[Federal Register Volume 63, Number 166 (Thursday, August 27, 1998)]
[Rules and Regulations]
[Pages 45677-45679]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-22931]


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DEPARTMENT OF AGRICULTURE

Rural Utilities Service

7 CFR Parts 1735 and 1753

RIN 0572-AB43


Year 2000 Compliance, Telecommunications Program

AGENCY: Rural Utilities Service, USDA.

ACTION: Interim rule.

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SUMMARY: This interim rule adds a new regulation to clarify that RUS 
will consider telecommunications systems feasible when writing and 
processing loans only if the system, in addition to being feasible in 
all other respects, is year 2000 compliant. The interim rule is being 
published to further ensure that RUS-financed projects pass the year 
2000 date changeover without service or revenue disruption. By 
clarifying feasibility considerations for loan processing, RUS lays the 
foundation for requests to be made in response to applications 
submitted to satisfy year 2000 compliance demands.

DATES: Effective August 27, 1998.

FOR FURTHER INFORMATION CONTACT: Orren E. Cameron III, Acting Assistant 
Administrator, Telecommunication Program, Rural Utilities Service, 1400 
Independence Ave., SW., STOP 1590, Room 4056, South Building, 
Washington, DC. Telephone: (202) 720-9554. Facsimile: (202) 720-0810.


[[Page 45678]]


SUPPLEMENTARY INFORMATION:

Justification for Interim Rule

    It is the policy of RUS that rules relating to loans, grants, 
benefits, or contracts shall be published for comments notwithstanding 
the exemption of 5 U.S.C. 553, with respect to such rules. However, 
exemptions are permitted where RUS finds, for good cause, that 
compliance would be impracticable, unnecessary, or contrary to the 
public interest.
    RUS finds that good cause exists to publish this rule for effect 
without first soliciting public comment. Some computer-based systems 
are not programmed to handle the change of date from December 31, 1999, 
to January 1, 2000. These ``non-compliant'' systems may adopt an 
incorrect date which can change operating conditions of the system, 
causing it to malfunction with potentially catastrophic results. 
Telecommunications switches could quit processing calls, utility 
billing systems could lose revenue records, and maintenance and 
administration systems could become corrupted. RUS believes it would be 
contrary to the public interest to delay the effectiveness of the rule, 
since it will merely clarify procedures already in effect for 
determining feasibility by seeking assurance that, before loan funds 
are provided, borrowers' systems are year 2000 compliant or will be 
year 2000 compliant within a reasonable time frame. Through this 
interim rule, RUS is undertaking to address with its telecommunications 
borrowers year 2000 compliance issues that may affect the operations of 
RUS-financed rural telecommunications systems, thereby potentially 
affecting telecommunications services that are critical to public 
health and safety and to borrowers' feasibility. RUS believes that this 
program, part of an effort by all USDA Rural Development agencies to 
prevent year 2000 problems, is not controversial and, therefore, does 
not signal a necessity for advance public comment. For these reasons, 
RUS believes that an interim rulemaking is justified.

Classification

    This interim rule has been determined to be not significant, and 
therefore has not been reviewed by the Office of Management and Budget 
under Executive Order 12866.

Civil Justice Reform

    This interim rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. RUS has determined that this interim rule meets 
the applicable standards provided in Sec. 3 of the Executive Order.

Regulatory Flexibility Act

    Pursuant to Sec. 605(b) of the Regulatory Flexibility Act, 5 U.S.C. 
605(b), RUS certifies that this interim rule will not have a 
significant economic impact on a substantial number of small entities 
as distinguished from large entities. The rule does not place any 
mandates on small entities.
    The Regulatory Flexibility Act is intended to encourage Federal 
agencies to utilize innovative administrative procedures in dealing 
with individuals, small businesses, small organizations, and small 
governmental bodies that would otherwise be unnecessarily adversely 
affected by Federal regulations. The provision included in this rule 
will not impact a substantial number of small entities to a greater 
extent than large entities. Therefore, no regulatory flexibility 
analysis under the Regulatory Flexibility Act is necessary.

Paperwork Reduction Act

    This interim rule does not impose new information collection 
requirements for purposes of the Paperwork Reduction Act of 1995 (44 
U.S.C. Chapter 35, as amended) (OMB control number 0572-0079).

Environmental Impact

    RUS has determined that this interim rule will not significantly 
affect the quality of the human environment as defined by the National 
Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.). Therefore, 
this action does not require an environmental impact statement or 
assessment.

Unfunded Mandates

    This interim rule contains no Federal mandates (under the 
regulatory provisions of Title II of the Unfunded Mandate Reform Act) 
for State, local, and tribal governments or the private sector. Thus 
today's rule is not subject to the requirements of sections 202 and 205 
of the Unfunded Mandate Reform Act.

Intergovernmental Review

    This program is excluded from the scope of Executive Order 12372, 
Intergovernmental Consultation. A Notice of Final Rule entitled 
Department Programs and Activities Excluded from Executive Order 12372 
(50 FR 47034) exempts RUS loans and loan guarantees and Rural Telephone 
Bank loans to governmental and non-governmental entities from coverage 
under this Order.

Catalog of Federal Domestic Assistance

    The program described by this interim rule is listed in the Catalog 
of Federal Domestic Assistance Programs under 10.851, Rural 
Telecommunications Loans and Loan Guarantees, and 10.852, Rural 
Telephone Bank Loans. This catalog is available on a subscription basis 
from the Superintendent of Documents, the United States Government 
Printing Office, Washington, DC 20402.

List of Subjects

7 CFR Part 1735

    Accounting, Loan programs--communications, Reporting and 
recordkeeping requirements, Rural areas, Telecommunications.

7 CFR Part 1753

    Communications equipment, Loan programs--communications, Reporting 
and recordkeeping requirements, Rural areas, Telecommunications.

    For the reasons set forth in the preamble, and under the authority 
of 7 U.S.C. 901 et seq., chapter XVII of Title 7 of the Code of Federal 
Regulations is amended as follows:

PART 1735--GENERAL POLICIES, TYPES OF LOANS, LOAN REQUIREMENTS--
TELECOMMUNICATIONS PROGRAM

    1. The authority citation for part 1735 continues to read as 
follows:

    Authority: 7 U.S.C. 901 et seq., 1921 et seq.; Pub. L. 103-354, 
108 Stat. 3178 (7 U.S.C. 6941 et seq.).

    2. In Sec. 1735.22, two new sentences are added at the end of 
paragraph (e) to read as follows:


Sec. 1735.22  Loan security.

* * * * *
    (e) * * * In addition, RUS considers a system to be feasible only 
if the system, in addition to being feasible in all other respects, is 
year 2000 compliant or if the borrower provides RUS with a 
certification, satisfactory to RUS, that the system will be year 2000 
compliant at a reasonable time before December 31, 1999. Year 2000 
compliant means that product performance and function are not affected 
by dates before, during, and after the year 2000.
* * * * *

PART 1753--TELECOMMUNICATIONS SYSTEM CONSTRUCTION POLICIES AND 
PROCEDURES

    1. The authority citation for part 1753 continues to read as 
follows:


[[Page 45679]]


    Authority: 7 U.S.C. 901 et seq., 1921 et seq.

    2. In Sec. 1753.6, a new sentence is added at the end of paragraph 
(c) to read as follows:


Sec. 1753.6   Standards, specifications, and general requirements.

* * * * *
    (c) * * * The materials and equipment must be year 2000 compliant, 
as defined in 7 CFR 1735.22(e).
* * * * *
    Dated: August 12, 1998.
Jill Long Thompson,
Under Secretary, Rural Development.
[FR Doc. 98-22931 Filed 8-26-98; 8:45 am]
BILLING CODE 3410-15-P