency by setting forth the FDIC's interpretation of the scope of prohibited conduct, including specific examples of conduct that the FDIC deems to violate Section 18(a)(4). The identified practices include instances where false statements are made regarding the existence or extent of deposit insurance associated with a product, as well as instances where material information is omitted from a representation ( e.g., where a non-bank third party represents that its products are FDIC-insured without identifying the name or the names of the IDIs where customer deposits will be placed and through whom such insurance is derived.) These examples are not meant to be an exhaustive list, but rather specific examples of the type of conduct that the FDIC has observed that violate the prohibitions in Section 18(a)(4). This list is not intended to be an exhaustive list, and the FDIC may modify the list based on responses to this notice or the RFI.

The section further sets forth certain standards that the FDIC will use to determine if a statement violates Section 18(a)(4). The standards laid out in § 328.102 are adapted from the standards that Federal Trade Commission developed decades ago to determine if acts or practices are deceptive in violation of Section 5 of the Federal Trade Commission Act, 15 U.S.C. 45 (Section 5). 7 While Section 18(a)(4) is separate from Section 5, it prohibits similar conduct—deception in connection with commerce. The standards governing deception under Section 5 have been consistently accepted by courts, 8 and used by the FTC and other agencies, including the FDIC, which enforces prohibitions of Section 5 against the institutions it supervises and IAPs of those institutions. 9 In light of the long-term use and acceptance of these standards, the FDIC believes it is appropriate to use similar standards to determine if a representation about deposit insurance violates Section 18(a)(4).

Section 328.102 also sets forth a bright-line rule for when the FDIC will presume a misrepresentation to have been knowingly made ( i.e., when a respondent continues to make representations about deposit insurance after having been advised by a governmental or regulatory authority that such representations are false or misleading). This bright-line rule is not, however, intended to be the exclusive manner in which the FDIC can establish that any misrepresentation was knowingly made, and the agency reserves the right to establish this statutory element by introducing other evidence.

Section 328.103 provides a process by which members of the public may submit complaints to the FDIC regarding suspected false or misleading representations about deposit insurance. It also directs members of the public to the agency's existing resources to submit inquiries about representations regarding deposit insurance to the FDIC's Information and Support Center.

The FDIC believes that having a specified point-of-contact for depositors and prospective depositors who may have questions about deposit insurance coverage will be of particular value to the public given the increasing volume of communication and advertising relating to financial products that members of the public receive over various media, including social media and electronic communication. This process represents a continuation of the Information and Support Center's role of aiding the FDIC's mission of ensuring and promoting the stability and confidence of the banking system by responding to inquiries from the public.

Section 328.104 sets forth procedures for formal investigations into potential violations of Section 18(a)(4). Among other things, the section delegates authority to the FDIC's General Counsel to investigate potential violations and provides that such investigations will be conducted in accordance with section 10(c) of the Federal Deposit Insurance Act  10 and the FDIC's rules governing investigations, which are found in subpart K of the FDIC's Rules of Practice and Procedure. 11 Section 328.104 further provides that, notwithstanding the longstanding confidentiality provisions found in 12 CFR 308.147, in those limited circumstances where there is risk of imminent harm to consumers or depositors, the FDIC may disclose the existence of an investigation under this part that does not involve a bank or a known IAP of a bank. This disclosure authorization, which is a departure from the general practice of maintaining the confidentiality of investigations, is intended to further the FDIC's mission of promoting confidence and stability in the banking system by allowing it to disclose investigations into potentially false or misleading representations about deposit insurance where there is a risk of imminent harm to consumers or depositors.

Section 328.105 sets forth circumstances under which the FDIC may notify other authorities of potential violations of law that it becomes aware of in connection with a complaint, inquiry, investigation or action under this subpart.

Section 328.105 provides that the FDIC may recommend that another appropriate Federal banking agency take action to enforce Section 18(a)(4) against an IDI that is subject to the authority of that appropriate Federal banking agency or an IAP of such an institution. Such recommendations are authorized by Section 18(a)(4), which also provides that if the appropriate Federal banking agency fails to take action within 30 days, the FDIC may take enforcement action.

Section 328.105 further provides that, in the event the FDIC becomes aware of conduct that potentially violates laws or regulations within the jurisdiction of another regulatory authority, the FDIC may take steps to notify the appropriate authority.

Section 328.105 also provides that, in the event the FDIC becomes aware of conduct that potentially constitutes a criminal violation of 18 U.S.C. 709, the FDIC may, in appropriate circumstances, notify the FDIC Office of the Inspector General or the appropriate criminal law authority.

Finally, § 328.105 contains provisions governing the provision of any records to other regulatory or criminal authorities in connection with notice under the section.

Historically, the FDIC has generally resolved apparent violations of Section 18(a)(4) informally by notifying the party responsible and requesting that the apparent false or misleading representation be withdrawn and corrected. Section 328.106 sets forth the process the FDIC will follow when pursuing an informal resolution. Under this process, the FDIC will generally send any person that appears to be making a false or misleading representation, or any person aiding or abetting such a representation, an advisory letter notifying the person of the basis for the FDIC's concerns and requesting corrective action. Such letters will also provide the recipient the opportunity to provide the FDIC with supplemental information if the recipient contends that the representations made are true and not misleading and/or that any use of the FDIC's name or logo is authorized.

Examples of the general form such advisory letters may take may be found on the FDIC's public website at https://www.fdic.gov/regulations/laws/federal/2021/template-advisory-letters.pdf. Form A-1 provides a template advisory letter for communicating directly with a person that is believed to be misusing the FDIC's name or logo or making false or misleading representations about deposit insurance. Form A-2 provides a template advisory letter for communications directed to a third-party publisher that may be disseminating potentially false or misleading representations regarding deposit insurance. Form A-3 provides a template for communications with internet service providers (ISPs), alerting them that a website hosted by the ISP may be making false representations in violation of Section 18(a)(4).

Generally, the FDIC will only send such advisory letters to an ISP if the website in question contains one or more indicia of fraud. Such indicia would include, among other things, evidence that: (1) The website purports to belong to or be associated with an IDI when the IDI disclaims any ownership or association with the website; (2) the website appears to mirror or look like a valid website maintained by an IDI by spoofing or copying photos or pages from the IDI's website in an attempt to deceive depositors into believing that the website belongs to or is associated with the IDI; (3) the website purports to belong to an IDI, when no such IDI exists; or (4) there are geographic or other inconsistencies on the site ( e.g., the website is hosted abroad or the contact information reflected on the site does not match those on file with the FDIC).

Section 328.106 further provides that if the recipient of such a letter takes the requested corrective action within the time requested, the FDIC will generally take no further action. However, if the recipient fails to timely take corrective action, the FDIC may pursue all remedies available to it. Additionally, pursuant to § 328.106, the FDIC may commence formal enforcement action at any time if the FDIC has reason to believe that depositors or IDIs may suffer harm as a result of continued conduct or if the person making the false or misleading representation has been previously advised of the agency's concerns.

Section 328.107 sets forth the procedures that will govern any formal enforcement action brought by the FDIC to enforce the provisions of Section 18(a)(4). Under § 328.107, and as authorized by Section 18(a)(4), the FDIC may bring formal actions to enforce Section 18(a)(4) under section 8 of the Federal Deposit Insurance Act (Section 8)  12 against any person in the same manner and to the same extent that it can bring such actions against insured state nonmember banks and their IAPs.

Section 328.107 authorizes the FDIC General Counsel to bring an action against any person to enforce the provisions of Section 18(a)(4); however, it provides that in the case of an IDI for which another Federal banking agency is the appropriate Federal banking agency, the General Counsel can only commence an action if the appropriate Federal banking agency fails to take action after receiving a recommendation pursuant to § 328.105. It further provides that administrative proceedings brought to enforce Section 18(a)(4) will be governed by the FDIC's Rules of Practice and Procedure set forth in Part 308 of the FDIC's Regulations.

Section 328.107 also sets forth the venue for formal enforcement actions. In the case of actions against IDIs or IAPs, venue will be in the federal judicial district where the home office of the IDI is located. This is consistent with the venue provisions of Section 8. In actions that do not involve IDIs or IAPs, venue will be based on the residence of the respondent, similar to the manner in which venue is determined for general civil actions under 29 U.S.C 1391. The FDIC believes these venue provisions are consistent with existing law and due process.

Section 328.108 clarifies that any order issued after hearings conducted pursuant to this subpart is subject to judicial review to the same extent as any other order issued under Section 8. While Section 18(a)(4) does not expressly provide for judicial review, it does authorize enforcement actions under Section 8, which provides for such review. The FDIC believes that this grant of authority includes the right to seek judicial review and further believes such right is necessary and appropriate. Section 328.108 also provides that any petitions for judicial review may be filed in the court of appeals for the federal circuit where the hearing was held or the United States Court of Appeals for the District of Columbia Circuit. This venue provision is consistent with the venue provisions of Section 8 and provides respondents with the same choice of venue provided after any other FDIC enforcement hearing.

The proposed rule, if adopted, would primarily affect non-bank entities and individuals who are potentially misusing the FDIC's name or logo or are making false or misleading representations about deposit insurance. The FDIC currently insures 5,042 depository institutions  13 that could also be affected; however in practice, the proposed rule would primarily affect non-bank entities and private individuals. Since the adoption of Section 18(a)(4) in 2008, the FDIC has issued only one formal enforcement order against a non-bank entity for misuse of the FDIC's name or logo or for misrepresentations or false advertising in relation to deposit insurance. However, as previously noted the FDIC has observed a recent increase in the number of instances where financial services providers or other entities or individuals have misused the FDIC's name or logo or have made misrepresentations that would falsely suggest to the public that these providers' products are FDIC-insured and been subject to an informal resolution. Between January 1, 2019, and December 31, 2020, the FDIC has worked with non-bank entities to reach informal resolutions regarding the potential misuse of the FDIC's name or logo and/or misrepresentations relation to deposit insurance in at least 165 instances. 14 Based on this experience, the FDIC estimates that the proposed rule, if adopted, would apply to relatively few formal enforcement actions and conservatively estimates that it would affect fewer than 165 informal resolutions with non-bank entities and individuals each year.

As discussed previously, the proposed rule, if adopted, would clarify the FDIC's procedures for evaluating potential violations of Section 18(a)(4). The proposed rule would generally be consistent with existing practices used by the FDIC with respect to these matters. Further the proposed rule, if adopted, would not affect the application of related criminal prohibitions under 18 U.S.C. 709. Therefore, the FDIC believes that the proposed rule, if adopted, would be unlikely to have any significant effect on formal and informal enforcement of the Section 18(a)(4) prohibitions.

The FDIC believes that the proposed rule, if adopted, would benefit FDIC-insured institutions and members of the public by further clarifying what constitutes a violation of Section 18(a)(4), by creating a process by which institutions and members of the public can report suspected instances of false advertising, misuse, or misrepresentation regarding deposit insurance, and by establishing clear procedures by which the FDIC will investigate and, where necessary, formally and informally resolve potential violations of Section 18(a)(4). Specifically, the added transparency on the FDIC's processes for investigating potential instances of misuse or misrepresentation and, if needed, resolution are expected to benefit the parties involved by establishing a common understanding of those processes.

The FDIC has considered alternatives to the rule but believes that adopting subpart B to part 328 represents the most appropriate option. As discussed previously, Section 18(a)(4) establishes prohibitions against the misuse of the FDIC's name or logo and prohibits misrepresentations and false advertising in relation to deposit insurance. The FDIC considered the status quo alternative of not adopting a regulation that further clarifies what constitutes misuse of FDIC name or logo or false or misleading representation with respect to FDIC insurance, how the FDIC will identify and investigate suspected instances of misuse or misrepresentation, and the process by which the FDIC will pursue formal or informal resolution of instances of misuse or misrepresentation. However, based on the FDIC's recent experience addressing instances of potential and actual misuse, misrepresentation, and false advertising in relation to the FDIC name and logo, the FDIC believes that the proposed rule is the most appropriate action.

The FDIC invites comments on all aspects of this proposed rulemaking. In particular, the FDIC seeks feedback on the scope of the proposed rule and the procedures described therein, including the following specific questions:

1. Please describe the extent to which the proposed rule sufficiently identifies situations that present potential risks related to false or misleading representations regarding deposit insurance coverage and the misuse of the FDIC's name or logo, including those related to specific products and advertising channels. If there are additional types of false or misleading representations about deposit insurance coverage that may not be effectively captured by the rule, please describe them.

2. Please describe the extent to which the proposed rule sufficiently addresses false or misleading representations regarding deposit insurance and the misuse of the FDIC's name and logo. If there are additional or alternative ways to more effectively or efficiently address such misrepresentations and/or misuse, please describe them.

3. Please describe any suggested additions to the proposed rule for preventing and addressing the risks of false or misleading representations regarding deposit insurance and/or the misuse of the FDIC's name and logo.

4. Are the proposed complaint and inquiry procedures sufficiently clear about how business entities and members of the public may contact the FDIC if they have questions or concerns relating to potentially false or misleading representations regarding deposit insurance or misuse of the FDIC's name and logo? Are there other types of procedures the FDIC should consider? If so, please describe them.

5. Are there other alternative, effective, and efficient methods by which a customer can ensure that a third-party's representations regarding deposit insurance are true and accurate? If so, please describe them.

6. Is the proposed informal resolution process an adequate means of addressing, in the first instance in most circumstances, potentially false or misleading representations regarding deposit insurance or misuse of the FDIC's name and logo? Should the FDIC consider other or additional procedures? If so, please describe them.

7. The proposed rule contains a provision that would permit the FDIC, in those limited circumstances where there is risk of imminent harm to consumers or depositors, to confirm the existence of a formal investigation, so long as the target of the investigation was not an IDI or a known IAP thereof. This provision would be an exception to the longstanding confidentiality provisions found in 12 CFR 308.147. Is such an exception appropriate? Does the proposed rule strike an appropriate balance between the need to maintain the confidentiality of investigations involving IDIs and known IAPs, versus the potential value in identifying the existence of investigations into non-bank persons and entities whose conduct may result in risk of imminent harm to consumers and depositors? Are there alternatives the FDIC should consider? If so, please describe them.

8. Is the formal enforcement action process sufficiently clear, given that Section 18(a)(4) expressly references the use of established enforcement mechanisms set forth in Section 8 of the FDI Act? Should other provisions be added? If so, please describe them.

9. Do the investigation, informal resolution, and formal enforcement action processes described in the proposed rule strike the appropriate balance between addressing in a timely manner potentially false or misleading representations regarding deposit insurance and allowing the parties identified as potentially participating in the false or misleading representations an opportunity to present additional facts or provide a legal defense?

10. Upon entering into a relationship or arrangement with a third-party non-bank entity, as part of FDIC-insured institutions' due diligence, do such institutions currently take steps to ensure: (a) That the non-bank is aware of existing laws and regulations related to the use of the FDIC's name and logo, and (b) that representations made by the non-bank regarding the insured status of bank products are accurate and comply with existing laws and regulations? If not, are there practices that FDIC-insured institutions could adopt to spread awareness of and compliance with these laws and regulations by non-banks?

11. Are there other topics or issues relating to false or misleading representations regarding deposit insurance or the misuse of the FDIC's name and logo that the FDIC should consider? If so, please describe them and how you think the FDIC should address those topics and issues.

Written comments must be received by the FDIC no later than July 9, 2021.

The Regulatory Flexibility Act (RFA), requires that, in connection with a notice of proposed rulemaking, an agency prepare and make available for public comment an initial regulatory flexibility analysis that describes the impact of the proposed rule on small entities. 15 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, and publishes its certification and a short explanatory statement in the Federal Register together with the rule. The Small Business Administration (SBA) has defined “small entities” to include banking organizations with total assets of less than or equal to $600 million. 16 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. For the reasons provided below, the FDIC certifies that the proposed rule, if adopted in final form, would not have a significant economic impact on a substantial number of small banking organizations. Accordingly, a regulatory flexibility analysis is not required.

As of September 30, 2020, the FDIC insured 5,042 depository institutions, of which 3,585 are considered small banking organizations for the purposes of RFA. 17 Potential instances of misuse or misrepresentation of the FDIC name or logo by IDIs are usually addressed under the normal supervisory authority of the appropriate federal financial regulator, therefore although the proposed rule could affect IDIs, in practice the proposed rule would primarily affect non-bank entities and private individuals. Private individuals are not considered “small entities” by the terms of the RFA. 18

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 RFA section. In particular, would this rule have any significant effects on small entities that the FDIC has not identified?

Section 722 of the Gramm-Leach-Bliley Act  19 requires the federal banking agencies to use plain language in all proposed and final rules published after January 1, 2000. 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.

Under section 2222 of the Economic Growth and Regulatory Paperwork Reduction Act of 1996 (EGRPRA), the FDIC is required to review all of its regulations, at least once every 10 years, in order to identify any outdated or otherwise unnecessary regulations imposed on insured institutions. 20

Pursuant to section 302(a) of the Riegle Community Development and Regulatory Improvement Act (RCDRIA), 21 in determining the effective date and administrative compliance requirements for new regulations that impose additional reporting, disclosure, or other requirements on IDIs, each Federal banking agency must consider, consistent with principles of safety and soundness and the public interest, any administrative burdens that the regulations would place on depository institutions, including small depository institutions, and customers of depository institutions, as well as the benefits of the regulations. In addition, section 302(b) of RCDRIA requires new regulations and amendments to regulations that impose additional reporting, disclosures, or other new requirements on IDIs generally to 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. 22 The FDIC invites comments that further will inform its consideration of RCDRIA.

For the reasons stated in the preamble, the Federal Deposit Insurance Corporation proposes to amend 12 CFR part 328 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 ADDRESSES . Include “Docket No. FAA-2021-0338; Project Identifier AD-2020-01423-T” at the beginning of your comments. The most helpful comments reference a specific portion of the proposal, explain the reason for any recommended change, and include supporting data. The FAA will consider all comments received by the closing date and may amend the proposal because of those comments.

Except for Confidential Business Information (CBI) as described in the following paragraph, and other information as described in 14 CFR 11.35, the FAA will post all comments we receive, without change, to https://www.regulations.gov, including any personal information you provide. The agency will also post a report summarizing each substantive verbal contact we receive about this proposed AD.

CBI is commercial or financial information that is both customarily and actually treated as private by its owner. Under the Freedom of Information Act (FOIA) (5 U.S.C. 552), CBI is exempt from public disclosure. If your comments responsive to this NPRM contain commercial or financial information that is customarily treated as private, that you actually treat as private, and that is relevant or responsive to this NPRM, it is important that you clearly designate the submitted comments as CBI. Please mark each page of your submission containing CBI as “PROPIN.” The FAA will treat such marked submissions as confidential under the FOIA, and they will not be placed in the public docket of this NPRM. Submissions containing CBI should be sent to Greg Rutar, Aerospace Engineer, Airframe Section, FAA, Seattle ACO Branch, 2200 South 216th St., Des Moines, WA 98198; phone and fax: 206 231 3529; email: Greg.Rutar@faa.gov. Any commentary that the FAA receives which is not specifically designated as CBI will be placed in the public docket for this rulemaking.

The FAA has received reports indicating that shimming requirements were not met during the assembly of certain AWWB structural joints, which can result in reduced fatigue thresholds and cracking of the affected structural joints. The existing inspection program does not adequately detect this fatigue cracking. The affected locations are the forward edge of the AWWB side fitting and failsafe strap at STA 1209 on the left and right side, and the AWWB side fitting outer chord surface and failsafe strap; and the forward edge of the horizontal flange of the AWWB body chord and around all the fastener heads and vertical beam clips common to the AWWB body chord horizontal flange. Not meeting the shimming requirements during assembly of the STA 1209 AWWB side fitting and body chord structural joints results in excessive pull-up forces, fastener shanking, excessive burr heights in metallic members, and metallic chips (foreign object debris) in fastened interfaces, which all degrade fatigue performance of any affected structural joints.

Undetected fatigue cracking could weaken primary structure so it cannot sustain limit load, which could result in reduced structural integrity of the airplane.

The FAA reviewed Boeing Alert Requirements Bulletin B787-81205-SB530077-00 RB, Issue 001, dated September 8, 2020. The service information describes procedures for repetitive high frequency eddy current (HFEC) inspections for cracking of the forward edge of the AWWB side fitting and failsafe strap at station (STA) 1209 on the left and right side, and the AWWB side fitting outer chord surface and failsafe strap, and repair of any cracking found.

The FAA reviewed Boeing Alert Requirement Bulletin B787-81205-SB530078-00 RB, Issue 001, dated September 8, 2020. The service information describes procedures for repetitive HFEC inspections for cracking of the forward edge of the horizontal flange of the AWWB body chord and around all the fastener heads and vertical beam clips common to the AWWB body chord horizontal flange.

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 the agency 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 accomplishment of the actions identified in Boeing Alert Requirements Bulletins B787-81205-SB530077-00 RB and B787-81205-SB530078-00 RB, both Issue 001, both dated September 8, 2020, except for any differences identified as exceptions in the regulatory text of this proposed AD.

For information on the procedures and compliance times, see this service information at https://www.regulations.gov by searching for and locating Docket No. FAA-2021-0338.

The FAA worked in conjunction with industry, under the Airworthiness Directive Implementation Aviation Rulemaking Committee (AD ARC), to enhance the AD system. One enhancement is a process for annotating which steps in the service information are “required for compliance” (RC) with an AD. Boeing has implemented this RC concept into Boeing service bulletins.

In an effort to further improve the quality of ADs and AD-related Boeing service information, a joint process improvement initiative was worked between the FAA and Boeing. The initiative resulted in the development of a new process in which the service information more clearly identifies the actions needed to address the unsafe condition in the “Accomplishment Instructions.” The new process results in a Boeing Requirements Bulletin, which contains only the actions needed to address the unsafe condition ( i.e., only the RC actions).

The FAA estimates that this proposed AD affects 79 airplanes of U.S. registry. The FAA estimates the following costs to comply with this proposed AD:

The FAA has received no definitive data on which to base the cost estimates for the on-condition repairs specified in this proposed AD.

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

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.

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) Would not affect intrastate aviation in Alaska, and

(3) Would 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 ADDRESSES . Include “Docket No. FAA-2021-0348; Project Identifier 2018-SW-076-AD” at the beginning of your comments. The most helpful comments reference a specific portion of the proposal, explain the reason for any recommended change, and include supporting data. The FAA will consider all comments received by the closing date and may amend this proposal because of those comments.

Except for Confidential Business Information (CBI) as described in the following paragraph, and other information as described in 14 CFR 11.35, the FAA will post all comments received, without change, to https://www.regulations.gov, including any personal information you provide. The agency will also post a report summarizing each substantive verbal contact received about this proposal.

CBI is commercial or financial information that is both customarily and actually treated as private by its owner. Under the Freedom of Information Act (FOIA) (5 U.S.C. 552), CBI is exempt from public disclosure. If your comments responsive to this NPRM contain commercial or financial information that is customarily treated as private, that you actually treat as private, and that is relevant or responsive to this NPRM, it is important that you clearly designate the submitted comments as CBI. Please mark each page of your submission containing CBI as “PROPIN.” The FAA will treat such marked submissions as confidential under the FOIA, and they will not be placed in the public docket of this NPRM. Submissions containing CBI should be sent to, Matt Fuller, AD Program Manager, Operational Safety Branch, Airworthiness Products Section, General Aviation & Rotorcraft Unit, FAA, 10101 Hillwood Pkwy., Fort Worth, TX 76177; telephone (817) 222-5110; email Matthew.Fuller@faa.gov. Any commentary that the FAA receives which is not specifically designated as CBI will be placed in the public docket for this rulemaking.

The FAA issued Emergency AD 2011-18-52 on August 25, 2011, which was published as a Final rule; request for comments, on April 18, 2012 (77 FR 23109) (AD 2011-18-52). AD 2011-18-52 applies to Agusta S.p.A. (now Leonardo S.p.a.) Model AB139 and AW139 helicopters with a T/R blade part number (P/N) 3G6410A00131 or P/N 4G6410A00131 installed. AD 2011-18-52 requires, within 5 hours time-in-service (TIS), establishing a life limit of 600 hours TIS or 1,500 takeoff and landing cycles (cycles), whichever occurs first, on the affected T/R blades and updating the helicopter's historical records. If a T/R blade's total number of cycles is unknown, determining the T/R blade cycles by multiplying the T/R blade's hours TIS by 4 is required. For a T/R blade that, on the effective date of the AD, has already exceeded 600 hours TIS or 1,500 cycles, the AD requires replacing the T/R blade with an airworthy T/R blade within 5 hours TIS.

AD 2011-18-52 also requires, within 25 hours TIS, and thereafter at intervals not to exceed 25 hours TIS, inspecting the T/R blade for a crack or damage that exceeds the limits of the applicable maintenance manual. The inspection must be accomplished using a mirror, magnifying glass (5X or greater), and light source; or borescope. If there is a crack, or if there is damage that exceeds the limits of the applicable maintenance manual, AD 2011-18-52 requires, before further flight, replacing the T/R blade with an airworthy T/R blade.

AD 2011-18-52 was prompted by a fatal accident involving an Agusta Model AW139 helicopter, which may have been caused by cracks in a T/R blade. EASA, which is the Technical Agent for the Member States of the European Union, issued EASA Emergency AD 2011-0156-E, dated August 25, 2011 (EASA AD 2011-0156-E) to require repetitive inspections and reducing the life limit of the T/R blades. According to EASA, this condition, if not detected and corrected, could result in failure of a T/R blade and subsequent loss of control of the helicopter.

Since the FAA issued AD 2011-18-52, EASA issued a series of ADs as follows:

• EASA AD 2012-0030, dated February 17, 2012 (EASA AD 2012-0030), which superseded Emergency AD 2011-0156-E, advised that the manufacturer developed improved, newly-designed T/R blades P/N 3G6410A00132 and P/N 4G6410A00132, established life limits for each improved T/R blade, added repetitive inspections for the improved T/R blades, and advised that each T/R blade P/N had its own individual life limit.

• EASA AD 2012-0076, dated May 2, 2012 (EASA AD 2012-0076), which superseded EASA AD 2012-0030 and was issued after the manufacturer developed another version of improved T/R blades P/N 3G6410A00133 and P/N 4G6410A00133 with different materials. AD 2012-0076 required interim life limits for the new improved version of the T/R blades while also retaining the inspection requirements of EASA AD 2012-0030.

• EASA AD 2012-0076R1, dated July 13, 2012 (EASA AD 2012-0076R1), which revised EASA AD 2012-0076 after a modification was developed to allow installation of certain part-numbered T/R blades under certain conditions.

• EASA AD 2012-0076R2, dated February 20, 2014 (EASA AD 2012-0076R2), which revised EASA AD 2012-0076R1, was issued after another modification was developed. EASA AD 2012-0076R2 requires removing the 25 hours TIS inspection of certain part-numbered T/R blades, extending the life limit of certain part-numbered T/R blades, retaining the repetitive inspections of certain part-numbered T/R blades and depending on the inspection results, performing certain applicable corrections.

Also, after AD 2011-18-52 was issued, the FAA issued an NPRM (78 FR 54596), which published in the Federal Register on September 5, 2013. The NPRM proposed to require retaining the inspection requirements for certain part-numbered blades and expand the applicability to include the newly designed blades and establish life limits for those blades. The NPRM also proposed to require replacing any cracked blade or any blade that has reached its life limit. That NPRM was prompted by improved modifications of the T/R blades. However, because the FAA determined that the NPRM does not adequately address the identified unsafe condition, the NPRM was withdrawn on February 25, 2021 (86 FR 11477).

Additional review also revealed necessary changes to address the unsafe condition. This proposed AD clarifies the repetitive inspection for T/R blade P/Ns 3G6410A00131 and P/N 4G6410A00131 from, “visually inspect the T/R blade for a crack or damage” to “visually inspect the T/R blade for a crack and damage.” This proposed AD further revises that repetitive inspection from “damage that exceeds the limits of the applicable maintenance manual” to “damage that exceeds allowable limits” to meet current publishing requirements. This proposed AD clarifies the inspection area for that repetitive inspection by proposing to require using a figure in the related service information instead of using a figure in the body of this AD action. This proposed AD also revises the requirements by removing unnecessary information, including the special flight permits paragraph.

These helicopters have been approved by EASA and are approved for operation in the United States. Pursuant to the FAA's bilateral agreement with the European Union, EASA has notified the FAA of the unsafe condition described in its AD. The FAA is proposing this AD after evaluating all known relevant information and determining that an unsafe condition is likely to exist or develop on other helicopters of the same type design.

The FAA reviewed AgustaWestland S.p.A Mandatory Bollettino Tecnico No. 139-265, Revision B, dated February 18, 2014. This service information specifies a precautionary inspection for a crack, a life limit for the affected T/R blades, and a quarantine of T/R blades that have exceeded their life limit. This service information also provides instructions for mixed usage of the affected T/R blades and sending certain data to the manufacturer.

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 proposed AD would retain the inspection requirements of AD 2011-18-52 for certain part-numbered T/R blades, expand the applicability to include the improved T/R blades, require determining each T/R blade's total hours TIS or landing cycles, and establish life limits for certain T/R blades. This proposed AD would require removing from service any T/R blade that has a crack or damage beyond allowable limits or any T/R blade that has reached its life limit.

The EASA AD does not list the T/R blade life limits and instead references the Airworthiness Limitations Section of 139 AMPI Chapter 4, while this proposed AD would include the life limits in the AD. The EASA AD requires reporting information to Product Support Engineering, whereas this proposed AD would not. The EASA AD requires contacting AgustaWestland if a crack or damage is found during the inspection, whereas this proposed AD would require removing the T/R blade from service.

The FAA estimates that this proposed AD would affect 130 helicopters of U.S. Registry. The FAA estimates that operators may incur the following costs in order to comply with this proposed AD. Labor costs are estimated at $85 per work-hour.

Inspecting one T/R blade for a crack would take about 1 work-hour for an estimated cost of $85 per T/R blade per inspection cycle and up to $44,200 for the U.S. fleet per inspection cycle.

Replacing one T/R blade would take about 8 work-hours and parts would cost about $40,560 for an estimated cost of $41,240 per replacement.

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.

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, I certify this proposed regulation:

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

2. Would not affect intrastate aviation in Alaska, and

3. Would 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 ADDRESSES . Include “Docket No. FAA-2020-0904; Product Identifier 2019-SW-041-AD” at the beginning of your comments. The most helpful comments reference a specific portion of the proposal, explain the reason for any recommended change, and include supporting data. The FAA will consider all comments received by the closing date and may again revise this proposal because of those comments.

Except for Confidential Business Information (CBI) as described in the following paragraph, and other information as described in 14 CFR 11.35, the FAA will post all comments received, without change, to https://www.regulations.gov, including any personal information you provide. The agency will also post a report summarizing each substantive verbal contact received about this proposed AD.

CBI is commercial or financial information that is both customarily and actually treated as private by its owner. Under the Freedom of Information Act (FOIA) (5 U.S.C. 552), CBI is exempt from public disclosure. If your comments responsive to this SNPRM contain commercial or financial information that is customarily treated as private, that you actually treat as private, and that is relevant or responsive to this SNPRM, it is important that you clearly designate the submitted comments as CBI. Please mark each page of your submission containing CBI as “PROPIN.” The FAA will treat such marked submissions as confidential under the FOIA, and they will not be placed in the public docket of this SNPRM. Submissions containing CBI should be sent to James Blyn, Aviation Safety Engineer, Strategic Policy Emerging Aircraft Section, Policy and Innovation Division, FAA, 10101 Hillwood Pkwy., Fort Worth, TX 76177; telephone (817) 222-5110; email james.blyn@faa.gov. Any commentary that the FAA receives which is not specifically designated as CBI will be placed in the public docket for this rulemaking.

The FAA issued an NPRM to amend 14 CFR part 39 by adding an AD that would apply to Airbus Helicopters Model EC225LP helicopters, with left-hand side (LH) engine fuel supply (fuel supply) hose part number (P/N) 704A34416087 installed. The NPRM published in the Federal Register on October 7, 2020, (85 FR 63235). For helicopters delivered to the first operator before November 30, 2018, and for helicopters delivered to the first operator on or after November 30, 2018, that have had the LH fuel supply hose replaced or reinstalled before May 10, 2019, the NPRM proposed to require visually inspecting the LH fuel supply hose for twisting, and if needed, borescope inspecting the entire length of the inside of the fuel supply hose for twisting. Depending on the inspection results, the NPRM proposed to require reinstalling or removing the fuel supply hose from service. Additionally, the NPRM proposed to prohibit installing a certain part-numbered LH fuel supply hose on any helicopter unless that LH fuel supply hose is installed by following certain procedures specified in the manufacturer's service bulletin. The proposed requirements were intended to prevent a decrease of the LH engine power when accelerating to a power setting corresponding to One Engine Inoperative (OEI) power and subsequent reduced control of the helicopter. The NPRM was prompted by EASA AD 2019-0092, dated April 26, 2019 (EASA AD 2019-0092), issued by EASA, which is the Technical Agent for the Member States of the European Union, to correct an unsafe condition for Airbus Helicopters (formerly Eurocopter) Model EC 225 LP helicopters, all serial numbers. EASA advises that an occurrence was reported where during an in-flight single engine power check, the LH side engine experienced a power loss. EASA states that a subsequent investigation determined that the fuel flow to the affected engine was restricted by a twisted fuel supply hose. EASA states that this condition, if not detected and corrected, could lead to a decrease of the LH engine power when accelerating to the power setting corresponding to OEI power, and subsequent reduced control of the helicopter. Accordingly, the EASA AD requires a one-time visual inspection of the fuel supply hose and depending on the inspection results, removing from service or replacing the affected part. EASA also introduces re-installation requirements for a fuel supply hose that is being replaced or reinstalled.

Since the NPRM was issued, the FAA determined that operators may not have the information required to comply with the required actions proposed in the NPRM. Operators may not know the date the helicopter was delivered to the first operator. Additionally, operators may not know whether the LH fuel supply hose has been previously removed or reinstalled since the maintenance regulations do not require certain operators to maintain these records after one year. Accordingly, the FAA has determined the proposed paragraph (e)(1) of the NPRM must be revised by deleting the language referring to delivery dates and dates of LH fuel supply hose replacement or reinstallation. As a result of these changes, all helicopters specified in the applicability paragraph would be required to comply with the required actions in this proposed AD. Also, since the NPRM was issued, the FAA has determined that a limit on special flight permits is required. This SNPRM reflects this change that special flight permits may be permitted provided that there are no passengers on board.

The FAA received no comments on the NPRM or on the determination of the cost.

These helicopters have been approved by EASA and are approved for operation in the United States. Pursuant to the FAA's bilateral agreement with the European Union, EASA has notified the FAA about the unsafe condition described in its AD. The FAA is proposing this AD after determining the unsafe condition described previously is likely to exist or develop in other helicopters of these same type designs. Certain changes described above expand the scope of the NPRM. As a result, it is necessary to reopen the comment period to provide additional opportunity for the public to comment on this SNPRM.

The FAA reviewed Airbus Helicopters Alert Service Bulletin No. EC225-71A019, Revision 1, dated February 28, 2019, which specifies procedures for removing the fuel supply hose from the LH power plant, visually inspecting the fuel supply hose for twisting, and depending on inspection results, performing an endoscope inspection on the inside of the hose. This service information also specifies procedures required to install a serviceable fuel supply hose.

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.

For helicopters with a certain part-numbered LH fuel supply hose installed, this proposed AD would require visually inspecting the LH fuel supply hose for twisting, and if needed, borescope inspecting the entire length of the inside of the fuel supply hose for twisting. Depending on the inspection results, this proposed AD would require reinstalling or removing the fuel supply hose from service. Additionally, this proposed AD would prohibit installing a certain part-numbered LH fuel supply hose on any helicopter unless that LH fuel supply hose is installed by following certain procedures described in the manufacturer's service bulletin.

The EASA AD requires compliance within 110 flight hours or 6 months, whichever occurs first, while this proposed AD would require compliance within 110 hours time-in-service after the effective date of this AD. The EASA AD requires reporting information to Airbus Helicopters if the LH fuel supply hose is twisted on the inside, while this proposed AD would not. Additionally, the EASA AD is applicable to certain aircraft delivered to the first operator prior to 30 Nov 2018, and also to certain aircraft in which the affected part or LH engine were not replaced or reinstalled before the effective date of the EASA AD, whereas this proposed AD would apply to EC225LP helicopters with a certain LH fuel supply hose installed, because operators might not know when the helicopter was first delivered or what maintenance was previously performed.

The FAA estimates that this AD, if adopted as proposed, would affect 28 helicopters of U.S. Registry. Labor rates are estimated at $85 per work-hour. Based on these numbers, the FAA estimates the following costs to comply with this proposed AD.

Visually inspecting the LH fuel supply hose for twisting would take about 1 work-hour for an estimated cost of $85 per helicopter and $2,380 for the U.S. fleet.

Replacing a LH fuel supply hose would take about 8 work-hours and parts would cost about $2,278 for an estimated replacement cost of $2,958 per replacement.

Borescope inspecting the LH fuel supply hose would take about 8 work-hours for an estimated cost of $680 per helicopter.

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.

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, I certify this proposed regulation:

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

(2) Would not affect intrastate aviation in Alaska, and

(3) Would 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 ADDRESSES . Include “Docket No. FAA-2021-0331; Project Identifier AD-2020-01703-T” at the beginning of your comments. The most helpful comments reference a specific portion of the proposal, explain the reason for any recommended change, and include supporting data. The FAA will consider all comments received by the closing date and may amend this proposal because of those comments.

Except for Confidential Business Information (CBI) as described in the following paragraph, and other information as described in 14 CFR 11.35, the FAA will post all comments received, without change, to https://www.regulations.gov, including any personal information you provide. The agency will also post a report summarizing each substantive verbal contact received about this NPRM.

CBI is commercial or financial information that is both customarily and actually treated as private by its owner. Under the Freedom of Information Act (FOIA) (5 U.S.C. 552), CBI is exempt from public disclosure. If your comments responsive to this NPRM contain commercial or financial information that is customarily treated as private, that you actually treat as private, and that is relevant or responsive to this NPRM, it is important that you clearly designate the submitted comments as CBI. Please mark each page of your submission containing CBI as “PROPIN.” The FAA will treat such marked submissions as confidential under the FOIA, and they will not be placed in the public docket of this NPRM. Submissions containing CBI should be sent to Tak Kobayashi, Aerospace Engineer, Propulsion Section, FAA, Seattle ACO Branch, 2200 South 216th St., Des Moines, WA 98198; phone and fax: 206-231-3553; email: takahisa.kobayashi@faa.gov. Any commentary that the FAA receives which is not specifically designated as CBI will be placed in the public docket for this rulemaking.

The FAA has examined the underlying safety issues involved in fuel tank explosions on several large transport airplanes, including the adequacy of existing regulations, the service history of airplanes subject to those regulations, and existing maintenance practices for fuel tank systems. As a result of those findings, the FAA issued a final rule titled “Transport Airplane Fuel Tank System Design Review, Flammability Reduction, and Maintenance and Inspection Requirements” (66 FR 23086, May 7, 2001). In addition to new airworthiness standards for transport airplanes and new maintenance requirements that rule included Amendment 21-78, which established Special Federal Aviation Regulation No. 88 (“SFAR 88”) to 14 CFR part 21. Subsequently, SFAR 88 was amended by: Amendment 21-82 (67 FR 57490, September 10, 2002; corrected at 67 FR 70809, November 26, 2002), Amendment 21-83 (67 FR 72830, December 9, 2002; corrected at 68 FR 37735, June 25, 2003, to change “21-82” to “21-83”), and Amendment 21-101 (83 FR 9162, March 5, 2018).

Among other actions, SFAR 88 requires certain type design ( i.e., type certificate (TC) and supplemental type certificate (STC)) holders to substantiate that their fuel tank systems can prevent ignition sources in the fuel tanks. This requirement applies to type design holders for large turbine-powered transport airplanes and for subsequent modifications to those airplanes. It requires them to perform design reviews and to develop design changes and maintenance procedures if their designs do not meet the new fuel tank safety standards. As explained in the preamble to the final rule published on May 7, 2001, the FAA intended to adopt airworthiness directives to mandate any changes found necessary to address unsafe conditions identified as a result of these reviews.

In evaluating these design reviews, the FAA has established four criteria intended to define the unsafe conditions associated with fuel tank systems that require corrective actions. The percentage of operating time during which fuel tanks are exposed to flammable conditions is one of these criteria. The other three criteria address the failure types under evaluation: Single failures, single failures in combination with another latent condition(s), and in-service failure experience. For all four criteria, the evaluations included consideration of previous actions taken that may mitigate the need for further action.

The FAA issued AD 2012-12-15, Amendment 39-17095 (77 FR 42964, July 23, 2012) (AD 2012-12-15), which applies to all The Boeing Company Model 757 airplanes. AD 2012-12-15 requires revising the maintenance or inspection program to incorporate new limitations for fuel tank systems. AD 2012-12-15 also requires the initial inspection of certain repetitive AWL inspections to phase-in those inspections, and repair if necessary. Since the FAA issued AD 2012-12-15, the Airworthiness Limitations Section (ALS) of the Instructions for Continued Airworthiness (Boeing document D622N001-9) has been significantly revised by the manufacturer to correct technical and editorial errors and also to add new or more restrictive requirements. Many of those changes are related to fuel tank ignition prevention and the nitrogen generation system. Incorporating the revision required by this proposed AD would terminate all the requirements of AD 2012-12-15.

The FAA also issued AD 2018-20-13, Amendment 39-19447 (83 FR 52305, October 17, 2018) (2018-20-13), which applies to all The Boeing Company Model 757 airplanes; Model 737 airplanes, excluding Model 737-100, -200, -200C, -300, -400, and -500 series airplanes; and Model 767-200, -300, -300F, and -400ER series airplanes. For Model 757 airplanes, AD 2018-20-13 requires, among other things, revising the maintenance or inspection program to incorporate AWLs No. 28-AWL-23, 28-AWL-24, and 28-AWL-25. Since the FAA issued 2018-20-13, those AWLs have been revised, therefore, this proposed AD would require the incorporation of those revised AWLs. Incorporating the revision required by this proposed AD would terminate the requirements in paragraph (i)(2) of AD 2018-20-13.

The FAA has assessed the changes, including new or more restrictive requirements, that were made to the AWLs related to fuel tank ignition prevention and the nitrogen generation system. The FAA is issuing this AD to address ignition sources inside the fuel tanks and the increased flammability exposure of the center fuel tank caused by latent failures, alterations, repairs, or maintenance actions, which could result in a fuel tank explosion and consequent loss of an airplane.

The FAA is issuing this NPRM after determining that the unsafe condition described previously is likely to exist or develop on other products of the same type design.

The FAA reviewed Section 9, Airworthiness Limitations (AWLs) and Certification Maintenance Requirements (CMRs), of Boeing 757 Maintenance Planning Data (MPD) Document, D622N001-9, dated March 2020. This service information specifies airworthiness limitation instruction (ALI) and critical design configuration control limitation (CDCCL) tasks related to fuel tank ignition prevention and the nitrogen generation system.

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 ADDRESSES .

This proposed AD would require revising the existing maintenance or inspection program, as applicable, to incorporate new or more restrictive airworthiness limitations.

This proposed AD would require revisions to certain operator maintenance documents to include new actions ( e.g., inspections) and CDCCLs. Compliance with these actions and CDCCLs is required by 14 CFR 91.403(c). For airplanes that have been previously modified, altered, or repaired in the areas addressed by this proposed AD, the operator may not be able to accomplish the actions described in the revisions. In this situation, to comply with 14 CFR 91.403(c), the operator must request approval for an alternative method of compliance according to paragraph (k) of this proposed AD.

Paragraph (g) of this proposed AD would require operators to revise their existing maintenance or inspection program by incorporating, in part, AWL No. 28-AWL-05, “Wire Separation Requirements for New Wiring Installed in Proximity to Wiring that Goes into the Fuel Tanks,” of Section 9, Airworthiness Limitations (AWLs) and Certification Maintenance Requirements (CMRs), of Boeing 757 Maintenance Planning Data (MPD) Document, D622N001-9, dated March 2020.

Paragraph (h) of this proposed AD would allow certain changes to be made to the requirements specified in AWL No. 28-AWL-05 as an option. Where AWL No. 28-AWL-05 identifies certain wire types for routing and installation of any new wiring under certain conditions, paragraph (h) of this proposed AD provides acceptable alternative wire types. Where AWL No. 28-AWL-05 identifies certain wiring sleeve material for new wiring installed under certain conditions, paragraph (h) of this proposed AD provides acceptable alternative wire sleeve materials.

The FAA estimates that this AD, if adopted as proposed, would affect 493 airplanes of U.S. registry. The FAA estimates the following costs to comply with this proposed AD:

The FAA has determined that revising the existing maintenance or inspection program takes an average of 90 work-hours per operator, although the agency recognizes that this number may vary from operator to operator. Since operators incorporate maintenance or inspection program changes for their affected fleet(s), the FAA has determined that a per-operator estimate is more accurate than a per-airplane estimate. Therefore, the FAA estimates the average total cost per operator to be $7,650 (90 work-hours × $85 per work-hour).

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.

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) Would not affect intrastate aviation in Alaska, and

(3) Would 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 ADDRESSES . Include “Docket No. FAA-2021-0349; Project Identifier MCAI-2021-00103-T” at the beginning of your comments. The most helpful comments reference a specific portion of the proposal, explain the reason for any recommended change, and include supporting data. The FAA will consider all comments received by the closing date and may amend the proposal because of those comments.

Except for Confidential Business Information (CBI) as described in the following paragraph, and other information as described in 14 CFR 11.35, the FAA will post all comments received, without change, to https://www.regulations.gov, including any personal information you provide. The agency will also post a report summarizing each substantive verbal contact received about this proposed AD.

CBI is commercial or financial information that is both customarily and actually treated as private by its owner. Under the Freedom of Information Act (FOIA) (5 U.S.C. 552), CBI is exempt from public disclosure. If your comments responsive to this NPRM contain commercial or financial information that is customarily treated as private, that you actually treat as private, and that is relevant or responsive to this NPRM, it is important that you clearly designate the submitted comments as CBI. Please mark each page of your submission containing CBI as “PROPIN.” The FAA will treat such marked submissions as confidential under the FOIA, and they will not be placed in the public docket of this NPRM. Submissions containing CBI should be sent to Vladimir Ulyanov, Aerospace Engineer, Large Aircraft Section, International Validation Branch, FAA, 2200 South 216th St., Des Moines, WA 98198; telephone and fax 206-231-3229; email vladimir.ulyanov@faa.gov. Any commentary that the FAA receives which is not specifically designated as CBI will be placed in the public docket for this rulemaking.

The EASA, which is the Technical Agent for the Member States of the European Union, has issued EASA AD 2021-0035, dated January 25, 2021 (EASA AD 2021-0035) (also referred to as the Mandatory Continuing Airworthiness Information, or the MCAI), to correct an unsafe condition for all Airbus SAS Model A330-841 and -941 airplanes.

This proposed AD was prompted by reports of missing or disbonded pressure seals on two TR translating cowls. An investigation determined that the issue is due to surface preparation not being properly performed during seal installation. The FAA is proposing this AD to address missing or disbonded TR translating cowl seal segments. In a case where all seal segments were missing, this condition, if not addressed, could lead to loss of thrust at maximum continuous thrust or at takeoff/go-around, possibly resulting in substantially reduced performance of the airplane. See the MCAI for additional background information.

EASA AD 2021-0035 describes procedures for inspecting the each thrust reverser for damage (including tears, cracks, unwanted sealant on the contact surface, missing pieces, worn-out seals, or glass or ceramic ply that is not impacted), reworking the pressure seal bonding, and replacing damaged translating cowl pressure seals.

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 2021-0035 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 2021-0035 will be incorporated by reference in the FAA final rule. This proposed AD would, therefore, require compliance with EASA AD 2021-0035 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 2021-0035 that is required for compliance with EASA AD 2021-0035 will be available on the internet at https://www.regulations.gov by searching for and locating Docket No. FAA-2021-0349 after the FAA final rule is published.

The FAA estimates that this proposed AD affects 8 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 these on-condition actions:

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 operators. The FAA does not control warranty coverage for affected operators. As a result, the FAA has included all known costs in the 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.

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) Would not affect intrastate aviation in Alaska, and

(3) Would 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 revoke the Class E airspace extending upward from 700 feet above the surface at Standish Industrial Airport, Standish, MI, due to the closure of the airport and cancellation of the instrument procedures 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-2021-0277/Airspace Docket No. 21-AGL-19.” 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 7400.11E, Airspace Designations and Reporting Points, dated July 21, 2020, and effective September 15, 2020. FAA Order 7400.11E is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11E lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

The FAA is proposing an amendment to 14 CFR part 71 by revoking the Class E airspace extending upward from 700 feet above the surface to at Standish Industrial Airport, Standish, MI.

This action is the result of an airspace review due to the closing of the Standish Industrial Airport, Standish, MI, and cancellation of the instrument procedures at this airport.

Class E airspace designations are published in paragraph 6005 of FAA Order 7400.11E, dated July 21, 2020, and effective September 15, 2020, 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 the 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 modify the route structure as necessary to preserve the safe and efficient flow of air traffic within the National Airspace System.

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 (FAA Docket No. FAA-2021-0324; Airspace Docket No. 21-AGL-9) and be submitted in triplicate to the Docket Management Facility (see ADDRESSES section for address and phone number). You may also submit comments through the internet at https://www.regulations.gov.

Commenters 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-2021-0324; Airspace Docket No. 21-AGL-9.” The postcard will be date/time stamped and returned to the commenter.

All communications received on or before the specified comment closing date will be considered before taking action on the proposed rule. The proposal contained in this action may be changed in light of 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 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 during normal business hours at the office of the Operations Support Group, Central Service Center, Federal Aviation Administration, 10101 Hillwood Parkway, Fort Worth, TX, 76177.

This document proposes to amend FAA Order 7400.11E, Airspace Designations and Reporting Points, dated July 21, 2020, and effective September 15, 2020. FAA Order 7400.11E is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11E lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

The FAA is planning to decommission the VOR portion of the Erie, PA, VORTAC. This VOR was one of the candidate VORs identified for discontinuance by the FAA's VOR MON program and listed in the final policy statement notice, “Provision of Navigation Services for the Next Generation Air Transportation System (NextGen) Transition to Performance-Based Navigation (PBN) (Plan for Establishing a VOR Minimum Operational Network),” published in the Federal Register of July 26, 2016 (81 FR 48694), Docket No. FAA-2011-1082.

Although the VOR portion of the Eric VORTAC is planned for decommissioning, the co-located DME portion of the navigational aid is being retained in support of current and future Area Navigation (RNAV) procedures. The tactical air navigation (TACAN) system is also being retained to support the Department of Defense mission requirements.

The VOR Federal airways affected by the Erie VOR are V-37, V-270, and V-43. With the planned decommissioning of the VOR portion of the Erie VORTAC, the remaining navigational aids in the area are insufficient to enable the continuity of the affected airways. As such, the proposal would result in the shortening of V-37 and V-270, and would result in the revocation of V-43. To overcome the shortening and removal of the proposed airways, pilots using RNAV could navigate point to point utilizing the fixes that would be retained or request air traffic control radar vectors through the area. Additionally, visual flight rules (VFR) pilots who elect to navigate via the affected airways could also take advantage of the air traffic control (ATC) services previously listed.

The FAA is proposing an amendment to 14 CFR part 71 to amend V-37 and V-270, and revoke V-43, in the vicinity of Erie, PA. This is required due to the planned decommissioning of the VOR portion of the Erie, PA, VORTAC. The proposed airway changes are described below.

V-37: V-37 currently extends between the Craig, FL, VORTAC and the Erie, PA VORTAC. The FAA proposes to remove the airway segment between the Ellwood City, PA, VOR/DME and the Erie VORTAC. As a result, the amended airway would extend between the Craig VORTAC and the Ellwood City VOR/DME.

V-270: V-270 currently extends between the Erie, PA, VORTAC and the Jamestown, NY, VOR/DME; and between the Elmira, NY, VOR/DME and the Boston, MA, VOR/DME. The FAA proposes to remove the airway segment between the Erie VORTAC and the Jamestown VOR/DME. As a result, the amended airway would extend between the Elmira VOR/DME and the Boston VOR/DME.

V-43: V-43 currently extends between the Youngstown, OH, VORTAC and the Erie, PA, VORTAC. The FAA proposes to remove V-43 in its entirety.

All radials in the VOR Federal airway descriptions below are unchanged and stated in True degrees.

Domestic VOR Federal airways are published in paragraph 6010(a) of FAA Order 7400.11E, dated July 21, 2020, and effective September 15, 2020, which is incorporated by reference in 14 CFR 71.1. The VOR Federal airways listed in this document would be subsequently published 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 Department of Transportation (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:

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 and establish Class E airspace in York, PA, 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-2021-0119 and Airspace Docket No. 21-AEA-3) 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-2021-0119; Airspace Docket No. 21-AEA-3.” 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 7400.11E, Airspace Designations and Reporting Points, dated July 21, 2020, and effective September 15, 2020. FAA Order 7400.11E is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11E lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

The FAA proposes an amendment to 14 14 CFR part 71 to amend Class E surface airspace by increasing the radius to 6.8 miles (previously 6.5 miles) at York Airport, York, PA. This action would also would update the airports name. This action would also establish Class E airspace upward from 700 feet above the surface at York Airport, York, PA, and establish Class E airspace upward from 700 feet above the surface at Wellstone York Hospital Heliport, York, PA, providing the controlled airspace required to support the new RNAV (GPS) standard instrument approach procedures for IFR operations serving them respectively.

Class E airspace designations are published in Paragraph 6005, of FAA Order 7400.11E, dated July 21, 2020, and effective September 15, 2020, 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 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 revoke the Class E surface airspace at St. Clair County International 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-2021-0235/Airspace Docket No. 21-AGL-18.” 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 7400.11E, Airspace Designations and Reporting Points, dated July 21, 2020, and effective September 15, 2020. FAA Order 7400.11E is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11E lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

The FAA is proposing an amendment to 14 CFR part 71 by removing the Class E surface area at St. Clair County International Airport as it is no longer required.

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

Class E airspace designations are published in paragraph 6002 respectively, of FAA Order 7400.11E, dated July 21, 2020, and effective September 15, 2020, 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 the 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 modify the route structure as necessary to preserve the safe and efficient flow of air traffic within the National Airspace System.

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 (FAA Docket No. FAA-2021-0288; Airspace Docket No. 21-AGL-6) and be submitted in triplicate to the Docket Management Facility (see ADDRESSES section for address and phone number). You may also submit comments through the internet at https://www.regulations.gov.

Commenters 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-2021-0288; Airspace Docket No. 21-AGL-6.” The postcard will be date/time stamped and returned to the commenter.

All communications received on or before the specified comment closing date will be considered before taking action on the proposed rule. The proposal contained in this action may be changed in light of 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 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 during normal business hours at the office of the Operations Support Group, Central Service Center, Federal Aviation Administration, 10101 Hillwood Parkway, Fort Worth, TX 76177.

This document proposes to amend FAA Order 7400.11E, Airspace Designations and Reporting Points, dated July 21, 2020, and effective September 15, 2020. FAA Order 7400.11E is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11E lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

In support of FAA-led modernization efforts to improve the safety, efficiency, and predictability of the national airspace, as well as transition the NAS from a ground-based to a satellite-based Performance Based Navigation (PBN) system, the FAA is proposing to amend RNAV route T-348 by extending it to provide additional PBN enroute structure, and establish RNAV route T-409. This action would reduce air traffic control (ATC) sector workload and complexity, reduce pilot-to-controller communication, and assist ATC when non-radar procedures are required. These RNAV routes would be available for use by any aircraft equipped with Global Positioning Satellite (GPS) and/or RNAV navigation capabilities.

Additionally, both RNAV route proposals have transiting legs that pass through the Lake Andes Military Operations Areas (MOA). This would provide cost, fuel, and time saving benefits for aircraft transiting the MOA when the MOA is not in use.

The FAA is proposing an amendment to 14 CFR part 71 to amend RNAV route T-348 and establish RNAV route T-409. The proposed route changes are described below.

T-348: T-348 currently extends between the BRAIN, MN, waypoint (WP) and the LUNGS, WI, WP. The FAA proposes to extend the route westward between the LESNR, SD, WP and the BRAIN, MN, WP. As a result of the addition of the proposed segment, the BRAIN WP would remain in place but would no longer be referenced in the legal description. The new proposed route would flow from the LESNR WP, through the TECUD, SD, fix and Sioux Falls, SD, VOR/Tactical Air Navigation (VORTAC), to the GRSIS, MN, WP onward. The resulting RNAV route would extend between the LESNR WP and the LUNGS WP.

T-409: T-409 is a proposed new route that would extend between the LLUKY, NE, WP and the Pierre, SD, VORTAC. This route would mitigate the loss of the V-71 airway segments removed on September 10, 2020 due to the decommissioning of the Winner, SD, VOR.

All radials in the RNAV T-route descriptions below are unchanged and stated in True degrees.

United States Area Navigation routes are published in paragraph 6011 of FAA Order 7400.11E, dated July 21, 2020, and effective September 15, 2020, which is incorporated by reference in 14 CFR 71.1. The RNAV routes listed in this document would be subsequently published 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 Department of Transportation (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 the Class E airspace extending upward from 700 feet above the surface at Pocahontas Municipal Airport, IA, to support instrument flight rule 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-2021-0278/Airspace Docket No. 21-ACE-10.” 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 7400.11E, Airspace Designations and Reporting Points, dated July 21, 2020, and effective September 15, 2020. FAA Order 7400.11E is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11E lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

The FAA is proposing an amendment to 14 CFR part 71 by amending the Class E airspace extending upward from 700 feet above the surface within a 6.4-mile radius of Pocahontas Municipal Airport, Pocahontas, IA; and removes the Pocahontas NDB and the associated extensions from the airspace legal description.

This action is the result of an airspace review due to the decommissioning of the Pocahontas NDB which provided navigation information for the instrument procedures at this airport.

Class E airspace designations are published in paragraph 6005 of FAA Order 7400.11E, dated July 21, 2020, and effective September 15, 2020, 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:

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 the 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 modify the route structure as necessary to preserve the safe and efficient flow of air traffic within the NAS.

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 (FAA Docket No. FAA-2021-0294; Airspace Docket No. 20-ASO-31) and be submitted in triplicate to the Docket Management Facility (see ADDRESSES section for address and phone number). You may also submit comments through the internet at https://www.regulations.gov.

Commenters 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-2021-0294; Airspace Docket No. 20-ASO-31.” The postcard will be date/time stamped and returned to the commenter.

All communications received on or before the specified comment closing date will be considered before taking action on the proposed rule. The proposal contained in this action may be changed in light of 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 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 during normal business hours at the office of the Eastern Service Center, Federal Aviation Administration, Room 210, 1701 Columbia Ave., College Park, GA 30337.

This document proposes to amend FAA Order 7400.11E, Airspace Designations and Reporting Points, dated July 21, 2020, and effective September 15, 2020. FAA Order 7400.11E is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11E lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

The FAA is proposing an amendment to 14 CFR part 71 to amend three jet routes, and remove four jet routes, in the eastern United States. This action would support the Northeast Corridor Atlantic Coast Route Project by amending and removing certain jet route segments that are being replaced by RNAV routing. Additionally, the proposed jet route changes would reduce aeronautical chart clutter by removing unneeded route segments.

The proposed route changes are as follows:

J-42: J-42 currently extends between the Delicias, Mexico, VOR/DME, and the Boston, MA, VOR/DME. This action would remove the segments between Texarkana, AR, and Boston, MA. The amended route would extend between Delicias, Mexico and Texarkana, AR. The portion within Mexico is excluded.

J-55: J-55 currently extends in, two parts, between the intersection of the Flat Rock, VA 212° and the Raleigh-Durham, NC, 224° radials, and the intersection of the Hopewell, VA, 030° and the Nottingham, MD 174° radials; and between the Sea Isle, NJ and Presque Isle, ME. The FAA proposes to remove the segments between Sea Isle, NJ and Presque Isle ME. The amended route would extend from the intersection of the Flat Rock, VA 212° and the Raleigh-Durham, NC, 224° radials, and the intersection of the Hopewell, VA, 030° and the Nottingham, MD 174° radials.

J-150: J-150 extends between the Gordonsville, VA, VORTAC and the Marconi, MA, 082° and the Boston, MA, 097° radials (STOOL intersection). The FAA proposes to remove the entire route.

J-191: J-191 currently extends between the Robbinsville, NJ, VORTAC, and the Wilmington, NC, VORTAC. The FAA proposes to remove the segments between Robbinsville, NJ, and Patuxent, MD. The amended route would extend between Hopewell, VA and Wilmington, NC.

J-193: J-193 currently extends between the Wilmington, NC, VORTAC, and the intersection of the Harcum, VA, VORTAC 006° and Hopewell, VA, VORTAC 030° radials (HUBBS intersection). The FAA proposes to remove the entire route.

J-222: J-222 currently extends between the Robbinsville, NJ, VORTAC, and the Cambridge, NY, VOR/DME. The FAA proposes to remove the entire route.

J-225: J-225 currently extends between the Cedar Lake, NJ, VOR/DME, and the Providence, RI, VOR/DME. The FAA proposes to remove the entire route.

Jet routes are published in paragraph 2004, of FAA Order 7400.11E dated July 21, 2020, and effective September 15, 2020, which is incorporated by reference in 14 CFR 71.1. The jet routes listed in this document would be subsequently amended in, or removed, respectively, from 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 Department of Transportation (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:

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 the 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 modify the route structure as necessary to preserve the safe and efficient flow of air traffic within the National Airspace System.

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 (FAA Docket No. FAA-2021-0279; Airspace Docket No. 21-AGL-13) and be submitted in triplicate to the Docket Management Facility (see ADDRESSES section for address and phone number). You may also submit comments through the internet at https://www.regulations.gov.

Commenters 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-2021-0279; Airspace Docket No. 21-AGL-13.” The postcard will be date/time stamped and returned to the commenter.

All communications received on or before the specified comment closing date will be considered before taking action on the proposed rule. The proposal contained in this action may be changed in light of 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 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 during normal business hours at the office of the Operations Support Group, Central Service Center, Federal Aviation Administration, 10101 Hillwood Parkway, Fort Worth, TX 76177.

This document proposes to amend FAA Order 7400.11E, Airspace Designations and Reporting Points, dated July 21, 2020, and effective September 15, 2020. FAA Order 7400.11E is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11E lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

NAV CANADA, which operates Canada's civil air navigation service, is implementing changes to Canada's instrument flight rules (IFR) navigation infrastructure as part of their NAVAID Modernization Program. This program is designed to enhance the efficiency of Canada's flying operations by taking advantage of performance-based navigation and modern avionic capabilities. As such, changes implemented by NAV CANADA occasionally affect VOR Federal airways that extend across the United States/Canada border into the United States.

NAV CANADA is planning to decommission the Elliot Lake and Dryden NDBs as part of their NAVAID Modernization Program. As a result, amendments of V-36 and V-316, and the removal of V-180, are required to mirror changes that are planned to be made by NAV CANADA within Canadian airspace. To mitigate the deletion of V-36 and V-316 airway segments affected by the NDBs being decommissioned, IFR traffic may use adjacent VOR Federal airways, V-300 and V-348, or request air traffic control (ATC) radar vectors to fly around or through the affected area. To mitigate the deletion of V-180, IFR traffic may use adjacent VOR Federal airways, V-133 and V-367, or request ATC radar vectors to fly through or circumnavigate the affected area also. Aircraft with Area Navigation (RNAV) equipment may also navigate point to point using airspace fixes that will remain in place. Visual flight rules (VFR) pilots who elect to navigate via the airways through the affected area could also take advantage of the adjacent VOR Federal airways or ATC services listed previously.

The FAA is proposing an amendment to 14 CFR part 71 to amend V-36 and V-316, and remove V-180 due to the planned decommissioning of the Elliot Lake and Dryden NDBs, ON, Canada to mirror changes that are planned to be made by NAV CANADA within Canadian airspace. The proposed Federal airway amendments and removal are described below.

V-36: V-36 currently extends between the Thunder Bay, ON, Canada, VOR/DME and the intersection of the Wiarton, ON, Canada, VOR/DME 150° radial and Toronto, ON, Canada, VOR/DME 304° radial; and between the Buffalo, NY, VOR/DME and the intersection of the La Guardia, NY, VOR/DME 310° and Stillwater, NJ, VOR/DME 043° radials. The airspace within Canada is excluded. The FAA proposes to remove the airway segment between the Thunder Bay, ON, Canada, VOR/DME and Wawa, ON, Canada, VOR/DME. The FAA also proposes to remove the airway segment between the Sault Ste Marie, MI, VOR/DME and the intersection of the La Guardia, NY, VOR/DME 310° and Stillwater, NJ, VOR/DME 043° radials (NEION fix). The resulting airway would extend between the Wawa, ON, Canada, VOR/DME and the Sault Ste Marie, MI, VOR/DME; and between the Buffalo, NY, VOR/DME and the intersection of the La Guardia, NY, VOR/DME 310° and Stillwater, NJ, VOR/DME 043° radials (NEION fix). Concurrent changes to other segments of V-36 have been proposed in a separate rulemaking proposal.

V-316: V-316 currently extends between the Ironwood, MI, VOR/DME and the Sawyer, MI, VOR/DME; and between the Sault Ste Marie, MI, VOR/DME and the Sudbury, ON, Canada, VOR/DME. The airspace in Canada is excluded. The FAA proposes to delete the airway segment between the Sault Ste Marie, MI, VOR/DME and the Sudbury, ON, Canada, VOR/DME, and the exclusionary language. The resulting airway would extend between the Ironwood, MI, VOR/DME and the Sawyer, MI, VOR/DME.

V-180: V-180 currently extends between the International Falls, MN, VOR/DME and the Dryden, ON, Canada, NDB. The airspace within Canada is excluded. The FAA proposes to remove the airway in its entirety.

All radials in the VOR Federal airway descriptions below are unchanged and stated in True degrees.

VOR Federal airways are published in paragraph 6010(a) of FAA Order 7400.11E, dated July 21, 2020, and effective September 15, 2020, which is incorporated by reference in 14 CFR 71.1. The VOR Federal airways listed in this document would be subsequently updated in the next edition of this 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 Department of Transportation (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:

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 modify the Class E airspace at Shively Field Airport, Saratoga, WY, to support 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-2021-0274; Airspace Docket No. 20-ANM-58”. 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 7400.11E, Airspace Designations and Reporting Points, dated July 21, 2020, and effective September 15, 2020. FAA Order 7400.11E is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11E lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

The FAA is proposing an amendment to 14 CFR part 71 by modifying the Class E airspace, extending upward from 700 feet above the surface, at Shively Field Airport, Saratoga, WY. This airspace is designed to contain IFR departures to 1,200 feet above the surface and IFR arrivals descending below 1,500 feet above the surface. To properly contain arriving and departing IFR aircraft, the radius south of the airport should be reduced from 6.9 miles to 5 miles. The radius north of the airport should increase from 6.9 miles to 7.3 miles. Also, the area extending north of the airport should be increased to properly contain IFR aircraft performing a procedure turn maneuver for the NDB-A Approach.

This action also 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 en route airspace and duplication is not necessary.

Further, this action proposes to remove the Saratoga NDB and the Cherokee VOR/DME from the Class E's text header and airspace description. The navigational aids (NAVAIDs) are not needed to define the airspace and removal of the NAVAIDs simplifies the airspace's description.

Lastly, the action proposes administrative updates to the airspace's text header. The city name should be removed from the second line of the text header, and the airport's geographic coordinates on the third line of the text header should be updated to “lat. 41°26′37″ N, long. 106°49′39″ W” to match the FAA database.

Class E5 airspace designations are published in paragraph 6005 of FAA Order 7400.11E, dated July 21, 2020, and effective September 15, 2020, 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:

The Fifth Coast Guard District has been been notified of three fireworks displays planned throughout the Maryland-National Capital Region to commemorate the July 4th holiday. Hazards from these fireworks displays include accidental discharge of fireworks, dangerous projectiles, and falling hot embers or other debris. To respond to these hazards, the Coast Guard plans to establish temporary safety zones to protect the nearby public.

1. The Sherwood Forest Club, Inc., of Sherwood Forest, MD, plans to conduct a fireworks display from 9:20 p.m. to 9:50 p.m. on July 3, 2021. The fireworks are to be launched from the end of the Sherwood Forest Club main pier, located adjacent to the Severn River, approximately 200 yards east of Brewer Pond in Sherwood Forest, MD. In the event of inclement weather, the fireworks display will be scheduled for July 5, 2021. The COTP Maryland-National Capital Region has determined that potential hazards associated with the fireworks to be used in this display would be a safety concern for anyone within 150 yards of the fireworks discharge site.

2. Queen Anne's County Government, of Centreville, MD, plans to conduct a fireworks display from 10 p.m. to 10:20 p.m. on July 4, 2021. The fireworks are to be launched from Kent Island along the Kent Island Narrows (North Approach) in Chester, MD. In the event of inclement weather, the fireworks display will be scheduled for July 5, 2021. The COTP Maryland-National Capital Region has determined that potential hazards associated with the fireworks to be used in this display would be a safety concern for anyone within 800 feet of the fireworks discharge site.

3. The Independence Day Commission of Havre de Grace, MD, plans to conduct a fireworks display from 9:30 p.m. to 10 p.m. on July 4, 2021. The fireworks are to be launched from a fireworks barge located in the Susquehanna River, approximately 300 yards southeast of Concord Point in Havre de Grace, MD. In the event of inclement weather, the fireworks display will be scheduled for July 5, 2021. The COTP Maryland-National Capital Region has determined that potential hazards associated with the fireworks to be used in this display would be a safety concern for anyone within 200 yards of the fireworks barge.

The Coast Guard is requesting that interested parties provide comments within a shortened comment period of 15 days instead of the typical 30 days for this notice of proposed rulemaking. The Coast Guard believes a shortened comment period is necessary and reasonable to ensure the Coast Guard has time to review and respond to any significant comments submitted by the public in response to this NPRM and has a final rule in effect in time for the first scheduled event.

The Coast Guard is proposing this rulemaking under authority in 46 U.S.C. 70034 (previously 33 U.S.C. 1231).

The COTP is proposing to establish three temporary safety zones for certain navigable waters within the COTP Maryland-National Capital Region Zone, as described in 33 CFR 3.25-15, and would be enforced during the times described below for each zone.

The first safety zone would be enforced from 8:30 p.m. to 10:30 p.m. on July 3, 2021, or if necessary due to inclement weather, from 8:30 p.m. to 10:30 p.m. on July 5, 2021. The safety zone would cover all navigable waters of the Severn River, within 150 yards of a fireworks discharge site located at the end of Sherwood Forest Club main pier in approximate position latitude 39°01′54.0″ N, longitude 076°32′41.8″ W, Sherwood Forest, MD. The duration of the zone is intended to ensure the safety of vessels and these navigable waters before, during, and after the scheduled 9:20 p.m. to 9:50 p.m. on July 3, 2021 fireworks display.

The second safety zone would be enforced from 9 p.m. to 11 p.m. on July 4, 2021, or if necessary due to inclement weather, from 9 p.m. to 11 p.m. on July 5, 2021. The safety zone would cover all navigable waters of the Kent Island Narrows (North Approach), within 800 feet of the fireworks launch site at Kent Island in approximate position latitude 38°58′44.8″ N, longitude 076°14′52.9″ W, in Queen Anne's County, MD. The duration of the zone is intended to ensure the safety of vessels and these navigable waters before, during, and after the scheduled 10 p.m. to 10:20 p.m. on July 4, 2021 fireworks display.

The third safety zone would be enforced from 8:30 p.m. to 10:30 p.m. on July 4, 2021, or if necessary due to inclement weather, from 8:30 p.m. to 10:30 p.m. on July 5, 2021. The safety zone would cover all navigable waters of the Susquehanna River within 200 yards of a barge in approximate position latitude 39°32′19″ N, longitude 076°04′58.3″ W, located at Havre de Grace, MD. The duration of the zone is intended to ensure the safety of vessels and these navigable waters before, during, and after the scheduled 9:30 to 10 p.m. on July 4, 2021 fireworks display.

No vessel or person would be permitted to enter these safety zones without obtaining permission from the COTP or a designated representative. The regulatory text we are proposing appears at the end of this document.

We developed this proposed rule after considering numerous statutes and Executive orders related to rulemaking. Below we summarize our analyses based on a number of these statutes and Executive orders, and we discuss First Amendment rights of protestors.

Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. This NPRM has not been designated a “significant regulatory action,” under Executive Order 12866. Accordingly, the NPRM has not been reviewed by the Office of Management and Budget (OMB).

This regulatory action determination is based on the size, duration, and time-of-day of the safety zones, which would impact small designated areas of the Severn River, Kent Island Narrows (North Approach), and Susquehanna River for a total no more than six total enforcement-hours, during the evening when vessel traffic is normally low. Moreover, the Coast Guard will issue Local Notices to Mariners and a Broadcast Notice to Mariners via VHF-FM marine channel 16 about the zones.

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

While some owners or operators of vessels intending to transit the safety zone may be small entities, for the reasons stated in section IV.A above, this proposed rule would not have a significant economic impact on any vessel owner or operator.

If you think that your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment (see ADDRESSES ) explaining why you think it qualifies and how and to what degree this rule would economically affect it.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this proposed rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please call or email the person listed in the FOR FURTHER INFORMATION CONTACT section. The Coast Guard will not retaliate against small entities that question or complain about this proposed rule or any policy or action of the Coast Guard.

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

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

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

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

We have analyzed this proposed rule under Department of Homeland Security Directive 023-01, Rev. 1, associated implementing instructions, and Environmental Planning COMDTINST 5090.1 (series), which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have made a preliminary determination that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This proposed rule involves five safety zones lasting six total enforcement hours that would prohibit entry within portions of the Severn River, Kent Island Narrows (North Approach), and Susquehanna River. Normally such actions are categorically excluded from further review under paragraph L60(a) of Appendix A, Table 1 of DHS Instruction Manual 023-01-001-01, Rev. 1. A preliminary Record of Environmental Consideration supporting this determination is available in the docket. For instructions on locating the docket, see the ADDRESSES section of this preamble. We seek any comments or information that may lead to the discovery of a significant environmental impact from this proposed rule.

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

We view public participation as essential to effective rulemaking, and will consider all comments and material received during the comment period. Your comment can help shape the outcome of this rulemaking. If you submit a comment, please include the docket number for this rulemaking, indicate the specific section of this document to which each comment applies, and provide a reason for each suggestion or recommendation.

We encourage you to submit comments through the Federal eRulemaking Portal at https://www.regulations.gov. If your material cannot be submitted using https://www.regulations.gov, call or email the person in the FOR FURTHER INFORMATION CONTACT section of this document for alternate instructions.

We accept anonymous comments. Comments we post to https://www.regulations.gov will include any personal information you have provided. For more about privacy and submissions in response to this document, see DHS's eRulemaking System of Records notice (85 FR 14226, March 11, 2020).

Documents mentioned in this NPRM as being available in the docket, and public comments, will be in our online docket at https://www.regulations.gov and can be viewed by following that website's instructions. We review all comments received, but we will only post comments that address the topic of the proposed rule. We may choose not to post off-topic, inappropriate, or duplicate comments that we receive. If you go to the online docket and sign up for email alerts, you will be notified when comments are posted or a final rule is published.

For the reasons discussed in the preamble, the Coast Guard is proposing to amend 33 CFR part 165 as follows:

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

Ground-level ozone pollution is formed from the reaction of volatile organic compounds (VOC) and oxides of nitrogen (NO X ) in the presence of sunlight. 1 These two pollutants, referred to as ozone precursors, are emitted by many types of sources, including on-and off-road motor vehicles and engines, power plants and industrial facilities, and smaller area sources such as lawn and garden equipment and paints.

Scientific evidence indicates that adverse public health effects occur following exposure to ozone, particularly in children and adults with lung disease. Breathing air containing ozone can reduce lung function and inflame airways, which can increase respiratory symptoms and aggravate asthma or other lung diseases. 2

Under section 109 of the Clean Air Act (CAA or “Act”), the EPA promulgates NAAQS for pervasive air pollutants, such as ozone. The EPA has previously promulgated NAAQS for ozone in 1979 and 1997. 3 In 2008, the EPA revised and further strengthened the ozone NAAQS by setting the acceptable level of ozone in the ambient air at 0.075 parts per million (ppm) averaged over an 8-hour period. 4 Although the EPA further tightened the 8-hour ozone NAAQS to 0.070 ppm in 2015, this action relates to the requirements for the 2008 ozone NAAQS. 5

Following promulgation of a new or revised NAAQS, the EPA is required under CAA section 107(d) to designate areas throughout the country as attaining or not attaining the NAAQS. The “Los Angeles-San Bernardino Counties (West Mojave Desert), CA” area (“West Mojave Desert” or WMD) was designated as nonattainment for the 2008 ozone standards on May 21, 2012 and classified as “Severe-15.”  6

Under the CAA, after the EPA designates areas as nonattainment for a NAAQS, states with nonattainment areas are required to submit SIP revisions that provide for, among other things, attainment of the NAAQS within certain prescribed periods that vary depending on the severity of nonattainment. Areas classified as Severe-15 must attain the NAAQS within 15 years of the effective date of the nonattainment designation. 7

In California, the California Air Resources Board (CARB) is the agency responsible for the adoption and submission to the EPA of California SIPs and SIP revisions, and it has broad authority to establish emissions standards and other requirements for mobile sources. Local and regional air pollution control districts in California are responsible for the regulation of stationary sources and are generally responsible for the development of regional air quality plans. In the West Mojave Desert, two agencies develop and adopt air quality management plans to address CAA planning requirements applicable to that region, the Antelope Valley Air Quality Management District (AVAQMD) and the Mojave Desert Air Quality Management District (MDAQMD) (collectively, “Districts”). Such plans are then submitted to CARB for adoption and submittal to the EPA as revisions to the California SIP.

The West Mojave Desert is located in northeast Los Angeles County and southwest San Bernardino County. For a precise description of the geographic boundaries of the area, see 40 CFR 81.305. The Los Angeles County portion of the WMD area is under the jurisdiction of the AVAQMD, and the San Bernardino County portion of the area is under the jurisdiction of the MDAQMD.

The population of the West Mojave Desert is approximately 868,380. 8 Ambient 8-hour ozone concentrations in the WMD are above the level of the 2008 8-hour ozone NAAQS. The area's maximum design value for the 2017-2019 period, based on certified data at the Phalen monitor (Air Quality System ID: 06-071-0012), is 0.096 ppm. 9

The West Mojave Desert receives significant transport of ozone and ozone precursors from the South Coast Air Basin, and to a lesser extent, the San Joaquin Valley. To attain the 2008 ozone NAAQS, the WMD will depend on continued emissions reductions in those areas. 10

States must implement the 2008 ozone standards under title I, part D of the CAA, which includes sections 171-179B of subpart 1, “Nonattainment Areas in General,” and sections 181-185 of subpart 2, “Additional Provisions for Ozone Nonattainment Areas.” To assist states in developing effective plans to address ozone nonattainment problems, in 2015 the EPA issued a SIP Requirements Rule (SRR) for the 2008 ozone standards (“2008 Ozone SRR”) that addresses requirements for nonattainment areas, such as attainment dates, emissions inventories, attainment and reasonable further progress (RFP) demonstrations, and the transition from the 1997 8-hour ozone standards to the 2008 8-hour ozone standards and associated anti-backsliding requirements. 11 The 2008 Ozone SRR is codified at 40 CFR part 51, subpart AA. We discuss each of the CAA statutory and regulatory requirements for 2008 8-hour ozone plans in more detail in Section III of this document.

The EPA's 2008 Ozone SRR was challenged, and on February 16, 2018, the U.S. Court of Appeals for the D.C. Circuit (“D.C. Circuit”) published its decision in South Coast Air Quality Management District v. EPA (“ South Coast II ”)  12 vacating portions of the 2008 Ozone SRR. The only aspect of the South Coast II decision that affects this proposed action is the vacatur of the alternative baseline year for RFP plans. More specifically, the 2008 Ozone SRR required states to develop the baseline emissions inventory for RFP plans using the emissions inventory for the most recent calendar year for which states submit a triennial inventory to the EPA under subpart A of 40 CFR part 51, “Air Emissions Reporting Requirements,” which was 2011. The 2008 Ozone SRR, however, allowed states to use an alternative year, between 2008 and 2012, for the baseline emissions inventory, provided the state demonstrated why the alternative baseline year was appropriate. In the South Coast II decision, the D.C. Circuit vacated the provisions of the 2008 Ozone SRR that allowed states to use an alternative baseline year for demonstrating RFP.