OPM is proposing to revise its regulations for the Pathways Programs. The proposed rule will clarify and update information on a variety of issues including reporting requirements, eligibility requirements, training requirements for Internship positions, and rotational assignments for Presidential Management Fellows. The proposed rule will also make changes to the public notification requirement for appointing Interns and Recent Graduates. Additionally, we propose to make several technical corrections to remove references to the former Student Career Program. OPM also invites feedback on potential modifications to several aspects of this rulemaking.

OPM is adopting a 45-day comment period to balance the need for robust public comment with agencies' operational considerations regarding the timing for students and recent graduates recruitment and hiring. The traditional agency recruiting season for early career talent, including interns, begins as early as winter to allow for internships to begin in the spring/summer. Agencies also start extending offers for full-time positions in the spring to students who expect to graduate in the summer. Prospective interns and job applicants frequently choose between numerous offers and opportunities in the winter and spring; agencies can maximize their chances of attracting and hiring great candidates if their recruiting and hiring activities are strategically timed. Applicants also benefit from having greater certainty about employment decisions as soon as possible.

To allow agencies a reasonable amount of time to modify their practices by the effective date of the final rule, OPM aims to review public comments on this proposed rule and make any necessary modifications expeditiously.

The Pathways Programs were established on December 27, 2010, with the issuance of E.O. 13562 (75 FR 82585) pursuant to 5 U.S.C. 3301 and 3302. The programs are designed to provide students and recent graduates with the opportunity for Federal internships and potential careers in the Federal Government through three components.

• The Internship Program exposes current high school students, undergraduate students, including those enrolled in community and technical colleges, and graduate students to the work of government by providing paid opportunities to work in agencies and explore Federal careers while still in school.

• The Recent Graduates Program (Recent Graduates) provides opportunities for individuals who have received qualifying degrees or certificates within the previous two years (up to six years for qualifying veterans) to obtain entry-level developmental experience designed to lead to a career in the Federal Government after successfully completing the Program, which is generally one year in length and in certain cases may be two years in length.

• The Presidential Management Fellows Program (PMF) promotes careers in the Federal Government by offering leadership development opportunities to individuals who have received advanced degrees within the preceding two years.

The Pathways Programs became effective on July 10, 2012. 1 In the final implementing regulations, OPM identified five core principles shared by each of the programs to advance merit system principles and the policies established by the President in E.O. 13562:

(1) Transparency—In an effort to promote transparency, agencies have to provide OPM with information about Internship Program and Recent Graduates Program opportunities and how interested members of the public can apply so that OPM can inform potential applicants. OPM designated USAJOBS, a website used to announce Federal jobs in the competitive service, for the purpose of notifying the public of these opportunities and how to apply at each agency. For the PMF Program, OPM itself publishes the vacancy announcement in USAJOBS. Under the discontinued Federal Career Intern Program (FCIP) and previous student programs, public notice using USAJOBS was not required, which created the appearance of restrictive, rather than open, recruitment practices.

(2) Limited Scope—Agencies are to use the Pathways Programs as part of an overall workforce planning strategy to supplement competitive examining, rather than a substitute for it. If agencies are not using the hiring authorities as intended, OPM may place caps on the number of individuals who may be initially appointed to or converted from Pathways positions to positions in the competitive service.

(3) Fairness to Veterans—The Pathways Programs honor and protect the rights of veterans in the Federal hiring process. Veterans' preference rules in the excepted service governed by sections 3308-3318, title 5, U.S.C. pursuant to section 3320, apply to Pathways positions through the application of part 302 of OPM's regulations in title 5 of the CFR. Veterans also have greater flexibility in meeting eligibility requirements for the Recent Graduates Program in that those unable to apply due to military service obligations have up to six years from the date they completed their educational programs to apply, whereas non-veterans must apply within two years of completion. This flexibility, along with providing public notice and safeguarding veterans' preference, helps ensure the hiring process is fair and veteran-friendly.

(4) Agency Investment—To meet the training and developmental requirements for the Pathways Programs, especially for the Recent Graduates and PMF Programs, agencies must commit resources to foster a positive experience that will help prepare their Pathways hires for potential conversion to the competitive service and success in their careers as Federal employees.

(5) OPM Oversight—To use the Pathways Programs, agencies must enter into Memoranda of Understanding (MOUs) with OPM and report to OPM annually on their use of the Pathways authorities. Agencies are also subject to any caps OPM may place on initial appointments or conversions to positions in the competitive service. In addition, the use of Pathways Programs is subject to evaluation by OPM or the agency as part of its independent audit program.

In general, these five principles, as outlined in the 2012 implementing regulation, are retained throughout this proposal. However, OPM invites comments on whether we should consider modification to, or addition to, these principles.

The Federal Government benefits from a diverse workforce that includes students and recent graduates, who contribute enthusiasm, talents, and unique perspectives. OPM assessed the Pathways regulations to consider the need for changes to make the regulations better advance the goals of E.O. 13562. It has also received substantial input from agencies that utilize Pathways.

In August 2016, OPM published a special report titled, “The Pathways Programs Their Use and Effectiveness Two Years After Implementation.”  2 This report documents a study OPM performed in fiscal year (FY) 2015 to determine how the Programs were being used and whether they were operating within the spirit and intent of the five core principles OPM identified in its implementing regulations: transparency, limited scope, fairness to veterans, agency investment, and OPM oversight. Additionally, OPM analyzed agencies' usage, highlighted notable practices, identified challenges and compliance concerns, and developed recommendations for improvement in the effective and efficient use of the Pathways Programs.

OPM has received qualitative feedback directly from agencies since the Programs' implementation. Between FY 2012 and FY 2016 OPM hosted monthly office hours meetings with agencies. During these office hours OPM and agencies discussed solutions and recommendations to challenges agencies encountered when using the Programs. Pathways Programs Officers and Presidential Management Fellows (PMF) Coordinators have and continue to contact OPM directly for advice and guidance on using the Programs since their inception. The Chief Human Capital Officers Council convened a working group to discuss challenges, issues, and successes of using the Pathways Programs during FY 2019. The working group also provided OPM staff with a number of ideas and recommendations for ways that the Programs could be improved.

Based on agency feedback and OPM's own analysis, we are proposing several changes aimed at enhancing the robust usage of the Pathways Programs as a key source of early career talent in the Federal Government, as a supplement to, and not a substitute for, the competitive hiring process. Overall, the purpose of this proposal is to streamline the Pathways regulations, making it easier for agencies to recruit and hire Pathways program participants, and to optimize the Pathways program as a tool to recruit and retain diverse and highly-qualified early career talent. The proposed changes, which are explained in greater detail below, cover a variety of issues related to the way agencies use the Pathways Programs to recruit and hire students and recent graduates including:

• Outlining the specific responsibilities of the Presidential Management Fellows (PMF) Coordinator;

• Expanding the time period for converting Pathways Interns from 120 to 180 days;

• Modifying the public notice requirement for vacancy announcements for Pathways Interns and Recent Graduates;

• Clarifying and streamlining the training and development requirements;

• Allowing Recent Graduate and Presidential Management Fellows participants to be converted to term or permanent positions in any agency, when appropriate;

• Clarifying the time period for required reporting;

• Allowing the use of part-time work schedules for PMFs in certain situations;

• Clarifying information about the use of developmental assignments for PMFs; and

• Expanding eligibility for the Recent Graduates Program to include those who have completed certain career or technical education programs.

In addition to seeking comment on the proposed changes summarized above and discussed in greater detail throughout, please see the Request for Comment and Data section below for additional requests for data and additional comments on specific topics.

OPM is proposing to modify the regulations in 5 CFR 300.301(b) to allow agencies to detail employees appointed under the Pathways Programs (Schedule D of the excepted service) to positions in the competitive service without approval from OPM. Current regulations under Schedule A, Schedule B, or the Veterans Recruitment Appointment authority allow an agency to detail an employee in an excepted service position under those authorities without approval from OPM. Prior to the creation of the Pathways Programs, both the former Student Education Employment Program (SEEP) and the predecessor to the PMF Program were a part of Schedules A and B of the excepted service. However, the Pathways Internship Program, which replaced the SEEP, and the PMF Program are now filled under Schedule D of the excepted service, which currently requires OPM approval for details to the competitive service. OPM is proposing to modify the Schedule D regulations to allow agencies to detail Pathways employees to positions in the competitive service without approval from OPM, similar to how details were executed under the SEEP.

OPM is proposing to revise the definition of an advanced degree and certificate program in § 362.102. We are proposing that the definition of advanced degree be revised to mean a master's degree, professional degree, doctorate degree, or other formal degree pursued after completing a bachelor's degree. We believe that the revised definition may lead to less confusion among applicants and agencies about the types of degrees required for eligibility under the Pathways Programs. We are proposing to revise the definition of a certificate program to include a qualifying career or technical education program that awards a recognized postsecondary credential or industry-recognized credential.

OPM is also proposing to add definitions for terms related to career and technical education. These terms are: certificate of completion of a Registered Apprenticeship Program; industry-recognized credential; qualifying career or technical education program; recognized postsecondary credential; and Registered Apprenticeship Program. These definitions are being proposed as a part of the proposed changes to the eligibility criteria for the Internship and Recent Graduate Programs, as discussed more extensively in the Supplemental Information related to § 362.302.

We are proposing to define certificate of completion of a Registered Apprenticeship Program to mean documentation ( i.e., an official record) given to an individual who has successfully completed a registered apprenticeship program (29 CFR parts 29 and 30).

The term career or technical education program is used in section 3 and section 4 of E.O. 13562 but is not currently defined in the regulation. We are proposing to define qualifying career or technical education program to mean:

• An organized educational program, administered through a Federal agency, that focuses on providing rigorous academic content and relevant technical knowledge and skills needed to prepare the individual for further education and a career in a current or emerging profession and provides technical skill proficiency, and a recognized postsecondary credential (which may include an industry-recognized credential, a certificate, or an associate degree); or

• A Registered Apprenticeship Program; or

• Service in a federally administered local, state, national, or international volunteer service program or organization designed to give individuals work and or educational experiences in volunteer programs that benefit the Federal Government or local communities.

This proposed definition is based in part on the definition found in 20 U.S.C. 2302(5). Examples of eligible programs would include the Department of Labor Job Corps programs, Registered Apprenticeship Programs, the Peace Corps, and AmeriCorps.

We are proposing to define industry-recognized credential as either a certificate or credential developed and offered by, or endorsed by, a nationally- or regionally recognized industry association or organization representing a sizeable portion of the industry sector, or credential that is sought or accepted by companies within the industry sector for purposes of hiring or recruitment, which may include credentials from vendors of certain products.

We are proposing to define recognized postsecondary credential to mean documentation of an industry-recognized certificate or certification, a certificate of completion of a Registered Apprenticeship Program, a license recognized by the State involved or Federal Government, or an associate or baccalaureate degree. This proposed definition is based on the definition found in 29 U.S.C. 3102(52). Our intent in incorporating these definitions is to provide agencies clarity that both career and technical education programs and industry recognized credentials, as defined herein, are suitable demonstrations of relevant experience for Pathways purposes.

We are proposing to define Registered Apprenticeship Program as a program that meets the requirements in 29 CFR part 29. Approval of registration would be evidenced by a Certificate of Registration or other written documentation as provided by the respective career or technical education establishment. This proposed definition would align with DOL regulations.

We are proposing these changes based on the authority given to OPM in E.O. 13562 to promulgate regulations for the implementation and use of the Pathways Programs and the statutory authority in 5 U.S.C. 3301 and 3302.

Currently, an agency must execute a memorandum of understanding (MOU) with OPM before using the Pathways Programs. The original Pathways regulations contained this requirement because the MOU was the mechanism for OPM to obtain from agencies a listing in advance of the positions the agencies intended to fill through Pathways Programs. The MOU requirement allows for OPM to play a role in considering and approving those positions, a key oversight safeguard that promotes the use of these programs as supplements to, and not substitutes for, competitive hiring. OPM is proposing to replace the use of an MOU with a requirement that an agency must have a Pathways Policy in accordance with § 362.104 in order to make appointments under the Pathways authority. Similar to the MOU, the agency policy will outline the parameters under which the agency will use the Pathways Programs. In lieu of the MOU, OPM will tie oversight to agency compliance with its Pathways Policy in revised § 362.108(b)(1). OPM may limit an agency's use of this authority if we determine the agency is not in compliance with its Pathways Policy in accordance with revised § 362.104, or E.O. 13562 in general. This proposed change will do what the MOU would otherwise require, and we think it is an appropriate modification based on 10 years of experience overseeing the Pathways Programs that will streamline administration.

If this proposed change is adopted, each agency would be required to submit a copy of its Pathways Policy to OPM within 120 days of the effective date of the final rule. Once approved, the submission of an updated policy would only be required when the agency made substantive or significant changes to the policy. This is in line with how OPM approves delegated examining for agencies in the regular competitive hiring process. Agencies with existing Pathways MOUs  3 may continue to use the Pathways Programs subject to the new regulations in lieu of an updated Pathways Policy while they are developing and updating their policies in accordance with the new regulations. Agencies without existing MOUs must submit a copy of their agency Pathways Policy before they begin making Pathways appointments.

OPM is also proposing to clarify the role of the Presidential Management Fellows Coordinator in § 362.104(a)(8) to outline the specific responsibilities of the role. We have found that there is inconsistency in the importance that agencies place on this role. The PMF Program is the premier leadership development program for the Federal Government. Each year, the best qualified candidates are selected through a rigorous assessment process. Then, the PMF finalists apply for placement to PMF-designated positions at Federal agencies. But placement rates vary year-to-year, and many years, hundreds of finalists do not get placed. Moreover, for those who are placed in agencies, the experience varies widely, as some agencies are more highly invested in the professional development of their PMFs. By bolstering the role of the PMF Coordinator, OPM seeks to offer agencies a better way to share information about the PMF Program throughout agencies and standardized practices associated with the use of the Program. This increased communication and added consistencies in practice may help agencies place more PMF finalists and provide a more positive developmental experience for those finalists who get placed. Accordingly, we are proposing that an agency must have at least one PMF Coordinator in a position at the agency's headquarters, in a position at or higher than grade 12 of the General Schedule (GS) or other equivalent pay and classification system. In addition, OPM recommends building the capacity within agencies, by designating PMF Coordinators at the headquarters level of a departmental component or sub-agency level. Additionally, we are proposing that the PMF Coordinator will be responsible for administering the agency's PMF Program including coordinating the recruitment of PMF finalists, coordinating and overseeing the on-boarding and certification processes for PMF Program Participants, coordinating the agency's PMF Program plan to ensure it is integrated with agency-wide workforce plans, and reporting to OPM on the agency's implementing of its PMF program. If an agency chooses to use more than one PMF Coordinator, at least one must be at the headquarters level and in a position at the GS-12 level or higher. If an agency designates multiple PMF Coordinators, they must work collaboratively to administer the agency's PMF Program. For example, a large agency may have a GS-12 PMF Coordinator at the headquarters level and additional coordinators in the component level offices may be at whatever grade level the agency finds appropriate.

OPM is proposing to revise § 362.107(c)(2) to allow a Recent Graduate, who has successfully completed program requirements, to be converted to a position in the competitive service within the employing agency or another agency within the Federal Government. This change will provide agencies additional flexibilities to capitalize on the Federal Government's investment in training and development of a Recent Graduate when the employing organization has determined resource restrictions prevent the agency from converting a Recent Graduate to a permanent or term position within the agency.

OPM continues to expect an eligible Recent Graduate to convert to a position at the agency that hired them as a Recent Graduate (either in the organization in which they are employed, or another component within the same Department or agency) before the Recent Graduate may convert to a different Department or agency. Indeed, agencies who hire Recent Graduates are required to have engaged in sufficient strategic workforce planning to allow for a plan to convert the Recent Graduate to a permanent position in the agency upon successful completion of the program. This is an important safeguard to protect against the possibility of agencies becoming overly reliant on Recent Graduates who cycle through every few years but never land permanent positions with the agency.

Nonetheless, it is reasonable to expect that an agency may encounter obstacles that prevent conversion within the agency. For example, unforeseen budgetary constraints may affect the agency's ability to convert the Recent Graduate. New priorities brought about by a new law or policy could require agencies to shift resources and focus away from the jobs to which the Recent Graduate is eligible to convert. OPM believes that, given the nature of such unexpected obstacles, it is in the interests of efficient and effective administration of the civil service to provide for opportunities for Recent Graduates who have successfully completed their program and meet the requirements for conversion to be able to convert at agencies other than the one that initially hired them as a Recent Graduate. Such conversion can occur for any position for which the Recent Graduate is qualified and at the grade level to which the Recent Graduate would have been converted within the agency that appointed them had the opportunity been available. The position in another component of the same agency or at the new agency must have a full performance level that is equivalent or less than the position at the prior agency. The initial agency has invested in the development of the Recent Graduate and, if it is unable to convert them, other agencies should have that opportunity so that the investment in the Recent Graduate is not lost to the Federal Government. OPM proposes that the employing agency should determine within a reasonable period of time ( e.g., 90 to 120 days before conversion deadline) whether or not they intend to convert the Recent Graduate to a position in either the component or the broader agency. If the agency is unable to convert the eligible Recent Graduate, then the Recent Graduate may be converted to a position in a different agency.

We welcome comments on how to balance an agency right of first refusal in converting their Recent Graduates with Recent Graduates choosing whether to convert if there are opportunities at other agencies. We are also interested in comments on whether conversion at other agencies should be limited to situations where the employing agency is unable to convert due to a lack of resources or if conversion should occur at another agency for any reason. Comments in favor of conversion at another agency for any reason should address the types of reasons or situations where conversion at another agency may be allowed.

For the same reasons stated above with respect to eligible Recent Graduates, OPM is also proposing to allow eligible Presidential Management Fellows to be converted to a position in the competitive service either within the employing agency or at another agency within the Federal Government. For reader clarity we are proposing to move the revised provision on PMFs to proposed § 362.107(c)(3).

OPM is proposing to revise § 362.108 by amending § 362.108(b)(1) to remove the reference to an MOU and replace it with a reference to the agency's Pathways Policy in accordance with the proposed change at § 362.104 described above.

The regulations in § 362.109 require agencies to provide OPM with information on workforce planning strategies and their use of the Pathways Programs on an annual basis. OPM is proposing to clarify this requirement by modifying § 362.109 to indicate that reporting is required on a fiscal year basis. OPM proposes starting the updated requirement in FY 2024 because that is the target fiscal year for publication of the final rule. In addition, since FY 2010, OPM has required reporting on an annual basis. Because the Pathways rules and programs have been effective since that time and OPM receives regular feedback on these programs on an on-going basis, we believe a 3-year reporting cycle is more appropriate and will reduce any administrative burdens this requirement may present to agency Pathways users. Accordingly, we are proposing to modify the reporting requirement to once every three years, i.e., beginning in FY 2024 and then again in FY 2027, and so on.

Severability is an important remedial doctrine that arises in cases challenging the legality of statutes and agency rules. When reviewing a rule, if a court determines that a particular provision is unlawful, severability addresses whether judicial relief should extend to the entire rule or whether it can be limited to the invalid provision, leaving in effect the remainder of the rule. 4 OPM is proposing to add a new § 362.11 to address the issue of severability. OPM intends and expects that if any part or section is held to be invalid or unenforceable as applied to any person or circumstance, that part or section shall be construed so as to continue to give the maximum effect to the provision permitted by law, including as applied to persons not similarly situated or to dissimilar circumstances, unless such holding is that the provision is invalid and unenforceable in all circumstances, in which event the provision shall be severable from the remainder of this Part and shall not affect the remainder thereof. We have come to this determination because the Pathways Programs encompassed three discrete programs with different implementing provisions. Should provisions related to one of the programs be held to be invalid we believe that the other programs should be severable and would not be impacted.

OPM is proposing to include a definition for Intern not-to-exceed (Intern NTE). We are proposing this change because it is the general way that Interns and agencies refer to Interns who have been appointed for an initial period of up to one year.

OPM is also proposing to modify the definition of student to include individuals enrolled or accepted for enrollment in a qualifying career or technical education program. We are proposing this change to make the Pathways Internship Program more inclusive of individuals in career or technical education programs that award a post-secondary certification or credential. Eligible career or technical education programs would include programs such as Registered Apprenticeship programs and the Job Corps programs. Section 3 of E.O. 13562 states that the Internship Program shall provide opportunities for, “. . . students in high schools, community colleges, 4-year colleges, trade schools, career and technical education programs, and other qualifying educational institutions and programs, as determined by OPM . . .”. Consistent with the direction in E.O. 13562, OPM has determined that career and technical education programs that provide a recognized post-secondary credential such as Registered Apprenticeships and Jobs Corps programs meet the criteria of career and technical education programs expressed in E.O. 13562.

Since the implementation of the Pathways Internship Program in 2012, OPM, through administrative guidance, has required that agencies must post internship positions on USAJOBS.gov before filling these positions. Over the years, agencies have noted that this requirement can substantially lengthen the hiring process and can hinder agencies' ability to effectively recruit and retain early career talent. Therefore, OPM is proposing changes to this requirement to give agencies greater flexibility to recruit and retain early career talent and therefore to advance the goals of E.O. 13562. It should be noted that the flexibility to recruit in an efficient manner must be balanced with the agency's responsibility to uphold fair and open competition.

OPM proposes that agencies can meet the public notice requirement in one of two ways: (1) posting a searchable announcement on www.USAJOBS.gov, as is currently required; or (2) posting job information on the agency's public facing career or job information web page with a link to a USAJOBS custom posting.

With respect to this second option, a USAJOBS custom posting generates a unique URL that agencies can use for the job announcement. An agency can create a custom job posting in its talent acquisition system (TAS). OPM will have the posting stored within USAJOBS, and therefore can use USAJOBS to collect applicant data analytics for trend reporting and applicant flow data purposes, but the custom job posting will not appear in USAJOBS searches. Therefore, to facilitate applicants' access to these internship opportunities, OPM will provide a centralized source through which applicants can be directed to the locations on agency-specific web pages where applicants can learn about these opportunities.

For either of these two options—either a searchable announcement on USAJOBS or a link to a USAJOBS custom posting on the agency's public career or job information web page—agencies can promote the job posting on third party websites and recruitment boards or recruiting platforms, social media platforms, in trade publications, and at college and university events.

OPM is proposing these changes to assist agencies in their recruitment and retention efforts and as informed by the public notification requirements provided in recent statutory changes for early career hiring authorities for Post-Secondary Students and College Graduates (5 U.S.C. 3116 and 3115). OPM specifically invites comments regarding these changes and whether they will assist agencies and ultimately improve the hiring experience for Interns and Recent Graduates, thereby better advancing the purposes of E.O. 13562.

OPM is proposing to revise § 362.203(d) to remove the reference to an MOU and replace it with a reference to the agency's Pathways Policy. The conforming change is necessary due the proposed change in § 362.104 described above.

Both agencies and employees have asked for clarity on the ability of an agency to promote Interns. Eligibility for promotion is determined based on the type of appointment given. Employees on temporary appointments (initial appointments of not-to-exceed one year) are not eligible for promotions. Employees on non-temporary appointments (initial appointments of more than one year made without a not-to-exceed date) are eligible for promotion. For this reason, we are revising § 362.203(e) to reflect that those Interns whose appointments are expected to last more than one year without a not-to-exceed date may be promoted when they meet the qualification requirements for a higher graded position. The change also provides that Interns NTEs (on temporary appointments not-to-exceed one year) are not eligible for promotions.

Agencies participating in the Pathways Internship Program are required to provide Interns with meaningful developmental work and set clear expectations regarding the work experience of the Intern as indicated in § 362.104. Identifying and allowing Interns to participate in training opportunities such as job training activities, formal training classes, mentoring sessions, testing products or tools, organizing work activities or functions, and assisting colleagues with projects or tasks will help ensure that Interns have meaningful work experiences that will help to adequately prepare Interns for Federal service. For this reason, we are proposing to modify the regulations at § 362.203 by adding a new paragraph (i) that requires agencies to provide Interns with meaningful onboarding activities and training and development opportunities. Agencies should document training information using training plans, Individual Development Plans (IDP) or the Pathways Participant Agreement. Appropriate training opportunities may include but are not limited to on-the-job training activities, formal training classes, mentoring sessions, testing products or tools, organizing work activities or functions, and assisting colleagues with projects or tasks.

Currently, agencies must convert an Intern to a permanent position in the competitive service within 120 days of the Intern's completion of a degree and the program requirements. Agencies have indicated that they face challenges in completing additional background investigations and adjudications that may be required to encumber the position following conversion. OPM is proposing to extend this time for conversion from 120 calendar days to 180 calendar days in § 362.204(b)(2). Though we are extending the timeline to assist agencies and Interns in securing conversion, we continue to urge agencies to move promptly to complete conversion upon the Intern's completion of the degree or qualifying career or technical education program and program requirements. Lengthy delays in conversion can pose a financial hardship on the Intern and lead to them seeking employment elsewhere.

Currently, an Intern must complete a minimum of 640 hours of work experience while in the Internship Program to be eligible for conversion. Under § 362.204(c) an agency may credit time served in comparable non-Federal Internships, in which an Intern is working in, but not for, a Federal agency, for up to half of that time (320 hours) when that service occurred prior to an Internship appointment. OPM proposes to modify the provisions in § 362.204(c) to allow agencies to also credit time served in a Registered Apprenticeship Program at a Federal agency prior to the appointment as an Intern toward the 640-hour requirement. As with the time served in non-Federal internships, time served in Registered Apprenticeship Program can count for up to half of the minimum 640 hours. We are also proposing that an agency may count time spent in a Department of Labor Job Corps program, prior to appointment as an Intern, toward the 640-hour work requirement. It is important to note that all time served by participants in Registered Apprenticeship Programs or Job Corps Programs (after the publication of the final rule) while appointed as a Pathways Intern will be creditable toward the 640-hour requirement as allowed by § 362.204(b). This provision for crediting time toward conversion would only be needed for those Interns who may have participated in a Registered Apprenticeship Program or Job Corps program prior to a current Intern appointment where eligibility was based on enrollment in a subsequent qualifying program after completing the Registered Apprenticeship Program. For example, an Intern currently enrolled in a bachelor's degree program has completed 320 work hours as an Intern prior to completing her degree. The Intern had participated in a Registered Apprenticeship Program at a Federal agency two years before their appointment as an Intern. Up to 320 hours from the prior Registered Apprenticeship Program may be credited toward the 640-hour requirement.

OPM invites comments on other ways to strengthen the provisions that agencies may credit or waive up to 320 hours toward an Intern's 640-hour service requirement.

OPM is proposing to change the provision for termination of an Intern appointment from 120 days after completion of a degree to 180 days after the completion of a degree. This conforming change is necessary based on the proposed change in § 362.204(b)(2) pertaining to the conversion window described above.

We are also proposing to make conforming changes in this section to incorporate the new term Intern NTE.

OPM is proposing to revise § 362.301(a) to remove the reference to an MOU and replace it with a conforming reference to the agency's Pathways Policy in accordance with the proposed change at § 362.104.

One objective of E.O. 13562, as stated under section 1, is to enable the Federal Government to “compete effectively” for talent and avoid “being at a competitive disadvantage compared to private-sector employees when it comes to hiring qualified applicants for entry level positions.” In the years since the creation of the Pathways Programs, employment trends in other sectors have shifted to better recognize the value of and utilize skills-based hiring over reliance on degrees. The Governors of Colorado, 5 Alaska, 6 and Pennsylvania  7 among others, have issued Executive orders to promote skills-based hiring for state government jobs and reduce or eliminate degree requirements. According to a Burning Glass Institute report, major companies in the technology services field are dropping degree requirements for a significant share of their entry-level and above positions. 8 Federal policies have also started to change, as demonstrated by E.O. 13932 of June 26, 2020, Modernizing and Reforming the Assessment and Hiring of Federal Job Candidates, which directed the Federal Government to increase its use of skills-based hiring to fill positions. Consistent with E.O. 13562's objective of enabling the Federal Government to compete effectively for qualified applicants to fill entry-level positions under current workforce and job marketplace conditions, OPM is proposing to modify the eligibility criteria for the Recent Graduate Program in § 362.302 to include individuals who have completed a career or technical education program.

The current regulation includes a definition of the term “qualifying educational institutions” under § 362.102 but does not include a definition of “qualifying career or technical education program.” As noted in the discussion of § 362.102, we are proposing a definition of career or technical education programs to include programs such as Registered Apprenticeship Programs, the Department of Labor-administered Job Corps, the Peace Corps, and AmeriCorps. Individuals who have completed such career or technical education programs, much like college graduates who have graduated from a qualifying educational institution, may be at a disadvantage for competitive service hiring, as they lack significant previous work experience. See E.O. 13562, Sec. 1 (noting that existing competitive hiring process favors job applicants who have significant previous work experience and therefore finding it necessary to create an excepted hiring authority for the Pathways Programs).

OPM has specifically identified four Federal programs that meet the criteria under this definition of “qualifying career or technical education program”: Registered Apprenticeship Programs, the Department of Labor-administered Job Corps Programs, the Peace Corps, and AmeriCorps. Graduates and alumni from these programs are uniquely positioned to apply for Federal positions because they have been accepted into a government-administered program that is regulated by specific standards, and the Federal Government has already invested funding and personnel resources toward their success. Many of these participants have been pre-screened with background checks or investigations before joining these programs, and they have already demonstrated an inclination toward government service through their participation. Additionally, these programs attract more diverse participants relative to the broader U.S. workforce and creating a more robust applicant pipeline from these programs to Pathways Programs would help further the objective of E.O. 13562 to draw from all parts of American society. OPM believes that overtly defining this term will assist agencies as they seek to access additional talent pools that they can draw upon to meet their missions.

OPM invites comments regarding the inclusion of career and technical education programs in the eligibility criteria for the Recent Graduate Program. OPM is particularly interested whether we should establish restrictions or criteria for the types of programs that would meet the eligibility criteria.

For the reasons discussed above regarding § 362.203, OPM is proposing to revise § 362.303(a)—the job posting requirements for Recent Graduates—in the same manner as has been proposed for Interns in § 362.203(a). OPM believes that these changes will enable agencies to better recruit and retain early career talent and therefore advance the goals of E.O. 13562. OPM invites comments on these changes, as discussed above.

OPM is proposing to revise § 362.303(b)(1) and (c) to remove the reference to an agency's MOU and replace it with a reference to the agency's Pathways Policy. The conforming change is necessary due the proposed change in § 362.104.

OPM's qualification standards for white collar jobs allows education alone to be qualifying for non-research positions at the GS-11 level and below. The standards also allow education alone to be qualifying at the GS-12 level for research positions. For this reason, OPM is proposing to revise § 362.303(b)(i) to allow initial appointments of a Recent Graduate to any position filled under the authority up the GS-11 level. The existing provisions in the regulations to allow appointments at the GS-12 level for research positions in § 362.303(b)(iv) remains unchanged.

OPM is proposing to modify § 362.305 to permit conversion to a term or permanent position in a different agency. The proposed change adds a new paragraph (c) which provides that conversion at a different agency may only occur when the employing agency documents it is unable to convert the Recent Graduate. An agency may determine that it is unable to convert the Recent Graduate for reasons related to a lack of available positions for which the Recent Graduate is qualified due to unforeseen funding or budgetary constraints or limitations, reorganizations, abolishment of positions, or other appropriate reasons. It is important to note that a Recent Graduate is not entitled to conversion at the employing agency or another agency. Conversions may only be offered to those Recent Graduates who have successfully completed the Recent Graduate Program requirements and demonstrated successful job performance resulting in a rating of record (or summary rating) of at least Fully Successful or equivalent and have a recommendation for conversion from the first level supervisor. Recent Graduates who do not meet these criteria or have misconduct issues or unsuccessful performance may not be converted to a position in the employing agency or another agency. Additionally, such a conversion must occur on or before the end of the agency prescribed Program period, plus any agency-approved extension, and the position at the new agency must have a career ladder or full promotion potential that is the same or lower than the position at the former agency.

OPM is proposing to revise the definition of Agency PMF Coordinator in § 362.401. This conforming change is necessary due to the proposed change in § 362.104(a)(8).

OPM is proposing to revise § 362.404(a)(1) and (b) to remove the references to an agency's MOU and replace it with a reference to the agency's Pathways Policy. This conforming change is necessary due to the proposed change in § 362.104.

Presidential Management Fellows (Fellows) are generally given full-time work schedules. However, there are times when an agency may need the flexibility to offer a part-time work schedule to Fellows for limited periods of time. For example, as a reasonable accommodation due to a medical condition, illness, or injury, or caregiving responsibilities for family members, an agency could authorize a part-time work schedule for a period of 3 to 6 months while the Fellow recovers. For this reason, OPM is proposing to modify § 362.404 by adding paragraph (e) to provide agencies with the discretion to authorize a part-time work schedule for limited period of up to 6 months during the program if the agency and Fellow have determined that it would not negatively impact the Fellow's ability to meet all program requirements by the expiration of the Fellow's appointment. An agency is not required to approve a part-time schedule. When a part-time schedule is being approved, it should be approved for the shortest amount of time necessary because the Fellow must complete all program requirements within the two-year program period and any approved extension. In situations where the Fellow may have entitlements under the Family Medical Leave Act, the use of a part-time work schedule may supplement those entitlements.

Currently, § 362.405(a) provides that a Fellow must (1) have an Individual Development Plan (IDP) in place within 45 days upon entering on duty, (2) have a Mentor in place within 90 days, and (3) be able to consult the Mentor in the development of the IDP. The different time frames for developing an IDP and identifying a mentor creates a situation where most Fellows do not have a Mentor in place prior to and during the initial development of their IDP. For this reason, we are proposing to modify § 362.405(a) to require an IDP within 90 days. This will allow the Mentor to participate in the development of the IDP with the Fellow and the manager. OPM encourages agencies and Fellows to identify Mentors and create IDPs as soon as practicable but no later than 90 days after the appointment.

OPM is proposing to modify § 362.405(b)(1) to reflect that OPM will provide leadership development activities and general program resources instead of an orientation program. Years of experience with the PMF program has led us to conclude that the agency-specific PMF orientation is far more valuable to individuals selected as Fellows than a centrally provided orientation program. Fellows are going to work for a particular agency. While there are centrally managed activities for Fellows, the employing agency is primarily responsible for the day-to-day activities of their PMF Fellow cohort. Fellows need to learn about their agency and where their job fits into it. Clarifying that agencies are responsible for PMF orientation—which many already are providing—reduces confusion between agencies and OPM about responsibilities and provides a better on-boarding experience for Fellows. OPM views its role as providing meaningful leadership development activities and resources throughout the program lifecycle. This proposed change will better reflect the reality of how the program is administered today, which is a model that will lead to a better on-boarding experience for Fellows.

Currently, § 362.405(b)(4)(i) requires agencies to provide for a minimum of one developmental assignment of 4 to 6 months' duration. It also allows that as an alternative to this developmental assignment Fellows may choose to participate in an agency-wide, Presidential or Administration initiative that will provide experience comparable to the developmental assignment. Fellows and agencies have found this description of an alternative to be confusing and duplicative. Accordingly, we are instead providing examples that we expect will assist agencies and Fellows alike. Specifically, we note that developmental assignments could include projects requiring implementation of a new Executive order, major piece of legislation, agency reorganization, or cross-agency collaboration on a major Administration initiative. Cross-agency collaboration on a new program or service, establishment of a new program or office, or drafting a report would be additional types of projects that could serve as a developmental assignment. We welcome further comment on other examples.

Agencies may also provide Fellows with an additional short term rotational assignment of up to 6 months. Over the years, Fellows and agencies have inquired about whether such assignments are limited to the employing agency or if they may also occur in other agencies. To clarify this matter OPM is proposing to revise § 362.405(b)(4)(ii) to indicate that short term rotational assignments may take place within the Fellow's organization, in another component of the agency, or in another Federal agency at the employing agency's discretion.

OPM is proposing to clarify the information about Executive Resource Board (ERB) certification of completion to indicate how certification relates to the eligibility for conversion in the current agency or a different agency. We are proposing to modify § 362.405(d)(2) and (4) to indicate that a Fellow who is successfully certified may be converted in accordance with § 362.409 and that a Fellow who is not approved for ERB certification is not eligible for conversion. This change is necessitated by the change in § 362.107 to allow the conversion of a Fellow in the employing agency or a different agency. The losing agency is responsible for the ERB certification.

OPM is proposing to modify in § 362.409 to allow conversion to a term or permanent position in a different agency. The proposed change adds a new paragraph (c), which would require that conversion at another agency is allowed only when the employing agency documents that there no available positions in the current organizational unit or elsewhere in the employing agency (including its various components) for which the Fellow is qualified. An agency may determine that it is unable to convert the Fellow for reasons related to a lack of available positions for which the Fellow is qualified due to unforeseen funding or budgetary constraints or limitations, reorganizations, abolishment of positions, or other appropriate reasons. It is important to note that a Fellow is not entitled to conversion at the employing agency or another agency. Conversions may only be offered to those Fellows who have successfully completed the PMF Program requirements including the performance and developmental expectations set forth in the Fellow's performance plan and IDP; and has received ERB-certification of completion. Fellows who do not meet this criteria or have misconduct issues or unsuccessful performance may not be converted to a position in the employing agency or another agency. The proposed change would also require that such conversion must occur on or before the end of the agency prescribed Program period, plus any agency-approved extension, and the position at the new agency must have a career ladder or full promotion potential that is the same or lower than the position at the former agency.

OPM welcomes comments on whether the employing agency should have priority in converting their Recent Graduates or Fellows or if, instead, the Recent Graduates or Fellows should be able to choose where to convert if there are opportunities at other agencies.

OPM is proposing to replace the outdated reference to the former Student Career Experience Program (SCEP) program in 5 CFR 10.306(c) with a reference to the Pathways Internship Program.

OPM is proposing these regulations to update the Pathways Programs to facilitate a better applicant experience, to improve developmental opportunities for Pathways Programs participants, and to streamline agencies' ability to hire Pathways Program participants and convert to permanent employment those that have successfully completed their Pathways requirements. Robust Pathways Programs with appropriate safeguards to promote its use as a supplement to, and not a substitute for, the competitive hiring process is essential to boosting the Federal Government's ability to recruit and retain early career talent.

The proposed rule modifies existing regulations for the Pathways Programs for hiring Interns and Recent Graduates and for the Presidential Management Fellowship Program. We anticipate that these changes will improve and enhance the effectiveness of the Pathways Programs consistent with E.O. 13562, which requires OPM to support agency use of programs to recruit students and recent graduates.

In fiscal year 2021, agencies made 8,039 new appointments using the Pathways Programs hiring authorities (4,873 Interns, 2,828 Recent Graduates and 338 Presidential Management Fellows). It is important to note that, while these proposed changes may enhance the way the agencies use the program, they are only one of several factors impacting whether the number of appointments made will increase or decrease. Other factors not addressed or impacted by these regulations such as agency resources available for hiring and recruiting will also need to be considered when evaluating the effectiveness of the programs in helping agencies reach their recruiting and hiring goals.

This proposed rule will affect the operations of over 80 Federal agencies—ranging from cabinet-level departments to small independent agencies. We estimate that this proposed rule will require individuals employed by these agencies to modify policies and procedures to implement the rule and perform outreach and recruitment activities when using the authority. For the purpose of this cost analysis, the assumed average salary rate of Federal employees performing this work will be the rate in 2022 for GS-14, step 5, from the Washington, DC, locality pay table ($143,064 annual locality rate and $68.55 hourly locality rate). We assume that the total dollar value of labor, which includes wages, benefits, and overhead, is equal to 200 percent of the wage rate, resulting in an assumed labor cost of $137.10 per hour.

In order to comply with the regulatory changes in this NPRM, affected agencies would need to review the final rule and update their policies and procedures. We estimate that, in the first year following publication of the final rule, this would require an average of 250 hours of work by employees with an average hourly cost of $137.10. This would result in estimated costs in that first year of implementation of about $34,275 per agency, and about $2,742,000 in total Governmentwide. We do not believe this proposed rule will substantially increase the ongoing administrative costs to agencies (including the administrative costs of administering the programs and hiring and training new staff). This is because the proposed rule is modifying existing programs and recruitment of students and recent graduates is an ongoing need.

The proposed changes will boost the Federal Government's ability to recruit and retain early career talent. For example, the proposed change to modify the public notice requirement will provide agencies with additional flexibility when recruiting and may also lead to a better applicant experience. The proposed changes to allow the conversion of eligible Recent Graduates and Presidential Management Fellows to competitive service positions in the employing agency or another agency will provide flexibility when resource restrictions would otherwise prevent conversion. When an agency is unable to convert the eligible Recent Graduate or Presidential Management Fellow the agency and the government lose the expertise and knowledge the participant has gained during the program. However, the opportunity for conversion at another agency may prevent that loss. The extension of the 120-day period for the conversion of Interns to 180 days provides agencies the benefit of being able to convert those interns who may have been separated when the background investigation or vetting process exceeded the 120-day limit.

Executive Order 14035 of June 25, 2021, Diversity, Equity, Inclusion, and Accessibility in the Federal Workforce, establishes an initiative on diversity, equity, inclusion, and accessibility (DEIA) in the Federal workforce. As part of OPM's work, a Government-Wide Strategic Plan to Advance Diversity, Equity, and Accessibility in the Federal Workforce was released in November 2021. 9 This plan directs agencies to prioritize a number of efforts to support sustainability and continued improvement on DEIA matters. This includes seeking opportunities to promote paid internships, fellowships, and apprenticeships. The proposed updates to the Pathways Programs will help inform and support agency efforts to use and promote paid internships.

E.O. 13562 authorized OPM to establish regulations to implement the Pathways Programs. Over the years OPM has issued guidance in addition to these regulations to assist agencies in using the Programs. However, the proposed changes in this notice of proposed rulemaking (NPRM) address issues that require a modification of the existing regulations and cannot be changed by guidance alone. For example, OPM believes that agencies need additional flexibility to convert participants in the Recent Graduate and PMF programs to positions in another agency. The existing regulations limit the conversion of Recent Graduate or PMF participants to positions in the employing agency. We have determined that a change to these regulatory provisions is required to provide the additional flexibility agencies requested.

In addition to the information contained in the regulatory analysis, OPM requests comment on whether to modify several aspects of this rulemaking. Such information will be useful for better understanding the impact of these regulations on hiring by Federal agencies. OPM welcomes the public's views on the following:

• Whether Recent Graduates and Presidential Management Fellows should be able to convert to positions at a different agency. OPM recognizes that agencies may encounter obstacles preventing the conversion of Recent Graduates and Presidential Management Fellows. OPM believes that given the nature of such unexpected obstacles, it is in the interests of efficient and effective administration to provide for opportunities for Recent Graduates and Presidential Management Fellows who have successfully completed their program and meet the requirements for conversion to be able to convert at agencies other than the one that initially hired them as a Recent Graduate. The initial agency has invested in the development of the Recent Graduate and Presidential Management Fellow and, if it is unable to convert them, other agencies should have that opportunity so that the investment in the Recent Graduate or Presidential Management Fellow is not lost to the Federal Government.

• Whether the employing agency should have a right of first refusal in converting their Recent Graduates and Presidential Management Fellows, as currently proposed, or if, instead, the Recent Graduates and Presidential Management Fellows should be able to choose where to convert if they have multiple offers.

• How could OPM structure the Pathways Intern conversion process to maximize the Federal enterprise's ability to recruit and retain qualified interns following the conclusion of their internship? Should OPM consider alternative conversion timelines ( e.g., greater than 180 days), alternative internship service requirements, alternative interagency conversion rules, or specific waiver/exception conditions?

• Whether the proposed public notice options for filling positions under the Internship Program and Recent Graduates Program will enable agencies to more effectively recruit and retain early career talent than the current process. In addition to allowing agencies to post searchable job opportunities at USAJOBS, OPM is also proposing to allow agencies to post job information with a link to a USAJOBS custom posting on their agency websites, with OPM providing a centralized place where applicants can be directed to those postings on the agency websites. OPM specifically invites comments on these changes and whether they will assist agencies with better advancing the purposes of E.O. 13562.

• Ways to strengthen the proposed provision that allows agencies to waive or credit up to 320 hours toward an Intern's 640-hour service requirement for these programs. OPM encourages commenters to provide examples of alternate criteria that could be used for the credit or waiver provisions. Are there practical considerations or specific waiver/exception conditions OPM should consider when setting the 640-hour requirement? Should agencies be able to consider and credit work experience from non-Federal Internships for up to 320 hours? Comments in favor of crediting non-Federal experience should address the types of criteria and documentation that could be used to evaluate such experiences.

• Whether OPM should consider making a change to the 640-hour service requirement that must be met for conversion of an Intern. Although this proposal retains the existing 640-hour Pathways hours of service requirement to be eligible for non-competitive conversion, OPM is open to adopting a different hourly requirement in the final rule. OPM is interested in learning more about non-Federal entities' best practices with regard to internship conversion pipelines, especially if there are innovative programs that integrate specific internship requirements (hours of service, content, skill-based assessment) with defined pathways into career paths. OPM encourages commenters who suggest a different length for the work hour requirement to discuss the advantages and/or disadvantages of such a change.

• Whether to revise the PMF regulations by clarifying the developmental assignment requirement by providing examples that we expect will assist agencies and Fellows alike. Projects requiring implementation of a new Executive order, major piece of legislation, agency reorganization, or cross-agency collaboration on a major Administration initiative would be the sorts of projects that could serve as a developmental assignment. OPM welcomes further comments and other examples that could satisfy this requirement from the public.

OPM invites comments regarding the inclusion of career and technical education programs as meeting the eligibility criteria for the Recent Graduate Program. In this proposed regulation, the definition includes Federal programs: Job Corps, Registered Apprenticeship Programs, Peace Corps, and AmeriCorps. We are interested in comments as to whether these programs are appropriate. We are also interested in whether we should include non-Federal programs in the definition of career and technical education programs. Comments that advocate for inclusion of non-Federal programs should address the types of criteria and documentation that could be used to justify why those who complete such programs should be eligible for the Recent Graduates Program. OPM welcomes data showing the effectiveness and comparability to Federal programs that could support an expansion of eligibility.

Executive Orders 13563, 12866, and 14094 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. In accordance with the provisions of Executive Order 12866, this proposed rule was reviewed by the Office of Management and Budget as a significant, but not significant under section (3)(f)(1), rule.

The Director of the Office of Personnel Management certifies that this proposed rule will not have a significant economic impact on a substantial number of small entities because it applies only to Federal agencies and employees.

This regulation will not have substantial direct effects on the States, on the relationship between the National Government and the States, or on distribution of power and responsibilities among the various levels of government. Therefore, in accordance with Executive Order 13132, it is determined that this proposed rule does not have sufficient federalism implications to warrant preparation of a Federalism Assessment.

This regulation meets the applicable standard set forth in section 3(a) and (b)(2) of Executive Order 12988.

This proposed rule will not result in the expenditure by State, local, or tribal governments, in the aggregate, or by the private sector, of more than $100 million annually. Thus, no written assessment of unfunded mandates is required.

Notwithstanding any other provision of law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ) (PRA), unless that collection of information displays a currently valid Office of Management and Budget (OMB) Control Number. This proposed rule involves the following OMB-approved collections of information subject to the PRA: OMB Control Number 3206-0219, USAJOBS 3.0 and OMB Control Number 3206-0082, OPM 1300 (PMF Program Annual Application) OPM believes any additional burden associated with this proposed rule falls within the existing estimates currently associated with these control numbers. We do not anticipate that the implementation of this proposed rule will increase the cost burden to members of the public. Additional information regarding these collections of information—including all background materials—can be found at https://www.reginfo.gov/public/do/PRAMain by using the search function to enter either the title of the collection or the OMB Control Number.

For reasons stated in the preamble, the Office of Personnel Management proposes to amend 5 CFR parts 300, 315, 362, and 410 as follows:

The revisions and additions read as follows:

The revisions and addition read as follows:

The revisions and addition to read as follows:

I. Background

RHS offers a variety of programs to build or improve housing and essential community facilities in rural areas. RHS offers loans, grants, and loan guarantees for single- and multifamily housing, childcare centers, fire and police stations, hospitals, libraries, nursing homes, schools, first responder vehicles and equipment, and housing for farm laborers. RHS also provides technical assistance loans and grants in partnership with non-profit organizations, Indian tribes, state and federal government agencies, and local communities.

Well built, affordable housing is essential to the vitality of communities in rural America. Rural Development's (RD) Single Family Housing (SFH) Programs give families and individuals the opportunity to buy, build, or repair affordable homes located in rural America. Eligibility for these loans, loan guarantees, and grants is based on income and varies according to the average median income for each area.

RHS administers the following SFH Programs under 7 CFR parts 3550 and 3555 authorized by Section 502 of the Housing Act of 1949, as amended, (42 U.S.C. 1472):

• Section 502 Direct Loan Program assists low- and very low-income applicants who currently do not own adequate housing and cannot obtain other credit, the opportunity to acquire, build, rehabilitate, improve, or relocate dwellings in rural areas.

• Section 502 Guaranteed Loan Program assists low- and moderate-income applicants the opportunity to acquire, build, rehabilitate, improve, or relocate dwellings in rural areas.

The President announced in May 2022, the release of a Housing Supply Action Plan (the Plan) to ease the burden of housing costs over time, by boosting the supply of quality housing in every community. The plan includes legislative and administrative actions that will help close America's housing supply shortfall in five years, starting with the creation and preservation of hundreds of thousands of affordable housing units in the next three years. Under the Plan, the Administration intends to deploy new financing mechanisms to build and preserve more housing where housing gaps exist. There is special emphasis on supporting production and availability of manufactured housing through improved loan rates and terms making this type of homeownership more attainable and affordable.

The Housing and Urban Development's (HUD) Office of Manufactured Housing Program regulates the construction of all manufactured homes built in the United States. These homes are built and installed in accordance with the Federal Manufactured Home Construction and Safety Standards (FMHCSS) administered by HUD. FMHCSS became effective June 15, 1976, replacing the term “Mobile Home” with “Manufactured Home.” These federal standards regulate manufactured housing design and construction, installation, strength and durability, transportability, fire resistance, energy efficiency and quality. The FMHCSS also sets performance standards for the heating, plumbing, air conditioning, thermal and electrical systems. Prior to the implementation of the FMHCSS in 1976, the construction and installation of manufactured homes were not uniformly regulated and were not generally considered to be quality, safe and sanitary housing. Further improvements to the FMHCSS were enacted in 1994 and 2007 with additional improvements in 2021 that included the development of mandates for manufactured home installation, the creation of a federal installation oversight program, mandated updates to the HUD code to enforce construction and safety standards for factory built manufactured homes to address items such as structural design, wind force resistance, additional loads requirements that are in accordance with the design load identified on data plate, and smoke alarm requirements. These were all implemented in accordance with the Manufactured Home Improvement Act of 2000.

RHS defines a manufactured home as a structure that is built to FMHCSS and placed on a permanent foundation. It is transportable in one or more sections, which in the traveling mode is 10-body feet (3.048 meters) or more in width, and when erected on site is 400 or more square feet (37.16 square meters), and which is built on a permanent chassis and designed to be used as a dwelling with or without a permanent foundation when connected to the required utilities. It is designed and constructed for permanent occupancy by a single family and contains permanent eating, cooking, sleeping, and sanitary facilities. The plumbing, heating, and electrical systems are contained in the structure. RHS will continue to require all new and existing manufactured homes to be constructed and placed on a permanent foundation in accordance with RD Instruction 1924-A, as applicable to the Direct Program, and the FMHCSS, established by HUD and found in 24 CFR part 3280.

The proposed revisions will allow the Agency to responsibly and effectively utilize funds appropriated by Congress by allowing borrowers more purchase options within a competitive market and thereby increasing the likelihood of finding adequate housing which increases program impact. The Agency proposes to modify the direct and guaranteed loan regulations as follows:

1. Update the current regulations to permit the purchase of existing manufactured homes for direct and guaranteed loans. The current direct and guaranteed regulations prohibit the purchase of a manufactured home unless it is a new unit, an existing unit and site already financed with a section 502 loan or is a RHS real estate owned (REO) property. The Agency has been operating a pilot for the direct and guaranteed programs to test the concept of waiving the regulatory restrictions to finance existing manufactured homes in selected pilot states, even if the home is not currently financed by the agency. Under the pilot, the unit must have been constructed on or after January 1, 2006, in conformance with the Federal Manufactured Home Construction and Safety Standards (FMHCSS), as evidenced by an affixed Housing and Urban Development (HUD) Certification Label and the unit must not have been previously installed on a different homesite, or had any structural alterations to it since construction in the factory, except for porches, decks or other structures which were built to engineered designs or were approved and inspected by local code officials. Once this rulemaking is final, these requirements will be the placed in the program handbooks and any adjustment to the date will be made public through a Federal Register notice. It has been determined that the pilot has been successful in increasing homeownership by expanding the Direct and Guaranteed portfolios by 1,372 loans. Therefore, regulatory revisions are being proposed to provide additional flexibility for the programs to lend on existing manufactured homes built in conformance with standards and a manufacture date, as determined by the Agency, based on factors such as industry standards and practices.

2. For direct and guaranteed loans, update the current regulations language to meet conditions of the ownership requirement for energy efficient manufactured and modular home financing in Land-Lease Communities Operating on a Nonprofit Basis pilot, and expand this to include Tribal lands. These updates are expected to provide additional flexibility for new energy efficient manufactured and modular homes that meet the conditions of the pilot, as well as provide consistency between the direct and guaranteed programs. Currently, the Agency is operating an ownership requirement pilot for energy efficient manufactured and modular home financing in land-lease communities operating on a nonprofit basis, for the direct and guaranteed programs. Under the pilot, RD accepts leases with an unexpired term that is at least two years beyond the term of the promissory note in the pilot states.

3. Remove the administrative requirements from the regulations for review and approval of applications from manufactured housing dealers for direct loans. The removal of this requirement will alleviate Agency staff from the review and approval of applications from manufactured housing dealers and the maintenance of a list that must be updated every two years based on the activity of the “approved” dealer-contractors, thus providing the Agency with needed flexibility. This review process provided minimal value to both the applicant or dealer and contrasted from the requirements for site-built contractors who do not have a formal application or approval process nor is there a list of approved site-built contractors maintained. The removal will also prevent delays in the processing of a manufactured housing purchase request by eliminating the need to approve the dealer prior to proceeding, which can be time-consuming due to the review of financial and credit information for the dealer. The dealer will still be required to provide all site services and agree to construction and development requirements in 7 CFR 3550.73(d) and standards set forth in the FMHCSS.

4. Revise the definition of “Manufactured home” in 7 CFR 3550.10 Definitions to remove reference to RHS Thermal Performance Standards for direct loans.

The removal of this reference is necessary due to RHS exemption from these thermal standards. Instead, RHS relies on HUD FMHCSS for thermal performance requirements for construction of manufactured homes. This change will also provide further alignment between the Section 502 Direct and Guaranteed loan programs.

The Agency proposes to update the current Section 502 Direct and SFH Guaranteed Loan Programs regulations implemented under 7 CFR parts 3550 and 3555. This will be accomplished by reducing the regulatory burdens that are specifically related to manufactured housing requirements, enhancing program delivery, customer service, promoting consistency between the direct and guaranteed SFH loan programs, and reflect current housing market conditions and mortgage loan practices.

The Agency proposes to change 7 CFR parts 3555 and 3550 by:

(1) Update sections 3550.52(e)(1), 3550.73(b)(1), 3555.208(b)(3) and add new paragraph 3555.208(a)(3) to clarify that borrowers are allowed under the direct and guaranteed loan programs to purchase existing manufactured homes constructed in conformance with the FMHCSS standards, as specified in program handbooks.

(2) Update sections 3550.58(b) and 3555.203(b)(3) so that, for the direct and guaranteed loan programs, the Agency will accept a land-lease with an unexpired term that is at least two years longer than the mortgage term for new energy efficient manufactured and modular home financing in Tribal and land-lease communities operating on a nonprofit basis.

(3) Remove paragraph (c) from section 3550.73 which requires Agency approval of manufactured housing dealers for direct loans.

(4) Update the definition of Manufactured home under section 3550.10, by removing reference to “RHS Thermal Performance Standards” for direct loans. SFH is exempt from RHS Thermal Performance Standards compliance.

Section 510(k) of Title V the Housing Act of 1949 [42 U.S.C. 1480(k)], as amended, authorizes the Secretary of the Department of Agriculture to promulgate rules and regulations as deemed necessary to carry out the purpose of that title; and implemented under 7 CFR parts 3550 and 3555.

These programs are not subject to the requirements of Executive Order 12372, “Intergovernmental Review of Federal Programs,” as implemented under the USDA's regulations at 2 CFR part 415, subpart C.

This proposed rule has been determined to be non-significant and, therefore, was not reviewed by the Office of Management and Budget (OMB) under Executive Order 12866.

This proposed rule has been reviewed under Executive Order 12988. In accordance with this proposed rule: (1) Unless otherwise specifically provided, all State and local laws that conflict with this proposed rule will be preempted; (2) no retroactive effect will be given to this proposed rule except as specifically prescribed in the proposed rule; and (3) administrative proceedings of the National Appeals Division of the Department of Agriculture (7 CFR part 11) must be exhausted before suing in court that challenges action taken under this proposed rule.

The policies contained in this proposed rule do not have any substantial direct effect on 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. This proposed rule does not impose substantial direct compliance costs on state and local governments; therefore, consultation with States is not required.

This executive order imposes requirements on RHS in the development of regulatory policies that have tribal implications or preempt tribal laws. RHS has determined that the proposed rule does not have a substantial direct effect on one or more Indian tribe(s) or on either the relationship or the distribution of powers and responsibilities between the Federal Government and Indian tribes. Thus, this proposed rule is not subject to the requirements of Executive Order 13175. If tribal leaders are interested in consulting with RHS on this rule, they are encouraged to contact USDA's Office of Tribal Relations or RD's Tribal Coordinator at: AIAN@usda.gov to request such a consultation.

In accordance with the National Environmental Policy Act of 1969, Public Law 91-190, this document has been reviewed in accordance with 7 CFR part 1970 (“Environmental determined that i) this action meets the criteria established in 7 CFR 1970.53(f); ii) no extraordinary circumstances exist; and iii) the action is not “connected” to other actions with potentially significant impacts, is not considered a “cumulative action” and is not precluded by 40 CFR 1506.1. Therefore, the Agency has determined that the action does not have a significant effect on the human environment, and therefore neither an Environmental Assessment nor an Environmental Impact Statement is required.

This proposed rule has been reviewed with regard to the requirements of the Regulatory Flexibility Act (5 U.S.C. 601-612). The undersigned has determined and certified by signature on this document that this proposed rule will not have a significant economic impact on a substantial number of small entities since this rulemaking action does not involve a new or expanded program nor does it require any more action on the part of a small business than required of a large entity.

Title II of the UMRA, Public Law 104-4, establishes requirements for Federal agencies to assess the effects of their regulatory actions on state, local, and tribal governments and on the private sector. Under section 202 of the UMRA, the Agency generally must prepare a written statement, including cost-benefit analysis, for proposed and final rules with Federal mandates that may result in expenditures to state, local, or tribal Governments, in the aggregate, or to the private sector, of $100 million or more in any one year. When such a statement is needed for a rule, section 205 of the UMRA generally requires the Agency to identify and consider a reasonable number of regulatory alternatives and adopt the least costly, more cost-effective, or least burdensome alternative that achieves the objectives of the rule.

This proposed rule contains no Federal mandates (under the regulatory provisions of title II of the UMRA) for state, local, and tribal Governments or for the private sector. Therefore, this proposed rule is not subject to the requirements of sections 202 and 205 of the UMRA.

The Office of Management and Budget's (OMB) regulation (5 CFR part 1320) implementing provisions of the Paperwork Reduction Act of 1995 (Pub. L. 104-13) requires that interested members of the public and affected agencies have an opportunity to comment on information collection and recordkeeping activities (see 5 CFR 1320.8(d)). This notice identifies the following information collection that RHS is submitting to OMB as a revision to an existing approved collection with Agency adjustment. The Agency expects a modest change in burden once this proposed rule is published as a final rule in the Federal Register .

Title: Direct Single Family Housing Loan and Grant Programs, 7 CFR 3550-HB-1-3550, and HB-2-3550.

OMB Control Number: 0575-0172.

Expiration Date of Approval: February 28, 2025.

Type of Request: Revision of a currently approved information collection.

Estimate of Burden: Public reporting burden for this collection of information is estimated to average .500 hours per response.

Respondents: Business or other for profit, not-for-profit institutions.

Estimated Number of Respondents: Approximately 50 manufactured dealer- contractors seeking approval to provide manufactured sales, service and site development services.

Estimated Number of Responses per Respondent: 1.

Estimated Number of Responses: 50.

Estimated Total Annual Burden on Respondents: 25 hours.

Abstract: Through the Section 502 direct single family housing loan program, RHS provides 100 percent loan financing to assist eligible low- and very low-income applicants purchase modest homes in eligible rural areas by providing payment assistance to increase an applicant's repayment ability.

Applicants must provide the Agency with a uniform residential loan application and supporting documentation ( e.g., verification of income, assets, liabilities, etc.) when applying for assistance. The information requested is comparable to that required by any public or private mortgage lender.

Applicants who choose to purchase a new manufactured home are currently required to purchase from an approved manufactured dealer-contractor. Manufactured dealer-contractors who wish to participate in the Section 502 direct program are required to submit RD Form 1944-5, Manufactured Housing Dealer-Contractor Application, along with supplementary data sources such as financial statements and tax returns to verify or determine employment, income, and held assets. After RHS review, a dealer-contractor meeting qualification criteria may be added to list of approved dealer-contractors maintained for each state. Applicants must choose an approved dealer-contractor from this list for purchase and all other site services related to the transaction. If an applicant wishes to purchase a new manufactured home from a dealer-contractor who has not received prior approval, the applicant is notified of other approved dealer-contractors on the state list. If applicants still request to purchase from a dealer-contractor who has not received prior approval, the dealer-contractor must submit the required form and supplementary documentation and wait for their approval prior to entering into a contract with the applicant. Elimination of prior approval will remove obstacles and potential delays for applicants to purchase new manufactured housing while sustained manufactured construction regulations will continue to maintain quality and installation standards.

Comments are invited on:

(a) Whether the collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;

(b) the accuracy of the agency's estimate of the burden of the collection of information including the validity of the methodology and assumptions used;

(c) ways to enhance the quality, utility, and clarity of the information to be collected; and

(d) ways to minimize the burden of the collection of information on respondents, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.

Copies of this information collection can be obtained from Crystal Pemberton, Rural Development Innovation Center—Regulations Management Division, at Telephone: (202) 260-8621, Email: Crystal.Pemberton@usda.gov.

All responses to this notice will be summarized and included in the request for OMB approval. All comments will also become a matter of public record.

RHS is committed to complying with the E-Government Act by promoting the use of the internet and other information technologies to provide increased opportunities for citizen access to Government information, services, and other purposes.

Rural Development has reviewed this proposed rule in accordance with USDA Regulation 4300-004, Civil Rights Impact Analysis,” to identify any major civil rights impacts the proposed rule might have on program participants on the basis of age, race, color, national origin, sex, or disability. After review and analysis of the proposed rule and available data, it has been determined that implementation of the proposed rule will not adversely or disproportionately impact very low-, low- and moderate-income populations, minority populations, women, Indian tribes, or persons with disability by virtue of their race, color, national origin, sex, age, disability, or marital or familial status. No major civil rights impact is likely to result from this proposed rule.

The programs affected by this regulation are listed in the Assistance Listing Catalog (formerly Catalog of Federal Domestic Assistance) under number 10.410, Very Low to Moderate Income Housing Loans (Section 502 Rural Housing Loans), and number 10.417, Very Low-Income Housing Repair Loans and Grants (specifically the Section 504 direct loans and grants).

In accordance with Federal civil rights laws and USDA civil rights regulations and policies, the USDA, its Mission Areas, agencies, staff offices, employees, and institutions participating in or administering USDA programs are prohibited from discriminating based on race, color, national origin, religion, sex, gender identity (including gender expression), sexual orientation, disability, age, marital status, family/parental status, income derived from a public assistance program, political beliefs, or reprisal or retaliation for prior civil rights activity, in any program or activity conducted or funded by USDA (not all bases apply to all programs). Remedies and complaint filing deadlines vary by program or incident.

Program information may be made available in languages other than English. Persons with disabilities who require alternative means of communication to obtain program information ( e.g., Braille, large print, audiotape, American Sign Language) should contact the responsible Mission Area, agency, or staff office; the USDA TARGET Center at (202) 720-2600 (voice and TTY); or the Federal Relay Service at (800) 877-8339.

To file a program discrimination complaint, a complainant should complete a Form AD-3027, USDA Program Discrimination Complaint Form, which can be obtained online at https://www.usda.gov/sites/default/files/documents/ad-3027.pdf, from any USDA office, by calling (866) 632-9992, or by writing a letter addressed to USDA. The letter must contain the complainant's name, address, telephone number, and a written description of the alleged discriminatory action in sufficient detail to inform the Assistant Secretary for Civil Rights about the nature and date of an alleged civil rights violation.

The completed AD-3027 form or letter must be submitted to USDA by:

(1) Mail: U.S. Department of Agriculture, Office of the Assistant Secretary for Civil Rights, 1400 Independence Avenue SW, Washington, DC 20250-9410; or

(2) Fax: (833) 256-1665 or (202) 690-7442; or

(3) Email: program.intake@usda.gov.

USDA is an equal opportunity provider, employer, and lender.

For the reasons set forth in the preamble, the Rural Housing Service proposes to amend 7 CFR parts 3550 and 3555 as follows:

The revision reads as follows:

The addition and revisions read as follows:

On July 13, 2023, the Commission received a Petition for Rulemaking (“Petition”) from Public Citizen, a non-profit advocacy organization. The Petition asks the Commission to amend its regulation on “fraudulent misrepresentation” at 11 CFR 110.16 to clarify that “the restrictions and penalties of the law and the Code of Regulations are applicable” should “candidates or their agents fraudulently misrepresent other candidates or political parties through deliberately false [Artificial Intelligence]-generated content in campaign ads or other communications.” Petition at 5.

The Federal Election Campaign Act (the “Act”) provides that a candidate for federal office, employee, or agent of such a candidate shall not “fraudulently misrepresent” themselves or any committee or organization under their control “as speaking or writing or otherwise acting for or on behalf of any other candidate or political party or employee or agent thereof on a matter which is damaging to such other candidate or political party or employee or agent thereof.” 52 U.S.C. 30124(a)(1).

The Petition asserts that generative Artificial Intelligence and deepfake technology, is being “used to create convincing images, audio and video hoaxes.” Petition at 2. The Petition asserts that while the technology is not so far advanced currently as for viewers to not be able to identify when it is used disingenuously, if the use of the “technology continues to improve, it will become increasingly difficult, and perhaps, nearly impossible for an average person to distinguish deepfake videos and audio clips from authentic media.” Id.

The Petition notes that the technology will “almost certainly create the opportunity for political actors to deploy it to deceive voters[,] in ways that extend well beyond any First Amendment protections for political expression, opinion or satire.” Id. According to the Petition, this technology might be used to “create a video that purports to show an opponent making an offensive statement or accepting a bribe” and, once disseminated, be used for the purpose of “persuading voters that the opponent said or did something they did not say or do.” Id. The Petition explains that a deepfake audio clip or video by a candidate or their agent would violate the fraudulent misrepresentation provision by “falsely putting words into another candidate's mouth, or showing the candidate taking action they did not [take],” thereby “fraudulently speak[ing] or act[ing] `for' that candidate in a way deliberately intended to [harm] him or her.” Id. at 3. The Petitioner states that because the deepfaker misrepresents themselves as speaking for the deepfaked candidate, “the deepfake is fraudulent because the deepfaked candidate in fact did not say or do what is depicted by the deepfake and because the deepfake aims to deceive the public.” Id. The Petitioner draws a distinction between deepfakes, which it contends violates the prohibition on fraudulent misrepresentation, and other uses of Artificial Intelligence in campaign communications, such as in parodies, where the purpose and effect are not to deceive voters, or as in other communications where “there is a sufficiently prominent disclosure that the image, audio or video was generated by [A]rtificial [I]ntelligence and portrays fictitious statements and actions.” Id. at 4.

The Commission seeks comment on the Petition. The public may inspect the Petition on the Commission's website at http://www.fec.gov/fosers/.

The Commission will not consider the Petition's merits until after the comment period closes. If the Commission decides that the Petition has merit, it may begin a rulemaking proceeding. The Commission will announce any action that is takes in the Federal Register .

I. FCPA and FCM Petition

The SOI for POJ requires that the product contains not less than 10.5 percent by weight of orange juice soluble solids (also expressed as degree Brix), exclusive of the solids of any added optional sweetening ingredients, and the ratio of the Brix hydrometer reading to the grams of anhydrous citric acid per 100 milliliters of juice is not less than 10 to 1 (§ 146.140(a) (21 CFR 146.140(a)). The Brix level expresses the percentage of orange juice solids present in a product. The SOI for POJ allows for the addition of concentrated orange juice ingredients and certain optional sweetening ingredients to adjust the Brix (§ 146.140(b) and (c)), provided that the label of POJ bears a statement that the concentrated orange juice ingredient or optional sweetening ingredient has been added (§ 146.140(e)(1) and (2)). Under this standard, the “optional sweetening ingredients” (or “sweeteners”) are sugar, invert sugar, dextrose, dried corn sirup, and dried glucose sirup (§ 146.140(c)).

The FCPA and FCM jointly submitted a citizen petition (Docket No. FDA-2022-P-1668) on July 25, 2022, asking us to amend the SOI for POJ to reduce the minimum soluble solids requirement for POJ from 10.5° to 10° Brix, exclusive of the solids from any added optional sweetening ingredients. See Citizen Petition from Florida Citrus Processors Association Inc. and Florida Citrus Mutual Inc., entitled “Request to Amend Pasteurized Orange Juice Standard of Identity,” sent to the Division of Dockets Management (now called the Dockets Management Staff), Food and Drug Administration, dated July 22, 2022 (“Petition”). The FCPA and FCM stated that when FDA issued the SOI for POJ in 1963 (see “Orange Juice and Orange Juice Products; Definitions and Standards of Identity; Findings of Fact and Final Order,” 28 FR 10900, October 11, 1963), FDA recognized that Florida was the dominant supplier of juice oranges with an average Brix of 11.8°. The petitioners asserted that, based on the fruits used in preparing POJ at that time, FDA set a minimum Brix value of 10.5° for the POJ standard (Petition at page 3).

The FCPA and FCM stated that Florida's average Brix level has steadily dropped over the past couple of decades due to a bacterial disease called “citrus greening disease,” also known as Huanglongbing (id.). (According to information on the U.S. Department of Agriculture (USDA), Animal and Plant Health Inspection Service's (APHIS) website, symptoms of trees infected with citrus greening include blotchy mottle leaves, stunted grown, reduced fruit size, premature fruit drop, corky veins, and root decline, and the disease eventually causes tree death. See USDA APHIS, “Citrus Greening,” at https://www.aphis.usda.gov/aphis/ourfocus/planthealth/plant-pest-and-disease-programs/pests-and-diseases/citrus/citrus-greening#:~:text=Huanglongbing%20(HLB)%2C%20also%20known,when%20feeding%20on%20new%20shoots ). There is no cure for citrus greening disease. The FCPA and FCM also maintained that severe weather, particularly Hurricane Irma in 2017, has resulted in reduced production of oranges and normal fruit sugar content (Petition at pages 3 to 4). The FCPA and FCM stated that, due to these factors, seasonal average Brix values (weighted by volume) are hovering below the minimum of 10.5° Brix (Petition at page 4). The FCPA and FCM stated that the POJ SOI was carefully constructed to reflect the qualities of U.S. oranges, and asserted that it should now be updated to align with the properties of the modern U.S. crop (Petition at page 5).

The FCPA and FCM noted that the POJ SOI sets specific requirements for juice content and labeling, including a minimum fruit sugar level (Petition at page 3). The FCPA and FCM stated that most fruit juices, albeit many of which have a relatively lower volume of sales, have no U.S. standards and that this regulatory discrepancy further emphasizes the need to amend the orange juice SOI to keep pace with modern scientific understanding and naturally occurring dynamics impacting product production (Petition at page 7). The FCPA and FCM asserted that without such an update, POJ products will be further disadvantaged in the market (id.).

The FCPA and FCM maintained that the SOIs for various orange juice products are intended to serve the interest of consumers and the POJ standard established POJ as a high-quality and minimally processed juice that is heat-treated to eliminate potentially harmful pathogens and is not concentrated or reconstituted with added water (Petition at page 3). They asserted that consumers widely understand POJ to be natural, not from concentrate juice made from mature Florida oranges (Petition at page 5), although they did not provide information demonstrating this consumer understanding.

The Petition included the results of a consumer survey to assess orange juice and consumer “willingness to buy” orange juice with varying levels of sweetness under hypothetical settings which was conducted online among a total of 1,027 adult men and women, aged 18 to 69 years old, who consume 100 percent fruit juice at least once in a typical 2-week period (Petition at Appendix 4). From this consumer survey, the FCPA and FCM concluded that 96 percent of the consumers in the study accepted the idea that a natural product, like orange juice, could have varying levels of sweetness (Petition at page 6). The FCPA and FCM also noted that 95 percent of those surveyed agreed that orange juice with less sugar should still be called orange juice, and 76 percent claimed they would have no concerns with a less sweet orange juice (id.). The petitioners did not provide information on how these general statements and preferences relate to the Brix level for POJ.

The FCPA and FCM stated that the 10° minimum Brix level they request for POJ is consistent with the minimum Brix level of 10° for the SOI for canned orange juice specified in 21 CFR 146.141 (Petition at page 6). The FCPA and FCM also asserted that the 10° Brix level would be consistent with the applicable Codex General Standard for Juices and Nectars, which has no minimum but allows for Brix for not-from-concentrate POJ to be at the Brix level of the fruit from which the juice is directly expressed (id.). They also noted that the European Fruit Juice Directive incorporates a 10° minimum Brix, established by the European Fruit Juice industry in the AIJN Code of Practice (id.). The FCPA and FCM stated that the proposed minimum Brix decrease would help to bring the POJ standard into alignment with these international food standards (Petition at pages 6 to 7).

Finally, the FCPA and FCM maintained that a temporary marketing permit (TMP) under § 130.17 (21 CFR 130.17) for POJ with a lower Brix level would not be a viable option, due to the overwhelming presence of low-Brix orange juice crops in recent years, because it would be burdensome for manufacturers to make labeling changes and add stock keeping units for the lower-Brix products and could cause consumer confusion (Petition at page 5). No information was provided on consumer understanding.

As noted above, FDA published a final order establishing SOIs for certain orange juice products, including POJ, in 1963. The final order contained various findings of fact, including a statement that “Florida orange juices available for processing” had an approximate average Brix level of 11.8° at the time (28 FR 10900 at 10905). While the FCPA and FCM maintained that this Brix value of 11.8° was used to set the standard for POJ (Petition at page 3), we clarify that FDA recognized this value in the context of the reconstituted orange juice standard, with FDA setting a minimum Brix of 11.8° in its standard for reconstituted orange juice (28 FR 10900 at 10906). By contrast, for POJ, FDA set a minimum Brix of 10.5°, recognizing that “the juice of many legally mature oranges that come on the market would not meet [a Brix of 10.5°]” and stating that producers could add frozen single-strength juice or orange juice concentrate to achieve a higher Brix level (28 FR 10900 at 10902). On the basis of these and other facts and evidence, FDA established SOIs for orange juice and various orange juice products.

We invite interested persons to submit comments, data, and information concerning the need for, and the appropriateness of, amending the SOI for POJ. We especially invite comment and supporting data, as appropriate, on the following matters:

1. The SOI for POJ requires that the product contains not less than 10.5 percent by weight of orange juice soluble solids (that is, the Brix level), exclusive of the solids of any added optional sweetening ingredients (§ 146.140(a)). Would amending the SOI for POJ from 10.5 to 10 percent by weight of orange juice soluble solids continue to promote honesty and fair dealing in the interest of consumers? Specifically, would such an amendment result in products that are inconsistent with consumer expectations about POJ? The petitioners noted that POJ with a lower Brix has less sugar—specifically, when Brix value is lowered from 10.5° to 10.25° or 10°, the sugar content is reduced from 18 grams to 17 grams per 8 oz of product (see Petition at Appendix 4, page 19). Would POJ products with a Brix level between 10° and 10.5° taste less sweet or have less orange flavor such that consumers would not accept them? Please explain your reasoning.

2. Below are the Nutrition Facts labels for the POJ with different Brix levels provided by the petitioners (id.). From left to right are labels for product with 10.5° Brix, 10.25° Brix, and 10.0° Brix.

I. Public Participation A. Written Comments

Submit your comments, identified by Docket ID No. EPA-HQ-OW-2023-0073, at https://www.regulations.gov (our preferred method), or the other methods identified in the ADDRESSES section. Once submitted, comments cannot be edited or removed from the docket. The EPA may publish any comment received to its public docket. Do not submit to EPA's docket at https://www.regulations.gov any information you consider to be Confidential Business Information (CBI), Proprietary Business Information (PBI), or other information whose disclosure is restricted by statute. If you need to submit CBI, contact Lisa Pham, contact information available in the FOR FURTHER INFORMATION CONTACT section. Multimedia submissions (audio, video, etc.) must be accompanied by a written comment. The written comment is considered the official comment and should include discussion of all points you wish to make. The EPA will generally not consider comments or comment contents located outside of the primary submission ( i.e., on the web, cloud, or other file sharing system). Please visit https://www.epa.gov/dockets/commenting-epa-dockets for additional submission methods; the full EPA public comment policy; information about CBI, PBI, or multimedia submissions; and general guidance on making effective comments.

This document presents LDNR's supplement to its primacy application regarding Louisiana State Act No. 378. This act was signed into law and went into effect on June 14, 2023, during the comment period for EPA's proposed rulemaking, “State of Louisiana Underground Injection Control Program; Class VI Program Revision Application” (88 FR 28450, May 4, 2023). LDNR thereafter supplemented its Class VI primacy application to incorporate the new act, which revised portions of Louisiana law relevant to LDNR's Class VI primacy application. In LDNR's letter supplementing its application, LDNR stated that it found that Act 378 had no substantive impact on its pending application. The purpose of this document is to provide public notice and the opportunity for comment specific to LDNR's supplement to its primacy application regarding Louisiana State Act No. 378, which was not available for public review and comment at the time of the proposal. EPA is not reopening the overall comment period for the Agency's proposed approval of Louisiana's Class VI primacy application. EPA continues to review the comments received on the Agency's proposed approval and will address those comments and the comments submitted in response to this document in the final action.

Act 378 revised portions of Louisiana law relevant to LDNR's Class VI primacy application. For instance, it codified a parish notification requirement for permit applications for Class VI wells (and Class V wells related to geologic sequestration of carbon dioxide). It also codified Class VI quarterly and twenty-four-hour reporting requirements. It also revised Louisiana's long term liability provision in Louisiana Revised Statute (LA R.S.) 30:1109. As mentioned in the May 4, 2023, proposal, EPA is aware that stakeholders have raised concerns about this provision. EPA has reviewed Act 378, including its revisions to the long-term liability provision at LA R.S. 30:1109, and continues to propose approving Louisiana's application for Class VI primacy. EPA has determined that the application as supplemented continues to meet all applicable requirements for approval under SDWA section 1422.

Persons interested in the Class VI UIC program established by the State of Louisiana, and its proposed incorporation under Section 1422 of the SDWA are encouraged to read the new information presented and respond to this document. Additionally, owners and operators, States, Tribes, and State co-regulators involved in geologic sequestration activities in Louisiana may also wish to comment on this publication. EPA is not reopening the overall comment period for the Agency's proposed approval of Louisiana's Class VI primacy application. EPA continues to review the comments received on the Agency's proposed rule approval and will address those comments and the comments submitted in response to this document in the final action.

Table of Contents I. Introduction II. NPL Deletion Criteria III. Deletion Procedures IV. Basis for Intended Full Site or Partial Site Deletion I. Introduction

EPA is issuing a proposed rule to delete one site and partially delete two sites from the National Priorities List (NPL) and requests public comments on this proposed action. The NPL constitutes Appendix B of 40 CFR part 300 which is the NCP, which EPA created under section 105 of the CERCLA statute of 1980, as amended. EPA maintains the NPL as those sites that appear to present a significant risk to public health, welfare, or the environment. Sites on the NPL may be the subject of remedial actions financed by the Hazardous Substance Superfund (Fund). These partial deletions are proposed in accordance with 40 CFR 300.425(e) and is consistent with the Notice of Policy Change: Partial Deletion of Sites Listed on the National Priorities List. 60 FR 55466, (November 1, 1995). As described in 40 CFR 300.425(e)(3) of the NCP, a site or portion of a site deleted from the NPL remains eligible for Fund-financed remedial action if future conditions warrant such actions.

EPA will accept comments on the proposal to delete or partially delete these sites for thirty (30) days after publication of this document in the Federal Register .

Section II of this document explains the criteria for deleting sites from the NPL. Section III of this document discusses procedures that EPA is using for this action. Section IV of this document discusses the site or portion of the site proposed for deletion and demonstrates how it meets the deletion criteria, including reference documents with the rationale and data principally relied upon by the EPA to determine that the Superfund response is complete.

The NCP establishes the criteria that EPA uses to delete sites from the NPL. In accordance with 40 CFR 300.425(e), sites may be deleted from the NPL where no further response is appropriate. In making such a determination pursuant to 40 CFR 300.425(e), EPA will consider, in consultation with the State, whether any of the following criteria have been met:

i. Responsible parties or other persons have implemented all appropriate response actions required;

ii. All appropriate Fund-financed response under CERCLA has been implemented, and no further response action by responsible parties is appropriate; or

iii. The remedial investigation has shown that the release poses no significant threat to public health or the environment and, therefore, the taking of remedial measures is not appropriate.

Pursuant to CERCLA section 121(c) and the NCP, EPA conducts five-year reviews to ensure the continued protectiveness of remedial actions where hazardous substances, pollutants, or contaminants remain at a site above levels that allow for unlimited use and unrestricted exposure. EPA conducts such five-year reviews even if a site is deleted from the NPL. EPA may initiate further action to ensure continued protectiveness at a deleted site if new information becomes available that indicates it is appropriate. Whenever there is a significant release from a site deleted from the NPL, the deleted site may be restored to the NPL without application of the hazard ranking system.

The following procedures apply to the deletion or partial deletion of the sites in this proposed rule:

(1) EPA consulted with the respective state before developing this Notice of Intent for deletion.

(2) EPA has provided the state 30 working days for review of site deletion documents prior to publication of it today.

(3) In accordance with the criteria discussed above, EPA has determined that no further response is appropriate.

(4) The state, through their designated state agency, has concurred with the proposed deletion action.

(5) Concurrently, with the publication of this Notice of Intent for deletion in the Federal Register , a notice is being published in a major local newspaper of general circulation near the site. The newspaper announces the 30-day public comment period concerning the proposed action for deletion.

(6) The EPA placed copies of documents supporting the proposed deletion in the deletion docket, made these items available for public inspection, and copying at the Regional Records Center identified above.

If comments are received within the 30-day comment period on this document, EPA will evaluate and respond accordingly to the comments before making a final decision to delete or partially delete the site. If necessary, EPA will prepare a Responsiveness Summary to address any significant public comments received. After the public comment period, if EPA determines it is still appropriate to delete or partially delete the site, the EPA will publish a final Notice of Deletion or Partial Deletion in the Federal Register . Public notices, public submissions and copies of the Responsiveness Summary, if prepared, will be made available to interested parties and included in the site information repositories listed above.

Deletion of a site or a portion of a site from the NPL does not itself create, alter, or revoke any individual's rights or obligations. Deletion of a site or a portion of a site from the NPL does not in any way alter EPA's right to take enforcement actions, as appropriate. The NPL is designed primarily for informational purposes and to assist EPA management. Section 300.425(e)(3) of the NCP states that the deletion of a site from the NPL does not preclude eligibility for future response actions, should future conditions warrant such actions.

The site to be deleted or partially deleted from the NPL, the location of the site, and docket number with information including reference documents with the rationale and data principally relied upon by the EPA to determine that the Superfund response is complete are specified in Table 1. The NCP permits activities to occur at a deleted site, or that media or parcel of a partially deleted site, including operation and maintenance of the remedy, monitoring, and five-year reviews. These activities for the site are entered in Table 1, if applicable, under Footnote such that; 1 = site has continued operation and maintenance of the remedy, 2 = site receives continued monitoring, and 3 = site five-year reviews are conducted.

Table 2 includes information concerning whether the full site is proposed for deletion from the NPL or a description of the area, media or Operable Units (OUs) of the NPL site proposed for partial deletion from the NPL, and an email address to which public comments may be submitted if the commenter does not comment using https://www.regulations.gov.

EPA maintains the NPL as the list of sites that appear to present a significant risk to public health, welfare, or the environment. Deletion from the NPL does not preclude further remedial action. Whenever there is a significant release from a site deleted from the NPL, the deleted site may be restored to the NPL without application of the hazard ranking system. Deletion of a site from the NPL does not affect responsible party liability in the unlikely event that future conditions warrant further actions.

This proposed rule implements HHS's administration of priorities and allocations actions with respect to health resources and establishes the Health Resources Priorities and Allocations System (HRPAS). The HRPAS covers health resources pursuant to the authority under section 101(a) of the Defense Production Act (DPA) of 1950 as delegated to the Secretary of HHS (Secretary) by Executive Order (E.O.) 13603. On September 26, 2022, the Secretary delegated to the Assistant Secretary for Preparedness and Response (the ASPR) within the Administration for Strategic Preparedness and Response (ASPR), the authority under section 201 of E.O. 13603 to exercise priorities authority under section 101 of the DPA. This delegation authorized the ASPR, on behalf of the Secretary, to approve DO—[—[M1-M9] priority rating requests for health resources that promote the national defense. This delegation excludes the authority to approve all priorities provisions for health resources that require DX—[—[M1-M9] priority ratings. The Secretary retains all other authorities delegated by the President in E.O. 13603.

The HRPAS has two principal components: priorities and allocations. Under the priorities' component, the Secretary is authorized to place priority ratings on contracts or orders for health resources to support programs which have been determined by the Department of Defense, Department of Energy, or Department of Homeland Security as necessary or appropriate to promote the national defense in accordance with section 202 of E.O. 13603. Through the HRPAS rule, HHS may also respond to requests to place priority ratings on contracts or orders (requiring priority performance of contracts or orders) for health resources, as specified in the DPA, if the necessity arises. Under the priorities' component, certain contracts or orders between the government and private parties or between private parties for the production or delivery of health resources are required to be prioritized over other contracts or orders to facilitate expedited production or delivery in promotion of the U.S. national defense. The Secretary retains the authority for allocations. Under the allocations' component, materials, services, and facilities may be allocated to promote the national defense. Such requests must be determined as necessary or appropriate to promote the national defense in accordance with section 202 of E.O. 13603. For both components, the term “national defense” is defined in section 801(j) of E.O. 13603 as “programs for military and energy production or construction, military or critical infrastructure assistance to any foreign nation, homeland security, stockpiling, space, and any directly related activity.” The term also includes emergency preparedness activities conducted pursuant to title VI of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (Stafford Act) and critical infrastructure protection and restoration. See E.O. 13603, section 801(j). Other authorities delegated to the Secretary in E.O. 13603, but not covered by this regulation may be re-delegated by the Secretary.

HHS published an interim final rule in the Federal Register at 80 FR 42408 on July 17, 2015, to comply with the Part II—Priorities and Allocations, Sec 201(b) of E.O. 13603, dated March 16, 2012, and section 101(d) of the DPA, 50 U.S.C. 4511(d), and received no public comments. Based on the significant amount of time between the publication of interim final rule in 2015, HHS is issuing this NPRM to allow for comments based on the experience of utilizing this authority to respond to COVID-19 and the infant formula shortage in 2022.

HRPAS is a program established in accordance with the DPA and E.O. 13603 that supports national defense needs (for health resources), including emergency preparedness initiatives, by addressing essential civilian needs through the placing of priority ratings on contracts and orders for items and services or allocating resources, as necessary. Although a specific Presidential disaster declaration is not required, the ability to prioritize or allocate items or services requires a determination be made in accordance with section 202 of E.O. 13603, (except as provided in section 201(e) for use of the allocations authority) that the program or programs are necessary or appropriate to promote national defense, including emergency preparedness. The HRPAS outlines several conditions that must be met in order for HHS to undertake an allocation order, which include a finding under section 101(b) of the DPA that such a material is a scarce and critical material essential to the national defense and that the requirements of the national defense for such material cannot otherwise be met without creating a significant dislocation of the normal distribution of such material in the civilian market to such a degree as to create appreciable hardship. The President must approve the finding, in accordance with section 201(e) of E.O. 13603, before the Secretary may use the allocation authority. Under section 702(14) of the DPA (50 U.S.C. 4552(14)), the term “national defense” includes emergency preparedness activities conducted pursuant to the Stafford Act, and critical infrastructure protection and restoration. Authority for priorities and allocations is specified in the DPA and further defined in E.O. 13603, “National Defense Resources Preparedness,” dated March 16, 2012. E.O. 13603 replaced E.O. 12919 and further defined jurisdictional areas and national defense preparedness roles and responsibilities for specific agencies. E.O. 13603 did not change the intent of the DPA as it applies to HHS's functions in national defense, including emergency preparedness. For the NPRM, only those sections in the “Supplementary Information” part of the Interim Final Rule preamble that required modifications due to E.O. 13603 or for other reasons are further discussed in the Supplementary Information section of this NPRM. A more thorough explanation of the HRPAS was published on July 17, 2015 (80 FR 42408-42423). We are not reiterating the Section-by-Section Changes of the Rule. Any changes to those sections are discussed in this document.

E.O. 13603 authorizes jurisdictional areas for each agency delegated title I authority under the DPA that is involved in national defense, including emergency preparedness. HHS has jurisdiction for items that fall under the category of health resources which is defined in E.O. 13603 as “drugs, biological products, medical devices, materials, facilities, health supplies, services and equipment required to diagnose, mitigate, or prevent the impairment of, improve, treat, cure, or restore the physical or mental health conditions of the population.” HHS cannot use its DPA authority for items or services not in its jurisdiction. Those entities in need of items or services that do not fall under the jurisdiction of HHS should request priorities assistance from the applicable resource department. HHS will direct the requesters to the appropriate resource agency if the request comes to HHS. HHS intends to work with other resource agencies to address instances where HHS does not have jurisdiction—or where jurisdiction may be overlapping or ambiguous—for items necessary to complete the order. HHS intends to work with the other resource agencies to request prioritization of contracts or orders for other items or services necessary for use in support of programs approved for use by HHS (see next section).

HHS is currently reviewing activities under the “health resources” jurisdiction for priorities and allocations support to promote the national defense, under the authority of the DPA and Executive Order 13603. HHS may exercise its priorities and allocations authorities for items or services that fall under the current approved programs, while the review for activities under the “health resources” jurisdiction is ongoing.

The Defense Production Act Reauthorization (DPAR) of 2009 required that HHS, and all other agencies that previously have been delegated priorities and allocations authority under E.O. 13603, publish regulations providing standards and procedures for prioritization of contracts and orders and for allocation of materials, services, and facilities to promote the national defense under both emergency and nonemergency conditions. HHS's regulation, along with regulations promulgated by other agencies, are part of the Federal Priorities and Allocations System (FPAS).

On October 1, 2018, Congress amended the DPA through the John S. McCain National Defense Authorization Act (Pub. L. 115-232) which extended non-permanent provisions through September 30, 2025. Section 101(d) of the DPA, as amended, directs all agencies to which the President has delegated priorities and allocations authority under E.O. 13603 to publish final rules establishing standards and procedures by which that authority will be used to promote the national defense in both emergency and non-emergency situations. The DPAR also required all such agencies to consult with the heads of other Federal agencies as appropriate and to the extent practicable to develop a consistent and unified FPAS. This rulemaking is one of several rules published to implement section 101 of the DPA. The rules of the agencies with such authorities, which are the Departments of Commerce, Energy, Transportation, Health and Human Services, Homeland Security, Defense, and Agriculture, comprise the FPAS. HHS is publishing this NPRM rule in compliance with section 101(d) of the DPA. HHS's HRPAS provisions are consistent with the FPAS regulations issued by other agencies to the extent practicable.

The HRPAS, as part of the FPAS, has two principal components: priorities and allocations. Under the priorities component, contracts and orders between the government and private parties or between private parties for the production or delivery of health resources are required to be given priority over other contracts to facilitate expedited production and delivery in promotion of the U.S. national defense. Under the allocations component, materials, services, and facilities may be allocated to promote the national defense. For both components, the term “national defense” ' is defined broadly and includes emergency preparedness activities conducted pursuant to title VI of the Stafford Act and critical infrastructure protection and restoration priorities authorities. Priorities, allocations, and other authorities delegated to the Secretary in E.O. 13603, but not covered by this regulation may be re-delegated by the Secretary. The Secretary delegated the authority for DO priority ratings to the ASPR. The Secretary retains the authority for DX priority ratings and for allocations.

a. HHS's interim final rule had a 60-day comment period that ended on September 15, 2015. HHS received no comments on the Interim Final Rule. Based on interagency review and internal deliberations, HHS made minor revisions to its Interim Final Rule and is issuing this NPRM to seek public comments based on its use of these authorities to respond to COVID-19 and the infant formula shortage.

(1) Section 101.1, Purpose, is revised to add livestock resources, veterinary resources, and plant health resources.

(2) Section 101.20, Definitions, is revised to include a new definition of priority rating and program identification symbol, and add a definition of “working day.”

(3) Section 101.30, Delegation of Authority, is revised to include the delegation of DO priority rating authority of the DPA, and section 201 of E.O. 13603, from the Secretary of HHS to the Assistant Secretary for Preparedness and Response (the ASPR).

(4) Section 101.63, Letters and Memoranda of Understanding is revised to delete references to Memoranda.

b. Analysis of Technical Comments: Several editorial changes were made to the rule and are summarized below.

(a) Section 101.33. The acceptance and rejection times for rated orders are revised. The preamble section of the interim final rule was inconsistent with the provisions in §§ 101.32 and 101.33 with respect to the time limits for acceptance and rejection of rated orders. Most rated orders will continue to require acceptance or rejection within 10 or 15 days depending on the type of rating. Rated orders placed in support of emergency preparedness requirements may require acceptance or rejection within a shorter timeframe that is specified in the rated order. The minimum times for acceptance or rejection that such orders may specify are six (6) hours for emergencies that have occurred, or 12 hours if needed to prepare for an imminent hazard. Also, “time limit in” has been changed to “minimum times,” which is the correct terminology.

(b) Section 101.33(d)(2). Customer notification requirements require persons who have accepted a rated order to give notice if performance will be delayed. The time limit to provide written confirmation of a verbal notice is five (working) days; the time limit is revised to one (1) working day to provide written confirmation of a verbal notice. HHS believes that the nature of rated orders supporting national defense requirements, including COVID-19 response activities, justifies expeditious communications and that once a verbal notice of delayed performance has been given, putting that notice into writing should not take more than one working day.

Sections 101.51 and 101.51(a) are revised to conform with language in the other FPAS regulations and comply with the requirement in section 101(d)(2) of the DPA for the regulations to be consistent and unified.

Section 101.53. Revised § 101.53 to change “is requiring” to “as established.” The rationale for this change is that “is requiring” implies that the allocations process is a constant obligation.

(a). Section 101.54(e) is revised to include a new element to be included in an allocation order that gives constructive notice through publication in the Federal Register . A statement that reads in substance: “This is an allocation order certified for national defense use. [Insert the name(s) of the person(s) to whom the order applies or a description of the class of persons to whom the order applies] is (are) required to comply with this order, in accordance with the provisions of the Health Resources Priorities and Allocations System regulation (45 CFR part 101).

(a) Section 101.63. “Memorandums of Understanding” (MOUs) are universally known in the Federal Government as an agreement between agencies/parties, sometimes completed under the Economy Act, and the use of MOUs in implementing priorities authorities could cause confusion. Therefore, the terms “Memorandum of Understanding” or “Memoranda of Understanding” in § 101.63 and other sections in the interim rule are deleted.

(b) Section 101.1 Purpose

Section 101.1 revises the sentence regarding guidance and procedures for use of DPA authorities to include livestock, veterinary resources, plant health resources, and all forms of energy. In addition, HHS deleted reference to 32 CFR part 555, referring to priorities and allocations for water resources.

(c) Section. 101.3 Program Eligibility

Section 101.3 is revised to delete “deployment and sustainment of military forces,” to track with section 702(14) of the DPA.

(d) Section 101.20 Definitions

(1) Revise definition of “National defense” to delete “health” and add “energy” to track definition of “national defense” in section 702(14) of the DPA.

(2) Add the following definition: “Food resources” means “all commodities and products (simple, mixed, or compound), or complements to such commodities of products, that are capable of being ingested by other human beings or animals, irrespective of other uses to which such commodities or products may be put, at all stages of processing from the raw commodity to the products thereof in vendible form for human or animal consumption. `Food resources' also means potable water packaged in commercially marketable containers, all starches, sugars, vegetable and animal or marine fats and oils, seed, cotton, hemp, and flax fiber, but does not mean any such material after it loses its identity as an agricultural commodity or agriculture product.”

(3) Add the following definition: “Farm equipment” means “equipment, machinery, and repair parts manufactured for use on farms in connection with the production or preparation for market use of food resources.”

(4) Add the following definition: “Fertilizer” means “any product or combination of products that contain one or more of the elements nitrogen, phosphorous, and potassium for use as a plant nutrient.”

(5) Add the following definition: “Food resource facilities” means “plants, machinery, vehicles (including on farm), and other facilities required for the production, processing, distribution, and storage (including cold storage) of food resources, and for the domestic distribution of farm equipment and fertilizer (excluding transportation thereof).”

(6) Delete sentence stating, “Natural resources such as oil and gas,” from the definition of “Materials.”

(7) Revise definition of person to include, “and for purposes of administration of this part, includes the Federal Government and any authorized foreign government or international organization or agency thereof, delegated authority as provided in this part.”

(8) Add the following definition: “Priority rating is an identifying code assigned by a Delegate Agency or authorized person placed on all rated orders and consisting of the rating symbol and program identification symbol.”

(9) Add the following definition: “Working day means any day that the recipient of an order is open for business.”

e. Sec. 101.30 Delegations of Authority

Revised to change “priority rating activities” to “priorities authorities” to track E.O. 13603.

f. Section 101.31 Priority ratings.

(1) Paragraph (a)(1), Levels of priority is revised to change “Federal” to “Health Resources” because agency regulations establish priority levels.

g. Section 101.32 Elements of a rated order.

(2) Paragraph (d)(2)(i). The preamble discussion of § 101.33 is revised to correct the 2-day time frame for acceptance or rejection of rated orders for emergency preparedness to be consistent with §§ 101.32 and 101.33.

h. Section 101.33 Acceptance and rejection of rated orders.

Paragraph (e). The discussion of § 101.33 of the preamble of the interim final rule is inconsistent with the 2-day time frame for acceptance or rejection of rated orders in § 101.33. The preamble is revised to correct this inconsistency.

i. Section 101.37 Use of rated orders.

(1) Paragraph (a)(4) “Facilities needed to produce rated orders, and” is deleted because “facilities” are considered an industrial resource and not eligible for priorities and allocations under the HHS-administered HRPAS regulation.

j. Section 101.38 Limitations on placing rated orders.

(1) Paragraph (b)(1). Revising paragraph (b)(1) to insert “livestock resources, veterinary resources, and plant health resources,” to track E.O. 13603.

(2) Paragraph (b)(2). Revising paragraph (b)(2) to add “All forms of energy” in lieu of “Energy supplies,” to track E.O. 13603.

(3) Paragraph (b)(5). Adding the following paragraph (5): “All materials, services, and facilities, including construction materials (industrial resources) for which the authority has not been delegated to other agencies under E.O. 13603 (Resource agency with jurisdiction—Department of Commerce)” because Commerce was not mentioned in the interim final rule and paragraph (5) is added.

(4) Paragraph (b)(6). Changing former paragraph (b)(5) (now paragraph (b)(6)) to read as follows: “The priorities and allocations authority of this part may not be applied to communications services (Resource agency with jurisdiction—National Communications System under E.O. 13618 of July 6, 2012.)”

k. Section 101.40 General Provisions.

Paragraph (a). Revising the introductory sentence of paragraph(a) to read “Once a priority rating has been authorized pursuant to this part, further action by the Department of Health and Human Services generally is not needed.” The rationale for this change is once a rating is authorized, in most instances, no further action is required by HHS.

l. Section 101.60 General Provisions.

Paragraph (b). Revising paragraph (b) to replace “Memoranda” of Understanding with “Letters.”

m. Section 101.62 Directives.

Paragraph (d). Deleting paragraph (d) relating to an Allocation Directive,” as it was deleted in the Department of Commerce's final rule.

n. Section 101.63 Letters and Memoranda of Understanding.

Revising § 101.63 to delete “and Memoranda” in paragraphs (a) and (b).

o. Section 101.74 Violations, penalties, and remedies.

Paragraph (a). The sentence “The maximum penalties provided by the Selective Service Act and related statutes are a $50,000 fine, or three years in prison, or both,” is deleted because HHS has not been delegated authority under the Selective Service Act, and the sentence, as well as the reference to the Selective Service Act earlier in this paragraph, have been deleted.

(1) Executive Orders 12866 (“Regulatory Planning and Review”) and 13563 (“Improving Regulation and Regulatory Review”) direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This NPRM has been drafted and reviewed in accordance with E.O. 12866. This proposed rule has been designated a “significant regulatory action” by the Office of Management and Budget's (OMB) Office of Information and Regulatory Affairs, under section 3(f)(1)) of E.O. 12866. Accordingly, the rulemaking has been reviewed by the OMB.

(2) This NPRM adopts the interim final rule that established standards and procedures by which HHS may require certain contracts or orders that promote the national defense be given priority over other contracts or orders and setting new standards and procedures by which HHS may allocate materials, services, and facilities to promote the national defense under emergency and non-emergency conditions pursuant to section 101 of the DPA of 1950, as amended. Accordingly, relative to a post-interim final rule baseline, this NPRM has limited economic impact.

The Regulatory Flexibility Act (5 U.S.C. 601 et seq. ) requires preparation of an initial regulatory flexibility analysis for any rule that by law must be proposed for public comment, unless the agency certifies that the rule, if promulgated, will not have a significant economic impact on a substantial number of small entities. HHS reviewed this NPRM under the provisions of the Regulatory Flexibility Act and has determined that this rulemaking, if promulgated, will not have a significant impact on a substantial number of small entities.

(a) Small entities include small businesses, small organizations, and small governmental jurisdictions. For purposes of assessing the impacts of this final rule on small entities, a small business, as described in the Small Business Administration's Table of Small Business Size Standards Matched to North American Industry Classification System Codes (January 2022 Edition), has a maximum annual revenue of $33.5 million and a maximum of 1,500 employees (for some business categories, these numbers are lower). A small governmental jurisdiction is a government of a city, town, school district or special district with a population of less than 50,000. A small organization is any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.

(b) This rulemaking sets criteria under which HHS (or agencies to which HHS delegates HHS's DPA authority to issue rated orders) will authorize prioritization of certain contracts or orders for health resources as well as criteria under which HHS will issue orders allocating materials, services, and facilities. Because the rulemaking affects specific commercial transactions, HHS believes that small non-profit organizations and small governmental jurisdictions are unlikely to be directly affected by this rulemaking.

(c) Prior to the COVID-19 pandemic, HHS had minimally exercised its prioritization authority for contracts and orders and had not exercised its allocation authorities. To date, HHS has exercised title I priorities authorities approximately 70 times in responding to the COVID-19 pandemic to prioritize contracts thus ensuring rapid industrial mobilization for critical health resources (including N95 facemasks, vaccines, therapeutics, and diagnostics) to meet urgent emergency preparedness and response requirements. In response to the initial wave of the COVID-19 pandemic, HHS leveraged its allocations authority, in conjunction with a DX rated order, to re-distribute N-95 facemasks that were seized by the U.S. Customs and Border Protection. Several health resource materials have been identified as essential in responding to the COVID-19 pandemic and these items, such as personal protective equipment (PPE), ventilators, medical countermeasures, and ancillary supplies are in high demand. Therefore, a priority rating was necessary to provide the quantities of these health resources within a specified timeframe to respond to the COVID-19 pandemic. Additionally, in response to the infant formula shortage in the summer of 2023, HHS issued three priority rated orders to help ensure timely delivery of key ingredients to infant formula manufacturers.

(a) The NPRM has two principal components: prioritization and allocation. Under prioritization, HHS, or its Delegate Agency, designates certain orders as one of two possible priority levels. Once so designated, such orders are referred to as “rated orders.” The recipient of a rated order must give it priority over an unrated order or an order with a lower priority rating as necessary to meet the delivery requirement of the rated order. A recipient of a rated order must place orders at the same priority level with suppliers and subcontractors for supplies and services necessary to fulfill the recipient's rated order. The suppliers and subcontractors must treat the request from the rated order recipient as a rated order with the same priority level as the original rated order. The rulemaking does not require recipients to fulfill rated orders if the price or terms of sale are not consistent with the price or terms of sale of similar non-rated orders. The rulemaking provides protection against claims for actions taken in, or inactions required for, compliance with the rulemaking.

(b) Although rated orders could require a firm to fill one order prior to filling another, they will not necessarily require a reduction in the total volume of orders. The regulations also do not require the recipient of a rated order to reduce prices or provide rated orders with more favorable terms than a similar non-rated order. Under these circumstances, the economic effects on the rated order recipient of substituting one order for another are likely to be mutually offsetting, resulting in no net economic impact.

(c) Allocations could be used to control the general distribution of materials or services in the civilian market. Specific allocation actions that HHS might take are as follows:

1. Set-aside: an official action that requires a person to reserve materials, services, or facilities capacity in anticipation of receipt of rated orders.

2. Directive: an official action that requires a person to take or refrain from taking certain actions in accordance with its provisions. A directive can require a person to stop or reduce production of an item; prohibit the use of selected materials, services, or facilities; or divert the use of materials, services, or facilities from one purpose to another.

3. Allotment: an official action that specifies the maximum quantity of a material, service, or facility authorized for a specific use to promote the national defense.

(d) In response to the initial wave of the COVID-19 pandemic, HHS leveraged its allocations authority, in conjunction with a DX rated order to re-distribute N-95 facemasks that were seized by the U.S. Customs and Border Protection. Any future allocations actions would be used only in extraordinary circumstances. As required by section 101(a)(2) of the DPA and by section 201(a)(3) of E.O. 13603, HHS may implement allocations only if the materials, services, and facilities are deemed necessary or appropriate to promote the national defense. “National defense” covers programs for military and energy production or construction, military or critical infrastructure assistance to any foreign nation, homeland security, stockpiling, space, and any related activity. Such terms include emergency preparedness activities conducted pursuant to title VI of the Stafford Act and critical infrastructure protection and restoration.

(e) Any allocation actions taken by HHS must assure that small business concerns shall be accorded, to the extent practicable, a fair share of the materials or services covered by the allocation action, in proportion to the share received by small business concerns under normal conditions, giving such special consideration as may be possible to emerging business concerns. 50 U.S.C. 4551(e).

(f) Although HHS cannot precisely determine the number of small entities that will be affected by this rulemaking, HHS believes that the overall impact on such entities will not be significant. In most instances, rated contracts or orders will be fulfilled in addition to other (unrated) contracts or orders and, in some instances might actually increase the total amount of business of the firm that receives a rated contract or order.

(g) Because allocations can be imposed only after a finding required under section 101(b) of the DPA, and approved by the President in accordance with section 201(e) of E.O. 13603, that such material is a scarce and critical material essential to the national defense and that the requirements of the national defense for such material cannot otherwise be met without creating a significant dislocation of the normal distribution of such material in the civilian market to such a degree as to create appreciable hardship, and because HHS has only used its allocations authority one time in response to the initial wave of COVID-19, one can expect allocations will be ordered only in rare and unique circumstances. Any allocation actions would also have to comply with section 701(e) of DPA (50 U.S.C. 4551(e)), which provides that small business concerns be accorded, to the extent practicable, a fair share of the material, including services, in proportion to the share received by such business concerns under normal conditions, giving such special consideration as may be possible to emerging business concerns.

Therefore, HHS believes that the requirement for a finding under section 101(b) of the DPA, and approved by the President in accordance with section 201(e) of E.O. 13603, that such a material is a scarce and critical material essential to the national defense and that the requirements of the national defense for such material cannot otherwise be met without creating a significant dislocation of the normal distribution of such material in the civilian market to such a degree as to create appreciable hardship and the provisions of section 701 of the DPA indicate that any impact on small business will not be significant.

(h) For the reasons set forth above, the Secretary of HHS certifies that this NPRM will not have a significant economic impact on a substantial number of small entities.

Abstract: HRPAS will efficiently place priority ratings on contracts or orders of health resources within its authority as specified in the DPA, as amended, when necessary. Applicants will request authorization from HHS/ASPR to place a rating on a contract for health resources to support national defense activities. Applicants must supply, at time of request, their name, location, contact information, items for which the applicant is requesting assistance on, quantity of items for which the applicant is requesting assistance on, and delivery date. Applicants can submit the request by mail or email.

Estimate of Burden: Public reporting for this collection of information is estimated to average 30 minutes per response.

Type of Respondents: Individuals, businesses, and agencies with responsibilities for emergency preparedness and response.

Estimated Number of Respondents: 100.

Estimated Number of Responses per Respondents: 0.95.

Estimated Total Number of Respondents: 95.

Estimate Total Annual Burden Hours on Respondents: 50 hours.

We are requesting comments on all aspects of this information collection to help us: (1) Evaluate whether the collection of information is necessary for the proper performance of the functions of HHS, including whether the information will have practical utility; (2) Evaluate the accuracy of HHS's estimate of burden, including the validity of the methodology and assumptions used; (3) Enhance the quality, utility and clarity of the information to be collected; and (4) Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology. All comments received in response to this document, including names and addresses, when provided, will be a matter of public record.

HHS reviewed this proposed rule pursuant to E.O. 13132, “Federalism,” 64 FR 43255 (August 4, 1999), which imposes certain requirements on agencies formulating and implementing policies or regulations that preempt State law or that have federalism implications. HHS determined that the rulemaking will not have a substantial direct effect on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of Government.

Title II of the Unfunded Mandate Reform Act of 1995 (UMRA, Pub. L. 104-4) requires Federal agencies to assess the effects of their regulatory actions on State, Local, Tribal, or Territorial governments or the private sector. Agencies generally must prepare a written statement, including a cost benefit analysis, for proposed and final rules with Federal mandates that may result in expenditures of $100 million or more in any one year for State, Local, Tribal, or Territorial governments, in the aggregate, or to the private sector. This proposed rule contains no Federal mandates as defined by title II of UMRA for State, local, or Tribal governments or for the private sector; therefore, this proposed rule is not subject to the requirements of sections 202 and 205 of Unfunded Mandate Reform Act.

The Secretary of Health and Human Services has approved publication of this NPRM.

For the reasons stated in the preamble, HHS is revising part 101 of title 45 of the Code of Federal Regulations as follows:

Table of Contents for Preamble I. Public Participation and Request for Comments II. Abbreviations III. Executive Summary IV. Basis and Purpose V. Background VI. Summary of the Ratemaking Methodology VII. Historic Methodological and Other Changes VIII. Individual Target Pilot Compensation Benchmark IX. Discussion of Proposed Rate Adjustments District One A. Step 1: Recognize Previous Operating Expenses B. Step 2: Project Operating Expenses, Adjusting for Inflation or Deflation C. Step 3: Estimate Number of Registered Pilots and Apprentice Pilots D. Step 4: Determine Target Pilot Compensation Benchmark and Apprentice Pilot Wage Benchmark E. Step 5: Project Working Capital Fund F. Step 6: Project Needed Revenue G. Step 7: Calculate Initial Base Rates H. Step 8: Calculate Average Weighting Factors by Area I. Step 9: Calculate Revised Base Rates J. Step 10: Review and Finalize Rates District Two A. Step 1: Recognize Previous Operating Expenses B. Step 2: Project Operating Expenses, Adjusting for Inflation or Deflation C. Step 3: Estimate Number of Registered Pilots and Apprentice Pilots D. Step 4: Determine Target Pilot Compensation Benchmark and Apprentice Pilot Wage Benchmark E. Step 5: Project Working Capital Fund F. Step 6: Project Needed Revenue G. Step 7: Calculate Initial Base Rates H. Step 8: Calculate Average Weighting Factors by Area I. Step 9: Calculate Revised Base Rates J. Step 10: Review and Finalize Rates District Three A. Step 1: Recognize Previous Operating Expenses B. Step 2: Project Operating Expenses, Adjusting for Inflation or Deflation C. Step 3: Estimate Number of Registered Pilots and Apprentice Pilots D. Step 4: Determine Target Pilot Compensation Benchmark and Apprentice Pilot Wage Benchmark E. Step 5: Project Working Capital Fund F. Step 6: Project Needed Revenue G. Step 7: Calculate Initial Base Rates H. Step 8: Calculate Average Weighting Factors by Area I. Step 9: Calculate Revised Base Rates J. Step 10: Review and Finalize Rates X. Regulatory Analyses A. Regulatory Planning and Review B. Small Entities C. Assistance for Small Entities D. Collection of Information E. Federalism F. Unfunded Mandates G. Taking of Private Property H. Civil Justice Reform I. Protection of Children J. Indian Tribal Governments K. Energy Effects L. Technical Standards M. Environment I. Public Participation and Request for Comments

The Coast Guard views 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.

Submitting comments. We encourage you to submit comments through the Federal Decision Making Portal at www.regulations.gov. To do so, go to www.regulations.gov, type USCG-2023-0438 in the search box and click “Search.” Next, look for this document in the Search Results column, and click on it. Then click on the Comment option. If you cannot submit your material by using www.regulations.gov, call or email the person in the FOR FURTHER INFORMATION CONTACT section of this proposed rule for alternate instructions.

Viewing material in docket. To view documents mentioned in this proposed rule as being available in the docket, find the docket as described in the previous paragraph, and then select “Supporting & Related Material” in the Document Type column. Public comments will also be placed in our online docket and can be viewed by following instructions on the www.regulations.gov Frequently Asked Questions web page. This web page also explains how to subscribe for email alerts that will notify you when comments are posted or if a final rule is published. 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.

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

Public meeting. We do not plan to hold a public meeting, but we will consider doing so if we determine from public comments that a meeting would be helpful. We would issue a separate Federal Register notice to announce the date, time, and location of such a meeting.

In accordance with Title 46 of the United States Code (U.S.C.), Chapter 93, 1 the Coast Guard regulates pilotage for oceangoing vessels on the Great Lakes and St. Lawrence Seaway—including setting the rates for pilotage services and adjusting them on an annual basis for the upcoming shipping season. The shipping season begins when the locks open in the St. Lawrence Seaway, which allows traffic access to and from the Atlantic Ocean. The opening of the locks varies annually, depending on waterway conditions, but is generally in March or April. The rates, which for the 2024 season range from a proposed $413 to $925 per pilot hour (depending on which of the specific 6 areas pilotage service is provided), are paid by shippers to the pilot associations. The three pilot associations, which are the exclusive U.S. source of registered pilots on the Great Lakes, use this revenue to cover operating expenses, maintain infrastructure, compensate apprentice and registered pilots, acquire and implement technological advances, train new personnel, and provide for continuing professional development.

In accordance with statutory and regulatory requirements, the Coast Guard employs the ratemaking methodology introduced in 2016 and finalized in 2023. Our ratemaking methodology calculates the revenue needed for each pilotage association (operating expenses, compensation for the number of pilots, and anticipated inflation), and then divides that amount by the expected demand for pilotage services over the course of the coming year to produce an hourly rate. This is a 10-step methodology to calculate rates, which is explained in detail in section VI., Summary of the Ratemaking Methodology, in the preamble to this proposed rule.

In this notice of proposed rulemaking (NPRM), we are conducting our annual review and interim adjustment to the base pilotage rates for 2024. The Coast Guard last conducted a full ratemaking in 2023, with the “Great Lakes Pilotage Rates—2023 Annual Ratemaking and Review of Methodology” final rule (hereafter the “2023 final rule”) (88 FR 12226, published February 27, 2023). 2 Per title 46 of the Code of Federal Regulations (CFR), section 404.100(b), via this NPRM, the Coast Guard's Director of the Great Lakes Pilotage (“the Director”) proposes to establish base pilotage rates by an interim ratemaking pursuant to §§ 404.101 through 404.110.

The Coast Guard sets base rates to meet the goal of promoting safe, efficient, and reliable pilotage service on the Great Lakes by generating sufficient revenue for each pilotage association to reimburse its necessary and reasonable operating expenses, fairly compensate trained and rested pilots, and provide appropriate funds to use for improvements. A 10-year average is used when calculating traffic to smooth out anomalies caused by unexpected events, such as those caused by the COVID-19 pandemic. The Coast Guard estimates that this proposed rule would result in $1,914,438 of additional costs. This represents an increase in revenue needed for target pilot compensation, an increase in revenue needed for the total apprentice pilot wage benchmark, an increase in the revenue needed for adjusted operating expenses, and an increase in the revenue needed for the working capital fund.

Based on the ratemaking model discussed in this NPRM, the Coast Guard is proposing the rates shown in table 1.

This proposed rule would affect 56 U.S. Great Lakes pilots, 7 apprentice pilots, 3 pilot associations, and the owners and operators of an average of 277 oceangoing vessels that transit the Great Lakes annually. This proposed rule is not economically significant under Executive Order 12866 and would not affect the Coast Guard's budget or increase Federal spending. The estimated overall annual regulatory economic impact of this rate change would be a net increase of $1,914,438 in estimated payments made by shippers during the 2024 shipping season. This proposed rule would establish the 2024 yearly target compensation for pilots on the Great Lakes at $442,403 per pilot (a $18,005 increase, or 4.24 percent, over their 2023 target compensation). Because the Coast Guard must review, and, if necessary, adjust rates each year, we analyze these as single-year costs and do not annualize them over 10 years. Section X., Regulatory Analyses, in this preamble provides the regulatory impact analyses of this proposed rule.

The legal basis of this rulemaking is 46 U.S.C. Chapter 93, 3 which requires foreign merchant vessels and United States vessels operating “on register” (meaning United States vessels engaged in foreign trade) to use United States or Canadian pilots while transiting the United States waters of the St. Lawrence Seaway and the Great Lakes system. 4 For U.S. Great Lakes pilots, the statute requires the Secretary to “prescribe by regulation rates and charges for pilotage services, giving consideration to the public interest and the costs of providing the services.”  5 The statute requires that rates be established or reviewed and adjusted each year, no later than March 1. 6 The statute also requires that base rates be established by a full ratemaking at least once every 5 years, and, in years when base rates are not established, they must be reviewed and, if necessary, adjusted. 7 The Secretary's duties and authority under 46 U.S.C. Chapter 93 have generally been delegated to the Coast Guard. 8

Each pilot association is an independent business and is the sole provider of pilotage services in its district of operation. Each pilot association is responsible for funding its own operating expenses, maintaining infrastructure, compensating pilots and apprentice pilots, 9 acquiring and implementing technological advances, and training personnel and partners.

The Coast Guard uses a 10-step ratemaking methodology to derive a pilotage rate, based on the estimated amount of traffic, which covers these expenses. 10 The methodology is designed to measure how much revenue each pilotage association would need to cover expenses and to provide competitive compensation to registered pilots. Since the Coast Guard cannot guarantee demand for pilotage services, target pilot compensation for registered pilots is a goal. The actual demand for service dictates the actual compensation for the registered pilots. We then divide that amount by the historic 10-year average for pilotage demand. We recognize that, in years where traffic is above average, pilot associations will accrue more revenue than projected while, in years where traffic is below average, they will take in less. We believe that, over the long term, however, this system ensures that infrastructure will be maintained, and that pilots will receive adequate compensation and work a reasonable number of hours, with adequate rest between assignments, to ensure retention of highly trained personnel.

The purpose of this proposed rule is to issue new pilotage rates for the 2024 shipping season. The Coast Guard believes that the new rates will continue to promote our goal, as outlined in 46 CFR 404.1, of promoting safe, efficient, and reliable pilotage service in the Great Lakes by generating sufficient revenue for each pilotage association to reimburse its necessary and reasonable operating expenses, fairly compensate trained and rested pilots, and provide appropriate funds to use for improvements.

Pursuant to 46 U.S.C. 9303, the Coast Guard regulates shipping practices and rates on the Great Lakes. Under Coast Guard regulations, all vessels engaged in foreign trade (often referred to as “salties”) are required to engage United States or Canadian pilots during their transit through the regulated waters. 11 United States and Canadian “lakers,” which account for most commercial shipping on the Great Lakes, are not affected. 12 Generally, vessels are assigned a United States or Canadian pilot, depending on the order in which they transit a particular area of the Great Lakes, and do not choose the pilot they receive. If a vessel is assigned a U.S. pilot, that pilot will be assigned by the pilotage association responsible for the district in which the vessel is operating, and the vessel operator will pay the pilotage association for the pilotage services. The Great Lakes Pilotage Authority (Canadian) (GLPA) establishes the rates for Canadian registered pilots.

The U.S. waters of the Great Lakes and the St. Lawrence Seaway are divided into three pilotage districts. Pilotage in each district is provided by an association certified by the Director to operate a pilotage pool. The Saint Lawrence Seaway Pilotage Association (SLSPA) provides pilotage services in District One, which includes all U.S. waters of the St. Lawrence River and Lake Ontario. The Lakes Pilots Association (LPA) provides pilotage services in District Two, which includes all U.S. waters of Lake Erie, the Detroit River, Lake St. Clair, and the St. Clair River. Finally, the Western Great Lakes Pilots Association (WGLPA) provides pilotage services in District Three, which includes all U.S. waters of the St. Mary's River; Sault Ste. Marie Locks; and Lakes Huron, Michigan, and Superior.

Each pilotage district is further divided into “designated” and “undesignated” areas, depicted in table 2. Designated areas, classified as such by Presidential Proclamation, are waters in which pilots must direct the navigation of vessels at all times. 13 Undesignated areas are open bodies of water not subject to the same pilotage requirements. While working in undesignated areas, pilots must “be on board and available to direct the navigation of the vessel at the discretion of and subject to the customary authority of the master.”  14 For these reasons, pilotage rates in designated areas can be significantly higher than those in undesignated areas. Table 2 shows the districts and areas of the Great Lakes and St. Lawrence Seaway.