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Army Department
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Copyright Office, Library of Congress
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Committee for the Implementation of Textile Agreements
Federal Aviation Administration
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Surface Transportation Board
Fiscal Service
Consult the Reader Aids section at the end of this issue for phone numbers, online resources, finding aids, reminders, and notice of recently enacted public laws.
Agricultural Marketing Service, USDA.
Final rule.
The Department of Agriculture (Department) is adopting, as a final rule, with a minor change, the provisions of an interim final rule which decreased the assessment rate established for the Northwest Fresh Bartlett Pear Marketing Committee (Committee) under Marketing Order No. 931 for the 2000-2001 and subsequent fiscal periods from $0.025 to $0.02 per standard box of fresh Bartlett pears handled. The Committee is responsible for local administration of the marketing order that regulates the handling of fresh Bartlett pears grown in Oregon and Washington. Authorization to assess fresh Bartlett pear handlers enables the Committee to incur expenses that are reasonable and necessary to administer the program. The 2000-2001 fiscal period began on July 1 and ends June 30. The assessment rate will continue in effect indefinitely unless modified, suspended, or terminated.
December 1, 2000.
Teresa L. Hutchinson, Northwest Marketing Field Office, Fruit and Vegetable Programs, AMS, USDA, 1220 SW Third Avenue, suite 385, Portland, OR 97204; telephone: (503) 326-2724, Fax: (503) 326-7440 or George J. Kelhart, Marketing Order Administration Branch, Fruit and Vegetable Programs, AMS, USDA, room 2525-S, P.O. Box 96456, Washington, DC 20090-6456; telephone: (202) 720-2491, Fax: (202) 720-5698.
Small businesses may request information on complying with this regulation by contacting Jay Guerber, Marketing Order Administration Branch, Fruit and Vegetable Programs, AMS, USDA, P.O. Box 96456, room 2525-S, Washington, DC 20090-6456; telephone: (202) 720-2491, Fax: (202) 720-5698, or E-mail: Jay.Guerber@usda.gov.
This rule is issued under Marketing Agreement No. 141 and Order No. 931 (7 CFR part 931), regulating the handling of fresh Bartlett pears grown in Oregon and Washington hereinafter referred to as the “order.” The marketing agreement and order are effective under the Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-674), hereinafter referred to as the “Act.”
The Department of Agriculture is issuing this rule in conformance with Executive Order 12866.
This rule has been reviewed under Executive Order 12988, Civil Justice Reform. Under the marketing order now in effect, fresh Bartlett pear handlers are subject to assessments. Funds to administer the order are derived from such assessments. It is intended that the assessment rate as issued herein will be applicable to all assessable fresh Bartlett pears beginning July 1, 2000, and continuing until modified, suspended, or terminated. This rule will not preempt any State or local laws, regulations, or policies, unless they present an irreconcilable conflict with this rule.
The Act provides that administrative proceedings must be exhausted before parties may file suit in court. Under section 608c(15)(A) of the Act, any handler subject to an order may file with the Secretary a petition stating that the order, any provision of the order, or any obligation imposed in connection with the order is not in accordance with law and request a modification of the order or to be exempted therefrom. Such handler is afforded the opportunity for a hearing on the petition. After the hearing the Secretary would rule on the petition. The Act provides that the district court of the United States in any district in which the handler is an inhabitant, or has his or her principal place of business, has jurisdiction to review the Secretary's ruling on the petition, provided an action is filed not later than 20 days after the date of the entry of the ruling.
This rule continues to decrease the assessment rate established for the Committee for the 2000-2001 and subsequent fiscal periods from $0.025 to $0.02 per standard box of fresh Bartlett pears handled.
The fresh Bartlett pear marketing order provides authority for the Committee, with the approval of the Department, to formulate an annual budget of expenses and collect assessments from handlers to administer the program. The members of the Committee are producers and handlers of fresh Bartlett pears. They are familiar with the Committee's needs and with the costs for goods and services in their local area and are thus in a position to formulate an appropriate budget and assessment rate. The assessment rate is formulated and discussed in a public meeting. Thus, all directly affected persons have an opportunity to participate and provide input.
For the 1999-2000 and subsequent fiscal periods, the Committee recommended, and the Department approved, an assessment rate that would continue in effect from fiscal period to fiscal period indefinitely unless modified, suspended, or terminated by the Secretary upon recommendation and information submitted by the Committee or other information available to the Secretary.
The Committee met on June 1, 2000, and unanimously recommended 2000-2001 expenditures of $81,060 and an assessment rate of $0.02 per standard box of fresh Bartlett pears handled. In comparison, last year's budgeted expenditures were $77,231. The assessment rate of $0.02 is $0.005 less than the rate previously in effect and will reduce the financial burden on handlers. At the previous rate of $0.025 per standard box and with estimated 2000-2001 fresh Bartlett pear shipments of 3,200,000 standard boxes, the projected reserve on June 30, 2001, would have exceeded the level the Committee believes to be adequate to administer the program. The Committee discussed lower assessment rates, but decided that an assessment rate of less than $0.02 would not generate the income necessary to administer the program with an adequate reserve. The decreased assessment rate is expected to
Major expenses recommended by the Committee for the 2000-2001 fiscal period include $44,468 for salaries, $4,847 for office rent, and $3,891 for health insurance. Budgeted expenses for these items in 1999-2000 were $40,433, $5,323, and $4,048, respectively.
The Committee based its recommended assessment rate on the 2000-2001 crop estimate, the 2000-2001 fiscal period expenditures estimate, and the current and projected balance of the operating reserve. With fresh Bartlett pear shipments for 2000-2001 estimated at 3,200,000 standard boxes, the $0.02 per standard box assessment rate should provide $64,000 in assessment income. Income derived from handler assessments, along with $13,060 from the Committee's authorized reserve (currently approximately $32,321) and miscellaneous income ($3,000), will be adequate to cover budgeted expenses. Funds in the reserve (estimated to be $19,261 at the end of the 2000-2001 fiscal period) will be kept within the maximum permitted by the order (approximately one fiscal year's operational expenses; § 931.42).
The assessment rate established will continue in effect indefinitely unless modified, suspended, or terminated by the Secretary upon recommendation and information submitted by the Committee or other available information.
Although this assessment rate is effective for an indefinite period, the Committee will continue to meet prior to or during each fiscal period to recommend a budget of expenses and consider recommendations for modification of the assessment rate. The dates and times of Committee meetings are available from the Committee or the Department. Committee meetings are open to the public and interested persons may express their views at these meetings. The Department will evaluate Committee recommendations and other available information to determine whether modification of the assessment rate is needed. Further rulemaking will be undertaken as necessary. The Department has reviewed and approved the Committee's 2000-2001 budget and will review those for subsequent fiscal periods and approve them as appropriate.
To facilitate communications between the Committee and growers, handlers, and other interested persons, this final rule also updates § 931.110 to include the Committee's current address. The information collection requirements for this order are currently approved under OMB No. 0581-0092 by the Office of Management and Budget in accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35).
Pursuant to requirements set forth in the Regulatory Flexibility Act (RFA), the Agricultural Marketing Service (AMS) has considered the economic impact of this rule on small entities. Accordingly, AMS has prepared this final regulatory flexibility analysis.
The purpose of the RFA is to fit regulatory actions to the scale of business subject to such actions in order that small businesses will not be unduly or disproportionately burdened. Marketing orders issued pursuant to the Act, and the rules issued thereunder, are unique in that they are brought about through group action of essentially small entities acting on their own behalf. Thus, both statutes have small entity orientation and compatibility.
There are approximately 1,800 producers of fresh Bartlett pears in the production area and approximately 65 handlers subject to regulation under the marketing order. Small agricultural producers are defined by the Small Business Administration (13 CFR 121.201) as those having annual receipts of less than $500,000 and small agricultural service firms are defined as those whose annual receipts are less than $5,000,000.
Currently, about 98.5 percent of the fresh Bartlett pear handlers ship under $5,000,000 worth of fresh Bartlett pears and 1.5 percent ship over $5,000,000 worth on an annual basis. In addition, based on acreage, production, and producer prices reported by the National Agricultural Statistics Service, and the total number of fresh Bartlett pear producers, the average annual producer revenue is approximately $9,800. In view of the foregoing, it can be concluded that the majority of fresh Bartlett pear producers and handlers may be classified as small entities, excluding receipts from other sources.
This rule continues to decrease the assessment rate established for the Committee and collected from handlers for the 2000-2001 and subsequent fiscal periods from $0.025 to $0.02 per standard box of fresh Bartlett pears handled. The Committee unanimously recommended 2000-2001 expenditures of $81,060 and an assessment rate of $0.02 per standard box of fresh Bartlett pears handled. In comparison, last year's budgeted expenditures were $77,231. The assessment rate of $0.02 is $0.005 less than the rate previously in effect. At the rate of $0.025 per standard box and with 2000 fresh Bartlett pear shipments estimated at 3,200,000 standard boxes, the projected reserve on June 30, 2001, would have exceeded the level the Committee believes to be adequate to administer the program. The assessment rate reduction would also lessen the financial burden on handlers. The Committee decided that an assessment rate of less than $0.02 would not generate the income necessary to administer the program with an adequate reserve.
Major expenses recommended by the Committee for the 2000-2001 fiscal period include $44,468 for salaries, $4,847 for office rent, and $3,891 for health insurance. Budgeted expenses for these items in 1999-2000 were $40,433, $5,323, and $4,048, respectively.
With fresh Bartlett pear shipments for 2000-2001 estimated at 3,200,000 standard boxes, the $0.02 rate of assessment should provide $64,000 in assessment income. Income derived from handler assessments, along with $13,060 from the Committee's authorized reserve (currently approximately $32,321) and miscellaneous income ($3,000), will be adequate to cover budgeted expenses. Funds in the reserve (estimated to be $19,261 at the end of the 2000-2001 fiscal period) will be kept within the maximum permitted by the order (approximately one fiscal year's operational expenses; § 931.42).
Recent price information indicates that the producer price for the 2000-2001 marketing season will range between $8.60 and $11.30 per standard box of fresh Bartlett pears. Therefore, the estimated assessment revenue for the 2000-2001 fiscal period as a percentage of total producer revenue will range between 0.18 and 0.23 percent.
This action decreases the assessment obligation imposed on handlers. While assessments impose some additional costs on handlers, the costs are minimal and uniform on all handlers. Some of the additional costs may be passed on to producers. However, decreasing the assessment rate reduces the burden on handlers and may reduce the burden on producers.
In addition, the Committee's meeting was widely publicized throughout the fresh Bartlett pear industry and all interested persons were invited to attend the meeting and participate in Committee deliberations on all issues. Like all Committee meetings, the June 1, 2000, meeting was a public meeting and all entities, both large and small, were able to express views on this issue.
This action imposes no additional reporting or recordkeeping requirements on either small or large fresh Bartlett pear handlers. As with all Federal marketing order programs, reports and
The Department has not identified any relevant Federal rules that duplicate, overlap, or conflict with this rule.
An interim final rule concerning this action was published in the
A small business guide on complying with fruit, vegetable, and specialty crop marketing agreements and orders may be viewed at: http://www.ams.usda.gov/fv/moab.html. Any questions about the compliance guide should be sent to Jay Guerber at the previously mentioned address in the
After consideration of all relevant matter presented, including the information and recommendation submitted by the Committee and other available information, it is hereby found that this rule, as hereinafter set forth, will tend to effectuate the declared policy of the Act.
Marketing agreements, Pears, Reporting and recordkeeping requirements.
7 U.S.C. 601-674.
Unless otherwise specifically prescribed in this subpart, or in the marketing agreement and order, or unless otherwise required by the Committee, all reports, applications, submittals, requests, inspection certificates, and communications in connection with the marketing agreement or order shall be forwarded to: Northwest Fresh Bartlett Pear Marketing Committee 4382 SE International Way, Suite A, Milwaukie, OR 97222-4635.
Federal Aviation Administration, DOT.
Final rule.
This amendment adopts a new airworthiness directive (AD) that is applicable to certain International Aero Engines AG (IAE) V2500-A5 and -D5 series turbofan engines, identified by serial number. This amendment requires the removal of engines assembled with an improper High Pressure Turbine (HPT) module configuration from service prior to accumulating 5,100 or 7,600 cycles in the improper configuration, or at the next shop visit, depending on the type of improper HPT configuration, and restoration to type design. This amendment is prompted by reports of engines that do not conform to the engine type design, which could cause a Low Cycle Fatigue (LCF) life reduction of the HPT stage 1 disk. The actions specified by this AD are intended to restore engines to type design configuration and to prevent possible LCF failure of the HPT stage 1 disk, which could result in an uncontained engine failure and damage to the airplane.
Effective December 6, 2000. The incorporation by reference of certain publications listed in the rule is approved by the Director of the Federal Register as of December 6, 2000.
The service information referenced in this AD may be obtained from International Aero Engines AG, 400 Main Street, East Hartford, CT 06108; telephone: (860) 565-5515; fax: (860) 565-5510. This information may be examined at the FAA, New England Region, Office of the Regional Counsel, 12 New England Executive Park, Burlington, MA, or at the Office of the Federal Register, 800 North Capitol Street, NW., suite 700, Washington, DC.
Robert Ganley, Aerospace Engineer, Engine Certification Office, FAA, Engine and Propeller Directorate, 12 New England Executive Park, Burlington, MA 01803-5299; telephone: 781-238-7138, fax: 781-238-7199.
A proposal to amend part 39 of the Federal Aviation Regulations (14 CFR 39) to include an airworthiness directive (AD) that is applicable to International Aero Engines AG V2500-A5 and -D5 series turbofan engines was published in the
Interested persons have been afforded an opportunity to participate in the making of this amendment. Due consideration has been given to the one comment received. The comment states that the manufacturer's service documentation is the root cause of the configuration errors, and that the documentation should be designed to minimize the probability of such errors.
The FAA disagrees. The FAA believes that the manufacturer's service documentation, as currently written, is technically accurate. The documentation should not in itself be considered the root cause for configuration errors. The FAA recognizes that in some instances, service documentation may not be as clear as originally intended. The FAA continues to work with all engine manufacturers to ensure that clear and precise service documents are issued to alleviate any potential confusion by the operators.
No comments were received on the economic impact contained in the proposed rules.
This rule does not have federalism implications, as defined in Executive Order 13132, because it would not have
For the reasons discussed above, I certify that this action (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and (3) will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. A final evaluation has been prepared for this action and it is contained in the Rules Docket. A copy of it may be obtained from the Rules Docket at the location provided under the caption
Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety.
49 U.S.C. 106(g), 40113, 44701.
This airworthiness directive (AD) applies to each engine identified in the preceding applicability provision, regardless of whether it has been modified, altered, or repaired in the area subject to the requirements of this AD. For engines that have been modified, altered, or repaired so that the performance of the requirements of this AD is affected, the owner/operator must request approval for an alternative method of compliance in accordance with paragraph (b) of this AD. The request should include an assessment of the effect of the modification, alteration, or repair on the unsafe condition addressed by this AD; and, if the unsafe condition has not been eliminated, the request should include specific proposed actions to address it.
To restore the engines to type design and to prevent possible low cycle fatigue (LCF) failure of the HPT stage 1 disk, which could lead to an uncontained engine failure and damage to the airplane, accomplish the following:
(a) For those engines identified by serial numbers in Table 1 of this AD, with HPT modules built to configuration X, X′ X*, Y, or Z, remove from service in accordance with Table 1 and restore the HPT module to type design in accordance with IAE All Operators Wire (AOW) 1053, Issue 2, dated June 20, 2000.
(b) An alternative method of compliance or adjustment of the compliance time that provides an acceptable level of safety may be used if approved by the Manager, Engine Certification Office (ECO). Operators shall submit their requests through an appropriate FAA Principal Maintenance Inspector, who may add comments and then send it to the Manager, ECO.
Information concerning the existence of approved alternative methods of compliance with this airworthiness directive, if any, may be obtained from the ECO.
(c) Special flight permits may be issued in accordance with §§ 21.197 and 21.199 of the Federal Aviation Regulations (14 CFR 21.197 and 21.199) to operate the aircraft to a location where the requirements of this AD can be accomplished.
(d) The restoration to type design must be done in accordance with International Aero Engines AOW 1053, Issue 2, dated June 20, 2000. This incorporation by reference was approved by the Director of the Federal Register in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. Copies may be obtained from International Aero Engines AG, 400 Main Street, East Hartford, CT 06108; telephone: (860) 565-5515; fax (860) 565-5510. Copies may be inspected at the FAA New England Region, Office of the Regional Counsel, 12 New England Executive Park, Burlington, MA, or at the Office of the
(e) This amendment becomes effective on December 6, 2000.
Federal Aviation Administration, DOT.
Final rule.
This amendment adopts a new airworthiness directive (AD), applicable to certain Learjet Model 45 series airplanes, that requires repetitive application of grease to the rotating disk assembly of the nose landing gear squat switch mechanism. Application of grease to the squat switch assembly is necessary to prevent moisture contamination and subsequent formation of ice. Such ice formation could result in bending or damaging of the nose landing gear squat switch assembly, which could drive the nose wheel to an uncommanded angle against the force of the steering system. This condition, if not corrected, could result in the airplane departing from the runway at high speeds during landing.
Effective December 6, 2000.
The incorporation by reference of certain publications listed in the regulations is approved by the Director of the Federal Register as of December 6, 2000.
The service information referenced in this AD may be obtained from Learjet Inc., One Learjet Way, Wichita, Kansas 67209-2942. This information may be examined at the Federal Aviation Administration (FAA), Transport Airplane Directorate, Rules Docket, 1601 Lind Avenue, SW., Renton, Washington; or at the FAA, Wichita Aircraft Certification Office, 1801 Airport Road, Room 100, Mid-Continent Airport, Wichita, Kansas; or at the Office of the
Shane Bertish, Aerospace Engineer, Systems and Equipment Branch, ACE-116W, FAA, Small Airplane Directorate, Wichita Aircraft Certification Office, 1801 Airport Road, Room 100, Mid-Continent Airport, Wichita, Kansas 67209; telephone (316) 946-4156; fax (316) 946-4407.
A proposal to amend part 39 of the Federal Aviation Regulations (14 CFR part 39) to include an airworthiness directive (AD) that is applicable to certain Learjet Model 45 series airplanes was published in the
Interested persons have been afforded an opportunity to participate in the making of this amendment. No comments were submitted in response to the proposal or the FAA's determination of the cost to the public.
The FAA has determined that air safety and the public interest require the adoption of the rule as proposed.
This is considered to be interim action. The manufacturer has advised that it currently is developing a modification that will positively address the unsafe condition addressed by this AD. Once this modification is developed and approved, and parts are available, the FAA may consider additional rulemaking.
There are approximately 69 Learjet Model 45 series airplanes of the affected design in the worldwide fleet. The FAA estimates that 45 airplanes of U.S. registry will be affected by this AD, that it will take approximately 1 work hour per airplane to accomplish the required actions, and that the average labor rate is $60 per work hour. Based on these figures, the cost impact of the AD on U.S. operators is estimated to be $2,700, or $60 per airplane, per application.
The cost impact figure discussed above is based on assumptions that no operator has yet accomplished any of
The regulations adopted herein 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. Therefore, it is determined that this final rule does not have federalism implications under Executive Order 13132.
For the reasons discussed above, I certify that this action (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and (3) will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. A final evaluation has been prepared for this action and it is contained in the Rules Docket. A copy of it may be obtained from the Rules Docket at the location provided under the caption
Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety.
49 U.S.C. 106(g), 40113, 44701.
This AD applies to each airplane identified in the preceding applicability provision, regardless of whether it has been modified, altered, or repaired in the area subject to the requirements of this AD. For airplanes that have been modified, altered, or repaired so that the performance of the requirements of this AD is affected, the owner/operator must request approval for an alternative method of compliance in accordance with paragraph (b) of this AD. The request should include an assessment of the effect of the modification, alteration, or repair on the unsafe condition addressed by this AD; and, if the unsafe condition has not been eliminated, the request should include specific proposed actions to address it.
To prevent the airplane from departing the runway at high speeds during landing due to bending and damage to the squat switch assembly of the nose landing gear, accomplish the following:
(a) Within 30 days after the effective date of this AD, apply grease to the rotating disk assembly of the squat switch mechanism of the nose wheel in accordance with Bombardier Aerospace Service Information Letter SIL 32-016, dated March 30, 2000. Thereafter, repeat this application at intervals not to exceed 30 days.
(b) An alternative method of compliance or adjustment of the compliance time that provides an acceptable level of safety may be used if approved by the Manager, Wichita Aircraft Certification Office (ACO), FAA. Operators shall submit their requests through an appropriate FAA Principal Maintenance Inspector, who may add comments and then send it to the Manager, Wichita ACO.
Information concerning the existence of approved alternative methods of compliance with this AD, if any, may be obtained from the Wichita ACO.
(c) Special flight permits may be issued in accordance with §§ 21.197 and 21.199 of the Federal Aviation Regulations (14 CFR 21.197 and 21.199) to operate the airplane to a location where the requirements of this AD can be accomplished.
(d) The application of grease shall be done in accordance with Bombardier Aerospace Service Information Letter SIL 32-016, dated March 30, 2000. This incorporation by reference was approved by the Director of the Federal Register in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. Copies may be obtained from Learjet Inc., One Learjet Way, Wichita, Kansas 67209-2942. Copies may be inspected at the FAA, Transport Airplane Directorate, 1601 Lind Avenue, SW., Renton, Washington; or at the FAA, Wichita Aircraft Certification Office, 1801 Airport Road, Room 100, Mid-Continent Airport, Wichita, Kansas; or at the Office of the Federal Register, 800 North Capitol Street, NW., suite 700, Washington, DC.
(e) This amendment becomes effective on December 6, 2000.
Federal Aviation Administration, DOT.
Final rule; correction.
This document corrects information in an existing airworthiness directive (AD) that applies to certain Boeing Model 737-100, -200, -200C, -300, -400, and -500 series airplanes. That AD supersedes AD 99-05-15, amendment 39-11063, to require a one-time inspection of the attachment nuts at each end attachment of the elevator tab push rods to measure run-on torque values, and corrective actions, if necessary. That AD also requires replacement of all existing bolts and attachment nuts at the forward and aft end attachment of each elevator tab push rod with new bolts and self-locking castellated nuts with cotter pins. This document corrects an inadvertent error regarding the compliance time for certain requirements of that AD. This correction is necessary to provide an adequate compliance time for the replacement of certain parts.
Effective October 25, 2000.
The incorporation by reference of Boeing Service Letter 737-SL-27-118-D, dated December 17, 1999, was approved previously by the Director of the
The incorporation by reference of Boeing Alert Service Bulletin 737-27A1205, dated August 28, 1997, was approved previously by the Director of
Scott Fung, Aerospace Engineer, Airframe Branch, ANM-120S, FAA, Seattle Aircraft Certification Office, 1601 Lind Avenue, SW., Renton, Washington 98055-4056; telephone (425) 227-1221; fax (425) 227-1181.
On September 12, 2000, the Federal Aviation Administration (FAA) issued AD 2000-19-05, amendment 39-11906 (65 FR 56783, September 20, 2000), which applies to certain Boeing Model 737-100, -200, -200C, -300, -400, and -500 series airplanes. That AD supersedes AD 99-05-15, amendment 39-11063, to require a one-time inspection of the attachment nuts at each end attachment of the elevator tab push rods to measure run-on torque values, and corrective actions, if necessary. That AD also requires replacement of all existing bolts and attachment nuts at the forward and aft end attachment of each elevator tab push rod with new bolts and self-locking castellated nuts with cotter pins. That AD was prompted by reports of excessive high-frequency airframe vibration during flight, with consequent structural damage to the elevator tab, elevator, and stabilizer. The actions required by that AD are intended to prevent detachment of an elevator tab push rod due to a detached nut at either end attachment of a push rod, which could result in excessive high-frequency airframe vibration during flight; consequent structural damage to the elevator tab, elevator, and horizontal stabilizer; and reduced controllability of the airplane.
Since the issuance of AD 2000-19-05, the FAA has reviewed the wording in paragraph (b) of that AD and finds that there was an inadvertent error in the compliance time. In the preamble of AD 2000-19-05, the FAA concurred with a commenter's request to extend the compliance time in paragraph (b) from, “Within 12 months or 4,000 flight cycles after the effective date of this AD, whichever occurs first: * * *” to “Within 24 months or 4,000 flight cycles after the effective date of this AD, whichever occurs first: * * *” However, in the final rule the FAA inadvertently retained the proposed compliance time of “Within 12 months * * *” This AD corrects the compliance time for paragraph (b) of that AD to read, “Within 24 months or 4,000 flight cycles after the effective date of this AD, whichever occurs first: * * *”
This document corrects the error and correctly adds the AD as an amendment to § 39.13 of the Federal Aviation Regulations (14 CFR 39.13).
The AD is reprinted in its entirety for the convenience of affected operators. The effective date of the AD remains October 25, 2000.
Since this action only corrects an error, which extends the compliance time in that AD, it has no adverse economic impact and imposes no additional burden on any person. Therefore, the FAA has determined that notice and public procedures are unnecessary.
Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety.
49 U.S.C. 106(g), 40113, 44701.
This AD applies to each airplane identified in the preceding applicability provision, regardless of whether it has been modified, altered, or repaired in the area subject to the requirements of this AD. For airplanes that have been modified, altered, or repaired so that the performance of the requirements of this AD is affected, the owner/operator must request approval for an alternative method of compliance in accordance with paragraph (c)(1) of this AD. The request should include an assessment of the effect of the modification, alteration, or repair on the unsafe condition addressed by this AD; and, if the unsafe condition has not been eliminated, the request should include specific proposed actions to address it.
To prevent detachment of an elevator tab push rod due to a detached nut at either end attachment of a push rod, which could result in excessive high-frequency airframe vibration during flight; consequent structural damage to the elevator tab, elevator, and horizontal stabilizer; and reduced controllability of the airplane; accomplish the following:
(a) Within 90 days after March 23, 1999 (the effective date of AD 99-05-15, amendment 39-11063): Perform a one-time inspection of all attachment nuts at each end of each elevator tab push rod to measure the run-on torque values of the nuts, in accordance with Boeing Alert Service Bulletin 737-27A1205, dated August 28, 1997.
(1) If the run-on torque value of any end attachment nut is within the limits specified in the alert service bulletin, prior to further flight, ensure that the final seating torque of the attachment nuts is within the torque values specified in the alert service bulletin.
(2) If the run-on torque value of any end attachment nut is outside the limits specified in the alert service bulletin, prior to further flight, replace all existing bolts and attachment nuts at each end of each elevator tab push rod with new bolts and self-locking castellated nuts that have cotter pins installed as a secondary locking feature, in accordance with Boeing Service Letter 737-SL-27-118-D, dated December 17, 1999, and ensure that the final seating torque of the nuts is within the torque values specified in the service letter.
Accomplishment of the inspection and ensuring adequate final seating torque values prior to the effective date of this AD in accordance with Boeing All-Base Telex M-7272-97-0897, dated February 13, 1997, are considered acceptable for compliance with the actions specified in paragraphs (a) and (a)(1) of this AD for only the forward attachment nuts.
(b) Within 24 months or 4,000 flight cycles after the effective date of this AD, whichever occurs first: Replace all existing bolts and attachment nuts at the forward and aft end attachment of each elevator tab push rod with new bolts and self-locking castellated nuts that have cotter pins installed as a secondary locking feature, in accordance with Boeing Service Letter 737-SL-27-118-D, dated December 17, 1999.
Replacements accomplished prior to the effective date of this AD in accordance
(c)(1) An alternative method of compliance or adjustment of the compliance time that provides an acceptable level of safety may be used if approved by the Manager, Seattle Aircraft Certification Office (ACO), FAA. Operators shall submit their requests through an appropriate FAA Principal Maintenance Inspector, who may add comments and then send it to the Manager, Seattle ACO.
(2) Alternative methods of compliance, approved previously in accordance with AD 99-05-15, amendment 39-11063, are considered to be approved as alternative methods of compliance with paragraph (a) of this AD only.
Information concerning the existence of approved alternative methods of compliance with this AD, if any, may be obtained from the Seattle ACO.
(d) Special flight permits may be issued in accordance with §§ 21.197 and 21.199 of the Federal Aviation Regulations (14 CFR 21.197 and 21.199) to operate the airplane to a location where the requirements of this AD can be accomplished.
(e) The actions shall be done in accordance with Boeing Alert Service Bulletin 737-27A1205, dated August 28, 1997, and Boeing Service Letter 737-SL-27-118-D, dated December 17, 1999.
(1) The incorporation by reference of Boeing Service Letter 737-SL-27-118-D, dated December 17, 1999, was approved previously by the Director of the Federal Register as of October 25, 2000 (65 FR 56783, September 20, 2000).
(2) The incorporation by reference of Boeing Alert Service Bulletin 737-27A1205, dated August 28, 1997, was approved previously by the Director of the Federal Register as of March 23, 1999 (64 FR 10935, March 8, 1999).
(3) Copies may be obtained from Boeing Commercial Airplane Group, P.O. Box 3707, Seattle, Washington 98124-2207. Copies may be inspected at the FAA, Transport Airplane Directorate, 1601 Lind Avenue, SW., Renton, Washington; or at the Office of the Federal Register, 800 North Capitol Street, NW., suite 700, Washington, DC.
(f) The effective date of this amendment remains October 25, 2000.
Office of the Secretary, Commerce.
Final rule.
This final rule is being issued to adjust each civil monetary penalty provided by law within the jurisdiction of the Department of Commerce (the Department). The Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Debt Collection Improvement Act of 1996, requires the head of each agency to adjust its civil monetary penalties for inflation no later than October 23, 1996, and at least once every four years thereafter. These inflation adjustments will apply only to violations that occur after the effective date of this rule.
This rule is effective November 1, 2000.
Office of Financial Management, Department of Commerce, 14th and Constitution Avenue, MS 6827, Washington, DC 20230.
Lisa Casias, 202-482-0766.
The Federal Civil Penalties Inflation Adjustment Act of 1990, (Pub. L. 101-410), provided for the regular evaluation of civil monetary penalties to ensure that they continued to maintain their deterrent value and that penalty amounts due to the Federal Government were properly accounted for and collected. On April 26, 1996, the Federal Civil Penalties Inflation Adjustment Act of 1990 was amended by the Debt Collection Improvement Act of 1996 (Pub. L. 104-134) to require each agency to issue regulations to adjust its civil monetary penalties (CMP) for inflation at least every four years. The amendment further provides that any resulting increases in a CMP due to the inflation adjustment should apply only to the violations that occur subsequent to the date of the publication in the
On October 24, 1996, the Commerce Department published in the
By this publication CMP are again being adjusted for inflation as prescribed by law. In the case of those CMP listed above that were not previously adjusted, the CMP adjustment in this document is subject to the initial inflation adjustment limitation of ten percent, and each is being adjusted by that amount. Next, in the October 24, 1996, publication, the CMP included in the Atlantic Striped Bass Conservation Act (16 U.S.C. 1851 Note (Sec. 5)(c)(1)), was adjusted from $1,000 to $1,100. Thus, it is no longer subject to the ten percent limitation for first time adjustments. However, in 1997, this CMP was legislatively changed to be the same amount as the CMP established in the Magnuson-Stevens Fishery Conservation and Management Act (16 U.S.C. 1858(a)), which in 1997 was $110,000. As a consequence, the CMP for the Atlantic Striped Bass Conservation Act is being adjusted in this publication from the
A civil monetary penalty is defined as any penalty, fine, or other sanction that:
1. Is for a specific monetary amount as provided by Federal law, or has a maximum amount provided for by Federal law; and,
2. Is assessed or enforced by an agency pursuant to Federal law; and,
3. Is assessed or enforced pursuant to an administrative proceeding or a civil action in the Federal courts.
This regulation adjusts the civil penalties that are established by law and assessed or enforced by the Department.
The actual penalty assessed for a particular violation is dependent upon a variety of factors. For example, the National Oceanic and Atmospheric Administration (NOAA) Civil Administrative Penalty Schedule (the Schedule), a compilation of internal guidelines that are used when assessing penalties for violations for most of the statutes NOAA enforces, will be adjusted in a manner consistent with this regulation to maintain the deterrent effect of the penalties recommended therein. The penalty ranges in the Schedule are intended to aid enforcement attorneys in determining the appropriate penalty to assess for a particular violation. Pursuant to the notice published in the
The inflation adjustment was determined pursuant to the methodology prescribed by Public Law 101-410, which requires the maximum CMP, or the minimum and maximum CMP, as applicable, to be increased by the cost-of-living adjustment. The term “cost-of-living adjustment” was defined in Public Law 104-34 to mean the percentage for each CMP by which the Consumer Price Index (CPI) for June of the calendar year preceding the adjustment exceeds the CPI for the month of June of the calendar year in which the amount of such CMP was last set or adjusted pursuant to law. For the purpose of computing the inflation adjustments, the CPI for June of the calendar year preceding the adjustment means the CPI for June of 1999.
The raw inflation adjustment amounts are required by Public Law 101-410 to be rounded as follows:
1. If the increase is greater than $0 and less than or equal to $100, round to the nearest multiple of $10.
2. If the increase is greater than $100 and less than or equal to $1,000, round to nearest multiple of $100.
3. If the increase is greater than $1,000 and less than or equal to $10,000, round to the nearest multiple of $1,000.
4. If the increase is greater than $10,000 and less than or equal to $100,000, round to the nearest multiple of $5,000.
5. If the increase is greater than $100,000 and less than or equal to $200,000, round to the nearest multiple of $10,000.
6. If the increase is greater than $200,000, round to the nearest multiple of $25,000.
Public Law 101-410 requires each rounded increase to be added to the minimum or maximum penalty amount being adjusted, and the total is the amount of such penalty, as adjusted, subject to the ten percent limitation provided by Public Law 104-134 for the First Adjustments.
It has been determined that this rule is not significant for purposes of Executive Order 12866. The Department for good cause finds that notice and opportunity for comment and the 30-day delayed effective date are unnecessary (5 U.S.C. 553(b)(B) and 5 U.S.C. 553(d)(3)) for this rulemaking. It is unnecessary to ask for notice and comment and delay the effective date because the Debt Collection Improvement Act of 1996 (the Act) requires the head of each agency to adjust its civil monetary penalties for inflation by regulation no later than October 23, 1996, and at least every four years thereafter, and the Federal Civil Monetary Penalty Inflation Adjustment Act of 1990, as amended by the Act, states how to calculate the inflation adjustment. This rule merely adjusts the Department's CMP according to the statutory requirements. The Department does not have any discretion in making the adjustments.
Because notice and opportunity for comment are not required by 5 U.S.C. 553, or any other law, a Regulatory Flexibility Analysis is not required and was not prepared for purposes of the Regulatory Flexibility Act. This rule does not contain information collection requirements for purposes of the Paperwork Reduction Act.
Law enforcement, Penalties.
Sec. 4, as amended, and sec. 5, Pub. L. 101-410, 104 Stat. 890 (28 U.S.C. 2461 note); Pub. L. 104-134, 110 Stat. 1321, 28 U.S.C. 2461 note.
The civil monetary penalties provided by law within the jurisdiction of the respective agencies or bureaus of the
(a) Bureau of Export Administration.
(1) 15 U.S.C. 5408(b)(1), Fastener Quality Act, violation: from $25,000 to $27,500.
(2) 50 U.S.C. 1705(b), International Emergency Economic Powers Act, as invoked by E.O. 12924 (August 19, 1994) and E.O. 12938 (November 14, 1994), Export Administration Regulations violation: from $11,000 to $12,000.
(3) 50 U.S.C. 1707(b), International Emergency Economic Powers Act, as invoked by E.O. 12924 (August 19, 1994) and E.O. 12938 (November 14, 1994), Chemical Weapons Convention Implementation Act (See E.O. 13128, June 25, 1999), Chemical Weapons Convention, Import restriction violation: from $11,000 to $11,000.
(4) 22 U.S.C. 7661(a)(1)(A), Chemical Weapons Convention Implementation Act, Prohibited acts relating to inspection violation: from $25,000 to $25,500.
(5) 22 U.S.C. 7661(a)(1)(B), Chemical Weapons Convention Implementation Act, Record keeping violation: from $5,000 to $5,100.
(6) 50 U.S.C. app. 2410(c), Export Administration Act, See E.O. 12851(June 11, 1993), Non-national security violation: from $11,000 to $12,000.
(7) 50 U.S.C. app. 2410(c), Export Administration Act, See E.O. 12851 (June 11, 1993), and Section 38 Arms Export Control Act, National security violation: from $110,000 to $120,000.
(b) Economic Development Administration.
(1) 19 U.S.C. 2349, Trade Act of 1974, False statement,
(2) [Reserved]
(c) Economics and Statistics Administration (ESA)/Census.
(1) 13 U.S.C. 304, Delinquency on delayed filing of export documentation: from $110 per/day (up to $1,100) to $120 per/day (up to $1,200).
(2) 13 U.S.C. 305, Collection of foreign trade statistics violation: from $1,100 to $1,200.
(d) ESA/Bureau of Economic Analysis.
(1) 22 U.S.C. 3105(a), International Investment and Trade in Services Act, Failure to furnish information: from a minimum of $2,750 to $3,000, and from a maximum of $27,500 to $30,000.
(2) [Reserved]
(e) Import Administration.
(1) 19 U.S.C. 81s, Foreign Trade Zone violation: from $1,100 to $1,200.
(2) 19 U.S.C. 1677f(f)(4), North American Free Trade Agreement Protective Order violation: from $110,000 to $120,000.
(f) National Oceanic and Atmospheric Administration.
(1) 15 U.S.C. 5623(a)(3), Land Remote Sensing Policy Act of 1992, violation: from $10,900 to $11,900.
(2) 15 U.S.C. 5658(c), Land Remote Sensing Policy Act of 1992, violation: from $10,900 to $11,900.
(3) 16 U.S.C. 773f(3), Northern Pacific Halibut Act of 1982, violation: from $27,500 to $30,000.
(4) 16 U.S.C. 783, Sponge Act (1914), violation: from $550 to $600.
(5) 16 U.S.C. 957, Tuna Conventions Act of 1950 (1962):
(i) Violation/subsection c: from $110,000 to $120,000.
(ii) Violation/subsection a: from $27,500 to $30,000.
(iii) Violation/subsection b: from $1,100 to $1,200.
(iv) Subsequent violation/subsection a: from $55,000 to $60,000
(v) Subsequent violation/subsection b: from $5,500 to $6,000
(6) 16 U.S.C. 971e(e)(1), Atlantic Tunas Convention Act of 1975 (1995), violation: from $100,000 to $109,000.
(7) 16 U.S.C. 972f(b), Eastern Pacific Tuna Licensing Act of 1984:
(i) Violation/subsections (a)(1)-(3): from $27,500 to $30,000.
(ii) Violation/subsections (a)(4)-(5): from $5,500 to $6,000.
(iii) Subsequent violation/subsections (a)(1)-(3): from $55,000 to $60,000.
(iv) Subsequent violation/subsections (a)(4)-(5): from $5,500 to $6,000.
(v) Violation/subsection (a)(6): from $110,000 to $120,000.
(8) 16 U.S.C. 973f(a), South Pacific Tuna Act of 1988, violation: from $275,000 to $300,000.
(9) 16 U.S.C. 1174(b), Fur Seal Act Amendments of 1983, violation: from $10,000 to $11,000.
(10) 16 U.S.C. 1375(a)(1), Marine Mammal Protection Act of 1972, violation: from $11,000 to $12,000.
(11) 16 U.S.C. 1385(e), Dolphin Protection Consumer Information Act (1990), violation: from $100,000 to $110,000.
(12) 16 U.S.C. 1437(c)(1), National Marine Sanctuaries Act (1992), violation: from $109,000 to $119,000.
(13) 16 U.S.C. 1540(a)(1), Endangered Species Act of 1973:
(i) Knowing violations (1988): from $27,500 to $30,000.
(ii) Otherwise violations (1978): from $550 to $600.
(iii) Other knowing violations (1988): from $13,200 to $14,000.
(14) 16 U.S.C. 1851 Note (Sec. 5)(c)(1), Atlantic Striped Bass Conservation Act (1997), violation: from $110,000 to $114,000.
(15) 16 U.S.C. 1858 (a), Magnuson-Stevens Fishery Conservation and Management Act (1990), violation: from $110,000 to $120,000.
(16) 16 U.S.C. 2437(a)(1), Antarctic Marine Living Resources Convention Act of 1984:
(i) Knowing violation: from $11,000 to $12,000.
(ii) Violation: from $5,500 to $6,000.
(17) 16 U.S.C. 2465(a), Antarctic Protection Act of 1990:
(i) Knowing violation: from $10,000 to $11,000.
(ii) Violation: from $5,000 to $5,500.
(18)16 U.S.C. 3373(a), Lacey Act Amendments of 1981:
(i) Other than marking violation: from $11,000 to $12,000.
(ii) Marking violation: from $275 to $300.
(iii) Sale and purchase violation (1988): from $11,000 to $12,000.
(iv) False labeling violation (1988): from $11,000 to $12,000.
(19) 16 U.S.C. 3606(b), Atlantic Salmon Convention Act of 1982 (1990), violation: from $110,000 to $120,000.
(20) 16 U.S.C. 3637(b), Pacific Salmon Treaty Act of 1985 (1990), violation: from $110,000 to $120,000.
(21) 16 U.S.C. 4016(b)(1)(B) Fish and Seafood Promotion Act of 1986, violation: from $500 (up to $5,000) to $550 (up to $5,500).
(22) 16 U.S.C. 5010(a), North Pacific Anadromous Stocks Act of 1992, violation: from $100,000 to $110,000.
(23) 16 U.S.C. 5103(b)(2), Atlantic Coastal Fisheries Cooperative Management Act (1993), violation: from $100,000 to $110,000.
(24) 16 U.S.C. 5507(a), High Seas Fishing Compliance Act of 1995, violation: from $100,000 to $109,000.
(25) 16 U.S.C. 5606(b), Northwest Atlantic Fisheries Convention Act of 1995, violation: from $100,000 to $109,000.
(26) 22 U.S.C. 1978(e), Fishermen's Protective Act of 1967 (1971):
(i) Violation: from $10,000 to $11,000
(ii) Subsequent violation: from $25,000 to $27,500.
(27) 30 U.S.C. 1462(a), Deep Seabed Hard Mineral Resources Act (1980), violation: from $27,500 to $30,000.
(28) 42 U.S.C. 9152(c)(1), Ocean Thermal Energy Conversion Act of 1980, violation: from $27,500 to $30,000.
The inflation adjustments made by § 6.4 of this part, of the penalties there specified, are effective on November 1, 2000, and said penalties, as thus adjusted by the inflation adjustments made by § 6.4 of this part, shall apply only to violations occurring after November 1, 2000, and before the effective date of any future inflation adjustment thereto made subsequent to November 1, 2000, as provided in § 6.6 of this part.
Federal Energy Regulatory Commission (Commission).
Order adopting revised “Business Practice Standards for OASIS Transactions” (BPS Document).
The Commission is revising the BPS Document adopted by the
This order is effective on December 1, 2000.
Office of the Secretary, Federal Energy Regulatory Commission, 888 First Street, N.E., Washington, D.C. 20426. E-Mail address: “comment.rm@ferc.fed.us”.
In this order, the Commission adopts revisions to the “Business Practice Standards for OASIS Transactions” (BPS) adopted by the Commission on February 25, 2000 in
In Order No. 638, the Commission adopted a set of uniform business practices (
On June 16, 2000, the MIC/How Groups jointly submitted for Commission consideration recommendations to revise the BPS. The MIC/How Groups proposed a number of revisions, including revised definitions of the scheduling period for same-day and next-hour transactions in BPS Section 2.6.1, and a new section 7 with 16 new business practices covering NHM Service.
Our August 1, 2000 order invited comments on whether the Commission should adopt the recommended revisions to the BPS suggested by the MIC/How Group, as modified by the Commission.
WEM&T comments on three issues. First, WEM&T comments that the August 1, 2000 order appears to inadvertently retain the original definition of “same-day,” although the Commission was proposing to adopt a revised definition. Specifically, WEM&T notes that the definition in the Attachment to the August 1, 2000 order states:
The Commission agrees that the definition in the Attachment to the August 1, 2000 order does not match the intent of that order. This was an inadvertent error. Accordingly, we revise Standard 2.6.1, as described above.
Next, WEM&T requests that the Commission include a definition of NHM Service in the BPS. WEM&T contends that allowing individual transmission providers to devise their own definitions of NHM Service is not conducive to the creation of seamless interactions between regional transmission organizations.
We deny WEM&T's request. It is predicated on the assumption that individual transmission providers are free to devise their own definitions of NHM Service. This assumption is not accurate. On July 7, 2000, the Commission clarified that “transmission providers wishing to adopt the NHM Service must do so by filing a tariff sheet that states the utility is adopting NERC's NHM Service, as accepted by the Commission in the December 16 order.”
Finally, WEM&T urges the Commission to require transmission providers to offer NHM Service. WEM&T states that mandatory NHM Service will enhance the development of more liquid and competitive electric markets.
The Commission denies this request as beyond the scope of this proceeding which involves business practices, not modifications to the terms of the Commission's pro forma tariff.
(A) The revisions to the “Business Practice Standards for OASIS Transactions” contemplated by the August 1, 2000 order in Docket No. RM95-9-013 are adopted, with the exception of the change in Ordering Paragraph (B) below.
(B) Standard 2.6.1 is revised to read as follows:
By the Commission.
This document contains business practice standards designed to implement the Commission's policy related to on-line price negotiation and to improve the commercial operation of the Open Access Same-Time Information System (OASIS).
This document adopts OASIS business practice standards as mandatory requirements.
The data templates of the Phase IA Standards & Communication Protocols (S&CP) Document have been developed with the use of standard service attributes in mind. What the Phase IA S&CP Document does not offer are specific definitions for each attribute value. This section offers standards for these service attribute definitions to be used in conjunction with the Phase IA data templates.
Fixed services are associated with transmission services whose periods align with calendar periods such as a day, week, or month. Sliding services are fixed in duration, such as a week or month, but the start and stop time may slide. For example a Sliding week could start on Tuesday and end on the following Monday. Extended allows for services in which the start time may slide and also the duration may be longer than a standard length. For example an Extended week of service could be nine consecutive days. Various transmission service offerings using these terms are defined in Standards 2.1.1 through 2.1.14 below. Next_Increment indicates the next available full Service_Increment, such as the next hour, next day, or next week. Next_Increment is added at this time to address Next Hour Market Service, but may be used in the future to denote other products.
Table 1-1 identifies the standard terminology in OASIS Phase IA for the attributes SERVICE_INCREMENT (Hourly, Daily, Weekly, Monthly, and Yearly) and TS_WINDOW (Fixed, Sliding, Extended, and Next_Increment). Values shown in Table 1-1 as N/A (Not Applicable) are not sufficiently common in the market to require standards.
Next Hour Market Service, a new pro forma service, is denoted as having a Service Increment of Hourly and a TS_WINDOW of Next_Increment.
The existence of an attribute value in this table does not imply the services must be offered by a Transmission Provider. Requirements as to which services must be offered are defined by regulation and tariffs. Likewise, absence of a service period value in Table 1-1 does not restrict a Transmission Provider from offering a service. The intent of the table is to establish common terminology associated with standard products.
Each service period value assumes a single time zone specified by the Transmission Provider. It is recognized that daylight time switches must be accommodated in practice, but they have been omitted here for the purpose of simplicity.
The Commission has defined six ancillary services in Order No. 888. Other services may be offered pursuant to filed tariffs.
Other services may be offered to Transmission Customers through Commission-approved revisions to their individual open access tariffs. Examples of other services that may be offered include the Interconnected Operations Services described below in Standards 2.5.7, 2.5.8, and 2.5.9. Ancillary service definitions may be offered pursuant to an individual transmission provider's specific tariff filings.
Operation of OASIS requires unambiguous identification of parties.
The registration requirement applies to any entity logging onto OASIS for the purpose of using or updating information, including Transmission Providers, Transmission Customers, Observers, Control Areas, Security Coordinators, and Independent System Operators.
Section 2 of the OASIS business practice standards addresses the use of standard terminology in defining services on OASIS. These standard definitions for service attribute values will be posted publicly on the OASIS Home Page at http://www.tsin.com and may be used by all Transmission Providers to offer transmission and ancillary services on OASIS. If the Transmission Provider determines that the standard definitions are not applicable, the Transmission Provider may register new attribute values and definitions on the OASIS Home Page. Any Transmission Provider may use the attribute values and definitions posted by another Transmission Provider.
In order to improve coordination of path naming and to enhance the identification of commercially available connection points between Transmission Providers and regions, the business practice for Phase IA OASIS requires that:
A Transmission Provider is not required to register specific generating stations as Points of Receipt, unless they were available as service points for the purposes of reserving transmission service on OASIS. The requirement also does not include registration of regional flowgates, unless they are service points for the purposes of reserving transmission on OASIS.
The Phase IA S&CP Document provides a process state diagram to define the Customer and Transmission Provider interactions for negotiating transmission service. This diagram defines allowable steps in the reservation request, negotiation, approval and confirmation.
The following practices are defined in order to enhance consistency of the reservation process across OASIS Phase IA nodes.
Competing bids exist when multiple requests cannot be accommodated due to a lack of available transmission capacity. One general rule is that OASIS requests should be evaluated and granted priority on a first-come-first-served basis established by OASIS QUEUED time. Thus, the first to request service should get it, all else being equal.
Exceptions to this first-come-first-served basis occur when there are competing requests for limited resources and the requests have different priorities established by FERC regulations and filed tariffs. Prior to the introduction of price negotiations, the attribute values that have served as a basis for determining priority include:
Under a negotiation model, price can also be used as an attribute for determining priority. The negotiation process increases the possibility that a Transmission Provider will be evaluating multiple requests that cannot all be accommodated due to limited resources. In this scenario, it is possible that an unconfirmed request with an earlier QUEUED time could be preempted (SUPERSEDED). For this to occur, the subsequent request would be of higher priority or of greater price.
Phase IA OASIS data templates allow the coupling of ancillary service arrangements with the purchase of transmission service for the purpose of simplifying the overall process for Customers. Transmission
The Transmission Customer should make known to the Transmission Provider at the time of the reservation request certain options related to arrangement of ancillary services. The Transmission Customer may indicate:
While these interactions are available in the Phase IA S&CP Document, there is a need to clarify the associated business practices. The standards in
The Data Element Dictionary of the OASIS S&CP Document, Version 1.3, defines a path name in terms of a 50-character alphanumeric string:
This definition leaves it to the Transmission Providers to name the paths from their own perspective. The following standards provide an unambiguous convention for naming paths and will produce more consistent path names.
If the POR and POD are designated as control areas, then the fourth field may be left blank (as per the example in 6.2).
The standards in this section apply to the offering of Next Hour Market (NHM) Service only. The Commission has designated this service as voluntary for a transmission provider to offer. Therefore the standards apply to a transmission provider only if that provider offers NHM Service, in which case the standards become mandatory for that provider.
Food and Drug Administration, HHS.
Final rule.
The Food and Drug Administration (FDA) is amending the animal drug regulations to reflect approval of a new animal drug application (NADA) filed by Elanco Animal Health. The NADA provides for use of approved, single-ingredient narasin and tylosin phosphate Type A medicated articles to make two-way combination Type C medicated feeds used as an aid in the prevention of coccidiosis, for increased rate of weight gain, and improved feed efficiency in broiler chickens.
This rule is effective November 1, 2000.
Charles J. Andres, Center for Veterinary Medicine (HFV-128), Food and Drug Administration, 7500 Standish Pl., Rockville, MD 20855, 301-827-1600.
Elanco Animal Health, A Division of Eli Lilly & Co., Lilly Corporate Center, Indianapolis, IN 46285, filed NADA 141-170 that provides for use of MONTEBAN® (36, 45, 54, 72, or 90 grams per pound (g/lb) narasin activity) and TYLAN® (10 g/lb of tylosin phosphate) Type A medicated articles to make combination Type C medicated broiler chicken feeds. The combination Type C medicated feeds contain 54 to 72 g/ton narasin and 4 to 50 g/ton tylosin phosphate and are used for the prevention of coccidiosis caused by
In accordance with the freedom of information provisions of 21 CFR part 20 and 514.11(e)(2)(ii), a summary of safety and effectiveness data and information submitted to support approval of this application may be seen in the Dockets Management Branch (HFA-305), Food and Drug Administration, 5630 Fishers Lane, rm. 1061, Rockville, MD 20852, between 9 a.m. and 4 p.m., Monday through Friday.
The agency has determined under 21 CFR 25.33(a)(2) that this action is of a type that does not individually or cumulatively have a significant effect on the human environment. Therefore, neither an environmental assessment nor an environmental impact statement is required.
This rule does not meet the definition of “rule” in 5 U.S.C. 804(3)(A) because it is a rule of “particular applicability.” Therefore, it is not subject to the congressional review requirements in 5 U.S.C. 801-808.
Animal drugs, Animal feeds.
21 U.S.C. 360b, 371.
(d) * * *
(1) * * *
(xi)
(A)
(B)
(f) * * *
(2) Tylosin may also be used in combination with:
(i) Hygromycin B as in § 558.274.
(ii) Melengestrol acetate alone or in combination with certain ionophores as in § 558.342.
(iii) Monensin as in § 558.355.
(iv) Narasin as in § 558.363.
(v) Pyrantel tartrate as in § 558.485.
Environmental Protection Agency.
Notice of deletion of the Publicker Industries Inc. Superfund Site from the National Priorities List (NPL).
The Environmental Protection Agency (EPA) announces the deletion of the Publicker Industries Inc. Superfund Site (Site) in Philadelphia, Pennsylvania from the National Priorities List (NPL). The NPL constitutes Appendix B of 40 CFR Part 300 which is the National Oil and Hazardous Substances Pollution Contingency Plan (NCP), which EPA promulgated pursuant to section 105 of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), as amended. EPA and the Commonwealth of Pennsylvania, through the Pennsylvania Department of Environmental Protection, have determined that the remedial action for the Site has been successfully implemented under CERCLA. For this Site, the selected remedy is protective of human health and the environment as long as the property is used only for industrial purposes.
November 1, 2000.
Comprehensive information on this Site is available for viewing at the repository at the following location: U.S. Environmental Protection Agency, Region III, Regional Center for Environmental Information, 1650 Arch Street, Philadelphia, Pennsylvania 19103. Telephone (215) 814-5254.
Kristine Matzko(3HS21), U.S. Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, PA 19103. Telephone 215-814-5719.
The site to be deleted from the NPL is: Publicker Industries Inc. Superfund Site.
EPA published a Notice of Intent to Delete (NOID) the Publicker Industries Inc. Superfund Site from the NPL on July 20, 2000 in the
EPA identifies sites that appear to present a significant risk to public health, welfare, or the environment and it maintains the NPL as the list of these sites. As described in § 300.425(e)(3) of the NCP, sites deleted from the NPL remain eligible for remedial actions in the unlikely event that future conditions at the site warrant such action.
Deletion of a site from the NPL does not affect responsible party liability or impede EPA efforts to recover costs associated with response efforts.
Environmental protection, Air pollution control, Chemicals, Hazardous substances, Hazardous waste, Intergovernmental relations, Penalties, Reporting and recordkeeping requirements, Superfund, Water pollution control, and Water supply.
33 U.S.C. 1321(c)(2); 42 U.S.C. 9601-9657; E.O. 12777, 56 FR 54757, 3 CFR, 1991 Comp., p. 351; E.O. 12580, 52 FR 2923, 3 CFR, 1987 Comp., p. 193.
Federal Communications Commission.
Correcting amendments.
This document contains corrections to the final regulations, which were published in the
Effective on November 1, 2000.
Leslie K. Shapiro, Mass Media Bureau, (202) 418-2180.
This document corrects Section 73.202(b), the Table of FM Allotment under Oregon to remove Weiser, Channel 280C1 and by adding Weiser, Channel 280C1 under Idaho. FR Doc. 00-24069, published on September 20, 2000 (65FR56799), inadvertently added Weiser, Channel 280C1 to Oregon instead of Idaho.
Radio broadcasting.
47 U.S.C. 154, 303, 334 and 336.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Closure of directed fishery for Pacific mackerel.
NMFS announces the closure of the directed fishery for Pacific mackerel in the exclusive economic zone off the Pacific coast October 27, 2000.The Coastal Pelagic Species Fishery Management Plan (FMP) and its implementing regulations require NMFS to set an annual harvest guideline for Pacific mackerel based on a formula in the FMP and to close the fishery when the harvest guideline is reached. The harvest guideline of 20,740 metric tons is projected to be reached before the end of the fishing season on June 30, 2001, which requires closing the directed fishery and setting an incidental harvest limit for Pacific mackerel so that the harvest of other coastal pelagic species will not be further restricted. The intended effect of this action is to ensure conservation of the Pacific mackerel resource.
Effective October 27, 2000.
The data that was used as the basis for this action are available for public inspection at the Office of the Regional Administrator, Rebecca Lent, Southwest Region (Regional Administrator), NMFS, 501 W. Ocean Boulevard, Suite 4200, Long Beach, CA 90802-4213.
James J. Morgan, Southwest Region, NMFS, (562) 980-4036.
On September 11, 2000, NMFS announced a harvest guideline in the
As of October 17, 2000, 17,829 mt of Pacific mackerel has been harvested. The FMP states that incidental catch allowances are applied when a stock is overfished or a harvest guideline is met, but may be employed under other conditions such as to avoid premature filling of a harvest guideline due to the incidental catch. The high harvest rate of Pacific mackerel will lead to reaching the harvest guideline well before the end of the season and at a time when sardine harvests are likely to be high; therefore, the remaining harvest guideline will be set aside to account for incidental harvests of Pacific mackerel when fishing for sardine. This will tend to minimize bycatch of Pacific mackerel while allowing the sardine fishery to be conducted without further restrictions.
The FMP allows the setting of incidental catch allowances from zero to 45 percent of the landed weight as determined by the Pacific Fishery Management Council (Council) and/or the NMFS Regional Administrator. The Council’s Coastal Pelagic Species Management Team and the Coastal Pelagic Species Advisory Subpanel on October 17-18, 2000 recommended closing the directed fishery for Pacific mackerel and imposing an incidental harvest limit of no more than 20 percent by weight of Pacific mackerel in landings of Pacific sardine. These incidental catch allowances will avoid unnecessary discard; ensure that optimum yield is taken, but not exceeded; and promote efficiency and profitability in the fishery.
For the reasons stated here and in accordance with the FMP and its implementing regulations at 50 CFR 660.509, the directed fishery for Pacific mackerel will be closed October 27, 2000, after which time no more than 20 percent by weight of any landing of Pacific sardine may be Pacific mackerel.
This action is required by 50 CFR 660.509 and is exempt from review under Executive Order 12866.
16 U.S.C. 1801
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Reallocation.
NMFS is reallocating the projected unused amount of Bering Sea and Aleutian Islands management area (BSAI) Pacific cod from trawl catcher/processors and vessels using jig gear to vessels using hook-and-line or pot gear.
Effective October 27, 2000.
Andrew N. Smoker, 907-586-7228.
NMFS manages the groundfish fishery in the BSAI according to the Fishery Management Plan for the Groundfish Fishery of the Bering Sea and Aleutian Islands Area (FMP) prepared by the North Pacific Fishery Management Council under authority of the Magnuson-Stevens Fishery Conservation and Management Act. Regulations governing fishing by U.S. vessels in accordance with the FMP appear at subpart H of 50 CFR part 600 and 50 CFR part 679.
In accordance with § 679.20(c)(5), the Pacific cod TAC for the BSAI was established as 193,000 metric tons (mt) by the Final 2000 Harvest Specifications for Groundfish for the BSAI (65 FR 8282, February 18, 2000). Of this amount, 3,571 mt was allocated to vessels using jig gear, 41,953 mt to trawl catcher vessels, 41,953 mt to trawl catcher/processors, and 91,048 mt to vessels using hook-and-line or pot gear.
On October 2, 2000, NMFS published a request for public comment on a proposed reallocation of 9,000 mt of BSAI Pacific cod from trawl catcher/processors to vessels using hook-and line or pot gear (65 FR 58727). One written comment was received in support of the reallocation. From the years 1997 through 1999 after September 1, the trawl catcher vessel sector of the fishery took about 200 mt or less per year in the Pacific cod target and averaged about 800 mt of catch of Pacific cod in all targets. Current inseason data support a projection of 800 mt for the catcher vessel sector. At this time, no evidence exists that the trawl catcher vessel effort in the Pacific cod fishery will increase beyond what has occurred on the average during the last 3 years.
Accordingly, the Administrator, Alaska Region, NMFS (Regional Administrator), has determined that trawl catcher/processors will not be able to harvest 9,000 mt of Pacific cod allocated to those vessels under § 679.20(a)(7)(i)(A).
Therefore, in accordance with § 679.20(a)(7)(ii)(C), NMFS apportions 9,000 mt of Pacific cod from trawl catcher/processors to vessels using hook-and-line or pot gear.
The Regional Administrator also has determined that vessels using jig gear will not harvest 3,000 mt of Pacific cod by the end of the year. Therefore, in accordance with § 679.20(a)(7)(ii)(C), NMFS is reallocating the unused amount of 3,000 mt of Pacific cod allocated to vessels using jig gear to vessels using hook-and-line or pot gear.
In accordance with § 679.20(a)(7)(ii)(C)(2), the combined reallocation of unused Pacific cod from jig gear and trawl catcher/processors, 12,000 mt is apportioned so that catcher/processor vessels using hook-and-line gear will receive 95 percent and vessels using pot gear will receive 5 percent of the reallocation. The harvest specifications for Pacific cod established in the Final 2000 Harvest Specifications for Groundfish for the BSAI (65 FR 8282, February 18, 2000) and adjusted for hook-and-line or pot gear under Amendment 64 to the FMP (65 FR 51553, August 24, 2000) are revised as follows: 571 mt to vessels using jig gear, 41,953 mt to trawl catcher vessels, 32,953 mt to trawl catcher/processors, 81,958 mt to vessels using hook-and-line gear, and 17,170 mt to pot gear.
This action is taken under 50 CFR 679.20 and is exempt from Office of Management and Budget review under Executive Order 12866.
The Assistant Administrator for Fisheries, NOAA, has determined, under 5 USC 553(b)(3)(B) and 50 CFR 679.20(b)(3)(iii)(A), that good cause exists for waiving the opportunity for public comment as such procedures would be unnecessary and contrary to the public interest. Fisheries are currently taking place that will be supplemented by this apportionment. Delaying the implementation of this action would be disruptive and costly to these ongoing operations. Similarly, pursuant to 5 USC 553(d)(3), good cause exists to waive the 30-day delay in effectiveness of this action.
16 U.S.C. 1801
Postal Service.
Proposed rule.
The Postal Service proposes to revise USPS STD 7A, which governs the design of curbside mailboxes. The proposed revision was developed through a consensus process and was approved by a committee of representatives from mailbox manufacturers, mailbox accessory manufacturers, and the Postal Service.
The Postal Service must receive written comments on or before December 1, 2000.
Written comments should be mailed to Civil Practice Section, Law Department, U.S. Postal Service, 475 L'Enfant Plaza SW., Room 6235, Washington DC 20260-1127. Copies of all written comments will be available for public inspection and copying between 9:00 a.m. and 4:00 p.m., Monday through Friday, at the address above.
Annamarie Gildea, (202) 268-3558.
U.S. Postal Service Standard, Mailboxes, City and Rural Curbside, USPS STD 7A, governs the design of curbside mailboxes. The current standard, adopted in 1992, prescribes design limitations in terms that are no longer consistent with the operational requirements of the Postal Service.
The Postal Service used a consensus process in developing the proposed revised standard. In a consensus process, representatives of interests that would be substantially affected by a new rule meet as an advisory committee and negotiate among themselves and with the agency to reach a consensus on a proposed new rule. As part of the consensus process, the agency agrees to use a recommendation by the committee as the basis of the proposed rule. In addition, each private member of the Committee agrees that, if it agrees to a recommendation by the Committee, it will support that recommendation and the proposed rule to the extent that it reflects the recommendation.
In this instance, the Postal Service retained the services of an independent, neutral third party to convene a Consensus Committee and facilitate discussions of Committee members. Based on the Convenors' recommendation, the Postal Service invited Consensus Committee members representing interests that were expected to be substantially affected by the new rule. Further, Committee members were responsible for representing other interested individuals and organizations that were not present at committee meetings and keeping them informed of the Committee's proceedings.
As part of the ground rules agreed to by all members of the Consensus Committee, the Postal Service agreed to use a recommendation by the Committee as the basis of the proposed rule. In addition, each private member of the Committee agreed that, if it agreed to a recommendation by the Committee, it would support that recommendation and the proposed rule to the extent that it reflects the recommendation. After the Consensus Committee held several meetings that were open to the public, the Committee approved and recommended the standard set forth below.
Changes incorporated in the proposed new standard, which shall be titled USPS STD 7B include the following:
1. Eliminated the requirement that Traditional mailboxes must be built in conformance with USPS drawings (formerly designated T1, T2, and T3). All three USPS drawings were eliminated and replaced with a new figure which gives manufacturers more design flexibility.
2. Removed all requirements to comply with military and federal specifications and standards.
3. Deleted flammability, solar exposure, and color intensity test requirements that were determined to be invalid or unnecessary.
4. Dropped requirement that manufacturers comply with the National Motor Freight Classification Rule 222.
5. Introduced a new Locked mailbox classification with two new figures. This design will provide customers with an option to purchase mailboxes that offer increased security for their mail.
6. Incorporated quality assurance provisions.
7. Added a figure depicting three new alternative flag designs.
8. Included new guidelines and a figure for acceptable door handle and knob designs.
9. Clarified application requirements and introduced independent laboratory testing.
The re-approval process for manufacturers with mailbox designs that were approved before the final publication date of USPS STD 7B will be conducted as follows. The approval process for all other mailbox designs will be conducted in accordance with USPS STD 7B, part 5.
1. The USPS will notify currently approved manufacturers within five business days after final publication of USPS STD 7B in the
2. Manufacturers will have 90 days after receipt of this notification to submit a sample of each of their previously approved mailboxes. In addition, manufacturers shall submit their quality assurance manual, and each mailbox must be accompanied with a compliance certificate, one set of drawings, product information, and instructions. Mailboxes will be tested on a first-come, first-served basis.
3. If a previously approved mailbox is not submitted within the 90-day period, it will automatically lose its approval status. A manufacturer may receive an extension of up to 45 days, provided reasonable justification is demonstrated to the USPS. Manufacturers seeking an extension must write to: Attn Delivery & Retail Systems, USPS Information Platform, 8403 Lee Hwy, Merrifield, VA 22082-8101.
4. The USPS will have up to 90 days to respond to submissions, during which time manufacturers can continue to sell their mailboxes.
5. If a submitted mailbox does not pass the revised standard's requirements, the manufacturer may make modifications and re-submit their
6. If a mailbox fails two testing attempts, manufacturers may still make modifications and re-submit in accordance with the new application requirements specified in the revised standard. However, the conditions identified in #5 above remain in effect.
Postal Service.
1. The authority citation for 39 CFR part 111 continues to read as follows:
5 U.S.C. § 552(a), 39 U.S.C. §§ 101, 401, 403, 404, 3001-3011, 3201-3219, 3403-3406, 3621, 3626, 5001.
2. Revise USPS STD 7A as set forth below:
This standard covers all curbside mailboxes. Curbside mailboxes are defined as any design made to be served by a carrier from a vehicle on any city, rural, or highway contract route. This standard is not applicable to mailboxes intended for door delivery service (see 6.1).
Based on their size and design, curbside mailboxes are classified as:
Manufacturers whose mailboxes have been approved by the United States Postal Service (USPS) will be listed in the Postal Operations Manual (POM) and published in the Postal Bulletin.
Manufacturing standards and current information concerning the manufacture of curbside mailboxes may be obtained by writing to: USPS Information Platform, Delivery and Retail Operation Equipment, 8403 Lee Hwy, Merrifield, VA 22082-8101.
Except where specifically noted, the specifications set forth herein shall apply to all curbside mailbox designs.
The following documents of the latest issue are incorporated by reference as part of this standard.
Copies of the Domestic Mail Manual can be obtained from the Government Printing Office, Mail Stop SSOM, 732 N Capitol Street NW., Washington DC 20402-9375. It is available on the Internet also at http://pe.usps.gov.
Copies of the Postal Operations Manual can be obtained from the USPS Material Distribution Center, 500 SW. Montara Pkwy, Topeka KS 66624-9702.
The following documents of the latest issue are incorporated by reference as part of this standard.
Copies of these documents can be obtained from the American Society for Testing and Materials, 1916 Race Street, Philadelphia PA 19103-1108.
Copies of this document can be obtained from Underwriters Laboratories Inc., 333 Pfingsten Road, Northbrook IL 60062-2096.
Copies of these documents can be obtained from the American Society for Quality, PO Box 3066, Milwaukee WI 53201-3066.
Mailbox manufacturers must ensure and be able to substantiate that units manufactured conform to the requirements of this specification.
The Postal Service reserves the right to inspect units for conformance to this specification at any stage of manufacture. Inspection by the Postal Service does not relieve the manufacturer of the responsibility to provide performance that conforms to the requirements set forth in this specification. Prior to any visits, the Postal Service will provide a minimum notice of 30 business days. The Postal Service will suspend the approval status of any manufacturer's model which is found to be out of conformance with approved drawings (see 5.2.2).
The manufacturer shall use a documented quality system acceptable to the Postal Service. As a minimum, the manufacturer's quality system shall include controls and record keeping in the following areas (a quality system in compliance with ANSI/ASQC Q9002-1994 meets this requirement):
The Postal Service has the right to evaluate the acceptability and effectiveness of the manufacturer's quality system before approval and during tenure as an approved source.
All of the manufacturer's records pertaining to the approved product shall be kept for a minimum of three years after shipment of product.
Mailboxes must meet regulations and requirements as stipulated in paragraph 2.2. This includes carrier door operation as stated in 3.4, flag operation as stated in 3.7, incoming mail openings, and the retrieval of outgoing mail. The opening style, design, and size are determined by the manufacturer; however, the carrier must be able to deposit the customer's mail through the slot or open door with a single motion of the carrier's arm. Outgoing mail of all designs must be able to be pulled straight out of the mailbox without interference from protrusions, hardware, etc. Mailboxes must be capable of passing the applicable testing requirements in 3.15. Mailboxes must not be made of any
Mailbox designs that conform to Figure 1 and meet capacity requirements specified in 3.15.1 will be classified as Traditional. Designs incorporating a carrier signal flag (see 3.7) will be classified as full service mailboxes. Designs with no flag will be classified as limited service (see 3.12.2). As specified in 3.5, a rear door is permitted to enable the customer to remove mail without standing in the street. The use of locks, locking devices, or inserts is prohibited.
Mailbox designs that do not conform to the dome-rectangular shape of Traditional designs but meet capacity requirements specified in 3.15.1 will be classified as Contemporary. Designs incorporating a carrier signal flag (see 3.7) will be classified as full service mailboxes. Designs with no flag will be classified as limited service (see 3.12). Although the shape and design is less restrictive, Contemporary mailboxes must meet the same applicable functional requirements. Contemporary designs can also incorporate a rear door, as specified in 3.5, to enable the customer to remove mail without standing in the street. The use of locks, locking devices, or inserts is prohibited.
Mailbox designs that provide security for customer's incoming mail will be classified as Locked mailboxes (see Figures 2 and 3). Although the shape and design is less restrictive, Locked mailboxes must meet the same applicable functional requirements. Designs having a slot for incoming mail must be at least 1.75 inches high by 10 inches wide. If a slot has a protective flap it must operate inward to ensure mail can be inserted in horizontal manner without requiring any additional effort of carriers (see Figure 3). The slot must be positioned on the front side of the mailbox facing the street. In addition, the slot must be clearly visible and directly accessible by mail carriers. Any designs that allow for outgoing mail must meet all applicable requirements of this standard.
Locked mailbox designs of this class allow for both incoming and outgoing mail as depicted in Figure 2. It is preferred that both incoming and outgoing mail compartments be located behind a single carrier service door as shown in Figure 2 (the term “preferred” in this document means that compliance is desired but not mandatory). Alternate positioning of the incoming mail compartment, such as beneath or side-by-side with the outgoing compartment, is permitted provided that no additional carrier service is introduced.
Locked mailbox designs of this class allow only for incoming mail as shown in Figure 3.
Decorative art and devices can be attached to the exterior of approved mailbox designs provided they do not interfere with mail delivery or present a safety hazard. Devices can also be mounted in the interior of approved mailboxes provided they do not cause the mailbox to fail the capacity test described in 3.15.1 and do not interfere with mail delivery or present a safety hazard. Any and all advertising on a mailbox or its support is prohibited. Unrestricted spring-loaded devices and designs are prohibited. Auxiliary flags or devices used to signal the customer that the mail has arrived must operate automatically without requiring additional carrier effort.
Ferrous or nonferrous metal, wood (restrictions apply), plastic, or other materials may be used, as long as their thickness, form, mechanical properties, and chemical properties adequately meet the operational, structural, and performance requirements set forth in this standard. Materials used must not be toxic, flammable, or transparent.
The entire bottom area of all mailboxes where mail would rest shall be fabricated to prevent mail from damage due to condensation or moisture. Except for the internal mail compartment of locked-style mailboxes, all designs must not present a lip or protrusion that would prevent the mail from being inserted or pulled straight out of the mailbox. The surface of the floor cannot be made of wood material. The floor shall be ribbed as shown in Figures 1, 2, and 3 or dimpled, embossed, or otherwise fabricated provided the resulting surface area (touching mail) does not exceed .25 square inch (per dimple/impression) and is minimum of .12 inch high on centers not exceeding 1 inch. A mat insert having a raised surface contour may be used for the internal mail compartment of locked-style mailboxes only (see Figures 2 and 3).
Cannot be made of wood. Plastic is the preferred material.
Cannot be made of wood. Plastic is the preferred material.
There shall be only one carrier service door, which must provide access for mail delivery and collection intended by the unit and meet USPS delivery operational requirements (see 2.2). The door must meet the applicable testing requirements specified in 3.15.2. The carrier service door must operate freely and solely by pulling outward and downward with a convenient handle or knob. The design of the door, including hinges and handles, must provide protection against wind, rain, sleet, or snow (see 3.15.3). Door latches must hold the door closed but allow easy opening and closing requiring no more than 5 pounds of force. Action of the latch must be a positive mechanical one not relying solely on friction of the hinge parts. The door shall not be spring-loaded. Magnetic latches are acceptable provided adequate closure power is maintained during ambient conditions specified in 3.15.6 and applicable testing described in 3.15. It is preferred that by either tactile or by sound (
The handle or knob shall have adequate accessibility to permit quickly grasping and pulling it with one hand (with or without gloves) to open the door. The handle or knob shall be located within the top third of the door. Various acceptable handle and knob designs with required dimensions are depicted in Figure 5. Other designs may be acceptable, provided they allow enough finger clearance and surface area for carriers to grasp.
Mailboxes may have a rear door, provided that it does not interfere with the normal delivery and collection operation provided by the carrier or require the carrier to perform any unusual operations. The rear door must not be susceptible to being forced open as a result of large mail items such as newspapers and parcels being inserted through the carrier door. The rear door must meet the applicable testing requirements specified in 3.15.
Locked mailbox designs shall have an effective means to ensure that incoming mail is accessible only by the customer. The use of locks on Contemporary and Traditional mailbox designs is prohibited. Manufacturers must include the following statement in their instructions to customers: “IT IS IMPORTANT TO NOTE THAT IT IS NOT THE RESPONSIBILITY OF MAIL CARRIERS TO OPEN MAILBOXES THAT ARE LOCKED, ACCEPT KEYS FOR THIS PURPOSE, OR LOCK MAILBOXES AFTER DELIVERY OF THE MAIL.”
Traditional, Contemporary, and Locked mailbox designs classified as Full Service shall have a carrier signal flag. The flag design must be one of the approved concepts depicted in Figures 1, 2, and 4. As shown in each figure, the flag must be mounted on the right side when facing the mailbox from the front. The flag must not require a lift or more than 2 pounds of force to retract. Additionally, when actuated (signaling outgoing mail) the flag must remain in position until retracted by the carrier. The color of the flag must be in accordance with requirements described in 3.10. The operating mechanism of the flag must not require lubrication and must continue to operate properly and positively (without binding or excessive free play) after being subjected to testing described in 3.15. Optionally, the flag may incorporate a self-lowering feature that causes it to automatically retract when the carrier service door is opened, provided no additional effort is required of the carrier. The self-lowering feature cannot present protrusions or attachments and must not interfere with delivery operations in any manner or present hazardous features as specified in 3.2.
The mailbox must bear two inscriptions on the carrier service door: “U.S. MAIL” in a minimum of .50-inch-high letters and “Approved By The Postmaster General” in a minimum of .18-inch-high letters. These inscriptions may be positioned beneath the incoming mail slot for Limited Service Locked mailboxes as shown in Figure 3. Markings must be permanent and may be accomplished by applying a decal, embossing on sheet metal, raised lettering on plastic, engraving on wood, or other methods that are suitable for that particular unit. The manufacturer's name, address, date of manufacture (month and year), and model number or nomenclature must be legible and permanently marked or affixed on a panel (rear, backside of door, bottom, or side interior near the carrier service door) of the mailbox that is readily accessible and not obscured.
Mailboxes that use previously approved units in their design must include marking stating the new manufacturer's name, address, date of manufacture, and model nomenclature in a permanent fashion and location as described above. Additionally, the “U.S. MAIL” and “Approved By The Postmaster General” marking shall be reapplied if it is obscured or obliterated by the new design.
Choice of coatings and finishes is optional, provided all requirements of this standard are met. All coatings and finishes must be free from flaking, peeling, cracking, crazing, blushing, and powdery surfaces. Coatings and finishes must be compatible with the mailbox materials. Accept for small decorative accents, mirrorlike coatings or finishes are prohibited. The coating or finish must meet the applicable testing requirements described in 3.15.5.
The color of the mailbox and flag must be in accordance with the following requirements. The mailbox may be any color. The carrier signal flag can be any color except any shade of green, brown, white, yellow, or blue. The preferred flag color is fluorescent orange. Also, the flag color must present a clear contrast with the predominant color of the mailbox.
The mailbox shall be provided with a means for convenient and locked mounting that meets all applicable requirements of the Postal Operations Manual. The manufacturer may offer various types of mounting accessories such as a bracket, post, or stand. Although the USPS does not regulate the design of mounting accessories, it is pointed out that no part may project beyond the front of the mounted mailbox. Mounting accessories must not interfere with delivery operations as described in 3.2 or present hazardous features as described in 3.14. See section 6 for additional important information.
A complete set of instructions for assembling and mounting the mailbox shall be furnished with each unit. The instructions must include the following conspicuous message: “CUSTOMERS ARE REQUIRED TO CONTACT THE LOCAL POST OFFICE BEFORE INSTALLING THE MAILBOX TO ENSURE ITS CORRECT PLACEMENT AND HEIGHT AT THE STREET. GENERALLY, MAILBOXES ARE INSTALLED AT A HEIGHT OF 41-45 INCHES FROM THE ROAD SURFACE TO INSIDE FLOOR OF THE MAILBOX OR POINT OF MAIL ENTRY (LOCKED DESIGNS) AND ARE SET BACK 6-8 INCHES FROM FRONT FACE OF CURB OR ROAD EDGE TO THE MAILBOX DOOR.”
The following conspicuous note shall be included with each mailbox:
A receptacle for the delivery of newspapers may be attached to the post of a curbside mailbox, provided no part of the receptacle interferes with the delivery of mail, obstructs the view of the flag, or presents a hazard to the carrier or the carrier's vehicle. The receptacle must not extend beyond the front of the box when the door is closed.
The mailbox shall be properly assembled and utilize the best commercial practice workmanship standards in the fabrication of all components and assemblies. All movable parts shall fit and operate properly with no unintended catch or binding points. The unit must be free from harmful projections or other hazardous devices. The unit must not have any sharp edges, sharp corners, burrs, or other features (on any surfaces) that may be hazardous to carriers/customers, or that may interfere with delivery operations as described in 3.2.
Mailboxes will be subjected to all applicable testing described herein (specific requirements follow). A mailbox that fails to pass any test will be rejected. Testing will be conducted in sequence as listed herein and in Table III.
Traditional and Contemporary designs must meet minimum capacity requirements tested by insertion and removal of a standard test gauge which measures 18.50″ long x 5.00″ wide x 6.00″ high. The test gauge is inserted with its 6.00″ dimension aligned in the vertical axis (perpendicular to the mailbox floor). The gauge must be capable of easy insertion and removal and, while inserted, allow for the door(s) to be completely closed without interference. The capacity of Locked designs, which have slots, chutes, or similar features, will be tested and approved based upon whether standard USPS mail sizes (see Table I) can be easily inserted through the mail slot or opening. Retrieval of this mail from the locked compartment shall be equally as easy.
Carrier service doors, auxiliary doors, door catches/mechanisms, carrier signal flags, and applicable accessory devices must be capable of operating 7,500 normal operating cycles (one cycle=open/close) at room temperature, continuously and correctly, without any failures such as breakage of parts. Testing may be performed either manually or by means of an automated, mechanically driven test fixture which essentially mimics a manual operation. This test is applicable to all mailbox designs.
A rain test in accordance with UL 771, section 47.7, shall be performed to determine a mailbox's ability to protect mail from water. The rain test shall be operated for a period of 15 minutes for each side. At the conclusion of the test, the outside of the unit is wiped dry and all doors are opened. The inside of the compartment must contain no water other than that produced by high moisture condensation. This test is applicable to all mailbox designs.
A salt spray test shall be conducted in accordance with method A5 of ASTM G85, Standard Practice for Modified Salt Spray (Fog) Testing. The salt test shall be operated for 25 continuous cycles with each cycle consisting of one hour of fog and one hour of dry-off. The mailbox shall be tested in a finished condition, including all protective coating, paint, and mounting hardware, and shall be thoroughly washed when submitted to remove all oil, grease, and other nonpermanent coatings. No part of the mailbox may show finish corrosion, blistering, or peeling or other destructive reaction upon conclusion of test. Corrosion is defined as any form of property change such as rust, oxidation, color changes, perforation, accelerated erosion, or disintegration. The buildup of salt deposits on the surface shall not be cause for rejection. However, any corrosion, paint blistering, or paint peeling is cause for rejection. This test is primarily applicable to ferrous metal mailbox designs. It is also valid for mailboxes designs made of plastic, wood, or other materials which use any metal hardware.
The mailbox's coating/finish shall be tested for resistance to abrasion in accordance with method A of ASTM D968. The rate of sand flow shall be 2 liters of sand in 22 seconds, plus or minus 3 seconds. The mailbox will have failed the sand abrasion test if less than 15 liters of sand penetrates its coating or if less than 75 liters of sand penetrates its plating. This test is applicable to metal mailbox designs only.
The mailbox under test shall be placed in a cold chamber at −65° Fahrenheit for 24 hours. The chamber shall first be stabilized at the test temperature. After remaining in the −65° environment for the 24-hour period, the unit shall be quickly removed from the cold chamber into room ambient and tested for normal operation. The removal from the chamber and the testing for normal operation shall be accomplished in less than three minutes. The room ambient shall be between 65° and 75° Fahrenheit. Normal operation is defined as operation required and defined by this document. The unit under test shall undergo a similar temperature test, as described above, at a temperature of 140° Fahrenheit. This test is applicable to all mailbox designs.
Forces of specified magnitude (see Table II) shall be slowly applied at specific points on the mailbox under test (see Figure 6). These forces shall be held for a minimum of one minute and then released. After their release, the deformation caused by the forces shall be measured. If the deformation exceeds the limit specified in Table II, the mailbox under test has failed to meet the structural rigidity requirement. The doors shall remain closed for test positions one through six. The application of the forces at positions one and two shall be applied with the mailbox in its normal upright position, supported by a horizontal board. The application of the forces at positions three, four, and five shall be applied with the mailbox lying on its side (flag side down). The mailbox shall be supported, on the underside, by a flat board that is relieved in the immediate area of the flag mechanism. The application of force at position six (Traditional style flags only) shall be applied with the mailbox lying on its side (flag side up). The application of force at position six shall be repeated at the top of the flag with the mailbox in its normal upright position. If visible cracks in the material have developed as a result of the testing, the mailbox under test has failed to meet the structural rigidity requirement. At the conclusion of the structural rigidity testing, if the mailbox under test fails to operate normally, as defined by this document, the mailbox under test has failed to meet the structural rigidity requirement. This test is applicable to all mailbox designs.
Refer to Figure 6 for load positions. Precondition the mailbox for four hours at −20° Fahrenheit. The following testing shall be performed within three minutes of removing the mailbox from the temperature chamber. At both load positions three and four, with the mailbox lying on its side (flag side down) with the door(s) closed, apply an impact load equivalent to a 10-pound weight dropped from a height of 3 feet above the mailbox surface onto a bolster plate having a surface not larger than 2 inches by 2 inches. The mailbox shall be supported, on the underside, by a flat board that is relieved in the immediate area of the flag mechanism. If any noticeable perforation, occurrence of sharp edges, or cracking of the material, either inside or outside the mailbox, develops as a result of the impact, or if the door becomes inoperable or fails to close normally, the mailbox under test has failed to meet the impact resistance requirement. This test is applicable to all mailbox designs.
Requests for application materials, and all other correspondence and inquiries, shall be directed to the address in 1.3.2. The application process is described below.
Manufacturers must first satisfy requirements of a preliminary review prior to submitting any sample mailboxes or accessories. The preliminary review consists of a review of the manufacturer's conceptual design drawings. Computer-generated drawings are preferred, but hand-drawn sketches are acceptable provided they clearly depict the overall shape and interior size of the proposed mailbox design. Drawings must also include details on design of applicable features such as the carrier service door, latch, handle, flag, floor, and slot. In addition to drawings, proposed accessories shall show or describe intended function. If drawings show that the proposed mailbox design appears to comply with the requirements of this standard, manufacturers will be notified in writing and may then continue with the application requirements described in 4.1.2. Do not submit any sample mailboxes to the USPS prior to complying with the requirements of 4.1.2. Notification that a manufacturer's drawings satisfy the requirements of the preliminary review does not constitute USPS approval of a design and shall not be relied upon as an assurance that a design will be approved.
Upon receiving written notification from the USPS that their design satisfies requirements of the preliminary review, manufacturers shall at their own expense submit one sample of their mailbox or accessory to an independent laboratory for testing along with a copy of the preliminary review letter from the USPS. See Appendix A for a list of USPS-approved independent test labs. Manufacturers with more than one unique model shall have each one tested independently. Models which are generally of the same size, shape, and material of previously approved designs but have only different decorative features (
Manufacturers shall submit one sample mailbox or accessory to the USPS for final review and approval. The sample shall be accompanied by a certificate of compliance and a copy of the laboratory test results (see 4.1.3.3). Mailboxes submitted to the USPS (see 1.3.2) for final evaluation must be identical in every way with the mailboxes to be marketed and must be marked as specified in 3.8. Manufacturers may be subject to a verification of their quality system prior to approval. This may consist of a review of the manufacturer's quality manual (see 4.1.3.4) and an on-site quality system evaluation (see 3.1).
Submit a copy of the instructions conforming to 3.12 including the statement concerning locks in 3.6.
The unit submitted for approval shall be accompanied by one complete set of manufacturing drawings consisting of black-on-white prints (blueprints or sepia are unacceptable). The drawings shall be dated and signed by a manufacturer's representative(s). The drawings must completely document and represent the design of the unit tested. The drawings must include sufficient details to allow the USPS to inspect all materials, construction methods, processes, coatings, treatments, finishes (including paint types and colors), control specifications, parts, and assemblies used in the construction of the unit. Additionally, the drawings must fully describe any purchased materials, components, and hardware, including their respective finishes. The USPS may request individual piece parts to verify drawings.
Manufacturers shall furnish a written certificate of compliance indicating that their design fully complies with the requirements of this specification. In addition, the manufacturer shall submit the lab's original report which clearly shows results of each test conducted (see Table III). The manufacturer bears all responsibility for their unit(s) meeting these requirements and the USPS reserves the right to retest any and all units submitted, including those which are available to the general public.
The manufacturer shall submit its quality policy manual. The manual should be structured in accordance with ISO 10013 and with the requirements of ISO 9002.
Written notification, including reasons for disapproval, will be sent to the manufacturer within 30 days of completion of the final review of all submitted units. All correspondence and inquiries shall be directed to the address listed in 1.3.2.
Mailboxes disapproved will be disposed of in 30 calendar days from the date of the written notification of disapproval, or returned to the manufacturer if requested, provided the manufacturer pays shipping costs.
One set of manufacturing drawings with written notification of approval will be returned to the manufacturer. The drawings will be stamped and identified as representing each unit.
Mailboxes that are approved will be retained by the USPS.
Manufacturer's production units shall be constructed in accordance with the identified (stamped) drawings and provisions of this specification and be of the same materials, construction, coating, workmanship, finish, etc. as the approved units. Within 60 days upon sale of their approved mailbox to the public, manufacturers shall submit one production unit to the USPS office listed in 1.3.2. The USPS reserves the right at any time to examine and retest units obtained either in the general marketplace or from the manufacturer. If the USPS determines that a particular mailbox model is not in compliance with this standard, USPS may suspend or rescind approval as follows.
Changes which affect the form, fit, or function (
If any substantive part of the approved manufacturer's structure changes from what existed when the manufacturer became approved, the manufacturer shall notify the USPS and may be subject to a re-evaluation of product or quality system. Examples of substantive structural changes are: change in executive or quality management, major change in quality policy or procedures, relocation of manufacturing facilities, major equipment or manufacturing process change (
Within 60 days upon sale to public, manufacturers shall submit one copy of their product(s) brochure(s) representing approved mailbox design(s) to the address listed in 1.3.2, and to: USPS, Delivery Policy and Programs, 475 L'Enfant Plaza, Rm. 7142, Washington, DC 20260-0004.
6.1 Mailboxes intended to be used in delivery to customer's doors are not currently “approved” by the United States Postal Service as referenced in this standard. However, it is recommended that these boxes conform to the intentions of this specification, particularly the safety of the carrier and customer and the protection of the mail. The local postmaster shall be contacted prior to installation and use of any door mailbox.
6.2 The United States Postal Service does not approve mailbox posts or regulate mounting of mailboxes other than the requirements specified in sections 3.11 and 3.12. Please note that mailbox posts are often subject to local restrictions, state laws, and federal highway regulations. Further information may be obtained from:
(1) ACTS Test Labs, 100 Northpointe Parkway, Buffalo, NY 14228-1884, Contact: Dennis Maclaughlin, Phone: 716-505-3547 Fax: 716-505-3301.
(2) The Coatings Lab, 10175 Harwin Drive, Suite 110, Houston, TX 77036, Contact: Tom Schwerdt, Phone: 713-981-9368 Fax: 713-776-9634.
(3) Ithaca Materials Research and Testing, Inc. (IMR), Lansing Business and Technology Park, 31 Woodsedge Drive, Lansing, NY 14882, Contact: Jeff Zerilli, Vice President, Phone: 607-533-7000.
(4) Independent Test Laboratories, Inc., 1127B Baker Street, Costa Mesa, CA 92626, Contact: Robet Bouvier, Phone: 800-962-Test Fax: 714-641-3836.
(5) Environ Labs L.L.C., 9725 Girard Ave S., Minneapolis, MN 55431, Contact: Chuck Mapes, Phone: 800-826-3710 Fax: 612-888-6345.
(6) Midwest Testing Laboratories, Inc., 1072 Wheaton, Troy, MI 48083, Contact: Cherie Ulatowski, Phone: 248-689-9262 Fax: 248-689-7637.
Additional test laboratories may be added provided they satisfy USPS certification criteria. Interested laboratories should contact: USPS Engineering, Test Evaluation and Quality, 8403 Lee Hwy, Merrifield, VA 22082-8101.
Fish and Wildlife Service, Interior.
Notice of 90-day petition finding.
We, the U.S. Fish and Wildlife Service (Service), announce a 90-day finding on a petition to remove the woodland caribou (
The finding announced in this document was made on October 13, 2000.
Data, information, comments, or questions concerning this petition should be submitted to the Field Supervisor, Upper Columbia River Basin Field Office, U.S. Fish and Wildlife Service, 11103 E. Montgomery Drive, Spokane, Washington 99206. The petition finding, supporting data, and comments are available for public inspection, by appointment, during normal business hours at the above address.
Susan Martin, Supervisor, Upper Columbia River Basin Office, at the above address (telephone 509/891-6839; facsimile 509/891-6748).
Section 4(b)(3)(A) of the Act (16 U.S.C. 1531
On May 27, 1998, we received a petition dated May 22, 1998, to delist the endangered population of woodland caribou (
In a letter dated June 12, 1998, we notified the petitioner that a finding on their petition would be delayed due to a backlog of higher priority listing activities. This backlog resulted from a moratorium on listing activities enacted by Congress in 1995 and a subsequent series of inadequate budgets for listing activities. We now use funding for recovery activities to support work on findings for delisting petitions, and, therefore, we were able to proceed with this finding.
The petitioner made a number of assertions in the petition, but the main points were—(1) our determination to list and maintain the listing of the caribou is based solely on conjecture and inadequate research, and no biological reason or need for the listing has been established by research and conclusion; (2) there is no significant biological distinction between the mountain and woodland caribou, and, since there are numerous “woodland” caribou in Canada, their listing in the United States is not warranted (also, the petitioner contends there is a problem with mixing mountain and woodland caribou within the Selkirk population); (3) the petitioner has several concerns regarding the historical and current range of the woodland caribou and whether or not caribou ever inhabited the conterminous United States, including Idaho; (4) no environmental impact statement was prepared for the listing; (5) caribou mortalities within this population have been high; and (6) old growth forest has not been established as a requirement for caribou habitat.
We have reviewed the petition and other documentation to determine if substantial information has been presented to indicate that the requested action may be warranted. The factors for listing, delisting, or reclassifying species are described at 50 CFR 424.11. We may delist a species only, after conducting a review of the species status, if the best scientific and commercial data available substantiate that it is neither endangered nor threatened. Delisting may be warranted as a result of—(1) extinction, (2) recovery, or (3) a determination that the original data used for classification of the species as endangered or threatened were in error.
Our determination to list the woodland caribou was made on the basis of the best scientific and commercial data available (49 FR 7390; February 29, 1984). The petition's assertion that the listing of the woodland caribou is based solely on conjecture comes from the petitioner's interpretation of our revised Recovery Plan for Woodland Caribou in the Selkirk Mountains (Recovery Plan). The Recovery Plan stated a number of unknowns about caribou biology, population factors, and habitat variables. These statements were made in the context of gathering the information needed to support recovery actions. Though it is true there is much to learn about the caribou, at the time of listing, we had enough information to warrant the listing of the species, including substantial information on habitat fragmentation, poaching, and a genetic bottleneck.
Regarding the issue of “woodland” versus “mountain” caribou, woodland caribou occur in two distinct ecotypes (a locally adapted population of a widespread species): The northern ecotype and the mountain ecotype. In woodland caribou, ecotypic differentiation is based on habitat use and behavior patterns. The endangered Selkirk population is the mountain ecotype. Both ecotypes are within the same subspecies; there is no genetic distinction between caribou inhabiting the northern ecotype and those inhabiting the mountain ecotype (Service 1994).
Historically, woodland caribou were distributed across the northeastern, northcentral, and northwestern conterminous United States (Fashingbauer 1965, cited in Service 1994; McCollough 1991). It is well-documented that the species' range was once more extensive than it is today. Caribou once occurred as far south as the Salmon River in Idaho and as far east as the North Fork of the Flathead River in Montana (Evans 1960). Before 1910, they occupied the Selkirk, Cabinet, Purcell, and Bitterroot Mountains (Evans 1960; Layser 1974). By the 1950's, caribou were reduced to about 100 animals occupying about 2,590 square kilometers (1,000 square miles) in the Selkirk Mountains, with remnant bands in the Cabinet and Yaak Mountains (Flinn 1956; Evans 1960). Although by 1983 the distribution of the
At the time of listing, we did not distinguish the caribou population by State. Caribou movement within home ranges may cross State boundaries, and the listing decision was based on the species' status within the United States. According to section 3(15) of the Act, “species” can include “any distinct population segment of any species of vertebrate fish or wildlife which interbreeds when mature.” We listed the woodland caribou as a distinct vertebrate population segment limited to Idaho, Washington, and that part of southeast British Columbia, Canada, bounded by the United States-Canadian border, Columbia River, Kootenay River, and Kootenay Lake. The Selkirk Mountain population of woodland caribou was listed because its range and distribution within the conterminous United States had undergone a significant decline and the species was being affected by a variety of ongoing threats.
We did not prepare an environmental impact statement at the time of listing the woodland caribou. As stated in the final rule listing the woodland caribou published in the
The petitioners are correct in that the woodland caribou population has experienced significant mortalities due to a number of factors. The population, which consisted of an estimated 25-30 animals when it was listed in 1984, has been augmented with a total of 103 animals over an 11-year period between 1987 and 1998. In 1998, the population consisted of an estimated 44 animals (includes animals recruited into the population through reproduction). Fifty-nine of the transplanted caribou died over this 11-year period, and the fate of 21 others is unknown due to radio-collar loss or failure. However, while this speaks to the difficulty and critical nature of the recovery program, it does not provide a reason to delist the caribou.
Seasonal habitat use patterns and forage requirements by woodland caribou have been documented by research in northern Idaho and British Columbia. Occasionally, caribou have been observed feeding on succulent, newly emerging vegetation in clearcuts in the spring. However, data show that, even during spring, caribou preferentially use old-growth and mature forest habitats as a source of forage (Wakkinen
When evaluating petitions for delisting of species under the Act, our guidelines state that a “not-substantial information” finding be made when a petition to delist a species presents no new information indicating the original data for listing the species may be in error (Service and National Marine Fisheries Service 1996). We have reviewed the petition and other available literature. We conclude the petition does not present substantial information to indicate that the original data for listing the species was in error, or that delisting the Selkirk Mountains woodland caribou may be warranted. Furthermore, the species has not met the recovery objectives identified in the 1994 Recovery Plan, which calls for an increasing population and secure habitat.
The primary author of this document is Suzanne Audet, Fish and Wildlife Service, Upper Columbia River Basin Office (see
The authority for this action is the Endangered Species Act (16 U.S.C. 1531
Animal and Plant Health Inspection Service, USDA.
Extension of approval of an information collection; comment request.
In accordance with the Paperwork Reduction Act of 1995, this notice announces the Animal and Plant Health Inspection Service's intention to request an extension of approval of an information collection in support of our seed analysis program with Canada.
We invite you to comment on this docket. We will consider all comments that we receive by January 2, 2001.
Please send your comment and three copies to: Docket No. 00-100-1, Regulatory Analysis and Development, PPD, APHIS, Suite 3C03, 4700 River Road, Unit 118, Riverdale, MD 20737-1238.
Please state that your comment refers to Docket No. 00-100-1.
You may read any comments that we receive on this docket in our reading room. The reading room is located in room 1141 of the USDA South Building, 14th Street and Independence Avenue, SW., Washington, DC. Normal reading room hours are 8 a.m. to 4:30 p.m., Monday through Friday, except holidays. To be sure someone is there to help you, please call (202) 690-2817 before coming.
APHIS documents published in the
For information regarding the importation and interstate movement of foreign agricultural and vegetable seeds, contact Ms. Polly Lehtonen, Botanist, Permits and Risk Assessments, PPQ, APHIS, 4700 River Road Unit 133, Riverdale, MD 20737-1236; (301) 734-4394. For copies of more detailed information on the information collection, contact Mrs. Celeste Sickles, APHIS' Information Collection Coordinator, at (301) 734-7477.
The Plant Protection and Quarantine (PPQ) division of USDA's Animal and Plant Health Inspection Service (APHIS) is responsible for implementing the regulations that carry out the PPA.
Under the authority of the Federal Seed Act of 1939 (FSA), as amended, the USDA regulates the importation and interstate movement of certain agricultural and vegetable seeds.
Specifically, our regulations are designed to implement Title III of the FSA, “Foreign Commerce,” which requires shipments of imported agricultural and vegetable seeds to be labeled correctly and to be tested for the presence of noxious weeds as a condition of entry into the United States.
Under the authority of the FSA, we have established a seed analysis program with Canada that allows U.S. companies that import seed for cleaning or processing to enter into compliance agreements with us (APHIS). This program eliminates the need for sampling shipments of Canadian-origin seed at the border and allows certain seed importers to clean seed without the direct supervision of an APHIS inspector. In this way, the importation of Canadian-origin seeds into the United States is safely expedited without compromising the precautions we take to ensure that imported seeds do not pose a health threat to U.S. agriculture.
Our seed analysis program entails the use of several information collection activities, including requirements for a declaration of importation, container labeling, notification of seed location, a seed return request, seed analysis certificates, seed identity maintenance, and associated recordkeeping.
We are asking the Office of Management and Budget (OMB) to approve, for an additional 3 years, our use of these information collection activities in connection with our seed analysis program.
The purpose of this notice is to solicit comments from the public (as well as affected agencies) concerning this information collection activity. These comments will help us:
(1) Evaluate whether the information collection is necessary for the proper performance of our Agency's functions, including whether the information will have practical utility;
(2) Evaluate the accuracy of our estimate of the burden of the information collection, 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, through use, as appropriate, of automated, electronic, mechanical, and other collection technologies,
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.
Farm Service Agency, USDA.
Notice of interim meeting.
The National Drought Policy Commission recommended that a National Drought Council (Council) be established to coordinate activities between and among Federal Agencies, States, local governments, tribes and others. The Council was established through a Memorandum of Understanding (MOU). The first meeting of the Council will be held November 9, 2000. All meetings are open to the public; however, seating is limited and available on a first-come basis.
The Council will meet on November 9, 2000, from 9:00 a.m. to 11:30 a.m. in Room 221-A, Jamie L. Whitten Building, 12th and Jefferson Drive, SW, Washington, D.C. and from 12:30 to 3:30 p.m. in Room 4960-S of the United States Department of Agriculture South Building at 1400 Independence Avenue, SW, Washington, D.C. All times noted are Eastern Standard Time. The first part of the meeting will be devoted to the organization of the Council. The remainder of the meeting will be dedicated to establishing a work plan and other Council business.
Leona Dittus, Executive Director, Interim National Drought Council, United States Department of Agriculture (USDA), 1400 Independence Avenue, SW, Room 6701-S, Stop 0501, Washington, D.C., 20250-0501 or telephone (202) 720-3168; FAX (202) 720-9688; internet
The purpose of the MOU is to establish a more comprehensive, integrated, coordinated approach toward reducing the impacts of drought through better preparedness, monitoring and prediction, risk management, and response to drought emergencies in the United States. The Council will encourage cooperation and coordination between and among Federal, State, local, and tribal governments and others, relative to preparation for and response to serious drought emergencies. The Council is not a source of consensus advice and therefore is not subject to the Federal Advisory Committee Act. Activities of the Council include providing coordination to: (a) resolve drought related issues, (b) exchange information about lessons learned, and (c) improve public awareness of the need for drought planning and mitigation measures. The Council will be co-chaired by the Secretary of Agriculture or his designee, and a non-Federal co-chair shall be selected from among the members who are not Federal officers or employees. Administrative staff support essential to the execution of the Council's responsibilities shall be provided by USDA. The Council will continue in effect for 5 years or until Congress establishes a permanent National Drought Council.
If special accommodations are required, please contact Leona Dittus, at the address specified above, by COB November 7, 2000.
Forest Service, USDA.
Notice of Intent to prepare environmental impact statement (EIS).
The USDA Forest Service intends to prepare an environmental impact statement for revising the Hoosier National Forest Land and Resource Management Plan (Forest Plan) pursuant to 16 U.S.C. 1604(f)(5) and USDA Forest Service National Forest System Land and Resource Management Planning regulations. The revised Forest Plan will supersede the current Forest Plan, which the regional forester approved September 17, 1985, and has been amended 4 times. This notice describes the focus areas of change, the estimated dates for filing the EIS, the information concerning public participation, and the names and addresses of the responsible agency official and the individual who can provide additional information.
We need to receive your comments on this Notice of Intent in writing by January 31, 2001. The Draft EIS should be available for public review by December 2003. The Final EIS and revised Forest Plan should be completed by December 2004.
Send written comments to: NOI-FP Revision, Hoosier National Forest, 811 Constitution Avenue, Bedford, IN 47421, or direct electronic mail to: “r9 hoosier website”@fs.fed.us. ATTN: Forest Plan Revision
Regis Terney, Forest Planner, at 812-275-5987. TDD 812-275-7817; or direct electronic mail to: “r9 hoosier website”@fs.fed.us, or access the forest web page at www.fs.fed.us/r9/hoosier
The Regional Forester for the Eastern Region gives notice of the agency's intent to prepare an EIS to revise the Hoosier National Forest Plan. The Regional Forester approved the original Hoosier National Forest Plan in September 1985. In April 1991, the Regional Forester approved a significant amendment that substantially replaced the 1985 Forest Plan. This plan guides the overall management of the Hoosier National Forest. We make six primary decisions in the Forest Plan:
By the requirements of the National Forest Management Act, national forests must revise the Forest Plan at least every 15 years (U.S.C. 1604[f][5]). At this time, there are two reasons to revise the 1991 Forest Plan: (1) It is nearly 15 years since the Regional Forester approved the original plan, and (2)
In many south-central Indiana communities, people expect important products from managed forests such as: timber for wood products, minerals, and game species for hunting. People also value the opportunities forests provide for enjoying recreation, solitude, and scenic beauty. The Hoosier National Forest is integral to the sense of place for communities across south-central Indiana. When making decisions in the revised plan, we would examine economic and social impacts to local communities and at a broader regional level, as well as biological impacts.
We propose to narrow the scope of revising the Forest Plan, focusing on topics identified as being most critically in need of change. These were identified through public comment and through monitoring and evaluation:
• Conservation of Endangered and Threatened Species Habitat;
• Maintain and Restore Sustainable Ecosystems;
• Maintain and Restore Watershed Health;
• Protect our Cultural Heritage;
• Provide for a Visually Pleasing Landscape;
• Provide Recreation Use in Harmony with Natural Communities;
• Provide a Useable Landbase; and,
• Provide for Human and Community Development.
We propose to add the goal of conservation of endangered species and threatened species habitat to further demonstrate our commitment to the Endangered Species Act of 1973. We propose to change our current goal of protect and manage ecosystems to maintain and restore sustainable ecosystems to adapt to the sustainable forest management strategy of the USDA Forest Service Natural Resource Agenda. We propose to add the goal to maintain and restore watershed health. We believe it is important to reaffirm the historic mission of the Hoosier National Forest for watershed protection and restoration.
Additional detail on the Revision Topics is available on request, in the form of the document titled “Need for Change, Description of Proposal for Revising the Forest Plan of the Hoosier National Forest”. You are encouraged to review this additional document before commenting on the Notice of Intent. You may request the additional information by calling the phone number listed above, by writing or e-mailing to the address listed in this notice, or by accessing the forest web page at www.fs.fed.us/r9/hoosier.
We propose the following direction or actions:
• Identify desired conditions for healthy watersheds and riparian areas;
• Add direction to protect and restore watershed health;
• Update riparian guidance;
• Add desired conditions to sustain a wide range of habitat to provide for population viability of plant and animal populations and existing biotic communities within the capability of the Hoosier National Forest;
• Add in ecosystem approach that focuses on ecosystem integrity to complement the focus on population viability in assessment and management;
• Complete a population viability assessment;
• Maintain our current policy to allow a full range of vegetative management practices in Management Area 2.8;
• Revise the management indicator list consistent with planning regulations;
• Evaluate the potential Research Natural Areas using ecosystem-based selection criteria;
• Maintain our current policy precluding Off-Road Vehicle use on the forest (all-terrain vehicles, motorcycles, and four-wheel-drive trucks);
• Update the forest roadless inventory consistent with Forest Service policy;
• Follow the national framework to implement roadless areas initiative;
• Replace the Visual Quality Objectives with the Scenery Management System; and,
• Update the monitoring plan.
The Department of Agriculture expects to publish the final planning rule during the fall of 2000. The proposed rule directs how to conduct forest planning. Given the information in the draft rule and the projected timelines, the Hoosier National Forest Plan revision is expected to be finished under the new planning rule. When the new planning rule is published we will evaluate the changes in analysis standards and we will likely publish an amended notice of intent.
We will consider a range of alternatives when revising the Forest Plan. The alternatives will address different options to resolve issues over the focus areas of change listed above and to fulfill the purpose and need. A “no-action alternative” is required, meaning that management would continue under the existing Forest Plan. Alternatives will provide different ways to address and respond to issues identified during the scoping process.
The alternatives will display different mixes of recreation opportunities and experiences. We will examine alternatives that address the public's concerns for less timber harvest, for greater timber harvest, and meeting currently planned harvest levels. The alternatives will display different mixes of wildlife habitats across the forest. The mix will vary by the objectives of the particular alternative, though each alternative will contain the habitat necessary to maintain viable populations of plant and animal species. Management of roadless areas will vary by the objectives of any particular alternative, physical criteria for evaluating each individual roadless area, and public input.
We may make other minor changes, particularly in the guidance chapter of the Forest Plan, to reflect changes made when addressing the above revision topics. The USDA Forest Service proposal does not include any substantial changes to management area allocations. In 1991, we decided the basic philosophy of providing for plant and animal communities guides our forest management activities. As a result, we would not revisit this decision but would carry forward the 1991 plan amendment framework for biological diversity conservation.
We are committed to participate in statewide land management planning and the use of State watershed assessment results and coordination efforts, such as best management practices development for forest management. We would consider technical guidelines developed through these processes when developing guidance and will use the results of watershed assessments.
We are now soliciting comments and suggestions from federal agencies, state and local governments, individuals, and organizations on the scope of the analysis to be included in the draft
In fall 2000, we would release our notice of intent and proposal. We will have many types of public involvement including: 60-day formal comment period, public meetings, written comments, website and e-mail.
In the years 2001 and 2002, we would work on alternative development and issue validation. We will have many types of public involvement including: public workshops, collaborative meetings, written comments, website, and e-mail.
In the years 2002 and 2003 we would release our proposed revised Forest Plan and a draft environmental impact statement. We will have many types of public involvement including 90-day formal comment period, public meetings, and written comments.
During 2004, we would release the decision, final revised Forest Plan, final environmental impact statement, and record of decision. We will have informational meetings to explain the decision on final Forest Plan.
The Forest Service will host a series of public meetings to (1) establish multiple opportunities for the public to generate ideas, concerns, and alternatives, (2) present and clarify proposed changes to the Forest Plan; (3) describe ways that individuals can respond to this Notice of Intent; and (4) accept comments from the public on this proposal for revising the Forest Plan.
We will provide the public with general notices on opportunities to participate through mailings, news releases, public meetings, and website (www.fs.fed.us/r9/hoosier). In addition to formal opportunities for public comment, we will consider comments received at any time throughout the revision process.
Below is the schedule of initial meetings based on publication of this NOI. We intend to have the most meetings in the first 30 days to give the public time to gather information, participate in meetings and then formulate comments before the close of the 60-day comment period. Additional meetings will be scheduled as needed.
Additionally, pursuant to 7 CFR 1.27(d), any persons may request the agency to withhold a submission from the public record by showing how the FOIA (Freedom of Information Act) permits such confidentiality. Persons requesting such confidentiality should be aware that under FOIA confidentiality may be granted in only very limited circumstances, such as to protect trade secrets.
The Forest Service will inform the requester of the agency's decision regarding the request for confidentiality and where the requester is denied, the agency will return the submission and notify the requester that the comments may be resubmitted with or without name and address within 90 days.
The Forest Service believes, at this early stage, that it is important to give reviewers notice of several court rulings related to public participation in the environmental review process. First, reviewers of draft environmental impact statements must structure their participation in the environmental review of the proposal so that it is meaningful and alerts an agency to the reviewer's position and contentions.
To assist the Forest Service in identifying and considering issues and concerns on the proposed action, comments on the draft environmental impact statement should be specific as possible. It is also helpful if comments refer to specific pages or chapters of the draft statement. Comments may also address the adequacy of the draft environmental impact statement or the merits of the alternatives formulated and discussed in the statement. Reviewers may wish to refer to the Council of Environmental Quality Regulations (http://ceq.eh.doe.gov.nepa/nepanet.htm) for implementing the procedural provision of the National Environmental Policy Act at 40 CFR 1503.3 in addressing these points.
Forest Service, USDA.
Notice of meeting.
The Southwest Washington Provincial Advisory Committee will meet on Wednesday, November 15, 2000, at the Gifford Pinchot National Forest Office, located at 10600 NE 51st Circle, Vancouver, Washington. The meeting will begin at 9 a.m. and continue until 4:15 p.m. The purpose of the meeting is to: (1) Review the National Roads Policy; (2) Discuss the mission of the committee, and (3) Provide for a Public Open Forum. All Southwest Washington Provincial Advisory Committee meetings are open to the public. Interested citizens are encouraged to attend. The “open forum” provides opportunity for the public to bring issues, concerns, and discussion
Direct questions regarding this meeting to Linda Turner, Public Affairs Specialist, at (360) 891-5195, or write Forest Headquarters Office, Gifford Pinchot National Forest, 10600 NE. 51st Circle, Vancouver, WA 98682.
DOC has submitted to the Office of Management and Budget (OMB) for clearance the following proposal for collection of information under the provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35).
Copies of the above information collection proposal can be obtained by calling or writing DOC Forms Clearance Officer, Madeleine Clayton, (202) 482-3129, Department of Commerce, Room 6086, 14th and Constitution Avenue, NW, Washington DC 20230 or by E-mail to MClayton@doc.gov.
Written comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice to Paul Bugg, OMB Desk Officer, Room 10201, New Executive Office Building, Washington DC 20503.
DOC has submitted to the Office of Management and Budget (OMB) for clearance the following proposal for collection of information under the provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35).
Also, the data from the BE-605 survey complement data from BEA's other ongoing surveys of foreign direct investment in the United States, namely the BE-13, Initial Report on a Foreign Person's Direct or Indirect Acquisition, Establishment, or Purchase of the Operating Assets, of a U.S. Business Enterprise, Including Real Estate, and the BE-12 (benchmark) and BE-15 (annual) surveys, which provide data on the overall operations of U.S. affiliates.
You may obtain copies of the above information collection proposal by calling or writing Madeleine Clayton, Departmental Forms Clearance Officer, Office of the Chief Information Officer, (202) 482-3129, Department of Commerce, Room 6086, 14th Street and Constitution Avenue, NW, Washington, DC 20230.
Send comments on the proposed information collection within 30 days of publication of this notice to Paul Bugg, OMB Desk Officer, Room 10201, New Executive Office Building, Washington, DC 20503.
Import Administration, International Trade Administration, Department of Commerce.
Notice of Final Results of Expedited Sunset Review: Aramid Fiber formed of Poly Para-Phenylene Terephthalamide from the Netherlands.
On June 23, 2000, the Department of Commerce (“the Department”) published a notice of preliminary results of the full sunset review of the antidumping duty order on aramid fiber formed of poly para-phenylene terephthalamide (“aramid fiber”) from the Netherlands (64 FR 39124) pursuant to section 751(c) of the Tariff Act of 1930, as amended (“the Act”). We provided interested parties an opportunity to comment on our preliminary results. We received comments from both domestic and respondent interested parties. No public hearing was requested by the parties. As a result of this review, the Department finds that revocation of the antidumping order would likely lead to continuation or recurrence of dumping at the levels indicated in the Final Results of Review section of this notice.
Martha V. Douthit or James P. Maeder, Office of Policy for Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-5050 or (202) 482-3330, respectively.
This review is being conducted pursuant to sections 751(c) and 752 of the Act. The Department's procedures for the conduct of sunset reviews are set forth in
On June 23, 2000, the Department published in the
On August 7, 2000, the domestic interested party, E.I. Dupont de Nemours & Company (“DuPont”), submitted a case brief within the deadline specified in 19 CFR 351.309(c)(1)(i). On August 14, 2000, the respondent interested party, Twaron Products V.o.F. and Twaron Products, Inc. (formerly, Azko) (collectively, “Twaron”), submitted rebuttal briefs within the deadline specified in 19 CFR 351.309(c)(1)(i). The Department provided interested parties an opportunity to request a public hearing, in accordance with 19 CFR 351.310. In this sunset review, no public hearing was requested or held.
The products covered by this review are all forms of aramid fiber from the Netherlands. These consist of aramid fiber in the form of filament yarn (including single and corded), staple fiber, pulp (wet or dry), spun-laced and spun-bonded nonwovens, chopped fiber, and floc. Tire cord is excluded from the class or kind of merchandise under review. This merchandise is currently classifiable under the Harmonized Tariff Schedule of the United States (“HTSUS”) item numbers 5402.10.3020, 5402.10.3040, 5402.10.6000, 5503.10.1000, 5503.10.9000, 5601.30.0000, and 5603.00.9000. The HTSUS item numbers are provided for convenience and Customs purposes. The written description of the scope remains dispositive.
All issues raised in the case and rebuttal briefs by parties to this sunset review are addressed in the “Issues and Decision Memorandum” (“Decision Memo”) from Jeffrey A. May, Director, Office of Policy, Import Administration, to Troy H. Cribb, Assistant Secretary for Import Administration, dated October 26, 2000, which is hereby adopted by this notice. The issues discussed in the Decision Memo include the likelihood of continuation or recurrence of dumping and the magnitude of the margin likely to prevail were the order revoked. Parties can find a complete discussion of all issues raised in this review and the corresponding recommendations in this public memorandum, which is on file in room B-099 of the main Commerce Building. In addition, a complete version of the Decision Memorandum can be accessed directly on the Web at http://ia.ita.doc.gov. The paper copy and electronic version of the Decision Memo are identical in content.
We determine that revocation of the antidumping duty order on aramid fiber from the Netherlands would be likely to lead to continuation or recurrence of dumping at the percentage weighted-average margins listed below:
This notice serves as the only reminder to parties subject to administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305 of the Department's regulations. Timely notification of return/destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation.
This five-year (“sunset”) review and notice are in accordance with sections 751(c), 752, and 777(i)(1) of the Act.
Import Administration, International Trade Administration, Department of Commerce.
Notice of final results of full sunset review: Grain-oriented electrical steel from Italy.
On June 23, 2000, the Department of Commerce (“the Department”) published in the
Becky Hagen or James Maeder, Office of Policy for Import Administration, International Trade Administration, U.S. Department of Commerce, 14th and Constitution, NW., Washington, DC 20230; telephone: (202) 482-1277 or (202) 482-3330, respectively.
November 1, 2000.
These reviews were conducted pursuant to sections 751(c) and 752 of the Act. The Department's procedures for the conduct of sunset reviews are set forth in Procedures for Conducting Five-year (“Sunset”) Reviews of Antidumping and Countervailing Duty Orders, 63 FR 13516 (March 20, 1998) (“Sunset Regulations”) and in 19 CFR part 351 (1999) in general. Guidance on methodological or analytical issues relevant to the Department's conduct of sunset reviews is set forth in the Department's Policy Bulletin 98:3—Policies Regarding the Conduct of Five-year (“Sunset”) Reviews of Antidumping and Countervailing Duty Orders; Policy Bulletin, 63 FR 18871 (April 16, 1998) (“Sunset Policy Bulletin”).
The merchandise subject to this review is Italian GOES, which is a flat-rolled alloy steel product containing by weight at least 0.6 percent of silicon, not more than 0.08 percent of carbon, not more than 1.0 percent of aluminum, and no other element in an amount that would give the steel the characteristics of another alloy steel, of a thickness of no more than 0.56 millimeter, in coils of any width, or in straight lengths which are of a width measuring at least ten times the thickness. The merchandise is currently classifiable in the Harmonized Tariff Schedule (“HTS”) under item numbers 7225.10.0030, 7226.10.1030, 7226.10.5015, and 7226.10.5065. Although HTS subheadings are provided for convenience and customs purposes, our written description of the scope of this proceeding is dispositive.
On June 23, 2000, the Department of Commerce (“the Department”) published in the
On July 27, 2000, Acciai Speciali Terni S.p.A. and Acciai Speciali Terni USA, Inc. (together “AST”) requested a hearing in the sunset review. On August 7, 2000, within the deadline specified in 19 CFR 351.309(c)(1)(i), we received a case brief on behalf of AST; on August 14, 2000, we received a rebuttal brief from domestic interested parties. The hearing was held on September 26, 2000.
All issues raised in the case and rebuttal briefs by parties to this sunset review are addressed in the “Issues and Decision Memorandum” (“Decision Memo”) from Jeffrey A. May, Director, Office of Policy, Import Administration, to Troy H. Cribb, Acting Assistant Secretary for Import Administration, dated October 26, 2000, which is hereby adopted by this notice. The issues discussed in the attached Decision Memo include the likelihood of continuation or recurrence of countervailable subsidies and the net countervailable subsidy likely to prevail were the order revoked. Parties can find a complete discussion of all issues raised in this review and the corresponding recommendations in this public memorandum which is on file in the Central Records Unit, room B-099, of the main Commerce Building.
In addition, a complete version of the Decision Memo can be accessed directly on the Web at http://ia.ita.doc.gov/frn/, under the heading “Italy.” The paper copy and electronic version of the Decision Memo are identical in content.
As a result of this review, the Department finds that revocation of the countervailing duty orders would be likely to lead to continuation or recurrence of a countervailable subsidy at the rates listed below:
In the
This notice serves as the only reminder to parties subject to administrative protective order (“APO”) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305 of the Department's regulations. Timely notification of return/destruction of APO material or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation.
This five-year (“sunset”) review and notice are in accordance with sections 751(c), 752, and 777(i)(1) of the Act.
Pursuant to section 6(c) of the Educational, Scientific and Cultural Materials Importation Act of 1966 (Pub. L. 89-651; 80 Stat. 897; 15 CFR part 301), we invite comments on the question of whether instruments of equivalent scientific value, for the purposes for which the instruments shown below are intended to be used, are being manufactured in the United States.
Comments must comply with 15 CFR 301.5(a)(3) and (4) of the regulations and be filed within 20 days with the Statutory Import Programs Staff, U.S. Department of Commerce, Washington, DC 20230. Applications may be examined between 8:30 A.M. and 5:00 P.M. in Room 4211, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC.
Committee for the Implementation of Textile Agreements (CITA).
Issuing a directive to the Commissioner of Customs exempting certain textile and apparel articles from quota, Guaranteed Access Levels (GALs), visa and GAL certification requirements.
October 2, 2000.
Naomi Freeman, International Trade Specialist, Office of Textiles and Apparel, U.S. Department of Commerce, (202) 482-4212.
Section 211 of the Trade and Development Act of 2000 (19 U.S.C. 2703); Presidential Proclamation 7351 of October 2, 2000; Section 204 of the Agricultural Act of 1956, as amended (7 U.S.C. 1854); Executive Order 11651 of March 3, 1972, as amended.
Section 211 of the Trade and Development Act of 2000 provides duty and quota-free treatment for certain textile and apparel articles imported from designated Caribbean Basin Trade Partnership Act (CBTPA) beneficiary countries. On October 2, 2000, the President designated Costa Rica, Dominican Republic, El Salvador, Guatemala, Haiti, Jamaica and Panama, among others, as CBTPA beneficiary countries (Proclamation 7351, 65 FR 59329, published on October 4, 2000).
Effective October 2, 2000, the U.S. Trade Representative determined that these countries, among others, have implemented and follow, or are making substantial progress towards implementing and following, the customs procedures required by the CBTPA, and the U.S. Trade Representative amended the Harmonized Tariff Schedule of the United States (HTS) to provide the tariff treatment authorized under the CBTPA for goods from these countries (65 FR 60236, published on October 10, 2000).
The CBTPA provides that textile and apparel articles that qualify for CBTPA benefits shall enter the United States free of duty and free of any quantitative restriction, limitation, or consultation level. Therefore, CITA directs the U.S. Customs Service no longer to impose specific limits on textile and apparel articles from Costa Rica, Dominican Republic, El Salvador, Guatemala, Haiti, Jamaica and Panama that qualify for preferential treatment under Section 211 of the Trade and Development Act of 2000, and no longer to impose Guaranteed Access Levels (GALs), visa and GAL certification requirements for these articles.
Benefits under Section 211 for certain knit apparel from all beneficiary countries are limited in each of the one-year periods, beginning on October 1, 2000 and ending on September 30, 2008 (19 U.S.C. 2703(b)(2)(A)(iii)(I, II). Similarly, benefits under this provision for t-shirts are also limited during this period (19 U.S.C. 2703(b)(2)(A)(iii)(III, IV). Applicable quota and visa
Dear Commissioner:
This directive exempts from otherwise applicable quota, Guaranteed Access Levels (GALs), visa and GAL certification requirements certain textile and apparel articles, produced or manufactured in Costa Rica, Dominican Republic, El Salvador, Guatemala, Haiti, Jamaica, and Panama, and exported to the United States.
Effective on October 2, 2000, textile and apparel articles, imported from Costa Rica, Dominican Republic, El Salvador, Guatemala, Haiti, Jamaica or Panama, qualifying for duty and quota-free treatment under Section 211 of the Trade and Development Act of 2000, are not subject to otherwise applicable quota, GALs, visa or GAL certification requirements.
Benefits under Section 211 for certain knit apparel from all beneficiary countries are limited in each of the one-year periods, beginning on October 1, 2000 and ending on September 30, 2008. (19 U.S.C. 2703(b)(2)(A)(iii)(I, II) Similarly, benefits under this provision for t-shirts are also limited during this period. (19 U.S.C. 2703(b)(2)(A)(iii)(III, IV) Applicable quota and visa requirements will apply to imports in excess of each of the one-year limits.
The Committee for the Implementation of Textile Agreements has determined that these actions fall within the foreign affairs exception to the rulemaking provisions of 5 U.S.C. 553(a)(1).
Sincerely,
Corporation for National and Community Service.
Notice.
In a document published in the
Our address is 1201 New York Avenue NW, Washington, D.C. 20525.
For further information, contact Frank Trinity at (202) 606-5000, ext. 256. This notice may be requested in an alternative format for the visually impaired.
All recipients of assistance from the Corporation for National and Community Service under the National and Community Service Act of 1990, as amended, and the Domestic Volunteer Service Act of 1973, as amended, are hereby on notice that their Corporation-assisted programs and activities are considered “training and education activities” for the purposes of Title IX of the Education Amendments of 1972, as amended. These programs and activities include, but are not limited to, those listed in the following table:
Department of Defense (DoD).
Correction to notice.
DoD is issuing a correction to the notice published at 65 FR 63844 on October 25, 2000, that requested comments regarding a proposed extension of an approved information collection requirement. The notice inadvertently omitted recordkeeping hours from the estimate of annual burden hours shown for the information collection requirement.
Ms. Amy Williams, Defense Acquisition Regulations Council, OUSD (AT&L)DP(DAR), IMD 3C132, 3062 Defense Pentagon, Washington, DC 20301-3062. Telephone (703) 602-0288; telefax (703) 602-0350.
In the issue of Wednesday, October 25, 2000, on page 63844, in the third column, in the
Notice.
The Department of Defense has submitted to OMB for clearance, the following proposal for collection of information under the provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35).
Written comments and recommendations on the proposed information collection should be sent to Mr. Springer at the Office of Management and Budget, Desk Officer for DoD, Room 10236, New Executive Office Building, Washington, DC 20503.
Written requests for copies of the information collection proposal should be sent to Mr. Cushing WHS/DIOR, 1215 Jefferson Davis Highway, Suite 1204, Arlington, VA 22202-4302.
Deputy Chief of Staff for Personnel, U.S. Army, DoD.
Notice (Request for comments).
The Department of the Army, Office of the Deputy Chief of Staff for Personnel, in coordination with the U.S. Army Reserves and the Army National Guard, announce the final revision of the Integrated Total Army Personnel Data Base (ITAPDB) Data Element Standard Version 1.0 (VI.0), dated 10 October 2000. Comments are invited on ways to: (a) enhance the quality and clarity of the information contained therein; and (b) continue the establishment of a common set of data element standard that will enable the Army to eliminate redundant data, ensure commonality of information, reduce data conversion cost, and align with DoD development initiatives.
Consideration will be given to all comments received by December 1, 2000. All comments received within 30 days of publication of this notice will be considered for inclusion into ITAPDB Data Element Standard V2.0.
Written comments and recommendations on the proposed information collection should be sent to Director, Information Systems, Office of the Deputy Chief of Staff for Personnel, Attn: DAPE-ZXI (Ms. Golden Giddings/Ms. Angela McCoy), 300 Army Pentagon, Washington, DC 20310. Consideration will be given to all comments received within 30 days of the date of publication of this notice. E-mail address for Ms. Giddings is giddigl@hqda.army.mil and for Ms. McCoy is mccoyak@hqda.army.mil
Mr. Paul Oestreich, (703) 325-8877, oestreip@hoffman.army.mil
The ITAPDB establishes data element standard that will be shared among Army information systems horizontally between Army communities and vertically between field level and DA human resource information systems. Establishing a common set of data element standards enables the Army to eliminate redundant data, ensure commonality of information, reduce data conversion costs, and align with DoD development initiatives. As ITAPDB Data Element Standard evolves, it will apply to intelligence, operations, fire support, logistics, safety, transportation, human resource, military police, medical, dental, finance, chaplain, legal, post operation, civilian personnel, moral and welfare, recreation, force management, education center, inspector general and contractor support mission areas as it pertains to people related exchange of information or data.
This standard is essential to achieve effective and efficient system interoperability among systems that support all Army human resources—soldier, civilian, or contractor in active or retired status.
Individuals desiring a copy of the finalized ITAPDB Data Element Standard Version 1.0 should e-mail or write to Ms. Giddings or Mr. Oestreich at the above addresses.
Take notice that on October 24, 2000, the entities listed in the caption above made compliance filings pursuant to 18 CFR 35.34(c) and the Commission's Order No. 2000.
Any person desiring to be heard or to protest such filings should file a motion to intervene, comments, or protest with the Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426, in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 385.214). All such motions, comments and protests should be filed on or before November 20, 2000. Protests will be considered by the Commission to determine the appropriate action to be taken, but will not serve to make protestants parties to the proceedings. Any person wishing to become a party must file a motion to intervene. Copies of this filing are on file with the Commission and are available for public inspection. This filing may also be viewed on the Internet at http://www.ferc.fed.us/online/rims.htm (call 202-208-2222 for assistance). Beginning November 1, 2000, comments and protests may be filed electronically via the internet in lieu of paper. See, 18 CFR 385.2001(a)(1)(iii) and the instructions on the Commission's web site at
Take notice that on October 16, 2000, El Paso Natural Gas Company (El Paso), Post Office Box 1492, El Paso, Texas 79978, filed in Docket No. CP01-12-000 an application pursuant to Sections 7(c) and (b) of the Natural Gas Act for a certificate of public convenience and necessity to relocate and replace 6.88 miles of 16-inch diameter pipe on Line No. 2039 with 24-inch pipe, and to relocate the existing Southern Avenue Meter Station located in Maricopa County, Arizona. In addition, El Paso requests permission and approval to abandon the replaced 16-inch diameter Line No. 2039 facilities and four miscellaneous tap facilities currently located on Line No. 2039, all as more fully set forth in the application which is on file with the Commission and open to public inspection. This filing may be viewed on the web at
El Paso states that tremendous residential and commercial growth in the West Phoenix area and its environs has raised serious issues relating to right-of-way encroachment and Department of Transportation (DOT) compliance. In response to these issues, El Paso states that it will relocate 6.88 miles of Line No. 2039 currently located at Elliot Road and 43rd Avenue in Maricopa County, Arizona, to a location that is east of the existing route. El Paso states that the increase in residential and commercial growth in the West Phoenix area has also prompted an increased need for the delivery of natural gas from Line No. 2039. It is stated that Arizona Public Service Company (APS) has requested El Paso to deliver an additional 95 MMcf per day of natural gas to its West Phoenix Power Plant located in Maricopa County, Arizona. It is stated that in order to accommodate APS' load growth requirement, the relocated Line No. 2039 will consist of 24-inch diameter pipe instead of 16-inch diameter pipe. In addition, it is stated that El Paso will relocate the existing Southern Avenue meter Station currently located on the existing 16-inch diameter Line No. 2039 to a new location along the proposed 24-inch alignment. El Paso states that once Line No. 2039 has been relocated, replaced and in service, El Paso will abandon in place and by removal, the replaced 16-inch Line No. 2039 pipeline facilities and four miscellaneous tap facilities currently located on Line No. 2039.
El Paso states that the estimated cost of the proposed project is $6,579,988. El Paso states that the project will be financed with the use of internally generated funds and that APS has agreed to reimburse El Paso 50 percent of the cost of pipe relocation and replacement of the 6.88 miles of Line No. 2039. El Paso states that it will continue to charge its existing Part 284 rates for transportation. El Paso further states that the transportation rates to existing customers currently being served through Line No. 2039 will not change as a result of this project.
Any questions regarding the application should be directed to A.W. Clark, Vice President, El Paso Natural Gas Company at (915) 496-2600, Post Office Box 1492, El Paso, Texas 79978.
Any person desiring to be heard or to make any protest with reference to said application should on or before November 16, 2000, file with the Federal Energy Regulatory Commission, 888 First Street, N.E., Washington, D.C. 20426, a motion to intervene or a protest in accordance with the requirements of the Commission's Rules of Practice and Procedure (18 CFR 385.214 or 385.211) and the Regulations under the Natural Gas Act (18 CFR 157.10). All protests filed with the Commission will be considered by it in determining the appropriate action to take but will not serve to make the protestants parties to the proceeding. Any person wishing to become a party to a proceeding or to participate as a party in any hearing therein must file a motion to intervene in accordance with the Commission's Rules. Beginning November 1, 2000, comments and protests may be filed electronically via the internet in lieu of paper. See, 18 CFR 385.2001(a)(1)(iii) and the instructions on the Commission's web site at http://www.ferc.fed.us/efi/doorbell.htm.
Take further notice that, pursuant to the authority contained in and subject to the jurisdiction conferred upon the Federal Energy Regulatory Commission by Sections 7 and 15 of the Natural Gas Act and the Commission's Rules of Practice and Procedure, a hearing will
Under the procedure herein provided for, unless otherwise advised, it will be unnecessary for El Paso to appear or be represented at the hearing.
Take notice that on October 24, 2000, Koch Gateway Pipeline Company (Koch Gateway), P.O. Box 1478, Houston, Texas 77251-1478, filed an application in Docket No. CP01-18-000 pursuant to Section 7(b) of the Natural Gas Act (NGA) and Section 157.18 of the Commission's Regulations for permission and approval to abandon by removal approximately 12,497 feet of 16-inch pipeline from Station Number 945+63 to Station Number 820+66 on its Latex-Forth Worth Mainline designated as Index 1
This filing may be viewed on the web at http://www.ferc.fed.us/online/rims.htm (call 202-208-2222 for assistance). Any questions regarding this application should be directed to: Kyle Stephens, director of Certificates, Koch Gateway Pipeline Company, P.O. Box 1478, Houston, Texas, 77251-1478, (713) 544-7309.
Koch Gateway states that the SWEPCO Segment is in direct conflict with an active surface lignite mine operated by Southwestern Electric Power Company (SWEPCO), a division of American Electric Power. Koch Gateway states that in November 1996, Koch Gateway moved the remaining customers from Index 1 to Index 65-2 and idled Index 1 from Station Number 00+0 to Station Number 1190+15 in east Texas. SWEPCO operates an active surface lignite coal mine that provides the lignite fuel for its local electric generation facility, the Pirkey Power Plant, in the vicinity of the east end of Index 1. For the surface area covered by the mine, SWEPCO owns the land in fee or underlying landowners have assigned their surface rights to SWEPCO. Although portions of both Index 1 and Index 65-2 have been relocated to accommodate previous surface mining activities, the mining activities will again be in direct conflict with Index 1 and Index 65-2. Koch Gateway will relocate the active line, Index 65-2,
Koch Gateway states it will provide the required landowner notifications and notifications to government entities affected by the proposed project including towns, communities and government agencies. Also, Koch Gateway states that public notice of the proposed project will be published twice in a daily or weekly newspaper of general circulation in each county in which the project is located; and further, copies of the application will be available at a library in a central location in each county in which the project is located.
Any person desiring to be heard or to make any protest with reference to said application should on or before November 16, 2000, file with the Federal Energy Regulatory Commission, Washington, D.C. 20426, a petition to intervene or a protest in accordance with the requirements of the Commission's Rules of Practice and Procedure (18 CFR 385.214 or 385.211) and the Regulations under the Natural Gas Act (18 CFR 157.10). All protests filed with the Commission will be considered by it in determining the appropriate action to be taken but will not serve to make the protestants parties to the proceeding. Any person wishing to become party to a proceeding or to participate as a party in any hearing therein must file a petition to intervene in accordance with the Commission's Rules. Beginning November 1, 2000, comments and protests may be filed electronically via the internet in lieu of paper. See, 18 CFR 385.2001(a)(1)(iii) and the instructions on the Commission's web site at http;//www.ferc.fed.us/efi/doorbell.htm.
Take further notice that, pursuant to the authority contained in and subject to the jurisdiction conferred upon the Federal Energy Regulatory Commission by Sections 7 and 15 of the Natural Gas Act and the Commission's Rules of Practice and Procedure, a hearing will be held without further notice before the Commission or its designee on this application if no petition to intervene is filed within the time required herein, if the Commission on its own review of the matter finds that a grant of the certificate is required by the public convenience and necessity. If a petition for leave is timely filed, or if the Commission on its own motion believes that a formal hearing is required, further notice of such hearing will be duly given.
Under the procedure provided for, unless otherwise advised, it will be unnecessary for Koch Gateway to appear or be represented at the hearing.
Take notice that on October 19, 2000, Northern Natural Gas Company
Specifically, Northern requests authority to abandon and remove Unit #12, as skid-mounted 506 hp rental unit,
Any questions regarding the application should be directed to Keith L. Petersen, Director, Certificates and Report for Northern, 1111 South 103rd Street, Omaha, Nebraska 68124, at (402) 398-7421 or Michele Winckowski, Senior Regulatory Analyst, at (402) 398-7082.
Any person desiring to be heard or any person desiring to make any protests with reference to said application should on or before November 16, 2000, file with the Federal Energy Regulatory Commission, 888 First Street, N.E., Washington, D.C. 20426, a motion to intervene or a protest in accordance with the requirements of the Commission's Rules of Practice and Procedure (18 CFR 385.211 or 385.214) and the Regulations under the NGA (18 CFR 157.10). All protests filed with the Commission will be considered by it in determining the appropriate action to be taken but will not serve to make the protestants parties to the proceeding. Any person wishing to become a party to a proceeding or to participate as a party in any hearing therein must file a motion to intervene in accordance with the Commission's Rules. Beginning November 1, 2000, comments and protests may be filed electronically via the internet in lieu of paper. See, 18 CFR 385.2001(a)(1)(iii) and the instructions on the Commission's web site at http://www.ferc.fed.us/efi/doorbell.htm.
Take further notice that, pursuant to the authority contained in and subject to the jurisdiction conferred upon the Federal Energy Regulatory Commission by Sections 7 and 15 of the NGA and the Commission's Rules of Practice and Procedures, a hearing will be held without further notice before the Commission or its designee on this application if no motion to intervene is filed within the time required herein, if the Commission on its own review of the matter finds that permission and approval for the proposed abandonment are required by the public convenience and necessity. If a motion for leave to intervene is timely filed, or if the Commission on its own motion believes that a formal hearing is required, further notice of such hearing will be duly given.
Under the procedure herein provided for, unless otherwise advised, it will be unnecessary for Northern to appear or be represented at the hearing.
The staff of the Federal Energy Regulatory Commission (FERC or Commission) will prepare an environmental assessment (EA) that will discuss the environmental impacts of the Albany Compressor Station Project involving the operation of facilities by Southern Natural Gas Company (Southern) in Dougherty County, Georgia.
A fact sheet prepared by the FERC entitled “An Interstate Natural Gas Facility On My Land? What Do I Need To Know?” was attached to the project notice Southern provided to landowners. This fact sheet addresses a number of typically asked questions and how to participate in the Commission's proceedings. It is available for viewing on the FERC Internet website (www.ferc.fed.us).
Southern wants to reinstate a 1,232 horsepower reciprocating compressor unit at the Albany Compressor Station to full time service. At this time the unit is only used as a backup unit that is available in the event other facitlities on the system are taken out of service for maintenance or repair.
The location of the Albany Compressor Station is shown in appendix 1.
The compressor unit was installed at the Albany Compressor Station in 1982. No ground disturbance would be required. All activities would be confined to the existing Albany Compressor Station.
The National Environmental Policy Act (NEPA) requires the Commission to take into account the environmental impacts that could result from an action whenever it considers the issuance of a Certificate of Public Convenience and Necessity. NEPA also requires us
The EA will discuss impacts that could occur as a result of the change in the operation of the Albany Compressor Station. In particular the EA will focus on the changes in noise and air emissions resulting from the increased operation of the compressor unit.
We will also evaluate possible alternatives to the proposed project and make recommendations on how to lessen or avoid impacts on the various resource areas.
Our independent analysis of the issues will be in the EA. Depending on the comments received during scoping process, the EA may be published and mailed to Federal, state, and local agencies, public interest groups, interested individuals, affected landowners, newspapers, libraries, and the Commission's official service list for this proceeding. A comment period will be allotted for review if the EA is published. We will consider all comments on the EA before we make our recommendations to the Commission.
To ensure your comments are considered, please carefully follow the instructions in the public participation section below.
Because the compressor unit has already been installed, we have identified only two issues that we think deserve additional attention based on a preliminary review of the proposed facilities and the environmental information provided by Southern. This preliminary list of issues may be changed based on your comments and our analysis.
• Increase in air emissions caused by operating the compressor unit full time.
• Increase in noise from the compressor station.
You can make a difference by providing us with your specific comments or concerns about the project. By becoming a commentor, your concerns will be addressed in the EA and considered by the Commission. You should focus on the potential environmental effects of the proposal, alternatives to the proposal (including alternative locations), and measures to avoid or lessen environmental impact. The more specific your comments, the more useful they will be. Please carefully follow these instructions to ensure that your comments are received in time and properly recorded:
• Send an original and two copies of your letter to: David P. Boergers, Secretary, Federal Energy Regulatory Commission, 888 First St., NE., Room 1A, Washington, DC 20426.
• Label one copy of the comments for the attention of Gas 2.
• Reference Docket No. CP01-13-000.
• Mail your comments so that they will be received in Washington, DC on or before November 27, 2000. Beginning November 1, 2000, comments and protests may be filed electronically via the internet in lieu of paper. See, 18 CFR 385.2001(a)(1)(iii) and the instructions on the Commission's web site at http://www.ferc.fed.us/efi/doorbell.htm.
In addition to involvement in the EA scoping process, you may want to become an official party to the proceeding known as an “intervenor”. Intervenors play a more formal role in the process. Among other things, intervenors have the right to receive copies of case-related Commission documents and filings by other intervenors. Likewise, each intervenor must provide 14 copies of its filings to the Secretary of the Commission and must send a copy of its filings to all other parties on the Commission's service list for this proceeding. If you want to become an intervenor you must file a motion to intervene according to Rule 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.214) (see appendix 2). Only intervenors have the right to seek rehearing of the Commission's decision.
Affected landowners and parties with environmental concerns may be granted intervenor status upon showing good cause by stating that they have a clear and direct interest in this proceeding which would not be adequately represented by any other parties. You do not need intervenor status to have your environmental comments considered.
Additional information about the proposed project is available from the Commission's Office of External Affairs at (202) 208-0004 or on the FERC website (www.ferc.fed.us) using the “RIMS” link to information in this docket number. Click on the “RIMS” link, select “Docket #” from the RIMS Menu, and follow the instructions. For assistance with access to RIMS, the RIMS helpline can be reached at (202) 208-2222.
Similarly, the “CIPS” link on the FERC Internet website provides access to the texts of formal documents issued by the Commission, such as orders, notices, and rulemakings. From the FERC Internet website, click on the “CIPS” link, select “Docket #” from the CIPS menu, and follow the instructions. For assistance with access to CIPS, the CIPS helpline can be reached at (202) 208-2474.
Take notice that the following filings have been made with the Commission:
Take notice that on October 20, 2000, Illinois Power Company (IP), 500 South 27th Street, Decatur, Illinois 65251-2200, tendered for filing with the Commission Service Agreements for Firm Short-Term Point-To-Point Transmission Service and for Non-Firm Point-To-Point Transmission Service with NRG Power Marketing Inc. (NRG) and with Ameren Energy Marketing Company (Ameren). The Agreements have been entered into pursuant to IP's Open Access Transmission Tariff.
IP requests an effective date of September 25, 2000 for the Agreements with NRG, an effective date of October 2, 2000 for the Agreements with Ameren, and a waiver of the Commission's notice requirement.
IP has served a copy of the filing on NRG and Ameren.
Take notice that on October 20, 2000, Lighthouse Energy Trading Company, Inc., a South Dakota Corporation, (Lighthouse) petitioned the Commission for acceptance of Lighthouse Rate Schedule FERC No. 1; the granting of certain blanket approvals, including the authority to sell electricity at market-
Lighthouse intends to engage in wholesale electric power and energy purchases and sales as a marketer. Lighthouse is not in the business of generating or transmitting electric power.
Take notice that on October 20, 2000, Northrop Grumman Corporation and Grumman Aerospace Corporation tendered for filing Notice of Cancellation of Rate Schedules in the above-referenced proceedings.
Take notice that on October 20, 2000, Montana-Dakota Utilities Co., a division of MDU Resources Group, Inc. (Montana-Dakota), tendered for filing a revised Exhibit H to a certain July 1, 1988 “Contract for Electric Service to Montana-Dakota Utilities Co.”, Contract No. 88-BAO-308, between Montana-Dakota and Western Area Power Administration (Western).
Copies of the filing were served on Western and on the interested utility regulatory agencies.
Take notice that on October 20, 2000, PJM Interconnection, L.L.C. (PJM), on behalf of and at the request of Allegheny Electric Cooperative, Inc. (Allegheny), tendered for filing a revised Schedule 7, Schedule 8, and Attachment H-8 to the PJM Open Access Transmission Tariff.
Copies of this filing were served upon all members of PJM, and the state commissions within the PJM control area.
Take notice that on October 20, 2000, the New York Independent System Operator, Inc. (NYISO), acting pursuant to Section 205 of the Federal Power Act, filed a proposed amendment to the NYISO's Market Administration and Control Area Services Tariff. The proposed amendment would extend the duration of bid caps in certain NYISO-administered markets until April 30, 2001.
The NYISO has requested that the amendment become effective on October 29, 2000.
A copy of this filing was served upon all parties in Docket No. ER00-3038-000, Docket Nos. ER00-3591-000 and ER00-3591-001, Docket Nos. ER97-1523-000, OA97-470-000 and ER97-4324-000, not consolidated, and on all other parties who have executed Service Agreements under the NYISO's Open Access Transmission Tariff or Market Administration and Control Area Services Tariff.
Take notice that on October 20, 2000, the New York Independent System Operator, Inc. (NYISO), acting pursuant to Section 206 of the Federal Power Act at the direction of the NYISO's independent Board of Directors (NYISO Board), tendered for filing a proposed amendment to the NYISO's Market Administration and Control Area Services Tariff. The proposed amendment would extend the duration of bid caps in certain NYISO-administered markets until such time as the NYISO implements a superior market protective mechanism.
A copy of this filing was served upon all parties in Docket No. ER00-3038-000, Docket Nos. ER00-3591-000 and ER00-3591-001, Docket Nos. ER97-1523-000, OA97-470-000 and ER97-4324-000, not consolidated, and on all other parties who have executed Service Agreements under the NYISO's Open Access Transmission Tariff or Market Administration and Control Area Services Tariff.
Take notice that on October 20, 2000 Mexican Business Trust No. 111076-2 (the Trust); Banco Nacional de Me
The Trust states that it is a trust organized under the laws of Mexico, the Trustee, for the purposes of acting as trustee to the Trust only, states that it is a company organized under the laws of Mexico, and TEP states that it is a limited liability company organized under the laws of Me
E. Any person desiring to be heard or to protest such filing should file a motion to intervene or protest with the Federal Energy Regulatory Commission, 888 First Street, N.E., Washington, D.C. 20426, in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 385.214). All such motions or protests should be filed on or before the comment date. Protests will be considered by the Commission in determining the appropriate action to be taken, but will not serve to make protestants parties to the proceeding. Any person wishing to become a party must file a motion to intervene. Copies of these filings are on file with the Commission and are available for public inspection. This filing may also be
Environmental Protection Agency (EPA).
Notice.
In compliance with the Paperwork Reduction Act (44 U.S.C. 3501
Comments must be submitted on or before December 1, 2000.
Send comments, referencing EPA ICR No. 1664.04 and OMB Control No. 2050-0141, to the following addresses: Sandy Farmer, U.S. Environmental Protection Agency, Collection Strategies Division (Mail Code 2822), 1200 Pennsylvania Avenue, NW., Washington, DC 20460; and to Office of Information and Regulatory Affairs, Office of Management and Budget (OMB), Attention: Desk Officer for EPA, 725 17th Street, NW., Washington, DC 20503.
For a copy of the ICR contact Sandy Farmer at EPA by phone at (202) 260-2740, by email at
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations are listed in 40 CFR part 9 and 48 CFR Chapter 15. The
Send comments on the Agency's need for this information, the accuracy of the provided burden estimates, and any suggested methods for minimizing respondent burden, including through the use of automated collection techniques to the addressses listed above. Please refer to EPA ICR No. 1664.04 and OMB Control No. 2050-0141 in any correspondence.
Environmental Protection Agency (EPA).
Notice.
In compliance with the Paperwork Reduction Act (44 U.S.C. 3501
Comments must be submitted on or before January 2, 2001.
Commenters must send an original and two copies of their comments referencing docket number F-2000-IEIP-FFFFF to: (1) If using regular US Postal Service mail: RCRA Docket Information Center, Office of Solid Waste (5305G), U.S. Environmental Protection Agency Headquarters (EPA, HQ), 1200 Pennsylvania Avenue, NW, Washington, DC 20460-0002, or (2) if using special delivery, such as overnight express service: RCRA Docket Information Center (RIC), Crystal Gateway One, 1235 Jefferson Davis Highway, First Floor, Arlington, VA 22202. Comments may also be submitted electronically through the Internet to: rcra-docket@epa.gov. Comments in electronic format should also be identified by the docket number F-2000-IEIP-FFFFF and must be submitted as an ASCII file avoiding the use of special characters and any form of encryption.
Commenters should not submit electronically any confidential business information (CBI). An original and two copies of CBI must be submitted under separate cover to: RCRA CBI Document Control Officer, Office of Solid Waste (5305W), U.S. EPA, 401 M Street, SW, Washington, DC 20460-0002.
Public comments and supporting materials are available for viewing in the RCRA Information Center (RIC), located at Crystal Gateway I, First Floor, 1235 Jefferson Davis Highway, Arlington, VA. The RIC is open from 9 a.m. to 4 p.m., Monday through Friday, excluding federal holidays. To review docket materials, it is recommended that the public make an appointment by calling 703-603-9230. The public may copy a maximum of 100 pages from any regulatory docket at no charge. Additional copies cost $0.15/page.
The ICR is available on the Internet at http://www.epa.gov/epaoswer/hazwaste/exp-imp/icr.htm.
The official record for this action will be kept in paper form. Accordingly, EPA will transfer all comments received electronically into paper form and place them in the official record, which will also include all comments submitted directly in writing. EPA responses to comments, whether the comments are written or electronic, will be in a notice in the
For general information, contact the RCRA Hotline at 800-424-9346 or TDD 800-553-7672 (hearing impaired). In the Washington, DC, metropolitan area, call 703-412-9810 or TDD 703-412-3323. For more detailed information on specific aspects of this rulemaking, contact Patricia Whiting, Office of Solid Waste, 5304W, U.S. Environmental Protection Agency, 401 M Street, SW, Washington, DC 20460-0002, at 703-308-8421, Whiting.Patricia@epamail.gov.
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations are listed in 40 CFR part 9 and 48 CFR Chapter 15. In requesting to continue this information collection, the EPA would like to solicit comments to:
(i) Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
(ii) Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
(iii) Enhance the quality, utility, and clarity of the information to be collected; and
(iv) 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,
The number of export notifications is equal to the number of exporters (816) and the number (and frequency per year) of tracking documents corresponds to the number of annual export and import shipments (25,000 and 2,984, respectively). These estimates take into account all aspects of the information collection, including the time necessary for new entrants to obtain and read the regulations and assess their applicability; time to complete a notification of intent to export; time to complete a tracking document and to transmit copies of the tracking document. Burden means the total time, effort, or financial resources expended by persons to generate, maintain, retain, or disclose or provide information to or for a Federal agency. This includes the time needed to review instructions; develop, acquire, install, and utilize
Environmental Protection Agency (EPA).
Notice.
In compliance with the Paperwork Reduction Act (44 U.S.C. 3501
Additional comments may be submitted on or before December 1, 2000.
Send comments, referencing EPA ICR No. 1250.06 and OMB Control No. 2070-0075, to the following addresses: (1) Sandy Farmer, U.S. Environmental Protection Agency, Collection Strategies Division (Mail Code: 2822), 1200 Pennsylvania Avenue, NW., Washington, DC 20460; and to: (2) Office of Information and Regulatory Affairs, Office of Management and Budget (OMB), Attention: Desk Officer for EPA, 725 17th Street, NW, Washington, DC 20503.
Sandy Farmer at EPA phone on 202-260-2740, by e-mail at:
Responses to the collection of information are voluntary, but failure to provide the requested information will prevent a contractor employee from obtaining clearance to TSCA CBI. EPA will observe strict confidentiality precautions with respect to the information collected on individual employees, based on the Privacy Act of 1974, as outlined in the ICR and in the collection instrument.
An Agency may not conduct or sponsor, and a person is not required to respond to a collection of information that is subject to approval under the Paperwork Reduction Act, unless it displays a currently valid OMB control number. The OMB control numbers for EPA's information collections appear as part of the collection instruments (
The ICR provides a detailed explanation of the burden and cost estimates for this ICR, which are only briefly summarized here:
According to the procedures prescribed in 5 CFR 1320.12, EPA has submitted this ICR to OMB for review and approval. Any comments related to
Environmental Protection Agency (EPA).
Notices.
This document announces the Office of Management and Budget's (OMB) responses to Agency clearance requests, in compliance with the Paperwork Reduction Act (44 U.S.C. 3501
Sandy Farmer at 260-2740, or email at
EPA ICR No. 1381.06; Recordkeeping and Reporting Requirements for Solid Waste Disposal Facilities and Practices; in 40 CFR part 258; was approved 08/28/2000; OMB No. 2050-0122; expires 08/31/2003.
EPA ICR No. 1630.06; Amendment of the Oil Pollution Act Facility Response Plan requirements; in 40 CFR part 112; was approved 08/11/2000; OMB No. 2050-0135; expires 08/31/2003.
EPA ICR No. 1712.03; NESHAP for Shipbuilding and Ship Repair Facilities (Surface Coating); in 40 CFR part 63, subpart II; was approved 08/04/2000; OMB No. 2060-0330; expires 08/31/2003.
EPA ICR No. 0877.07; Environmental Radiation Ambient Monitoring System (ERAMS); was approved 08/02/2000; OMB No. 2060-0015; expires 08/31/2003.
EPA ICR No. 1695.06; Non-Road Spark-Ignition Engines At or Below 19 Kilowatts for Emission Certification and the Averaging, Banking, and Trading Program; in 40 CFR part 90, subpart C; was approved 08/03/2000; OMB No. 2060-0338; expires 11/30/2000.
EPA ICR No. 1939.01; Resource Conservation and Recovery Act (RCRA) Corrective Action Information Request; was approved 08/02/2000; OMB No. 2050-0170; expires 02/28/2002.
EPA ICR No. 1249.06; Recordkeeping for Certified Applicators Using 1080 Collars for Livestock Protection; was approved 09/05/2000; OMB No. 2070-0074; expires 09/30/2003.
EPA ICR No. 0276.11; Application for Experimental Use Permit (EUP) to Ship and Use a Pesticide for Experimental Purposes Only; in 40 CFR part 172; was approved 09/05/2000; OMB No. 2070-0040; expires 09/30/2003.
EPA ICR No. 1353.06; Land Disposal Restrictions No-Migration Variance; in 40 CFR 268.6; was approved 09/08/2000; OMB No. 2050-0062; expires 09/30/2003.
EPA ICR No. 1917.01; Indoor Air Quality Practices in Large Buildings Survey; was approved 09/08/2000; OMB No. 2060-0436; expires 09/30/2003.
EPA ICR No. 0229.13; Standards for the Use or Disposal of Sewage Sludge; in 40 CFR parts 122-125 and 503; was approved 09/21/2000; OMB No. 2040-0004; expires 09/30/2001.
EPA ICR No. 1722.02; Control of Air Pollution, Emission Standards for New Gasoline Spark-Ignition Marine Engines; in 40 CFR part 91, subpart B, C, D, and E; OMB No. 2060-0321; on 07/31/2000 OMB extended the expiration date through 12/31/2000.
EPA ICR No. 1761.02; Regulations for a Voluntary Emissions Standards Program Applicable to Manufactures of Light-Duty Vehicles and Trucks Beginning in Model Year 1977; OMB No. 2060-0345; on 07/31/2000 OMB extended the expiration date through 01/31/2001.
EPA ICR No. 0010.08; Importation Requirements for Importation of Nonconforming Vehicles; in 40 CFR part 85 and 40 CFR part 89; OMB No. 2060-0095; on 08/04/2000 OMB extended the expiration date through 11/30/2000.
EPA ICR No. 1673.02; Reporting and Recordkeeping Requirements for Importation of Nonconforming Non-road Small Spark Ignition Engines; in 40 CFR part 85, subparts P and R and 40 CFR parts 89 and 90; OMB No. 2060-0294; on 08/04/2000 OMB extended the expiration date through 11/30/2000.
EPA ICR No. 1683.02; NSPS for Primary Aluminum Reduction Plants, Recordkeeping and Reporting; in 40 CFR 60.192, 60.194, and 60.195; OMB No. 2060-0031; on 08/10/2000 OMB extended the expiration date through 11/30/2000.
EPA ICR No. 1604.05; NSPS for Secondary Brass and Brass and Bronze Production Plants, Recordkeeping and Reporting; in 40 CFR 60.133, 60.166, 60.176, 60.186, 60.195, and 60.266; OMB No. 2060-0110; on 08/10/2000 OMB extended the expiration date through 11/30/2000.
EPA ICR No. 1049.08; Notification of Episodic Releases of Oil and Hazardous Substances; in 40 CFR parts 110, 117, and 302; OMB No. 2050-0046; on 08/15/2000 OMB extended the expiration date through 02/28/2001.
EPA ICR No. 1664.03; National Oil and Hazardous Substances Pollution Contingency Plan; in 40 CFR part 300, subpart J; on 08/15/2000 OMB extended the expiration date through 11/30/2000.
EPA ICR No. 1135.06; NSPS for Magnetic Tape Coating Facilities; in 40 CFR part 60, subpart SSS; OMB No. 2060-0171; on 08/16/2000 OMB extended the expiration date through 11/30/2000.
EPA ICR No. 1816.01; State Source Water Assessment and Protection Programs; OMB No. 2040-0197; on 08/21/2000 OMB extended the expiration date through 12/31/2000.
EPA ICR No. 0184.05; Vehicle Emission Control Defect Survey Questionnaire; OMB No. 2060-0047; on 08/28/2000 OMB extended the expiration date through 11/30/2000.
EPA ICR No. 0282.10; Emission Defect Information and Voluntary Emission Recall Report; in 40 CFR 90.800, 90.802, and 90.804; OMB No. 2060-0048; on 08/31/2000 OMB extended the expiration date through 12/31/2000.
EPA ICR No. 0116.05; Emission Control System Performance Warranty Regulations and Voluntary Aftermarket Part Certification Program; in 40 CFR part 85, subpart V; OMB No. 2060-0060; on 08/31/2000 OMB extended the expiration date through 11/30/2000.
EPA ICR No. 1797.01; NSPS for Petroleum Storage Liquid Vessels; in 40 CFR part 60, subpart K; OMB No. 2060-0009; on 08/31/2000 OMB extended the expiration date through 11/30/2000.
EPA ICR No. 1427.05; National Pollutant Discharge Elimination System (NPDES); in 40 CFR parts 122, 123, 124, and 125; OMB No. 2040-0110; on 09/11/2000 OMB extended the expiration date through 11/30/2000.
EPA ICR No. 1000.06; Polychlorinated Biphenyls (PCBs) Used in Electrical Equipment; OMB No. 2070-0003; on 09/11/2000 OMB extended the expiration date through 03/31/2001.
EPA ICR No. 0994.06; Beach Closing Survey Report on the Great Lakes; OMB No. 2090-0003, on 09/11/2000 OMB extended the expiration date through 03/31/2001.
EPA ICR No. 1810.01; Obtaining Unbilled Grant Expenses from Grant Recipients at Year-End; OMB No. 2030-0037; on 09/14/2000 OMB extended the expiration date through 03/31/2001.
EPA ICR No. 0234.06; Performance Evaluation Studies on Water and Wastewater Laboratories; OMB No. 2080-0021; on 09/15/2000 OMB extended the expiration date through 12/31/2000.
EPA ICR No. 1680.02; Combined sewer Overflow Policy; OMB No. 2040-0170; on 09/15/2000 OMB extended the expiration date through 12/31/2000.
EPA ICR No. 1230.09; Prevention of Significant Deterioration Non-Attainment Area New Source Review; in 40 CFR parts 51 and 52; OMB No. 2060-0003; on 09/21/2000 OMB extended the expiration date through 03/31/2001.
EPA ICR No.1948.01; National Primary Drinking Water Regulations: Arsenic and Clarifications to Compliance and New Source Contaminants Monitoring; in 40 CFR 141.23; on 09/20/2000 OMB filed comment.
EPA ICR No. 1973.01; Cooling Water Intake Structures New Facility (Proposed Rule); in 40 CFR 122.2, 122.29(b), 40 CFR 125.83 and 125.81; on 09/20/2000 OMB filed comment.
EPA ICR No. 1928.01; Proposed Long Term 1 Enhanced Surface Water Treatment and Filter Backwash Rule (LT1FBR); in 40 CFR part 141, subparts C, D, and H, 40 CFR part 142, subpart B; on 09/21/2000 OMB filed comment.
EPA ICR No. 1944.01; Baseline Standards and Best Management Practices for the Coal Mining Point Category—Coal Remining Subcategory and Western Alkaline Coal Mining Subcategory; in 40 CFR part 434; on 09/21/2000 OMB filed comment.
EPA ICR No. 1934.01; Proposed Ground Water Rule; in section 1412(b); on 09/21/2000 OMB filed comment.
EPA ICR No. 0370.17; Proposed Revision of Federal UIC Requirements for Class 1 Municipal Wells in Florida; in 40 CFR parts 144 and 146; OMB No. 2040-0042; on 09/21/2000 OMB filed comment.
EPA ICR No. 1953.01; Best Management Practices Alternatives, Effluent Limitations Guidelines and Standards, Oil and Gas Extraction Point Source Category; in 40 CFR part 435; on 09/21/2000 OMB filed comment.
EPA ICR No. 1909.01; Assess Compliance with EPCRA Section 312 Reporting Requirements; on 08/23/2000 EPA withdrew this collection from OMB review.
EPA ICR No. 1619.04; EPA Indoor Environmental Quality Questionnaire; OMB No. 2060-0244; on 09/08/2000 EPA withdrew this collection from OMB review.
EPA ICR No. 1064.09, NSPS for Automobile and Light Duty Truck Surface Coating Operations; in 40 CFR part 63, subpart MM; OMB No. 2060-0034; on 09/22/2000 EPA withdrew this collection from OMB review.
EPA ICR No. 1773.02; New and Amended Reporting and Recordkeeping Requirements for NESHAP from Hazardous Waste Combustors; in 40 CFR part 63, subpart EEE; on 08/04/2000 OMB No. 2060-0349; (Air and Radiation); was transferred to OMB No. 2050-0171 (Solid Waste and Emergency Response).
EPA ICR No. 1797.01; NSPS for Petroleum Storage Liquid Vessels; in 40 CFR part 60, subpart K; OMB No. 2020-0009; (Office of Enforcement and Compliance Assurance); was transferred to OMB No. 2060-0442; (Office of Air and Radiation).
EPA ICR No. 1630.06; Amendment of the Oil Pollution Act Facility Response Plan; in 40 CFR part 112; OMB No. 2050-0135; on 08/15/2000 OMB changed the expiration date from 08/31/2003 to 12/31/2000.
Environmental Protection Agency (EPA).
Notice.
In compliance with the Paperwork Reduction Act (44 U.S.C. 3501
Comments must be submitted on or before December 1, 2000.
Send comments, referencing EPA ICR No. 1630.07 and OMB Control Number 2050-0135, to the following addresses: Sandy Farmer, U.S. Environmental Protection Agency, Collection Strategies Division (Mail Code 2822), 1200 Pennsylvania Avenue, NW, Washington, DC 20460; and to Office of Information and Regulatory Office of Management and Budget (OMB), Attention: Desk Officer for EPA, 725 17th Street, NW, Washington, DC 20503.
For a copy of the ICR contact Sandy Farmer at EPA by phone at (202) 260-2740, by E-mail at farmer.sandy@epamail.epa.gov, or download off the Internet at http://www.epa.gov/icr and refer to EPA ICR No. 1630.07. For technical questions about the ICR contact Barbara Davis on 703-603-8823.
All facility response plan (FRP) reporting and recordkeeping activities are mandatory. Each FRP is submitted to EPA. The Agency, in turn, reviews and approves plans from facilities identified as having the potential to cause “significant and substantial harm” to the environment for oil discharges. Other low risk, regulated facilities that are not required to prepare facility response plans are required to document their determination that they do not meet the “substantial harm” criteria.
None of the information to be gathered for this collection is believed to be confidential. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations are listed in 40 CFR part 9 and 48 CFR Chapter 15. The
Send comments on the Agency's need for this information, the accuracy of the provided burden estimates, and any suggested methods for minimizing respondent burden, including through the use of automated collection techniques to the addresses listed above. Please refer to EPA ICR No. 1630.07 and OMB Control No. 2050-0135 in any correspondence.
Environmental Protection Agency (EPA).
Notice of submission to OMB.
In compliance with the Paperwork Reduction Act (44 U.S.C. 3501
Additional comments may be submitted on or before December 1, 2000.
Sandy Farmer at EPA by phone on (202) 260-2740, by e-mail: “farmer.sandy@epa.gov,” or download off the Internet at http://www.epa.gov/icr/icr.htm and refer to EPA ICR No. 1704.05.
Send comments, referencing EPA ICR No. 1704.05 and OMB Control No. 2070-0143, to the following addresses: Ms. Sandy Farmer, Office of Environmental Information (2822), U.S. Environmental Protection Agency, 1200 Pennsylvania Ave., NW, Washington, DC 20460; and to Office of Information and Regulatory Affairs, Office of Management and Budget (OMB), Attention: Desk Officer for EPA, 725 17th Street, NW, Washington, DC 20503.
In accordance with the authority in EPCRA, EPA has established an alternate threshold for those facilities with low amounts of a listed toxic chemical in wastes. A facility that meets the current reporting thresholds but estimates that the total amount of the chemical in total waste does not exceed 500 pounds per year, and that the chemical was manufactured, processed, or otherwise used in an amount not exceeding 1 million pounds during the reporting year, can take advantage of reporting under the alternate threshold option for that chemical for that reporting year.
Each qualifying facility that chooses to apply the revised threshold must file the Form A (EPA Form 9350-2) in lieu of a complete TRI reporting Form R (EPA Form 9350-1). In submitting the Form A, the facility certifies that the sum of the amount of the EPCRA section 313 chemical in wastes did not exceed 500 pounds for the reporting year, and that the chemical was manufactured, processed, or otherwise used in an
The primary function served by the submission of the Form A is to satisfy the statutory requirement to maintain reporting on a substantial majority of releases for all listed chemicals. Without the Form A, users of TRI data would not have access to any information on these chemicals. The Form A also serves as a
EPA estimates that as many as 7,397 respondents may submit a Form A with these responses containing a total of 14,793 certifications. Total respondent burden and cost for completing those Form As are estimated at approximately 582,000 burden hours and $52 million per year. (The alternate threshold may save reporting facilities up to 189,000 hours, with a dollar value of $11 million, compared to the cost of reporting on Form R.) The estimated burden in this supporting statement differs from what is currently in OMB's inventory for alternate threshold reporting (13,157 respondents, 9,072 responses, and 646,875 burden hours) as a result of both an adjustment and a program change. The adjustment was made by calculating the number of eligible respondents and responses from the manufacturing sector based on TRI data from the 1998 reporting year (the most recent TRI data available). This adjustment reduced reporting burden by 62,772 hours. The program change was made by excluding the reporting of PBT chemicals on Form A. This change reduces the burden associated with this collection. The portion of the change due to this regulatory change decreases burden by 2,114 hrs.
Environmental Protection Agency (EPA).
Notice.
In compliance with the Paperwork Reduction Act (44 U.S.C. 3501
Comments must be submitted on or before December 1, 2000.
Send comments, referencing EPA ICR No. 1135.07 and OMB Control No. 2060-0171, to the following addresses: Sandy Farmer, U.S. Environmental Protection Agency, Collection Strategies Division (Mail Code 2822), 1200 Pennsylvania Avenue, NW, Washington, DC 20460; and to Office of Information and Regulatory Affairs, Office of Management and Budget (OMB), Attention: Desk Officer for EPA, 725 17th Street, NW, Washington, DC 20503
For a copy of the ICR contact Sandy Farmer at EPA by phone at (202) 260-2740, by E-Mail at Farmer.Sandy@epamail.epa.gov or download off the Internet at
Owners or operators of the affected facilities described must make the following one time-only reports: notification of the date of construction or reconstruction; notification of the anticipated and actual dates of startup; notification of any physical or operational change to an existing facility which may increase the regulated pollutant emission rate; notification of the date of the initial performance test (not required under section 60.393(a)); and the results of the initial performance test.
Owners or operators also are required to maintain records of the occurrence and duration of any startup, shutdown, or malfunction in the operation of an affected facility. These notifications, reports and records are required, in general, of all sources subject to NSPS.
Monitoring requirements specific to these magnetic tape operations consist mainly of VOC measurements, including monthly records of VOC content of all coatings applied, total amount and percent VOC recovered, and the total amount of coating applied. In addition, facilities utilizing less solvent annually than the applicable
Each owner or operator of an affected magnetic tape coating operation shall install, calibrate, maintain, and operate a monitoring device that continuously indicates and records the concentration level of organic compounds in the outlet gas stream. Certain facilities will also be required to continuously measure and record either the combustion temperature of the incinerator (for those facilities controlled by a thermal incinerator) or the condenser exhaust temperature (for those facilities controlled by a condensation system).
Owners or operators of the affected facilities described must make the following one-time-only reports: notification of the date of construction or reconstruction; notification of the anticipated and actual dates of startup; notification of any physical or operational change to an existing facility which may increase the regulated pollutant emission rate; notification of demonstration of the continuous monitoring system (CMS); notification of the date of the initial performance test; and the results of the initial performance test.
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations are listed in 40 CFR part 9 and 48 CFR Chapter 15. The
Send comments on the Agency's need for this information, the accuracy of the provided burden estimates, and any suggested methods for minimizing respondent burden, including through the use of automated collection techniques to the following addresses. Please refer to EPA ICR No. 1135.07 and OMB Control No. 2060-0171 in any correspondence.
Environmental Protection Agency (EPA).
Notice.
Through this notice, the Environmental Protection Agency (EPA) is requesting applications for consideration at the Thirteenth Meeting of the Parties to the
Applications for essential use exemptions must be submitted to EPA no later than December 1, 2000 in order for the United States (U.S.) government to complete its review and to submit nominations to the United Nations Environment Programme (UNEP) and the Protocol Parties in a timely manner.
Send two copies of application materials to: Erin Birgfeld, Stratospheric Protection Division (6205J), Environmental Protection Agency, 1200 Pennsylvania Avenue, NW, Washington, DC 20460. If submitting applications by courier, the office address is 501 3rd Street, NW, Washington, DC 20001. Send one copy of your application materials to: Air Docket A-93-39, 401 M Street, SW, (6102), Room M1500, Washington, DC 20460.
Erin Birgfeld at the above address or at (202) 564-9079 telephone, (202) 565-2095 fax, or
As described in previous
Decision IV/25 states that “* * * a use of a controlled substance should qualify as “essential” only if: (i) It is necessary for the health, safety or is critical for the functioning of society (encompassing cultural and intellectual aspects); and (ii) there are no available technically and economically feasible alternatives or substitutes that are acceptable from the standpoint of environment and health”. In addition, the Parties agreed “that production and consumption, if any, of a controlled substance, for essential uses should be permitted only if: (i) All economically feasible steps have been taken to minimize the essential use and any associated emission of the controlled substance; and (ii) the controlled substance is not available in sufficient quantity and quality from the existing stocks of banked or recycled controlled substances. * * *”
Applicants should be aware that essential use exemptions granted to the U.S. for the year 2001 under the Protocol were limited to chlorofluorocarbons (CFCs) for metered dose inhalers (MDIs) to treat asthma and chronic obstructive pulmonary disease, and methyl chloroform for use in manufacturing solid rocket motors.
The first step in obtaining essential use allowances is for the user to consider whether the use of the controlled substance meets the Decision IV/25 criteria. The user should then notify EPA of the candidate use and provide information for U.S. government agencies and the Protocol Parties to evaluate that use according to the criteria under Decision IV/25. Upon receipt of the essential use exemption application, EPA reviews the information provided and works with other interested Federal agencies to determine whether it meets the essential use criteria and warrants being nominated by the United States for an exemption. In the case of multiple exemption requests for a single use such as for MDIs, EPA aggregates exemption requests received from individual entities into a single U.S. request. An important part of the EPA review of requests for CFCs for MDIs is to determine that the aggregate request for a particular future year adequately reflects the total market need for CFC MDIs and expected availability of CFC substitutes by that point in time. If the sum of individual requests does not account for such factors, the U.S. government may adjust the aggregate request to better reflect true market needs.
Nominations submitted to the Ozone Secretariat by the U.S. and other Parties are forwarded to the UNEP Technical and Economic Assessment Panel (TEAP) and its Technical Options Committees (TOCs), which review the submissions and make recommendations to the Parties for essential use exemptions. Those recommendations are then considered by the Parties at their annual meeting for final decision. If the Parties declare a specified use of a controlled substance as essential and issue the necessary exemption from the production and consumption phaseout, EPA may propose regulatory changes to reflect the decisions by the Parties, but only to the extent such action is consistent with the Clean Air Act (CAA or Act).
The timing of this process is such that in any given year the Parties review nominations for essential use exemptions from the production and consumption phaseout intended for the following year and subsequent years. This means that, if nominated, applications submitted in response to today's notice for an exemption in 2002 and 2003 will be considered by the Parties in 2001 for final action.
The quantities of controlled ODSs that are requested in response to this notice, if approved by the Parties to the Montreal Protocol in 2001, will then be allocated as essential-use allowances (EUAs) to the specific U.S. companies through notice and comment rulemaking. EUAs for the year 2002 will be allocated to U.S. companies at the end of 2001, and EUAs for the year 2003 will be made at the end of 2002.
Each year the Parties to the Protocol have approved an unlimited, global essential use exemption for the production and consumption of high purity class I ODSs for laboratory and analytical uses. Prior to the year 2000, EPA implemented this exemption domestically through regulation. As discussed in last year's notice requesting applications for essential use allowances (64 FR 50083), in the year 2000 and beyond, the Clean Air Act does not specifically list an exemption for laboratory and analytical uses of class I ODSs. EPA is issuing a separate rulemaking later in the year which will clarify this issue further. Until then, current stocks of class I ODSs that are already in the U.S. can continue to be sold for laboratory and analytical uses.
Through this notice, EPA requests applications for essential use exemptions for all Class I substances, except methyl bromide, for 2002 and 2003. This is the last opportunity to submit applications for 2002. Companies will have an opportunity to submit supplemental or amended applications for 2003 next year. All requests for exemptions submitted to EPA must present information as prescribed in the TEAP “Handbook on Essential Use Nominations” (Handbook) as last published in 1997. You can request a Handbook from the Stratospheric Protection Hotline at (301) 614-3990 or (800) 296-1996. It is also available electronically on the web at
• Role of use in society
• Alternatives to use, including education programs on alternatives
• Steps to minimize use, including development of CFC-free alternatives
• Steps to minimize emissions
• Amount of substance available through recycling and stockpiling
• Quantity of controlled substances requested by year.
In order to gain more complete information from essential use applicants for CFC MDIs, EPA is requesting more detailed information in the EUA applications. First, we ask that in the case of EUA applications requesting CFCs for multiple pharmaceutical companies (
Third, we request that all New Drug Application holders (NDA holders or sponsors) be engaged in the essential use application process for the year 2003 and beyond. We know of sponsor companies whose CFC MDI is produced by another company (the contract filler). In the past, EPA has accepted essential use applications submitted by the contract filler, in the absence sufficient information on the NDA holder's reformulation efforts. Therefore, EPA is
Since the U.S. government can not forward incomplete or inadequate nominations to the Ozone Secretariat, it is important for applicants to provide all information requested in the Handbook, including the information specified in the supplemental research and development form (page 43). The accounting framework matrix in the Handbook titled “Table IV: Reporting Accounting Framework for Essential Uses Other Than Laboratory and Analytical” requests data for the year 2000 on the amount of ODS exempted for an essential use, the amount acquired by production, the amount acquired by import, the amount on hand at the start of the year, the amount available for use in 2000, the amount used for the essential use, the quantity contained in exported products, the amount destroyed, and the amount on hand at the end of the year. Because the data necessary to complete Table IV will not be available until after January 1, 2001, companies should not include this chart with their EUA applications in response to this notice. EPA plans to send letters to each essential use applicant requesting the information in Table IV in the first 2 weeks of January 2001. Companies will have only fourteen days in which to respond since EPA must compile companies' responses to complete the U.S. CFC Accounting Framework for submission to the Parties to the Montreal Protocol by the end of January.
EPA anticipates that the 2001 review by the Parties of MDI essential use requests will focus extensively on research efforts underway to develop alternatives to CFC MDIs, on education programs to inform patients and health care providers of the CFC phaseout and the transition to alternatives, and on steps taken to minimize CFC use and emissions including efforts to recapture or reprocess the controlled substance. Accordingly, applicants are strongly advised to present detailed information on these points, including the scope and cost of such efforts and the medical and patient organizations involved in the work. Applicants can strengthen their exemption requests by submitting a complete set of education materials, including copies of printed, electronic or audio-visual tools. Applicants are given notice that exemption requests without adequate information on research and education will not be considered complete.
Applicants should submit their exemption requests to EPA as noted in the
Environmental Protection Agency (EPA).
Notice of teleconference.
Pursuant to the Federal Advisory Committee Act, Public Law 92-463, as amended (5 U.S.C., App. 2) notification is hereby given that the Environmental Protection Agency, Office of Research and Development (ORD), The Board of Scientific Counselors (BOSC), will hold its Executive Committee Meeting.
The Teleconference will be held on November 16, 2000.
On Thursday, November 16, 2000, the teleconference will begin at 10 a.m. and will adjourn at 12 Noon. The call in number is 202-260-7280, access code: 1774#. All times noted are Eastern Time.
The Agenda of the BOSC Executive Committee will cover:
• Discussion and approval of the BOSC report on the Management of PM Research in ORD,
• Committee Assignments,
• Multi-year Planning.
The teleconference is open to the public. Any member of the public wishing to make a presentation at the meeting should contact Shirley Hamilton, Designated Federal Officer, Office of Research and Development (8701R), 1200 Pennsylvania Avenue, NW., Washington, DC 20460; telephone at (202) 564-6853. In general each individual making an oral presentation will be limited to a total of three minutes.
Shirley R. Hamilton, Designated Federal Officer, U.S. Environmental Protection Agency, Office of Research and Development, NCER (MC 8701R), 1200 Pennsylvania Avenue, NW., Washington, DC 20460, (202) 564-6853.
Environmental Protection Agency (EPA).
Notice of meeting.
This notice announces a conference call meeting of the Inert Disclosure Stakeholder Workgroup. The workgroup was established to advise the Pesticide Program Dialogue Committee on ways of making information on inert ingredients more available to the public while working within the mandates of the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) and related Confidential Business Information concerns.
The meeting will be held by conference call on Wednesday, November 8, 2000 from 3:00 pm to 6:00 pm EST.
Members of the public may listen to the meeting discussions on site at: Crystal Mall #2 (CM #2), 1921 Jefferson Davis Highway, Arlington, VA; conference Room 1123. Seating is limited and will be available on a first come first serve basis.
By mail: Cameo Smoot, Office of Pesticide Programs (7506C), U.S. Environmental Protection Agency, 1200 Pennsylvania Avenue, NW., Washington, DC 20460, telephone: (703) 305-5454. Office locations: 11th floor, CM #2, 1921 Jefferson Davis Highway, Arlington, VA. E-mail smoot.cameo@epa.gov.
The Inert Disclosure Stakeholder Workgroup is composed of a participants from the following sectors: environmental/public interest and consumer groups; industry and pesticide users; Federal, State and local governments; the general public; academia and public health organizations.
The Inert Disclosure Stakeholder Workgroup, will advise the EPA through the Pesticide Program Dialogue Committee (PPDC), on potential measures to increase the availability to the public of information about inert ingredients (also called “other ingredients”) under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA). Among the factors the workgroup has been asked to consider in preparing its recommendations are: existing law regarding inert ingredients and Confidential Business Information (CBI); current Agency processes and policies for disseminating inert ingredient information to the public, including procedures for the protection of CBI; informational needs for a variety of stakeholders; and business reasons for limiting the disclosure of inert ingredient information.
The Inert Disclosure Stakeholder Workgroup meeting is open to the public. Written public statements are welcome and should be submitted to the OPP administrative docket OPP-00439A. Any person who wishes to file a written statement can do so before or after the conference call. These statements will become part of the permanent file and will be provided to the Workgroup members for their information.
You may submit comments through the mail, in person, or electronically. To ensure proper receipt by EPA, it is imperative that you identify docket control number OPP-00439A in the subject line on the first page of your response.
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Environmental protection, Pesticides, Inerts, PPDC.
Environmental Protection Agency (EPA).
Notice.
EPA has developed a draft National Action Plan to address the remaining risks to the Level 1 priority Persistent, Bioaccumulative, and Toxic (PBT) pesticide pollutants. This proposed National Action Plan covers the chemical compounds: Aldrin, Dieldrin, Chlordane, DDT, Mirex and Toxaphene. These six pesticides are highly chlorinated, persistent organic pesticides that were once widely used in large quantities in the United States. Because of evidence supporting the adverse environmental and human health effects of these substance, including their probable carcinogenicity, the pesticide use of all of the Level 1 pesticides were canceled in the U.S. in the 1970's and 80's. Current data substantiate that these Level 1 pesticides are still ubiquitous in the environment, and at concentrations that may be of concern for both humans and wildlife. This plan, developed pursuant to the Agency 's Multimedia Strategy for Priority PBT Pollutants, addresses the remaining risks. This Notice announces the availability of the proposed Pesticide national Action for public review and comment.
Comments, identified by docket control number OPPTS -00299, must be received on or before December 1, 2000.
Comments may be submitted by mail, electronically, or in person. Please follow the detailed instructions for each method as provided in Unit I. of the
For general information contact: Barbara Cunningham, Director, Office of Program Management and Evaluation, Office of Pollution Prevention and Toxics (7401), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460; telephone number: (202) 554-1404; e-mail address: TSCA-Hotline @epa.gov. For technical information contact: Paul Matthai, Pollution Prevention Division Mail Code 7409, Office of Pollution Prevention and Toxics, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460; telephone number: 202 260-3385; e-mail address:matthai.paul@epa.gov.
This action is directed to the public in general. This action may, however, be of interest to persons who have unused stocks of these canceled pesticide, such as farmers, or who live or work near contaminated reservoirs such as sediments, soil and localized contaminated industrial and pesticide dealership sites. Since other entities may also be interested, the Agency has not attempted to describe all the specific entities that may be affected by this action. If you have any questions regarding the applicability of this action to a particular entity, consult the technical person listed in the
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You may submit comments through the mail, in person, or electronically. To ensure proper receipt by EPA, it is imperative that you identify docket control number OPPTS -00299 in the subject line on the first page of your response.
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Do not submit any information electronically that you consider to be CBI. You may claim information that you submit to EPA in response to this document as CBI by marking any part or all of that information as CBI. Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2. In addition to one complete version of the comment that includes any information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public version of the official record. Information not marked confidential will be included in the public version of the official record without prior notice. If you have any questions about CBI or the procedures for claiming CBI, please consult the technical person identified under
We invite you to provide your views on the various options we propose, new approaches we have not considered, the potential impacts of the various options (including possible unintended consequences), and any data or information that you would like the Agency to consider during the development of the final action. You may find the following suggestions helpful for preparing your comments:
1. Explain your views as clearly as possible.
2. Describe any assumptions that you used.
3. Provide copies of any technical information and/or data you used that support your views.
4. If you estimate potential burden or costs, explain how you arrived at the estimate that you provide.
5. Provide specific examples to illustrate your concerns.
6. Offer alternative ways to improve the rule or collection activity.
7. Make sure to submit your comments by the deadline in this notice.
8. To ensure proper receipt by EPA, be sure to identify the docket control number assigned to this action in the subject line on the first page of your response. You may also provide the name, date, and Federal Register citation.
On November 16, 1998, EPA released its draft Agency-wide Multimedia Strategy for Priority Persistent, Bioaccumulative, and Toxic (PBT) Polutants (PBT Strategy). The goal of the PBT Strategy is to identify and reduce risks to human health and the environment from current and future exposures to priority PBT pollutants. This document serves as the Draft National Action Plan for the Level 1 pesticides; six of the 12 Level 1 priority PBT pollutants identified for the initial focus of action in the PBT Strategy.
Aldrin, dieldrin, chlordane, DDT, mirex, and toxaphene were once widely used in large quantities in the United States for applications, including: insect control on agricultural crops and cotton, treatment of livestock, control of ants, termite control in houses, and control of insect carriers of human diseases such as malaria. Because of evidence supporting the adverse environmental and human health effects of these substances, including their probable carcinogenicity, the pesticide uses of all of the Level 1 pesticides were canceled in the U.S. in the 1970's and 80's. In general, the remaining sources of Level 1 pesticides in the United States include: unused stocks of these canceled pesticides; contaminated reservoirs such as sediments, soil, and localized contaminated industrial and dealership sites; atmospheric transport and deposition (from both regional and international sources); and DDT present as an impurity (<0.1%) in Dicofol, a pesticide currently used in the U.S. and Canada.
Human exposure occurs mainly through the food chain and for the most exposed populations, is probably due to the consumption of contaminated fish. Potential risk and health consequences due to the Level 1 pesticides are of particular concern for certain human populations who have increased exposure (e.g., subsistence fishers) and/or increased susceptibility (e.g., the developing embryo/fetus, nursing infants, and children).
Data gathered in current multimedia monitoring efforts provided substantial evidence that the Level 1 pesticides are still ubiquitous in the environment, and at concentrations that may be of concern for both humans and wildlife. There are also significant quantities of unused, obsolete pesticide stocks stored throughout the U.S. and overseas which have the potential to cause serious
EPA considers stakeholder involvement essential to reaching the goals of the PBT Strategy. EPA is seeking stakeholder input and invites comment on this draft National Action Plan on the following topics and issues related to the PBT Level 1 pesticides:
1. Quantities of domestic unused stocks of pesticide products.
2. Historical trends or current soil residues (urban and agricultural).
3. Information on sites with significant Level 1 pesticide contamination.
4. Current indoor levels of pesticides used in residents.
5. Alternative disposal and soil/sediment remediation methods, and performance information.
6. Other sensitive or highly exposed human subpopulations.
7. Meaningful and feasible ways to address the problem of canceled pesticides in the environment.
8. Meaningful PBT goals, performance measures, and time frames for such accomplishments.
Environmental protection.
Federal Election Commission.
General Public Political Communications Coordinated with Candidates and Independent Expenditures: Draft Final Rules with Explanation and Justification.
Administrative Matters.
The Commission hereby gives notice of the filing of the following agreement(s) under the Shipping Act of 1984. Interested parties can review or obtain copies of agreements at the Washington, DC offices of the Commission, 800 North Capitol Street, N.W., Room 940. Interested parties may submit comments on an agreement to the Secretary, Federal Maritime Commission, Washington, DC 20573, within 10 days of the date this notice appears in the
By Order of the Federal Maritime Commission.
Notice is given of the termination of all certificates issued by the Federal Maritime Commission to Premier Operations Ltd. (d/b/a Premier Cruises and Premier Cruise Lines) (“Premier”) pursuant to sections 2 and 3 of Public Law 89-777, 46 U.S.C. app. Sections 817d and e. Premier has ceased operations, and bankruptcy proceedings have been initiated in the Supreme Court of Bermuda to liquidate Premier. In addition, the Commission has been notified of the termination of coverage provided to Premier under various financial instruments. That coverage, in the form of a surety bond for performance and guaranties for casualty, provided the necessary evidence of financial responsibility for issuing Commission certificates to Premier. Accordingly, all casualty and performance certificates as specified below have, or soon will, become null and void.
Premier currently holds Certificates (Casualty) and Certificates (Performance) for vessels as identified below.
Guarantors who provided evidence of financial responsibility supporting the above listed casualty certificates notified the Commission on September 14, 2000, and September 18, 2000, that the guaranties would be terminated on October 14, 2000, and October 18, 2000,
All of the performance certificates are supported by a surety bond issued by Greenwich Insurance Company and NAC Reinsurance Corporation in the amount of $15 million. On September 26, 2000, the surety notified the Commission of the cancellation of the surety bond effective October 26, 2000. Since Premier has ceased operations and is in the process of being liquidated, the above identified performance certificates shall become null and void effective October 26, 2000, pursuant to 46 CFR 540.8(a).
This notice is issued under the authority of 46 CFR 501.27(h)(5).
The Federal Maritime Commission hereby gives notice that the following ocean transportation intermediary licenses have been terminated pursuant to section 19 of the Shipping Act of 1984 (46 U.S.C. app. 1718) and the regulations of the Commission pertaining to the licensing of Ocean Transportation Intermediaries, effective on the corresponding dates shown below:
Notice is hereby given that the following applicants have filed with the Federal Maritime Commission an application for licenses as Non-Vessel Operating Common Carrier and Ocean Freight Forwarder—Ocean Transportation Intermediary pursuant to section 19 of the Shipping Act of 1984 as amended (46 U.S.C. app. 1718 and 46 CFR 515).
Persons knowing of any reason why the following applicants should not receive a license are requested to contact the Office of Transportation Intermediaries, Federal Maritime Commission, Washington, D.C. 20573.
Agency for Healthcare Research and Quality (AHRQ), formerly AHCPR, DHHS.
Notice of public meeting.
On October 20, 2000, AHRQ held a public meeting to hear comments from the public on specific qualifying criteria for identifying clinical trials appropriate for Medicare coverage. To provide additional time for organizations and institutions interested in presenting and/or submitting their comments, AHRQ is holding a second public meeting on November 20, from 9 a.m. to 1 p.m.
In the past, Medicare has not paid for health care services provided as part of clinical trials because of their experimental nature. To carry out an executive memorandum from the President of the United States to the Secretary of Health and Human Services, received on June 7, 2000 directing Medicare to promptly provide for payment of routine patient care costs incurred by Medicare beneficiaries in connection with participation in clinical trials, the Health Care Financing Administration (HCFA) has issued a National Coverage Decision. The text of the NCD is available on the HCFA website: (
This notice announces a public meeting for the purpose of receiving oral and written comments on easily verifiable qualifying criteria for identifying clinical trials appropriate for Medicare coverage. The criteria should be objective (dichotomous yes/no answers) and should not require a detailed and technical expert assessment of each trial.
The second public meeting will take place on November 20, from 9 a.m. to 1 p.m.
The meeting will be held at the Agency for Healthcare Research and Quality Conference Center, 6010 Executive Blvd., 4th Floor, Rockville, MD 20852.
Nilam Patel, M.P.H., Center for Practice and Technology Assessment, AHRQ, 6010 Executive Blvd., Suite 300, Rockville, MD 20852; phone: (301) 594-0236; Fax: (301) 594-4027; E-mail:
If sign language interpretation or other reasonable accommodations for a disability is needed, please contact Linda Reeves, Assistant Administrator for Equal Opportunity, AHRQ, at (301) 594-6662 no later than three days before the meeting date.
In June, 2000, the President of the United States issued an executive memorandum directing the Secretary of Health and Human Resources to “explicitly authorize Medicare payment for routine patient care costs * * * and costs due to medical complications associated with participation in clinical trials.” In keeping with the President's directive, HCFA has developed and added a new section in the Medicare Coverage Issues Manual that will implement national coverage of routine costs of qualified clinical trials. For the purposes of this national coverage decision, routine costs of clinical trials include all items and services that are otherwise generally available to Medicare beneficiaries (conventional care); for example, hospital services, physician services, and diagnostic tests that are not statutorily excluded from coverage. Certain costs, such as the investigational item or service, itself, items and services provided solely to satisfy data collection and analysis needs and that are not used in the direct clinical management of the patient (
In order to implement the coverage policy, a system must be in place to help identify trials that meet an appropriate standard of quality and for which it is appropriate for Medicare to pay the associated routine costs. HCFA requested AHRQ to form a multi-agency Federal Panel to develop qualifying criteria that would indicate a high probability that a trial has the following desirable characteristics of a scientifically sound clinical trial:
(1) The principal purpose of the trial is to test whether the intervention potentially improves the participants' health outcomes;
(2) The trial is well-supported by available scientific and medical information or it is intended to clarify to establish the health outcomes of interventions already in common clinical use;
(3) The trial does not unjustifiably duplicate existing studies;
(4) The trial design is appropriate to answer the research question being asked in the trial;
(5) The trial is sponsored by a credible organization or conducted by an individual capable of executing the proposed trial successfully;
(6) The trial is in compliance with Federal regulations relating to the protection of human subjects; and
(7) The trial is conducted according to appropriate standards of scientific integrity.
Certain trials are presumed by AHRQ, and the other members of the Panel that it has convened, to be of sound quality and to have these desirable characteristics. Guided by the assumptions of the Panel and discussions with AHRQ, HCFA announced both long term and short term types of automatic qualification for Medicare coverage of the routine costs of clinical trials in its related NCD.
“Effective September 19, 2000, clinical trials that are deemed to be automatically qualified are:
1. Trials funded by NIH, CDC, AHRQ, HCFA, DOD, and VA;
2. Trials supported by centers or cooperative groups that are funded by the NIH, CDC, AHRQ, HCFA, DOD and VA;
3. Trials conducted under an investigational new drug application (IND) reviewed by the FDA; and
4. Drug trials that are exempt from having an IND under 21 CFR 312.2(b)(1) will be deemed automatically qualified until the qualifying criteria are developed and the certification process is in place. At that time the principal investigators of these trials must certify
The Panel will be developing criteria for identifying other trials that are likely to have the seven desirable characteristics of clinical trials. (From HCFA's Final National Coverage Decision posted on HCFA's website (http://www.hcfa.gov/quality/8d2.htm).
AHRQ is holding this second meeting to ensure that all interested parties have adequate time to provide comments and pertinent information that would contribute to defining specific and unambiguous qualifying criteria for identifying clinical trials appropriate for Medicare coverage. We are soliciting comments about what specific qualifying criteria might be used to select trials that are likely to have the desirable characteristics of scientifically sound clinical trials identified by HCFA. The criteria should be easily verifiable, should not require a detailed and expert trial by trial review, and, where possible, be dichotomous (that is, objective yes/no responses). Some examples might be:
AGRQ is also interested in receiving information on the availability of relevant literature (citations or copies if possible) that might assist the Panel in its formation of the qualifying criteria.
The meeting will begin at 9 a.m. and continue through 1 p.m. If more requests to make oral statements are received than can be accommodated at this meeting, the chair person will allocate speaking time in a manner that attempts, to the extent possible, to have a range of information, findings, and views presented orally. Those who cannot be granted speaking time because of time constraints are assured that their written comments will be considered along with other evidence during the course of further discussions and report preparation.
In accordance with section 10(a)(2) of the Federal Advisory Committee Act (Pub.L. 92-463), the Centers for Disease Control and Prevention (CDC) announces the following committee meeting:
Agenda items are tentative and subject to change as priorities dictate.
The Director, Management Analysis and Services Office, has been delegated the authority to sign
Administration on Children, Youth and Families, ACF, DHHS.
Correction.
This document contains a correction to the Notice that was published in the
On page 55256, in the State of Alaska, in the Funding for the following counties column, delete “$797,487” and replace with “$914,488”.
On page 55256, in the State of Arizona, in the County of Maricopa, in the Funding for the following counties column, delete “$895,843” and replace with “$956,190”.
On page 55256, in the State of California, add “Alameda” to the County column, and next to that add “$1,254,931” in the Funding for the following counties column, and in the Current service area column add “San Leandro, San Lorenzo, Castro Valley, Hayward, Union City, Fremont, Newark, Livermore, Pleasanton, and Dublin”.
On page 55256, in the State of California, in the County of El Dorado, in the Funding for the following counties column, delete “884,818” and replace with “$947,640”.
On page 55256, in the State of California, in the County of Fresno, in the Funding to the following counties column, delete “752,322” and replace with “798,213”.
On page 55256, in the State of California, in the County of Nevada, in the Funding to the following counties column, delete “$1,077,655” and replace with “$1,146,292”.
On page 55256, in the State of California, in the County of San Mateo, in the Funding to the following counties column, delete “$641,039” and replace with “$1,072,738” and in the Current service area column, delete “Half Moon Bay” with replace with “Entire County”.
On page 55256, in the State of Colorado, in the County of Denver, next to the Funding amount of $1,380,779, in the Current service area column, after Montbello delete “and City Park” and replace with “City Park, Globeville, Skyland and North Capitol Hill”.
On page 55257, in the State of Hawaii, in the County of Oahu, in the Funding for the following counties column, delete “$635,745” and replace with “$678,925” and in the County of Oahu, in the Funding for the following counties column, delete “$453,443” and replace with “$481,104”.
On page 55257, in the State of Idaho, add “Nez Perce” to the County Column, and add “Nez Perce Reservation” in the Current service area column.
On page 55259, in the State of New York, in the County of Saratoga, in the Funding for the following counties column, delete “$998,746” and replace with “$927,124”.
On page 55259, in the State of North Dakota, delete “Carson” from the County column, delete “$797,487” from the Funding for the following counties column, and delete “Boundaries of Standing Rock Reservation” from the Current service area column.
On page 55259, in the State of North Dakota, in the County of Sioux, add “$797,487” to the Funding for the following counties column and delete “Boundaries of Standing Rock Reservation” from the Current service area column and replace with “Standing Rock Sioux Reservation”.
On page 55259, in the State of South Dakota, in the County of Pennington, in the Funding for the following counties column, delete “$795,140” and replace with “$1,155,140”.
On page 55259, in the State of South Dakota, in the County column, after Meade, add the following County: “Lawrence” and in the Current service area column add “Entire County”.
On page 55259, in the State of South Dakota, in the County column after Lawrence, add the following County: “Fall River” and in the Current service area column add “Entire County”.
On page 55259, in the State of South Dakota, in the County Column after “Fall River”, add the following County: “Custer” and in the Current service area column add “Entire County”.
On page 55259, in the State of South Dakota, in the County Column after “Custer”, add the following County: “Jackson” and in the Current service area column add “Entire County”.
On page 55259, in the State of South Dakota, in the County Column after “Jackson”, add the following County: “Haakon” and in the Current service area column add “Entire County”.
On page 55259, in the State of South Dakota, add “Corson” to the County column, and in the Current service area column add “Standing Rock Sioux Reservation” and add the following note in the Current service area column: “Note: for funding level see North Dakota, Sioux County”.
On page 55260, in the State of Virginia, in the County of Buchanan, in the Funding for the following counties column, delete “$425,640” and replace with “$657,534”.
The ACYF Operations Center at 1-800-351-2293 or send an email to
Food and Drug Administration, HHS.
Notice.
The Food and Drug Administration (FDA) is requesting nominations for four members to serve on the Pharmacy Compounding Advisory Committee in the Center for Drug Evaluation and Research.
FDA has special interest in ensuring that women, minority groups, and the physically challenged are adequately represented on advisory committees and, therefore, extends particular encouragement to nominations for appropriately qualified female, minority, or physically challenged candidates. Final selection from among each vacancy will be determined by the expertise required to meet specific agency needs and in a manner to ensure appropriate balance of membership.
Nominations should be received on or before December 1, 2000.
All nominations for membership should be sent to Jayne E. Peterson (address below).
On November 21, 1997, the President signed the Food and Drug Administration Modernization Act of 1997 (Public Law 105-115) (the Modernization Act). Section 127 of the Modernization Act added section 503A to the Federal Food, Drug, and Cosmetic Act (the act) (21 U.S.C. 353a)). Section 503A of the act directs FDA to issue regulations relating to the application of Federal law to the practice of pharmacy compounding. To assist the agency in preparing these regulations, Congress directed FDA to convene and consult an advisory committee that will include representatives of the National Association of Boards of Pharmacy (NABP), the United States Pharmacopeia (USP), pharmacy, physician and consumer organizations, as well as other experts selected by the agency. The Pharmacy Compounding Advisory Committee was formed on March 10, 1998, and 15 members were appointed to the committee. The terms of four members have expired or the positions have otherwise become vacant. Accordingly, FDA is requesting nominations for four members to serve on the Pharmacy Compounding Advisory Committee.
The function of the committee is to provide advice on scientific, technical, and medical issues concerning drug compounding by licensed practitioners and to make appropriate recommendations to the Commissioner of Food and Drugs.
Persons nominated for membership should have expertise in one or more of the following fields: Pharmaceutical
Interested persons may nominate one or more qualified persons for membership on the advisory committee. Nominations shall state that the nominee is willing to serve as a member of the advisory committee and appears to have no conflict of interest that would preclude committee membership. Potential candidates will be asked by FDA to provide detailed information concerning such matters as financial holdings, consultancies, and research grants or contracts to permit evaluation of possible sources of conflict of interest.
This notice is issued under the Federal Advisory Committee Act (5 U.S.C. app. 2), section 503A of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 353a), section 904 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 394) as amended by the Food and Drug Administration Revitalization Act (Public Law 101-635), and 21 CFR part 14, relating to advisory committees.
Substance Abuse and Mental Health Services Administration, HHS.
Notice.
The Department of Health and Human Services notifies Federal agencies of the laboratories currently certified to meet standards of Subpart C of Mandatory Guidelines for Federal Workplace Drug Testing Programs (59 FR 29916, 29925). A similar notice listing all currently certified laboratories will be published during the first week of each month, and updated to include laboratories which subsequently apply for and complete the certification process. If any listed laboratory's certification is totally suspended or revoked, the laboratory will be omitted from updated lists until such time as it is restored to full certification under the Guidelines.
If any laboratory has withdrawn from the National Laboratory Certification Program during the past month, it will be listed at the end, and will be omitted from the monthly listing thereafter.
This Notice is also available on the internet at the following website:
Mrs. Giselle Hersh or Dr. Walter Vogl, Division of Workplace Programs, 5600 Fishers Lane, Rockwall 2 Building, Room 815, Rockville, Maryland 20857; Tel.: (301) 443-6014, Fax: (301) 443-3031.
Please use the above address for all surface mail and correspondence. For all overnight mail service use the following address: Division of Workplace Programs, 5515 Security Lane, Room 815, Rockville, Maryland 20852.
Mandatory Guidelines for Federal Workplace Drug Testing were developed in accordance with Executive Order 12564 and section 503 of Pub. L. 100-71. Subpart C of the Guidelines, “Certification of Laboratories Engaged in Urine Drug Testing for Federal Agencies,” sets strict standards which laboratories must meet in order to conduct urine drug testing for Federal agencies. To become certified an applicant laboratory must undergo three rounds of performance testing plus an on-site inspection. To maintain that certification a laboratory must participate in a quarterly performance testing program plus periodic, on-site inspections.
Laboratories which claim to be in the applicant stage of certification are not to be considered as meeting the minimum requirements expressed in the HHS Guidelines. A laboratory must have its letter of certification from SAMHSA, HHS (formerly: HHS/NIDA) which attests that it has met minimum standards.
In accordance with Subpart C of the Guidelines, the following laboratories meet the minimum standards set forth in the Guidelines:
*The Standards Council of Canada (SCC) voted to end its Laboratory Accreditation Program for Substance Abuse (LAPSA) effective May 12, 1998. Laboratories certified through that program were accredited to conduct forensic urine drug testing as required by U.S. Department of Transportation (DOT) regulations. As of that date, the certification of those accredited Canadian laboratories will continue under DOT authority. The responsibility for conducting quarterly performance testing plus periodic on-site inspections of those LAPSA-accredited laboratories was transferred to the U.S. DHHS, with the DHHS' National Laboratory Certification Program (NLCP) contractor continuing to have an active role in the performance testing and laboratory inspection processes. Other Canadian laboratories wishing to be considered for the NLCP may apply directly to the NLCP contractor just as U.S. laboratories do. Upon finding a Canadian laboratory to be qualified, the DHHS will recommend that DOT certify the laboratory (
Office of the Chief Information Officer, HUD.
Notice.
The proposed information collection requirement described below has been submitted to the Office of Management and Budget (OMB) for review, as required by the Paperwork Reduction Act. The Department is soliciting public comments on the subject proposal.
December 1, 2000.
Interested persons are invited to submit comments regarding this proposal. Comments should refer to the proposal by name and/or OMB approval number (2539-0008) and should be sent to: Joseph F. Lackey, Jr., OMB Desk Officer, Office of Management and Budget, Room 10235, New Executive Office Building, Washington, DC 20503.
Wayne Eddins, Reports Management Officer, Q, Department of Housing and Urban Development, 451 Seventh Street, Southwest, Washington, DC 20410; e-mail Wayne_Eddins@HUD.gov; telephone (202) 708-2374. This is not a toll-free number. Copies of the proposed forms and other available documents submitted to OMB may be obtained from Mr. Eddins.
The Department has submitted the proposal for the collection of information, as described below, to OMB for review, as required by the Paperwork Reduction Act (44 U.S.C. Chapter 35). The Notice lists the following information: (1) The title of the information collection proposal; (2) the office of the agency to collect the information; (3) the OMB approval number, if applicable; (4) the description of the need for the information and its proposed use; (5) the agency form number, if applicable; (6) what members of the public will be affected by the proposal; (7) how frequently information submissions will be required; (8) an estimate of the total number of hours needed to prepare the information submission including number of respondents, frequency of response, and hours of response; (9) whether the proposal is new, an extension, reinstatement, or revision of an information collection requirement; and (10) the name and telephone number of an agency official familiar with the proposal and of the OMB Desk Officer for the Department.
This Notice also lists the following information:
Section 3507 of the Paperwork Reduction Act of 1995, 44 U.S.C. 35, as amened.
Office of the Assistant Secretary for Policy Development and Research, HUD.
Announcement of funding awards.
In accordance with section 102 (a)(4)(C) of the Department of Housing and Urban Development Reform Act of 1989, this document notifies the public of funding awards for Fiscal Year 2000 Alaska Native/Native Hawaiian Institutions Assisting Communities Program. The purpose of this document is to announce the names and addresses of the award winners and the amount of the awards which are to be used to help Alaska Native and Native Hawaiian Institutions of Higher Education expand their role and effectiveness in addressing community development needs in their localities, consistent with the purposes of HUD's Community Development Block Grant program (CDBG).
Jane Karadbil, Office of University Partnerships, U.S. Department of Housing and Urban Development, Room 8110, 451 Seventh Street, S.W., Washington, DC 20410, telephone (202) 708-1537, extension 5918. To provide service for persons who are hearing-or-speech-impaired, this number may be reached via TTY by Dialing the Federal Information Relay Service on 1-800-877-TTY, 1-800-877-8339, or 202-708-1455. (Telephone number, other than “800” TTY numbers are not toll free.)
The Alaska Native/Native Hawaiian Institutions Assisting Communities Program (HSIAC) was enacted under section 107 of the CDBG appropriation for fiscal year 2000, as part of the “Veterans Administration, HUD and Independent Agencies Appropriations Act of 2000” and is administered by the Office of University Partnerships under the Assistant Secretary for Policy Development and Research. In addition to this program, the Office of University Partnerships administers HUD's ongoing grant programs to institutions of higher education as well as creates initiatives through which colleges and universities can bring their traditional missions of teaching, research, service, and outreach to bear on the pressing local problems in their communities.
The Alaska Native/Native Hawaiian Institutions Assisting Communities Program provides funds for a wide range of CDBG-eligible activities including housing rehabilitation and financing, property demolition or acquisition, public facilities, economic development, business entrepreneurship, and fair housing programs. On February 24, 2000 (65 FR 9469), HUD published a Notice of Funding Availability (NOFA) announcing the availability of $2 million in Fiscal Year 2000 funds for the Alaska Native/Native Hawaiian Institutions Assisting Communities Program. The Department reviewed, evaluated and scored the applications received based on the criteria in the NOFA. As a result, HUD two applications were funded. These grants, with their grant amounts are identified below.
The Catalog Federal Domestic Assistance number for this program is 14.515.
In accordance with section 102(a)(4)(C) of the Department of Housing and Urban Development Reform Act of 1989 (Pub. L. 101-235, approved December 15, 1989), the Department is publishing details concerning the recipients of funding awards, as follows:
1. University of Hawaii at Manoa, Dr. Lilikala Kame'eleihiwa, University of Hawaii at Manoa, 2530 Dole Street, Honolulu, HI 96822. Grant: $333,280.
2. Ilisagvik College, Dr. Andrew Hageman, Ilisagvik College, 360 NARL, Barrow, AK 99723. Grant: $332,754.
Office of the Assistant Secretary for Policy Development and Research, HUD.
Announcement of funding awards.
In accordance with section 102 (a)(4)(C) of the Department of Housing and Urban Development Reform Act of 1989, this document notifies the public of funding awards for Fiscal Year 2000 Community Outreach Partnership Centers Program. The purpose of this document is to announce the names and addresses of the award winners and the amount of the awards which are to be used to establish and operate Community Outreach Partnership Centers that will: (1) Conduct competent and qualified research and investigation on theoretical or practical problems in large and small cities; and (2) facilitate partnerships and outreach activities between institutions of higher education, local communities, and local governments to address urban problems.
Jane Karadbil, Office of University Partnerships, U.S. Department of Housing and Urban Development, Room 8110, 451 Seventh Street, S.W., Washington, DC 20410, telephone (202) 708-1537, extension 5918. To provide service for persons who are hearing-or-speech-impaired, this number may be reached via TTY by Dialing the Federal Information Relay Service on 1-800-877-TTY, 1-800-877-8339, or 202-708-1455. (Telephone number, other than “800” TTY numbers are not toll free.)
The Community Outreach Partnership Centers Program was enacted in the Housing and Community Development Act of 1992 (Pub. L. 102-550, approved October 28, 1992) and is administered by the Office of University Partnerships under the Assistant Secretary for Policy Development and Research. In addition to this program, the Office of University
The Community Outreach Partnership Centers Program provides funds for: research activities which have practical application for solving specific problems in designated communities and neighborhoods; outreach, technical assistance and information exchange activities which are designed to address specific problems associated with housing, economic development, neighborhood revitalization, infrastructure, health care, job training, education, crime prevention, planning, and community organizing. On February 24, 2000 (65 FR 9405 ), HUD published a Notice of Funding Availability (NOFA) announcing the availability of $8 million in Fiscal Year 2000 funds for the Community Outreach Partnership Centers Program. The Department reviewed, evaluated and scored the applications received based on the criteria in the NOFA. As a result, HUD has funded 16 applications for New Grants and 8 applications for New Directions Grants . New Grants, which cannot exceed $400,000, are for institutions of higher education just beginning a COPC project. New Directions Grants, which cannot exceed $150,000, are for institutions of higher education that are undertaking new activities or expanding into new neighborhoods. These grants, with their grant amounts are identified below.
The Catalog Federal Domestic Assistance number for this program is 14.511.
In accordance with section 102(a)(4)(C) of the Department of Housing and Urban Development Reform Act of 1989 (Pub. L. 101-235, approved December 15, 1989), the Department is publishing details concerning the recipients of funding awards, as follows:
1. Trinity College, Alta Lash, Trinity College, 300 Summit Street, Hartford, CT 06106. Grant: $149,984.
2. University of Rhode Island, Dr. Marcia Marker Feld, University of Rhode Island, 70 Lower College Road, Kingston, RI 02881. Grant: $150,000.
3. Medgar Evers College, Dr. E. Thomas Oliver, Medgar Evers College, 1150 Carroll Street, Brooklyn, NY 11225. Grant: $399,663.
4. Danville Community College, Martha A. Walker, Danville Community College, 1008 South Main Street, Danville, VA 24541. Grant: $391,903.
5. Duquesne University, Dr. Evan Stoddard, Duquesne University, 600 Forbes Avenue, 403 Administration Building, Pittsburgh, PA 15282. Grant: $150,000.
6. Tidewater Community College, Mary Ruth Clowdsley, Tidewater Community College, 7000 College Drive, Portsmouth, VA 23703. Grant: $395,227.
7. University of Pennsylvania, Dr. Ira Harkavy, University of Pennsylvania, 133 South 36th Street, Mezzanine, Philadelphia, PA 19104. Grant: $150,000.
8. University of Pittsburgh, Tracy Soska, University of Pittsburgh, 350 Thackeray Hall, Pittsburgh, PA 15260. Grant: $399,702.
9. Auburn University, Dr. Robert Montjoy, Auburn University, Auburn University, AL 36849. Grant: $382,267.
10. Barry University, Dr. Jacqueline Mondros, Barry University, 11300 Northeast 2nd Avenue, Miami Shores, FL 33161. Grant: $399,982.
11. University of Memphis, Dr. David Cox, University of Memphis, Memphis, TN 38152. Grant: $149,940.
12. Ball State University, Eric Kelly, Ball State University, 2000 University Avenue, Muncie, IN 47306. Grant: $398,529.
13. DePaul University, Jerry Watson, DePaul University, 1 East Jackson Blvd., Chicago, IL 60604. Grant: $150,000.
14. Indiana University, Northwest, Dan Lowry, Indiana University, Northwest, P.O. Box 1847, Bloomington, IN 46402. Grant: $399,973.
15. Medical College of Wisconsin, Dr. Cheryl Maurana, Medical College of Wisconsin, 8701 Watertown Plank Road, Milwaukee, WI 53226. Grant: $398,037.
16. University of Wisconsin-Parkside, Dr. Anne Statham, University of Wisconsin-Parkside, 900 Wood Road, Box 2000, Kenosha, WI 53141. Grant: $150,000.
17. Western Michigan University, Sharon Anderson, Western Michigan University, Kalamazoo, MI 49008. Grant: $399,996.
18. Youngstown State University, Dr. Gil Peterson, Youngstown State University, One University Plaza, Youngstown, OH 44555. Grant: $399,952.
19. Texas A&M University, Kermit Black, Texas A&M University, 3121 TAMU, College Station, TX 77843. Grant: $150,000.
20. University of Northern Iowa, Dr. R. Allen Hays, University of Northern Iowa, Cedar Falls, IA 50614. Grant: $382,063.
21. University of Denver, Dr. David Lisman, University of Denver, 2199 S. University Blvd., Denver, CO 80208. Grant: $355,602.
22. California State University, Hayward, Dr. Nan Maxwell, California State University, Hayward, 25976 Carlos Bee Blvd., Hayward, CA 94542. Grant: $400,000.
23. University of Southern California, Dr. Tridib Banerjee, University of Southern California, University Campus Park, Los Angeles, CA 90089. Grant: $400,000.
24. Seattle Central Community College, Dr. A. Barretto Ogilvie, Seattle Central Community College, 1701 Broadway, 2BE 4180J, Seattle, WA 98122. Grant: $372,775.
Office of the Assistant Secretary for Policy Development and Research, HUD.
Announcement of funding awards.
In accordance with section 102 (a)(4)(C) of the Department of Housing and Urban Development Reform Act of 1989, this document
Jane Karadbil, Office of University Partnerships, U.S. Department of Housing and Urban Development, Room 8110, 451 Seventh Street, S.W., Washington, DC 20410, telephone (202) 708-1537, extension 5918. To provide service for persons who are hearing-or-speech-impaired, this number may be reached via TTY by Dialing the Federal Information Relay Service on 1-800-877-TTY, 1-800-877-8339, or 202-708-1455. (Telephone number, other than “800” TTY numbers are not toll free.)
The Hispanic-serving Institutions Assisting Communities Program (HSIAC) was enacted under section 107 of the CDBG appropriation for fiscal year 2000, as part of the “Veterans Administration, HUD and Independent Agencies Appropriations Act of 2000” and is administered by the Office of University Partnerships under the Assistant Secretary for Policy Development and Research. In addition to this program, the Office of University Partnerships administers HUD's ongoing grant programs to institutions of higher education as well as creates initiatives through which colleges and universities can bring their traditional missions of teaching, research, service, and outreach to bear on the pressing local problems in their communities.
The Hispanic-serving Institutions Assisting Communities Program provides funds for a wide range of CDBG-eligible activities including housing rehabilitation and financing, property demolition or acquisition, public facilities, economic development, business entrepreneurship, and fair housing programs. On February 24, 2000 (65 FR 9455), HUD published a Notice of Funding Availability (NOFA) announcing the availability of $6.5 million in Fiscal Year 2000 funds for the Hispanic-serving Institutions Assisting Communities Program. The Department reviewed, evaluated and scored the applications received based on the criteria in the NOFA. As a result, HUD 15 applications were funded. These grants, with their grant amounts are identified below.
The Catalog Federal Domestic Assistance number for this program is 14.514.
In accordance with section 102(a)(4)(C) of the Department of Housing and Urban Development Reform Act of 1989 (Pub. L. 101-235, approved December 15, 1989), the Department is publishing details concerning the recipients of funding awards, as follows:
1. Hudson County Community College, Dr. Estelle Greenberg, Hudson County Community College, 25 Journal Square, Jersey City, NJ 07306. Grant: $398,826.
2. Albuquerque Technical Vocational Institute, Dr. John Walstrum, Albuquerque Technical Vocational Institute, 525 Buena Vista SW, Albuquerque, NM 87106. Grant: $400,000.
3. El Paso Community College, C. Alfred Lawrence, El Paso Community College, P.O. Box 20500, El Paso, RX 79998. Grant: $399,000.
4. Houston Community College, Helga Mattei, Houston Community College, P.O. Box 7849, 22 Waugh Drive, Houston, TX 77270. Grant: $395,000.
5. Midland College, Rebecca Bell, Midland College, 3600 N. Garfield, Midland, TX 79705. Grant: $400,000.
6. New Mexico State University-Dona Ana Branch Community College, Dr. Majorie Burr, New Mexico State University-Dona Ana Branch Community College, Box 30001, MSC 3DA, Las Cruces, NM 88003. Grant: $400,000.
7. Palo Alto College, Mike Floes, Palo Alto College, 1400 W. Villaret, San Antonio, TX 78224. Grant: $362,720.
8. University of New Mexico, Teresa Cordova, University of New Mexico, 105 Scholes Hall, Albuquerque, NM 87131. Grant: $398,388.
9. University of Texas at El Paso, Jeanette Holmes, University of Texas at El Paso, 500 West University Avenue, El Paso, TX 79968. Grant: $399,964.
10. University of Southern Colorado, C.J. Crumley, University of Southern Colorado, 2200 Bonforte Blvd., Pueblo, CO 81001. Grant: $400,000.
11. Arizona Western College, Dr. Cheryl Johnson, Arizona Western College, P.O. Box 929, Yuma, AZ 85366. Grant: $374,548.
12. California State University, Northridge, Dr. Jorge Garcia, California State University, Northridge, 18111 Nordhoff Street, Northridge, CA 91330. Grant: $400,000.
13. Merced College, Don Curtaz, Merced College, 3600 M Street, Merced, CA 95348. Grant: $400,000.
14. San Diego State University, Imperial Valley Campus, Suzanna Fuentes-Ferreiro, San Diego State University, Imperial Valley, 5250 Campanile Drive, San Diego, CA 92182. Grant: $400,000.
15. Yosemite Community College District, Modesto Junior College, Dr. Tom Bennett, Yosemite Community College District, Modesto Junior College, 2201 Blue Gum Avenue, P.O. Box 65, Modesto, CA 95352. Grant: $400,000.
Bureau of Land Management, Interior.
Special Resource Advisory Council Meeting—Black Rock Desert Management Plan.
In accordance with the Federal Land Policy and Management Act and the Federal Advisory Committee Act of 1972 (FACA), a Department of the Interior, Bureau of Land Management (BLM) Resource Advisory Council meeting will be held as indicated below. Topics for discussion include the review of public comments received on the Black Rock Desert Management Plan, and the time line proposed for completion of the final management plan and environmental impact statement. This meeting is open to the public. The public may present written comments to the Council. The public comment period for items
The Council will meet on Monday, December 4, 2000, from 9 a.m. to 4:30 p.m., at the Fernley Town Complex, 595 Silver Lace Blvd., Fernley, Nevada.
Les Boni, Assistant Field Manager Nonrenewable Resources, Winnemucca Field Office, 5100 E. Winnemucca Blvd., Winnemucca, Nevada 89445, telephone (775) 623-1500.
On the basis of the record
The Commission instituted these reviews on August 2, 1999 (64 F.R. 41958) and determined on November 4, 1999 that it would conduct full reviews (64 F.R. 62689, November 17, 1999). Notice of the scheduling of the Commission's reviews and of a public hearing to be held in connection therewith was given by posting copies of the notice in the Office of the Secretary, U.S. International Trade Commission, Washington, DC, and by publishing the notice in the
The Commission transmitted its determinations in these investigations to the Secretary of Commerce on October 25, 2000. The views of the Commission are contained in USITC Publication 3361 (October 2000), entitled Gray Portland Cement and Cement Clinker from Japan, Mexico, and Venezuela: Investigations Nos. 303-TA-21 (Review) and 731-TA-451, 461, and 519 (Review).
By order of the Commission.
Pursuant to Section 221 of the Trade Act of 1974, an investigation was initiated on September 25, 2000, in response to a petition filed by a company official on behalf of workers at Eramet Marietta, Incorporated, Marietta, Ohio.
The petition group of workers is subject to an ongoing investigation for which a determination has not yet been issued (TA-W-38,113). Consequently, further investigation in this case would serve no purpose, and the investigation has been terminated.
In accordance with Section 223 of the Trade Act of 1974 (19 U.S.C. 2273) the Department of Labor issued a Certification of Eligibility to Apply for Worker Adjustment Assistance on August 11, 1999, applicable to workers of Levi Strauss & Company, Wichita Falls Plant, Wichita Falls, Texas. The notice was published in the
At the request of the company, the Department reviewed the certification for workers of the subject firm. The workers are engaged in the production of denim and Docker apparel. The company reports that worker separations occurred at the Walnut Creek Road Office of Levi Strauss located in Walnut Creek, California. The Walnut Creek Road Office is a satellite office of the subject firms' headquarters located in San Francisco, California and directly supports Levi Strauss's many production facilities.
The intent of the Department's certification is to include all workers of Levi Strauss & Company adversely affected by increased imports. Accordingly, the Department is amending the certification to include workers of Levi Strauss & Company, Walnut Creek Road Office, Walnut Creek, California.
The amended notice applicable to TA-W-36,633 is hereby issued as follows:
All workers of Levi Strauss & Company, Wichita Falls Plant, Wichita Falls, Texas (TA-W-36,633) and Walnut Creek Road Office, Walnut Creek, California (TA-W-36,633AA) who became totally or partially separated from employment on or after
Pursuant to Section 221 of the Trade Act of 1974, an investigation was initiated on August 28, 2000 in response to a petition filed by a company official on the same date on behalf of workers at Maxco-Tech Designs, Inc., Edgewater, New Jersey.
The petitioner has requested that the petition be withdrawn. Consequently, further investigation in this case would serve no purpose, and the investigation has been terminated.
On October 18, 2000, the company requested Administrative Reconsideration for workers and former workers of the subject firm engaged in the production of stud lumber.
The initial investigation resulted in a negative determination issued on October 3, 2000, because imports did not contribute importantly to the worker separations. The notice soon will be published in the
New information submitted to the Department by the company and additional information supplied by a primary customer of the subject firm revealed that the customer has increased purchases of imported stud lumber while reducing purchases from the subject firm.
All workers of Wallowa Forest Products, Wallowa, Oregon, who became totally or partially separated from employment on or after June 27, 1999 through two years from the date of this certification are eligible to apply for adjustment assistance under Section 223 of the Trade Act of 1974.
In accordance with Section 250(a), Subchapter D, Chapter 2, Title II, of the Trade Act of 1974, as amended (19 USC 2273), the Department of Labor issued a Certification of Eligibility to Apply for NAFTA Transitional Adjustment Assistance on September 20, 2000, applicable to workers of American Bag Corporation, Stearns, Kentucky. The notice was published in the
At the request of the company, the Department reviewed the certification for workers of the subject firm. The company reports that worker separations occurred at the Winfield, Tennessee facility of American Bag Corporation. The workers are engaged in the production of air bags.
The intent of the Department's certification is to include all workers of American Bag Corporation affected by increased imports from Canada and Mexico. Accordingly, the Department is amending the certification to include workers of American Bag Corporation, Winfield, Tennessee.
The amended notice applicable to NAFTA-04107 is hereby issued as follows:
All workers of American Bag Corporation, Stearns, Kentucky (NAFTA-04107) and Winfield, Tennessee (NAFTA-04107A) who became totally or partially separated from employment on or after August 23, 1999 through September 20, 2002, are eligible to apply for NAFTA-TAA under Section 250 of the Trade Act of 1974.
Pursuant to Title V of the North American Free Trade Agreement Implementation Act and in accordance with Section 250(a), Subchapter D, Chapter 2, Title II of the Trade Act of 1974, as amended (19 U.S.C. 2331), an investigation was initiated on August 10, 2000, in response to a worker petition which was filed by the International Association of Machinists and Aerospace Workers, District 24, Local Lodge 1432, on behalf of workers at Consolidated Metco, Inc., Rivergate Plant, Portland, Oregon.
The petitioner has requested that the petition be withdrawn. Consequently further investigation in this case would serve no purpose, and the investigation has been terminated.
In accordance with Section 250(a), Subchapter D, Chapter 2, Title II, of the Trade Act of 1974, as amended (19 USC 2273), the Department of Labor issued a Certification of Eligibility to Apply for NAFTA Transitional Adjustment Assistance on August 11, 1999, applicable to workers of Levi Strauss & Company, Wichita Falls Plant, Wichita Falls, Texas. The notice was published in the
At the request of the company, the Department reviewed the certification for workers of the subject firm. The workers are engaged in the production of denim and Docker apparel. The company reports that worker separations occurred at the Walnut Creek Road Office of Levi Strauss located in Walnut Creek, California. The Walnut Creek Road Office is a satellite office of the subject firms' headquarters in San Francisco, California and directly supports Levi Strauss's many production facilities. The intent of the Department's certification is to include all workers of Levi Strauss and Company who were adversely affected by increased imports of denim and Docker apparel from Mexico.
The amended notice applicable to NAFTA—03325 is hereby issued as follows:
All workers of Levi Strauss & Company, Wichita Falls Plant, Wichita Falls, Texas (NAFTA-03325) and Walnut Creek Road Office, Walnut Creek, California (NAFTA-03325AA) who became totally or partially separated from employment on or after August 8, 1999 through August 11, 2001 are eligible to apply for NAFTA-TAA under Section 250 of the Trade Act of 1974.
On August 18, 2000, the Department issued a Negative Determination Regarding Eligibility to apply for NAFTA-TAA, applicable to workers and former workers of Morton Forest Products, a.k.a. Tree Source, located in Morton, Washington. The notice was published in the
By letter of September 20, 2000, the company requested administrative reconsideration regarding the Department's denial of NAFTA-TAA for workers of the subject firm. Workers at Morton Forest Products, located in Morton, Washington, were engaged in the manufacture of stud lumber. The company claimed that the Department did not survey sufficient customers and provided a list of additional customers of stud lumber.
The initial determination was based on customer surveys which indicated that imports did not contribute importantly to the worker separations at Morton Forest Products. On reconsideration, the Department surveyed additional customers. The results of the additional customer survey revealed that two major customers of the subject firm increased their reliance on purchases of imported stud lumber from Canada while reducing purchases of domestically manufactured stud lumber.
After careful review of the additional facts obtained on reconsideration, I conclude that there were increased imports from Canada of articles like or directly competitive with those produced by the subject firm. In accordance with the provisions of the Trade Act, I make the following certification:
All workers of Morton Forest Products, a.k.a. Tree Source, located in Morton, Washington engaged in employment related to the production of stud lumber who became totally or partially separated from employment on or after June 16, 1999 through two years from the issuance of this revised determination are eligible to apply for NAFTA-TAA under Section 250 of the Trade Act of 1974.
In accordance with Section 223 of the Trade Act of 1974, as amended, the Department of Labor herein presents summaries of determinations regarding eligibility to apply for trade adjustment assistance for workers (TA-W) issued during the period of October, 2000.
In order for an affirmative determination to be made and a certification of eligibility to apply for worker adjustment assistance to be issued, each of the group eligibility requirements of Section 222 of the Act must be met.
(1) that a significant number or proportion of the workers in the workers' firm, or an appropriate subdivision thereof, have become totally or partially separated,
(2) that sales or production, or both, of the firm or subdivision have decreased absolutely, and
(3) that increases of imports of articles like or directly competitive with articles produced by the firm or appropriate subdivision have contributed importantly to the separations, or threat thereof, and to the absolute decline in sales or production.
In each of the following cases the investigation revealed that criterion (3) has not been met. A survey of customers indicated that increased imports did not contribute importantly to worker separations at the firm.
In the following cases, the investigation revealed that the criteria for eligibility have not been met for the reasons specified.
The workers firm does not produce an article as required for certification under Section 222 of the Trade Act of 1974.
Increased imports did not contribute importantly to worker separations at the firm.
The following certifications have been issued; the date following the company name and location of each determination references the impact date for all workers of such determination
Also, pursuant to Title V of the North American Free Trade Agreement Implementation Act (P.L. 103-182) concerning transitional adjustment assistance hereinafter called (NAFTA-TAA) and in accordance with Section 250(a), Subchapter D, Chapter 2, Title II, of the Trade Act as amended, the Department of Labor presents summaries of determinations regarding eligibility to apply for NAFTA-TAA issued during the month of October, 2000.
In order for an affirmative determination to be made and a certification of eligibility to apply to NAFTA-TAA the following group eligibility requirements of Section 250 of the Trade Act must be met:
(1) That a significant number or proportion of the workers in the workers' firm, or an appropriate subdivision thereof, (including workers in any agricultural firm or appropriate subdivision thereof) have become totally or partially separated from employment and either—
(2) that sales or production, or both, of such firm or subdivision have decreased absolutely,
(3) that imports From Mexico or Canada of articles like or directly competitive with articles produced by such firm or subdivision have increased, and that the increases imports contributed importantly to such workers' separations or threat of separation and to the decline in sales or production of such firm or subdivision; or
(4) that there has been a shift in production by such workers' firm or subdivision to Mexico or Canada of articles like or directly competitive with
In each of the following cases the investigation revealed that criteria (3) and (4) were not met. Imports from Canada or Mexico did not contribute importantly to workers' separations. There was no shift in production from the subject firm to Canada or Mexico during the relevant period.
The investigation revealed that the criteria for eligibility have not been met for the reasons specified.
The investigation revealed that workers of the subject firm did not produce an article within the meaning of section 250(a) of the Trade Act, as amended.
I hereby certify that the aforementioned determinations were issued during the month of October, 2000. Copies of these determinations are available for inspection in Room C-5311, U.S. Department of Labor, 200 Constitution Avenue, NW., Washington, DC 20210 during normal business hours or will be mailed to persons who write to the above address.
Pension and Welfare Benefits Administration, Labor.
Grant of Individual Exemptions.
This document contains exemptions issued by the Department of Labor (the Department) from certain of the prohibited transaction restrictions of the Employee Retirement Income Security Act of 1974 (the Act) and/or the Internal Revenue Code of 1986 (the Code).
Notices were published in the
The notices of proposed exemption were issued and the exemptions are being granted solely by the Department because, effective December 31, 1978, section 102 of Reorganization Plan No. 4 of 1978, 5 U.S.C. App. 1 (1996), transferred the authority of the Secretary of the Treasury to issue exemptions of the type proposed to the Secretary of Labor.
In accordance with section 408(a) of the Act and/or section 4975(c)(2) of the Code and the procedures set forth in 29 CFR part 2570, subpart B (55 FR 32836, 32847, August 10, 1990) and based upon the entire record, the Department makes the following findings:
(a) The exemptions are administratively feasible;
(b) They are in the interests of the plans and their participants and beneficiaries; and
(c) They are protective of the rights of the participants and beneficiaries of the plans.
The restrictions of sections 406(a), 406(b)(1) and (b)(2) of the Act shall not apply to the cash sale by the Plan of certain recreational facilities (the Recreational Facilities) to the International Center for Entrepreneurial Development, Inc., the parent of Kwik-Kopy Corporation (Kwik-Kopy), the Plan sponsor, and a party in interest with respect to the Plan.
This exemption is subject to the following requirements:
(a) The proposed sale is a one-time transaction for cash.
(b) The fair market value of the Recreational Facilities has been determined by qualified, independent appraisers who propose to update their valuation of the Recreational Facilities on the date of the sale.
(c) On the date of the sale, the Plan receives an amount which is equal to the greater of the fair market value of the Recreational Facilities or the Plan's total acquisition costs.
(d) The Plan pays no fees or commissions in connection with the proposed sale.
For a more complete statement of the facts and representations supporting the Department's decision to grant this exemption, refer to the notice of proposed exemption published on August 17, 2000 at 65 FR 50223.
The Department notes that in the notice of proposed exemption, the word “Copy,” as used in references to “Kwik-Copy Corporation” or “Kwik Copy,” has been misspelled. For purposes of this exemption, the Department wishes to point out that correct spelling of the term is “Kopy.”
Ms. Jan D. Broady, of the Department, telephone (202) 219-8881. (This is not a toll-free number.)
The restrictions of section 406(a) of the Act and the sanctions resulting from the application of section 4975 of the Code, by reason of section 4975(c)(1)(A) through (D) of the Code, shall not apply, effective September 20, 2000, to (1) the receipt of certain common stock (Common Stock) issued by AMHC,
This exemption is subject to the following conditions set forth below in Section II.
(a) The Plan of Conversion is subject to approval, review and supervision by the Iowa Commissioner of Insurance (the Commissioner) and is implemented in accordance with procedural and substantive safeguards that are imposed under Iowa law.
(b) The Commissioner reviews the terms and options that are provided to Eligible Members of AMHC as part of such Commissioner's review of the Plan of Conversion and the Commissioner approves the Plan of Conversion following a determination that such Plan is fair and equitable to Eligible Members.
(c) Each Eligible Member has an opportunity to vote to approve the Plan of Conversion after full written disclosure is given to the Eligible Member by AMHC.
(d) Any determination to receive Common Stock, Cash or Policy Credits by an Eligible Member which is a Plan, pursuant to the terms of the Plan of Conversion, is made by one or more Plan fiduciaries which are independent of AMHC and its affiliates and neither AMHC Group nor any of its affiliates exercises any discretion or provides investment advice, within the meaning of 29 CFR 2510.3-21(c), with respect to such decisions.
(e) After each Eligible Member entitled to receive Common Stock is allocated at least 20 shares, additional consideration is allocated to Eligible Members who own participating policies based on actuarial formulas that take into account each participating policy's contribution to the surplus and asset valuation reserve of AMHC, which formulas have been approved by the Commission.
(f) All Eligible Members that are Plans participate in the transactions on the same basis as all Eligible Members that are not Plans.
(g) No Eligible Member pays any brokerage commissions or fees in connection with their receipt of Common Stock or Policy Credits or in connection with the implementation of the commission-free program.
(h) All of AmerUs Life's policyowner obligations remain in force and are not affected by the Plan of Conversion.
For purposes of this exemption:
(a) The term “AMHC” means American Mutual Holding Company, its successor, AmerUs Group, and any of their affiliates, as defined in paragraph (b) of this Section III.
(b) An “affiliate” of AMHC includes—
(1) Any person directly or indirectly through one or more intermediaries, controlling, controlled by, or under common control with AMHC. (For purposes of this paragraph, the term “control” means the power to exercise a controlling influence over the management or policies of a person other than an individual.)
(2) Any officer, director or partner in such person, and
(3) Any corporation or partnership of which such person is an officer, director or a 5 percent partner or owner.
(c) The term “Eligible Member” means a person who is (or, collectively, persons who are) the owner(s) of one or more “eligible policies” (the Eligible Policy or Eligible Policies) on the adoption date of the Plan of Conversion. An “Eligible Policy” is defined as a policy that has been in force for at least
(d) The term “Policy Credit” means either an increase in the accumulation account value (to which no surrender or similar charge will be applied) or an increase in a dividend accumulation on a policy or contract issued by AmerUs Life.
This exemption is effective as of September 20, 2000.
For a more complete statement of the facts and representations supporting the Department's decision to grant this exemption, refer to the notice of proposed exemption that was published on August 17, 2000 at 65 FR 50240.
The Department received nine written comments with respect to the proposed exemption. Eight comments were submitted by Plan policyowners. The ninth comment, which was submitted by AmerUs Group, the successor to AMHC, and also referred to herein as “the Applicant,” is intended to update and clarify the proposal in certain areas.
Of the policyowner comments received, four commenters expressed their approval of the exemption. Three commenters made general comments. Of the comments falling into this category, one comment was not germane to the exemption request, while the two others focused on either the commenter's retirement eligibility or the form of demutualization consideration to be received. (Both of these comments were subsequently forwarded to the Applicant for handling by appropriate personnel.) Finally, another commenter objected to the granting of the exemption because he believed the exemption would favor officers and owners of AMHC at the expense of the investors.
Following is a discussion of the comment submitted by the objecting policyowner as well as the Applicant's response to this comment. Also discussed is the Applicant's comment and the Department's responses to the specific areas of the Applicant's concern.
As discussed briefly above, the commenter is of the view that the Restructuring will not benefit investors but will entirely benefit the officers and the owners of AMHC. Therefore, the commenter asserts that he is opposed to the granting of the exemption.
In response to this comment, the Applicant explains that the Restructuring provides significant benefits to the policyowners of AmerUS Life, which are the “investors” in and “owners” of AMHC for periods prior to the Restructuring, and does not serve to benefit AMHC's officers. The Applicant notes that the Restructuring provides AmerUS Life policyowners with Common Stock, Cash or Policy Credits in exchange for such policyowners' illiquid membership interests in AMHC. Thus, according to the Applicant, policyowners may effectively convert the economic value of their membership interests into a marketable equity position, cash or an enhanced return on their AmerUs Life insurance products. The Applicant states that this realization of economic value occurs while the underlying insurance or annuity contacts remain in force, without compromising any benefits, guarantees or other rights and interests (apart from membership in AMHC) under the existing policies and contracts. Additionally, the Applicant points out that policyowners receiving Common Stock as consideration for their membership interests are expected to benefit, along with other AMHC shareholders, from the increased financial flexibility that the organization of AMHC as a stock company (rather than a mutual company) will realize. For these reasons, the Applicant believes that the view expressed by the commenter should not prevent the Department from granting the final exemption.
1.
Because of the foregoing changes, the Applicant requests that the final exemption reflect that: (a) The Plan of Conversion was approved by the Commissioner on August 1, 2000; (b) the Restructuring occurred on September 20, 2000; and (c) the Applicant's name was changed from AMHC to “AmerUs Group Co.”
The Department has noted these modifications to the proposed exemption. With respect to the Applicant's name change, the Department has added a new footnote to the operative language of the exemption to clarify that, for purposes of this exemption, all references to AMHC are deemed to include references to AmerUs Group, the successor in interest to AMHC. The Department believes that by incorporating references to AmerUs Group into the definition of the term “AMHC,” the continuity of the proposed and final exemptions will be preserved and reader confusion will be minimized. In addition, the Department has made a corresponding change to Section III(a) of the final exemption in order that it will read as follows:
For purposes of this exemption:
(a) The term “AMHC” means American Mutual Holding Company, its successor, AmerUs Group, and any of their affiliates, as defined in paragraph (b) of this Section III.
2.
However, because the publication of the proposed exemption was so close to the effective date of the Restructuring, the Applicant states that the use of the escrow arrangement became potentially burdensome. If an escrow arrangement were utilized, the Applicant explains that it would have been in place for a brief period of time and all of the fixed costs of such an arrangement would be have been borne by the Applicant.
In lieu of establishing an escrow account, the Applicant represents that it decided to distribute the demutualization consideration between October 18-24, 2000, which occurrence would be prior to the granting of the final exemption. Therefore, the
In response to this comment, the Department has made the final exemption effective as of September 20, 2000. This text appears in Section I of the final exemption, in the operative language, as well as in the section captioned
The Department notes that while the failure to describe the escrow arrangement in the Summary of Facts and Representations (the Summary) may have been due to an oversight, the Applicant counsel subsequently informed the staff, in telephone communication, of the time and monetary problems that would result if such an arrangement were ever adopted. Therefore, the Applicant requested that the exemption be made retroactive to the date of the Restructuring. The Department has complied with this request and it has not conditioned the final exemption on AMHC's use of the escrow arrangement.
3.
In response to this comment, the Department has modified the operative language of Section I of the final exemption to reflect this change. In addition, the Department has deleted the reference to “AMHC's policyholder obligations” in section I(h) of the proposed exemption and has substituted the phrase “AmerUs Life's policyowner obligations.” Further, the Department notes the modification to Representation 18(g) of the Summary.
4.
Therefore, to correct this error, the Applicant requests that the sentence be revised to read as follows: “Section 508B.6 of the Iowa Code requires that the plan of conversion be approved by two-thirds of the policyowners of the mutual company voting on the conversion.”
In response, the Department notes this revision to the Summary.
5.
The Applicant explains that under Section 508B.7 of the Iowa Code, the full legal standard for the Commissioner's approval of the Plan of Conversion is a determination that “the plan complies with all provisions of law, the plan is fair and equitable to the mutual company and its policyholders, and that the reorganized company will have the amount of capital and surplus deemed by the commissioner to be reasonably necessary for its future solvency.” Therefore, the Applicant requests that Section II(b) of the final exemption and Representation 18(b) of the Summary be amended to conform with the Iowa Code.
In response to this comment, the Department has revised Section II(b) of the final exemption to read as follows:
(b) The Commissioner reviews the terms and options that are provided to Eligible Members of AMHC as part of such Commissioner's review of the Plan of Conversion and the Commissioner approves the Plan of Conversion following a determination that such Plan is fair and equitable to Eligible Members.
6.
For further information regarding the comments and other matters discussed herein, interested persons are encouraged to obtain copies of the exemption application file (Exemption Application No. D-10874) the Department is maintaining in this case. The complete application file, as well as all supplemental submissions received by the Department, are made available for public inspection in the Public Documents Room of the Pension and Welfare Benefits Administration, Room N-5638, U.S. Department of Labor, 200 Constitution Avenue, N.W., Washington, D.C. 20210.
Accordingly, after giving full consideration to the entire record, including the written comments, the Department has decided to grant the exemption subject to the modifications and clarifications described above.
Ms. Jan D. Broady of the Department, telephone (202) 219-8881. (This is not a toll-free number.)
The sanctions resulting from the application of section 4975 of the Code, by reason of section 4975(c)(1)(A) through (E) of the Code, shall not apply to the proposed sale of certain unimproved real property (the Land) by the Plan to Richard E. Lobenherz (Mr. Lobenherz), a disqualified person with respect to the Plan,
(a) The proposed sale will be a one-time transaction for cash;
(b) The Plan will receive the current fair market value for the Land established at the time of the sale by a qualified, independent appraiser;
(c) The Plan will pay no real estate expenses or commissions associated with the sale; and
(d) The sale will provide the Plan with greater liquidity and further diversification of the Plan's assets.
For a more complete statement of the facts and representations supporting the Department's decision to grant this exemption, refer to the notice of proposed exemption published on September 22, 2000 at 65 FR 57396.
Ekaterina A. Uzlyan of the Department at (202) 219-8883. (This is not a toll-free number).
The attention of interested persons is directed to the following:
(1) The fact that a transaction is the subject of an exemption under section 408(a) of the Act and/or section 4975(c)(2) of the Code does not relieve a fiduciary or other party in interest or disqualified person from certain other provisions to which the exemptions does not apply and the general fiduciary responsibility provisions of section 404 of the Act, which among other things require a fiduciary to discharge his duties respecting the plan solely in the interest of the participants and beneficiaries of the plan and in a prudent fashion in accordance with section 404(a)(1)(B) of the Act; nor does it affect the requirement of section 401(a) of the Code that the plan must operate for the exclusive benefit of the employees of the employer maintaining the plan and their beneficiaries;
(2) These exemptions are supplemental to and not in derogation of, any other provisions of the Act and/or the Code, including statutory or administrative exemptions and transactional rules. Furthermore, the fact that a transaction is subject to an administrative or statutory exemption is not dispositive of whether the transaction is in fact a prohibited transaction; and
(3) The availability of these exemptions is subject to the express condition that the material facts and representations contained in each application accurately describes all material terms of the transaction which is the subject of the exemption.
Copyright Office, Library of Congress.
Announcement of the schedule for the proceeding.
The Copyright Office of the Library of Congress is announcing the schedule for the 180-day arbitration period for the Phase II distribution of the 1997 cable royalty funds for the syndicated programming category.
November 1, 2000.
All hearings and meetings for the Phase II cable distribution proceeding shall take place in the James Madison Memorial Building, Room LM-414, First and Independence Avenue, SE., Washington, DC 20540.
David O. Carson, General Counsel, or William J. Roberts, Jr., Senior Attorney for Compulsory Licenses, P.O. Box 70977, Southwest Station, Washington, D.C. 20024. Telephone: (202) 707-8380. Telefax: (202) 252-3423.
Section 251.11(b) of the regulations governing the Copyright Arbitration Royalty Panels (“CARPs”), 37 CFR subchapter B, provides that:
At the beginning of each proceeding, the CARP shall develop the original schedule of the proceeding which shall be published in the
This notice fulfills the requirements of § 251.11(b) for the proceeding to determine the Phase II distribution of the 1997 cable royalty funds for the syndicated programming category.
By Order dated January 12, 2000, the Library consolidated all Phase II controversies in Docket Nos. 96-7 CARP CD 93-94, 97-2 CARP CD 95, 98-2 CARP CD 96 and 99-5 CARP CD 97 into a single distribution proceeding and announced the precontroversy discovery schedule for a Phase II distribution proceeding in the syndicated programming category. All controversies in this category have reached settlement, except for a dispute between certain claimants represented by the Independent Producers Group (“IPG”), and certain claimants represented by the Motion Picture Association of America, Inc. (“Program Suppliers”), for distribution of the 1997 royalty funds collected under the cable statutory license of the Copyright Act. 17 U.S.C. 111.
On October 12, 2000, the Office published a notice initiating the 180-day arbitration period for this proceeding. 65 FR 60690 (October 12, 2000). On October 17, 2000, the parties to this proceeding met with the arbitrators for the purposes of discussing resolution of certain issues designated to the CARP by the Copyright Office during the discovery period of the proceeding and of setting a schedule for this proceeding. At that meeting, the parties and the arbitrators agreed to the following briefing and hearing schedule:
At this time, the parties have not moved to close any portion of the proceeding to the public. Further refinements to the schedule will be announced in open meetings and issued as orders to the parties participating in the proceeding. All changes will be noted in the docket file of the proceeding, as required by the Copyright Office regulations governing the administration of CARP proceedings. 37 CFR 251.11(c)
National Aeronautics and Space Administration.
Notice of meeting.
In accordance with the Federal Advisory Committee Act, Public Law 92-463, as amended, the National Aeronautics and Space Administration announces a NASA Advisory Council, Aero-Space Technology Advisory Committee, Aviation Safety Reporting System Subcommittee meeting.
Monday, November 13, 2000, 9 a.m. to 5 p.m.; and Tuesday, November 14, 2000, 9 a.m. to 5 p.m.
Doubletree Hotel, Two Portola Plaza, Monterey, CA 93940.
Ms. Linda Connell, National Aeronautics and Space Administration, Ames Research Center, Moffett Field, CA 94035, 650/960-6059.
The meeting will be open to the public up to the seating capacity of the room. Agenda topics for the meeting are as follows:
It is imperative that the meeting be held on these dates to accommodate the scheduling priorities of the key participants. Visitors will be requested to sign a visitors register.
National Aeronautics and Space Administration.
Notice of prospective patent license.
NASA hereby gives notice that Tektronix, Inc., of Beaverton, OR has applied for an exclusive license to practice the inventions disclosed in U.S. Patent Nos. 5,629,780 and 5,426,512 both entitled “Image Data Compression Having Minimum Perceptual Error” which are assigned to the United States of America as represented by the Administrator of the National Aeronautics and Space Administration. Written objections to the prospective grant of a license should be sent to NASA Ames Research Center.
Responses to this notice must be received by January 2, 2001.
Robert Padilla, Patent Counsel, NASA Ames Research Center, Mail Stop 202A-3, Moffett Field, CA 94035-1000, telephone (650) 604-5104.
Pursuant to delegation by the Commission dated December 29, 1972, published in the
This Board is being established pursuant to the request of First Energy Operating Company, the licensee for the Perry Nuclear Power Plant, for a hearing regarding an Order issued by the Director, Office of Enforcement, dated August 14, 2000, entitled “Order Imposing Civil Monetary Penalty” (65 FR 49,610 (Aug. 14, 2000)).
The Board is comprised of the following administrative judges:
All correspondence, documents and other materials shall be filed with the Judges in accordance with 10 CFR 2.701.
Pursuant to 10 CFR 110.72(j) “Public notice of receipt of an application”, please be advised that the Nuclear Regulatory Commission has received an application to amend import license IW008 as set forth below. Copies of the
A request for a hearing or petition for leave to intervene should be filed within 30 days after publication of this notice in the
The information concerning the amendment application follows.
For the Nuclear Regulatory Commission,
The October 18, 2000,
Inadvertently, this was the second offering of such opportunity as a notice had already been published in the September 27, 2000,
For the Nuclear Regulatory Commission.
Pursuant to Public Law 97-415, the U.S. Nuclear Regulatory Commission (the Commission or NRC staff) is publishing this regular biweekly notice. Public Law 97-415 revised section 189 of the Atomic Energy Act of 1954, as amended (the Act), to require the Commission to publish notice of any amendments issued, or proposed to be issued, under a new provision of section 189 of the Act. This provision grants the Commission the authority to issue and make immediately effective any amendment to an operating license upon a determination by the Commission that such amendment involves no significant hazards consideration, notwithstanding the pendency before the Commission of a request for a hearing from any person.
This biweekly notice includes all notices of amendments issued, or proposed to be issued from October 9, 2000, through October 20, 2000. The last biweekly notice was published on October 18, 2000.
The Commission has made a proposed determination that the following amendment requests involve no significant hazards consideration. Under the Commission's regulations in 10 CFR 50.92, this means that operation of the facility in accordance with the proposed amendment would not (1) involve a significant increase in the probability or consequences of an accident previously evaluated; or (2) create the possibility of a new or different kind of accident from any accident previously evaluated; or (3) involve a significant reduction in a margin of safety. The basis for this proposed determination for each amendment request is shown below.
The Commission is seeking public comments on this proposed determination. Any comments received within 30 days after the date of publication of this notice will be considered in making any final determination.
Normally, the Commission will not issue the amendment until the expiration of the 30-day notice period. However, should circumstances change during the notice period such that failure to act in a timely way would result, for example, in derating or shutdown of the facility, the Commission may issue the license amendment before the expiration of the 30-day notice period, provided that its final determination is that the amendment involves no significant hazards consideration. The final determination will consider all public and State comments received before action is taken. Should the Commission take this action, it will publish in the
Written comments may be submitted by mail to the Chief, Rules Review and Directives Branch, Division of Administration Services, Office of Administration, U.S. Nuclear Regulatory
By December 1, 2000, the licensee may file a request for a hearing with respect to issuance of the amendment to the subject facility operating license and any person whose interest may be affected by this proceeding and who wishes to participate as a party in the proceeding must file a written request for a hearing and a petition for leave to intervene. Requests for a hearing and a petition for leave to intervene shall be filed in accordance with the Commission's “Rules of Practice for Domestic Licensing Proceedings” in 10 CFR Part 2. Interested persons should consult a current copy of 10 CFR 2.714 which is available at the Commission's Public Document Room, located at One White Flint North, 11555 Rockville Pike (first floor), Rockville, Maryland 20852. Publicly available records will be accessible and electronically from the ADAMS Public Library component on the NRC Web site,
As required by 10 CFR 2.714, a petition for leave to intervene shall set forth with particularity the interest of the petitioner in the proceeding, and how that interest may be affected by the results of the proceeding. The petition should specifically explain the reasons why intervention should be permitted with particular reference to the following factors: (1) The nature of the petitioner's right under the Act to be made a party to the proceeding; (2) the nature and extent of the petitioner's property, financial, or other interest in the proceeding; and (3) the possible effect of any order which may be entered in the proceeding on the petitioner's interest. The petition should also identify the specific aspect(s) of the subject matter of the proceeding as to which petitioner wishes to intervene. Any person who has filed a petition for leave to intervene or who has been admitted as a party may amend the petition without requesting leave of the Board up to 15 days prior to the first prehearing conference scheduled in the proceeding, but such an amended petition must satisfy the specificity requirements described above.
Not later than 15 days prior to the first prehearing conference scheduled in the proceeding, a petitioner shall file a supplement to the petition to intervene which must include a list of the contentions which are sought to be litigated in the matter. Each contention must consist of a specific statement of the issue of law or fact to be raised or controverted. In addition, the petitioner shall provide a brief explanation of the bases of the contention and a concise statement of the alleged facts or expert opinion which support the contention and on which the petitioner intends to rely in proving the contention at the hearing. The petitioner must also provide references to those specific sources and documents of which the petitioner is aware and on which the petitioner intends to rely to establish those facts or expert opinion. Petitioner must provide sufficient information to show that a genuine dispute exists with the applicant on a material issue of law or fact. Contentions shall be limited to matters within the scope of the amendment under consideration. The contention must be one which, if proven, would entitle the petitioner to relief. A petitioner who fails to file such a supplement which satisfies these requirements with respect to at least one contention will not be permitted to participate as a party.
Those permitted to intervene become parties to the proceeding, subject to any limitations in the order granting leave to intervene, and have the opportunity to participate fully in the conduct of the hearing, including the opportunity to present evidence and cross-examine witnesses.
If a hearing is requested, the Commission will make a final determination on the issue of no significant hazards consideration. The final determination will serve to decide when the hearing is held.
If the final determination is that the amendment request involves no significant hazards consideration, the Commission may issue the amendment and make it immediately effective, notwithstanding the request for a hearing. Any hearing held would take place after issuance of the amendment.
If the final determination is that the amendment request involves a significant hazards consideration, any hearing held would take place before the issuance of any amendment.
A request for a hearing or a petition for leave to intervene must be filed with the Secretary of the Commission, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, Attention: Docketing and Services Branch, or may be delivered to the Commission's Public Document Room, the Gelman Building, 2120 L Street, NW., Washington, DC by the above date. A copy of the petition should also be sent to the Office of the General Counsel, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, and to the attorney for the licensee.
Nontimely filings of petitions for leave to intervene, amended petitions, supplemental petitions and/or requests for a hearing will not be entertained absent a determination by the Commission, the presiding officer or the Atomic Safety and Licensing Board that the petition and/or request should be granted based upon a balancing of factors specified in 10 CFR 2.714(a)(1)(i)-(v) and 2.714(d).
For further details with respect to this action, see the application for amendment which is available for public inspection at the Commission's Public Document Room, located at One White Flint North, 11555 Rockville Pike (first floor), Rockville, Maryland 20852. Publicly available records will be accessible and electronically from the ADAMS Public Library component on the NRC Web site,
1. The proposed change does not involve a significant increase in the probability or consequences of an accident previously evaluated.
The proposed change does not affect accident initiators. The change in RCS [reactor coolant system] volume, an input in certain accident analyses, is acceptable since applicable acceptance criteria continue to be met. The change to the calculated residual heat removal (RHR) cooldown time does not adversely impact safe shutdown and meets Standard Review Plan (SRP) requirements. The analysis results for peak accident pressure (P
The leak rate assumed in accident analyses is conservative and independent of the value of P
HNP [Harris Nuclear Plant] structures, systems and components, as well as the RSGs, are designed to operate at the original T
The RSGs are designed to minimize potential for the types of tube degradation experienced with the OSGs [original steam generators]. The changes to reactor core safety limits, RTS/ESFAS [reactor trip system/engineered safety feature actuation system] values and T
The proposed change reduces Technical Specification limits on reactor coolant activity to ensure that the dose consequences of the proposed new SGTR [steam generator tube rupture] analysis meet guidelines. The Technical Specification limits are not accident initiators and the proposed change provides additional conservatism in the limiting initial condition for RCS activity level. The change in these limits functions only to mitigate consequences of RCS liquid and steam release events and does not impact methods for plant operation. Since there are no adverse impacts to initiators of accidents previously evaluated, there is no significant increase in the probability of such accidents.
The proposed change to the basis for thyroid dose conversion factors is an accepted update to that used in the analysis of record. Dose consequences for all analyses, including SGTR, remain within allowable guidelines. Although there are increases to previously reported dose consequences, the increase is not significant since the results remain under the SRP acceptance criteria.
Reducing the required time at hot standby to maintain adequate CST [condensate storage tank] minimum volume ensures accident mitigation capability and is not involved with accident initiation. Conservative reactor trip setpoints during power operation with inoperable main steam line safety valves ensure accident analysis assumptions for maximum secondary system pressure. The proposed setpoint changes are also unrelated to initiation of previously evaluated accidents.
The removal of F* plugging criteria is consistent with NUREG-0452, “Standard Technical Specifications.” The remaining Technical Specification plugging criterion is based on a minimum wall thickness due to wastage as determined by ASME [American Society of Mechanical Engineers] Section XI. The proposed change is conservative because operation with F* degraded tubes is eliminated.
The potential for a tube rupture is expected to be acceptably low based on the qualification analysis and testing for the RSGs. The proposed program for periodic in-service inspection monitors the integrity of the SG tubing to provide reasonable assurance that there is sufficient time to take proper and timely corrective action if any tube degradation is detected. The deleted OSG tube inspection requirements are not applicable to the RSG due to design differences.
SG tube inspections are not accident initiators and the function of the inspection program is to identify and eliminate, when appropriate, accident precursor conditions. Because of this, the probability of postulated accidents (
Since the proposed changes are either conservative (reduced RTS setpoints, elimination of F* tube plugging criteria) or related to mitigation of postulated accidents (hot standby time prior to cooldown), there is no significant increase in dose consequences.
Therefore, the proposed change does not involve a significant increase in the probability or consequences of an accident previously evaluated.
2. The proposed change does not create the possibility of a new or different kind of accident from any accident previously evaluated.
The proposed change does not adversely impact methods of plant operation and new methods of plant systems operation are not created. The impacts of SG replacement on NSSS [nuclear steam supply system] and other plant systems, including the change in RCS volume and other design differences, have been evaluated and design and performance requirements continue to be met. Accordingly, no new accident scenarios, failure mechanisms or limiting single failures are introduced.
Changing P
Since HNP structures, systems and components are designed for operation at the proposed T
The proposed change to specific activity limits does not modify plant systems,
No new types of failures and no new or different accident initiators are created. As a result, the change will not introduce significant or adverse changes to the plant design basis that could lead to the creation of a new or different kind of accident.
The revised thermal power restrictions imposed by [the] Technical Specification[s] when there are inoperable main steam line safety valves are conservative and consistent with the Technical Specification Bases methodology. The reduction in hot standby time to six hours continues to satisfy requirements for safe shutdown. No new failure mechanisms or limiting single failures are introduced and there are no adverse effects or challenges to the performance or integrity of safety related systems.
Removing application of F* repair criteria and sleeving methodologies from [the] Technical Specification[s] with the RSGs does not introduce significant or adverse changes to the plant design basis that could lead to a new or different kind of accident being created. These requirements were needed to address design and material conditions of the original HNP SGs that are not applicable to the RSGs. This change does not alter the objective of SG surveillance activities—maintaining the structural integrity of this portion of the reactor coolant system. The surveillance activities are performed during outages and the proposed surveillance program is consistent with regulatory guidance. No new failures are created.
Therefore, the proposed change does not create the possibility of a new or different kind of accident from any previously evaluated.
3. The proposed change does not involve a significant reduction in a margin of safety.
Analyses supporting the change reflect the RSG design, including changes to primary and secondary volume and minimum water level for adequate heat sink. Mass and energy and containment response analyses model ESF [engineered safety features] systems and safety analysis limits. The analysis results demonstrate that applicable acceptance criteria, including DNB, RCS pressure, peak cladding temperature, containment pressure and temperature, and dose, continue to be met.
The calculated containment peak accident pressures result in a value of P
All evaluations and analyses performed to support SG replacement reflect the proposed values. The results demonstrate that applicable acceptance criteria (including DNB, RCS pressure and temperature, LOCA [loss-of-coolant accident] peak clad temperature, containment pressure and temperature, and dose) continue to be met. Calculations confirm that the proposed RTS/ESFAS values provide margin to the safety analysis limits, thereby ensuring that the margin of safety inherent in the safety analysis limit itself is preserved.
The specific activity limit has no effect on safety limits or limiting safety system settings. The only impact of the specific activity limits is on dose consequences for certain design basis accidents such as SGTR. The proposed change is in the conservative direction for dose. The SGTR analysis is the most limiting of these accident dose evaluations. The proposed new analysis demonstrates that the SGTR consequences remain within allowable SRP guideline limits, which establish the margin of safety. Since the analysis results remain below the SRP guidelines, the margin of safety is not reduced.
The thermal power restrictions imposed by [the] Technical Specification[s] when there are inoperable main steam line safety valves [ensure] sufficient relieving capacity during all postulated transients, thereby maintaining margin of safety for secondary system pressure.
The proposed in-service inspection program for the RSGs monitors the integrity of the SG tubing and is consistent with NUREG-0452. Since the F* repair criteria and sleeving methods specifically addressed OSG degradation issues, their removal does not involve a reduction in a margin of safety. Analyses demonstrate that the RSG tubing retains adequate structural and leakage integrity using the proposed plugging criteria during normal, transient, and postulated accident conditions. The RSG tubing design and proposed plugging criteria are consistent with applicable ASME requirements and do not allow for operation with indications identified by F* criteria.
The proposed plugging limit maintains the margin of safety by providing for leakage detection and shutdown in the event of an unexpected tube leak while minimizing the potential for excessive leakage or tube burst in the event of [an] MSLB [main steam line break] or LOCA.
Therefore, the proposed change does not involve a significant reduction in a margin of safety.
The NRC staff has reviewed the licensee's analysis and, based on this review, it appears that the three standards of 10 CFR 50.92(c) are satisfied. Therefore, the NRC staff proposes to determine that the amendment request involves no significant hazards consideration.
1. The proposed change does not involve a significant increase in the probability or consequences of an accident previously evaluated.
The proposed changes revise the pressure drop acceptance criteria of TS Section 5.5.7.d from “6.0 inches WG” to “3.0 inches WG” for the CREF makeup train, and from “8.0 inches WG” to “4.2 inches WG” for the CREF recirculation train. The change in pressure drop reflects the impact of reduced fan speed on system characteristics. The removal of “(CREF only)” is editorial and clarifies the inclusion of the SGTS prefilters in the VFTP. These changes assure that the Surveillance procedure appropriately demonstrate[s] the ability of the CREF trains to perform its specified function.
No changes in either system design or operating strategies will be made as a result of these changes. Thus, no opportunity exists to increase the probability or consequences of a previously analyzed accident. Therefore, the proposed change does not involve a significant increase in the probability or consequences of a previously evaluated accident.
2. The proposed change does not create the possibility of a new or different kind of accident from any accident previously evaluated.
The proposed change does not involve a change to the plant operation. As a result, the proposed change does not affect any of the parameters or conditions that could contribute to the initiation of any accidents. This change involves the pressure drop across the filters and adsorbers of the CREF make-up and recirculation trains. The
No new accident scenarios are created by the lower value of filter and adsorber pressure drop. No safety-related equipment or safety functions are altered as a result of this change. Additionally, the removal of “(CREF only)” is editorial and clarifies the inclusion of the SGTS prefilters in the VFTP. Therefore, the changes do not create the possibility of a new or different kind of accident or malfunction from those previously analyzed.
3. The change does not involve a significant reduction in the margin of safety.
The proposed change in combination with existing restrictions within the TS provides assurance that there are no credible mechanisms to prevent the CCHVAC [control center heating, ventilation, and air conditioning] system from performing its specified function. The maximum allowable differential pressure is more restrictive and corresponds to the reduced fan speed across the HEPA filters, prefilters, and charcoal adsorbers as a result of this change. There will be no changes in system operating strategies because of the inclusion of the make-up moisture separator/prefilter and test acceptance criteria for the CREF trains. Additionally, the removal of “(CREF only)” is editorial and clarifies the inclusion of the SGTS prefilters in the VFTP. Therefore, the proposed change does not involve a significant reduction in the margin of safety.
The NRC staff has reviewed the licensee's analysis and, based on this review, it appears that the three standards of 10 CFR 50.92(c) are satisfied. Therefore, the NRC staff proposes to determine that the amendment request involves no significant hazards consideration.
1. Will the change involve a significant increase in the probability or consequence of an accident previously evaluated?
No. The proposed amendment to the FOLs are either administrative, eliminate duplication of other regulatory requirements or delete License Conditions fully met by Duke Energy Corporation. No actual plant equipment, operating practices, or accident analyses are affected by this proposed amendment. Therefore, the proposed amendment has no impact on the possibility of any type of accident: new, different, or previously evaluated.
2. Will the change create the possibility of a new or different kind of accident from any previously evaluated?
No. The proposed amendment to the FOLs [are] either administrative, eliminate duplication of other regulatory requirements or delete License Conditions fully met by Duke Energy Corporation. No actual plant equipment, operating practices, or accident analyses are affected by this proposed amendment and no failure modes not bounded by previously evaluated accidents are created. Therefore, the proposed amendment has no impact on the possibility of any type of accident: new, different, or previously evaluated.
3. Will the change involve a significant reduction in a margin of safety?
No. Margin of safety is associated with confidence in the ability of the fission product barriers (
The NRC staff has reviewed the licensee's analysis and, based on this review, it appears that the three standards of 10 CFR 50.92(c) are satisfied. Therefore, the NRC staff proposes to determine that the amendment request involves no significant hazards consideration.
1. Does the change involve a significant increase in the probability of consequences of an accident previously evaluated?
No. The proposed change modifies the allowed outage time that a channel of the Refueling Water Storage Tank (RWST) can be in the tripped condition from an indefinite period of time to a more conservative maximum of 48 hours. The Engineered Safety Features Actuation System (ESFAS) is an accident mitigating system, and not an accident initiator. Therefore, the proposed change will have no impact on any accident probabilities. Accident consequences will not be affected, as no changes are being made to the plant involving a reduction in reliability or effectiveness of the Emergency Core Cooling System (ECCS). Consequently, any previous evaluations associated with accidents will not be affected by this change.
2. Does the change create the possibility of a new or different kind of accident from any accident previously evaluated?
No. The proposed change does not modify the design or configuration of the plant. The proposed change provides a more conservative time limit for a channel to be in the tripped condition. No physical changes are being made to plant systems, structures or components nor will the proposed change reduce the ability of any of the safety related equipment required for accident mitigation. Consequently, this change does not create the possibility of a new or different kind of accident from any previously evaluated.
3. Does this change involve a significant reduction in a margin of safety?
No. Margin of safety is related to the confidence in the ability of the fission product barriers to perform their design functions during and following accident conditions. These barriers include the fuel cladding, the reactor coolant system, and the containment system. The proposed change provides a more restrictive time limit for a channel of the RWST to be in a tripped condition than is currently allowed by the ITS. The performance of the fission product barriers will not be degraded by the proposed changes. Consequently, plant safety analyses will not be affected.
The NRC staff has reviewed the licensee's analysis and, based on this review, it appears that the three
The proposed changes do not involve a significant increase in the probability or consequences of an accident previously evaluated.
Pressure-temperature (P/T) limits (Pilgrim Technical Specifications Figures 3.6.1, 3.6.2, and 3.6.3) are imposed on the reactor coolant system to ensure that adequate safety margins against nonductile or rapidly propagating failure exist during normal operation, anticipated operational occurrences, and system hydrostatic tests. The P/T limits are related to the nil-ductility reference temperature, RTndt, as described in American Society of Mechanical Engineers (ASME) Section III, Appendix G. Changes in the fracture toughness properties of reactor pressure vessel (RPV) beltline materials, resulting from the neutron irradiation and the thermal environment, are monitored by a surveillance program in compliance with the requirements of 10 CFR Part 50, Appendix H. The effect of neutron fluence on the shift in the nil-ductility reference temperature of pressure vessel steel is predicted by methods given in Regulatory Guide (RG) 1.99, Revision 2.
The proposed change is a revision of the second surveillance capsule withdrawal time, identified in Technical Specification Table 4.6-3, from approximately 18 effective full power years (EFPY) to approximately 21 EFPY. This change will not affect P/T limits as given in Pilgrim Technical Specifications Figures 3.6.1, 3.6.2, and 3.6.3. This change is not related to any accidents previously evaluated. This change will not affect any plant safety limits or limiting conditions of operation. The proposed change will not affect reactor pressure vessel performance because no physical changes are involved and Pilgrim vessel P/T limits will remain in accordance with RG 1.99, Revision 2 requirements. The proposed change will not cause the reactor pressure vessel or interfacing systems to be operated outside of their design or testing limits. Also, the proposed change will not alter any assumptions previously made in evaluating the radiological consequences of accidents.
Therefore, the probability or consequences of accidents previously evaluated will not be increased by the proposed change.
The proposed changes do not create the possibility of a new or different kind of accident from any accident previously evaluated.
The proposed change revises the second RPV material surveillance capsule withdrawal time in Pilgrim Technical Specification Table 4.6-3 from approximately 18 EFPY to approximately 21 EFPY. This proposed change does not involve a modification of the design of plant structures, systems, or components (SSCs). The proposed change will not impact the manner in which the plant is operated as plant operating and testing procedures will not be affected by the change. The proposed change will not degrade the reliability of SSCs important to safety because equipment protection features will not be deleted or modified, equipment redundancy or independence will not be reduced, supporting system performance will not be downgraded, the frequency of operation of equipment important to safety will not be increased, and increased or more severe testing of equipment important to safety will not be imposed. No new accident types or failure modes will be introduced as a result of the proposed change. Therefore, the proposed change does not create the possibility of a new or different kind of accident from that previously evaluated.
The proposed changes do not involve a significant reduction in a margin of safety.
Operation in accordance with the existing P-T curves ensures reactor vessel and cooling system integrity. The capsule pull is a surveillance technique that provides data for modification of the curves. The margins will not change without new data from the capsule pull. The NRC-approved methods used to develop the temperatures associated with the current curves reside in Pilgrim's TSs and have been determined to be conservative. The proposed change will not affect any safety limits, limiting safety system settings, or limiting conditions of operation. The proposed change does not represent a change in initial conditions, or in a system response time, or in any other parameter affecting the course of an accident analysis supporting the Bases of any Technical Specification. Therefore, the proposed changes do not involve a significant reduction in any margins of safety.
Based on the staff's analysis, it appears that the three standards of 50.92(c) are satisfied. Therefore, the NRC staff proposes to determine that the amendment request involves no significant hazards consideration.
The Davis-Besse Nuclear Power Station (DBNPS) has reviewed the proposed changes and determined that a significant hazards consideration does not exist because operation of the Davis-Besse Nuclear Power Station, Unit No. 1, in accordance with these changes would:
1a. Not involve a significant increase in the probability of an accident previously evaluated because no such accidents are affected by the proposed changes. The amendment application proposes to revise Technical Specification (TS) Bases 3/4.3.1 and 3/4.3.2, Reactor Protection System and Safety System Instrumentation, to clarify Steam and Feedwater Rupture Control System (SFRCS) requirements; to add new TS 3/4.7.1.8, Main Feedwater Control Valves (MFCVs) and Startup Feedwater Control Valves (SFCVs); to add new TS 3/4.7.1.9, Turbine Stop Valves (TSVs); and to make associated changes to the Bases and TS Index.
The proposed change would provide clear guidance for the actions required when SFRCS logic and SFRCS-actuated components are inoperable. The new TSs for MFCVs, SFCVs, and TSVs provide appropriate operational requirements for these SFRCS-actuated components. The proposed change will not change any system hardware or testing requirements. Initiating conditions and assumptions remain as previously analyzed for accidents in the DBNPS Updated Safety Analysis Report (USAR). The proposed changes to the TS Bases and Index are consistent with the changes described above.
The proposed changes are consistent with the intent of NUREG-1430, “Standard Technical Specifications—Babcock and Wilcox Plants,” Revision 1, April 1995. The proposed change does not involve a change to any plant hardware and does not affect the probability of any equipment malfunction or accident-initiating event.
1b. Not involve a significant increase in the consequences of an accident previously evaluated because the source term, containment isolation, or radiological releases are not affected by the proposed changes. The proposed changes ensure that excessive unavailability of SFRCS-actuated equipment which is used to mitigate accident consequences does not occur. The reliability of the plant hardware and the ability of the SFRCS-actuated equipment to perform its safety function are not affected. Existing system and component redundancy is not affected by the proposed changes. The existing system and component operation is not affected by the proposed changes, and the assumptions used in evaluating the radiological consequences in the DBNPS USAR are not invalidated. Therefore, for each postulated accident the consequences remain bounded by the consequences from the previously evaluated accidents.
2. Not create the possibility of a new or different kind of accident from any accident previously evaluated because these proposed changes do not involve any physical changes to systems or components, nor do they alter the manner in which the systems or components are operated.
3. Not involve a significant reduction in a margin of safety because, for the proposed changes, there are no new or significant changes to the initial conditions contributing to accident severity or consequences. Accordingly, there are no significant reductions in a margin of safety.
On the basis of the above, the DBNPS has determined that the License Amendment Request does not involve a significant hazards consideration. As this License Amendment Request concerns a proposed change to the Technical Specifications that must be reviewed by the Nuclear Regulatory Commission, this License Amendment Request does not constitute an unreviewed safety question.
The NRC staff has reviewed the licensee's analysis and, based on this review, it appears that the three standards of 10 CFR 50.92(c) are satisfied. Therefore, the NRC staff proposes to determine that the amendment request involves no significant hazards consideration.
1. The proposed amendment will not involve a significant increase in the probability or consequences of an accident previously evaluated.
The current TS SRs ensure acceptable SLC boron solution volume and concentration values which produce a minimum boron concentration of 600 ppm in the reactor. This proposed amendment revises the boron solution requirements to ensure a minimum boron concentration of 660 ppm in the reactor. A minimum boron concentration of 660 ppm in the reactor is sufficient to initiate and maintain reactor subcriticality as the nuclear system cools. The DAEC is currently pursuing the use of GE-14 fuel, power uprate to 1912 MWth and extended cycle length. Increasing the minimum boron concentration to 660 ppm in the reactor will provide adequate shutdown margin for these future core designs. A General Electric analysis, using the approved methods described in Revision 14 of General Electric Standard Application for Reactor Fuel (GESTAR II), NEDE 24011-P-A, provides the basis for the increase in minimum boron concentration. This analysis assumes DAEC operation with an equilibrium core of GE-14 fuel, operating at 1912 MWth with 24 month cycles and bounds all planned future core designs.
The concentration requirement of the SLC boron solution will continue to comply with the requirements of 10 CFR 50.62(c)(4).
The proposed editorial change to the title of TS Figure 3.1.7-1 provides clarity only and does not alter performance of TS SR 3.1.7.1 and SR 3.1.7.5.
Therefore, this proposed amendment will not involve a significant increase in the probability or consequences of an accident previously evaluated.
2. The proposed amendment will not create the possibility of a new or different kind of accident from any accident previously evaluated.
Ensuring a minimum boron concentration of 660 ppm in the reactor will result in an increase in the acceptable minimum volume of boron solution in the SLC tank. The tank can accept the increased volume of boron solution. The tank low and high level alarms will be altered; these alarms alert the operator to take action in the event boron solution volume is decreasing or increasing, respectively. Increasing the volume in the SLC tank and increases to the low and high level alarm setpoints will have no effect on operator actions to maintain system operability. Revising the SLC boron solution requirements to ensure a minimum boron concentration of 660 ppm in the reactor cannot create a new or different kind of accident.
The proposed editorial change to the title of TS Figure 3.1.7-1 provides consistent wording between the Figure, TS SR 3.1.7.1 and the TS BASES to avoid potential inconsistencies when determining the tank volume acceptability.
Therefore this proposed amendment will not create the possibility of a new or different
3. The proposed amendment will not involve a significant reduction in a margin of safety.
DAEC TS SRs ensure SLC boron solution volume and concentration values which produce a minimum boron concentration of 600 ppm in the reactor. This proposed amendment revises SLC boron solution requirements to ensure a minimum boron concentration of 660 ppm in the reactor. A boron concentration of 660 ppm in the reactor is sufficient to initiate and maintain reactor subcriticality as the nuclear system cools. The DAEC is currently pursuing the use of GE-14 fuel, power uprate to 1912 MWth and extended cycle length. A General Electric (GE) analysis, using the approved methods described in Revision 14 of General Electric Standard Application for Reactor Fuel (GESTAR II), NEDE 24011-P-A, provides the basis for the increase in minimum boron concentration. GE's analysis demonstrated that at a minimum boron concentration of 600 ppm in the reactor, the SLC shutdown margin was marginal with respect to the TS requirement for shutdown margin. At a minimum boron concentration of 660 ppm in the reactor, sufficient margin is maintained such that TS Section 3.1.1 will be met under all anticipated conditions. The GE analysis assumes DAEC operation with an equilibrium core of GE-14 fuel, operating at 1912 MWth with 24 month cycles and bounds all planned future core designs.
The concentration requirement of the SLC boron solution will continue to comply with the requirements of 10 CFR 50.62(c)(4).
The SLC system is designed to inject a quantity of boron that produces a minimum boron concentration of 600 ppm in the reactor. An additional 25% of that quantity of boron is also injected to compensate for imperfect mixing, leakage and volume in other small piping connected to the reactor. This margin will be maintained such that an additional 25% of the quantity of boron required to achieve a minimum boron concentration of 660 ppm in the reactor will also be injected. Therefore, this proposed amendment will not involve a significant reduction in a margin of safety.
The proposed editorial change to the title of TS Figure 3.1.7-1 provides consistent wording between the Figure, TS SR 3.1.7.1 and the TS BASES to avoid potential inconsistencies when determining tank volume acceptability.
The NRC staff has reviewed the licensee's analysis and, based on this review, it appears that the three standards of 10 CFR 50.92(c) are satisfied. Therefore, the NRC staff proposes to determine that the amendment request involves no significant hazards consideration.
The operation of the unit in accordance with the proposed amendment will not involve a significant increase in the probability or consequences of an accident previously evaluated.
The proposed TS changes will result in not requiring containment integrity, but requiring reactor building integrity (secondary containment) during performance of the specified tests. These are changes in configuration (no hardware design change is involved) to permit testing of various systems or components under different conditions. The changed conditions are not considered precursor of accidents. Accordingly, the probability of an accident previously evaluated is not increased.
Accidents could occur during a test. As part of the proposed TS change, the licensee proposed to limit the dose-equivalent iodine level to ensure that the consequences of possible accidents will continue to be bounded by a previously analyzed accident, the main steam line break accident. Thus, there will not be any increase in the consequences of an accident previously evaluated.
The operation of the unit in accordance with the proposed amendment will not create the possibility of a new or different kind of accident from any accident previously evaluated. No hardware design change is involved with the proposed TS changes. Other than the changes in the configuration of the containment, the reactor building, and the permissible dose-equivalent iodine level, there are no other procedural changes. Therefore, the proposed amendment will not create the possibility of a new or different kind of accident from any previously evaluated.
The operation of the unit in accordance with the proposed amendment will not involve a significant reduction in a margin of safety.
The proposed TS changes will not adversely affect the performance characteristics and intended functions of systems and components covered by the above-listed TS sections. The tests, not affected by the proposed amendment, will ensure the ability of the subject systems and components to perform their intended function. Therefore, the proposed changes do not involve a significant reduction in a margin of safety.
Based on this review, it appears that the three standards of 10 CFR 50.92(c) are satisfied. Therefore, the NRC staff proposes to determine that the amendment request involves no significant hazards consideration.
1. Involve a significant increase in the probability or consequences of an accident previously evaluated.
The offsite circuits supply power to equipment required to support the safe shutdown and post-accident operations of MP2. The preferred off-site power supply is from the 345 kV [kilovolt] switchyard, through the reserve station service transformer (RSST). The alternate (delayed) source of offsite power is the 4.16 kV cross-tie from MP1 via bus 14H.
To ensure that the probability of a complete loss of offsite power is not significantly increased, the MP1 4.16 kV cross-tie will only be removed from service when the weather conditions and forecast are favorable. Additionally, during the time that the alternate offsite source is inoperable, actions will be taken to protect the operable offsite circuit (i.e., no work will be conducted that could challenge the operability of the offsite circuit).
Although the offsite circuits provide power to components that help mitigate the consequences of accidents previously evaluated, the extension in the AOT does not affect any of the assumptions used in the deterministic evaluations of these accidents. Thus, this change will not increase the consequences of any accident previously analyzed.
Based on the above, the proposed change does not involve a significant increase in the probability or consequences of an accident previously analyzed.
2. Create the possibility of a new or different kind of accident from any accident previously evaluated.
The proposed change is an extension to a TS AOT. It does not alter the physical design, configuration, or method of operation of the plant. Therefore, the proposed change will not create the possibility of a new or different kind of accident from any previously analyzed.
3. Involve a significant reduction in a margin of safety.
During the implementation of the modification to provide MP2 with a 4.16 kV cross-tie with MP3, NNECO will:
a. Appropriately consider the 7 day and 14 day weather forecasts prior to removing the MP2 4.16 kV cross-tie with MP1 from service to minimize the potential for loss of offsite power due to severe weather or salt spray.
b. Protect the equipment redundant to the systems removed from service or whose power supply is affected by the modification. This includes limiting work on the 345 kV lines, the switchyard, the RSST, the diesel generators, the service water system, the high pressure safety injection system, and the reactor building closed cooling water system. This restriction will ensure that MP2 will remain capable of mitigating any potential design basis accident during the implementation of the modification.
c. Within 7 days of entering Action a. of TS 3.8.1.1, establish the capability to supply MP2 with power from the MP3 SBO DG via operator actions within one hour of an event resulting in a loss of the remaining offsite source of power. The capability to utilize the MP3 SBO DG is a contingency measure (i.e., will be able to serve as a temporary diesel).
Additionally, NNECO has evaluated the dominant sequences affecting plant risk using probabilistic safety analysis techniques. The analysis determined that the Delta Core Damage Probability associated with the extended allowed outage time was small.
There will be no significant reduction in a margin of safety because the increased risk is acceptable, focus on maintaining the operability of the redundant equipment and systems will be increased, the probable weather conditions will be appropriately considered, and the capability to supply MP2 with power from the MP3 SBO DG via operator action will be established within 7 days of entering Action a. of TS 3.8.1.1. The capability to utilize the MP3 SBO DG is a contingency measure (i.e., will be able to serve as a temporary diesel).
The NRC staff has reviewed the licensee's analysis and, based on this review, it appears that the three standards of 10 CFR 50.92(c) are satisfied. Therefore, the NRC staff proposes to determine that the amendment request involves no significant hazards consideration.
1. Involve a significant increase in the probability or consequences of an accident previously evaluated.
The test that will be performed to verify the ability of the cross-tie to supply approximately 3 MVA of power from MP3 to MP2 will require parallel operation of the MP3 SBO [station blackout] DG [diesel generator] with the MP2 4160 Volt system. To ensure that the MP3 SBO DG and associated connection will be isolated immediately should any abnormal event or failure occur at MP2, a special Class 1E instantaneous overcurrent relaying scheme will be used. This will provide additional assurance that if a fault occurs in the MP3 SBO DG or the associated cross-tie cabling, it will be isolated immediately and should not affect operability of the MP2 safety related 4160 Volt system. In addition, if a
The performance of this test does not significantly alter the manner in which the plant is operated. There will be no adverse effect on plant operation or accident mitigation equipment. The response of the plant and the operators following a design basis event will not be significantly different. Therefore, the proposed activity does not involve a significant increase in the probability or consequences of an accident previously evaluated.
2. Create the possibility of a new or different kind of accident from any accident previously evaluated.
The installation of the Class 1E instantaneous overcurrent relay scheme to be used during performance of this test will provide additional assurance that the MP2 safety related/busses will remain operable during the test to parallel the MP3 SBO DG to the MP2 4160 Volt system. The failure of the temporary overcurrent protection scheme would have the same effect as failure of the existing overcurrent protection scheme. Therefore, the proposed activity does not create the possibility of a new or different kind of accident from any accident previously evaluated.
3. Involve a significant reduction in a margin of safety.
The installation of the Class 1E instantaneous overcurrent relay scheme to be used during performance of this test will provide additional assurance that the MP2 safety related busses will remain operable during the test to parallel the MP3 SBO DG to the MP2 4160 Volt system. This will provide additional assurance that if a fault occurs in the MP3 SBO DG or the associated cross-tie cabling, it will be isolated immediately and should not affect operability of the MP2 safety related 4160 Volt system. In addition, if a loss of normal power occurs at MP2 during the test, the undervoltage condition will be detected by the credited undervoltage scheme, and MP2 will respond as designed to the loss of power.
The proposed activity will have no adverse effect on plant operation or equipment important to safety. The plant response to the design basis accidents will not change and the accident mitigation equipment will continue to function as assumed in the design basis accident analysis. Therefore, the proposed activity does not involve a significant reduction in a margin of safety.
1. Involve a significant increase in the probability or consequences of an accident previously evaluated.
The MP3 to MP2 4160 Volt cross-tie will impose up to an additional 3 MVA load on MP3. As a result, the minimum acceptable switchyard voltage for MP3 will increase from 334 kV to 337 kV. The analysis performed to support the new design shows that, with a minimum voltage of 337 kV in the switchyard, MP3 will remain connected to offsite power. The minimum voltage protection assures that acceptable starting and running voltages are present for the safety systems that may be required to operate should a loss of coolant accident (limiting design basis event) occur at MP3 while MP2 is being supplied with the safe shutdown load of 3 MVA from either the MP3 RSST [reserve station service transformer] or the MP3 NSST [normal station service transformer]. Thus, the MP3 offsite connection will not be tripped when offsite power is available.
The extra loading imposed by the MP2 safe shutdown loads on the MP3 power supplies is within the MP3 capability to simultaneously supply the worst case MP3 normal and accident loads. The ability of MP3 to mitigate design basis accidents and events is not adversely affected by the new design.
This activity does not significantly alter the manner in which the plant is operated. There will be no adverse effect on plant operation or accident mitigation equipment. Also, the response of the plant and the operators following a design basis event will not be significantly different. Therefore, this activity does not involve a significant increase in the probability or consequences of an accident previously evaluated.
The proposed design change will allow the MP3 RSST (or the MP3 NSST, if the MP3 RSST is unavailable) to provide the alternate offsite source for MP2 to meet GDC [General Gesign Criterion] 17 requirements. If the MP3 RSST is not available, MP2 will need to credit the MP3 NSST as the alternate offsite power supply for GDC 17 compliance. The connection for the MP3 NSST is between breakers 13T and 14T. This connection point only provides 1 breaker separation (13T) between the MP2 RSST and the MP3 NSST. If breaker 13T is closed, this arrangement does not provide adequate separation between the two offsite sources as required by GDC 17. Opening breaker 13T when MP3 is shutdown will provide the required separation for MP2, but it will reduce the reliability of the offsite supply for MP3. Therefore, opening the 13T breaker to allow MP2 to meet GDC 17 requirements increases the probability of a loss of offsite power at MP3 when shutdown.
A loss of offsite power at MP3 due to a fault in the offsite distribution network is a low probability event. When combined with the expected frequency of removing the MP3 RSST from service of once per MP3 refueling outage, the probability of a loss of offsite power at MP3 when shutdown as a result of breaker 13T being open is low. In addition, the MP3 shutdown risk program will evaluate the impact of removing the MP3 RSST from service, and plan accordingly. This will ensure the MP3 RSST will be removed from service when the shutdown risk is determined to be acceptably low. Also, at least one MP3 EDG will be available, as required by Technical Specifications, to supply power to necessary loads if offsite power is lost.
This activity does not significantly alter the manner in which the plant is operated. There will be no adverse effect on accident mitigation equipment.
Also, the response of the plant and the operators following a design basis event will not be significantly different. Therefore, this activity does not involve a significant increase in the probability or consequences of an accident previously evaluated.
The connection of an additional 3 MVA load for MP2 onto the MP3 electrical distribution system will increase the short circuit fault levels on the MP3 electrical distribution system. If worst case conditions are established, the additional contribution from the MP2 loads would increase the fault level to above the switchgear ratings. The worst case short circuit conditions occur with MP3 at full power, the switchyard at its maximum voltage, an MP3 EDG paralleled to the bus for surveillance testing, and the MP3 to MP2 cross-tie supplying 3 MVA of power to MP2.
Although the fault levels could exceed the MP3 switchgear and circuit breaker ratings, it is not expected that the worst case conditions will be frequently established. For the majority of scenarios, this situation can be avoided because the new design allows the 3 MVA of power for MP2 to be supplied by either MP3 bus 34A or 34B. Procedural guidance will be provided to select the MP3 bus (34A or 34B) to supply power to MP2 that powers the opposite train from the train associated with the MP3 EDG to be tested. Even if the worst case plant configuration cannot be avoided, there is a low probability of event occurrence given the low probability of a bus fault coincident with the short time that the MP3 EDG would be paralleled to the system. In addition, the event would only affect one MP3 train of safety related equipment. The other train will be available to function as assumed to mitigate any accidents that may occur.
The use of the MP3 to MP2 cross-tie does not significantly alter the manner in which the plant is operated. Considering the low likelihood of a fault occurring concurrently with worst case conditions, and that only one MP3 train of safety related equipment should be affected, sufficient accident mitigation equipment will be available to mitigate a design basis accident. In addition, the response of the plant and the operators following a design basis event will not be significantly different. Therefore, this activity does not involve a significant increase in the probability or consequences of an accident previously evaluated.
2. Create the possibility of a new or different kind of accident from any accident previously evaluated.
The ability to supply 3 MVA of power from MP3 to MP2 will reduce the margin between the minimum switchyard voltage and the minimum acceptable switchyard voltage. However, the extra loading imposed by the MP2 safe shutdown loads on the MP3 power supplies is within the MP3 capability to simultaneously supply the worst case MP3 normal and accident loads. As a result, the response of the plant and the operators following an accident will not be
Maintaining breaker 13T and its associated disconnect switches open to ensure separation and independence of the two MP2 offsite sources is a change to the normal configuration of MP3. The new configuration involves the opening of a breaker. It does not involve any other physical changes to the plant or the operating methodology. This activity does reduce the diversity of offsite power supplies for the MP3 NSST, which increases the potential for a loss of offsite power at MP3. However, the plant response to a loss of offsite power because breaker 13T is open will not be significantly different from any previously analyzed loss of offsite power. Therefore, opening breaker 13T and its associated disconnect switches will not create the possibility of a new or different kind of accident from any previously evaluated.
The connection of an additional 3 MVA load for MP2 onto the MP3 electrical distribution system will increase the short circuit fault levels on the MP3 electrical distribution system. In the worst case, the short circuit fault could lead to a loss of one MP3 train of safety related equipment. However, the safety related equipment in the other train would remain capable of mitigating the event. The loss of a train of safety-related equipment is an analyzed event. Therefore, this activity will not introduce the possibility of a new or different kind of accident than any previously evaluated.
3. Involve a significant reduction in a margin of safety.
The MP3 to MP2 4160 Volt cross-tie will impose up to an additional 3 MVA load on MP3. As a result, the minimum acceptable switchyard voltage for MP3 will increase from 334 kV to 337 kV. The margin between the minimum switchyard voltage (345 kV) and the minimum acceptable switchyard voltage will decrease from 11 kV to 8 kV. This is an improvement for MP2. However, it is a reduction in the operating margin for MP3.
The analysis performed to support the new design shows that, with a minimum voltage of 337 kV in the switchyard, MP3 will remain connected to offsite power. The minimum voltage protection assures that acceptable starting and running voltages are present for the safety systems that may be required to operate should a loss of coolant accident (limiting design basis event) occur at MP3 while MP2 is being supplied with the safe shutdown load of 3 MVA from either the MP3 RSST or the MP3 NSST. Thus, the MP3 offsite connection will not be tripped when offsite power is available.
The extra loading imposed by the MP2 safe shutdown loads on the MP3 power supplies is within the MP3 capability to simultaneously supply the worst case MP3 normal and accident loads. As a result, the response of the plant and the operators following an accident will not be significantly different. There will be no adverse effect on plant operation or equipment important to safety. The plant response to the design basis accidents will not change and the accident mitigation equipment will continue to function as assumed in the design basis accident analysis. Therefore, this activity does not involve a significant reduction in a margin of safety.
The proposed design change will allow the MP3 RSST (or the MP3 NSST, if the MP3 RSST is unavailable) to provide the alternate offsite source for MP2 to meet GDC 17 requirements. If the MP3 RSST is not available, MP2 will need to credit the MP3 NSST as the alternate offsite power supply for GDC 17 compliance. This will require the 13T breaker to be open to meet GDC 17 requirements. As a result, the probability of a loss of offsite power at MP3 will increase.
A loss of offsite power at MP3 due to a fault in the offsite distribution network is a low probability event. When combined with the expected frequency of removing the MP3 RSST from service of once per MP3 refueling outage, the probability of a loss of offsite power at MP3 when shut down as a result of breaker 13T being open is low. In addition, the MP3 shutdown risk program will evaluate the impact of removing the MP3 RSST from service, and plan accordingly. This will ensure the MP3 RSST will be removed from service when the shutdown risk is determined to be acceptably low. Also, at least one MP3 EDG will be available, as required by Technical Specifications, to supply power to necessary loads if offsite power is lost.
The plant response to the design basis accidents will not change with breaker 13T open, and the accident mitigation equipment will continue to function as assumed in the design basis accident analysis. Therefore, this activity does not involve a significant reduction in a margin of safety.
The connection of an additional 3 MVA load for MP2 onto the MP3 electrical distribution system will increase the short circuit fault levels on the MP3 electrical distribution system. If worst case conditions are established, the additional contribution from the MP2 loads would increase the fault level to above the switchgear ratings. The worst case short circuit conditions occur with MP3 at full power, the switchyard at its maximum voltage, an MP3 EDG paralleled to the bus for surveillance testing, and the MP3 to MP2 cross-tie supplying 3 MVA of power to MP2.
Although the fault levels could exceed the MP3 switchgear and circuit breaker ratings, it is not expected that the worst case conditions will be frequently established. For the majority of scenarios, this situation can be avoided because the new design allows the 3 MVA of power for MP2 to be supplied by either MP3 bus 34A or 34B. Procedural guidance will be provided to select the MP3 bus (34A or 34B) to supply power to MP2 that powers the opposite train from the train associated with the MP3 EDG to be tested. Even if the worst case plant configuration cannot be avoided, there is a low probability of event occurrence given the low probability of a bus fault coincident with the short time that the MP3 EDG would be paralleled to the system. In addition, the event would only affect one MP3 train of safety related equipment. The other train will be available to function as assumed to mitigate any accidents that may occur.
The response of the plant and the operators following a design basis event will not be significantly different when using the MP3 to MP2 4160 Volt cross-tie. The accident mitigation equipment will continue to function as assumed in the design basis accident analysis. Therefore, this activity does not involve a significant reduction in a margin of safety.
The NRC staff has reviewed the licensee's analysis and, based on this review, it appears that the three standards of 10 CFR 50.92(c) are satisfied. Therefore, the NRC staff proposes to determine that the amendment request involves no significant hazards consideration.
1. Involve a significant increase in the probability or consequences of an accident previously evaluated. In the analysis of the safety issues concerning the expanded pool canal storage capacity, the following previously postulated accident scenarios have been considered:
The probability that any of the accidents in the above list can occur is not significantly
Accordingly, the proposed modification does not involve a significant increase in the probability of an accident previously evaluated.
The consequences of the previously postulated scenarios for an accidental drop of a fuel assembly in the SFP have been re-evaluated for the proposed change and were determined to be bounded by the existing analysis. The results show that the postulated accident of a fuel assembly striking the top of the storage racks will not distort the racks sufficiently to impair their functionality. The resulting structural damage to a falling assembly and/or a stored assembly has been determined to remain unchanged. The minimum subcriticality margin, K
The consequences of a loss of SFP cooling have been evaluated and found to have no increase. The concern with this accident is a reduction of SFP water inventory from bulk pool boiling resulting in uncovering fuel assemblies. This situation would lead to fuel failure and subsequent significant increase in offsite dose. Loss of SFP cooling at Kewaunee is mitigated by ensuring that a sufficient time period exists between the loss of forced cooling and uncovering fuel. This period of time is compared against a reasonable period to re-establish cooling or supply an alternative water source (such as service water, makeup water, or fire protection system water). This evaluation included the determination of the time to boil. The time to boil represents the onset of loss of pool water inventory and is commonly used as a gage for establishing the comparison of consequences before and after a refueling project. The heat up rate in the SFP is a nearly linear function of the fuel decay heat load. The fuel decay heat load will increase subsequent to the proposed changes because of the increase in the number of stored assemblies. The heat up rate established for the limiting heat load conditions prior to the addition of canal racking was 10.8°F per hour. This would result in the pool temperature increasing from the maximum design temperature of 150°F to boiling in a period of 5.7 hours. The heat up rate established for the limiting heat load conditions subsequent to the proposed changes has been determined as 7.5°F per hour. This would result in the pool temperature increasing from the maximum design temperature of 150°F to boiling in a period of 8.4 hours.
This time to boil comparison was made for limiting heat load conditions. However, the end of this period of time does not represent the onset of any significant increase in offsite doses. As stated above, this consequence would result after fuel is uncovered through unchecked boiling and the resulting water level drop of approximately 25 feet to the top of the fuel storage racks. This depth is conservative, since the top of active fuel is below this level. Subsequent to the proposed changes under limiting heat loads the maximum boil-off rate will decrease to 40.9 gpm. This will result in the time lapse between loss of SFP cooling and the uncovering of the racks to increase to 48.5 hours.
As stated above, subsequent to racking the canal, the time to boil after loss of forced cooling in the most severe scenario was 8.4 hours. The ensuing rate of evaporative loss would not result in the fuel being uncovered until after an additional 40.1 hours. The margin concerning time to boil will increase due to the proposed modification. This increased margin is due to the conservatism of the assumptions previously used to determine the heat load for this condition (
The consequences of a design basis seismic event are not increased. The consequences of this accident are evaluated on the basis of subsequent fuel damage or compromise of the fuel storage or building configurations leading to radiological or criticality concerns. The canal racks have been analyzed and found to properly function during seismic motion. The stored fuel has been determined to remain intact and the storage racks maintain the fuel and fixed poison configurations subsequent to a seismic event. The structural capability of the pool and liner will not be exceeded under the appropriate combinations of dead weight, thermal, and seismic loads. The SFP structure will remain intact during a seismic event and will continue to adequately support and protect the fuel racks, stored fuel, and pool coolant. Thus, the consequences of a seismic event are not increased.
Therefore, it is concluded that the proposed changes do not significantly increase the probability or consequences of any accident previously evaluated.
2. Create the possibility of a new or different kind of accident from any previously analyzed.
During and following project implementation, the spent fuel must be safely stored, meeting the requirements 10 CFR 20 and 10 CFR 100. The installation activities as well as the use of the canal racks must be evaluated for the possibility of creating a new or different kind of accident from any previously analyzed.
This evaluation was done by reviewing the differences between the analyses and assumptions associated with the proposed storage configuration (existing racks plus canal racks) with those of the existing storage configuration. The accident scenarios associated with the existing racks were then reviewed to determine if the possibility of a new type of accident would be introduced by the implementation of the proposed modification. Also, the installation activities were evaluated.
Due to the proposed changes, the following events were considered as the only events which might represent a new or different kind of accident:
a. An accidental drop of a rack module into the pool during construction activity.
b. Fuel assembly mispositioning accident in the canal.
A construction accident resulting in a rack drop is an unlikely event. A rack-lifting rig will be used to lift and suspend the racks using the existing Fuel Handling Building crane. The crane, hoists and lifting rig have been or will be designed, tested and inspected to ensure that they will properly lift and transport the new racks. The postulated rack drop event is commonly referred to as a “heavy load drop” over the pools. Heavy loads will not be allowed to travel over any racks containing fuel assemblies. The area of concern represented by this event is that the pool structure will be compromised leading to loss of moderator/coolant. The question of a new or different type of event is answered by determining whether heavy load drops of this type have been considered previously. The last phase of the re-racking of the SFPs at KNP was completed in 1987. The rack modules transported during installation of the pool re-racking project were significantly larger than those associated with the proposed canal rack project. Also, the KNP Technical Specifications state that “Placement of additional fuel storage racks is permitted, however, these racks must not traverse directly above spent fuel stored in the pools”. All movements of heavy loads will be strictly controlled by procedure, will follow approved safe load paths, and will be performed by qualified personnel. Therefore, the rack drop does not represent a new or different kind of accident.
Fuel assembly mispositioning in the canal is an unlikely event since assembly placement will be administratively controlled. The administrative controls will include positive, visual identification of each fuel assembly to be stored in the canal racks. The mispositioning event for the canal racks represents a change from the previously analyzed condition, since Kewaunee currently has no restriction on fuel storage.
Under the extremely unlikely conditions of a mispositioning event involving the placement of a fresh (un-burned) fuel assembly in the canal racks, the boron in the pool water will maintain the required subcriticality margin. Only a small fraction of the minimum pool boron concentration required by the KNPP Technical Specifications would be required for this condition. Under the postulated accident condition of a total loss of boron from the pool water, proper subcriticality margin would exist. The multiple accident scenario of the extremely unlikely mispositioning event combined with a postulated total loss of pool boron is a non-credible condition. Therefore, although credit is taken for a small amount of boron in the pool water for one accident condition, a decrease of pool boron concentration is not a new or different kind of accident from any previously analyzed.
The proposed change does not involve the modification of any equipment credited in the mitigation of the design basis accidents. The proposed change meets all applicable requirements for the safe storage of spent fuel at KNP. Therefore, the potential for a new or previously unanalyzed accident is not created by the implementation of this modification.
The refueling canal does not have floor drains. Therefore, draining the refueling canal through a floor drain is not a postulated event.
3. Involve a significant reduction in the margin of safety.
The function of the SFP is to store the fuel assemblies in a subcritical and coolable configuration through all environmental and abnormal loadings, such as an earthquake or fuel assembly drop. The new rack design must meet all applicable requirements for safe storage and be functionally compatible with the SFP.
WPSC has addressed the safety issues related to the expanded pool storage capacity in the following areas:
The mechanical, material, and structural designs of the new racks have been reviewed in accordance with the applicable provisions of the NRC Guidance entitled, “Review and Acceptance of Spent Fuel Storage and Handling Applications”. The rack materials used are compatible with the spent fuel assemblies and the SFP environment. The design of the new racks preserves the proper margin of safety during abnormal loads such as a dropped assembly and tensile loads from a stuck assembly. It has been shown that such loads will not invalidate the mechanical design and material selection to safely store fuel in a coolable and subcritical configuration.
The methodology used in the criticality analysis of the expanded SFP meets the appropriate NRC guidelines and ANSI standards. The margin of safety for subcriticality is maintained by having the neutron multiplication factor equal to, or less than, 0.95 under all accident conditions, including uncertainties. This criterion is the same as that used previously to establish criticality safety evaluation acceptance and remains satisfied for all analyzed accidents. Therefore, the accepted margin of safety remains the same.
The thermal-hydraulic and cooling evaluation of the pool demonstrated that the pool can be maintained below the specified thermal limits under all required design conditions. The pool temperature will not exceed 140°F during the failure of a cooling pump under normal offload conditions. The pool temperature will remain below the maximum design temperature of 150°F under maximum heat load conditions. The maximum local water temperature in the hot channel will remain below the boiling point. The fuel will not undergo any significant heat up after an accidental drop of a fuel assembly on top of the rack blocking the flow path. Following a loss of cooling to the pool sufficient time exists (48.5 hours for the limiting heat load) for the operators to intervene and line up alternate cooling paths and the means of inventory makeup before the onset of pool boiling. The thermal limit specified for the evaluations performed to support the proposed change is the same as was used in the previous evaluation. Therefore, the accepted margin of safety remains the same.
Thus, it is concluded that the changes do not involve a significant reduction in the margin of safety.
The NRC staff has reviewed the licensee's analysis and, based on this review, it appears that the three standards of 10 CFR 50.92(c) are satisfied. Therefore, the NRC staff proposes to determine that the amendment request involves no significant hazards consideration.
South Carolina Electric & Gas Company (SCE&G) has evaluated the proposed changes to the VCSNS TS described above against the significant Hazards Criteria of 10 CFR 50.92 and has determined that the changes do not involve any significant hazard. The following is provided in support of this conclusion.
1. Does the proposed change involve a significant increase in the probability or consequences of an accident previously evaluated?
The proposed amendment is a programmatic and administrative change to delete the ISEG. The requirement for an ISEG is located within the Administrative Section of TS (Section 6.0). The ISEG functions in an oversight role and, as such, performs no actions that would affect any precursors to any accident previously evaluated. This change does not physically alter safety-related systems, nor does it affect the way in which safety-related systems perform their functions. However, the independent oversight functions and qualification requirements stated in TS are being performed by qualified personnel in other departments of the VCSNS organization. This assures that the functions and qualification requirements delineated for the ISEG are being met. Because the design of the facility and system operating parameters are not being changed, and the oversight functions are performed by other departments, the proposed amendment does not involve an increase in the probability or consequences of any accident previously evaluated.
2. Does the proposed change create the possibility of a new or different kind of accident from any accident previously evaluated?
The proposed amendment to delete the ISEG is a programmatic and administrative change. There are no physical alterations to safety-related systems and no changes to the functions of any safety-related systems. The independent oversight functions assigned to the ISEG are addressed by other departments within the VCSNS organization. Personnel in those departments meet the qualifications required of the ISEG. This assures that the oversight functions and qualification requirements delineated for the ISEG are being met. Oversight functions that are performed do not in themselves lead to activities that are considered as accident precursors or initiators. Because this change does not alter the design of the facility and system operating parameters are not being changed, and the oversight functions and qualification requirements of the ISEG are being met by other departments, the proposed amendment does not create the possibility of a new or different kind of accident from any accident previously evaluated.
3. Does this change involve a significant reduction in margin of safety?
The proposed amendment is a programmatic and administrative change to
The NRC staff has reviewed the licensee's analysis and, based on this review, it appears that the three standards of 10 CFR 50.92(c) are satisfied. Therefore, the NRC staff proposes to determine that the amendment request involves no significant hazards consideration.
1. Do the proposed changes involve a significant increase in the probability or consequences of an accident previously evaluated?
Response: No.
The tubesheet and/or tube support plate intersection laser welded sleeve configurations [were] designed and analyzed in accordance with the requirements of the ASME Code [American Society of Mechanical Engineers Boiler and Pressure Vessel Code]. Fatigue and stress analyses of the sleeved tube assemblies produced acceptable results. Additionally, mechanical testing for the full length tubesheet sleeves has shown that the structural strength of Alloy 690 sleeves under normal, faulted, and upset conditions is within acceptable limits. Leakage testing for these same
The hypothetical consequences of failure of a sleeve would be bounded by the current steam generator tube rupture analysis included in the Comanche Peak Steam Electric Station (CPSES) Final Safety Analysis Report (FSAR). Due to the slight reduction diameter caused by the sleeve wall thickness, it is expected that primary coolant release rates would be slightly less than assumed for the steam generator tube rupture analysis (depending on the break location), and therefore, would result in lower total primary fluid mass release to the secondary system. Combinations of tubesheet sleeves and tube support plate sleeves would reduce the primary fluid flow through the sleeved tube assembly due to the series of diameter reductions the fluid would have to pass on its way to the break area. The overall effect would be reduced steam generator tube rupture release rates. The proposed Technical Specification change to support the installation of Alloy 690 laser welded sleeves does not adversely impact any other previously evaluated design basis accident or the results of (LOCA) [loss-of-coolant accident] and non-LOCA accident analyses for the current Technical Specification minimum RCS [reactor coolant system] flow rate.
Conformance of the sleeve design with the applicable sections of the ASME Code and the successful completion of the leakage and mechanical tests (for the lower sleeve joint for the elevated tubesheet sleeves (ETS), support the conclusion that the installation of laser welded tube sleeves will not increase the probability or consequences of an accident previously evaluated. Depending upon the break location for a postulated steam generator tube rupture event, implementation of tube sleeving could act to reduce the radiological consequences to the public due to reduced flow rate through a sleeved tube compared [to] a non-sleeved tube based on the restriction afforded by the sleeve wall thickness.
The editorial correction [to] Technical Specification (TS) Table 5.5-2 is typographical in nature and does not require additional evaluation. Therefore, the proposed changes do not involve a significant increase in the probability or consequences of an accident previously evaluated.
2. Do the proposed changes create the possibility of a new or different kind of accident from any accident previously evaluated?
Response: No.
Implementation of the laser welded sleeving (LWS) will not introduce significant or adverse changes to the plant design basis. Stress and fatigue analysis of the repair has shown the ASME Code minimum stress values are not exceeded. Implementation of laser welded sleeving restores the overall tube bundle structural and leakage integrity to a level consistent to that of the originally supplied tubing during all plant conditions. Any hypothetical accident as a result of potential tube or sleeve degradation in the repaired portion of the tube is bounded by the existing tube rupture accident analysis. Finally, through the results obtained from the extensive testing and qualification program, the possibility of a common-mode failure, such as multiple simultaneous steam generator tube failures, is not credible. Therefore, it is concluded that the proposed changes do not create the possibility of a new or different kind of accident from any accident previously evaluated.
The editorial correction [to] TS Table 5.5-2 is typographical in nature and does not require additional evaluation. Therefore, the proposed change does not create the possibility of a new or different kind of accident from any previously evaluated.
3. Do the proposed changes involve a significant reduction in a margin of safety?
Response: No.
The laser welded sleeving repair of degraded steam generated tubes as identified in References 1 and 2 was shown by analysis to restore the integrity of the tube bundle consistent with its original design basis condition. The safety factors used in the design of sleeves for the repair of degraded tubes are consistent with the safety factors in the ASME Boiler and Pressure Vessel Code used in steam generator design. The design of the full length tubesheet sleeve lower joints for the
EPRI [Electric Power Research Institute] qualified eddy current techniques will be used for the detection of tube degradation in
The effect of sleeving on the design transients and accident analyses were reviewed and found to remain valid up to the level of steam generator tube plugging consistent with the minimum reactor flow rate as specified in Technical Specification 3.4.1. Continued compliance with the RCS flow limits of Technical Specification 3.4.1 is assured through precision flow measurements.
Because all relevant safety analyses were reviewed and found to remain valid, and because the appropriate design margins are maintained through compliance with the relevant ASME Code requirements, it is concluded that the proposed change does not involve a significant reduction in a margin of safety.
The editorial correction [to] TS Table 5.5-2 is typographical in nature and does not require additional evaluation. The confirming modifications to the reporting requirements of TS 5.6.10 are administrative only. Therefore, these proposed changes do not involve a significant reduction in a margin of safety.
The NRC staff has reviewed the licensee's analysis and, based on this review, it appears that the three standards of 10 CFR 50.92(c) are satisfied. Therefore, the NRC staff proposes to determine that the amendment request involves no significant hazards consideration.
1. Do the proposed changes involve a significant increase in the probability or consequences of an accident previously evaluated?
Response: No.
The addition of this requirement to the Technical Specifications is administrative and has no impact on accident initiation or mitigation. Therefore, the proposed changes do not involve a significant increase in the probability or consequences of an accident previously evaluated.
2. Do the proposed changes create the possibility of a new or different kind of accident from any accident previously evaluated?
Response: No.
The addition of this requirement to the Technical Specifications is administrative and cannot initiate an accident. Therefore, the proposed change does not create the possibility of a new or different kind of accident from any previously evaluated.
3. Do the proposed changes involve a significant reduction in a margin of safety?
Response: No.
The addition of this requirement to the Technical Specifications is administrative and has no impact on accident initiation or mitigation. Therefore the proposed change does not involve a reduction in a margin of safety.
The NRC staff has reviewed the licensee's analysis and, based on this review, it appears that the three standards of 10 CFR 50.92(c) are satisfied. Therefore, the NRC staff proposes to determine that the amendment request involves no significant hazards consideration.
Virginia Electric and Power Company has reviewed the requirements of 10 CFR 50.92 as they relate to the proposed administrative change to the Operating Licenses, DPR-32 and DPR-37, and the associated Technical Specifications for Surry Units 1 and 2 and determined that a significant hazards consideration is not involved. The proposed administrative change to the Surry Operating Licenses and associated Technical Specifications makes minor editorial corrections, relocates one license condition to Appendix A of the license, and removes outdated, superceded or otherwise non-applicable license conditions and Technical Specifications requirements and provides a license document that is directly applicable to the current plant licensing and design bases. There is no safety significance associated with this proposed change since the change does not alter any currently applicable Operating License requirements. Accordingly, the current Surry licensing and design bases are unchanged. In support of this conclusion, the following evaluation is provided.
Criterion 1—The proposed license amendment does not involve a significant increase in the probability or consequences of an accident previously evaluated.
The proposed change is administrative (and in part editorial) in nature and neither station operations nor design are affected by the change. The removal of license conditions and associated Technical Specifications regarding superceded (OL Sections 3.H and 3.L) or expired (OL Section 3.0, TS Table 3.7-2, and TS 3.14) requirements has no impact on plant operations since the requirements no longer have a legitimate means of being applied. The relocation within the Operating License of the requirement to have a secondary water chemistry monitoring program (OL Section 3.K) to new Section 6.4.P of the Technical Specifications does not alter the program or its implementation. The impact of the replacement SGs at Surry and the re-design of the SG and RCP [reactor coolant pump] supports on the previously evaluated accidents was performed, approved and documented by the issuance of the license amendments for OL Sections 3. G and 3.M. Removal of these license conditions which refer to completed work and a design and licensing bases that is documented in the UFSAR [updated final safety analysis report] also does not alter station operation or the design of the affected components. The proposed change is within the current design and licensing bases of the facility. This change does not affect the initiators of analyzed events nor the assumed mitigation of accident or transient events. Analyzed events are initiated by the failure of plant structures, systems, or components. This change does not impact the condition or performance of these structures, systems or components. Consequences of analyzed events are the result of the plant being
Criterion 2—The proposed license amendment does not create the possibility of a new or different kind of accident from any accident previously evaluated.
The proposed change is administrative (and in part editorial) in nature. The license conditions and Technical Specifications that are being removed or relocated by this proposed change do not impact station operations or station equipment in any manner. The proposed change does not involve a physical alteration of the plant, nor a change in the methods used to respond to plant transients that has not been previously analyzed. No new or different equipment is being installed and no installed equipment is being removed or operated in a different manner. There is no alteration to the parameters within which the plant is normally operated or in the setpoints, which initiate protective or mitigative actions. Consequently, no new failure modes are introduced and the proposed change to the Surry Operating Licenses and Technical Specifications does not create the possibility of a new or different kind of accident or malfunction of equipment important to safety from any previously evaluated.
Criterion 3—The proposed license amendment does not involve a significant reduction in a margin of safety.
The proposed change is administrative (and in part editorial) in nature and neither station operations nor design are affected by the change. Margin of safety is established through the design of the plant structures, systems and components, the parameters within which the plant is operated, and the establishment of the setpoints for the actuation of equipment relied upon to respond to an event. Since station operations are not affected by the proposed change, the change does not impact the condition or performance of structures, systems or components relied upon for accident mitigation or any safety analysis assumptions. Therefore, the proposed change to the Surry Operating Licenses and Technical Specifications does not involve a reduction in any margin of safety described in the bases of the Technical Specifications.
The NRC staff has reviewed the licensee's analysis and, based on this review, it appears that the three standards of 50.92(c) are satisfied. Therefore, the NRC staff proposes to determine that the amendment request involves no significant hazards consideration.
The following notices were previously published as separate individual notices. The notice content was the same as above. They were published as individual notices either because time did not allow the Commission to wait for this biweekly notice or because the action involved exigent circumstances. They are repeated here because the biweekly notice lists all amendments issued or proposed to be issued involving no significant hazards consideration.
For details, see the individual notice in the
During the period since publication of the last biweekly notice, the Commission has issued the following amendments. The Commission has determined for each of these amendments that the application complies with the standards and requirements of the Atomic Energy Act of 1954, as amended (the Act), and the Commission's rules and regulations. The Commission has made appropriate findings as required by the Act and the Commission's rules and regulations in 10 CFR Chapter I, which are set forth in the license amendment.
Notice of Consideration of Issuance of Amendment to Facility Operating License, Proposed No Significant Hazards Consideration Determination, and Opportunity for A Hearing in connection with these actions was published in the
Unless otherwise indicated, the Commission has determined that these amendments satisfy the criteria for categorical exclusion in accordance with 10 CFR 51.22. Therefore, pursuant to 10 CFR 51.22(b), no environmental impact statement or environmental assessment need be prepared for these amendments. If the Commission has prepared an environmental assessment under the special circumstances provision in 10 CFR 51.12(b) and has made a determination based on that assessment, it is so indicated.
For further details with respect to the action see (1) the applications for amendment, (2) the amendment, and (3) the Commission's related letter, Safety Evaluation and/or Environmental Assessment as indicated. All of these items are available for public inspection at the Commission's Public Document Room, located at One White Flint North, 11555 Rockville Pike (first floor), Rockville, Maryland 20852. Publicly available records will be accessible electronically from the ADAMS Public Library component on the NRC Web site, http://www.nrc.gov (the Electronic Reading Room).
The Commission's related evaluation of the amendment is contained in a Safety Evaluation dated October 12, 2000.
The August 11, and September 14, 2000, letters provided clarifying information that did not change the initial no significant hazards consideration determination and did not expand the scope of the original notice.
The Commission's related evaluation of the amendment is contained in a Safety Evaluation dated October 18, 2000.
The Commission's related evaluation of the amendments is contained in a Safety Evaluation dated October 10, 2000.
The supplemental information contained clarifying information and did not change the initial no significant hazards consideration determination and did not expand the scope of the original
The Commission's related evaluation of the amendments is contained in a Safety Evaluation dated October 13, 2000.
No significant hazards consideration comments received: No.
The Commission's related evaluation of the amendment is contained in a Safety Evaluation dated October 12, 2000.
The Commission's related evaluation of the amendment is contained in a Safety Evaluation dated October 6, 2000.
The May 4 and July 10, 2000, letters provided clarifying information that did not change the initial proposed no significant hazards consideration determination or expand the scope of the application as published in the
The Commission's related evaluation of the amendment is contained in a Safety Evaluation dated October 16, 2000.
The Commission's related evaluation of the amendment is contained in a Safety Evaluation dated October 4, 2000.
The Commission's related evaluation of the amendment is contained in a Safety Evaluation dated October 13, 2000.
The supplemental information contained clarifying information and did not change the initial no significant hazards consideration determination and did not expand the scope of the original
The Commission's related evaluation of the amendment is contained in a Safety Evaluation dated October 12, 2000.
The Commission's related evaluation of the amendments is contained in a Safety Evaluation dated October 10, 2000.
The Commission's related evaluation of the amendment is contained in a Safety Evaluation dated October 6, 2000.
The Commission's related evaluation of the amendment is contained in a Safety Evaluation dated October 19, 2000.
The August 24, 2000, letter provided clarifying information that did not change the initial proposed no significant hazards consideration determination or expand the scope of the original
The Commission's related evaluation of the amendments is contained in a Safety Evaluation dated October 18, 2000.
The Commission's related evaluation of the amendment is contained in a Safety Evaluation dated October 10, 2000.
The February 4, 2000, letter provided clarifying information that did not change the initial proposed no significant hazards consideration determination and did not expand the amendment beyond the scope of the original notice.
The Commission's related evaluation of the amendment is contained in a Safety Evaluation dated October 10, 2000.
The Commission's related evaluation of the amendment is contained in a Safety Evaluation dated October 10, 2000.
The Commission's related evaluation of the amendments is contained in a Safety Evaluation dated October 10, 2000.
Public comments requested as to proposed no significant hazards consideration: Yes (65 FR 56943 dated September 20, 2000). The notice provided an opportunity to submit comments on the Commission's proposed no significant hazards consideration determination. No comments have been received. The notice also provided for an opportunity to request a hearing by October 20, 2000, but indicated that if the Commission makes a final no significant hazards consideration determination any such hearing would take place after issuance of the amendment.
The Commission's related evaluation of the amendment, finding of exigent circumstances, and final determination of no significant hazards consideration are contained in a Safety Evaluation dated October 6, 2000.
For the Nuclear Regulatory Commission.
Securities and Exchange Commission (“Commission” or “SEC”).
Notice of application for an order under sections 6(c) and 57(c) of the Investment Company Act of 1940 (the “Act”) for an exemption from sections 57(a)(1) and 57(a)(2) of the Act, and under section 57(i) of the Act and rule 17d-1 under the Act authorizing certain joint transactions otherwise prohibited by section 57(a)(4) of the Act.
Applicants request an order that would permit (1) a business development company (“BDC”) to engage in a loan origination agreement with an affiliated real estate investment trust, (2) investment management agreements between subsidiaries of the BDC and the real estate investment trust, and (3) the establishment of special purpose entities owned by the BDC and the real estate investment trust to engage in joint loan securitizations. The requested order would supersede an existing order.
PMC Capital, Inc. (“PMC”), PMC Commercial Trust (the “REIT”), PMC Advisers, Ltd. (“Advisers”), and PMC Asset Management, Inc. (“Managers”).
The application was filed on September 9, 1999 and amended on March 29, 2000 and October 24, 2000.
An order granting the application will be issued unless the SEC orders a hearing. Interested persons may request a hearing by writing to the SEC's Secretary and serving applicants with a copy of the request, personally or by mail. Hearing requests should be received by the SEC by 5:30 p.m. on November 20, 2000, and should be accompanied by proof of service on applicants, in the form of an affidavit, or, for lawyers, a certificate of service. Hearing requests should state the nature of the writer's interest, the reason for the request, and the issues contested. Persons may request notification of a hearing by writing to the SEC's Secretary.
Secretary, SEC, 450 Fifth Street, N.W., Washington, D.C. 20549. Applicants, 18111 Preston Road, Suite 600, Dallas, Texas 75252.
Marilyn Mann, Senior Counsel, at (202) 942-0582, or Mary Kay Frech, Branch Chief, at (202) 942-0564 (Division of Investment Management, Office of Investment Company Regulation).
The following is a summary of the application. The complete application may be obtained for a fee from the SEC's Public Reference Branch, 450 5th Street, N.W., Washington D.C. 20549-0102 (telephone (202) 942-8090).
1. PMC, a Florida corporation, is a closed-end diversified management investment company. On June 7, 1994, PMC filed notification of its election to operate as a BDC. PMC provides early stage financing and makes available significant managerial assistance to small businesses and receives interest income, loan servicing and other fees
2. The REIT, formed in June 1993, is a Texas real estate investment trust whose common shares of beneficial interest are traded on the American Stock Exchange. The REIT was formed to take advantage of certain loan origination opportunities that PMC was unable to pursue because, among other things, many of its customers grew to exceed the limitations applicable to the SBA program or potential new borrowers were interested in loans of a size or type that did not meet the SBA criteria, and leverage restrictions applicable to PMC precluded it from borrowing enough additional capital to satisfy loan demand.
3. To mitigate against potential conflicts of interest between PMC and the REIT, PMC and the REIT entered into a loan origination agreement to set forth specific objective criteria to be used to allocate loan origination opportunities between them. The agreement provides that PMC will continue to make loans through its investment company subsidiaries in accordance with the eligibility requirements of the SBA programs used by the subsidiaries. Pursuant to the loan origination agreement, the REIT makes loans primarily (a) to borrowers that exceed the eligibility requirements of the SBA programs used by PMC, (b) in excess of $1,100,000, or (c) that do not conform to PMC's fundamental policies. In 1993, PMC obtained an order under the Act (the “1993 Order”)
4. Advisers is the successor-in-interest by merger to PMC Advisers, Inc. Advisers is an indirect, wholly owned subsidiary of PMC, and Managers is a direct, wholly owned subsidiary of Advisers. Advisers presently provides services to the REIT with respect to the REIT's ownership of commercial real estate properties. Managers presently provides services to the REIT with respect to the REIT's loan origination activities. Advisers and Managers pay all of their net income to PMC in the form of dividends or partnership distributions. The executive management teams of the REIT, PMC, Advisers and Managers are comprised of the same individuals.
5. PMC and the REIT propose to enter into arrangements to generate working capital from time to time by jointly selling through securitization transactions portions of their respective loan portfolios. At such time as PMC and the REIT have originated a sufficient amount of loans to securitize on a cost-effective basis, PMC and the REIT propose to form a jointly owned special purpose entity (“SPE”). PMC and the REIT will each transfer ownership of the loans to the SPE in exchange for cash and an equity interest in the SPE based upon the relative outstanding principal balance of the loans that each contributes to the SPE. As the equity owners of the SPE, each of PMC and the REIT will retain the residual interest in the specific loans it transfers to the SPE to the extent any loans remain following repayment in full of the securities issued by the SPE.
6. Each SPE will be a limited partnership, limited liability company, trust or some other type of entity the form of which will be determined at the time of each transaction. Each SPE will be a passive, special purpose bankruptcy-remote entity and its organizational documents will expressly limit its activities to owning and holding the loans, issuing debt securities and other activities that are reasonably related thereto. Each SPE will rely on rule 3a-7 under the Act for an exemption from regulation under the Act. Each of PMC and the REIT will continue to service the loans that it transfers to the SPE pursuant to a servicing agreement that will govern the servicing of the loans and any other loan related property owned by the SPE. The SPE will pay PMC and the REIT a servicing fee for servicing the loans transferred to the SPE, which will be equal to the servicing fee that each would receive in a transaction in which the other was not a participant.
7. PMC and the REIT do not anticipate that they will necessarily transfer the same amount of loans to the SPE in connection with any particular transaction. However, the rights and obligations (other than any rights or obligations based solely on each entity's percentage ownership interest in the SPE) of each of PMC and the REIT under the transaction documents will be identical. To ensure that neither PMC nor the REIT is disadvantaged relative to the other with respect to the purchase price it receives upon the transfer of the loans to the SPE, the relative ownership interests of PMC and the REIT in the SPE and the amount of net proceeds each receives for the loans it transfers to the SPE will be based on the aggregate outstanding principal balance of the loans each such party transfers to the SPE without regard to the interest rates on such loans. Thereafter, to ensure that PMC and the REIT each benefit from the value of the loans it transfers to the SPE, all subsequent distributions to be made to PMC and the REIT under the securitization documents will be allocated proportionately based upon the relationship that the amount of the funds available for distribution to PMC and the REIT that is attributable to the loans (including the interest earned thereon) that were transferred to the SPE by such party bears to the total amount of funds then available for distribution to PMC and the REIT. Accordingly, the distributions each of PMC and the REIT receives will be based upon the performance of the loans that it transfers to the SPE.
8. PMC and the REIT will be required to pay certain expenses (including accounting, legal, investment banking, rating agency, printing, filing, recording and other expenses) incurred in connection with the issuance of securities by the SPE. They will each pay their portion of such expenses in accordance with their respective ownership interests in the SPE.
9. The SPEs will issue debt securities (the “SPE Debt Securities”) to investors in private placement transactions exempt from registration under section 4(2) of the Securities Act of 1933 (the “Securities Act”). The senior class of the SPE Debt Securities will be rated by a nationally recognized rating agency in one of its two highest rating categories. The indebtedness evidenced by the SPE Debt Securities will be secured by a security interest in the loans and will be over-collateralized as the aggregate outstanding principal balance of the loans securing the SPE Debt Securities will exceed the principal amount of the
10. Applicants state that, historically, PMC's primary sources of capital and liquidity have been debentures issued through programs of the SBA, private and public issuances of common stock, the private issuance of senior unsecured medium term notes and the utilization of its short-term, unsecured revolving credit facility. Due to changes in certain SBA programs during the past three years that have increased the cost of SBA debentures, PMC has utilized other more cost-effective sources of funds to finance and expand its loan portfolio. PMC has been able to generate cost-effective growth in its investment portfolio through the sale from time to time of a portion of its loan portfolio through securitization transactions. These loan sales accomplished through securitization transactions have enabled PMC to generate working capital at rates generally better than available through the issuance of SBA debentures under the terms recently in existence. From time to time during the past four years the REIT has also raised working capital through the sale of portions of its loan portfolio through securitization transactions. Applicants contend that PMC and the REIT could each utilize the securitization process more effectively on a combined basis.
11. Applicants state that the proposed transactions would enable PMC and the REIT to accumulate larger, more diversified loan portfolios and thereby achieve larger asset-backed securities offerings. Geographic and borrower diversity in the loan portfolio reduces the risk associated with the securities to be issued by the SPE and is therefore fundamental to and may benefit the rating process. Applicants state that more widely diversified loan portfolios will improve their ability to obtain a rating in one of the two highest ratings categories from a nationally recognized rating agency, which will result in a lower interest rate on the SPE Debt Securities. Applicants state that increasing the size of the securitization transaction should not increase substantially the associated transaction costs and should therefore significantly reduce the transaction costs that would otherwise be paid by each of PMC and the REIT in connection with a securitization transaction conducted on an individual basis.
1. Applicants request an order under sections 6(c) and 57(c) of the Act granting an exemption from sections 57(a)(1) and 57(a)(2) of the Act, and under section 57(i) of the Act and rule 17d-1 under the Act authorizing certain joint transactions otherwise prohibited by section 57(a)(4) of the Act. The requested order will supercede the 1993 Order.
2. Section 57(a)(1) of the Act provides that it shall be unlawful for any person related to a BDC in the manner specified in section 57(b) of the Act, acting as principal, knowingly to sell any security or other property to the BDC or to any company controlled by the BDC, unless the sale involves solely (a) securities of which the buyer is the issuer, or (b) securities of which the seller is the issuer and which are part of a general offering to the holders of a class of its securities. Section 57(a)(2) provides that it shall be unlawful for any person related to a BDC in the manner specified in section 57(b), acting as principal, knowingly to purchase from the BDC or from any company controlled by the BDC, any security or other property (except securities of which the seller is the issuer).
3. Section 57(b) provides, among other things, that section 57(a) shall apply to any person directly or indirectly controlling, controlled by, or under common control with, a BDC. Under section 2(a)(9) of the Act, a control relationship is presumed to exist if a person, either directly or through one or more controlled companies, is the beneficial owner of more than 25% of a company's outstanding voting securities. Section 57(c) of the Act provides that a person may file with the Commission an application for an order exempting a proposed transaction from sections 57(a)(1) or 57(a)(2). The Commission shall grant the application if (a) the terms of the proposed transaction, including the consideration to be paid or received, are reasonable and fair and do not involve overreaching of the BDC or its shareholders on the part of any person concerned, (b) the proposed transaction is consistent with the policy of the BDC as recited in the filings made by the company under the Securities Act, its registration statement and reports filed under the Securities Exchange Act of 1934 (the “Exchange Act”), and its reports to shareholders, and (c) the proposed transaction is consistent with the general purposes of the Act.
4. Section 6(c) of the Act provides that the Commission may exempt any person, security, or transaction, or any class of persons, securities, or transactions, if and to the extent that such exemption is necessary or appropriate in the public interest and consistent with the protection of investors and the purposes fairly intended by the policy and provisions of the Act.
5. PMC will own more than 25% of the outstanding voting securities of an SPE and thus will be deemed to control the SPE. Section 57(a) thus applies to transactions between PMC and an SPE. The proposed securitization transactions contemplate that PMC and the REIT will each transfer loans to the SPE in exchange for cash and an equity interest in the SPE. The transfer of the equity interests by the SPE to PMC constitutes the sale of a security to a BDC and is therefore prohibited by section 57(a)(1). In addition, the acquisition of loans by an SPE from PMC will constitute the purchase of property from a BDC and is therefore prohibited by section 57(a)(2).
6. Applicants believe that the proposed transactions satisfy the standards for relief set forth in sections 57(c) and 6(c). Applicants state that conditions 8 and 9 to the requested relief would assure that the consideration to be paid or received is reasonable and fair and would not involved overreaching of the BDC or its shareholders on the part of any person concerned.
7. Applicants state that the proposed transactions are consistent with the policies of PMC as set forth in its public filings and reports to shareholders. Applicants therefore believe that the requested relief is appropriate in the public interest and consistent with the protection of investors and the policies and provisions of the Act.
8. Section 57(a)(4) provides that it shall be unlawful for any person related to a BDC in the manner specified in section 57(b) of the Act, acting as principal, knowingly to effect any transaction in which the BDC or a company controlled by the BDC is a joint or a joint and several participant with such person in contravention of Commission rules adopted for the purpose of limiting or preventing participation by the BDC or controlled company on a basis less advantageous than that of such person.
9. Section 57(i) of the Act provides that, until the Commission prescribes rules under sections 57(a) and 57(d), the Commission's rules under sections 17(a) and 17(d) of the Act applicable to registered closed-end investment companies shall be deemed to apply to sections 57(a) and 57(d) of the Act. Because the Commission has not adopted any rules under section 57(a)(4), rule 17d-1 applies.
10. Rule 17d-1 under the Act generally prohibits affiliated persons of an investment company from entering into joint transactions with the company without prior Commission authorization. In passing upon applications under rule 17d-1, the Commission considers whether the participation by the BDC in the joint transaction is consistent with the provisions, policies, and purposes of the Act and the extent to which such participation is on a basis different from or less advantageous than that of other participants.
11. The REIT is advised by Advisers and Managers and thus could be deemed to be controlled by Advisers and Managers. Advisers and Managers are wholly owned subsidiaries of PMC and thus are persons controlled by PMC. The REIT is thus indirectly controlled by PMC. The REIT is prohibited from entering into joint transactions with PMC absent an exemptive order.
12. The proposed joint securitizations will be joint transactions involving PMC and the REIT. Applicants believe that the proposed transactions are consistent with the provisions, policies and purposes of the Act and that participation of PMC in the proposed transactions will not be on a basis less advantageous than that on the REIT. The directors of PMC, including a “required majority” of the directors as defined in section 57(o), will determine that the terms of the transactions, including the consideration to be paid, are reasonable and fair. The terms of each joint securitization will be the same for PMC and the REIT. Applicants contend that sufficient safeguards are in place through the underwriting and ratings processes to prevent the REIT or PMC from transferring disproportionately inferior credit quality loans to an SPE. In addition, the REIT will make certain representations relating to the credit quality of the loans it transfers as described in condition B.3.
13. A “required majority,” as defined in section 57(o) of the Act, of the directors of PMC will be required to make a determination in connection with any proposed securitization transaction that the loans transferred to the SPE by PMC could not have obtained a higher credit rating in a transaction not involving the participation of the REIT. To assist the directors of PMC in making this determinations, the directors will be provided with the same extensive an detailed loan and credit information that is provided to a rating agency, including information about the loan origination operations of PMC and REIT, the credit underwriting criteria utilized in originating the loans, historical delinquency and collection information, and loan loss and recovery histories. This information will provide a detailed analysis of the loan portfolio characteristics, including loan concentration by state, franchisor, and other pertinent characteristics of the loan portfolio. The board of directors will also be provided sample marketing information, delinquency and problem loan reports and such other due diligence reports and information as the rating agencies utilize in rating any such transaction. Information provided to PMC's board of directors will also include an analysis comparing the PMC loan pool to the loan pool to be transferred to the SPE by the REIT. Finally, PMC will provide its board of directors with an executive summary of each loan included in the PMC pool and each loan included in the REIT pool on an individual pool basis, which will contain detailed information about each loan, including the property type, date of loan origination, original loan principal amount, outstanding principal balance, current interest rate, maturity date, delinquency history, amortization period, original and current loan-to-value ratios, debt-service-coverage ratio and property location.
14. Applicants state that, in the unlikely event that the credit quality of the loans conveyed by the REIT or PMC is significantly disproportionately lower than the credit quality of the loans conveyed by the other party, the residual interest of the party contributing the higher quality loans could be disproportionately impacted. To protect the party transferring a higher quality loan portfolio against this possibility, each transaction will be structured so that all distributions to PMC and the REIT under the documents will be based on the performance of the loans transferred by PMC or the REIT, as the case may be. Either the organizational documents of the SPE and/or a separate agreement between PMC and the REIT will provide that any and all amounts distributable to PMC and the REIT in respect of each party's residual interest in its loans will be determined pursuant to a percentage allocation, the numerator of which is the amount of funds available for distribution that is attributable to the loans transferred by such party to the SPE and the denominator of which is the total funds then available for distribution to PMC and/or the REIT. Each party will also agree to reimburse the other in the unlikely event such other party's residual interest in the loans it transferred to the SPE is disproportionately impacted as a result of the non-performance of the loans transferred to the SPE by such party.
15. Applicants state that a particular securitization transaction could also potentially be less advantageous to PMC or the REIT if one of the parties commits an act or omission that subjects that other to liability. PMC and the REIT will each execute a cross-indemnity agreement to protect the other party against the risk.
16. Applicants also seek an order under section 57(i) and rule 17d-1 superseding the 1993 Order which permits the loan origination agreement between PMC and the REIT and investment management agreements between Advisers and the REIT and Managers and the REIT.
Applicants agree that any order granting the requested relief will be subject to the following conditions:
1. PMC's board of directors, including a “required majority” or the directors as defined in section 57(o) of the Act, will review at least annually the relationship
2. A loan origination agreement has been entered into between PMC and the REIT to set forth specific objective criteria, as described in the application, which is utilized by Managers to allocate loan origination opportunities. Any amendments or modifications to the loan origination agreement will be approved by PMC's board of directors, including the “required majority.”
3. The minutes of the meetings of PMC's board regarding the relationships among Managers, the REIT and their affiliated persons, including consideration of the advisory agreement between Managers and the REIT, and among Advisers, the REIT and their affiliated persons, including consideration of the management agreement between Advisers and the REIT, and the loan origination agreement or any amendments or modifications thereto, will reflect in detail a description of the board's deliberations, its findings, the information or materials upon which its findings were based, and the reasons for the directors' determination (a) that the relationships among Managers, the REIT and their affiliated persons, including the investment advisory agreement between Managers and the REIT, (b) that the relationship among Advisers, the REIT and their affiliated persons, including the management agreement between Advisers and the REIT, or (c) the loan origination agreement and any amendments or modifications thereto, as the case may be, is in the best interests of both PMC and its shareholders.
4. PMC will, without prejudice to the rights of its board of directors to dispose of PMC's interests in Advisers or Managers in their respective entireties, at all times own directly or indirectly beneficially and of record all of the issued and outstanding shares of capital stock or partnership interests of Advisers and Managers, as the case may be, and will cause Advisers and Managers not to issue any authorized but unissued shares of its capital stock or partnership interests to any person other than PMC or a wholly-owned subsidiary of PMC.
5. A majority of the directors of PMC, Advisers and Managers will not have any financial interest in or be “interested persons” of the REIT, as if the REIT were an investment company under section 2(a)(19)(A).
1. (a) The directors of PMC will receive written information concerning all joint securitization opportunities. The directors may request such additional information as they deem necessary to the exercise of their reasonable business judgment, and they will also employ such experts, including lawyers and accountants, as they deem appropriate to the reasonable exercise of this oversight function. PMC will engage in a joint securitization with the REIT only if a “required majority” of the directors of PMC conclude, prior to the transaction, that:
(i) The terms of the transaction, including the consideration to be paid, are reasonable and fair to the shareholders of PMC and do not involve overreaching of PMC on the part of any person concerned;
(ii) The transaction is consistent with the interests of the shareholders of PMC and is consistent with PMC's investment objectives and policies as recited in filings made by PMC under the Securities Act, as amended, its registration statement and reports filed under the Exchange Act and its reports to shareholders; and
(iii) Participation in the transaction by the REIT would not disadvantage PMC, and that participation by PMC would not be on a basis different from or less advantageous than that of the REIT.
(b) PMC has the right to decline to participate in any joint securitization opportunity.
2. The directors of PMC will be provided with a detailed credit rating analysis of each pool of loans to be contributed by PMC and the REIT in connection with any proposed joint securitization transaction and the investment bankers of PMC will provide a detailed presentation to PMC's directors analyzing each pool of loans on an individual pool basis. If the “required majority” of directors of PMC determine that the loans contributed by the REIT are of an inferior credit quality and would cause the transaction to receive a credit rating lower than the credit rating PMC's loans could otherwise obtain in a transaction not involving the REIT, PMC will not participate in the joint transaction.
3. The loans transferred by the REIT to the SPE will satisfy the following conditions: (a) Such loans will have a weighted average loan-to-value ratio at the time of loan origination that is less than the weighted average loan-to-value ratio at the time of loan origination of the loans that PMC transfers to the SPE; (b) such loans will have a weighted average loan-to-value ratio at the time of transfer that is less than the weighted average loan-to-value ratio of the loans that PMC transfers to the SPE; (c) no loan transferred by the REIT will be 30 days delinquent at the time of transfer; and (d) an environmental site assessment shall have been performed in connection with the origination of each such loan and to the REIT's knowledge, at the time of origination, the property securing each such loan was in material compliance with all applicable federal, state and local environmental laws and regulations.
4. Records required by section 57(f)(3) of the Act will be maintained as if each of the transactions permitted under these conditions were approved by the “required majority” of PMC's directors under section 57(f).
5. The senior class of each asset-backed securities offering issued by an SPE jointly owned by PMC and the REIT will be rated in one of the two highest ratings categories by a NRSRO, as defined in rule 2a-7 under the Act.
6. Loans originated by the REIT will not be eligible to participate in any joint transaction unless they were underwritten by the REIT utilizing the same credit quality and underwriting criteria as that utilized by PMC with respect to any loans it originates and transfers to an SPE.
7. Neither PMC nor the REIT will utilize any selection criteria with respect to the loans it selects to transfer to any SPE that would result in such loans being of a quality generally inferior to that of all of its loans taken as a whole.
8. On the date of the transfer, each of PMC and the REIT will receive net proceeds in respect of the loans it transfers to the SPE in an amount equal to the aggregate outstanding principal balance of the loans it transferred to the SPE less its pro rata portion (based on the ratio of the aggregate principal balance of the loans its transfers to the total aggregate principal balance of all loans transferred by PMC and the REIT to the SPE) of any trustee fees, rating agency fees, other transaction costs and any initial reserve account deposits and required over-collateralization amounts.
9. Following the initial distribution of net proceeds to PMC and the REIT, all subsequent distributions to PMC and/or the REIT made in respect of their respective residual interests in the loans
10. PMC and the REIT will agree pursuant to the organizational documents of the SPE or a separate agreement to reimburse the other party to the extent that such other party's residual interest in the loans it transferred to the SPE is disproportionately impacted as a result of the non-performance of the loans transferred to the SPE by PMC or the REIT, as the case may be.
11. Each of PMC and the REIT will continue to service the loans it transfers to the SPE and shall receive the servicing fee payable in respect thereof for so long as PMC and the REIT service the loans in accordance with the terms of the securitization documents.
12. PMC and the REIT will provide quarterly servicing reports to the board of directors of PMC and the trust managers of the REIT. Such reports shall show in reasonable detail all collections received from the loans transferred by each of PMC and the REIT as well as all deposits, payments and distributions made from the collection amounts and the reserve account. Such servicing reports shall also provide information on the status of any delinquent loans and any loan that becomes a charged-off loan.
13. PMC and the REIT will provide to the board of directors of PMC and the trust managers of the REIT notice of the occurrence of any event, non-payment or loan loss with respect to any loan transferred to the SPE by one party that reduces the reserve account or increases the minimum amount required to be on deposit in the reserve account or causes the other party not to receive the distribution amount that it would have otherwise been entitled to receive if such event or loss had not occurred (each a “Reimbursement Trigger Event”).
14. PMC and the REIT will provide the board of directors of PMC and the trust managers of the REIT with notice when all amounts owing to PMC or the REIT, as the case may be, in respect of a Reimbursement Trigger Event have been paid in full by the other party.
15. The expenses associated with each joint securitization transaction will be shared by PMC and the REIT in proportion to their ownership interests in the SPE.
16. The terms and conditions of each joint securitization will be the same for PMC and the REIT.
17. The Independent Directors will review quarterly all relevant information concerning joint securitization transactions created during the preceding quarter to determine whether the conditions set forth in the application were compiled with.
For the Commission, by the Division of Investment Management, pursuant to delegated authority.
Notice is hereby given that the following filing(s) has/have been made with the Commission pursuant to provisions of the Act and rules promulgated under the Act. All interested persons are referred to the application(s) and/or declaration(s) for complete statement of the proposed transaction(s) summarized below. The application(s) and/or declaration(s) and any amendment(s) is/are available for public inspection through the Commission's Branch of Public Reference.
Interested persons wishing to comment or request a hearing on the application(s) and/or declaration(s) should submit their views in writing by November 20, 2000, to the Secretary, Securities and Exchange Commission, Washington, DC 20549-0609, and serve a copy on the relevant applicant(s) and/or declarant(s) at the address(es) specified below. Proof of service (by affidavit or, in the case of an attorney at law, by certificate) should be filed with the request. Any request for hearing should identify specifically the issues of facts or law that are disputed. A person who so requests will be notified of any hearing, if ordered, and will receive a copy of any notice or order issued in the matter. After November 20, 2000, the application(s) and/or declaration(s), as filed or as amended, may be granted and/or permitted to become effective.
Appalachian Power Company (“Appalachian”), 40 Franklin Road, SW, Roanoke, Virginia 24011, an electric public-utility subsidiary company of American Electric Power Company, Inc., a registered holding company, has filed a post-effective amendment to its application-declaration under sections 9(a), 10 and 12(d) of the Act and rules 44 and 54 under the Act.
By order dated December 10, 1974 (HCAR No. 18703), the Commission authorized Appalachian, among other things, to enter into an agreement of sale (“Agreement”) with the Industrial Development Authority of Russell County, Virginia (“Authority”), concerning the financing of pollution control facilities (“Facilities”) at Appalachian's Glen Lyn and Clinch River plants. Under the Agreement, the Authority may issue and sell its pollution control revenue bonds (“Revenue Bonds”) or pollution control refunding bonds (“Refunding Bonds” and, together with Revenue Bonds, “Bonds”), in one or more series, and deposit the proceeds with the trustee (“Trustee”) under an indenture (“Indenture”) entered into between the Authority and the Trustee. The Trustee applies the proceeds to the payment of the costs of construction of the Facilities or, in the case of proceeds from the sale of the Refunding Bonds, to the payment of principal, premium (if any) and/or interest on Bonds to be refunded.
The same order also authorized Appalachian to convey an undivided interest in a portion of the Facilities to the Authority, and to reacquire that interest under an installment sales arrangement (“Sales Agreement”) requiring Appalachian to pay as the purchase price semi-annual installments in an amount that, together with other funds held by the Trustee under the Indenture for that purpose, will enable the Authority to pay, when due, the interest and principal on the Bonds. The Authority has issued and sold eight series of Bonds in an aggregate principal amount of $116.24 million of which $37.0 million presently are outstanding.
The Authority now intends to issue and sell an additional series of bonds in the aggregate principal amount of up to $17.5 million (“Series I Refunding Bonds)” the proceeds of which will be used to provide for the redemption on or prior to maturity of $17.5 million principal amount of the Series G Bonds of the Authority. It is contemplated that the Series I Refunding Bonds will be issued and secured under a supplemental indenture between the Authority and the Trustee. Appalachian proposes to enter into an amended Sales Agreement in connection with the Series I Refunding Bonds under essentially the same terms and
It is contemplated that the series I Refunding Bonds will be sold under arrangements with a group of underwriters with such terms as shall be specified by Appalachian. The Series I Refunding Bonds shall have a stated maturity of no more than forty years, a fixed rate of interest that shall not exceed 8% per annum or an initial rate of interest by any fluctuating rate Bonds that shall not exceed 8%. If it is deemed advisable, the Series I Refunding Bonds may be provided some form of credit enhancement.
Appalachian Power company (“Appalachian”), 40 Franklin Road, SW., Roanoke, Virginia 24011, an electric public-utility subsidiary company of American Electric Power Company, Inc., a registered holding company, has filed a post-effective amendment to its application-declaration under sections 9(a), 10 and 12(d) of the Act and rules 44 and 54 under the Act.
By order dated June 30, 1978 (HCAR No. 20610) (“Order”), Appalachian was authorized, among other things, to enter into an agreement of sale (“Agreement”) with Mason County, West Virginia (“County”). The Agreement provided for the construction, installation, financing and sale of certain pollution control facilities (“Facilities”) at Appalachian's Mountaineer and Philip Sporn Units 1 and 3. Under the Agreement, the County may issue and sell its pollution control revenue bonds (“Revenue Bonds”) or pollution control refunding bonds (“Refunding Bonds” and, together with Revenue Bonds, “Bonds”), in one or more series, and deposit the proceeds with the trustee (“Trustee”) under an indenture (“Indenture”) entered into between the County and the Trustee. The proceeds are applied by the Trustee to the payment of the costs of construction of the Facilities, or in the case of proceeds from the sale of Refunding Bonds, to the payment of the principal, premium (if any) and/or interest on Bonds to be refunded.
The Order also authorized Appalachian to convey an undivided interest in a portion of the Facilities to the County, and to reacquire that interest under an installment sales arrangement (“Sales Agreement”) requiring Appalachian to pay as the purchase price semi-annual installments in an amount that, together with other funds held by the Trustee under the Indenture for that purpose, will enable the County to pay, when due, the interest and principal on the Bonds. The County has issued and sold eight series of Bonds in an aggregate principal amount of $350 million of which $130 million presently are outstanding.
It is now proposed that the County will issue and sell an additional series of Bonds in the aggregate principal amount of up to $10 million (“Series L Refunding Bonds”) the proceeds of which will be used to provide for the redemption on or prior to maturity of $10 million principal amount of the Series H Bonds of the County. It is contemplated that the Series L Refunding Bonds will be issued and secured under a supplemental indenture between the County and the Trustee. Appalachian proposes to enter into an amended Sales Agreement in connection with the Series L Refunding under essentially the same terms and conditions of the original Sales Agreement.
It is contemplated that the Series L Refunding Bonds will be sold under arrangements with a group of underwriters with such terms as shall be specified by Appalachian. The Series L Refunding Bonds shall have a stated maturity of no more than forty years, a fixed rate of interest that shall not exceed 8% per annum or an initial rate of interest by any fluctuating rate Bonds that shall not exceed 8%. If it is deemed advisable, the Series L Refunding Bonds may be provided some form of credit enhancement.
The Southern Company (“Southern”), a registered holding company, 270 Peachtree Street, N.W., Atlanta, Georgia 30303, and its public-utility subsidiary companies, Alabama Power Company (“Alabama”), 600 North 18th Street, Birmingham, Alabama 35291, Georgia Power Company (“Georgia”), 241 Ralph McGill Boulevard, N.E., Atlanta, Georgia 30308, Gulf Power Company (“Gulf”), One Energy Place, Pensacola, Florida 32520, Mississippi Power Company (“Mississippi”), 2992 West Beach, Gulfport, Mississippi 39501, Savannah Electric and Power Company (“Savannah”), 600 East Bay Street, Savannah, Georgia 31401, and Southern Electric Generating Company (“SEGCO”),
Applicants seek authority for Southern to organize a new subsidiary company (“NewCo”). Applicants propose that NewCo will undertake the construction and ownership of certain electric power generation facilities interconnected to the transmission systems of the Operating Companies, or to transmission systems interconnected to those of the Operating Companies designed for serving the power requirements of the Operating Companies and of other power purchasers in the region. In addition, Applicants seek authority for NewCo to invest in exempt wholesale generators (“EWGs”), the generation of which may not be interconnected to transmission systems of the Operating Companies. Certain power generation owned by NewCo may be integrated into the power generation owned by the Operating Companies and operated on a central dispatch basis by Southern Company Services, Inc. (“Services”).
Applicants propose that Southern and the Operating Companies will transfer the following asset and types of assets (collectively, the “Plant Sites and Generating Equipment”) to NewCo: Plant Dahlberg in Jackson County, Georgia; plants under construction and/or undeveloped plant sites prior to their becoming utility assets; and existing contracts for wholesale sales of electricity. Georgia is currently developing the Plant Dahlberg facility, an 800 MW simple-cycle natural gas peaking facility located north of Athens, Georgia. The facility will initially consist of ten combustion turbine generating units. Units 1-8 entered commercial operation during May through June, 2000. Units 9 and 10 are scheduled for commercial operation in the spring of 2001. Primary fuel for the units will be natural gas, with No. 2 fuel oil as a backup. The facility is interconnected to the Georgia Integrated Transmission System and the Southern electrical control area via a 230 kV transmission line and is centrally dispatched as part of the Southern control area. Plant Dahlberg will be transferred at the book cost of Georgia, which is estimated to be $275 million, upon completion of Units 9 and 10 in the spring of 2001.
The Plant Sites and Generating Equipment will be transferred or sold to NewCo in an amount equal to the net book value. NewCo will pay cash and/or issue promissory notes, secured by purchase money mortgages on the Plant
Applicants propose to engage in the transactions described below from time to time, as applicable, through June 30, 2005.
Southern seeks financing authority to fund the development and growth of NewCo up to an aggregate amount not to exceed $1.7 billion. The financings will take the form of any combination of: (1) Purchases of or contributions in respect of limited liability company interests or other forms of equity interests; (2) open account advances without interest; (3) loans; and (4) guarantees (as described below) issued in support of securities and other obligations of NewCo. The proceeds of the financings will be used to finance the operations of NewCo including the acquisition, construction and operation of power generation facilities, fuel and power generation equipment procurement and storage, and energy-related activities, including those permitted under rule 58.
Southern and NewCo will maintain the equity component of NewCo's consolidated capitalization at or above 30%. Applicants propose that NewCo be permitted to maintain a common equity component less than 30% and request that the Commission reserve jurisdiction over transactions that will cause the common equity component of NewCo's consolidated capitalization to fall below 30%.
The loans from Southern will provide NewCo with liquidity to facilitate cash management. The loans will be at interest rates and maturities to provide a return to Southern of not less than its effective cost of capital, and will be of a term not to exceed two years.
Guarantees may be used as credit support for NewCo. Southern proposes to issue guarantees or provide other forms of credit support or enhancements (collectively, “Guarantees”) to, or for the benefit of, NewCo. Guarantees will take the form of Southern agreeing to guarantee, to undertake reimbursement obligations, to assume liabilities or to assume other obligations with respect to, or to act as surety on, bonds, letters of credit, evidences of indebtedness, equity commitments, performance and other obligations undertaken by NewCo. The terms and conditions of the Guarantees will be established through arms-length negotiations based upon current market conditions. Any Guarantee issued will be without recourse to any of the Operating Companies.
In connection with its daily operations, financing the acquisition, construction and operation of assets owned by it and its subsidiaries, and to achieve its business goals, NewCo proposes to issue securities up to an aggregate amount of $2.5 billion. This financing is currently expected to take, without limitation, the form of bank loans and/or bank credit support, project financing, lease or sale/leaseback transactions, commercial paper programs, debt secured by NewCo's assets or unsecured debt, notes, debentures, preferred securities, and other equity. In connection with any lease or sale/leaseback transaction, NewCo may transfer or sell utility assets to a third party. NewCo will lease the assets from the third party with an option to buy back the assets. Applicants request that the Commission reserve jurisdiction over the sale/leaseback of any utility assets.
In connection with the issuance of preferred securities, NewCo will organize a special purpose subsidiary (“SPS”) and might organize another special purpose subsidiary for the purpose of complying with applicable state law. A SPS will issue preferred securities to third parties and NewCo will acquire all of the common equity or general partnership interests of the SPS. NewCo will simultaneously issue debt securities to the SPS and may guarantee certain payments with respect to the preferred securities.
In connection with project financing of generating assets, NewCo may acquire securities or other interests in project subsidiaries. In addition, NewCo proposes to incur obligations in connection with the issuance and sale by public instrumentalities of one or more series of revenue bonds.
The interest rate or other distribution rate for NewCo's financings will reflect rates obtained by companies with comparable credit quality. Applicants state that the rate will not exceed the highest of the following rates: (1) 400 basis points over U.S. Treasury securities; (2) a gross spread over U.S. Treasury securities that is consistent with similar securities having comparable maturities; (3) 200 basis points over the prime rate; or (4) 350 basis points over the London Interbank Offered Rate.
NewCo requests authority for it and its subsidiaries (discussed below) to pay dividends to Southern out of capital or unearned surplus to the extent permitted by capitalization and without impairing the rights of the holder of outstanding securities. This will permit NewCo and its subsidiaries to avoid having excess unrestricted cash trapped in subsidiaries.
It is proposed that personnel employed by Services, will provide a wide range of services on an as-needed basis under a service agreement (“Service Agreement”) to be entered into between NewCo and Services. It is also proposed that personnel employed by the Operating Companies will provide services to NewCo under Operating Agreements (the “Operating Agreements”) between NewCo and each Operating Company or other arrangements.
The Service Agreement will take effect upon Commission approval and will be similar in all material respects to those service agreements which Services has signed with each of the Operating Companies. Under the proposed Service Agreement, Services will render to NewCo, at a cost computed in accordance with rules 90 and 91 under the Act and other applicable rules and regulations, various services including general executive and advisory services, power pool operations, general engineering, design engineering, purchasing, accounting, finance and treasury, taxes, insurance and pensions, corporate, rates, budgeting, public relations, employee relations, systems and procedures and other services with respect to business and operations. Services will account for, allocate and charge its costs of the services provided on a full cost reimbursement basis under a work order system consistent with the Uniform System of Accounts for Mutual and Subsidiary Service Companies.
The Operating Agreements will provide that each Operating Company will provide certain services relating to accounting matters and to the construction, operation, maintenance and rehabilitation of assets owned by
NewCo proposes to acquire securities or interests in the business of one or more EWGs, as the term is defined in the Act (the “Exempt Subsidiaries”), either directly or indirectly through project companies (“Intermediate Companies”).
Intermediate Companies will be special purpose subsidiaries formed to engage exclusively in activities to facilitate the consummation of investments in EWGs. They may also engage in development activities. Intermediate Companies may acquire interests in, finance the acquisition of and hold the securities of EWGs. Intermediate Companies will enhance the ability of NewCo to respond quickly to investment opportunities. An Intermediate Company may be organized at the time of the making of bids or proposals to acquire an interest in any EWG or at any time thereafter in order to facilitate the bidding and subsequent consummation of an acquisition of an interest in an EWG.
Applicants also propose that an Intermediate Company will issue equity securities and debt securities to persons other than NewCo or Southern (and with respect to which there will be no recourse to Southern), including banks, insurance companies and other financial institutions, exclusively for the purpose of financing (including any refinancing) investments in EWGs.
Applicants state that the Intermediate Companies will issue securities to Southern and/or NewCo, and Southern and/or NewCo will acquire the securities. The investment by Southern or NewCo in the Exempt Subsidiaries will take the form of capital stock or shares, debt securities, trust certificates, capital contributions, open account advances without interest and partnership interests or other equity or participation interests, bid bonds or other credit support to secure obligations incurred by NewCo and/or Intermediate Companies in connection with Exempt Subsidiary investments or of NewCo's undertaking to contribute equity to an Intermediate Company. Southern and NewCo propose, from time to time through June 30, 2005, to (1) guarantee the indebtedness or other obligations of one or more Exempt Subsidiaries; (2) assume the liabilities of one or more Exempt Subsidiaries; and/or (3) enter into guarantees and letters of credit reimbursement agreements in support of equity contribution obligations or otherwise in connection with project development activities for one or more Exempt Subsidiaries.
Investments will be made from Southern to NewCo and/or Intermediate Companies directly or indirectly. Any open account advance made by Southern will have a maturity of not more than one year.
Applicants propose for Southern to enter into reimbursement agreements with banks to support letters of credit delivered as security for Southern's or NewCo's equity contribution obligation to an Intermediate Company or otherwise in connection with an Intermediate Company's or Exempt Subsidiary's project development activities.
The investment in Intermediate Companies and Exempt Subsidiaries is included in the requested $4.2 billion total financing authority.
For the Commission, by the Division of Investment Management, under delegated authority.
The Securities and Exchange Commission (“Commission”).
Notice of application for an order pursuant to Section 26(b) of the Investment Company Act of 1940 (the “Act”) approving certain substitutions of securities and an order of exemption pursuant to Section 17(b) of the Act from Section 17(a) of the Act.
Applicants request an order to permit a unit investment trust to substitute (a) Shares of North American—Founders Large Cap Growth Fund for shares of Dreyfus Founders Growth Fund; (b) Shares of North American—American Century Income & Growth Fund for shares of Neuberger Berman Guardian Trust and for shares of Scudder Growth and Income Fund; (c) Shares of North American—Founders/T. Rowe Price Small Cap Fund for shares of T. Rowe Price Small-Cap Fund, Inc. and for shares of Dreyfus Variable Investment Fund Small Cap Portfolio (“Dreyfus VIF Small Cap”); (d) Shares of North American—American Century International Growth Fund for shares of Templeton International Securities Fund; (e) Shares of North American—AG Core Bond Fund for shares of American General Domestic Bond Fund; (f) Shares of North American—AG Moderate Growth Lifestyle Fund for shares of American General Balanced Fund; and (g) Shares of North American International Growth Fund for shares of American General International Value Fund. The shares are currently held by that unit investment trust to support certain deferred premium variable annuity contracts (the “Contracts”).
The Variable Annuity Life Insurance Company (“VALIC”); VALIC Separate Account A (the “Account”); North American Funds Variable Product Series I (“NAFV I”) and North American Funds Variable Product Series II (“NAFV II”) (VALIC and the Account are the “Substitution Applicants”; VALIC, the Account, NAFV I and NAFV II are the “Section 17 Applicants”).
The application was filed on March 31, 2000; an amendment substantially conforming to this Notice will be filed during the pendencey of the Notice period.
An order granting the application will be issued unless the Commission orders a hearing. Interested persons may request a hearing by writing to the Secretary of the Commission and serving Applicants with a copy of the request, personally or by mail. Hearing requests should be received by the Commission by 5:30 p.m. on November 16, 2000, and should be accompanied by proof of service on Applicants, in the form of an affidavit or, for lawyers, a certificate of service. Hearing requests should state the nature of the writer's interest, the reason for the request, and the issues contested. Persons may request notification of a hearing by writing to the Secretary of the Commission.
Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609. Applicants: Nori Gabert, Esq., The Variable Annuity Life Insurance Company, 2929 Allen Parkway, Houston, Texas 77019, and David C. Mahaffey, Esq., Sullivan & Worcester LLP, 1025 Connecticut Avenue, NW., Washington, DC 20036.
Keith Carpenter, Branch Chief, or Rebecca A. Marquigny, Senior Counsel
The following is a summary of the application; the complete application may be obtained for a fee from the Public Reference Branch of the Commission, 450 Fifth Street, N.W., Washington, D.C. 20549 (tel. (202) 942-8090).
1. VALIC is a stock life insurance company organized under the Texas Insurance Code. VALIC is an indirect wholly-owned subsidiary of American General Corporation.
2. The Account is registered under the Act as a unit investment trust (File No. 811-03240). The assets of the Account support certain Contracts, and interests in the Account offered through such Contracts have been registered under the Securities Act of 1933 (“1933 Act”) on Form N-4.
3. NAFV I and NAFV II are each registered under the Act as open-end management investment companies of the series type (File Nos. 811-03738 and 811-08789). Securities of NAFV I and NAFV II are also registered under the 1933 Act (File Nos. 2-83631 and 333-53589).
4. The Account currently has 53 sub-accounts, each of which reflects the investment performance of a series of NAFV I or NAFV II, or certain other registered management companies advised by advisers not affiliated with VALIC or the Account.
5. Under the Contracts, VALIC reserves the right to substitute shares of one fund for shares of another.
6. VALIC proposes, as applicable, to substitute (a) Shares of North American—Founders Large Cap Growth Fund for shares of Dreyfus Founders Growth Fund; (b) Shares of North American—American Century Income & Growth Fund for shares of Neuberger Berman Guardian Trust and for shares of Scudder Growth and Income Fund; (c) Shares of North American—Founders/T. Rowe Price Small Cap Fund for shares of T. Row Price Small-Cap Stock Fund, Inc. and for shares of Dreyfus VIF Small Cap; (d) Shares of North American—American Century International Growth Fund for shares of Templeton International Securities Fund; (e) Shares of North American—AG Core Bond Fund for shares of American General Domestic Bond Fund; (f) Shares of North American—AG Moderate Growth Lifestyle Fund for shares of American General Balanced Fund; and (g) Shares of North American International Growth Fund for shares of American General International Value Fund.
7. Except for North American—AG Core Bond Fund, North American—AG Moderate Growth Lifestyle Fund, and North American International Growth Fund, each of which is a series of NAFV II, none of the replacement funds has commenced operations. The Applicants have filed an amendment to the registration statement on Form N-1A of NAFV I to reflect the addition of the new funds (the “New Funds”), which became effective on September 29, 2000.
8. Pursuant to an exemptive order issued to VALIC, NAFV II, and others,
9. The investment objectives, policies and restrictions of the replacement funds are in each case substantially similar to the investment objectives, policies and restrictions of the respective existing funds. The investment objectives of each existing and the corresponding replacement fund are set forth below:
10. Applicants assert that the substitutions are expected to provide significant benefits to Contract owners, including improved selection of portfolio managers and simplification of fund offerings through elimination of overlapping offerings. At the same time, Contract owners will continue to be able to select among a large number of funds, with a full range of investment objectives, investment strategies, and managers.
11. The expenses of the existing funds and the pro forma expenses of the replacement funds are set forth below in the Appendix.
12. By supplements to the various prospectus for the Contracts and the Account, VALIC will notify all owners of the Contracts of its intention to take the necessary actions, including seeking the other requested by this Application, to substitute shares of the funds as described therein. The prospectus supplements for the Account will advise Contract owners that from the date of the supplement until the date of the proposed substitution, owners will be permitted to make transfers among sub-accounts as usual. The supplements will also inform Contract owners that VALIC will not exercise any rights reserved under any Contract to impose additional restrictions on transfers until at least 30 days after the proposed substitution.
13. Within five business days after the proposed substitutions, affected Contract owners will also be provided with a prospectus for the replacement funds.
14. The proposed substitutions will take place at relative net assert value with no change in the amount of any Contract owners's Contract value, cash value or death benefit or in the dollar value of his or her investment in any of the Accounts.
15. The process for accomplishing the transfer of assets from an existing fund to its respective replacement fund will be determined on a case-by-case basis. In certain cases, it is expected that the substitutions will be effected by redeeming shares of an existing fund for cash and using the cash to purchase shares of the replacement fund.
16. In certain other cases, it is expected that the substitutions will be effected by redeeming the shares of an existing fund in-kind; these assets will then be contributed in-kind to the corresponding replacement fund to purchase shares of that fund. All in-kind redemptions from an existing fund of which any of the Substitution Applicants is an affiliated person will be effected in accordance with the conditions set forth in the Commission's no-action letter issued to
17. Contract owners will not incur any fees or charges as a result of the substitutions, nor will their rights or VALIC's obligations under the Contracts be altered in any way. All expenses incurred in connection with the proposed substitutions, including brokerage, legal, accounting and other fees and expenses, will be paid by VALIC. In addition, the proposed substitutions will not impose any tax liability on Contract owners. The supplements will also inform Contract owners that VALIC will not exercise any rights reserved under any Contract to impose additional restrictions on transfers until at least 30 days after the proposed substitution.
18. In addition to the prospectus supplements distributed to owners of Contracts, within five business days after the proposed substitutions, any Contract owners who were affected by the proposed substitutions will be sent a written notice informing them that the proposed substitutions were carried out and that they may make one transfer of all Contract value or cash value under a Contract invested in each of the affected sub-accounts to other available sub-account(s) without regard to any limitations on transfers that would otherwise apply and without charge. The notice will also reiterate the fact that VALIC will not exercise any rights reserved by it under the Contracts to impose additional restrictions on transfers until at least 30 days after the proposed substitutions.
19. Before any of the New Funds may rely on the Multi-Manager Order, the operation of the New Fund as a multi-manager fund, as described in the application for the Multi-Manager Order, will be approved, following the substitutions proposed in this Application, by a majority of that New Fund's outstanding voting securities.
20. Each of the New Funds (North American-Founders/T.Rowe Price Small Cap Fund, North American-American Century Income & Growth Fund, North American-American Century International Growth Fund, and North American-Founders Large Cap Growth Fund) have management fees higher than those of existing funds they will replace. Each such replacement fund will hold a shareholder meeting to approve the investment advisory contract pursuant to Section 15 of the Act within 120 after the substitution occurs. The difference between the management fee paid by the existing fund and the fee payable under the new investment advisory contract will be held in escrow pending the shareholder vote. If the shareholders of a New Fund
21. Applicants further agree that for each of the New Funds, proxy materials will disclose, on a pro forma basis, the amount of the proposed management fee, other fund expenses, and total fund expenses. Applicants agree that VALIC will, for two years from the date of the substitution, limit total fund expenses for each New Fund to the percentage levels set forth in the Application and disclosed in the New Fund's proxy materials. Accordingly, annualized total fund expenses of each New Fund during the two-year period will be capped at the following levels.
22. In addition, in any case in which shareholders of a New Fund do not approve the new investment advisory contract, VALIC agrees that it will limit the annualized management fee of the New Fund to the same level as that of the existing fund and the total annualized expenses of the New Fund to that of the existing fund, adjusted to reflect any reductions in separate account charges that take effect in connection with the substitution. Such limitation will apply until shareholders approve a new investment advisory contract. Accordingly, the total annualized fund expenses of each New Fund in such a case would be as follows:
23. North American—AG Core Bond Fund, North American AG Moderate Growth Lifestyle Fund and North American International Growth Fund have advisory fees lower than the existing funds they will replace. VALIC will cap each such replacement fund's total fund expenses at the same level as the total fund expenses of the respective existing fund (net of any waivers or reimbursements) at least until the end of the fiscal year ending August 31, 2002.
Accordingly, annualized total fund expenses will be capped at the following levels for the period ending August 31, 2002.
24. Applicants further agree that VALIC will not increase total separate account charges (net of any waivers or reimbursements) for any of the Contracts involved in the substitution for a period of two years from the date of the substitution. Accordingly, total annualized separate account charges (net of any waivers or reimbursements) during the two year period will not exceed the following levels:
1. Section 26(b) of the Act requires the depositor of a registered unit investment trust holding the securities of a single issuer to obtain Commission approval before substituting the securities held by the trust. Specifically, Section 26(b) states:
It shall be unlawful for any depositor or trustee of a registered unit investment trust holding the security of a single issuer to substitute another security for such security unless the Commission shall have approved such substitution. The Commission shall issue an order approving such substitution if the evidence establishes that it is consistent with the protection of investors and the purposes fairly intended by the policy and provisions of this title.
2. The Substitution Applicants state that the proposed substitutions appear to involve substitutions of securities within the meaning of Section 26(b) of the Act and request that the Commission issue an order pursuant to Section 26(b) of the Act approving the proposed substitutions.
3. The Contracts expressly reserve for VLAIC the right, subject to Commission approval, to substitute shares of another Management Company for shares of a Management Company held by a sub-account of the Account.
4. The Substitution Applicants request an order of the Commission pursuant to Section 26(b) of the Act approving the proposed substitutions by VALIC. The Substitution Applicants assert that the proposed substitutions are consistent with the protection of investors and the purposes fairly intended by the policy and provisions of the Act.
5. The Substitution Applicants assert that each of the proposed substitutions is not the type of substitution which Section 26(b) was designed to prevent. Unlike traditional unit investment trusts where a depositor could only substitute an investment security in a manner which permanently affected all the investors in the trust, the Contracts provide that each Contract owner has the right to exercise his or her own judgment and transfer Contract or cash value into other sub-accounts. Moreover, the Contracts will offer Contract owners the opportunity to transfer amounts out of the affected sub-accounts into any of the remaining sub-accounts without cost or other disadvantage. The Substitution Applicants assert that the proposed substitutions, therefore, will not result in the type of costly forced redemption which Section 26(b) was designed to prevent.
6. The Substitution Applicants assert that proposed substitutions also are unlike the type of substitution which Section 26(b) was designed to prevent in that by purchasing a Contract, Contract owners select much more than a particular investment company in which to invest their account values. They also select the specific type of insurance coverage offered by VALIC under their Contract as well as numerous other rights and privileges set forth in the Contract. Contract owners may also have considered VALIC's size, financial condition, and its reputation for service in selecting their Contract. These factors will not change as a result of the proposed substitutions.
7. Section 17(a)(1) of the Act, in relevant part, prohibits any affiliated person of a registered investment company, or any affiliated person of such person, acting as principal, from knowingly selling any security or other property to that company. Section 17(a)(2) of the Act generally prohibits the persons described above, acting as principals, from knowingly purchasing any security or other property form the registered company.
8. Section 2(a)(3) of the Act defines the term “affiliated person of another person” in relevant part as:
(A) any person directly or indirectly owning, controlling, or holding with power to vote, 5 per centum or more of the outstanding voting securities of such person; (B) any person 5 per centum or
Section 2(a)(9) of the Act states that any person who owns beneficially, either directly or through one or more controlled companies, more than 25% of the voting securities of a company shall be presumed to control such company.
9. Because shares held by a separate account of an insurance company are legally owned by the insurance company, VALIC owns of record substantially all of the shares of NAFV I and NAFV II. Therefore, NAFV I and NAFV II and their respective funds are arguably under the control of VALIC notwithstanding the fact that Contract owners may be considered the beneficial owners of those shares held in the Account. If NAFV I and NAFV II and their respective funds are under VALIC control, then VALIC is an affiliated person of NAFV I and NAFV II and their respective funds. If NAFV I and NAFV II and their respective funds are under VALIC control, then NAFV I and NAFV II and their respective funds are affiliated person of each other.
10. Regardless of whether or not VALIC can be considered to control NAFV I and NAFV II and their respective funds, because VALIC owns of record more than 5% of the shares of each of them and is each replacement fund's investment adviser, VALIC is an affiliated person of both NAFV I and NAFV II and their respective Funds. Likewise, their respective funds are each an affiliated person of an affiliated person of each other.
11. Because the substitutions may be effected, in whole or in part, by means of in-kind redemptions and purchases, the substitutions may be deemed to involve one or more purchases or sales of securities or property between affiliated persons or between affiliated persons of affiliated persons. The proposed transactions may involve a transfer of portfolio securities by the existing funds to the Account; immediately thereafter, the Account would purchase shares of the replacement funds with the portfolio securities received from the existing funds. Accordingly, as the Account and the replacement funds could be viewed as affiliated persons of one another under Section 2(a)(3) of the Act, it is conceivable that this aspect of the substitutions could be viewed as being prohibited by Section 17(a). Accordingly, the Section 17 Applicants have determined that it is prudent to seek relief from Section 17(a) in the context of this Application for the in-kind purchases and sales of the replacement fund shares.
12. Section 17(b) of the Act provides that the Commission may, upon application, grant an order exempting any transaction from the prohibitions of Section 17(a) if the evidence establishes that: (a) The terms of the proposed transaction, including the consideration to be paid or received, are reasonable and fair and do not involve overreaching on the part of any person concerned; (b) the proposed transaction is consistent with the policy of each registered investment company concerned, as recited in its registration statement and records filed under the Act, and (c) the proposed transaction is consistent with the general purposes of the Act.
13. The Section 17 Applicants submit that the terms of the proposed in-kind purchases of shares of the replacement funds by the Account, including the consideration to be paid and received, as described in this Application, are reasonable and fair and do not involve overreaching on the part of any person concerned. The Section 17 Applicants also submit that the proposed in-kind purchases by VALIC are consistent with the policies of each of the replacement funds. Finally, the Section 17 Applicants submit that the proposed substitutions are consistent with the general purposes of the Act.
Applicants assert that, for the reasons summarized above, the proposed substitutions and related transactions meet the standards of Section 26(b) of the Act and are consistent with the standards of Section 17(b) of the Act and that the requested orders should be granted.
For the Commission, by the Division of Investment Management pursuant to delegated authority.
Tennessee Valley Authority (TVA).
Notice of Intent.
This notice is provided in accordance with the Council on Environmental Quality's regulations (40 CFR Parts 1500 to 1508) and TVA's procedures implementing the National Environmental Policy Act. TVA will prepare an Environmental Impact Statement (EIS) on alternatives for a requested land exchange by Montana Land Company, L. L. C. (MLC) involving 22 acres of TVA land on Pickwick Reservoir, which is proposed to be exchanged for 164 acres of property, also on Pickwick Reservoir, in Hardin County, Tennessee.
Comments on the scope of the EIS must be received on or before November 30, 2000.
Written comments should be sent to Jon M. Loney, Manager, NEPA Administration, Environmental Policy and Planning, Tennessee Valley Authority, 400 West Summit Hill Drive, Knoxville, Tennessee 37902-1499.
Harold M. Draper, NEPA Specialist, Environmental Policy and Planning, Tennessee Valley Authority, 400 West Summit Hill Drive, WT 8C, Knoxville, Tennessee 37902-1499; telephone (865) 632-6889 or e-mail hmdraper@tva.gov.
Pickwick Reservoir is an impoundment of the Tennessee River formed by Pickwick Landing Dam, which is located at Tennessee River Mile (TRM) 206.7 in Hardin County, Tennessee. Pickwick Reservoir is located in parts of three States—Alabama, Mississippi, and Tennessee. The Tennessee Valley Authority (TVA) originally acquired 63,625 acres of land for construction of the reservoir, which was begun in December 1934 and completed in February 1938. TVA has retained 17,358 acres of land lying above full pool elevation. At full pool, the reservoir is 52.7 miles long, shoreline length is 490.6 miles, and surface area is 43,100 acres.
In the late 1980s, private developers began construction on a residential and resort subdivision consisting of 3,000 acres and extending for 11.5 miles along the shoreline of lower Pickwick Reservoir. This development was named Points of Pickwick. The project features waterfront lots, waterview lots, interior single family lots, zero lot line developments, condominium residences, an 18-hole championship golf course, underground utilities, a community marina, and nature trails. In 1995, MLC acquired the property and has continued subdivision development. TVA owns land along two embayments, Lower Anderson Branch and Haw Branch, which extend into this development. No private shoreline access rights exist across the TVA parcels. Shoreline access rights exist across a narrow TVA-owned shoreline band adjoining MLC properties, including the parcel proposed to be exchanged with TVA.
In 1999, TVA completed an EIS on residential shoreline development impacts throughout the Tennessee Valley. The Record of Decision (ROD) was published at 64 FR 30092-30094. In order to limit the eventual development of shoreline and accompanying impacts to aquatic ecology, water quality, scenic beauty, and other valuable resources, the ROD indicated that TVA would adopt a strategy of “maintaining and gaining” public shoreline. Under this strategy, TVA agreed to consider
In 1981, TVA published a land allocation plan for Pickwick Reservoir. The Pickwick Reservoir Plan allocated the tract on Lower Anderson Branch (Planned Tract 1, 12 acres) as open space and the tract on Haw Branch (Planned Tract 2, 36 acres) as open space and a safety harbor. These tracts are located in Hardin County, Tennessee on the right bank near Tennessee River Mile (TRM) 210.0.
After reviewing TVA's Shoreline Management decision, MLC made a request for fee transfer of Planned Tract 1 (Lower Anderson Branch) and Planned Tract 2 (Haw Branch) in exchange for approximately 160 acres of MLC-owned land. TVA solicited comments on this proposal through a public notice in July 2000. The response to this notice indicated that there were concerns over whether the project was an equitable trade and whether the exchange would be environmentally beneficial. In addition, the initial environmental evaluation has revealed concerns over the impacts of exchanging highly visible public land on the main reservoir for lands at the back of a cove. Because of the potential environmental benefits of a gain in public land on lower Pickwick Reservoir, TVA has decided to continue consideration of this request. However, because of concerns about the significance of the impacts should residential development occur on the two tracts proposed for exchange, TVA has elected to prepare an Environmental Impact Statement to better understand the impacts of the proposal.
At this time, TVA anticipates that three alternatives would be analyzed in the EIS. Under No Action, TVA would not amend the Pickwick Reservoir Plan and would not exchange the two tracts of TVA land. A second alternative would consider the original request by the developer for 48 acres of TVA land in exchange for approximately 122 acres of privately-owned property in Haw Branch. A third alternative would consider the developer's request and mitigation measures to reduce environmental impacts. This would include 22 acres of TVA in exchange for 164 acres of privately-owned property, along with 50-foot shoreline buffer management zones and community water-use facilities.
Based on the results of the previous public meeting and subsequent public comments, TVA anticipates that the EIS will include discussion of the potential effects of alternatives on the following resources and issue areas: visual resources, cultural resources, threatened and endangered species, terrestrial ecology, wetlands, recreation, water quality, aquatic ecology, and socioeconomics. Other issues which may be discussed, depending on the potential impacts of the alternatives, include floodplains and air quality.
TVA is interested in receiving additional comments on the scope of issues to be addressed in the EIS. Written comments on the scope of the EIS should be received on or before November 30, 2000. Following completion of the Draft EIS, an additional opportunity to review and comment on the proposal will be provided at that time.
Office of the United States Trade Representative.
Notice.
This notice announces a process for considering changes to the product eligibility list for India under the Generalized System of Preferences (GSP) program; lists the schedule for the public hearing that is part of this process, for requesting participation in the hearing and for submitting pre-hearing and post-hearing briefs.
GSP Subcommittee, Office of the United States Trade Representative, 600 17th Street, NW, Room 518, Washington, DC 20508. The telephone number is (202) 395-6971.
The GSP program grants duty-free treatment to designated eligible articles that are imported from designated beneficiary developing countries. The GSP program is authorized by Title V the Trade Act of 1974, as amended (“Trade Act”) (19 U.S.C. 2461
It is expected that decisions on both issues will be made on or about April 1, 2001. Each process will be conducted to meet that timetable.
The GSP Subcommittee of the TPSC invites comments in support of, or in opposition to, the redesignations and CNL waivers which are the subject of this notice. Submissions should comply with 15 CFR part 2007, including §§ 2007.0, and 2007.1. All submissions should identify the subject article(s) in terms of the current Harmonized Tariff Schedule of the United States (“HTS”) nomenclature.
Comments should be submitted in fourteen (14) copies in English, to the chairman of the GSP Subcommittee of the Trade Policy Staff Committee, 600 17th Street, NW, Room 518, Washington, DC 20508. Information submitted will be subject to public inspection by appointment with the staff of the USTR public reading room, except for information granted “business confidential”status pursuant to 15 CFR 2003.6 and other qualifying information submitted in confidence pursuant to 15 CFR 2007.7. If the document contains confidential information, an original and fourteen (14) copies of a nonconfidential version of the submission along with an original
Hearings will be held on January 5, 2001 beginning at 10:00 a.m. at the Office of the United States Trade Representative, White House Conference Center, Truman Room, 726 Jackson Place, NW., Washington, DC 20508. The hearings will be open to the public and a transcript of the hearings will be made available for public inspection or can be purchased from the reporting company. No electronic media coverage will be allowed.
All interested parties wishing to present oral testimony at the hearings must submit the name, address, and telephone number of the witnesses representing their organization to the Chairman of the GSP Subcommittee. Such requests to present oral testimony at the public hearings should be accompanied by fourteen (14) copies, in English, of a written brief or statement, and should be received by 5 p.m. on December 6, 2000. Oral testimony before the GSP Subcommittee will be limited to five minute presentations that summarize or supplement information contained in the briefs or statements submitted for the record. Post-hearing and rebuttal briefs or statements should conform to the regulations cited above and be submitted in fourteen (14) copies, in English, no later than 5 p.m. February 2, 2001. Interested persons not wishing to appear at the public hearings may also submit pre-hearing written briefs or statements by 5 p.m. on December 6, 2000, and post-hearing and rebuttal written briefs or statements by February 2, 2001. Comments by interested persons on the USITC Report prepared as part of the product review should be submitted in fourteen (14) copies, in English, by 5 p.m. on February 28, 2001.
Federal Motor Carrier Safety Administration (FMCSA), DOT.
Notice and request for comments.
This action informs the public that FMCSA intends to request the Office of Management and Budget (OMB) to renew approval for the information collection required by the Motor Carrier Safety Assistance Program. That information consists of grant application preparation, quarterly reports, and electronic data documenting the results of driver/vehicle inspections performed by the states. This notice is required by the Paperwork Reduction Act.
You must submit comments by January 2, 2001.
Mail or hand deliver comments to the U.S. Department of Transportation, Dockets Management Facility, Room PL-401, 400 Seventh Street, SW., Washington, DC 20590, or submit electronically at
James D. McCauley, (202) 366-0133, Office of Safety Programs, Federal Motor Carrier Safety Administration, Department of Transportation, 400 Seventh Street, SW., Washington, DC, 20590. Office hours are from 7:30 a.m. to 4 p.m., e.t., Monday through Friday, except Federal holidays.
The Transportation Equity Act for the 21st Century (TEA-21) further revised the MCSAP by broadening its purpose beyond enforcement activities and programs by requiring participating states to assume greater responsibility for improving motor carrier safety. The TEA-21 required states to develop performance-based plans reflecting national priorities and performance goals, revised the MCSAP funding distribution formula, and created a new incentive funding program. As a result, States are given greater flexibility in designing programs to address national and State goals for reducing the number and severity of commercial motor vehicle (CMV) accidents. The implementing regulations were published in a final rule in the March 21, 2000,
In order to qualify for a grant, participating states must submit a Commercial Vehicle Safety Plan (CVSP). After the grant is awarded, states must submit inspection data and quarterly reports explaining work activities and accomplishments. The FMCSA monitors and evaluates a state's progress under its approved CVSP. The agency also determines whether a change in the state's level of effort is required to meet the intended objectives of the CVSP. If a state fails to operate within the guidelines of the approved CVSP or does not remedy any identified deficiencies or incompatibilities in a timely manner, the FMCSA may cease participation in that state's CVSP. This information collection provides the basis for these responsibilities and decisions.
The quarterly report and inspection data are collected electronically. States continue to submit the CVSP in hard copy. The estimated annual burden for this collection has been significantly reduced due to increased use of information technology.
An electronic copy of this document may be downloaded by using a computer, modem and suitable communications software from the Government Printing Office's Electronic Bulletin Board Service at (202) 512-1661. Internet users may reach the Office of the Federal Register's home page at
The Paperwork Reduction Act of 1995, 44 U.S.C. Chapter 35, as amended; and 49 CFR 1.73.
CSX Transportation, Inc. (CSXT) has filed a notice of exemption under 49 CFR 1152 Subpart F—
CSXT has certified that: (1) No local traffic has moved over the line for at least 2 years; (2) there is no overhead traffic on the line; (3) no complaint filed by a user of rail service on the line (or by a state or local government entity acting on behalf of such user) regarding cessation of service over the line either is pending with the Surface Transportation Board (Board) or with any U.S. District Court or has been decided in favor of complainant within the 2-year period; and (4) the requirements at 49 CFR 1105.7 (environmental reports), 49 CFR 1105.8 (historic reports), 49 CFR 1105.11 (transmittal letter), 49 CFR 1105.12 (newspaper publication), and 49 CFR 1152.50(d)(1) (notice to governmental agencies) have been met.
As a condition to this exemption, any employee adversely affected by the abandonment shall be protected under
Provided no formal expression of intent to file an offer of financial assistance (OFA) has been received, this exemption will be effective on December 1, 2000, unless stayed pending reconsideration. Petitions to stay and formal expressions of intent to file an OFA under 49 CFR 1152.27(c)(2)
A copy of any petition filed with the Board should be sent to applicant's representative: Natalie S. Rosenberg, Counsel, CSX Transportation, Inc., 500 Water Street J150, Jacksonville, FL 32202.
If the verified notice contains false or misleading information, the exemption is void
Board decisions and notices are available on our website at “WWW.STB.DOT.GOV.”
By the Board, David M. Konschnik, Director, Office of Proceedings.
This directive establishes the Department's policy for alternative workplace arrangements. It authorizes the use of Telework programs by Treasury bureaus and offices by permitting employees to work full or part-time at approved locations other than their official duty station. This directive sets forth a program that provides an opportunity for an employee to work at an alternative work site without changing an employee's official duty station or other conditions of employment.
It is the policy of the Department of the Treasury to provide employees the opportunity to utilize technology in order to participate in Telework programs where practical and consistent with agency mission. Consistent with the guidance set forth in this directive, each Treasury bureau or office shall establish a Telework program that permits it to meet its specific mission while supporting teleworking.
Teleworking is a flexible arrangement that allows an employee to work away from the traditional office or official duty station in either (1) his/her home, (2) a Telework center, such as those established by the General Services Administration (GSA) or, (3) a virtual or mobile office setting. Telework programs may be designed to allow employees to work full or part-time, depending on the mission of the bureau and the roles and responsibilities of a particular office and its employees.
Programs may be designed for purposes such as: (1) Improving the bureau's ability to recruit and retain employees in a highly competitive market, (2) achieving cost savings by reducing real property needed for office space, (3) increasing employee morale and productivity, (4) and reducing traffic congestion, energy consumption, and air pollution.
The following are definitions of terms used in this document:
a.
b.
c.
e.
a.
b.
(1) designate:
(a) a Departmental coordinator to serve as primary contact, and
(b) Program Managers to provide information and support resources to assist in the organization and implementation of Telework programs throughout the Department;
(2) identify training and support resources, and coordinate Treasury initiatives and reports as required.
c.
d.
(1) establish Telework programs at all bureau/office locations where possible and appropriate to bureau/office mission;
(2) appoint one or more Bureau/Office Telework Coordinator(s) to serve as contact and liaison between the Department and the bureau/office;
(3) within 90 days of the effective date of this directive, establish a bureau/office baseline on employee Telework participation, to be used in program evaluations and future progress reports;
(4) submit annual reports within 30 days of the end of the fiscal year to the Departmental Coordinators on the status of the bureau/office Telework program; and
(5) complete all labor relations responsibilities.
a. Participation in a telework arrangement is not an employee entitlement. An employee may participate in the program if the responsible supervisor or designee decides that the employee's job duties are appropriate for offsite work
b. The telework arrangement under which an employee will perform work must be clearly set forth in a written agreement and signed by the respective supervisor and employee. The agreement must specify:
(1) The alternative work site (
(2) Specific hours and days per week to be worked at the alternate work place,
(3) Pertinent office equipment to be provided and by whom,
(4) Method of communication to be used between the official duty station and alternate work place, and
(5) Duties to be performed and methods of evaluation to be employed.
c. A Telework arrangement does not alter the terms and conditions of appointment, including an employee's official duty station, salary, benefits, individual rights, or obligations. All pay, leave, and travel entitlement shall be based on the official duty station. The Telework arrangement shall not affect other conditions of employment,
d. Upon appropriate notice the bureau (manager) or designee, has the right to inspect the home or alternate work site and equipment to be used by an employee to ensure that proposed work space is safe, and all equipment is adequately installed and performing properly.
e. The Telework agreement between employee and supervisor may be terminated at the discretion of the supervisor.
f. The Telework arrangement shall be for the performance of official duties and shall not be treated as an opportunity to conduct personal business.
g. Each bureau/office may issue additional criteria in accordance with this Directive and with Treasury Publication TD P 74-14, Department of Treasury Telework Handbook, which provides additional general information and guidance regarding Telework programs. This manual is available through the Department's Office of Asset Management and the Office of the Deputy Assistant Secretary for Human Resources.
a. Federal Employees Clean Air Incentives Act, (Pub. L. 103-172 (November 11, 1993).
b. Memorandum on Expanding Family-Friendly Work Arrangements in the Executive Branch, 30 Weekly Comp. Pres. Doc. 1468 (July 11, 1994).
c. Memorandum Implementing Federal Family Friendly Work Arrangements, 32 Weekly Comp. 1119 (June 21, 1996).
d. National Telecommuting Initiative Action Plan, (President's Management Council, January 1996).
Office of the Assistant Secretary for Management and Chief Financial Officer, Office of the Deputy Assistant Secretary (Human Resources), Office of the Deputy Assistant Secretary (Management Operations), and Office of Asset Management.
Department of the Treasury; Departmental Offices.
Notice.
The Department of the Treasury is announcing that it will shortly prescribe procedures for making payments to persons who hold certain categories of judgments against Cuba or Iran.
Alexandra Edsall, Senior Advisor to the General Counsel, Department of the Treasury, 1500 Pennsylvania Avenue, NW., Room 3018, Washington, DC 20220, telephone (202) 622-2744 (not a toll-free call).
Section 2002 of the Victims of Trafficking and Violence Protection Act of 2000 directs the Secretary of the Treasury to make payments to persons who hold certain categories of judgments against Cuba or Iran in suits brought under 28 U.S.C. 1605(a)(7). Promptly after enactment, the Department of the Treasury will publish a notice in the
Health Care Financing Administration (HCFA), HHS.
Final rule with comment period.
This final rule with comment period makes several changes affecting Medicare Part B payment. The changes include: refinement of resource-based practice expense relative value units (RVUs); the geographic practice cost indices; resource-based malpractice RVUs; critical care RVUs; care plan oversight and physician certification and recertification for home health services; observation care codes; ocular photodynamic therapy and other ophthalmological treatments; electrical bioimpedance; antigen supply; and the implantation of ventricular assist devices. This rule also addresses the comments received on the May 3, 2000 interim final rule on the supplemental survey criteria and makes modifications to the criteria for data submitted in 2001. Based on public comments we are withdrawing our proposals related to the global period for insertion, removal, and replacement of pacemakers and cardioverter defibrillators and low intensity ultrasound. This final rule also discusses or clarifies the payment policy for incomplete medical direction, pulse oximetry services, outpatient therapy supervision, outpatient therapy caps, HCPCS “G” Codes, and the second 5-year refinement of work RVUs for services furnished beginning January 1, 2002. In addition, we are finalizing the calendar year (CY) 2000 interim physician work RVUs and are issuing interim RVUs for new and revised codes for CY 2001. We are making these changes to ensure that our payment systems are updated to reflect changes in medical practice and the relative value of services. This final rule also announces the CY 2001 Medicare physician fee schedule conversion factor under the Medicare Supplementary Medical Insurance (Part B) program as required by section 1848(d) of the Social Security Act. The 2001 Medicare physician fee schedule conversion factor is $38.2581.
Mail written comments (1 original and 3 copies) to the following address only: Health Care Financing Administration, Department of Health and Human Services, Attention: HCFA-1120-FC, P.O. Box 8013, Baltimore, MD 21244-8013.
Please allow sufficient time for mailed comments to be timely received in the event of delivery delays. If you prefer, you may deliver your written comments by courier (1 original and 3 copies) to one of the following addresses:
Room 443-G, Hubert H. Humphrey Building, 200 Independence Avenue, SW., Washington, DC 20201 or Room C5-14-03, 7500 Security Boulevard, Baltimore, MD 21244.
Comments mailed to the two above addresses may be delayed and received too late to be considered. Because of staff and resource limitations, we cannot accept comments by facsimile (FAX) transmission. In commenting, please refer to file code HCFA-1120-FC. Comments received timely will be available for public inspection as they are received, generally beginning approximately 3 weeks after publication of a document, in Room 443-G of the Department's office at 200 Independence Avenue, SW., Washington, DC, on Monday through Friday of each week from 8:30 to 5 p.m. (phone: (202) 690-7890).
Carolyn Mullen, (410) 786-4589 or Marc Hartstein, (410) 786-4539, (for issues related to resource-based practice expense relative value units).
Kenneth Marsalek, (410) 786-4502 (for issues related to supplemental practice expense survey data).
Bob Ulikowski, (410) 786-5721 (for issues related to resource-based malpractice relative value units and geographic practice cost index changes).
Rick Ensor, (410) 786-5617 (for issues related to care plan oversight and physician certification/recertification).
Cathleen Scally, (410) 786-5714 (for issues related to observation care codes).
Jim Menas, (410) 786-4507 (for issues related to incomplete medical direction and the 5-year review).
Roberta Epps, (410) 786-4503 (for issues related to outpatient/therapy).
Marc Hartstein, (410) 786-4539 (for issues related to the physician fee schedule update, the sustainable growth rate, the conversion factor, and the regulatory impact analysis).
Diane Milstead, (410) 786-3355 (for all other issues).
Copies: To order copies of the
To order the disks containing this document, send your request to: Superintendent of Documents, Attention: Electronic Products, P.O. Box 37082, Washington, DC 20013-7082. Please specify, “Medicare Program; Revisions to Payment Policies Under the Physician Fee Schedule for Calendar Year 2001,” and enclose a check or money order payable to the Superintendent of Documents, or enclose your VISA, Discover, or MasterCard number and expiration date. Credit card orders can be placed by calling the order clerk at (202) 512-1530 (or toll free at 1-888-293-6498) or by faxing to (202) 512-1262. The cost of the four disks is $25.
This
Information on the physician fee schedule can be found on our homepage. You can access this data by using the following directions:
1. Go to the HCFA homepage (http://www.hcfa.gov).
2. Click on “Medicare.”
3. Click on “Professional/Technical Information.”
4. Select Medicare Payment Systems.
5. Select Physician Fee Schedule.
To assist readers in referencing sections contained in this preamble, we are providing the following table of contents. Some of the issues discussed in this preamble affect the payment policies but do not require changes to the regulations in the Code of Federal Regulations. Information on the regulations impact appears throughout the preamble and is not exclusively in section X.
In addition, because of the many organizations and terms to which we refer by acronym in this final rule, we are listing these acronyms and their corresponding terms in alphabetical order below:
Since January 1, 1992, Medicare has paid for physicians' services under section 1848 of the Social Security Act (the Act), “Payment for Physicians' Services.” This section contains three major elements—(1) a fee schedule for the payment of physicians' services; (2) a sustainable growth rate for the rates of increase in Medicare expenditures for physicians' services; and (3) limits on the amounts that nonparticipating physicians can charge beneficiaries. The Act requires that payments under the fee schedule be based on national uniform relative value units (RVUs) based on the resources used in furnishing a service. Section 1848(c) of the Act requires that national RVUs be established for physician work, practice expense, and malpractice expense.
Section 1848(c)(2)(B)(ii)(II) of the Act provides that adjustments in RVUs may not cause total physician fee schedule payments to differ by more than $20 million from what they would have been had the adjustments not been made. If adjustments to RVUs cause expenditures to change by more than $20 million, we must make adjustments to the conversion factors (CFs) to preserve budget neutrality.
In the July 2000 proposed rule (65 FR 44177), we listed all of the final rules published through November 1999, relating to the updates to the RVUs and revisions to payment policies under the physician fee schedule. In the July 2000 proposed rule (65 FR 44176), we discussed several issues affecting Medicare payment for physicians' services, including:
Refinement of resource-based practice expense RVUs;
• Changes to the geographic practice cost indices;
• Resource-based malpractice RVUs;
• Critical care RVUs;
• Care plan oversight and physician certification/recertification;
• Observation care codes;
• Ocular photodynamic therapy and other ophthalmological treatments;
• Electrical bioimpedance;
• The global period for insertion, removal, and replacement of pacemakers and cardioverter defibrillators;
• Antigen supply;
• Low intensity ultrasound; and
• The implantation of ventricular assist devices.
This proposed rule also discussed or clarified the payment policy for incomplete medical direction, pulse oximetry services, outpatient therapy supervision, outpatient therapy caps, and the second 5-year refinement of work RVUs for services furnished beginning January 1, 2002.
This final rule affects the regulations set forth at part 410, Supplementary medical insurance (SMI) benefits and part 414, Payment for Part B medical and other services.
The information in this final rule updates information in the July 2000 proposed rule and the May 3, 2000 interim final rule with comment period (65 FR 25664) discussed later.
Under the formula set forth in section 1848(b)(1) of the Act, the payment amount for each service paid under the physician fee schedule is the product of three factors—(1) a nationally uniform relative value for the service; (2) a geographic adjustment factor (GAF) for each physician fee schedule area; and (3) a nationally uniform CF for the service. The CF converts the relative values into payment amounts.
For each physician fee schedule service, there are three relative values—(1) an RVU for physician work; (2) an RVU for practice expense; and (3) an RVU for malpractice expense. For each of these components of the fee schedule there is a geographic practice cost index (GPCI) for each fee schedule area. The GPCIs reflect the relative costs of practice expenses, malpractice insurance, and physician work in an area compared to the national average for each component.
The general formula for calculating the Medicare fee schedule amount for a given service in a given fee schedule area can be expressed as:
The CF for CY 2001 appears in section V. The RVUs for CY 2001 are in Addendum B. The GPCIs for CY 2001 can be found in Addendum E.
Section 1848(e) of the Act requires us to develop GAFs for all physician fee schedule areas. The total GAF for a fee schedule area is equal to a weighted average of the individual GPCIs for each of the three components of the service. Thus, the GPCIs reflect the relative practice expenses, malpractice insurance, and physician work in an area compared to the national average. In accordance with the statute, however, the GAF for the physician's work reflects one-quarter of the relative cost of physician's work compared to the national average.
Approximately 7,500 codes represent services included in the physician fee schedule. The work RVUs established for the implementation of the fee schedule in January 1992 were developed with extensive input from the physician community. A research team at the Harvard School of Public Health developed the original work RVUs for most codes in a cooperative agreement with us. In constructing the vignettes for the original RVUs, Harvard worked with panels of expert physicians and obtained input from physicians from numerous specialties.
The RVUs for radiology services were based on the American College of Radiology (ACR) relative value scale, which we integrated into the overall physician fee schedule. The RVUs for anesthesia services were based on RVUs from a uniform relative value guide. We established a separate CF for anesthesia services while we continue to recognize time as a factor in determining payment for these services. As a result, there is a separate payment system for anesthesia services.
Section 121 of the Social Security Act Amendments of 1994 (Pub. L. No. 103-432), enacted on October 31, 1994, required us to develop a methodology for a resource-based system for determining practice expense RVUs for each physician service. As amended by the Balanced Budget Act of 1997 (BBA) (Pub. L. No. 105-33), section 1848(c) required the new payment methodology to be phased in over 4 years, effective for services furnished in 1999, with resource-based practice expense RVUs becoming fully effective in 2002. The BBA also requires us to implement resource-based malpractice RVUs for services furnished beginning in 2000.
In response to the publication of the July 2000 proposed rule, we received approximately 600 comments. We received comments from individual physicians, health care workers, and professional associations and societies. The majority of comments addressed the proposals related to practice expense, observation care, antigen supplies, care plan oversight, and certification and recertification of home health services.
The proposed rule discussed policies that affected the number of RVUs on which payment for certain services would be based. Certain changes implemented through this final rule are subject to the $20 million limitation on annual adjustments contained in section 1848(c)(2)(B)(ii)(II) of the Act.
After reviewing the comments and determining the policies we would implement, we have estimated the costs and savings of these policies, and added those costs and savings to the estimated costs associated with any other changes in RVUs for 2001. We discuss in detail the effects of these changes in the Regulatory Impact Analysis (section X).
For the convenience of the reader, the headings for the policy issues correspond to the headings used in the July 2000 proposed rule. More detailed background information for each issue can be found in the May 2000 interim final rule with comment period and the July 2000 proposed rule.
Section 121 of the Social Security Act Amendments of 1994 (Pub. L. No. 103-432), enacted on October 31, 1994, required us to develop a methodology for a resource-based system for determining practice expense RVUs for each physician's services beginning in 1998. In developing the methodology, we were to consider the staff, equipment, and supplies used in furnishing medical and surgical services in various settings. The legislation specifically required that, in implementing the new system of practice expense RVUs, we must apply the same budget-neutrality provisions
Section 4505(a) of the BBA delayed the effective date of the resource-based practice expense RVU system until January 1, 1999. In addition, section 4505(b) of the BBA provided for a 4-year transition period from charge-based practice expense RVUs to resource-based RVUs. The practice expense RVUs for CY 1999 were the product of 75 percent of charge-based RVUs and 25 percent of the resource-based RVUs. For CY 2000, the RVUs were 50 percent charge-based and 50 percent resource-based. For CY 2001, the RVUs are 25 percent charge-based and 75 percent resource-based. After CY 2001, the RVUs will be totally resource-based.
Section 4505(e) of the BBA provided that, in 1998, the practice expense RVUs would be adjusted for certain services in anticipation of the implementation of resource-based practice expenses beginning in 1999. As a result, we increased practice expense RVUs for office visits. For other services in which practice expense RVUs exceeded 110 percent of the work RVUs and were furnished less than 75 percent of the time in an office setting, we reduced the 1998 practice expense RVUs to a number equal to 110 percent of the work RVUs. This limitation did not apply to services that had proposed resource-based practice expense RVUs that increased from their 1997 practice expense RVUs as reflected in the June 18, 1997 proposed rule (62 FR 33196). The services affected, and the final RVUs for 1998, were published in the October 1997 final rule (62 FR 59103).
The most recent legislation affecting resource-based practice expense was included in the Balanced Budget Refinement Act of 1999 (BBRA) (Pub. L. No. 106-113). Section 212 of the BBRA stated that we must establish a process under which we accept and use, to the maximum extent practicable and consistent with sound data practices, data collected or developed by entities and organizations. These data would supplement the data we normally collect in determining the practice expense component of the physician fee schedule for payments in CY 2001 and CY 2002.
Effective with services on or after January 1, 1999, we established a new methodology for computing resource-based practice expense RVUs that used the two significant sources of actual practice expense data we have available: the Clinical Practice Expert Panel (CPEP) data and the AMA's Socioeconomic Monitoring System (SMS) data. The methodology is based on an assumption that current aggregate specialty practice costs are a reasonable way to establish initial estimates of relative resource costs of physicians' services across specialties. It then allocates these aggregate specialty practice costs to specific procedures and, thus, can be considered as a “top-down” approach. The methodology can be summarized as follows:
• Step (1) We used the AMA's SMS survey of actual cost data to determine practice expenses per hour by cost category. The practice expenses per hour for each physician respondent's practice was calculated as the practice expenses for the practice divided by the total number of hours spent in patient care activities. The practice expenses per hour for the specialty were an average of the practice expenses per hour for the respondent physicians in that specialty. In addition, for the CY 2000 physician fee schedule, we used data from a survey submitted by the Society of Thoracic Surgeons (STS) in calculating thoracic and cardiac surgery's practice expense per hour. (See the November 1999 final rule (64 FR 59391) for additional information concerning acceptance of this data.)
• Step (2) We determined the total number of physician hours (by specialty) spent treating Medicare patients. This was calculated from physician time data for each procedure code and from Medicare claims data.
• Step (3) We calculated the practice expense pools by specialty and by cost category by multiplying the specialty practice expenses per hour for each category by the total physician hours.
For services with work RVUs equal to zero (including the technical component (TC) of services with a TC and professional component (PC)), we created a separate practice expense pool, using the average clinical staff time from the CPEP data (since these codes by definition do not have physician time), and the “all physicians” practice expense per hour.
For direct costs (including clinical labor, medical supplies, and medical equipment), we used the CPEP data as the allocation basis. The CPEP data for clinical labor, medical supplies, and medical equipment were used to allocate the clinical labor, medical supplies, and medical equipment cost pools, respectively.
For the separate practice expense pool for services with work RVUs equal to zero, we used 1998 practice expense RVUs to allocate the direct cost pools (clinical labor, medical supplies, and medical equipment cost pools) as an interim measure. Also, for all radiology services that are assigned work RVUs, we used the 1998 practice expense relative values for radiology services as an interim measure to allocate the direct practice expense cost pool for radiology. For all other specialties that perform radiology services, we used the CPEP data for radiology services in the allocation of that specialty's direct practice expense cost pools.
To allocate the cost pools for indirect costs, including administrative labor, office expenses, and all other expenses, we used the total direct costs, as described above, in combination with the physician fee schedule work RVUs. We converted the work RVUs to dollars using the Medicare CF (expressed in 1995 dollars for consistency with the SMS survey years).
The SMS pool was divided by the CPEP pool for each specialty to produce a scaling factor that was applied to the CPEP direct cost inputs. This was intended to match costs counted as practice expenses in the SMS survey with items counted as practice expenses in the CPEP process. When the specialty-specific scaling factor exceeds the average scaling factor by more than three standard deviations, we used the average scaling factor. (See the November 1999 final rule (64 FR 59390) for further discussion of this issue).
For procedures performed by more than one specialty, the final procedure code allocation was a weighted average of allocations for the specialties that perform the procedure, with the weights being the frequency with which each specialty performs the procedure on Medicare patients.
For services with the PC and TC paid under the physician fee schedule, the global practice expense RVUs were set equal to the sum of the PC and TC.
Since many specialties identified in our claims data did not correspond exactly to the specialties included in the practice expense tables from the SMS survey data, it was necessary to crosswalk these specialties to the most appropriate SMS specialty category. We also made the following adjustments to the practice expense per hour data. (For the rationale for these adjustments to the practice expense per hour see the November 1998 final rule (63 FR 58841).)
• We set the medical materials and supplies practice expenses per hour for the specialty of “oncology” equal to the “all physician” medical materials and supplies practice expenses per hour.
• We based the administrative payroll, office, and other practice expenses per hour for the specialties of “physical therapy” and “occupational therapy” on data used to develop the salary equivalency guidelines for these specialties. We set the remaining practice expense per hour categories equal to the “all physician” practice expenses per hour from the SMS survey data.
• Due to uncertainty concerning the appropriate crosswalk and time data for the nonphysician specialty “audiologist,” we derived the resource-based practice expense RVUs for codes performed by audiologists from the practice expenses per hour of the other specialties that perform these codes.
• For the specialty of “emergency medicine,” we used the “all physician” practice expense per hour to create practice expense cost pools for the categories “clerical payroll” and “other expenses.”
• For the specialty of “podiatry,” we used the “all physician” practice expense per hour to create the practice expense pool.
• For the specialty of “pathology,” we removed the supervision and autopsy hours reimbursed through Part A of the Medicare program from the practice expense per hour calculation.
• For the specialty “maxillofacial prosthetics,” we used the “all physician” practice expense per hour to create practice expense cost pools and, as an interim measure, allocated these pools using the 1998 practice expense RVUs.
• We split the practice expenses per hour for the specialty “radiology” into “radiation oncology” and “radiology other than radiation oncology” and used this split practice expense per hour to create practice expense cost pools for these specialties.
The time data resulting from the refinement of the work RVUs have been, on average, 25 percent greater than the time data obtained by the Harvard study for the same services. We increased the Harvard research team's time data to ensure consistency between these data sources.
For services with no assigned physician time (such as, dialysis, physical therapy, psychology, and many radiology and other diagnostic services), we calculated estimated total physician time based on work RVUs, maximum clinical staff time for each service as shown in the CPEP data, or the judgment of our clinical staff.
We calculated the time for CPT codes 00100 through 01996, using the base and time units from the anesthesia fee schedule and the Medicare allowed claims data.
Section 4505(d)(1)(C) of the BBA required us to develop a refinement process to be used during each of the 4 years of the transition period. We did not propose a specific long-term refinement process in the June 1998 proposed rule (63 FR 30835). Rather, we set out the parameters for an acceptable refinement process for practice expense RVUs and solicited comments on our proposal. We received a large variety of comments about broad methodology issues, practice expense per hour data, and detailed code level data. We made some adjustments to our proposal when we were convinced an adjustment was appropriate. We also indicated that we would consider other comments for possible refinement and that the values of all codes would be considered interim for 1999 and for future years during the transition period.
We outlined in the November 1998 final rule (63 FR 58832) the steps we were undertaking as part of the initial refinement process. These steps included—
• Establishment of a mechanism to receive independent advice for dealing with broad practice expense RVU technical and methodological issues;
• Evaluation of any additional recommendations from the General Accounting Office, the Medicare Payment Advisory Commission (MedPAC), and the Practicing Physicians Advisory Council (PPAC); and
• Consultation with physician groups and other groups concerning these issues.
We also discussed a proposal submitted by the AMA's Specialty Society Relative Value Update Committee (RUC) for development of a new advisory committee, the Practice Expense Advisory Committee (PEAC), to review comments and recommendations on the code-specific CPEP data during the refinement period. In addition, we solicited comments and suggestions about our practice expense methodology from organizations that have a broad range of interests and expertise in practice expense and survey issues.
In the July 22, 1999 proposed rule, the November 1999 final rule, and the July 2000 proposed rule, we provided further information on refinement activities underway, including the recommendations from the PEAC and the support contract that we awarded to focus on methodologic issues. The following is an update on activities with respect to these initiatives, as well as the status of refinement with respect to other areas of concern such as the SMS data and CPEP inputs.
We have received many comments on both our 1998 and 1999 proposed and final rules from a number of medical specialty societies expressing concerns regarding the accuracy of the SMS data. Some commenters stated their belief that the sample size for their specialty was not large enough to yield reliable data. Other specialties not represented in the SMS survey objected that the crosswalk used for their practice expense per hour was not appropriate and requested that their own data be used instead. Commenters also raised questions about whether the direct patient care hours for their specialty were overstated by the SMS to the specialty's disadvantage.
We consider dealing with these issues to be one of the major priorities of the refinement effort. Therefore, we have undertaken the following activities:
On May 3, 2000, we published an interim final rule (65 FR 25664) that set forth the criteria for physician and non-physician specialty groups to submit supplemental practice expense survey data for use in determining payments under the physician fee schedule. Section 212 of the BBRA amended section 1848(c) of the Act to require us to establish a process under which we will accept and use, to the maximum extent practicable and consistent with sound data practices, data collected or developed by entities and organizations. These data will supplement the data we
To obtain data that could be used in computing practice expense RVUs beginning January 1, 2001, we published the criteria in the May 2000 interim final rule (65 FR 25666) that we will apply to supplemental survey data submitted to us by August 1, 2000. We also provided a 60-day period for submission of comments on the criteria that we will consider for survey data submitted between August 2, 2000 and August 1, 2001 for use in computing the practice expense RVUs for the CY 2002 physician fee schedule. (See the May 2000 interim final rule for further information on the criteria and process). We are responding to comments received on the interim final rule in this rule, and are publishing the criteria to be used for 2001 submission.
The following are specific criteria and discussion in the May 2000 interim final rule.
• Physician groups must draw their sample from the AMA Physician Masterfile to ensure a nationally representative sample that includes both members and non-members of a physician specialty group.
• Physician groups must arrange for the AMA to send the sample directly to their survey contractor to ensure confidentiality of the sample; that is, to ensure comparability in the methods and data collected, specialties must not know the names of the specific individuals in the sample.
• Non-physician specialties not included in the AMA's SMS must develop a method to draw a nationally representative sample of members and non-members. At a minimum, these groups must include former members in their survey sample. The sample must be drawn by the non-physician group's survey contractor, or another independent party, in a way that ensures the confidentiality of the sample; that is, to ensure comparability in the methods and data collected, specialties must not know the names of the specific individuals in the sample.
• A group (or its contractors) must conduct the survey based on the SMS survey instruments and protocols, including administration and follow-up efforts, and definitions of practice expense and hours in patient care. In addition, any cover letters or other information furnished to survey sample participants must be comparable to such information previously supplied by the SMS contractor to its sample participants.
• A group must use a contractor that has experience with the SMS or a survey firm with experience successfully conducting national multi-specialty surveys of physicians using nationally representative random samples.
• A group must submit raw survey data to us, including all complete and incomplete survey responses as well as any cover letters and instructions that accompanied the survey, by August 1, 2000 for data analysis and editing to ensure consistency. All personal identifiers in the raw data must be eliminated. (Send data to Health Care Financing Administration, Department of Health and Human Services, Attn: Kenneth Marsalek, C4-03-06, 7500 Security Boulevard, Baltimore, MD 21244-8013.)
• Raw survey data submitted to us between August 2, 2000 and August 1, 2001 will be considered for use in computing practice expense RVUs for CY 2002.
• The physician practice expense data from surveys that we use in our code-level practice expense calculations are the practice expenses per physician hour in the six practice expense categories—clinical labor, medical supplies, medical equipment, administrative labor, office overhead, and other. Supplemental survey data must include data for these categories. Ideally, we would like to calculate practice expense values with precision; however, we recognize that we must achieve a balance. Conducting surveys is expensive, and there is a tension between achieving large sample sizes, which increases precision, and smaller ones, which conserves costs.
In addition, in the May 2000 interim final rule (65 FR 25666) we indicated that we believed an achievable level of precision is a coefficient of variation, that is, the ratio of the standard error of the mean to the mean expressed as a percent, not greater than 10 percent, for overall practice expenses or practice expenses per hour. For existing surveys the standard deviation is frequently the same magnitude as the mean. If the standard deviation equals the mean, then a usable sample size of 100 will yield a coefficient of variation of 10 percent. For small, homogeneous subspecialties, the variations in practice expenses may be lower because a smaller sample size achieves this level of precision. Other ways of expressing precision (for example, 95 percent confidence intervals) are also acceptable if they are approximately equivalent to a coefficient of variation of 10 percent or better. We indicated that will consider surveys for which the precision of the practice expenses are equal to or better than this level of precision and that meet the other survey criteria. Also, we indicated that we will require documentation regarding how the practice expenses were calculated and we will verify the calculations. We have the statutory authority, however, to determine the final practice expense RVUs.
We also indicated that, since the physician fee schedule is a national fee schedule, we would require that the survey be representative of the target population of physicians nationwide. We can presume national representativeness if a random sample is drawn from a complete nationwide listing of the physician specialty or subspecialty and the response rate, the percent of usable responses received from the sample, is high, for example, 80 to 90 percent. If any of these conditions (random sample, complete nationwide listing, and high response rate) are not achieved, then the potential impacts of the deviations upon national representativeness must be explored and documented. For example, if the response rate is low, then justification must be furnished to demonstrate that the responders are not significantly different from non-responders with regard to factors affecting practice expense. Differential weighting of subsamples may improve the representativeness. Minor deviations from national representativeness may be acceptable.
We received comments from 17 specialty groups concerning the criteria for the acceptance of supplemental data. While many of these comments contained positive feedback on aspects of our interim final rule, they all contained statements of opposition to specific requirements and/or suggestions for improving the process. Outlined below are the comments from specialty groups and our responses concerning the requirements for supplemental survey data.
One group expressed concern that by sampling from the AMA Physician Masterfile, a substantial number of emergency medicine practices are overlooked. The small number of physician practice owners leads to a strong possibility that these owners will not be selected in the random sample. They suggest that we permit an additional sample of large emergency medicine practice groups to supplement the current survey.
The criteria published May 3, 2000 will be used for surveys submitted in 2001 with the following modifications.
• We had proposed that specialty groups use a contractor that has experience with the SMS or a survey firm with experience successfully conducting national multi-specialty surveys of physicians using nationally representative random samples. We have modified the criteria to provide for using a contractor that has experience surveying health care professionals, collecting financial information and using random samples.
• In addition, based on our review of the supplemental surveys submitted, we are modifying our criteria concerning an acceptable level of precision for surveys. We now believe a reasonable level of precision for surveys to be used for supplementing current data is a 90 percent confidence interval with a range of plus or minus 10 percent of the mean; (that is, 1.645 times the standard error of the mean, divided by the mean, should be equal to or less than 10 percent of the mean).
With respect to response rates, we are concerned about the low response rates received from supplemental surveys submitted to us in 2000. While we acknowledge that the timing of the surveys (that is, short-field time and time of year) contributed to the low response rates, we believe that groups will have more time to conduct surveys and, thus, are likely to obtain better response rates in future surveys. While we continue to believe that it is impossible and impractical to set rigid cutoffs, we are expecting higher response rates than were achieved in the supplemental surveys submitted to us in 2000. We would like to see detailed analyses that indicate the sample is representative of the population. While The Lewin Group was able to perform some limited analyses of response bias for the supplemental surveys received in 2000, we expect that these supplemental surveys received in 2001 will provide detailed analyses with respect to possible response bias on factors that could affect practice expenses. Such analyses should consider variables such as specialty society membership, years in practice, board certification, gender, geographic distribution of respondents, and practice arrangements (for example, solo practitioners or large group practices). We will not consider supplemental data in the practice expense methodology unless we receive detailed analyses that give us confidence that survey respondents are representative of the profession on items that affect practice expense. In addition, the data must appear reasonable and consistent with other data used to determine practice expense RVUs.
In response to the May 3, 2000 interim final rule, three organizations submitted supplemental survey data for consideration. One survey was submitted by the American Physical Therapy Association (APTA), and a joint survey was submitted by the American Association of Vascular Surgery (AAVS) and the Society for Vascular Surgery (SVS). Our contractor, The Lewin Group, has evaluated the data submitted by each organization and recommended that we use these data. The full recommendation and discussion will be made available on the HCFA website. We have decided to use the data submitted by the AAVS and SVS to supplement the information we are currently using. However, we have decided not to use the data submitted by the APTA. The revised practice expense per hour figures that we are using for vascular surgery are:
These figures are from the supplemental survey information provided to us from the Lewin Group adjusted by the MEI so the figures reflect 1995 data. That is, we divided the 1999 practice expense per hour data by the cumulative MEI for 1996-1999 (1.0877).
Both supplemental surveys have extremely low response rates (about 14 percent for vascular surgeons and 11 percent for physical therapists). We specified the criteria we would apply for supplemental surveys in the May 2000 interim final rule (65 FR 25666). While we did not establish a precise minimum response rate, we did indicate that surveys with response rates less than 80 percent to 90 percent require an analysis to determine to what extent the sample is representative of the population. The extremely low response rates achieved by these two supplemental surveys and the relatively small number of responses make it extremely difficult, and very subjective, to determine whether the data are representative of each specialty. Our contractor was able to make very limited assessments of this issue based on the data provided.
However, in our May 2000 interim final rule, we indicated that, based on our review of existing physician practice expense surveys, we believe that an achievable level of precision is a coefficient of variation, that is, the ratio of the standard error of the mean to the mean expressed as a percent, not greater than 10 percent, for overall practice expenses or practice expenses per hour. For existing surveys, the standard deviation is frequently the same magnitude as the mean. We indicated in the May 2000 interim final rule that we would consider practice expenses for which the precision of the practice expenses is equal to or better than this level of precision and that meet the other survey criteria.
The data submitted by the AAVS and the SVS met the level of precision. The data submitted by the APTA did not rise to this level of precision; they did not meet this objective criterion set out in the May 2000 interim final rule. Thus, we do not have, in the survey data submitted by the APTA, data that convince us of both the representativeness or the precision of the surveys. For that reason, we are unable to incorporate the supplemental survey data submitted by the APTA in the practice expense system.
We note, however, that we have made an adjustment to the practice expense data for physical and occupational therapy services based on other comments received. These comments and adjustments are described elsewhere in this regulation.
In addition, one specialty society also submitted data concerning clinical staff in the hospital setting. The data submitted were not in the context of supplemental survey data. We discuss the issues addressed by these data elsewhere in this preamble.
In the July 2000 proposed rule (65 FR 44180), we discussed the tasks that our contractor, The Lewin Group, was undertaking to assist us with broad practice expense technical and methodological issues. We also highlighted the recommendations that were contained in the first draft report that the contractor submitted, “Practice Expense Methodology,” dated September 24, 1999. This report is on our homepage under the title “Practice Expense Methodology Report.” (Access to our homepage is discussed under the “Supplementary Information” section above.)
The report contained various recommendations aimed at increasing the validity and reliability of the AMA's SMS survey. Although the Lewin Group's recommendations were made specifically to address improving the SMS survey for calculating practice expense RVUs, we believe the recommendations will be useful in making refinements to any other survey instrument that may be used in calculating practice expense RVUs. The recommendations fell into the three following areas:
• The use of data supplementary to the SMS survey.
• Suggested changes to the survey instrument.
• Recommendations for using the data in calculating the specialty-specific practice expense per hour.
In response to the report's recommendations on the use of the SMS data, we proposed to incorporate data from the 1998 SMS survey, which is the latest data available, into our practice expense per-hour calculations. In addition, we proposed basing the practice expense per hour calculations on a 4-year average, rather than the 3-year average recommended in the contractor's report. We published a table that contained the practice expense per-hour calculations for CY 2001 that resulted from the above proposals. We also proposed standardizing the practice expense data to reflect a 1995 cost year consistent with the pricing information we are using for the estimates of practice expense inputs for individual procedures. To standardize costs, we proposed inflating 1995 cost data by the MEI and deflating 1996 and 1997 costs data. This proposal has virtually no impact on the practice expense per-hour calculations.
After discussions with the AMA's SMS staff, we did not propose, as recommended by our contractor, to revise edits and trims to the SMS survey data to exclude data that fall outside set acceptable ranges.
In the July 2000 proposed rule (65 FR 44184), we also discussed the suggestions we made to the AMA for including additional questions in the SMS survey that would make it more useful for calculating specialty-specific practice expenses more precisely. It now appears that the AMA may no longer undertake a multi-specialty survey to collect practice expense information. While we will continue our discussion with the AMA regarding any future plans for practice expense data collection, as stated above, we believe these recommendations will be useful in the design of any other survey used in developing practice expense RVUs.
As we indicated earlier, we proposed to use data from the 1998 SMS to develop the 2001 practice expense RVUs. Furthermore, data from the 1999 SMS will become available later this year for use in developing the 2002 practice expense RVUs. In addition, section 1848(c)(2)(B) of the Act requires that not less often than every 5 years, we review and make adjustments to RVUs. Thus, we are required by the statute to review and make adjustments to the practice expense RVUs 5 years after the end of the transition period, that is, no later than 2007. Regardless of whether the AMA continues to collect data on practice expenses, we will be developing plans for making refinements to practice expense RVUs beyond 2002.
One specialty commented that inclusion of the 1998 SMS data is premature because of questions regarding its validity, since AMA is redeveloping the SMS with the possibility of seeking specialty-society input, and there are questions regarding the validity of the 1998 SMS data. While some commenters agreed with the general principle of using the most current data, they argued that the quality of the 1998 SMS data does not merit inclusion into our practice expense per-hour calculations. One commenter stated that the SMS survey does not recognize the unique nature of emergency medicine.
Alternatively, there were many comments that supported our use of the 1998 SMS data. These commenters generally indicated that we should use the most current data because practice expenses may change over time. In addition, these commenters indicated that there is no evidence that the 1998 SMS data is tainted or otherwise objectionable. Other commenters indicated that including more survey responses from later SMS years will result in practice expense values that are more representative of physicians' costs. Some commenters indicated that practice expense data based on a 4-year sample provides greater assurance of its quality. Many of the commenters that suggested incorporating the 1998 SMS data also indicated that we should use the 1999 data from the SMS when it becomes available. Other commenters supported our proposal to base the practice expense per-hour calculation on a 4-year average of SMS data as opposed to a 3-year average, because it will help to compensate for the low number of survey responses from some specialties in the prior years' SMS surveys.
One commenter believed that we should follow our contractor's recommendation and use a rolling 3-year average, because using 4 years results in older data completed by persons less familiar with the SMS.
In general, use of the 1998 SMS improves the stability of the practice expense per hour and results in little specialty level impact. For the 35 specialties listed in our impact table in the July 2000 proposed rule (65 FR 44203), 21 specialties will experience an impact that is near zero. There are nine specialties that will experience an impact of approximately 1 percent as a result of inclusion of the data. For two (cardiac and thoracic surgery) of the four specialties that show a payment impact of approximately 2 percent, the data were affected by more than just the inclusion of the 1998 SMS data. In the November 1999 final rule (64 FR 59391), we indicated that supplemental data would be incorporated in the practice expense per hour and we would not include data from the 1995 SMS. We are now adding the 1995 SMS data as well as the 1998 SMS data to the calculation of practice expense per hour and increased the likelihood that there would be a larger impact on the practice expense per hour. For one specialty (physical and occupational therapy, included in the nonphysician practitioner category), we made an error in the practice expense per hour calculation in the July 2000 proposed rule. After correcting this error, there is only approximately a 1-percent increase in the nonphysician practitioner category from incorporating the additional SMS data. We believe that these results support the argument that the practice expense per hour is generally stable and that it is appropriate to include 1998 SMS data in the practice expense methodology.
With respect to the comment that it is premature to incorporate 1998 SMS data into the practice expense methodology because of AMA efforts to redesign the survey and include specialty society input, we are unsure of the AMA's efforts in this regard. Nevertheless, while we would welcome multispecialty involvement in an effort to collect practice expense data specifically for the purpose of determining relative value units, we believe that such efforts should not have any bearing on our decision to incorporate later SMS data into the practice expense methodology at this time. If new data were to be collected under a redesigned survey process, it could be at least 2 years before such data is available to us. In the interim, we believe it is appropriate to include the latest SMS data into our methodology.
We disagree with the commenter who suggested that the older SMS data should be eliminated from the practice expense per hour calculations because the surveys were completed by respondents less familiar with the SMS. The SMS is a longstanding survey that was originally developed by the AMA in 1981. There is no evidence that data from earlier SMS surveys is less reliable than later survey information.
With respect to the concerns expressed about gathering practice expense data beyond 1999, we have published criteria that specialties must follow to submit supplementary practice expense survey data that can be included in the practice expense calculations. Thus, there is a process for specialties to collect representative data on practice expenses for a specialty that can be used to influence the calculation of practice expense RVUs. Furthermore, we are currently planning to use 1999 SMS data to determine the practice expense per hour for calculating practice expense RVUs for 2002. Thus, the fully implemented resource-based practice expense RVUs will be based on a weighted 5-year average of the latest SMS survey data.
Regardless of whether the AMA were to continue the SMS survey, it is unclear whether it would be necessary or even desirable to incorporate more recent practice expense per hour data into the methodology on an annual basis. While the practice expense may increase or decrease over time, the important variable for the practice expense methodology is whether there is a relative change among specialties in practice expense per hour. Again, with exceptions for some specialties, there generally appears to be stability in the relative practice expense per hour among specialties in the SMS data we are using. Indeed, there generally was little redistribution in payment resulting from use of the latest SMS data. For 21 of the 35 specialties listed in Table 1 of the July 2000 proposed rule (65 FR 44203), the percent change in practice expense from using the latest SMS data was near zero. For nine of the remaining 14 specialties, the impact on payments was only 1 percent. For only five of 35 specialties listed was the impact on payments 2 percent or greater. Thus, if there is year to year stability in the relative practice expense per hour among specialties, it will likely make little difference whether we incorporate additional practice expense data into the methodology.
However, it is possible that there will be more significant changes in relative practice expense per hour over time among specialties. The statute requires that we make refinements in the practice expense RVUs at least every 5 years. While we expect to continue making refinements to the inputs for individual codes on an annual basis, it could be several years before we might require practice expense data from a multi-specialty survey after the initial refinement period ends in 2002. While we consider how to approach this issue, we welcome the comments that suggested that we seek input from the medical community in developing a mutually satisfactory and equitable approach to obtaining the needed information on practice expenses for future refinement efforts.
In our July 2000 proposed rule (65 FR 44184), we discussed the many concerns that have been raised from various specialty societies concerning our calculation of direct patient care hours. Several previous commenters
We then discussed the steps we were taking to improve the future accuracy of these data. We recommended more precise wording for future survey questions so that only the appropriate practitioner hours are included.
We also discussed the second draft report issued by our contractor, entitled “Validating Patient Care Hours Used in HCFA's Practice Expense Methodology.” This report, which is on our homepage under the title “Validating Patient Care Hours,” explores alternative methods that we might use to validate the time data collected by the SMS survey. We have extended The Lewin Group's contract so that, among other refinement tasks, the above validations can be performed. We also solicited comments and suggestions as to other steps we could take to verify and improve the accuracy of the specialty-specific patient care hours.
The comments also contained a number of recommendations. One commenter suggested that we could use a blend of the all-physician and the specialty-specific hours. A specialty society, citing concerns about the variability between the SMS and the Harvard/RUC time data, recommended that we collect information on the Medicare share of practice hours in the SMS to produce a check of the meaningfulness of the pool allocations. Another specialty society, claiming that the SMS data on patient care hours are sure to be imprecise, urged us to use a standardized number of hours in the practice expense calculation or to statistically limit the impact of this variable. While one commenter recommended that we use the average number of hours per week that physicians' offices are open to calculate the practice expense per hour, another commenter argued that the assumption of a 40-hour work week for all specialties would result in a significant distortion of practice expenses per hour.
The PEAC, a subcommittee of the RUC, held its initial meetings last year to begin to refine the clinical staff, supply and equipment inputs for physician fee schedule services. In the November 1999 final rule (64 FR 59394), we responded to the RUC recommendations for the refinement of the direct inputs for 65 codes originally reviewed by the PEAC and subsequently approved by the RUC and noted that our actions on all of the recommended inputs were subject to comment. We received the following comments on our revisions to the RUC recommendations:
There appears not be a consensus among the ophthalmic specialty societies regarding which staff type to use for ophthalmology codes. In addition, we have not used any of the decisions from the 1997 validation panels in refining the practice expense inputs, but have accepted the RUC recommendations for the use of the OMP staff types for the codes that have been refined to date. We have not received from the RUC any recommendation regarding a global change in the staff type for ophthalmology services, but would certainly consider any future recommendation from the RUC on this issue.
In the November 1999 rule (64 FR 59397), we stated that these were professional services and, if any practice expenses were incurred, they could be reported using other applicable codes. Therefore, we removed all practice expense inputs for these two codes.
In the November 1999 final rule, we deferred action on the RUC recommendations for a few groups of CPT codes on which we had significant questions. In the July 2000 proposed rule (65 FR 44185), we proposed to accept two groups of CPT codes of the RUC recommendations with the revisions noted below, while the RUC recommendation discussed below for the antigen service has not been previously addressed.
We discussed the inputs for these codes at length with the relevant specialty society, and arrived at a consensus on the staff, supplies, and equipment that were needed for these services.
The RUC had recommended 102 minutes of clinical staff time for CPT code 96408 and 121 minutes for CPT code 96410. After the publication of the November 1999 final rule we met with representatives of the American Society of Clinical Oncology (ASCO) and discussed the society's breakdown by specific tasks of the above staff times. Included in this breakdown were 20 minutes for pre- and post-procedure education and 15 minutes for three phone calls after each visit.
Because we believed that the times for patient education and phone calls should be averaged over the whole course of chemotherapy treatment, and because there appeared to be some duplication in the pre- and post-procedure education tasks, we reduced both the patient education and phone
The RUC did not forward any recommendations on the specific inputs required to perform the above service. However, we did receive a recommendation about the interpretation of the meaning of a dose for purposes of calculating the practice expense RVUs for this service. Because we did not believe the recommendation resolved the ambiguity and confusion in the medical community surrounding this issue, we did not accept this recommendation in the July proposed rule. Since that time, we have received clarifying comments from relevant specialties on both the definition of dose and the practice expense inputs to use for this code.
The practice expense inputs have been analyzed and adjusted so that they now correspond to the practice expense of preparing a one cc dose from a ten cc (ten dose) vial. The practice expense inputs for CPT code 95165 are based on an assumption that ten doses are typically included in each vial. Payment will be based on a maximum of ten doses per multidose vial. The practice expense RVUs for preparing a ten dose vial will remain the same, even if twenty doses are obtained from the vial (for example, if the physician administers 0.5cc doses, instead of one cc doses). Therefore, Medicare should be billed for a maximum of ten doses per vial, even if more than ten doses are obtained from the vial. Furthermore, when a physician dilutes a multidose vial (for example, by taking a one cc aliquot from a multidose vial and mixing it with nine cc's of diluent in a new multidose vial), Medicare should not be billed an additional amount for these diluted doses for CPT 95165. The additional clinical staff and supply costs for preparing such a diluted vial are minimal, because allergens represent over 80% of the direct costs of preparing a multidose vial. In a diluted vial there are no associated allergen costs, since they have already been billed in preparation of the initial vial. Therefore, we expect a maximum of ten doses to be billed for each multidose vial. If fewer doses are prepared from this vial, a dose number less than ten per vial should be billed.
The practice expense inputs per one cc dose are as follows:
If multiplied by ten, the inputs correspond to the total practice expense of a ten cc vial from which ten doses of one cc each are administered. Commenters recommended that a typical ten cc multidose vial contains five antigens and no diluent and that the total number of needles and syringes for the ten cc vial is five. The cost data for allergens was obtained from catalogue information and is based on the typical practice of using standardized extracts when available.
In view of the clarification we have made regarding practice expense inputs, we will revise Section 15050(B)(7) of the Medicare Carriers Manual. In May 1998, we changed the language of that section, in part, to clarify our payment policy for antigen preparation. At that time we stated, “A dose of code 95165 is the total amount of antigen to be administered to a patient during one treatment session, whether mixed or in separate visits.” Two examples of antigen preparation and administration follow immediately after this language.
We will revise this section of the carrier manual to define a dose as a one cc aliqout from a single multidose vial. With this clarification physicians will be able to bill Medicare for each dose prepared in each multidose vial. We plan to issue new instructions to the carriers and update the carrier manual to ensure that appropriate payment is made as of January 1, 2001.
We believe that the recommendations received this year from the PEAC/RUC for the refinement of the CPEP inputs for existing codes mark a positive step in the CPEP refinement process. We received recommendations for clinical staff, supply and equipment inputs for 49 CPT codes, and for the supply and equipment inputs for four additional services. But the significance of the recommendations goes beyond the number of codes that were refined. First, included in these recommendations were the refinements for the 15 major evaluation and management (E/M) codes. These 15 codes represent over 25% of the payments made under the physician fee schedule. This was a breakthrough not only because the clinical staff times for these codes had previously been a point of major contention, but also because agreement on the inputs for E/M services may make it easier in the future to refine the post-surgical visits for thousands of services. Second, the PEAC/RUC approved supply packages for three specialties: obstetrics-gynecology, ophthalmology and neurosurgery; as a result, the supply inputs for hundreds of codes are now refined. We also understand that the PEAC will be developing further supply packages and is also setting up workgroups to determine approaches to standardizing pre- and post-procedure clinical staff times.
We have reviewed the submitted RUC recommendations and have accepted all of them with only two minor revisions. In order to be consistent with a revision made previously in the November 1999 final rule, we have deleted the skin marking pen when it appears in a recommended supply list because it is not practical to allocate its use to individual procedures. In addition, for the ophthalmology codes that were refined before the supply packages were adopted, we have substituted the ophthalmology visit supply package as appropriate. If future decisions are made on standard clinical staff times, all of these refined codes can be revisited to determine whether any further refinements would be appropriate.
Following is a list of the CPT codes that were included in the PEAC/RUC recommendations: (The complete PEAC/RUC recommendations and the revised CPEP database can be found on our website. See the Supplementary Information section of this rule for directions on accessing our web site.)
These are noncovered under the Medicare physician fee schedule.
In the November 1999 final rule (64 FR 59399), we removed estimates of all clinical staff time allotted to the use of clinical staff in the facility setting from the CPEP data. Commenters have since noted that the clinical staff times reported by some CPEP panels for pre-and post-service times for 0-day global services performed in the office were recorded in the intra-service field in the CPEP database. These times were, therefore, deleted along with the times for the use of clinical staff in the facility setting.
In the July 2000 proposed rule (65 FR 44186), we stated that these data are not comparable to the data we excluded for clinical staff used in the facility setting. We reviewed the “CPEP Recorders' Notes Files” compiled for each CPEP panel by Abt Associates, Inc., the contractor managing the CPEP panels. When the notes indicated that clinical staff estimates were for activities performed in physicians' offices, we proposed to reinstate the time data for 0-day global services.
In the November 1999 final rule (64 FR 59399) we finalized our decision to remove from the CPEP data all clinical staff times associated with physician's staff used in the facility setting. We implemented this policy for the following reasons—(1) We should not pay twice for the same service; (2) It is not typical practice for most specialty societies to use their own staff in the facility setting; and (3) Inclusion of these costs is arguably inconsistent with both the statute and Medicare regulations. In response to the November 1999 final rule, we received many comments on this final decision, which, for the most part, reiterated comments that had been made on the original proposal.
Several organizations contended that hospitals no longer supply the staff to furnish adequate care. In relation to this point, two commenters recommended that the issue of cost shifts between hospitals and other providers is one that we should not ignore, and, if there is any double payment, Part A payment to the affected hospitals should be adjusted.
Another specialty society recommended that we establish a modifier to allow for documentation of and payment for non-physician clinical staff who furnish services in a facility setting. This modifier would indicate whether there is a physician practice expense or a hospital practice expense that has been transferred to the physician practice, to ascertain whether payment should come from Medicare Part A or Part B.
One organization recommended that the SMS data be adjusted by the income received for the work of physician assistants.
As to the recommendations made by the commenters, we agree that it would be desirable to remove costs associated with these mid-level practitioners from the SMS data as well. This would answer the concern raised by another commenter that removing the clinical staff from the CPEP data introduces further inconsistency with the SMS data. It is for that reason that we had recommended to the AMA that several specific questions be added to the SMS survey to capture the needed information on this clinical staff issue, and we anticipate that we will, in the future, be able to obtain such data.
Although we would be interested in receiving data on the cost shifts between hospitals and other providers, we believe that the suggested use of a modifier for this purpose would be extremely difficult to implement and also burdensome for the practitioner. First, however, we must clarify that, even if the practice of bringing physician staff to the hospital pre-dates the advent of the hospital prospective payment system, any costs associated with such a practice were explicitly included in the hospital Diagnosis Related Group (DRG) payments in the September 1, 1983 interim final rule with comment and in the January 4, 1984 final rule. These rules reference section 1862(a)(14) of the Act, and the discussion makes clear that, with certain limited exceptions, all nonphysician services furnished to hospital inpatients are to be paid under Part A. The exception provided that, for any cost reporting period beginning before October 1, 1986, a hospital that has followed a practice, since before October 1, 1982, of allowing direct billing under Part B to an extent that immediate compliance with the bundling requirements would threaten the stability of patient care, could continue to bill under Part B. There is no indication that the waiver was extended. In response to a comment, we stated the following: “In order for a payment system that is based on a national average rate for a particular
We do agree that it would be helpful to determine whether hospitals are still providing the staffing that is assumed in their DRG payments. To this end, we have requested that the Office of Inspector General conduct an independent assessment of staffing arrangements between hospitals and thoracic surgeons.
In the November 1999 final rule, we deleted certain casting supplies from the CPEP data for the casting and strapping CPT codes 29000 through 29750. In the July 2000 proposed rule, we identified additional CPT codes for the treatment of fractures/dislocations and additional casting and splinting supplies that are separately billable under section 1861(s)(5) of the Act. Therefore, we proposed the removal of inputs for fiberglass roll, cast padding, cast shoe, stockingnet/stockinette, plaster bandage, Denver splint, dome paste bandage, cast sole, elastoplast roll, fiberglass splint, Ace wrap, Kerlix, Webril, malleable archbars, and elastics from the following CPT codes: 23500 through 23680; 24500 through 24685; 25500 through 25695; 26600 through 26785; 27500 through 27566; 27750 through 27848; 28400 through 28675, and 29000 through 29750.
We currently use the original CPEP definitions for equipment that distinguish between “procedure specific” equipment and “overhead” equipment. Under the “top-down” methodology, the CPEP inputs are used only as allocators of the specialty-specific practice expense pools, and we believe the distinction between types of equipment has served to hinder the process of refining the CPEP inputs while not leading to a substantive distinction in how we value services. Therefore, we proposed to combine both categories of equipment into a single “equipment” category, assuming an average 50 percent utilization for all equipment.
We also proposed to delete from the CPEP data equipment that is not used typically with any service, but is on “standby” for many services, or that is used for multiple services at the same time. The following is the list of equipment that we proposed to delete from the CPEP inputs of all services: autoclave, wheelchair, refrigerator, film file cabinet, hazard material spill kit, embryo freezer, water system, flammable reagent cabinet, utility freezer, ultra low temperature freezer, acid cabinet, bulk storage refrigerator, abortion clinic security system, abortion clinic security guard, gomco suction machine, doppler, laser printer, lead shielding, defibrillator with cardiac monitor, blood pressure/pulse oximetry monitor, blood pressure monitor, printer, crash cart—no defibrillator, and smoke evacuator.
The following is a list of equipment that we proposed to delete as “standby” equipment for most codes, but that we believed typically may be used with a designated subset of procedures:
X-ray view box—four panels (retain when currently in the CPEP data for codes in the range CPT codes 70010 through 79999).
ECG machine—3 channel (retain when currently in the CPEP data for CPT codes 93000 through 93221).
Pulse oximeter (retain when currently in the CPEP data for CPT codes 94620, 94621, 94680, 94681 and 94690; 94760 through 94770, 95807 through 95811 and 95819).
ECG/blood pressure monitor—3 channel (retain when currently in the CPEP data for CPT codes 43200 through 43202 and 43234 through 43239).
Cardiac monitor (retain when currently in the CPEP data for CPT codes 31615 through 31628).
ECG-Burdick (except for HCPCS code G0166).
The doppler should be retained for the prenatal codes CPT 59400, 59425, 59426, 59510, 59610 and 59618.
The blood pressure and pulse oximetry monitors should be retained for procedures requiring anesthesia or sedation, CPT 58555, 58558, 58120, 58800, 59140, 59160, 59812, 59820, 59840 and 59841.
The suction machine should be maintained for procedures that include evacuation of the uterus, CPT 58120, 59140, 59160, 59812, 59820, 59821, 59840, 59841.
(v) CPEP Anomalies
In the November 1999 final rule, we made corrections to the CPEP data for a number of codes when we learned that the data contained errors and anomalies that we could easily correct. In the July 2000 proposed rule, we listed other egregious errors and anomalies that we are proposing to correct. As we have previously stated, though certain revisions may be made now, all practice expense inputs for these codes are still subject to further comment, refinement, and potential PEAC and RUC review and recommendations. We received the following comments on our proposed corrections.
The Act requires payment of some practitioner services (services of certified registered nurse anesthetists, nurse practitioners, clinical nurse specialists, physician assistants, and certified nurse mid-wives) based on a percentage of the physician fee schedule payment amount. Since the payment under the physician fee schedule for a service performed by a mid-level
We have received, in response to previous rules, comments from several surgical specialties urging us to evaluate the Medicare claims data to eliminate potential errors in the specialties associated with each service. In the June 2000 proposed rule, we described the analyses we ran to determine whether potential errors in the claims data have an adverse impact on any specialty or merely represent “noise” that creates no significant effect. We tested, for neurosurgery, ophthalmology and otolaryngology, the impact of reassigning to the dominant specialty the small proportion of allowed services associated with specialties not expected to perform these services. The impacts did not even approach a 1-percent increase or decrease in any scenario.
We stated our belief that these simulations demonstrated that the small percentage of potential errors in our very large database have no adverse effect on specialty-specific practice expense RVUs. Therefore, we did not propose any further action at this time.
In the July 2000 proposed rule, we discussed the work The Lewin Group had recently begun on the third phase of the project, which concentrates specifically on evaluating the indirect cost allocation methodology and considers alternatives to allocating indirect costs by the current method. We expect their report on this analysis, which will be placed on our website, to be available soon.
As we indicated both in that rule and in the June 5, 1998 proposed rule (63 FR 30832), there are two potential sources of bias in the practice expense per hour data that may result in an overstatement of the aggregate practice expense pool. First, mid-level practitioners may have been included in the numerator of the practice expense per hour calculation even though there is generally separate payment for their services. Thus, a mid-level practitioner would be analogous to an employee physician who also generates revenue and whose costs are not included in the practice expense calculation, rather than to a registered nurse or other practitioner who cannot furnish a separately billable service. Second, the mid-level practitioner's hours spent are not included in the denominator of the practice expense per hour calculation even though, like a physician, the mid-level practitioner is generating patient care revenues during the hours spent in patient care. To the extent that a specialty depends on the use of mid-level practitioners, then the aggregate specialty practice expense pools are likely to be overstated. Based on information in our utilization data and comments made to us by one of the
There were no proposals in the July 2000 proposed rule on this issue. However, in the November 1999 final rule, we implemented the proposal to remove requested services from the zero work pool and return them to the specialty-specific cost pools.
In the July 2000 proposed rule, we clarified the definition of facility and nonfacility sites of service for the purposes of practice expense calculations. This distinction takes into account the higher expenses of the practitioner in the nonfacility setting. The major purpose of this distinction is to ensure that Medicare does not duplicate payment, to the physician and to the facility, for any of the practice expenses incurred in performing a service for a Medicare patient. For purposes of the site-of-service, we have defined hospitals, skilled nursing facilities (SNFs), and ambulatory surgical centers as facilities, because they will receive a facility payment for their provision of services. In the July 2000 proposed rule, we proposed to revise § 414.22(b)(5)(i) (Practice expense RVUs) to define community mental health centers (CMHCs) as facility settings since CMHCs also receive a separate facility payment for their services.
In addition, we clarified that the nonfacility practice expense RVUs should be applied to all outpatient therapy services (physical therapy, occupational therapy, and speech language pathology), even when they are provided in a facility. Only the facility can bill for therapy services furnished to hospital and SNF patients. Because there will be only one bill for this service and because the payment must reflect the practice expenses incurred in furnishing the service, the higher nonfacility RVUs are used to pay for therapy services even in the facility setting.
• The policy offers a financial incentive for physicians to perform certain gastroenterological procedures in their offices, rather than in an ASC or hospital outpatient department;
• The policy allows the procedures to be furnished in a physician's office that does not have to meet accreditation standards;
• The wide divergence between the payments in the two settings may be encouraging the performance of gastrointestinal procedures by non-gastroenterologists; and,
• This reduction of payments for endoscopy services in the facility setting is contrary to the intent of the statute.
The commenters had varying recommendations on this issue: one comment urged us to provide the same practice expense RVUs in the facility and nonfacility settings for 18 endoscopic gastroenterological procedures. Another commenter suggested that because we now pay therapy services at the nonfacility rate regardless of setting, we should do the same for the colorectal screening codes. A major specialty society stated that it is in the process of working with gastroenterology societies to develop a proposal to create a single site-of-service payment rate for those services that are furnished less than 10 percent of the time in the office.
We have serious reservations about adopting a policy to develop a single site-of-service payment for services that are furnished less than 10 percent of the time in the office. First, if there are real concerns regarding patient safety when certain procedures are furnished in the office, sufficient evidence should be presented to the relevant parties so that an appropriate coverage decision can be made. We emphasize that such a decision would be a coverage decision, and would not be a payment policy issue. Second, a 10-percent threshold could eliminate payment in the office setting for some high-volume procedures done thousands of times there. Third, we have some concern that this issue may be a matter of contention between those specialties that generally perform procedures in physician-owned ASCs and other specialties that would utilize the office setting. We would suggest that this issue, either as a general proposal or on a code-specific level, be discussed in the PEAC/RUC, where a multi-specialty recommendation could then be submitted to us.
The site-of-service policy for therapy services mentioned by a commenter as a precedent is not applicable to other services in the physician fee schedule. As described above, the facility itself must bill for both the technical and professional portion of the therapy service; in these circumstances, the therapist does not bill Medicare at all. Therefore, the nonfacility RVUs are used to ensure that the facility is paid for the direct costs incurred in the service.
With respect to the indirect methodology, the commenter is essentially suggesting that we abandon the direct inputs and use the work RVUs as the basis for allocating all indirect costs. While this approach may be simpler, we disagree that such a methodology will improve overall equity in Medicare payment for physicians' services. It would, of course, likely increase payments to specialties with relatively high work values and low direct costs. Furthermore, we do not believe this approach would be consistent with the statutory requirement to recognize “all staff, equipment and supplies and expenses” in determining the practice expense RVUs.
We do agree with the commenter that it may be helpful to validate physician time data using independent information sources such as operative logs. In fact, as we described in the July 2000 proposed rule (65 FR 44202), we have several efforts underway to obtain information on times spent performing individual procedures, including using inpatient and outpatient records and operative reports on skin-to-skin surgical times for selected procedures.
The Act requires that payments vary among fee schedule areas to the extent that resource costs vary as measured by the GPCIs. Section 1848(e)(1)(C) of the Act requires us to review and, if necessary, adjust the GPCIs at least every 3 years. This section of the Act also requires us to phase in the adjustment over 2 years and implement only one-half of any adjustment in the first year if more than 1 year has elapsed since the last GPCI revision.
The GPCIs were first implemented in 1992. (A detailed discussion of the development of the GPCIs and references to obtaining studies on the development of the GPCIs can be found in the July 17, 2000 proposed rule (65 FR 44189).) The first review and revision was implemented in 1995, and the second review was implemented in 1998.
The 2001 through 2003 GPCIs represent the third GPCI update. The 2002 GPCIs (Addendum D) are the fully-revised GPCIs. The 2001 GPCIs (Addendum E) represent the one-half transition GPCIs. Addendum F shows the estimated effects on area payments of the fully-revised 2002 GPCIs. The payment effects in 2001 will be about one-half of these amounts.
The same data sources and methodology used for the 1998 through 2000 GPCIs were used for the 2001 through 2003 GPCIs. The only differences between the 1998 through 2000 GPCIs and the proposed GPCIs are in the cost shares and RVU weighting.
The work GPCIs are based on the decennial census. The 1992 through 1994 work GPCIs were based on 1980 census data because 1990 census data were not yet available. The work GPCIs were revised in 1995 with new data from the 1990 census. New census data will not be available again until after the 2000 census. We searched for other data that would enable us to update the work GPCIs between the decennial censuses, but no acceptable data sources were found.
We therefore made no significant changes to the 2001 through 2003 work GPCIs from the 1998 through 2000 work GPCIs, other than the generally negligible changes resulting from using 1998, rather than 1994, RVUs for this GPCI update, because we were unable to find acceptable data for use between the decennial censuses. We believe that making no changes is preferable to making inaccurate changes based on unacceptable data. We believe that this is a reasonable position given the generally small magnitude of the changes in payments resulting from the changes in the work GPCIs from the 1980 to the 1990 census data.
As with the work GPCIs, the employee wage indices are based on decennial census data. For the same reasons discussed above pertaining to the work GPCIs, we are not changing the employee wage indices during this GPCI update.
The office rental indices are again based on HUD residential rent data. No changes have been made in the methodology. The rental indices are based on 2000 rather than 1994 HUD data.
As with all previous GPCIs, this component will be given a national value of 1.000, indicating no measurable differences among areas in costs.
As with the previous GPCIs, malpractice premium data were collected for a mature “claims made” policy with $1 million to $3 million limits of coverage, with adjustments made for mandatory patient compensation funds. The only difference is that we proposed to use more recent data. The proposed malpractice indices are based on 1996 through 1998 data, compared to the 1992 through 1994 data used in the previous GPCI update.
We received the following comments and responses on our proposed GPCI changes.
The 2002 fully-effective revised GPCIs and the transitional 2001 revised GPCIs can be found at Addendum D and Addendum E, respectively. No changes were made in the 2002 and 2001 GPCIs from those proposed in the July 17, 2000 proposed rule, except to correct the erroneous Kansas malpractice GPCI discussed above. Since the revised GPCIs could result in total payments either greater or less than payments that would have been made if the GPCIs were not revised, it was necessary to adjust the GPCIs for budget neutrality as required by law. Therefore, we adjusted the 2001 through 2002 GPCIs as follows: work by 0.99699; practice expense by 0.99235; and malpractice by 1.00215.
Resource-based malpractice RVUs replaced the prior charge-based malpractice RVUs on January 1, 2000. A detailed description of the methodology used in establishing the 2000 malpractice RVUs can be found in the July 1999 proposed rule (64 FR 39610) and the November 1999 final rule (64 FR 59383). The 2000 malpractice RVUs are based on 1993 through 1995 malpractice insurance premium data, the latest data available when we began collecting data to establish the resource-based malpractice RVUs. We stated in last year's proposed and final rules that we were collecting more recent premium data, and would update the malpractice RVUs as soon as we had finished collecting and analyzing the more recent data.
In the July 2000 proposed rule we stated that we had obtained, and were currently examining, malpractice premium data for 1996 through 1998. We provided a table that compared the 1993 through 1995 average premiums (used to calculate the 2000 malpractice RVUs) with the 1996 through 1998 average premiums (used to calculate the 2001 malpractice RVUs). The table showed that there was very little change in the national average premiums from 1993 through 1995 to 1996 through 1998. We, therefore, anticipated minimal changes in malpractice RVUs from use of the more recent data.
In addition, in response to comments received on last year's rule, we proposed to accept a comment regarding crosswalking specialties. We proposed to crosswalk surgical oncology to general surgery rather than to all physicians. We also indicated that the malpractice values to be included in the final rule reflecting the updated data would remain interim.
The purpose of the resource-based malpractice RVUs is not to guarantee each physician an absolute return of malpractice costs. It is rather to construct malpractice RVUs based on the relative malpractice costs among services. We believe that it is reasonable to use the lower risk factors for the values of the lower risk services and to allocate the higher relative values to the higher risk services that cause them. In the case of OB/GYN services, the higher obstetrical premiums were used for services that were clearly obstetrical and were causing the higher obstetrical premiums; the gynecological surgical risk factor was used for the surgical services, and the lower nonsurgical GYN risk factor was used for all other services. We would further note that even if we were to adopt the approach suggested by this comment, it would have very little, if any, impact on payment rates since OB/GYN specialties perform such a small proportion of the low risk visits provided to patients in the U.S.
New malpractice RVUs based on the more recent 1996 through 1998 premium data will become effective on January 1, 2001. These malpractice RVUs will be considered interim for 2001 and subject to comment and possible revision in 2002. These malpractice RVUs can be found in Addendum B.
Based on revisions to the definition of critical care services (CPT codes 99291 and 99292) in the CPT manual for CY 2001, we proposed to value the physician work at 4.0 RVUs for CPT code 99291 and 2.0 RVUs for CPT code 99292.
In addition, consistent with our discussion in the July 2000 proposed rule for electrical bioimpedance (EB), (see section H), we proposed not to allow separate Medicare payment for EB when it is furnished in conjunction with critical care services (CPT codes 99291 and 99292).
We will finalize our proposal and value the physician work at 4.0 RVUs for CPT code 99291 and 2.0 RVUs for CPT code 99292. In addition, we will not allow separate Medicare payment for EB when provided in conjunction with critical care services (CPT codes 99291 and 99292).
In anticipation of CPT revisions to the definition of care plan oversight, we proposed establishing two new HCPCS codes for care plan oversight to be consistent with our payment policies. For the 2001 physician fee schedule, we proposed adding a new HCPCS code G0181 (care plan oversight, home health), using the CPT 2000 definition associated with CPT code 99375 and a new HCPCS code G0182 (care plan oversight, hospice) using the CPT 2000 definition associated with CPT code 99378. The definitions proposed for these new codes are:
G0181 Physician supervision of a patient under care of Medicare-covered home health agency (patient not present) requiring complex and multidisciplinary care modalities involving regular physician development and/or revision of care plans, review of laboratory and other studies, communication (including telephone calls) with other health care professionals involved with the patient's care, integration of new information into the treatment plan and/or adjustment of medical therapy, within a calendar month; 30 minutes or more.
G0182 Physician supervision of a patient under care of Medicare-covered hospice (patient not present) requiring complex and multidisciplinary care modalities involving regular physician development and/or revision of care plans, review of laboratory and other studies, communication (including telephone calls) with other health care professionals involved with the patient's care, integration of new information into the treatment plan and/or adjustment of medical therapy, within a calendar month; 30 minutes or more.
We also stated that current policy guidance that applied to CPT codes 99375 and 99378 will continue to apply to these G codes, and current payments for CPT codes 99375 and 99378 will be maintained in G0181 and G0182.
In addition, we proposed establishing two new HCPCS codes (G0180 and G0179) to describe the physician's services involved in physician certification (and recertification) of Medicare-covered home health services. These services include creation and review of a plan of care for a patient and verification that the home health agency initially complies with the physician's plan of care. The physician's work in reviewing data collected in the home health agency's patient assessment, including the Outcome and Assessment Information Set (OASIS) data, would be included in these services.
The proposed text for the new codes was as follows:
• G0180 (referred to as Gxxx3 in the proposal but renumbered in this final rule) Physician services for the initial certification of Medicare-covered home health services, for a patient's home health certification period, and
• G0179 (referred to as Gxxx4 in the proposal but renumbered in this final rule) Physician services for the
Under the proposed rule, the use of these codes would have been restricted to physicians who are permitted to certify that home health services are required by a patient according to section 1814(a)(2)(C) and section 1835(a)(2)(A) of the Act.
Under the proposed rule, the physician certification for home health code (G0180), could be reported only once every 60 days, except in the rare situation when the patient starts a new episode before 60 days elapses and requires a new plan of care to start a new episode. For services within the episode (generally beyond the first week or two of care plan implementation) that are consistent with the definition of care plan oversight, the care plan oversight code (G0181) would be used.
Because we believed that the physician work associated with HCPCS code G0180 is equivalent to that of a level 3 established patient office visit (CPT code 99213), we proposed a value of 0.67 for the work RVUs. For G0179, we proposed a value of 0.45 work RVUs because we believe the work equates to a level 2 established patient office visit (CPT code 99212). For practice expense RVUs, we proposed to crosswalk both G0180 and G0179 to the practice expense inputs currently used for care plan oversight (CPT code 99375), since both the certification and recertification and care plan oversight codes do not require a face-to-face encounter between the beneficiary and the physician.
While we recognize that non-health professionals contribute to the care of both home health and hospice patients, our long-standing policy has been that payment for these services is included in the payment for evaluation and management services. As we indicated in the December 8, 1994 final rule (59 FR 63421) that originally established Medicare policies for care plan oversight services, we recognize for separate payment only the physician's communications to the health care professionals involved in the patient's care. The goal in care plan management is to be certain that the home health or hospice professional staff communicate with the patient's physician to allow the beneficiary to receive appropriate care. This continues to be the justification for an additional payment.
For care plan oversight, we are establishing the following two new codes as proposed:
• G0181 Physician supervision of a patient receiving Medicare-covered services from a participating home health agency (patient not present) requiring complex and multidisciplinary care modalities involving regular physician development and/or revision of care plans, review of subsequent reports of patient status, review of laboratory and other studies, communication (including telephone calls) with other health care professionals involved in patient's care, integration of new information into the medical treatment plan and/or adjustment of medical therapy, within a calendar month; 30 minutes or more, and
• G0182 Physician supervision of a patient receiving Medicare-covered services from a Medicare-participating hospice (patient not present) requiring complex and multidisciplinary care modalities involving regular physician development and/or revision of care plans, review of subsequent reports of patient status, review of laboratory and other studies, communication (including phone calls) with other health professionals involved in patient's care, integration of new information into the medical treatment plan and/or adjustment of medical therapy, within a calendar month; 30 minutes or more.
As stated in the proposed rule, current policy guidance that applied to CPT codes 99375 and 99378 will continue to apply to these G codes, and current payments for CPT codes 99375 and 99378 will be maintained in G0181 and G0182, respectively.
For the services involved in physician certification (and recertification) and the development of a plan of care for a patient for whom the physician has prescribed Medicare-covered home health services, we are establishing two new codes as proposed:
• G0180 Physician services for initial certification of Medicare-covered home health services, billable once for a patient's home health certification period. This code will be used when the patient has not received Medicare-covered home health services for at least 60 days.
• G0179 Physician services for recertification of Medicare-covered home health services, billable once for a patient's home health certification period. This code would be used after a patient has received services for at least 60 days (or one certification period) when the physician signs the certification after the initial certification period.
The G0179 code will be reported only once every 60 days, except in the rare situation when the patient starts a new episode before 60 days elapses and requires a new plan of care to start a new episode. For services within the episode that are consistent with the definition of care plan oversight, the care plan oversight code (G0181) would be used.
Consistent with section 1835(a)(2) of the Act, a physician who has a significant ownership interest in, or a significant financial or contractual relationship with a home health agency (HHA), generally cannot bill this code for patients served by that HHA.
We have retained the proposed relative values, for the reasons stated earlier. The physician work associated with HCPCS code G0180 will be valued at 0.67 and for G0179 the physician work will be valued at 0.45. We will use the practice expense inputs used for care plan oversight (G0181) for both codes.
In the July 17, 2000 proposed rule (65 FR 44196) we indicated that allowing payment under the fee schedule for CPT codes 99234 through 99236, Observation or inpatient hospital care services (including the admission and discharge services) for a patient on the same date, conflicts with two policies currently in the Medicare Carrier Manual (MCM). Section 15505.1(c) in the MCM states that we only pay for a hospital admission when a patient is admitted as an inpatient and is discharged on the same day. Section 15504.b of the MCM states that CPT codes 99218 through 99220 (Initial Observation Care) should be used if the patient is discharged on the same day as the admission for observation only. Observation care discharge (CPT code
These policies also result in different payments for patients whose inpatient stay is less than 24 hours based solely on whether they were in the hospital at midnight. For example, a physician who admits a patient to observation or to inpatient care at 8 a.m. and then discharges the patient at 8 p.m. the same day is paid for only the admission service. On the other hand, a physician who admits a patient to observation or to inpatient care at 8 p.m. and then discharges the patient at 8 a.m. the next day, is allowed payment for both the admission and discharge services.
In response to these concerns, and to clarify our payment policy, we proposed the following:
We would pay for both inpatient hospital admission services (CPT codes 99221 through 99223) and hospital discharge services (CPT codes 99238 and 99239) when a patient is a hospital inpatient for a period of 24 hours or more. The medical record would have to document that the patient was an inpatient for at least 24 hours for both of these services to be paid.
If a patient is admitted as a hospital inpatient or an observation care patient for less than 8 hours, we will pay for only the admission service (CPT codes 99221 to 99223 or 99218 to 99220) on that day. The discharge service is not a separately billable service.
If a patient is admitted as a hospital inpatient or an observation care patient for a period of 8 or more hours, but less than 24 hours, we will pay for both the admission and discharge services under CPT codes 99234 through 99236 with the following proposed physician work RVUs and documentation requirements:
To properly value both the admission and discharge work of these services, we proposed to continue valuing the admission portion of the physician work as equivalent to CPT codes 99218 through 99220 (or CPT codes 99221 through 99223) and to reduce the discharge work RVUs from 1.28 to 0.67. Thus, the work RVUs would be as follows: CPT code 99234—1.95 RVUs; CPT code 99235—2.81 RVUs; CPT code 99236—3.66 RVUs. Our policy would allow payment for CPT codes 99234 through 99236 only for stays of equal to or greater than 8 hours, but less than 24 hours.
In addition to the documentation guidelines for history, physical examination, and medical decision making described in CPT 2000 for CPT codes 99234 through 99236, we proposed requiring the following to be documented in the medical record:
• A stay involving 8 hours, but less than 24 hours.
• The billing physician was present and personally performed the services.
• The admission and discharge notes were written by the billing physician.
We disagree with the commenters on the subject of documentation. We do not believe it is onerous to require a physician to document the length of time the patient remains in observation status. Minimal documentation, such as noting the hours in observation status, is required in the medical record to do this. There are other reasons to document the time a patient was seen and orders were written. For example, such documentation allows physicians and facilities to improve the quality of care they deliver. We also continue to believe that a recorded time requirement is necessary to assure that patients are truly being observed and treated for conditions that require ongoing care. Regarding payment for admission and discharge on the same day, we have long established policy that we will pay for only one E/M service per physician per patient per day for the same diagnosis, and we do not wish to revisit that policy.
Admission and discharge of a patient from observation or the hospital on the same calendar date should be billed as CPT code 99234 or 99235 or 99236. The hospital and observation admission/discharge codes should be used when a patient is admitted and discharged on different calendar dates.
In view of the foregoing explanation, our policy is as follows:
• The relative work values of CPT codes 99234 through 99236 will remain unchanged.
• For a physician to appropriately report CPT codes 99234 through 99236 for Medicare payment, the patient must be an inpatient or an observation care patient for a minimum of 8 hours on the same calendar date.
• When the patient is admitted to observation status for less than 8 hours on the same date, then CPT codes 99218 through 99220 should be used by the physician and no discharge code should be reported.
• When patients are admitted for observation care and then discharged on a different calendar date, the physician should use CPT codes 99218 through 99220 and CPT observation discharge code 99217.
• When patients are admitted to inpatient hospital care and then discharged on a different calendar date, the physician should use CPT codes 99221 through 99223 and CPT hospital discharge day management codes 99238 or 99239.
• For an inpatient admission and discharge less than 8 hours later on the same calendar date, CPT codes 99221 through 99223 should be used for the admission service, and the hospital discharge day management service should not be billed.
• The physician must satisfy the documentation requirements for both admission to and discharge from inpatient or observation care to bill CPT codes 99234, 99235, or 99236. The length of time for observation care or treatment status must also be documented.
We believe that this policy meets the concerns of the commenters and allows us to resolve the discrepancies in payment policy regarding same day hospital and observation care admission and discharge.
The work RVUs for CPT codes 99234 through 99236 used for reporting admission for observation care, or inpatient hospital care and discharge on the same calendar date will not be changed. The policies outlined above must be followed when reporting these codes.
Ocular photodynamic therapy (OPT) is a treatment recently approved by the Food and Drug Administration for age-related macular degeneration, the most common cause of blindness in the elderly. For CPT 2000, ocular photodynamic therapy was added to CPT code 67220, which was formerly limited to photocoagulation by laser. Because we believe that OPT is significantly different from laser photocoagulation, we proposed to establish new HCPCS codes that specifically identify these procedures as follows:
Gxxx5—“Destruction of localized lesion of choroid (
Gxxx6—“Destruction of localized lesion of choroid (
We also proposed the following practice expense inputs for non-facility settings:
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In instances where both eyes are treated the same day, we proposed the use of the following HCPCS add-on code: Gxxx7—“Destruction of localized lesion of choroid (
• Clinical Staff Time. Registered nurse/ophthalmology technician—5 minutes;
• Supplies. Ophthaine, mydriacil, myolfrin, and gonisol.
In addition, we identified several other specific ophthalmological treatments that are not distinctly identified in CPT 2000. We proposed to establish specific HCPCS codes for these procedures:
“Destruction of localized lesion of choroid (
“Destruction of localized lesion of choroid (
“Destruction of macular drusen, photocoagulation, one or more sessions”.
We did not propose RVUs for HCPCS codes Gxxx8 through Gxx10 and indicated that the procedures represented experimental procedures and that the codes would be used for tracking purposes.
Since publication of the proposed rule, the AMA CPT editorial panel has approved a CPT code for Ocular Photodynamic Therapy, CPT code 67221, effective for CPT 2001, and removed the procedure as an example of a service included in CPT code 67220. In addition, verteporfin has been approved for inclusion in the United States Pharmacopeia and can now be billed separately as a drug under the Medicare program.
We will continue to recognize CPT code 67220 “Destruction of localized lesion of choroids (
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For G0184 “Destruction of localized lesion of choroid (
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In addition, we are establishing the following HCPCS codes for other ophthalmologic procedures:
G0185 for “Destruction of localized lesion of choroid (
Electrical bioimpedance (EB), a noninvasive method of measuring cardiac input, is a covered procedure under Medicare, if medically necessary. Performance of this procedure is reported by the Level 2 HCPCS code M0302, and the procedure is currently carrier-priced. In the July 17, 2000 rule, we proposed the following RVUs for this procedure:
We proposed the following direct inputs for determining practice expense RVUs.
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We proposed 0.02 RVUs for this procedure.
We stated that with respect to RVUs for physician work, we had insufficient information to propose a work value and invited comments on this subject.
We also proposed that the payment for this procedure be included in reporting critical care. Therefore, separate payment would not be made for this procedure when provided in conjunction with critical care services (CPT codes 99291 and 99292).
The fact that the information gained from a test is used in making treatment decisions is irrelevant to the issue of determining physician work (for example, results of urinalyses, complete blood counts (CBCs) are used to make clinical decisions, but these tests do not contain a physician work component). For example, it is possible to make an electrocardigraphic diagnosis (for example, left ventricular hypertrophy, acute Myocardial Infarction, Heart Block) through analysis of the waveforms on an EKG without a clinical evaluation of the patient. This separately identifiable work is what justifies establishment of work RVUs for interpretation of EKGs. It is not as easy to identify separately identifiable work in the case of cardiac bioimpedance. The measurements produced by cardiac bioimpedance include blood pressure, pulse, cardiac output, vascular resistance and thoracic fluid content. Generally, abnormalities in any of these do not allow a diagnosis to be made (for example, hypertension or heart failure). These measurements are used to provide additional information to a physician who is clinically evaluating a patient, in much the same way that results of a CBC and urinalysis are used. However, after reviewing the comments, we currently believe there is a small amount of physician work in interpreting the measurements produced by cardiac bioimpedance that is not billable as part of an E/M service. For example, if a physician reviews, interprets, and issues a report, then separate work can be identified.
We believe that this physician work is most similar to the work of interpreting an EKG and have assigned a work RVU of .17 for the professional component of cardiac bioimpedance. We wish to emphasize that in order for the PC to be billed, all the requirements for billing a diagnostic test must be satisfied. We will also bundle the PC into critical care when critical care services are furnished, since the critical care service includes the review of such tests. Furthermore, we will allow this service to be billed once per physician, per patient, per day.
For HCPCS code M0302, we are establishing a work RVU of .17, a malpractice value of .02 and are using the following inputs for PE
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We note that there is a TC and a PC for this service. The direct practice expense inputs listed above will be part of the TC.
We proposed to change the global period for the insertion, removal, and replacement of pacemakers and cardioverter defibrillators (CPT codes 33206, 33207, 33208, 33212, 33213, 33214, 33216, 33217, 33218, 33220, 33233, 33234, 33235, 33240, 33241, 33244, 33249, 33282, and 33284) to 0 days. This would permit separate payment for any care furnished during the post-operative period by the physician who performed the pacemaker or cardioverter defibrillator procedure. We also proposed an adjustment to the physician work RVUs and practice expense inputs to reflect the change in global period for these codes.
Our proposed policy was intended to facilitate separate payment for the evaluation and management services unrelated to the surgical service. Our concern was that the 90-day global period was precluding separate payment for the evaluation and management services. However, we received comments that indicated that cardiologists do not typically provide the post-operative services related to surgical service. If this is the case, we believe that a 0-day global period is appropriate for these procedures. Moreover, if the comment is accurate, the current (not the proposed) work and practice expense RVUs are likely overstated because these values are based on one physician providing both the surgical and post-operative services. In general, we believe that the refinement process is useful for revaluing services when the nature of the service has changed from its previous valuation. If the commenters are correct, the issue of the global period and appropriate relative value units for these services will need further review. We look forward to working with the physician community to better understand the typical practice with regard to the provision of services related to insertion, removal and replacement of pacemakers and cardioverter defibrillators. We welcome any review of this issue that may be undertaken by the RUC as part of their recommendation related to the 5-year review of work and the PEAC on issues related to practice expense.
Nevertheless, we are not finalizing our proposal with respect to this issue because we believe that physicians have raised valid concerns that the adjustment to the work RVU in the proposal may result in an underpayment for the service. Until there is further review of this issue, we are continuing with current pricing for these services and the use of a 90-day global period.
No change will be made to the global period for CPT codes 33206, 33207, 33208, 33212, 33213, 33214, 33216, 33217, 33218, 33220, 33233, 33234, 33235, 33240, 33241, 33244, 33249, 33282, and 33284 in this rule.
In the July 2000 rule we proposed amending § 410.68(b), Antigens: Scope and conditions, to change the limitation of antigen supply from 12-weeks to 12-months to be more reflective of current industry standards and guidelines.
We are revising the regulation at § 410.68(b) as proposed.
We proposed to remove the RVUs that were assigned to CPT code 20979, low intensity ultrasound stimulation to aid bone healing. We made this proposal because of concerns raised by commenters, and because the service was a noncovered service under Medicare.
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In addition, we are assigning a global period of “XXX”. However, we expect that CPT code 20979 will be billed only once per treatment period, and we will require the use of the -25 modifier with any E/M service billed by a physician for the same patient on the same day as CPT code 20979. Therefore, any E/M service billed in addition to CPT code 20979 must be distinct and separately identifiable.
We are assigning .62 work RVUs and .04 malpractice RVUs to CPT code 20979 (which are the values also used for CPT code 20974) and the direct inputs of: technician time of 45 min., an exam table, and minimum supply package will be used to determine practice expense. We note that the inputs for practice expense are subject to refinement.
In the July 2000 rule, we proposed to revise the practice expense RVUs associated with the CPT codes 33975 and 33976 (implantation of ventricular assist devices) to reflect an “XXX” global period. The purpose of this revision was to ensure that the practice expense RVUs reflect the global period change published in the April 11, 2000 correction notice (65 FR 19332) to the November 1999 final rule. No comments were received on this proposal and we are finalizing it as proposed.
We currently do not have a national policy that instructs carriers on the method of payment for a service when the anesthesiologist does not fulfill all the medical direction requirements. One option carriers may use is instructing the anesthesiologist to report this service as a reduced or unusual service to determine appropriate payment. We did not make a specific proposal, but indicated that we would like to clarify this policy. We outlined possible options in the July 2000 proposed rule that could be alternatives for future rulemaking consideration. We requested comments, particularly from physicians and practitioners most affected by this policy.
We received comments from both of the major anesthesia groups, the American Society of Anesthesiologists and the American Association of Nurse Anesthetists, as well as a few state anesthesiology groups and practicing anesthesiologists. We will review these suggestions as we determine whether to make a future proposal.
In the July 2000 proposed rule, we clarified that we will continue to pay separately for certain diagnostic codes, including pulse oximetry (CPT codes 94760 and 94761), when they are medically necessary and there are no other services payable under the physician fee schedule billed on the same date by the same supplier.
We will continue with the policy of bundling payment for pulse oximetry (CPT codes 94760 and 94761) when it is provided on the same day as another service. Separate payment for these codes may be made only when the services are medically necessary and there are no other services payable under the physician fee schedule billed on the same date by the same supplier.
In the July 2000 proposed rule, we clarified that therapy assistants must be personally supervised by the therapist in private practice and employed directly by the therapist, by the partnership or group to which the therapist belongs. We did not make a proposal, and the discussion was provided for informational purposes only. We felt that this explanation was necessary, since revisions in the November 1998 final rule (63 FR 58814) had prompted confusion in the therapy industry. They believed that we had misinterpreted the supervision requirement or had established a new requirement for therapy assistants in the private practice setting. We wanted to clarify that the requirements for therapy assistants in a private practice setting had not changed from the longstanding requirements established in Medicare Carriers Manual (MCM) instructions (see section 2215F, HCFA Pub. 6) revised in 1981.
Section 221 of the BBRA placed a 2-year moratorium on Medicare Part B outpatient therapy caps (the $1500 cap on outpatient physical therapy services including speech language-pathology services and the $1500 cap on outpatient occupational therapy services in all nonhospital settings). The two $1500 caps were implemented in 1999 as required by the BBA.
The BBRA also requires us to submit to the Congress a report by January 1,
In the July 17, 2000 rule, we provided examples of informal recommendations we have received on this issue, and asked for comments from the public on other alternatives that we might consider in developing a payment policy for outpatient therapy services. We indicated that this information would be considered in preparing our report to Congress on outpatient therapy services.
Several organizations commented on the issue of outpatient therapy caps. Some groups responded to the examples provided in the proposed rule, while others offered other alternatives. We appreciate the information provided and will consider it as we develop the report to Congress.
Several commenters recommended that, instead of creating G codes, we work more closely with the AMA CPT Editorial Panel to establish or revise CPT codes to meet our requirements.
We have a long-established working relationship with the AMA CPT Editorial Panel. We prefer the use of CPT codes to the use of G codes for reporting physicians' services. In fact, this year, we initiated the establishment of a new CPT code that describes ocular photodynamic therapy (67221) for CPT 2001, and the revision of an old CPT code (67220) to remove ocular photodynamic therapy. We did this proactively to avoid the need to establish a G code. We, along with the ophthalmology societies, brought these recommendations to the CPT Editorial Panel. Thus we were able to withdraw our proposal for a G code for ocular photodynamic therapy. We also worked with the panel to establish CPT codes for artificial skin placement and wound care management that will enable to us to retire our G codes for these services.
We believe that sometimes HCPCS level 2 codes are useful to the CPT Editorial Panel process. For example, use of a new service can be tracked with the G codes to determine if a future CPT code is appropriate.
Frequently, we create G codes to reflect our own coverage and payment requirements. These requirements are usually very specific, and may make it inappropriate to create a CPT code for general use.
Moreover, in response to requests from physicians and others, we make coverage decisions on a rolling basis. Because the CPT process requires at least 1 year between approval and implementation of a CPT code, we must create a G code during the interim. We occasionally have specific coverage and payment requirements according to which Medicare payment is not made for a specific CPT code. This was the case with the revision of the care plan oversight codes. We specifically informed the CPT Editorial Panel before the codes were revised that the proposed revisions would be inconsistent with our established payment policy, and, therefore, we would need to create G codes for care plan oversight and not use the revised CPT codes. Similarly, we are finalizing our proposal to create G codes for several ophthalmologic procedures to track the use of these services and permit coverage and payment on a carrier-by-carrier basis. We had comments from the appropriate medical specialty societies, and determined that it was not appropriate to create CPT codes for these services at present. The specialty societies supported our creation of the G codes; this mechanism permits payment for these services while establishing a way to track their use. In the case of physician certification and recertification of a plan of care for home health services, we created two new G codes because of our interest in providing explicit payment for these services as a result of development of the home health prospective payment system (PPS). As we indicated in the home health PPS rule (65 FR 41163), we have decided to “focus our attention on physician certification efforts and education in order to better involve the physician in the delivery of home health services.” While we are imposing no new regulatory requirements on physicians related to these services, we felt that it was important to establish these two new codes quickly to allow separate payment for these services as soon as possible after implementation of the home health PPS on October 1, 2000.
Use of G codes is also consistent with section 1848(c)(5) of the Act, which specifically provides us with the authority to establish a uniform procedure coding system for the coding of all physicians' services.
In summary, we support the use of CPT codes. We establish G codes only when absolutely necessary. We would like to assure the medical community that we will continue work with the AMA CPT Editorial Panel to minimize the need for G codes. However, we have the responsibility for developing and implementing payment policy for the Medicare program. On occasion, we need to establish G codes to appropriately administer the Medicare program.
In the July 17, 2000 proposed rule (65 FR 44201), we included a discussion on the activities underway with respect to the second five-year refinement of work RVUs. We indicated that we had received comments on potentially misvalued services from approximately 30 specialty groups, organizations and individuals, involving over 900 codes. We shared these comments with the RUC, which makes recommendations to us on the assignment of RVUs to new and revised CPT codes. We also discussed current initiatives involving the validation of physician time data.
Section IV.B. of this final rule describes the methodology used to review the comments received on the RVUs for physician work and the process used to establish RVUs for new and revised CPT codes. Changes to codes on the physician fee schedule reflected in Addendum B are effective for services furnished beginning January 1, 2001.
Our November 2, 1999 final rule on the 2000 physician fee schedule (64 FR 59380) announced the final work RVUs for Medicare payment for existing procedure codes under the physician fee schedule and interim RVUs for new and revised codes. The RVUs contained in the rule apply to physician services furnished beginning January 1, 2000. We announced that we considered the RVUs for the interim codes to be subject to public comment under the annual refinement process. In this section, we summarize the refinements to the interim work RVUs that have occurred since publication of the November 1999 final rule and our establishment of the work RVUs for new and revised codes for the 2001 fee schedule.
Although the RVUs in the November 1999 final rule were used to calculate 2000 payment amounts, we considered the RVUs for the new or revised codes to be interim. We accepted comments for a period of 60 days. We received substantive comments from approximately 11 specialty societies on approximately 29 CPT codes with interim work RVUs. Only comments on codes listed in Addendum C of the November 1999 final rule were considered.
We used a process similar to the process used in 1997. (See the October 31, 1997 final rule on the physician fee schedule (62 FR 59084) for the discussion of refinement of CPT codes with interim work RVUs.) We convened a multispecialty panel of physicians to assist us in the review of the comments. The comments that we did not submit to panel review are discussed at the end of this section, as well as those that were reviewed by the panel. We invited one representative from each of those specialty societies from which substantive comments were received to attend a panel for discussion of the codes on which they had commented. The panel was moderated by our medical staff, and consisted of the following representatives.
• One or two clinicians representing the commenting specialty(s), based upon our determination of those specialties which are most identified with the service(s) in question. Although commenting specialties were welcomed to observe the entire refinement process, they were
• Two Primary care clinicians nominated by the American Academy of Family Physicians and the American Society of Internal Medicine.
• Five Carrier medical directors.
• Four clinicians with practices in related specialties, who were expected to have knowledge of the services under review.
The panel discussed the work involved in each procedure under review in comparison to the work associated with other services on the fee schedule. We had assembled a set of reference services, and asked the panel members to compare the clinical aspects of the work of services they believed were incorrectly valued to one or more of the reference services. In compiling the set, we attempted to include—(1) services that are commonly performed whose work RVUs are not controversial; (2) services that span the entire spectrum from the easiest to the most difficult; and (3) at least three services performed by each of the major specialties so that each specialty would be represented. The set listed approximately 300 services. Group members were encouraged to make comparisons to reference services. The intent of the panel process was to capture each participant's independent judgement based on the discussion and his or her clinical experience. Following each discussion, each participant rated the work for the procedure. Ratings were individual and confidential, and there was no attempt to achieve consensus among the panel members.
We then analyzed the ratings based on a presumption that the interim RVUs were correct. To overcome this presumption, the inaccuracy of the interim RVUs had to be apparent to the broad range of physicians participating in each panel.
Ratings of work were analyzed for consistency among the groups represented on each panel. In general terms, we used statistical tests to determine whether there was enough agreement among the groups of the panel, and whether the agreed-upon RVUs were significantly different from the interim RVUs published in Addendum C of the November 1999 final rule. We did not modify the RVUs unless there was a clear indication for a change. If there was agreement across groups for change, but the groups did not agree on what the new RVUs should be, we eliminated the outlier group, and looked for agreement among the remaining groups as the basis for new RVUs. We used the same methodology in analyzing the ratings that we first used in the refinement process for the 1993 fee schedule. The statistical tests were described in detail in the November 25, 1992 final rule (57 FR 55938).
Our decision to convene multispecialty panels of physicians and to apply the statistical tests described above was based on our need to balance
We also received comments on RVUs that were interim for 2000, but which we did not submit to the panel for review for a variety of reasons. These comments and our decisions on those comments are discussed in further detail below.
The table below lists the interim and related codes reviewed during the refinement process described in this section. This table includes the following information:
• CPT Code. This is the CPT code for a service.
• Description. This is an abbreviated version of the narrative description of the code.
• 2000 Work RVU. The work RVUs that appeared in the November 1999 rule are shown for each reviewed code.
• Requested Work RVU. This column identifies the work RVUs requested by commenters.
• 2001 Work RVU. This column contains the final RVUs for physician work.
2. Interim 2000 Codes.
CPT code 11980 Subcutaneous hormone pellet implantation.
We did not receive a work RVU recommendation from the RUC for this code, and therefore crosswalked it to CPT 11980 for the 2000 fee schedule. One commenter indicated that a recommendation for work RVUs would be included in the RUC recommendations for 2001, and urged that we accept this RVU recommendation.
We reduced the work RVU for 27096 from the RUC proposed value of 1.40 to 1.10 based on a weighted average with CPT code 20610 (Large joint injection-work RVU of 0.79) Commenters pointed out that while this was one of the codes used prior to approval of CPT code 27096, it (20610) was cited as being inadequate, because the sacroiliac joint injection requires more precision and skill than does a large joint (for example, hip) injection. They also indicated that the reduction made by HCFA to account for the fact that this procedure may be performed without contrast was not justified. In light of these comments we referred the code to a refinement panel for review.
The RUC evaluated this code using a building block approach that included the work of sterotactic localization, the device implantation and 140 minutes of intra-operative testing.
A few commenters expressed concern about our rejection of the RUC recommendation of 27.34 work RVUs and our proposed 19.34 work RVUs. We subtracted 8.00 RVUs attributed to 140 minutes of intra-operative testing, since this time was variable and it could be reported under other CPT codes. The commenters explained that the assignment of surgeon work during this 140 minutes of electrode maneuvering was done by comparing the work, including intensity, to CPT code 99291 at an equivalent rate of 4.00 RVUs for each of the approximately 2 hours in this average. Information was provided during the discussion at the RUC that the time of 140 minutes was truly an average, with some testing requiring as long as 3 to 4 hours to achieve satisfactory electrode placement. The commenters recommended that we restore the missing 8.00 RVUs and accept the RUC recommendation of 27.34 for this code. Due to the questions concerning our reduction of 8.00 RVUs, we referred this code to a refinement panel for review.
CPT Code 61885 was revised to add a delimiter to the code that specified connection of the neurostimulator to a single electrode array, and a new code (CPT code 61886) was introduced for situations involving two or more electrode arrays. We had received recommendations for work RVUs for the revised CPT code 61885, as well as the new CPT code 61886. Commenters disagreed with our statement that there was no evidence to justify an increase in the work RVU for CPT code 61885. We also noted that the work RVU for this code had been increased in the last 5-year review. Commenters felt that the RUC analyses presented supported an increase in the work RVU. In light of these comments, we referred this code to the refinement panel for review.
This was a new CPT code for which the RUC had recommended work RVUs of 7.20. We reduced the value to 6.02 based on two determinations—(1) that the RUC had erroneously counted the insertion of a catheter twice in compiling the component services; and (2) the appropriate building block for the fluoroscopic guidance was code 76003, not 76005. Commenters requested that we reconsider these decisions. They indicated that they had intentionally doubled the value for catheter insertion, as insertion of a catheter into a tight scarred epidural space involved more work than the typical epidural injection. They also felt that the fluoroscopic code the RUC had used was appropriate, and more accurately reflected the work involved. In response to these comments, we referred this code to the refinement panel for review.
We had agreed with the relativity of these new codes established by the RUC, but in order to retain budget neutrality within this family of codes, we had to uniformly reduce the RUC recommended values. Commenters indicated that our calculations of the amount of reduction in the work RVUs needed slight adjustments. The specialties involved in developing the work RVUs submitted the following re-scaled work RVUs that they felt were a better reflection of the budget neutrality adjustment while preserving the intra-family relativity of the new codes (62310-1.95; 62311-1.57; 62318-2.26; and 62319-1.88).
We reduced the work RVUs for this new code by approximately one third, from the 0.83 recommended by RUC to 0.54. Commenters disagreed with this reduction, noting that the comparison codes selected by HCFA medical staff to support this reduction did not accurately reflect the work involved. They indicated that the RUC survey reflected that there was a greater amount of time involved. This code was referred to the refinement panel for review.
The RUC recommended value of 0.64 work RVUs was reduced to 0.54 work RVUs based on our belief that there was no difference in work from the primary survey reference code (CPT code 73525 which has a work RVU of 0.54). Commenters disagreed with this reduction. Although the time estimates between CPT code 73542 and the reference code are similar, the mean intensity/complexity measures are consistently higher for CPT code 73542, and therefore warranted the RUC recommended work RVU of .64. The RUC valued this code not only according to the time required, but also according to the intensity of the service. Commenters recommended adoption of the RUC work RVUs of 0.64 for CPT code 73542. This code was referred to the refinement panel for review.
The RUC recommended value of 0.60 work RVUs for this new code was reduced to 0.54, because we did not believe there was enough difference in work from the primary survey reference code 76003 (0.54 work RVUs). Commenters disagreed with this determination, and indicated that the survey data results were evidence that comparison between CPT codes 76005 and 76003 was not appropriate, since the survey showed more time for CPT code 76005, as well as a consistently higher estimation of intensity and complexity. Commenters also pointed out that another established code in the same family (CPT code 76001 with a work RVU of .67) was also previously used to report this service.
We reduced the RUC recommendation of 1.92 work RVUs to .99, since we did not believe that general anesthesia is used in this procedure. Commenters disagreed with this point and indicated that, because the patient must remain motionless during the procedure, significant sedation, either general or spinal anesthesia, is used. Thus, this is usually performed in a hospital operating room (outpatient) or ambulatory surgical center. Commenters also objected to the comparison we made between this code (76873) and CPT code 76805 Echography, pregnant uterus, B-scan and/or real time with image documentation; complete. An obstetric ultrasound does not require anesthesia and is done in a physician's office. Commenters also questioned our statement that we would not allow payment for a prostate volume study when performed on the same day as seed implantation or other services that are part of seed implantation. During the RUC deliberations, it was specifically discussed that the prostate volume study was
In the final rule published November 2, 1999, we included a discussion of practice expense inputs and omitted a discussion of the RUC recommended work RVUs for these codes. Commenters encouraged us to publish the values for these codes, noting that while these are not reimbursed under the Medicare program, fee schedule values provide guidance to other payers who use the fee schedule.
We reduced the RUC recommendations for work RVUs for these codes (93741-0.64; 93742-0.73; 93743-0.83, and 93744-0.95) because we felt there were inconsistencies between the recommendations and the survey data. Commenters stated that the differences in time reflected between the earlier surveys and three 1998 and 1999 surveys were a result of the large increase in the complexity of the technologies associated with these procedures over the last few years. With older devices, there was less information to analyze. The new technology provides more information, thus, the work involved is significantly greater than it was when the reference procedure was initially evaluated. These codes were referred to the refinement panel for review.
We received the following comments on the interim practice expense RVUs assigned to the new and revised CPT codes for 2000:
A specialty group commented that the practice expense RVUs for this code should be slightly higher than for CPT code 33406, Replacement, aortic valve, with cardiopulmonary bypass; with homograft valve (freehand), due to the difference in the grafts. However, the practice expense RVUs for CPT code 33410 are 0.09 less than the practice expense RVUs for CPT code 33406. The commenter adds that, due to this error, physicians have received unfairly low reimbursement for this procedure in CY 2000, and should receive fair compensation after this error is corrected.
We received comments from two organizations representing cardiology and pacing electrophysiology on the interim PE RVUs for this procedure. Both commenters indicated that the practice expense RVUs should be increased to account for the fact that under the revised definition, this procedure now includes the implantation of dual chamber ICDs.
One organization indicated that, for the PE inputs, we crosswalked this code to CPT code 93610, intra-atrial pacing, which does not include costs associated with a cardioversion, which is part of the procedure. They recommended that we use a building block approach, using inputs from CPT code 93610-26 (a similar intra-atrial pacing code) and CPT code 92960 (a similar cardioversion code) for establishing the PE RVUs.
Two organizations objected to our crosswalk of the practice expense inputs for this code from CPT code 93272, Patient demand single or multiple event recording with presymptom memory loop, per 30 day period of time; physician review and interpretation only. The commenters stated that this crosswalk does not accurately reflect all the practice expense inputs associated with the service, and recommended we crosswalk the inputs from CPT code 93271, Patient demand single or multiple event recording with presymptom memory loop, per 30 day period of time; monitoring, receipt of transmissions, and analysis.
Two organizations requested that we publish the RUC recommended values for these immunization codes, as well as the visual screening test and other services with RUC recommendations not reimbursed under Medicare, because other payors use the RVUs under the physician fee schedule.
We received the following comments on HCPCS codes established in the November 2, 1999 Final Rule:
One commenter indicated this service was undervalued and recommended inputs for this code. We continue to believe that the values assigned in last year's rule are appropriate, and we are retaining these values.
We received comments expressing concerns about the new code, G0167, Hyperbaric Oxygen Treatment Not Requiring Physician Attendance, per Treatment. The commenter requested that we clarify the intended use of this code. Our contractors have discretion to cover hyperbaric oxygen with or without physician supervision. Our coverage staff is currently reviewing hyperbaric oxygen therapy services policies generally, including the appropriate levels of physician supervision. The progress of this review can be tracked on our web site, http:
One specialty was concerned that the services described by this code were not coded as a simple repair as recommended by the CPT panel. The commenter suggested that the cost of the supply, Dermabond, could be reimbursed separately. Another commenter was concerned about the 10-day global period assigned to this code.
The work and practice expense values for this code were based upon an evaluation and management visit, CPT code 99212, except that the price of Dermabond was added as a practice expense. We assigned these values because many of these wounds could have been closed with Steri-strips, a service that is also coded with evaluation and management, rather than a simple repair. We will be analyzing the use of HCPCS code G0168 to learn more about the use of this product, and will consider revaluing it after that analysis is completed.
Although we believe that the typical service involving the use of Dermabond as the only closure will typically not involve a visit for suture removal, we concede that, if another visit were needed for a complication, we should allow another evaluation and management visit. For this reason, we will change the global period to 0 days.
For 2000, we created G0169 to describe a service that involved removal of devitalized tissue. For 2001, CPT adopted a code 97601 that is sufficiently similar to the services described by G0169 that we will ask providers to utilize that code for selective removal of devitalized tissue, and we will eliminate G0169. We crosswalked the values for G0169 to CPT Code 97601. This code will continue to have no global period. Establishment of Interim Work Relative Value Units for New and Revised Physician's Current Procedural Terminology Codes and New HCFA Common Procedure Coding System Codes for 2001 (Includes Table titled American Medical Association Specialty Relative Value Update Committee and Health Care Professionals Advisory Committee Recommendations and HCFA's Decisions for New and Revised 2001 CPT Codes)
One aspect of establishing RVUs for 2001 was related to the assignment of interim work RVUs for all new and revised CPT codes. As described in our November 25, 1992 notice in the 1993 fee schedule (57 FR 55983) and in section III.B. of our November 22, 1996 final rule (61 FR 59505 through 59506) we established a process, based on recommendations received from the AMA's RUC, for establishing interim work RVUs for new and revised codes.
This year we received work RVU recommendations for approximately 131 new and revised CPT codes from the RUC. Our staff and medical officers reviewed the RUC recommendations by comparing them to our reference set or to other comparable services for which work RVUs had been previously established, or to both of these criteria. We also considered the relationships among the new and revised codes for which we received RUC recommendations. We agreed with the majority of these relationships reflected in the RUC values. In some instances, when we agreed with the relationships, we revised the work RVUs to achieve work neutrality within families of codes, that is, the work RVUs have been adjusted so that the sum of the new or revised work RVUs (weighted by projected frequency of use) for a family will be the same as the sum of the current work RVUs (weighted by projected frequency of use). For approximately 91 percent of the RUC recommendations, proposed work RVUs were accepted, and for approximately 9 percent, we disagreed with the RUC recommendation. In a majority of instances, we agreed with the relativity proposed by the RUC, but needed to decrease work RVUs to retain budget neutrality.
There were also 38 CPT codes for which we did not receive a RUC recommendation. After a review of these CPT codes by our staff and medical officers, we established interim work RVUs for the majority of these services. For those services for which we could not arrive at interim work RVUs, we have assigned a carrier priced status until such time as the RUC provides work RVU recommendations.
We received 5 recommendations from the Health Care Professionals Advisory Committee (HCPAC). Two of the HCPAC recommendations were reduced while 3 of the recommendations were for services that we do not cover. Additionally, there were 2 services for which we did not receive recommendations from the HCPAC.
The table titled AMA RUC and HCPAC Recommendations and HCFA Decisions for New and Revised 2001 CPT Codes lists the new or revised CPT codes, and their associated work RVUs, that will be interim in 2001. This table includes the following information:
• A “#” identifies a new code for 2001.
• CPT code. This is the CPT code for a service.
• Modifier. A “26” in this column indicates that the work RVUs are for the professional component of the code.
• Description. This is an abbreviated version of the narrative description of the code.
• RUC recommendations. This column identifies the work RVUs recommended by the RUC.
• HCPAC recommendations. This column identifies the work RVUs recommended by the HCPAC.
• HCFA decision. This column indicates whether we agreed with the RUC recommendation (“agree”) or we disagreed with the RUC recommendation (“disagree”). Codes for which we did not accept the RUC recommendation are discussed in greater detail following this table. An “(a)” indicates that no RUC recommendation was provided. A discussion follows the table.
• HCFA Work RVUs. This column contains the RVUs for physician work based on our reviews of the RUC recommendations.
• 2001 Work RVUs. This column establishes the 2001 work RVUs for physician work.
The following is a summary of our rationale for not accepting particular RUC work RVU recommendations. It is arranged by type of service in CPT order. Additionally, we also discuss those CPT codes for which we received no RUC recommendations for physician work RVUs. This summary refers only to work RVUs.
Temporary HCPCS Codes G0170 and G0171, established in the November 1999 final rule, will be deleted. The two aforementioned deleted codes have been replaced by CPT codes 15342 and 15343. The RUC recommended that the work RVUs for CPT codes 15342 and 15343 be crosswalked from deleted HCPCS codes G0170 and G0171, which are currently being used to report bioengineered tissue grafts. The work RVUs for CPT codes 15342 and 15343 are crosswalked from G0170 and G0171, with the following modification. Currently, HCPCS code G0170 includes the work of CPT codes 15000 and 15350. The CPT instructions for CPT code 15342 state that it can be billed with CPT code 15000. For this reason the crosswalk for CPT code 15342 would be to 25 percent of the work RVU of CPT code 15350, or 1.00 work RVUs. This percentage was chosen because CPT code 15342 is for graft sizes of up to 25 square centimeters, and CPT code 15350 is for graft sizes up to 100 square centimeters. Similarly, the RUC recommended work RVUs for CPT code 15343 are adjusted to 25 percent of 15351, or 0.25 work RVUs. Additionally, we note that some commenters requested the global period for HCPCS code G0170 be lowered from ten to seven days. This was not done, because we use only three global period lengths zero, ten, and ninety days. Clearly the ten-day global period is the most appropriate and consistent with the recommendation of the commenters. This decision will be applied to CPT code 15342. CPT code 15343 is an add-on service that does not have a global period.
The RUC recommended a work RVU of 4.31 for CPT code 22522. The RUC arrived at this value based upon the fact that the work involved with CPT code 22522 was 50 percent of the total work of CPT codes 22520 and 22521. The RUC failed to remove the pre-service
The RUC did not supply us with a recommendation for CPT code 43752. We believe that this service is bundled into evaluation and management services. For this reason, there is no work RVU associated with this service.
The RUC recommended carrier pricing for these services. These services are not covered transplant services under Medicare. For this reason, there are no work RVUs associated with these services.
The RUC determined a work increment, from the applicable endoscopic base code, for transendoscopic stent placement including predilation of 1.96 RVUs. We agree with this increment. For the endoscopic stent placement CPT codes for which we did not receive a work recommendation from the RUC, we applied this increment to the applicable endoscopic basecode. Because endoscopic stent placement is being currently billed under existing endoscopic CPT codes, we needed to make a work neutrality adjustment to each family of codes in which a stent placement code had been created.
The RUC did not supply a work RVU recommendation for CPT code 57023. We did receive a work RVU recommendation for similar CPT code 57022. Until such time as we receive more information allowing us to appropriately value CPT code 57023, we will adopt the RUC recommended work RVU for CPT code 57022. For these reasons, we have assigned a work RVU of 2.56 to CPT code 57023.
The RUC did not supply work RVU recommendations for CPT codes 63040 through 63044. CPT codes 63040 and 63042 were revised to account for single interspace cervical and lumbar laminotomy, respectively. CPT codes 63043 and 63044 were added to account for each additional cervical and lumbar interspace laminotomy(s). We will bundle CPT code 63043 into CPT code 63040 and CPT code 63044 into CPT code 63042, and retain the existing work RVUs for CPT codes 63040 and 63042. We will re-evaluate these services when the RUC supplies work RVU recommendations.
The RUC did not supply work RVU recommendations for CPT code 67221. Subsequent to the publication of the July 2000 proposed rule in which we proposed establishing a new HCPCS code for this service, the CPT editorial panel approved CPT code 67221 for ocular photodynamic therapy. We have deleted our proposed temporary code and established values for CPT code 67221. Based on comments received from specialty societies and a comparison of the work values for this procedure with CPT code 67210, Destruction of localized lesion of retina, we have assigned 4.01 work RVUs to this service. The intraservice times and work intensities for CPT codes 67210 and 67221 are comparable. Therefore, adjusting for the work value of the postoperative visits (because 67210 has a 90-day global period) and the 20 percent retreatment rate included in CPT code 67210, and then applying the intraservice work intensity of 67210 to 67221, yields an appropriate work value for 67221. For a further discussion of this issue, see section II.G.
CPT created a series of new codes for 2001 describing computed tomographic (CT) angiography for different parts of the body. The RUC submitted work recommendations of 1.75 RVUs for CPT codes 70496 and 70498, with which we agree. The RUC did not submit work recommendations for the other CT angiography codes. The RUC compared the head and neck CPT angiography codes to MRI angiography and CT scans without contrast followed by contrast of the same region in determining the values for these services. However, upon our review, we determined that the work RVUs recommended by the RUC were more comparable to the work RVUs associated with CPT code 75671, Angiography, carotid, cerebral, bilateral, radiological interpretation and supervision, and CPT code 75680, Angiography, carotid, cervical, bilateral, radiological interpretation and supervision. Both CPT code 75671 and CPT code 75680 have work RVUs of 1.66. The proportional work RVU increase from the angiography supervision and interpretation code to the CT angiography code was 1.05. Therefore, in determining the work RVUs of the other CT angiography codes, we—(1) compared each code to its most comparable angiographic radiological supervision and interpretation code, and (2) applied a proportionate work increase of 1.05 to the CT angiography code. The CPT codes to which we compared the CT angiography codes were 75605, 75736, 75710, 75625, and 75630. Note that CT angiography of the extremities has been valued as a unilateral service. However, CPT code 75635 is valued for bilateral lower extremity run.
CPT 2000 has a single code to describe MRI of each region of the body except for MRI of the brain, where three separate codes exist that describe MRI of the brain without contrast, with contrast, and without contrast followed by contrast. For CPT 2001 the single MRI code for each area of the body will be broken out into three separate CPT codes describing MRI for that body area without contrast, with contrast, and without contrast followed by contrast.
The only codes for which we received work RVU recommendations from the RUC were CPT 70540 (MRI orbit/face/neck, w/o contrast), 70542 (MRI orbit/face/neck, w/contrast), and 70543 (MRI orbit/face/neck, w/out then w/contrast). The recommended work RVUs were 1.48, 1.78, and 2.36 respectively. The services that will be described under these three CPT codes are currently being coded under a single CPT code, 70540 (current descriptor is Magnetic Resonance (
We did not receive work recommendations or utilization data for any of the other new MRI codes. In each case, a single MRI code describing MRI of a body area was broken out into three codes describing MRI of that body area without contrast, with contrast, and without contrast followed by contrast. In order to assign appropriate work values for these codes, we followed the following procedure for MRI of each body area—(1) we assigned a work RVU to MRI without contrast, MRI with contrast, and MRI without contrast followed by contrast that maintained the same relationship as the work RVUs the RUC assigned to the three codes for MRI of the orbit, face, and neck, (2) we determined the total work RVUs for the body area by utilization of the current MRI code for that body area, (3) we applied the relative utilization of the brain MRI codes to the new MRI codes for each body area, and (4) we adjusted the work RVUs assigned in step 1 for MRI of each body area to make them work neutral to the work RVUs determined from step 2.
The RUC recommended a work RVU of 1.05 for CPT code 76818 and 0.77 for CPT code 76819. Although we agree with the relativity established by the RUC, the codes needed to be adjusted for budget neutrality. For this reason, we have assigned 0.86 work RVUs to CPT code 76818 and 0.63 work RVUs to CPT code 76819.
The RUC recommended a work RVU of 0.51 for CPT code 97532 and 0.48 for CPT code 97533. These two new services were created to replace the deleted CPT code 97770. We believe the work associated with these two new services is analogous to deleted CPT code 97770. For this reason, we have assigned the same work RVU (0.44) that was assigned to deleted CPT code 97770 to both CPT code 97532 and CPT code 97533.
The HCPAC did not supply a work RVU recommendation for either CPT code 97601 or CPT code 97602. We had established temporary HCPCS code G0169 for the work described in new CPT code 97601. For this reason, we have assigned the same work RVU (0.50) to CPT code 97601 that was assigned to now-deleted HCPCS code G0169. We consider CPT code 97602 to be bundled into CPT code 97601 and therefore will not establish work RVUs for this service.
The HCPAC supplied work RVU recommendations of: 0.45 for CPT code 97802, 0.37 for CPT code 97803, and 0.25 for CPT code 97804. These services do not fall under any enumerated category of Medicare services, and thus these services are not covered by Medicare. Additionally, these services are not physician services and, therefore, would not be assigned physician work RVUs. Finally, the American Diabetic Association is unhappy with the descriptors CPT has assigned to CPT codes 97802 through 97804, and is in the process of submitting a request to CPT for a revision to the descriptors for these services. For these reasons, we have decided not to assign work RVUs to these services.
Establishment of Interim Practice Expense Relative Value Units for New and Revised Physician's Current Procedural Terminology (CPT) Codes and New HCFA Common Procedure Coding System Codes for 2001.
We have developed a process for establishing interim practice expense RVUs (PERVUs) for new and revised codes that is similar to that used for work RVUs. Under this process, the RUC recommends the practice expense direct inputs, that is, the staff time, supplies and equipment associated with each new code. We then review the recommendations in a manner similar to our evaluation of the recommended work RVUs.
The RUC recommendations on the practice expense inputs for the new and revised 2001 codes were submitted to us as interim recommendations. We, therefore, consider that these recommendations are still subject to further refinement by the PEAC, or by us, if it is determined that such future review is needed. We do have concerns regarding some of the recommended inputs, particularly clinical staff times, for certain services, and we may revisit these inputs in light of future decisions of the PEAC regarding supply and equipment packages and standardized approaches to pre- and post-service clinical staff times.
We have accepted, at least in the interim, almost all of the practice expense recommendations submitted by the RUC for the codes listed in the following table titled “AMA RUC and HCPAC Recommendations and HCFA Decisions for New and Revised 2001 CPT Codes.” We made the following minor changes to the inputs where relevant:
• We rounded all clinical staff time to the nearest minute.
• For consistency with the CPEP revisions contained in the November 1999 final rule, we deleted separately billable fluid and contrast material, and the skin marking pen, disinfectant and biohazard bag, because these items cannot easily be allocated to individual services.
• The RUC assigned the E/M visit supply package, which includes a tongue depressor, drape sheet, and disposable otoscope speculum, as well as the E/M equipment package, which includes an otoscope-ophthalmoscope, to several vascular, spine and other post-surgical visits. We deleted the otoscope-ophthalmoscope, because it is not typically used for such post-surgical visits and, instead of the E/M visit supply package, substituted the multi-specialty minimum visit supply package that includes: exam table paper, patient gown, pillow case, nonsterile gloves, and thermometer probe cover. We also added a patient education book.
• For those codes refined before the multi-specialty minimum visit supply package was adopted, we substituted this package for the list of individual items when they matched exactly. In the same manner, we substituted the ophthalmology visit supply package as appropriate.
• For CPT 11980, Subcutaneous hormone pellet implantation, we deleted the disinfectant solution because it is already included in the OB-GYN visit supply package assigned to this code.
• The RUC only priced CPT 36870, Thrombectomy, percutaneous, arteriovenous fistula, in the office setting. We added inputs for the facility setting, using the clinical staff time for coordinating pre-surgery services and providing pre-service education, as well as the clinical staff time for the one post-surgical visit. We also added the supply and equipment inputs for the post-surgical visit. For the non-facility setting, we added a multi-specialty
• The RUC Health Care Professional Advisory Committee submitted a recommendation on the inputs for CPT 97533, Sensory integrative techniques. The inputs included a long list of specific equipment that we have combined into one package called “sensory integration equipment.”
• The RUC deferred making a recommendation on the practice expense inputs for CPT 43752, Naso- or oro-gastric tube placement. We have assumed that this service is performed only in the facility setting, and, as a 0-day global, has no direct inputs.
For the following CPT codes we did not receive practice expense recommendations. Therefore, we are providing practice expense inputs through crosswalking to an existing code as indicated below:
For the 2001 physician fee schedule, we are establishing or revising several alpha-numeric HCPCS codes for reporting certain services that are not clearly described by existing CPT codes. This is in addition to the HCPCS codes for ocular photodynamic therapy, certification/recertification for home health services and care plan oversight previously discussed. We view these codes as temporary since we will be referring them to the CPT Editorial Panel for possible inclusion in future editions of CPT. Additionally, included in this section are some clarifications of proper use of some new or revised codes.
We are proposing the following new codes to describe the evaluation of swallowing function. These codes will replace the more general CPT 92525, Evaluation of swallowing and oral function for feeding, which represents a combination of these separate examinations. Our contractors requested the more precise coding to improve claims review for evaluation of dysphagia. The new codes are described as follows:
G0193 Endoscopy study of swallowing function, often referred to as fiberoptic endoscopic evaluation of swallowing (FEES).
G0194 Sensory testing during endoscoping study of swallowing. This service, often referred to as fiberoptic endoscopic evaluation of swallowing with testing, will be coded as an add-on code to G0193.
The creation of these two codes does not imply coverage. Coverage of G0193 and G0194 remains at the discretion of the contractor processing the Medicare claim. These codes will be priced by contractors.
Two additional codes are also used to describe swallowing evaluations:
G0195 Clinical evaluation of swallowing function. This service describes the clinical examination and evaluation of the patient, typically by a speech and language pathologist.
G0196 Evaluation of swallowing involving swallowing of radio-opaque materials. This code involves the participation and interpretation of results from the dynamic observation of the patient swallowing materials of various consistencies. It is observed fluoroscopically and typically recorded on video. This evaluation involves using the information to assess the patient's swallowing function and developing a treatment plan for the patient.
Both codes G0195 and G0196 will be assigned the same work and malpractice RVUs as CPT 92525. For practice expense, we have crosswalked the inputs from 92525 for these codes. CPT 92525 will no longer be an active code for Medicare.
Note that CPT 31575 (laryngoscopy, flexible fiberoptic, diagnostic) and CPT 31579 (laryngoscopy, flexible or rigid fiberoptic, with stroboscopy) should not be used for evaluations of swallowing.
Because of the change in coverage policy on speech-generating devices, effective January 1, 2001, we needed codes that more specifically describe the services needed to evaluate and train patients to use these devices. As a result, we will be replacing CPT 92597, Evaluation for use and/or fitting of voice prosthetic or augmentative/alternative
G0197 Evaluation of patient for prescription of speech-generating devices. This code describes the services to evaluate a patient to specify the speech-generating device recommended to meet the patient's needs and capacity for use. This code involves face-to-face involvement of the practitioner (typically a speech and language pathologist experienced in the use of these devices) with the patient. The work and malpractice RVUs for this new code will be cross-walked to the ones used for CPT code 92597, the code it replaces. For practice expense, we have crosswalked the inputs to CPT code 92527 for these codes.
G0198 Patient adaptation and training for use of speech-generating devices. This code describes the services delivered to the patient to adapt the device to the patient, and train him or her in its use. This code involves face-to-face involvement of the practitioner (typically a speech and language pathologist experienced in the use of these devices) with the patient. The work and malpractice RVUs, as well as the practice expense inputs for this new code, will be crosswalked to the ones used for CPT code 92598, the code it replaces.
G0199 Re-evaluation of patient using speech-generating devices. This code describes the services to re-evaluate a patient who has previously been evaluated for a speech-generating device, and either is currently using a device or did not have a device recommended. This code involves face-to-face involvement of the practitioner (typically a speech and language pathologist experienced in the use of these devices) with the patient. The work RVUs for this new code will be 75 percent of the value for CPT code 92597, reflecting that it is likely to be less intensive than the initial evaluation. The malpractice and practice expense inputs are also crosswalked to CPT code 92957.
G0200 Evaluation of patient for prescription of voice prosthetic. This code describes the services to evaluate a patient for the use of a voice prosthetic device. This code involves face-to-face involvement of the practitioner (typically a speech and language pathologist experienced in the use of these devices) with the patient. The work and malpractice RVUs for this new code will be crosswalked to the ones used for CPT code 92597, the code it replaces. We will also crosswalk practice expense inputs to CPT code 92957.
G0201 Modification or training in use of voice prosthetic. This code involves the modification or training of a patient in the use of a voice prosthetic. This code involves face-to-face involvement of the practitioner (typically a speech and language pathologist experienced in the use of these devices) with the patient. The work and malpractice RVUs, as well as the practice expense inputs for this new code, will be crosswalked to the ones used for CPT code 92598, the code it replaces. The RUC recommendations, as well as the revised CPEP data for all codes, can be found on our homepage. See the
The 2001 physician fee schedule conversion factor is $38.2581. The separate 2001 national average anesthesia conversion factor is $17.26.
The 2001 physician fee schedule update is 5.1 percent. However, miscellaneous adjustments will result in an increase in the conversion factor from 2000 to 2001 of 4.5 percent. The specific calculations to determine the physician fee schedule update and conversion factor for physicians' services for calendar year 2001 are explained below.
The conversion factor is affected by section 1848(c)(2)(B)(ii)(II) of the Act, which requires that changes to the relative value units of the Medicare physician fee schedule not cause expenditures to increase or decrease by more than $20 million from the amount of expenditures that would have been made if such adjustments had not been made. We implement this requirement through a uniform budget-neutrality adjustment to the conversion factor. There are two changes that will require us to make an adjustment to the conversion factor to meet the budget neutrality requirements in section 1848(c)(2)(B)(ii)(II). We are making a 0.3 percent reduction (0.997) in the conversion factor to account for separate payment for certification and recertification of a plan of care for home health services. We are also making a 0.14 percent (0.9986) reduction in the conversion factor to account for an anticipated increase in the volume and intensity of services.
After considering this factor, as well as the percent change in the MEI, the update adjustment factor, and statutory adjustment described below, the 2001 conversion factor is calculated as follows:
Under section 1848(d)(3) of the Act, the update is equal to the product of the MEI and the update adjustment factor. For 2001, the MEI is equal to 2.1 percent (1.021). A more detailed description of the MEI and its calculation follows. The update adjustment factor is equal to 3.0 percent (1.030). Thus, the product of the MEI (1.021) and the update adjustment factor (1.030) equal the 2001 update (1.05163). Section 1848(d)(4)(F) of the Act provides for an additional adjustment to the update for 2001 of −0.2 percent (0.998). Thus, taking into account the 2001 update, the 2001 legislative adjustment, the 2001 volume and intensity adjustment, and the adjustment for certification and recertification of a plan of care for home health services, the conversion factor for 2001 is determined as follows: $36.6137 × 1.05163 × 0.998 × 0.9986 × 0.997 = $38.2581.
The MEI and the update adjustment factor are described below.
The MEI measures the weighted-average annual price change for various inputs needed to produce physicians' services. The MEI is a fixed-weight input price index, with an adjustment for the change in economy-wide labor productivity. This index, which has 1996 base weights, is comprised of two broad categories: Physician's own time and physician's practice expense.
The physician's own time component represents the net income portion of business receipts and primarily reflects the input of the physician's own time into the production of physicians' services in physicians' offices. This category consists of two subcomponents—wages and salaries, and fringe benefits. These components are adjusted by the 10-year moving average annual percent change in output per man-hour for the nonfarm business sector to account for productivity growth in the general economy.
The physician's practice expense category represents the rate of price growth in nonphysician inputs to the production of services in physicians' offices. This category consists of wages and salaries and fringe benefits for nonphysician staff and other nonlabor inputs. Like physician's own time, the nonphysician staff categories are adjusted for productivity using the 10-year moving average annual percent change in output per man-hour for the nonfarm business sector. The physician's practice expense component also includes the following categories of nonlabor inputs—office expense, medical materials and supplies, professional liability insurance, medical equipment, professional car, and other expense. The table below presents a listing of the MEI cost categories with associated weights and percent changes for price proxies for the 2001 update. The calendar year 2001 MEI is 2.1 percent.
Under sections 1848(d)(3) and (d)(4) of the Act, the physician fee schedule update is equal to the product of the Medicare Economic Index and an “update adjustment factor.” The update adjustment factor represents an amount that is applied to the inflation update to reflect success or failure in meeting the expenditure target that the law refers to as “allowed expenditures.” Allowed expenditures are equal to actual expenditures in a base period updated each year by the sustainable growth rate. The sustainable growth rate is a percentage increase that is determined by a formula specified in section 1848(f) of the Act. The next section describes the SGR and its calculation in detail. The update adjustment factor is determined based on a comparison of actual and allowed expenditures. For years beginning with 1999, the BBA required that the update adjustment factor be determined under section 1848(d)(3) of the Act to equal—
(i) the difference between—(I) the sum of the allowed expenditures for physicians' services (as determined under subparagraph (C)) for the period beginning April 1, 1997, and ending on March 31 of the year involved, and (II) the amount of actual expenditures for physicians' services furnished during the period beginning April 1, 1997, and ending on March 31 of the preceding year; divided by—
(ii) the actual expenditures for physicians' services for the 12-month period ending on March 31 of the preceding year, increased by the sustainable growth rate under subsection (f) for the fiscal year which begins during such 12-month period.
Pub. L. No. 106-113, the Medicare, Medicaid and State Children's Health Insurance Program Balanced Budget Refinement Act of 1999 (BBRA) made changes to the methodology for determining the physician fee schedule update beginning in 2001. In particular, it established that the methodology in section 1848(d)(3) of the Act would only be used for determining the physician fee schedule update for 1999 and 2000. The BBRA established that the physician fee schedule update for 2001 and subsequent years would be determined under section 1848(d)(4) of the Act. While the general principle of adjusting the inflation update (the MEI) by the update adjustment factor continues, the BBRA made fundamental changes to the calculation of the update adjustment factor. In general, these changes do two things. First, the measurement of actual expenditures will occur on the basis of a calendar year rather than an April 1 to March 31 year. This essentially conforms the measurement of actual expenditures with other aspects of the SGR system that are also occurring on the basis of a calendar year as a result of BBRA amendments. As we explained in our April 10, 2000 SGR final notice (65 FR 19000), the BBRA essentially changed the SGR system from one that spanned 3 different time periods, ((1) measurement of actual expenditures on the basis of an April 1 to March 31 period; (2) calculation of the SGR rate of increase on a federal fiscal year basis; and (3) application of the update on a calendar year basis) to one that spans only one time period. (All three are on the basis of a calendar year). Second, it ensures that any deviation between cumulative actual expenditures and cumulative allowed expenditures will be corrected over several years rather than in a single year. This will result in less year-to-year volatility in the physician fee schedule update than would occur if adjustments to the update are made to bring expenditures in line with the target in one year.
Under section 1848(d)(4)(A) of the Act, the physician fee schedule update for a year is equal to the product of— (1) 1 plus the Secretary's estimate of the percentage increase in the MEI for the year, and (2) 1 plus the Secretary's estimate of the update adjustment factor for the year. Under section 1848(d)(4)(B) of the Act, the update adjustment factor for a year beginning with 2001 is equal to the sum of the following:
(i) Prior Year Adjustment Component. An amount determined by:
(I) Computing the difference (which may be positive or negative) between the amount of the allowed expenditures for physicians' services for the prior year (the year prior to the year for which the update is being determined) and the amount of the actual expenditures for such services for that year;
(II) Dividing that difference by the amount of the actual expenditures for such services for that year; and
(III) Multiplying that quotient by 0.75.
(ii) Cumulative Adjustment Component. An amount determined by:
(I) Computing the difference (which may be positive or negative) between the amount of the allowed expenditures for physicians' services from April 1, 1996 through the end of the prior year and the amount of the actual expenditures for such services during that period;
(II) Dividing that difference by actual expenditures for such services for the prior year as increased by the sustainable growth rate for the year for which the update adjustment factor is to be determined; and
(III) Multiplying that quotient by 0.33.
Thus, the CY 2001 update adjustment factor will be determined as the sum of the following:
(i) Prior Year Adjustment Component. This equals the difference between allowed expenditures in 2000 and our current estimate of actual expenditures for 2000. This difference is divided by our current estimate of actual expenditures for 2000 and the quotient is multiplied by 0.75. Our current estimate of allowed expenditures for CY 2000 is $56.6 billion. Our current estimate of actual expenditures for all of 2000 based on claims received through June 30 is $55.1 billion. Thus, the prior year adjustment component is equal to:
(ii) Cumulative Adjustment Component. This amount equals the difference between allowed expenditures for the period April 1, 1996 through December 31, 2000 ($244.4 billion) and actual expenditures for the same period ($240.6 billion) divided by the product of actual expenditures for the year 2000 ($55.1) increased by the SGR for 2001 (5.6 percent). This quotient is multiplied by 0.33. Thus, the cumulative adjustment component is equal to:
The prior year adjustment component and the cumulative adjustment component are added. Adding these figures together would make the update adjustment factor equal 0.042. However, section 1848(d)(4)(D) of the Act indicates that the update adjustment factor determined under section 1848(d)(4)(B) of the Act for a year may not be less than −0.07 or greater than 0.03. Since 0.042 exceeds 0.03, we are limiting the update adjustment factor consistent with section 1848(d)(4)(D) of the Act to 0.03. Section 1848(d)(4)(A)(ii) of the Act indicates that 1 should be added to the update adjustment factor determined under section 1848(d)(4)(B) of the Act. Thus, adding 1 to 0.03 makes the update adjustment factor equal 1.030.
(As indicated in the SGR discussion below, allowed expenditures through the end of CY 2000 will be revised one more time, no later than November 1, 2001. We will also be revising the measurement of actual expenditures for CY 2000 based on claims received through June 30, 2001. These revised figures will be determined no later than November 1, 2001. The SGR for 2001 will also be revised two more times. Any differences that result in the update adjustment factor for 2001 from revision of estimates will be reflected in update adjustment factor determined for 2002.)
Section 1848(f) of the Social Security Act (the Act), as amended by section 4503 of the Balanced Budget Act of 1997 (BBA) (Pub. L. 105-33), enacted on August 5, 1997, replaced the Medicare Volume Performance Standard (MVPS) with a Sustainable Growth Rate (SGR). Section 1848(f)(2) of the Act specifies the formula for establishing yearly SGR targets for physicians' services under Medicare. The use of SGR targets is intended to control the actual growth in aggregate Medicare expenditures for physicians' services.
The SGR targets are not limits on expenditures. Payments for services are not withheld if the SGR target is exceeded by actual expenditures. Rather, the appropriate fee schedule
As with the MVPS, the statute specifies a formula to calculate the SGR based on our estimate of the change in each of four factors. The four factors for calculating the SGR are as follows:
(1) The estimated change in fees for physicians' services.
(2) The estimated change in the average number of Medicare fee-for-service beneficiaries.
(3) The estimated projected growth in real gross domestic product (GDP) per capita.
(4) The estimated change in expenditures due to changes in law or regulations.
Section 211 of the BBRA amended sections 1848(d) and 1848(f) of the Act with respect to the physician fee schedule update and the SGR. Section 211(b) of the BBRA maintains the formula for calculating the SGR, but amends section 1848(f)(2) of the Act to apply the SGR on a calendar year (CY) basis beginning with 2000 while maintaining the SGR on a fiscal year (FY) basis for FY 1998 through FY 2000. Specifically, section 1848(f)(2) of the Act, as amended by section 211(b) of the BBRA, states that_“* * * [t]he sustainable growth rate for all physicians' services for a fiscal year (beginning with fiscal 1998 and ending with fiscal year 2000) and a year beginning with 2000 shall be equal to the product of:
(1) 1 plus the Secretary's estimate of the weighted average percentage increase (divided by 100) in the fees for all physicians' services in the applicable period involved,
(2) 1 plus the Secretary's estimate of the percentage change (divided by 100) in the average number of individuals enrolled under this part (other than Medicare+Choice plan enrollees) from the previous applicable period to the applicable period involved,
(3) 1 plus the Secretary's estimate of the projected percentage growth in real gross domestic product per capita (divided by 100) from the previous applicable period to the applicable period involved; and
(4) 1 plus the Secretary's estimate of the percentage change (divided by 100) in expenditures for all physicians' services in the applicable period (compared with the previous applicable period) which will result from changes in law and regulations, determined without taking into account estimated changes in expenditures resulting from the update adjustment factor determined under section 1834 (d)(3)(B) or (d)(4)(B) of the Act, as the case may be, minus 1 and multiplied by 100.”
Under section 1848(f)(4)(C) of the Act, as added by section 211(b)(3) of the BBRA, the term “applicable period” means—(1) a FY, in the case of FY 1998, FY 1999 and FY 2000, and (2) a CY with respect to a year beginning with 2000.
To make the transition from a FY SGR to a CY SGR in 1999 using the FY 2000 SGR, sections 211(b)(2) and (b)(3) of the BBRA require us to calculate SGRs for both FY and CY 2000. Section 1848(d)(4)(C) of the Act, as modified by section 211(a)(1)(B) of the BBRA, required us to determine the allowed expenditures for both the 9-month period beginning April 1, 1999 and for CY 1999. The SGR for CY 2000 is then applied to allowed expenditures for CY 1999.
As stated in the April 10 final notice (65 FR 19002), the BBRA requires the estimate of the FY 2000 and CY 2000 SGR to be revised based on more recent data, but, as explained below, the BBRA does not provide for revision of either the FY 1998 or the FY 1999 SGR. This means that, for the transition to a calendar year SGR system, allowed expenditures for the period April 1, 1999 through December 31, 1999 (determined by applying the FY 2000 SGR to allowed expenditures for the 12-month period ending March 31, 1999) are subject to change based on revision of the FY 2000 SGR; allowed expenditures for the period January 1, 1999 through March 31, 1999 (determined using the FY 1999 SGR) are not subject to revision.
In general, the BBRA requires us to publish SGRs for three different time periods, no later than November 1 of each year, using the best data available as of September 1 of each year. Under section 1848(f)(3)(C)(i) of the Act, as added by section 211(b)(5) of the BBRA, the SGR is estimated and subsequently revised twice (beginning with the FY and CY 2000 SGRs) based on later data. Under section 1848(f)(3)(C)(ii) of the Act, there are no further revisions to the SGR once it has been estimated and subsequently revised in each of the 2 years following the initial estimate.
The requirement of revisions to the SGR based on later data means that we will estimate and publish an SGR for the upcoming year, the contemporaneous year, and the preceding year by not later than November 1 of each year. For example, by not later than November 1, 2002, we will publish an estimate of the SGR for CY 2003, a revision of the CY 2002 SGR estimated in the previous year, and a revision of the CY 2001 SGR first estimated two years earlier and first revised in the previous year. Under section 1848(f)(3)(C)(ii) of the Act, this would be the final revision to the CY 2001 SGR.
Sections 1848(f)(3)(A) and (f)(3)(B) of the Act, as added by section 211(b)(5) of the BBRA, specify special rules with respect to the SGR and the CY 2001 and CY 2002 updates. Section 1848(f)(3)(A) of the Act requires us, not later than November 1, 2000, to revise the SGRs for FY 2000 and CY 2000 and to establish the SGR for CY 2001, based on the best data available, as of September 1, 2000. Section 1848(f)(3)(B) of the Act requires us, by not later than November 1, 2001, to revise the SGRs for FY 2000 and CYs 2000 and 2001 and to establish the SGR for CY 2002, based on the best data available as of September 1, 2001. In accordance with section 1848(f)(3)(C)(ii) of the Act, there will be no further revisions to the FY 2000 and CY 2000 SGRs after their revision in the 2001 notice.
Section 1848(f)(4)(A) of the Act defines the scope of physicians' services covered by the SGR. The BBRA made no changes to this definition that was also used for the MVPS. For this reason, we are continuing to use the same definition of physicians' services for the SGR in this notice as we did in prior SGR notices and for the MVPS published in the
We are implementing section 211(b)(1)(A) of the BBRA that requires us to publish in the
In general, the update for a year is based on the Medicare Economic Index (MEI) as adjusted, within bounds, by the amount of actual expenditures for physicians' services compared to allowed (that is, growth target) expenditures. A key difference between the MVPS and the SGR is that the comparison of actual and allowed expenditures is made on a cumulative basis under the SGR, while it was made on an annual basis under the MVPS. The “update adjustment factor” in section 1848(d)(4)(B) of the Act is an
Section 1848(d)(3)(C) of the Act, as modified by the BBA, defines allowed expenditures for the 12-month period ending March 31, 1997 as equal to actual expenditures for physicians' services during that period (that is, April 1, 1996 through March 31, 1997), as we have estimated. Section 1848(d)(3)(C) of the Act defines allowed expenditures for subsequent 12-month periods to be equal to allowed expenditures for physicians' services for the previous year increased by the SGR for the FY which begins during the 12-month period. For example, allowed expenditures for the 12-month period April 1, 1997 through March 31, 1998 are equal to allowed expenditures for the 12-months ending March 31, 1997, increased by the SGR for FY 1998. As explained above, BBRA subsequently provided for a transition to a calendar year SGR system in 1999 with allowed expenditures in 2000 equal to 1999 allowed expenditures increased by the 2000 SGR. Allowed expenditures for each subsequent year will equal expenditures from the prior year updated by the SGR.
The following table shows annual and cumulative allowed expenditures for physicians' services from April 1, 1996 through December 31, 2001.
Allowed expenditures for the first quarter of 1999 are based on the FY 1999 SGR and allowed expenditures for the last three quarters of 1999 are based on the FY 2000 SGR.
In the above table, for the period April 1996 through March 1997, annual allowed expenditures are equal to actual expenditures for the period. Annual allowed expenditures for each subsequent year are equal to the figure from the prior April 1 through March 31 12-month period (shown in the annual allowed expenditure column) multiplied by the SGR figure one row down in the right hand column. For example, allowed expenditures from April 1997 through March 1998 are equal to $48.9 multiplied by 1.015. Cumulative allowed expenditures in a year are equal to the sum of the annual allowed expenditures figure in the same row and annual allowed expenditures for all prior years. The transition to the calendar SGR occurs in 1999. Our current estimates of the FY 2000 SGR of 7.9 percent (2.1 percent for factor 1, 0.8 percent for factor 2, 4.5 percent for factor 3 and 0.3 percent for factor 4), the CY 2000 SGR of 8.1 percent (2.1 percent for factor 1, 1.0 percent for factor 2, 4.3 percent for factor 3, and 0.5 percent for factor 4) and the CY 2001 SGR (1.9 percent for factor 1, 0.9 percent for factor 2, 2.7 percent for factor 3 and 0.0 percent for factor 4) are described in more detail below. All estimates are based on the best data available to the Secretary as of September 1.
Allowed expenditures for the April 1, 1999 through the December 31, 1999 period are based on the FY 2000 SGR. As previously discussed, section 1848(f)(3) of the Act requires two revisions to the FY 2000 SGR. The first revision must be made not later than November 1, 2000 based on the best data available as of September 1, 2000; the second revision must be made not later than November 1, 2001, based on the best data available as of September 1, 2001. The allowed expenditures figure in the above table for the April 1, 1999 through the December 31, 1999 period reflects the revisions of the FY 2000 SGR contained in this notice. Similarly, the allowed expenditure figure for 2000 reflects our current estimate of the SGR for 2000. Both figures will be revised for the final time not later than November 1, 2001.
As we explained in our April 10, 2000 SGR notice (65 FR 19002), section 1848(d)(4)(C)(ii)(II) of the Act, as added by section 211(a)(1)(B) of the BBRA, specifies that allowed expenditures for the year of 1999 must be our estimate of the amount of the allowed expenditures that would be permitted under section 1848(d)(3)(C) of the Act for that year. We are, therefore, calculating allowed expenditures for CY 1999 as the sum of allowed expenditures for—(1) The January 1, 1999 through March 31, 1999 period; and (2) allowed expenditures for the April 1, 1999 through December 31, 1999 period.
Annual allowed expenditures for the period April 1, 1998 through March 31, 1999 are $49.4 billion. Our actuarial estimate of allowed expenditures for the 3-month period January 1, 1999 through March 31, 1999 is $12.5 billion that was determined by updating quarterly allowed expenditures included in the January 1, 1997 through March 31, 1997 period by the SGRs for FY 1998, FY 1999 and FY 2000. Adding this figure to the $39.9 billion figure for April 1, 1999 through December 31, 1999 equals allowed expenditures for 1999 of $52.4 billion. (Due to rounding, the figures may not add precisely to the total for 2000.)
Allowed expenditures for the period April 1, 1998 through March 30, 1999 are equal to allowed expenditures for the previous 12-month period increased by the FY 1999 SGR. As discussed in the April 10, 2000 SGR final notice (65 FR 19001), because there is no provision in the Act for revising the FY 1999 SGR or, consequently, the allowed expenditures for the April 1, 1998 through March 31, 1999 period, we are not revising the January 1, 1999 through March 31, 1999 portion of allowed expenditures included in the 1999 allowed expenditures. Thus, allowed expenditures for the January 1, 1999 to March 31, 1999 period are the same as those included in our April 10, 2000 final notice (65 FR 19002). However, as indicated above, revisions to the FY 2000 SGR contained in this notice result in an increase in our earlier estimates of allowed expenditures for April 1, 1999 through December 31, 1999 and, hence, allowed expenditures for 1999.
According to sections 1848(f)(2)(A) through (f)(2)(D) of the Act, as amended by section 211(b) of the BBRA, we have determined the preliminary estimate of the CY 2001 SGR to be 5.6 percent. Our determination is based on estimates of the following four statutory factors as indicated in the table below:
According to sections 1848(f)(2)(A) through (f)(2)(D) of the Act, as amended by section 211(b) of the BBRA, our current estimate of the CY 2000 SGR is 8.1 percent. This compares to an estimate of 5.8 percent included in our April 10, 2000 notice (65 FR 19003). The table below shows our April 10 and current estimates of the four statutory factors that determine the CY 2000 SGR:
A more detailed explanation of each figure is provided below.
According to sections 1848(f)(2)(A) through (f)(2)(D) of the Act, as amended by section 211(b) of the BBRA, our current estimate of the FY 2000 SGR is 7.9 percent. This is in comparison to an estimate of 2.1 percent included in our October 1, 1999 notice (64 FR 53394). At the time of the April 10, 2000 final (SGR) notice, we estimated the SGR for FY 2000 would be 5.7 percent. The table below shows our October 1, 1999 and current estimates of the four statutory factors that determine the FY 2000 SGR:
A more detailed explanation of each figure is provided below.
A more detailed discussion of our preliminary estimates of the four elements of the 2001 SGR follows.
This factor was calculated as a weighted average of the CY 2001 fee increases that apply for the different types of services included in the definition of physicians' services for the SGR.
Physicians' services represent approximately 89 percent of allowed charges for physicians' services under the SGR and are updated by the Medicare Economic Index (MEI). Our current estimate of the MEI for 2001 is 2.1 percent. Diagnostic laboratory tests represent approximately 11 percent of the Medicare allowed charges for physicians' services under the SGR. The BBA provided for a 0.0 percent update for CY 2001 for laboratory services. The table below shows both the physicians' and laboratory service updates that were used to determine the percentage increase in physicians' fees for CY 2001.
After taking into account the elements described in the table, we estimate that the weighted-average increase in fees for CY 2001 for physicians' services under the SGR (before applying any legislative adjustments) will be 1.9 percent.
This factor is our estimate of the percent change in the average number of fee-for-service enrollees for CY 2001 as compared to CY 2000. Medicare+Choice (M+C) plan enrollees, whose Medicare-covered medical care is outside the scope of the SGR, are excluded from this estimate. Our actuaries estimate that the average number of Medicare Part B fee-for-service enrollees (excluding beneficiaries enrolled in M+C plans) will increase by 0.9 percent in calendar year 2001. This estimate was derived by subtracting estimated M+C enrollment from estimated overall Medicare enrollment as illustrated in the table below.
In our April 10 final notice (65 FR 19005), we indicated that the enrollment factor is one of two elements of the SGR upon which there has been the largest difference between our actuaries' estimates and the actual percentage change in the factor. At this time, our actuary has no information on actual enrollment in M+C organizations for 2001. While we do receive information on whether a M+C Plan will continue to participate or withdraw from the program in 2001, it remains difficult to estimate the number of beneficiaries that will select a M+C plan or fee-for-service before the start of the calendar year. While some managed care organizations will no longer offer a M+C plan, other plans are available as an option to most beneficiaries in areas where there have been plan withdrawals. We have considered this issue in developing our 2001 M+C enrollment estimate. While there have been plan withdrawals the past three years, we have continued to observe increased enrollments. For 2001, we considered the issue of plan withdrawals and are forecasting a smaller increase than in prior years. Since beneficiaries have the option of moving between the fee-for-service and M+C sectors on a monthly basis, there may be movement during the year between the fee-for-service and M+C programs. This is another factor that contributes to the difficulty of estimating the size of the M+C enrollee population prior to the start of a calendar year. Since the fee-for-service enrollment figure is determined net of the change in M+C enrollment, it makes early estimates of this factor difficult. We would further point out that our estimate of this factor will have little bearing on the estimate of the update adjustment factor for 2001; it has no impact since the update adjustment is already at its limit. Since the law requires revisions of the estimates used in setting the SGR, we will have information on actual enrollment in M+C plans for the first eight months of
Section 1848(f)(2)(C) of the Act, as amended by section 211 of the BBRA, requires us to estimate growth in real GDP per capita. This factor is applied on a CY basis beginning with the CY 2000 SGR. We estimate that the growth in real GDP will be 2.7 percent in CY 2001. Our past experience indicates that there have also been large changes in estimates of real per capita GDP growth and the actual change in this factor. Again, we note that we will use revised estimates of real per capita GDP growth in setting future year updates.
There are no statutory or regulatory provisions that will affect expenditures in CY 2001 relative to CY 2000. The percentage change in expenditures for physicians' services resulting from changes in law or regulations is estimated to be 0.0 percent for 2001.
A more detailed discussion of our revised estimates of the four elements of the FY 2000 and CY 2000 SGR follows.
We are continuing to use 2.1 percent for this element of the SGR for the FY 2000 SGR and the CY 2000 SGR. This factor is unchanged from earlier estimates previously described respectively for FY 2000 and CY 2000 in the October 1, 1999
This factor is our estimate of the percent change in the average number of fee-for-service enrollees for FY 2000 as compared to FY 1999 and CY 2000 as compared to CY 1999. As we indicated above, this factor is difficult to estimate prior to the beginning of the period for which the estimates are being made because of the interaction of the fee-for-service and M+C program and the lack of availability of actual data on beneficiary selection of M+C enrollment. We currently have such information on actual enrollment in the M+C program for FY 2000 and CY 2000 that permits estimates of the change in fee-for-service enrollment for these years that will be more reflective of the final actual change. The estimates for FY 2000 and CY 2000 were derived by subtracting estimated M+C enrollment from estimated overall Medicare enrollment as illustrated in the tables below.
Our actuaries' estimate of the percent change in the average number of fee-for-service enrollees, net of M+C enrollment for 2000 compared to 1999 (0.8 percent for fiscal year 2000, and 1.0 percent for calendar year 2000) is greater than earlier estimates of this factor (−4.3 percent for FY 2000 and −0.6 percent for CY 2000). This is because the historical base from which our actuarial estimate is made has changed (that is, we have more information on actual enrollment in M+C plans from CY 1999 and CY 2000 that affects our estimates for these and future years).
In the FY 2000 SGR notice published on October 1, 1999 (64 FR 53396), we estimated that real GDP growth per capita for FY 2000 would be 1.8 percent. In our April 10, 2000 SGR notice, we estimated that real per capita GDP growth for CY 2000 would be 2.5 percent. We are now estimating real GDP growth per capita to be 4.5 percent for FY 2000 and 4.3 percent for CY 2000. As we explained in our April 10, 2000 SGR notice (65 FR 19004), the higher estimate of the FY 2000 SGR is due in part to Bureau of Economic Analysis (BEA) revisions to the historical National Income and Product Accounts (NIPA) and in part due to a change in the outlook for growth in 2000. The historical revisions, released by BEA on October 29, 1999, raised historical real GDP per capita growth by 0.2 percentage points on average between 1959 and 1998, with larger differences in recent years. (For detailed description of changes to NIPA, see Brent R. Moulton, Robert P. Parker, and Eugene P. Seskin, “A Preview of the 1999 Comprehensive Revision of the National Income and Product Accounts,” Survey of Current Business (August, 1999): 7-20.) Subsequently, the projections of growth in real GDP per capita for FY 2000 have been revised upwards to reflect these revisions. Also, projections of real GDP per capita in 2000 (both FY and CY) have been revised upward to reflect stronger than expected stock market performance and less than expected buildup of inventories in preparation for Y2K in 1999.
As we explained in our October 1, 1999 and April 10, 2000 SGR notices, legislative changes contained in the BBA and the BBRA will have an impact on expenditures for physicians' services under the SGR in FY 2000 and CY 2000. Section 4103 of the BBA mandates a new prostate screening benefit effective January 1, 2000. We originally did not include any costs associated with the prostate screening benefit in our FY 2000 SGR notice published on August 1, 1999 (64 FR 53394). In the CY 2000 SGR notice published on April 10, 2000 (65 FR 19004), we indicated that inclusion of the prostate screening benefit would increase the FY 2000 SGR by 1.4 percentage points. We inadvertently included both the estimated physician and hospital expenditures associated with the prostate screening benefit in this figure while only Part B physician expenditures should be included in the SGR. In the April 10, 2000 SGR notice, we estimated that factor 4 would be 1.2 percentage points for the FY 2000 SGR and 1.7 percentage points for the CY 2000 SGR. The corresponding figures are now 0.3 percent for FY 2000 and 0.5 percent for CY 2000. The correction of the prostate screening benefit largely explains the reduction in this factor from our April 10, 2000 notice. We also incorporated a higher price for the prostate screening test itself that has the effect of slightly increasing this component of the FY and CY 2000 SGR. Other factors that affect the FY 2000 and
Certain BBRA provisions also have a small impact on expenditures in FY 2000 and CY 2000. Section 224 of the BBRA increases payments for pap smears and is slightly increasing expenditures. Section 221 of the BBRA postponed the implementation of payment caps on physical and occupational therapy and speech-language pathology services. The effect of this provision on physicians and independent practitioners is resulting in a small increase in expenditures for these years. There is no effect on the SGR of provisions related to the technical component of a physician pathology service or the use of modifier 25. We are not implementing the proposed policy related to modifier 25, and the savings associated with the technical component of a physician pathology service are not large enough to affect calculation of the FY 2001 SGR.
After taking into account these provisions, the percentage change in expenditures for physicians' services resulting from changes in law or regulations is estimated to be 0.3 percent for FY 2000 and 0.5 percent for CY 2000.
The provisions of this final rule restate the provisions of the July 2000 proposed rule, except as noted elsewhere in the preamble. Following is a highlight of the changes made from the proposed rule:
For changes related to the Geographic Practice Cost Index (GPCI), we made no changes in the 2002 and 2001 GPCIs from those proposed in the July 2000 proposed rule except to correct the Kansas malpractice GPCI. Since the revised GPCIs could not result in total payments either greater or lesser than payments that would have been made if GPCIs were not revised, it was necessary to adjust the GPCIs for budget neutrality as required by law. Therefore, we adjusted the 2001 through 2002 GPCIs as follows—work by 0.99699; practice expense by 0.99235; and malpractice by 1.00215.
For malpractice RVUs, new malpractice RVUs, based on the more recent 1996 through 1998 premium data, will become effective January 1, 2001. These malpractice RVUs will be considered interim for 2001 and subject to comment and possible revision in 2002.
We are not finalizing our proposal relating to global period for insertion, removal, and replacement of pacemakers and cardioverter defibrillators, because we believe that physicians have raised valid concerns that the adjustment to the work RVUs in the proposed rule may result in an underpayment for the service. Until we review this issue further, we are continuing with current pricing for these services and the use of the 90-day global period.
For our proposal relating to low intensity ultrasound, we are assigning .62 work RVUs and .04 malpractice RVUs to CPT code 20979 (which are the values also used for CPT code 20974). To determine the practice expense RVUs, we are applying direct inputs of technician time of 45 minutes and an exam table and minimum supply package. Since the publication of the July 2000 proposed rule, a national coverage decision has been made stating that low intensity ultrasound will be covered by Medicare as a treatment modality for nonunion of extremity fractures beginning April 1, 2001.
For our proposal concerning observation care codes CPT 99234 through 99236, we are not adjusting the work RVUs as proposed. We are maintaining the current work RVUs and clarifying the policies to be followed for the use of these codes.
This document does not impose information collection and recordkeeping requirements. Consequently, it need not be reviewed by the Office of Management and Budget under the authority of the Paperwork Reduction Act of 1995.
Because of the large number of items of correspondence we normally receive on
We have examined the impacts of this final rule as required by Executive Order 12866, the Unfunded Mandates Reform Act of 1995 (UMRA) (Pub. L. 104-4), the Regulatory Flexibility Act of 1980 (RFA) (Pub. L. 96-354), and Executive Order 13132 of August 4, 1999 (Federalism).
EO 12866 directs agencies to assess costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). A regulatory impact analysis (RIA) must be prepared for major rules with economically significant effects ($100 million or more annually). In the proposed rule impact analysis, we indicated that the rule would not be a major rule because it would not increase or decrease expenditures to a physician specialty or geographic area by more than $100 million. While the changes in the Medicare physician fee schedule are for the most part, budget neutral, they do involve redistribution of Medicare spending among procedures and physician specialties and geographic areas. The redistributive effect of this rule on any particular specialty or geographic area is, in our estimate, likely to exceed $100 million for at least one physician specialty. For this reason, we are considering this to be a major rule. The GPCI changes are expected to increase payments by less than $10 million in one locality and decrease payments by about $20 million in another locality. The effect on all other payment localities is likely to be less than these amounts.
The UMRA also requires (in section 202) that agencies prepare an assessment of anticipated costs and benefits before developing any rule that may result in expenditure in any one year by State, local, or tribal governments, in the aggregate, or by the private sector, of $100 million or more. We have determined that this rule has no consequential effect on State, local, or tribal governments. We believe the private sector cost of this rule falls below the above-stated threshold as well.
The RFA requires that we analyze regulatory options for small businesses and other small entities. We prepare a Regulatory Flexibility Analysis unless we certify that a rule would not have a significant economic impact on a substantial number of small entities. The analysis must include a justification concerning the reason action is being taken, the kinds and number of small entities the rule affects, and an explanation of any meaningful options that achieve the objectives and lessen
In addition, section 1102(b) of the Act requires us to prepare a regulatory impact analysis if a rule may have a significant impact on the operations of a substantial number of small rural hospitals. This analysis must conform to the provisions of section 604 of the RFA. For purposes of section 1102(b) of the Act, we define a small rural hospital as a hospital that is located outside of a Metropolitan Statistical Area and has fewer than 50 beds.
For purposes of the RFA, all physicians are considered to be small entities. There are about 700,000 physicians and other practitioners who receive Medicare payment under the physician fee schedule.
For the purpose of EO 12866 and the RFA we have prepared the following analysis, which, together with the rest of this preamble, meets all four assessment requirements. It explains the rationale for and purpose of the rule, details the costs and benefits of the rule, analyzes alternatives, and presents the measures we considered to minimize the burden on small entities.
Revisions in resource-based practice expense RVUs for physicians' services are calculated to be budget neutral, that is, the total practice expense RVUs for calendar year 2001 are calculated to be the same as the total practice expense RVUs that we estimate would have occurred without the changes in this regulation. This also means that increases in practice expense RVUs for some services will necessarily be offset by corresponding decreases in values for other services.
The following table shows the impact on total allowed charges by specialty of this rule's practice expense changes. In addition to the provisions of the rule, this table incorporates any impacts that result from using 1999 utilization data and other changes that we have made to practice expense inputs. The column labeled “Year 2001-2002 Impact” shows the impact on the fully implemented practice expense RVUs of changes resulting from this final rule. The column labeled “Year 2001” impact reflects only the 2001 portion of the changes from “Year 2001-2002 Impact” column. The difference between the two columns reflects the effect of the transition to fully implemented practice expense RVUs. That is, the impact in the 2001 column will reflect 75 percent of the impact on the fully implemented RVUs. These impacts are in addition to the impacts announced in previous rules related to the adoption of resource-based practice relative value units.
The following table shows the impact of this final rule compared to the proposed rule that was published on July 17. There are 3 major changes that occurred between the proposed and final rule that may have an impact on specialty level payments. First, we corrected an error in the practice expense methodology that affected physical and occupational therapy. We inadvertently used the incorrect practice expense per hour for physical and
The following table titled Impact of this Final Rule on Payments for Selected Codes shows the percentage change in total payment (in 2001 physician fee schedule dollars) for selected high-volume procedures that result from practice expense and malpractice changes announced in this final rule. These tables reflect the impact of this final rule only on the fully implemented fee schedule amount. The payments in these columns are determined using a conversion factor $38.2581. The RVUs used for calculating payment in the “old” columns are from the November 2, 1999 final rule. The RVUs used in calculating payments in the “new” columns are from this final rule. By using the conversion factor of $38.2581 and the 2001 malpractice RVUs to calculate payments in both the “old” and “new” columns, the impact of changes in practice expense are illustrated. These tables do not show the actual impact on payment from 2000 to 2001 because they do not incorporate the effect of the transition or physician fee schedule update (that is, “old” and “new” payments both reflect use of the 2001 conversion factor).
Section 1848(e)(1)(A) of the Act requires that payments under the Medicare physician fee schedule vary among payment areas only to the extent that area costs vary as reflected by the area GPCIs. The GPCIs measure area cost differences in the three components of the physician fee schedule: Physician work, practice expenses (employee wages, rent, medical supplies, and equipment), and malpractice insurance. Section 1848(e)(1)(C) of the Act requires that the GPCIs be reviewed and, if necessary, revised at least every 3 years. The first GPCI revision was implemented in 1995. The second revision was implemented in 1998, and the next revision will be implemented in 2001. Section 1848(e)(1)(C) of the Act also requires that the GPCI revisions be phased in equally over a 2-year period if more than one year has elapsed since the last adjustment.
An estimate of the overall effects of proposed GPCI changes on fee schedule area payments can be demonstrated by a comparison of area geographic adjustment factors (GAFs). The GAFs are a weighted composite of each area's work, practice expense, and malpractice expense GPCIs using the national GPCI cost share weights. While we do not actually use the GAFs in computing the fee schedule payment for a specific service, they are useful in comparing overall area costs and payments. The actual effect on payment for any actual service will deviate from the GAF to the extent that the service's proportions of work, practice expense, and malpractice expense RVUs differ from those of the GAF. Addendum H shows the estimated effects of the revised GPCIs on area GAFs in descending order.
Only 14 of the 89 fee schedule areas will change by at least 2 percent. Only 16 areas will change by from 1 to 1.9 percent. The remaining 59 areas are estimated to experience payment changes of less than 1 percent under the revised GPCIs. These are very minor changes that would be expected in that we are revising only the rent indices, comprising 11.6 percent of the total GPCI, and the malpractice expense indices, comprising 3.2 percent of the GPCI. Thus, only about 15 percent of the GPCIs will be subject to change. The effects in the transition year 2001 will only be one-half of these amounts as the revised GPCIs will be phased in over a 2-year period as required by law.
The malpractice RVUs in this final rule reflect the newer data and refinements made as a result of comments made on last year's rule. As we anticipated in the proposed rule, use of the updated data results in little impact on the specialty level payments. Tables showing the impacts can be found in the technical addendum at Addendum G. Of the 62 specialties shown, the overall median effect on specialty payments is 0.0 percent. The median impact on specialties whose payments are estimated to increase is +0.2 percent. The median impact on specialties whose payments are expected to decrease is -0.1 percent.
As we explained in the preamble in the November 1999 final rule, we established interim work RVUs for 2000 for CPT codes 99291 and 99292 (critical care services). These RVUs were decreased in 2000 due to concerns about changes in the CPT definition for these services. In the proposed rule we indicated our intent to increase the work RVUs for critical care services and value the physician work at 4.0 RVUs for CPT code 99291 and 2.0 RVUs for CPT code 99292 because of changes that were made to the definition of critical care for 2001. The earlier reductions to the work RVUs were made assuming there would be a substitution of use of the critical care codes for other codes that would increase net payments if there were no reductions to the work RVUs. We do not believe this substitution will occur because of additional revisions to the definition of critical care for 2001. Thus net payments would decrease if we do not restore critical care RVUs to their former levels. For this reason we are finalizing our proposal and increasing the work RVUs to 4.0 RVUs for CPT code 99292.
We are establishing two new HCPCS codes for care plan oversight that are consistent with our coverage criteria. We are establishing two new HCPCS codes to describe the services involved in physician certification or recertification and development of a plan of care for a patient for whom the physician has prescribed Medicare-covered home health services. We are assuming there would be no additional cost or savings as a result of the two new HCPCS codes for care plan oversight. We are merely instituting these codes for consistency with our coverage criteria, and they would be used in place of the CPT codes when these services are provided.
In our proposed rule we indicated that new HCPCS codes are being established for physician certification or recertification and development of a plan of care. We stated that payment for these services is currently included in the payment for a variety of services such as E/M services that are provided independently to patients as part of a global surgical service. Under this proposal, we would instead pay separately for the certification and recertification of the plan of care for home health services. Since we are proposing to pay separately for a service that is currently included in our payment for other services, this proposal would increase Medicare expenditures for physicians' services without an adjustment to the physician fee schedule CF. For this reason, we proposed to adjust the physician fee schedule CF to ensure that Medicare payments for physicians' services do not increase as a result of this proposal.
The sustainable growth rate determined under section 1848(f) of the Act allows for an adjustment for changes in expenditures that “will result from changes in law and regulations.” Since there are no new requirements being imposed upon physicians and there are no regulatory changes that would mandate an adjustment to the SGR, we are making a budget neutrality adjustment to the conversion factor to ensure that expenditures do not increase as a result of this provision. We estimate that paying separately for certification and recertification of a plan of care for home health services will increase Medicare payments without the 0.3 percent offsetting adjustment to the conversion factor that we have applied.
We believe that there are not any significant costs for this policy clarification. We believe physicians have not typically been billing for the discharge component of a hospital or observation stay of less than 8 hours. However, physicians who have been billing 99234 through 99236 for stays less than 8 hours in length would see a small reduction in payment. This policy clarification will give clear guidance to physicians and Medicare contractors in reviewing medical records and would assure consistent payment across contractors.
As previously stated, we are establishing national HCPCS codes and payment amounts for ocular photodynamic therapy. If we did not establish national codes and pricing for this procedure, carriers that determined that this procedure is covered would use unlisted codes and determine pricing locally. There will be no budget effects associated with establishing national codes and payment amounts for this service since national pricing would substitute for use of unlisted codes and carrier pricing.
As stated earlier, we are establishing a national payment amount for electrical bioimpedance. This rule establishes national pricing amounts for a service currently priced by carriers. This change will have little impact on the Medicare program costs.
We proposed to change the global period for certain CPT codes involving the insertion, removal, and replacement of pacemakers and cardioverter defibrillators from 90 days to 0 days. The proposed changes were not anticipated to result in cost or savings because we proposed to reduce the work and practice expense RVUs to account for any claims that we would receive for post-operative visits that were previously bundled into payment for the 90-day global surgical service. As a result of comments received on the proposed rule, we are not adopting the proposed policy. The global period will remain at 90 days, and we will not implement the proposed reductions to the work and practice expense RVUs. Thus, since there is no change in policy, there are no budget implications of our decision on this issue in the final rule.
Our change from permitting a physician to bill for a 12-month, as opposed to a 12-week supply of antigen could benefit beneficiaries, since they will be able to obtain a year's supply of medication in a single visit. We believe that this change has no impact on program costs. Also, there is no impact on the beneficiary, since this change only aggregates four prescriptions into one, and the cost to the beneficiary remains the same.
We are making an adjustment to our application of the salary equivalency guidelines that are used to determine the indirect components of the practice expense per hour for physical and occupational therapy. Payments for all outpatient physical and occupational therapy services will increase by 3 and 4 percent, respectively. This change will be budget neutral among all physician fee schedule services.
Other issues mentioned in the preamble are merely discussions or clarifications and, therefore, have no budgetary impact.
Each year since the fee schedule has been implemented, our actuaries have determined any adjustments needed to meet the budget-neutrality requirement of the statute. A component of the actuarial determination of budget-neutrality involves estimating the impact of changes in the volume-and-intensity of physicians' services provided to Medicare beneficiaries as a result of the proposed changes. Consistent with the provision in the November 1998 final rule, the actuaries would use a model that assumes a 30 percent volume-and-intensity response to price reductions. This year there will be a 5.0 percent increase in the conversion factor resulting from the physician fee schedule update. Since this update will offset any negative payment impacts resulting from this final rule, no volume and intensity adjustment is being incorporated into the physician fee schedule conversion factor in 2001.
Although changes in physicians' payments when the physician fee schedule was implemented in 1992 were large, we detected no problems with beneficiary access to care. Furthermore, since beginning our transition to a resource-based practice expense system in 1999, we have not found that there are problems with beneficiary access to care.
We have reviewed this final rule under the threshold criteria of EO 13132, Federalism, and we have determined that the final rule does not significantly affect the rights, roles, and responsibilities of States.
Health facilities, Health professions, Kidney diseases, Laboratories, Medicare, Rural areas, X-rays.
Administrative practice and procedure, Health facilities, Health professions, Kidney diseases, Medicare,
Secs. 1102 and 1871 of the Social Security Act (42 U.S.C. 1302 and 1395hh).
Medicare Part B pays for—
(b) A supply of antigen sufficient for not more than 12 months that is—
Secs. 1102, 1871, and 1881(b)(1) of the Social Security Act (42 U.S.C. 1302, 1395(hh), and 1395rr(b)(1).
(b) * * *
(5) * * *
(i) Usually there are two levels of practice expense RVUs that correspond to each code.
(A)
(B)
(C)
These addenda will not appear in the Code of Federal Regulations.
The addenda on the following pages provide various data pertaining to the Medicare fee schedule for physicians' services furnished in 2001. Addendum B contains the RVUs for work, non-facility practice expense, facility practice expense, and malpractice expense, and other information for all services included in the physician fee schedule.
This addendum contains the following information for each CPT code and alphanumeric HCPCS code, except for alphanumeric codes beginning with B (enteral and parenteral therapy), E (durable medical equipment), K (temporary codes for nonphysicians' services or items), or L (orthotics), and codes for anesthesiology.
1.
2.
Modifier −53 is shown for a discontinued procedure. There will be RVUs for the code (CPT code 45378) with this modifier.
3.
A = Active code. These codes are separately payable under the fee schedule if covered. There will be RVUs for codes with this status. The presence of an “A” indicator does not mean that Medicare has made a national decision regarding the coverage of the service. Carriers remain responsible for coverage decisions in the absence of a national Medicare policy.
B = Bundled code. Payment for covered services is always bundled into payment for other services not specified. If RVUs are shown, they are not used for Medicare payment. If these services are covered, payment for them is subsumed by the payment for the services to which they are incident. (An example is a telephone call from a hospital nurse regarding care of a patient.)
C = Carrier-priced code. Carriers will establish RVUs and payment amounts for these services, generally on a case-by-case basis following review of documentation, such as an operative report.
D = Deleted code. These codes are deleted effective with the beginning of the calendar year.
E = Excluded from physician fee schedule by regulation. These codes are for items or services that we chose to exclude from the physician fee schedule payment by regulation. No RVUs are shown, and no payment may be made under the physician fee schedule for these codes. Payment for them, if they are covered, continues under reasonable charge or other payment procedures.
G = Code not valid for Medicare purposes. Medicare does not recognize codes assigned this status. Medicare uses another code for reporting of, and payment for, these services.
N = Noncovered service. These codes are noncovered services. Medicare payment may not be made for these codes. If RVUs are shown, they are not used for Medicare payment.
P = Bundled or excluded code. There are no RVUs for these services. No separate payment should be made for them under the physician fee schedule.
R = Restricted coverage. Special coverage instructions apply. If the service is covered and no RVUs are shown, it is carrier-priced.
T = Injections. There are RVUs for these services, but they are only paid if there are no other services payable under the physician fee schedule billed on the same date by the same provider. If any other services payable under the physician fee schedule are billed on the same date by the same provider, these services are bundled into the service(s) for which payment is made.
X = Exclusion by law. These codes represent an item or service that is not within the definition of “physicians services” for physician fee schedule payment purposes. No RVUs are shown for these codes, and no payment may be made under the physician fee schedule. (Examples are ambulance services and clinical diagnostic laboratory services.)
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
MMM = The code describes a service furnished in uncomplicated maternity cases including antepartum care, delivery, and postpartum care. The usual global surgical concept does not apply. See the 1999 Physicians' Current Procedural Terminology for specific definitions.
XXX = The global concept does not apply.
YYY = The global period is to be set by the carrier (for example, unlisted surgery codes).
ZZZ = The code is part of another service and falls within the global period for the other service.
This addendum to the original April 1999 Report on Resource Based Malpractice Relative Value Units (RBMRVUs) describes the first update to the RBMRVUs. The Original Report converted the Malpractice Relative
The changes included in this update are as follows:
• 1996-98 Malpractice Premium Data replaces 1993-95 Malpractice Premium Data.
• Where premium data was not available, KPMG consulted the rating manuals of 5 physician malpractice insurers as opposed to using just St. Paul's manual.
• In the Original Report, Neurosurgeons had separate risk factors for surgical and non-surgical procedures. This has been changed so that the same surgical risk factor is used for all procedures performed by Neurosurgeons.
• The risk factor used for most surgical procedures performed by Neurologists and Cardiologists is now the factor for minor surgery. In the original report, the factor for major surgery was used. Pursuant to our conversation, the change was made because the surgical procedures performed by Neurologists and Cardiologists are less intensive than those performed by their surgical counterparts This change was made for all procedures except invasive Cardiology procedures, which are discussed in the following item.
• Risk factors for invasive Cardiology procedures, including Cardiac Catheterizations and Angioplasties, were established separately from risk factors for other procedures, and were based on data from the new malpractice survey for Cardiologists performing these procedures. These invasive Cardiology procedures have the following Current Procedural Terminology (CPT) Codes: 92980-92998, 93501-93536, 93600-93614, 93617-93641 and 93643-93652.
• 1999 Physician Utilization data provided by HCFA mapped to 2000 CPT codes was used as the basis for the distribution of physician specialty by procedure. The first report used 1997 utilization data mapped to 1999 CPT codes.
This addendum includes an analysis of the impact of the new risk factors and a numerical example illustrating the calculation of the CPT level RBMRVUs. This addendum has been organized according to the structure of the initial Resource Based Malpractice RVU report. Only those sections with changes have been updated.
The exhibit on pages 6-7 illustrates the impact that this update has on the various physician specialties. All figures are expressed as a percentage of total RVUs, including the impact percentages. Anesthesiologists and Pathologists derive only a small portion of their income from procedures which have explicit Malpractice Relative Value Units. The impact to Anesthesiologists and Pathologists as presented in this exhibit shows the change in the portion of their income attributable only to those codes having explicit Malpractice Relative Value Units. Total RVUs are calculated using the 2000 physician fee schedule. Other changes will take place in 2001 that may change these percentages as a percentage of total RVUs. In particular, an additional year of phasing in the Resource Based Practice Expense RVUs may have a significant impact on the Malpractice RVUs as a percentage of total RVUs by specialty. It is the intention of this exhibit to show only the isolated impact of the RBMRVU change. For this reason, other changes made in the 2001 RBRVS have not been included.
This update produces more modest changes than were originally made by converting the Malpractice RVUs from a charge basis to a resource basis. The biggest gains are for Orthopedic Surgeons (+1.1%) and Hand Surgeons (+0.7%). These changes occur for the following reasons:
•
•
The biggest reductions are for Anesthesiologists (−1.3%), Nephrologists (−0.9%), and Cardiologists (−0.7%). Explanation of these losses are as follows:
•
•
•
The exhibit on pages 9-11 shows the impact that the proposed update to the RBMRVUs will have on different types of procedures. All figures are again expressed as a percentage of total RVUs including the impact percentages. The largest increases are for Maternity (+2.0%), Musculoskeletal surgeries
•
•
•
The largest decreases were for Dialysis (−1.6%) and Medical Cardiovascular procedures (−1.4%).
Following is an explanation of these reductions:
•
•
Please see the April 1999 report on RBMRVUs for a complete description of the charge based Malpractice RVUs.
The original development of Resource Based Malpractice RVUs relied upon malpractice insurance premiums for the 1993-95 period. As part of the update to the Malpractice Geographic Practice Cost Indices (GPCI) scheduled to be implemented in the 2001 fee schedule, KPMG collected physician malpractice insurance data for the 1996-98 period. One of the purposes of this addendum is to establish new specialist risk factors derived from the information collected in the most recent survey.
In order to collect the necessary premium data, 52 Departments of Insurance (DOI) from all fifty states, Washington D.C. and Puerto Rico were contacted and sent questionnaires. Each Department of Insurance was requested to supply:
• 1996-98 Premium Rates for the top Physician Malpractice Insurers doing business in the state. These premium rates had to conform to a very specific benefit plan. Annual premiums were collected and/or adjusted to the following specifications: $1 million limit on individual claims/ $3 million limit on aggregate claims, mature “claims-made” coverage (see Section 4.2.2. of the Third Update of the GPCI for a detailed discussion of “claims-made”).
• Name and number of contacts at the DOI and Insurance Carriers.
• Definitions of the geographic rating areas used in the state.
• Definitions of Risk Classifications.
For the majority of states, copies of rate filings were obtained. A few states summarized this information by specialty across insurer. Some states did not have filings or could not comply with the survey in a timely manner. For these states, malpractice insurers were contacted directly.
Some states have Joint Underwriting Associations (JUAs) and Patient Compensation Funds (PCFs) that impact physician malpractice costs. The South Carolina JUA was included because it has the majority market share. All other JUAs were excluded. PCFs were included only when participation was mandatory, with one exception. In South Carolina, the PCF was included even though it is not mandatory because the majority of South Carolina physicians that participate in the JUA also participate in the PCF.
Since PCFs often provide unlimited coverage, states with mandatory PCFs may have a cost level that is higher than the $1 million/$3 million limits mentioned previously. For those states, no actuarial adjustment was made to reduce the premium level to a $1 million/$3 million policy. This was considered appropriate since the intention of the survey was to track actual physician costs as closely as possible.
Overall KPMG collected physician malpractice insurance premium data on a total of 46 companies across all 50 states, Puerto Rico, and Washington, D.C. Insurance companies that operated in more than one state are counted once in this total. In 38 states KPMG collected data from at least two companies. In the remainder of the states, KPMG received information from one company. In each of these states, the sole insurer had a medical malpractice market share of 49% or more (medical malpractice insurance includes physician and hospital malpractice insurance). On average, data was collected from insurance companies with a 56% medical malpractice market share.
There is reason to believe that the actual captured
The Office of Management and Budget (OMB) approved physician malpractice survey was primarily designed to update the GPCI not the Malpractice RVU. The needs of the two updates are not the same. While the GPCI focuses on regional cost differences, the ideal Malpractice RVU survey would provide more detail on premium variations by specialty. In accordance with the OMB approved survey, malpractice data was collected for twenty physician specialties. (There are over 90 HCFA specialty codes.) Since the amount of time it takes to perform the survey is a critical component of OMB approval, the number of specialties tracked in the survey has not been changed. In order to supplement the premium survey, five rating manuals were used from among the largest malpractice insurers in order to derive risk factors for specialties not tracked in the survey. Even for the twenty specialties tracked in the survey, it was necessary to supplement the premium data with risk factors from the selected five insurers. Since the survey specified the level of surgical involvement for a specialty, it was not possible to get a surgical and non-surgical risk factor from the same premium data.
Typically malpractice insurers sub-divide each specialty into three separate levels of surgical involvement:
The surgical risk factors are derived from the highest level of surgical involvement listed for the specialty in the insurers rating manual, typically the “major surgery” category. The non-surgical factors are derived from the lowest level of surgical involvement listed, typically the “no surgery” factors. For those surveyed specialties that had minor surgical involvement, the premium data was used as a reasonability check with the selected surgical and non-surgical risk factors. The minor surgery premium risk factor should fall between the surgical and non-surgical factors and should also be in line with the minor surgery risk factor of the median or most representative rating manual.
For Cardiologists and Neurologists, the minor surgery premium average was also used to set the surgical risk factors. This is due to the fact that the surgical procedures that these specialties perform tend to fit the minor surgery category.
One American Medical Association (AMA) suggestion regarding the first calculation of the RBMRVUs was their desire that surgical specialties always be granted their surgical risk factor even for the non-surgical procedures that they perform. This change has been incorporated in this update of the risk factors for specialties defined as surgeons. The two specialties impacted by this change are Neurosurgeons and Surgical Oncologists.
In the first RBMRVU calculation, Neurologists and Neurosurgeons shared surgical and non-surgical risk factors. This was not inconsistent with the St. Paul's rating manual. Neurosurgeons received higher Malpractice RVU compensation because they performed more surgical procedures. However, the surgical risk factor for Neurosurgeons is now used to calculate the malpractice RVUs for all procedures they perform—surgical and non-surgical. As noted above, Neurologists receive the minor surgery risk factor for the surgical procedures they perform.
In the original report, Surgical Oncologists were mapped to the Avg. Physician risk factors with separate surgical and non-surgical risk factors. In this update, Surgical Oncologists are given the General Surgeons' risk factors which are the same for surgical and non-surgical procedures.
The following table (A-1) shows how the premium data was used for each of the twenty tracked physician specialties (note that any risk factor that is not calculated using premium data from the survey was derived from the rating manual risk factors):
Please see the Final Report on the Resource Based Malpractice RVUs for a complete overview of the methodology. This update only describes changes to the original methodology. The following changes are being implemented in this update:
• 1996-98 Malpractice Premium Data is used in place of 1993-95 Premium Data.
• Physician premium data from the survey is used to calculate risk factors according to Table A-1 of this update.
• The premium weighted average risk factors of five selected Malpractice Insurers are used. They are Continental Casualty Company (CNA), St. Paul Fire and Marine Insurance Company (St. Paul), Medical Liability Mutual Insurance Company (MLMIC), Medical Protective Company (Medical Protective), and Doctors Company. These five insurers are among the largest malpractice insurers. This is the methodology used for all specialties that are not based on malpractice premium data.
Please see the April 1999 Report on RBMRVUs for a complete discussion of malpractice insurer's ISO codes and how they are translated into Medicare Physician Specialty Codes.
Please see section M.3. of the Final Report on the Resource Based Malpractice RVUs for a complete discussion of methodology. One of the adjustments described in that report “normalizes” the premium data in the survey for the geographic spread of specialties. A geographic bias is measured by calculating the average Malpractice GPCI that a specialty receives. Variations can be noticeable. For example, it was found that Psychiatrists have a Malpractice GPCI that is 5.6% above the average while General/Family Practitioners are 6.2% below the average. Not to adjust for this phenomenon would effectively create a “double count” of the geographic concentration of a given specialty. Specialties more highly concentrated in high malpractice cost areas would receive higher RVUs because their premiums would be higher, in part due to their geographic concentration in higher cost areas. At the same time they would receive a higher Malpractice GPCI for the identical reason. For specialties more highly concentrated in lower malpractice cost areas, the opposite would be true. They would be effectively “double penalized” for their concentration in low malpractice cost areas. By dividing each specialty's premium by its average Malpractice GPCI, risk factors developed from these new adjusted premiums more accurately reflect the relative cost differences of each specialty as opposed to the geographic dispersion of the specialty.
This normalization calculation has been updated for the risk factors used in this update. A 1998 RVU distribution was used in place of the 1997 RVU distribution used in the original report. The 2002-3 Malpractice GPCI was used as the basis for the normalization. The 2001 “phase-in” Malpractice GPCI was considered, but the 2002-2003 Malpractice GPCI was utilized since it will be in place longer than the 2001 Malpractice GPCI and it is unlikely that Malpractice RVUs will be updated in the interim (beyond updates for new CPT codes).
In Table A-2, the average malpractice premiums tracked in the survey are shown along with their average 2002-3 Malpractice GPCI and the adjusted premium used for risk factors. Note that Psychiatry has been normalized to a 1.31 risk factor to be consistent with the average non-surgical factor developed from the five malpractice insurers' rate manuals (see Table A-3) for Psychiatry. This makes it easier to perform an “apples to apples” comparison of the risk factors developed from premium data versus the comparable rating manual risk factors.
Consistent with the development of the original RBMRVUs, separate surgical and non-surgical risk factors continue to be used. For the purposes of calculating RBMRVUs surgeries are defined as CPT codes falling in the range of 10000 through 69999, and codes 92980-92998, 93501-93536, 93600-93614, 93617-93641 and 93643-93652.
Medicare specialty codes do not distinguish between Obstetricians and Gynecologists. However, malpractice premiums can be quite different for these specialties. Because the majority of Medicare OB/GYN services will be Gynecological, a Gynecology risk factor was used for all OB/GYN procedures, except those that are clearly Obstetrical, such as maternity codes (59000-59899). These codes were assigned a risk factor that is consistent with a risk factor for an Obstetrician who performs surgery in the Original Report. This practice is continued in this addendum. The obstetrical risk factor has been updated.
Obstetricians and Gynecologists have raised the concern about their average malpractice premium and their corresponding Malpractice RVUs. The survey tracked the Malpractice premium for a Gynecologist who does not perform surgery. We recognize that approximately 40% of Work RVUs paid to Gynecologists under the Medicare program are for surgical procedures. We also recognize that Obstetricians have virtually no utilization under the Medicare program and that they will pay much more for Malpractice Insurance than the typical Gynecologist.
These issues have been addressed in the risk factor methodology. First, Gynecologists receive a risk factor consistent with their Malpractice Survey Premium only for non-surgical procedures. For their surgical procedures they receive a risk factor that is 3.26 times (6.17 vs. 1.89) that which would be granted if we only used their Survey Premium. Second, Obstetricians have been handled by making an explicit adjustment to the maternity codes in order to reflect their higher malpractice costs. These codes are granted a risk factor of 10.83 (based on the rate manuals) which is 76% higher than the Gynecologists' Surgical risk factor and 461% higher than the Gynecologists' Non Surgical risk factor.
If the risk factor calculated for a Spinal Surgery procedure (CPTs 22100-22899) falls below the risk factor for an Orthopedic Surgeon performing Spinal Surgery (8.64), then the risk factor for an Orthopedic Surgeon performing spinal surgery is used.
The following codes receive the greater of their actual average risk factor or the risk factor for invasive Cardiology (3.16): 92980-92998, 93501-93536, 93600-93614, 93617-93641 and 93643-93652.
The Risk Factor Assignment Algorithm from the original report is presented in this section. Changes are indicated in bold:
Having discussed the background and issues surrounding the physician risk factors, the actual mechanics of the algorithm used to assign risk factors will now be described. The assignment algorithm was as follows:
1. The lowest normalized malpractice premium specialty was determined to be Psychiatry. This specialty was assigned a risk factor value of “1.31”. This factor was selected to be consistent with the risk factor developed for non-surgical Psychiatry developed from rating manuals.
2. If the specialty's normalized average malpractice premium is the basis for the risk factor (as defined in Table A-1), the Risk Factor was calculated as follows:
For example, Ophthalmologists' had a 96-98 average premium of $11,209. Their average MGPCI was 0.98915. Dividing $11,209 by .98915 yields $11,332 as the normalized average premium. Dividing this result by the adjusted Psychiatrists' premium ($11,332/$6,263) gives an answer of 1.81. This 1.81 is then multiplied by 1.31 to give the final risk factor of 2.37.
3. If the risk factor was not being set with malpractice premium data, five rating manuals from among the largest malpractice insurers were consulted and an average risk factor (RF) was developed based on the market share weighted average. Using Psychiatry, non-surgical as an example: C.N.A. Weighting × C.N.A. RF + St. Paul Weighting × St. Paul RF + M.L.M.I.C. Weighting × M.L.M.I.C. RF + Medical Protective Weighting × Medical Protective Risk Factor + Doctors Weighting × Doctors Risk Factor =
The April 1999 report on the RBMRVU describes this dataset. For this update, we used 1999 utilization data cross walked to 2000 CPT codes. HCFA performed this cross walk before giving the utilization data to KPMG. The most critical task performed on this data by KPMG was the application of the Modifiers to the underlying utilization data. KPMG made the conversions to the Allowed Services counts outlined in the table on the next page. The adjustments in the table are consistent with the modifier adjustments that HCFA specifies for processing physician claims.
Please see the April 1999 report for a complete description of the calculation. The formula for calculating the risk factors is stated below:
Please see table A-5 for the assignments made for codes with insufficient utilization data.
Please see the April 1999 report for a complete discussion. The new budget neutrality adjustment is .0171569. Note that this adjustment is applied before inclusion of the technical codes which are left unchanged.
The formula for budget neutrality and the final calculation of RBMRVUs is given below:
This budget neutrality adjustment is multiplied by the Unadjusted RBMRVUs to get the final RBMRVUs.
The development of risk factors has been demonstrated in a previous section. This numerical example will focus on applying those risk factors to the Procedure Code Malpractice Relative Value Units.
This example will look at the calculation of the Resource Based Malpractice RVU for code 99213-Office/Outpatient Visit, Established Patient, and is shown on the next page. We start with raw physician specialty utilization databased on 1999 utilization and mapped to 2000 codes by the Health Care Financing Administration. In the exhibit, Column B shows the distribution of services by specialty. Column B is labeled “Adjusted Allowed Services” because certain modifier rules have been applied to the counts.
Notice that 0.74% of the services are performed by specialties that have not had risk factors developed for them (“OTHER”). For this 99213 code, this is largely comprised of Physician Assistants and Nurse Practitioners.
The next step is to determine the average risk factor. Column D shows the product of each specialties' risk factor multiplied by the number of Allowed Services for that specialty. If we add up each specialties' product and divide by the total number of allowed services, we have calculated the average risk factor for the code. For code 99213 this is (190,908,055) / (86,449,686) = 2.21. Note that this is just an application of the following formula shown in Section M6:
Next we need to multiply the average risk factor for the code by the Work RVUs for the code. For code 99213 this is: 2.21 * 0.67 = 1.48. Finally the budget neutrality adjustment of .0171569 is applied to 1.48. The result is .0171569 * 1.48 = .03 Malpractice RVUs.
Office of Postsecondary Education, Department of Education.
Final regulations.
These final regulations govern the new Special Leveraging Educational Assistance Partnership (SLEAP) Program. These regulations implement changes made to the Higher Education Act of 1965, as amended (HEA), by the Higher Education Amendments of 1998, Public Law 105-481 (1998 Amendments).
Ms. Jackie Butler, U.S. Department of Education, 400 Maryland Avenue, SW., room 3045, ROB-3, Washington, DC 20202-5447. Telephone: (202) 708-8242.
If you use a telecommunications device for the deaf (TDD), you may call the Federal Information Relay Service (FIRS) at 1-800-877-8339.
Individuals with disabilities may obtain this document in an alternative format (e.g., Braille, large print, audiotape, or computer diskette) on request to the contact person listed under
These regulations implement a new program, the SLEAP Program, added by the 1998 Amendments. On July 27, 2000, we published a notice of proposed rulemaking (NPRM) in the
In the preamble to the NPRM, we discussed the proposed regulatory provisions that were not of a minor or technical nature, and we will not repeat that discussion here. Therefore, to fully understand the SLEAP Program regulations, we strongly encourage a review of the NPRM preamble. The following list summarizes those major provisions and identifies the pages of the preamble to the NPRM on which the discussion can be found:
This section specifies the requirements that a State must meet to receive funds under the SLEAP Program. (page 46325)
This section specifies the eligibility requirements that postsecondary students must meet to receive SLEAP financial assistance and non-postsecondary students must meet to receive services under the SLEAP Program. (page 46325)
This section specifies the procedures that a State must follow to receive a SLEAP allotment. (pages 46325-46326)
This section specifies the formula used to allocate SLEAP funds to the participating States. (page 46326)
This section specifies the authorized SLEAP activities. (pages 46326-46327)
There are no differences between the proposed regulations contained in the NPRM and these final regulations.
Section 482(c) of the HEA requires that regulations affecting programs under Title IV of the HEA be published in final form by November 1 prior to the start of the award year (which begins July 1) in which they apply. However, that section also permits the Secretary to designate any regulation as one that an entity subject to the regulation may choose to implement earlier. If the Secretary designates a regulation for early implementation, he may specify when and under what conditions the entity may implement it. Under this authority, the Secretary designates §§ 692.50 through 692.80 of the SLEAP Program regulations for early implementation. Upon publication, these regulations may be implemented by the States at their discretion.
The regulaions in this document were developed through the use of negotiated rulemaking. Section 492 of the HEA requires that, before publishing any proposed regulations to implement programs under Title IV of the HEA, the Secretary obtain public involvement in the development of the proposed regulations. After obtaining advice and recommendations, the Secretary must conduct a negotiated rulemaking process to develop the proposed regulations.
These regulations were published in the
We discuss issues under the sections of the regulations to which they pertain. Generally, we do not address technical and other minor changes—and suggested changes the law does not authorize the Secretary to make.
The commenter indicated that some of the postsecondary authorized SLEAP activities target students at four-year institutions. For example, the commenter indicated that few community colleges have a teacher preparation program, yet one of the allowable activities is a scholarship program for eligible students who wish to become teachers. The commenter further pointed out that the referenced § 692.21(f) requires that, with a limited exception, all public and private nonprofit institutions of higher education, including two-year institutions shall be eligible to participate in the SLEAP Program. The commenter indicated that these two provisions may be inconsistent. The commenter suggested that if an institution, such as a two-year institution, does not have a program that fits into one of the SLEAP activities, the State should not have to ensure that
This position mirrors the one we adopted for the former National Early Intervention Scholarship and Partnership (NEISP) Program. The NEISP statute also referred to eligible students for purposes of being a participant in the early intervention component. The NEISP regulations required that the States select only students for the early intervention component who were citizens or eligible noncitizens. Moreover, this position is consistent with the student eligibility requirements for the Talent Search and Upward Bound Programs, each of which serve students before they enroll in postsecondary institutions.
We have reviewed these final regulations in accordance with Executive Order 12866. Under the terms of the order, we have assessed the potential costs and benefits of this regulatory action.
The potential costs associated with the final regulations are those resulting from statutory requirements and those we have determined are necessary for administering this program effectively and efficiently.
In assessing the potential costs and benefits, both quantitative and qualitative, of these final regulations, we have determined that the benefits of the regulations justify the costs.
We have also determined that this regulatory action does not unduly interfere with State, local, and tribal governments in the exercise of their governmental functions.
We discussed the potential costs and benefits of these final regulations in the preamble to the NPRM on page 46327.
The Paperwork Reduction Act of 1995 does not require you to respond to a collection of information unless it displays a valid Office of Management and Budget (OMB) control number. There are no collections of information in these final regulations that require the display of an OMB control number.
The SLEAP Program is subject to the requirements of Executive Order 12372 and the regulations in 34 CFR part 79. The objective of the Executive order is to foster an intergovernmental partnership and a strengthened federalism by relying on processes developed by State and local governments for coordination and review of proposed Federal financial assistance.
In accordance with the order, we intend this document to provide early notification of the Department's specific plans and actions for this program.
In the NPRM we requested comments on whether the proposed regulations would require transmission of information that any other agency or authority of the United States gathers or makes available.
Based on the response to the NPRM and on our review, we have determined that these final regulations do not require transmission of information that any other agency or authority of the United States gathers or makes available.
You may view this document in text or Adobe Portable Document Format (PDF) on the Internet at the following sites:
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The official version of this document is the document published in the
Grant programs—education, Postsecondary education, State administered—education, Student aid—education, Reporting and recordkeeping requirements.
20 U.S.C. 1070c through c-4, unless otherwise noted.
The Special Leveraging Educational Assistance Partnership (SLEAP) Program assists States in providing—
(a) Grants, scholarships, and community service work-study assistance to eligible postsecondary education students who demonstrate financial need;
(b) Assistance to fund early intervention, mentoring, and career education programs for eligible students enrolled in preschool, elementary school, or secondary school who demonstrate financial need; and
(c) Assistance to fund transition programs for eligible students enrolled in secondary school who demonstrate financial need.
The regulations listed in § 692.3 also apply to the SLEAP Program.
The following definitions apply to the SLEAP Program:
(a) The definitions listed in § 692.4.
(b) The definitions of the following terms in 34 CFR 77.1 (EDGAR):
Elementary school.
Preschool.
Secondary school.
To receive SLEAP Program funds for any fiscal year, a State must—
(a) Participate in the LEAP Program;
(b) Meet the requirements in § 692.60; and
(c) Have a program that—
(1) Provides assistance only to students who meet the eligibility requirements in § 692.54;
(2) Satisfies the requirements in §§ 692.21(a) and (k); and
(3)(i) Satisfies the requirements in §§ 692.21(e), (f), (g), and (j), if that program provides students with postsecondary education assistance; or
(ii) Provides that no student or parent may be charged a fee that is payable to an organization other than the State for the purpose of collecting data to make a determination of financial need for preschool, elementary, or secondary school students.
(a) To receive postsecondary financial assistance under the SLEAP Program, a student must meet the eligibility requirements contained in § 692.40.
(b) To receive early intervention, mentoring, career education or transition program services under the SLEAP Program, a preschool, elementary, or secondary school student must—
(1) Meet the applicable citizenship and residency requirements in 34 CFR 668.33; and
(2) Demonstrate financial need as determined by the State.
To receive an allotment under the SLEAP Program, a State must—
(a) Submit an application in accordance with the provisions in § 692.20;
(b) Identify the activities in § 692.71 that it plans to carry out;
(c) Provide an assurance that for the fiscal year prior to the fiscal year for which the State is requesting Federal funds, the amount the State expended from non-Federal sources per student, or the aggregate amount the State expended, for all the authorized activities in § 692.71 will be no less than the amount the State expended from non-Federal sources per student, or in the aggregate, for those activities for the second fiscal year prior to the fiscal year for which the State is requesting Federal funds; and
(d) Ensure that the Federal share will not exceed one-third of the total funds expended under the SLEAP Program.
For each fiscal year, the Secretary allots to each eligible State that applies for SLEAP funds an amount in accordance with the provisions in § 692.10.
(Authority: 20 U.S.C. 1070c-3a)
A State may use the funds it receives under the SLEAP Program to implement one or more of the following:
(a) Increase the dollar amount of grants awarded under the LEAP Program to eligible students who demonstrate financial need as determined in § 692.41.
(b) Carry out transition programs from secondary school to postsecondary education for eligible students who demonstrate financial need as determined by the State.
(c) Carry out a financial aid program for eligible students who demonstrate financial need as determined in § 692.41 and who wish to enter careers in information technology or other fields of study determined by the State to be critical to the State's workforce needs.
(d) Make funds available for community service work-study activities for eligible students who demonstrate financial need as determined in § 692.41.
(e) Create a postsecondary scholarship program for eligible students who demonstrate financial need as determined in § 692.41 and who wish to enter teaching.
(f) Create a scholarship program for eligible students who demonstrate financial need as determined in § 692.41 and who wish to enter a program of study leading to a degree in mathematics, computer science, or engineering.
(g) Carry out early intervention programs, mentoring programs, and career education programs for eligible students who demonstrate financial need as determined by the State.
(h) Award merit or academic scholarships to eligible students who demonstrate financial need as determined in § 692.41.
(Authority: 20 U.S.C. 1070c-3a)
When administering its community service work-study program, a State must follow the provisions in § 692.30, other than the provisions of paragraph (a)(1) of that section.
Office of Postsecondary Education, Department of Education.
Final regulations.
The Secretary amends the Federal Perkins Loan (Perkins Loan) Program regulations. These final regulations are intended to improve collections in the Perkins Loan Program by providing greater flexibility in the process of assigning defaulted Perkins loans to the Secretary for collection. They are intended to address the large number of Perkins loan accounts that have been in default status for more than five years.
These regulations also allow State institutions participating in the Perkins Loan Program to invoke their right to sovereign immunity in bankruptcy proceedings and clarify the maximum collection costs that may be assessed to a borrower who defaults again on a previously rehabilitated defaulted loan.
These regulations are effective July 1, 2001.
Vanessa Freeman, Program Analyst, U.S. Department of Education, 400 Maryland Avenue, SW., Room 3045, Regional Office Building #3, Washington, DC 20202-5447. Telephone: (202) 708-8242. If you use a telecommunications device for the deaf (TDD), you may call the Federal Information Relay Service (FIRS) at 1-800-877-8339.
Individuals with disabilities may obtain this document in an alternative format (
On July 27, 2000, the Secretary published a notice of proposed rulemaking (NPRM) for the Federal Perkins Loan Program in the
The regulations in this document were developed through the use of negotiated rulemaking. Section 492 of the Higher Education Act requires that, before publishing any proposed regulations to implement programs under Title IV of the Act, the Secretary obtain public involvement in the development of the proposed regulations. After obtaining advice and recommendations, the Secretary must conduct a negotiated rulemaking process to develop the proposed regulations.
These regulations were published in proposed form on July 27, 2000, in conformance with the consensus of the negotiated rulemaking committee. Under the committee's protocols, consensus meant that no member of the committee dissented from the agreed-upon language. The Secretary invited comments on the proposed regulations by September 11, 2000 and 10 comments were received. An analysis of the comments follows.
We discuss substantive issues under the sections of the regulations to which they pertain. Generally, we do not address technical and other minor changes and suggested changes the law does not authorize the Secretary to make.
We have reviewed these final regulations in accordance with Executive Order 12866. Under the terms of the order we have assessed the potential costs and benefits of this regulatory action.
The potential costs associated with these final regulations are those resulting from statutory requirements and those we have determined as necessary for administering this program effectively and efficiently. Elsewhere in this
In assessing the potential costs and benefits—both quantitative and qualitative—of these final regulations, we have determined that the benefits would justify the costs.
We have also determined that these final regulations do not unduly interfere with State, local, and tribal governments in the exercise of their governmental functions.
We discussed the potential costs and benefits of these final regulations in the preamble to the NPRM (65 FR 46129). We include additional discussion of potential costs and benefits in the section of this preamble titled Analysis of Comments and Changes.
The Paperwork Reduction Act of 1995 does not require you to respond to a collection of information unless it displays a valid OMB control number. We display the valid OMB control numbers assigned to the collections of information in these final regulations at the end of the affected sections of the regulations.
In the NPRM we requested comments on whether the proposed regulation would require transmission of information that any other agency or authority of the United States gathers or makes available.
Based on the response to the NPRM and on our review, we have determined that these final regulations do not require transmission of information that any other agency or authority of the United States gathers or makes available.
You may view this document, as well as other Department of Education documents published in the
The official version of this document is the document published in the
Loan programs—education, Student aid, Reporting and recordkeeping requirements.
20 U.S.C. 1087aa-1087ii and 20 U.S.C. 421-429, unless otherwise noted.
(a) The Secretary may require an institution to reimburse its Fund in an amount equal to that portion of the outstanding balance of—
(c) Collection costs on a rehabilitated loan—
(1) If charged to the borrower, may not exceed 24 percent of the unpaid principal and accrued interest as of the date following application of the twelfth payment;
(2) That exceed the amounts specified in paragraph (c)(1) of this section, may be charged to an institution's Fund until July 1, 2002 in accordance with § 674.47(e)(5); and
(3) Are not restricted to 24 percent in the event the borrower defaults on the rehabilitated loan.
(b)
(1) In the case of a proceeding under chapter 7 of the Bankruptcy Code, the notice of meeting of creditors states that the borrower has no assets, or
(2) In the case of a bankruptcy proceeding under either Chapter 7 or Chapter 13 of the Bankruptcy Code in which the repayment plan proposes that the borrower repay less than the full amount owed on the loan, the institution has an authoritative determination by an appropriate State official that in the opinion of the State official, the institution is an agency of the State and is, on that basis, under applicable State law, immune from suit.
(c) The Secretary may require an institution to submit the following documents for any loan it proposes to assign—
Office of Postsecondary Education, Department of Education.
Final regulations.
The Secretary amends the Federal Family Education Loan (FFEL) Program regulations and the William D. Ford Federal Direct Loan (Direct Loan) Program regulations. These regulations are intended to reduce administrative burden for program participants, provide benefits to borrowers, and protect the taxpayers' interests.
For the FFEL Program, Mr. George Harris, or for the Direct Loan Program, Mr. Jon Utz; U.S. Department of Education, 400 Maryland Avenue, SW., room 3045, ROB-3, Washington, DC 20202-5449. Telephone: (202) 708-8242. If you use a telecommunications device for the deaf (TDD), you may call the Federal Information Relay Service (FIRS) at 1-800-877-8339.
Individuals with disabilities may obtain this document in an alternative format (e.g., Braille, large print, audiotape, or computer diskette) on request to the contact person listed under
The regulations in this document were developed through the use of negotiated rulemaking. Section 492 of the Higher Education Act of 1965, as amended (HEA), requires that, before publishing any proposed regulations to implement programs under Title IV of the HEA, the Secretary obtain public involvement in the development of the proposed regulations. After obtaining advice and recommendations, the Secretary must conduct a negotiated rulemaking process to develop the proposed regulations.
On July 27, 2000 the Secretary published a notice of proposed rulemaking (NPRM) for parts 682 and 685 in the
On August 10, 2000, the Secretary published another NPRM for parts 600, 668, 675, 682, 685, and 690 in the
In addition to minor technical revisions, these regulations contain a few significant changes from these two NPRMs that we fully explain in the Analysis of Comments and Changes that follows. The only significant comment we received concerning the changes to parts 682 and 685 proposed in the August 10, 2000 NPRM is reflected under our discussion related to 682.604(b).
We discuss substantive issues under the sections of the regulations to which they pertain. Generally, we do not address technical and other minor changes—and suggested changes the law does not authorize the Secretary to make.
We want to stress that the documentation required to support an application for a deferment with a begin
We do not agree with the commenter's suggestion that we should add a specific reference to the availability of the Department's Student Loan Ombudsman Office in this notice. Current regulations require a lender to notify the borrower of the availability of the Student Loan Ombudsman's Office as part of the lender's collection activity on a delinquent loan. In addition, under 34 CFR 682.410(b)(5)(vii), a guaranty agency is required to provide information on the availability of the Department's Student Loan Ombudsman Office if the borrower appeals an adverse decision resulting from the agency's administrative review of the borrower's loan obligation. We believe that these notices provide borrowers with sufficient notice of the opportunity to contact the Ombudsman's office. We do not believe that adding a reference to the Ombudsman's Office in the notice sent by the guaranty agency to the borrower under § 682.410(b)(6)(v) would improve this process. In fact, at this stage of the process it is most important for the borrower to be in contact with the guaranty agency directly. While the Ombudsman's Office may facilitate that communication in some cases, we believe it is better to encourage borrowers and their representatives to be directly in contact with the guaranty agency rather than to contact the Ombudsman's office.
In regard to the commenter's suggestion that the statement regarding the borrower's legal rights also be added to notices in the Direct Loan and Perkins programs, we note that the notices sent to borrowers in those programs are not the subject of these regulations. However, in collecting Direct loans that are in default, we generally follow the same or similar collection activities required of guaranty agencies under § 682.410(b). We will consider the commenter's suggestion when we revise the Direct Loan collection notices and when new regulations governing the Perkins Loan Program are developed.
(The following discussion relates to regulations included in the August 10, 2000 NPRM.)
The Paperwork Reduction Act of 1995 does not require you to respond to a collection of information unless it displays a valid OMB control number. Following OMB approval, we will display the valid OMB control numbers assigned to the collections of information in these final regulations at the end of the affected sections of the regulations.
We have reviewed these final regulations in accordance with Executive Order 12866. Under the terms of the order we have assessed the potential costs and benefits of this regulatory action.
The potential costs associated with the final regulations are those resulting from statutory requirements and those we have determined to be necessary for administering these programs effectively and efficiently.
In assessing the potential costs and benefits—both quantitative and qualitative—of these final regulations, we have determined that the benefits of the regulations justify the costs.
We have also determined that this regulatory action does not unduly interfere with State, local, and tribal governments in the exercise of their governmental functions.
In the NPRMs, we requested comments on whether the proposed regulations would require transmission of information that any other agency or authority of the United States gathers or makes available.
Based on the response to the NPRMs and our own review, we have determined that these final regulations do not require transmission of information that any other agency or authority of the United States gathers or makes available.
You may view this document, as well as other Department of Education documents published in the
You may also view this document in text or PDF at the following site:
The official version of this document is the document published in the
Administrative practice and procedure, Colleges and universities, Education, Loan programs—education, Reporting and recordkeeping requirements, Student aid, Vocational education.
20 U.S.C. 1071 to 1087-2, unless otherwise noted.
(b) * * *
(1) * * *
(vii) * * *
(F) The lender must retain a record of its basis for determining that extenuating circumstances existed. This record may include, but is not limited to, an updated credit report, a statement from the creditor that the borrower has made satisfactory arrangements to repay the debt, or a satisfactory statement from the borrower explaining any delinquencies with outstanding balances of less than $500.
(b)(1) * * *
(i) * * *
(B) Must disburse a Stafford or PLUS loan in accordance with the disbursement schedule provided by the school or any request made by the school modifying that schedule.
(vi) Except as provided in paragraph (f) of this section, may not disburse a second or subsequent disbursement of a Federal Stafford loan to a student who has ceased to be enrolled; and
(c) * * *
(3) Disbursement must be made on a payment period basis in accordance with the disbursement schedule provided by the school or any request made by the school modifying that schedule.
(a) * * *
(5) An authorized deferment period begins on the date that the holder determines is the date that the condition entitling the borrower to the deferment first existed, except that an initial unemployment deferment as described in paragraph (h)(2) of this section cannot begin more than 6 months before the date the holder receives a request and documentation required for the deferment.
(h) * * *
(2) * * *
(i) Describing the borrower's diligent search for full-time employment during
(s) * * *
(6) * * *
(iii) Is working full-time and has a monthly income that does not exceed the greater of (as calculated on a monthly basis)—
(A) The minimum wage rate described in section 6 of the Fair Labor Standards Act of 1938; or
(B) An amount equal to 100 percent of the poverty line for a family of two, as determined in accordance with section 673(2) of the Community Services Block Grant Act.
(iv) Is working full-time and has a Federal education debt burden that equals or exceeds 20 percent of the borrower's monthly income, and that income, minus the borrower's Federal education debt burden, is less than 220 percent of the amount described in paragraph (s)(6)(iii) of this section.
(v) Is not working full-time and has a monthly income that—
(A) Does not exceed twice the amount described in paragraph (s)(6)(iii) of this section; and
(B) After deducting an amount equal to the borrower's Federal education debt burden, the remaining amount of the borrower's income does not exceed the amount described in paragraph (s)(6)(iii) of this section.
(viii) For an initial period of deferment granted under paragraphs (s)(6)(iii) through (v) of this section, the lender must require the borrower to submit evidence showing the amount of the borrower's monthly income.
(ix) To qualify for a subsequent period of deferment that begins less than one year after the end of a period of deferment under paragraphs (s)(6)(iii) through (v) of this section, the lender must require the borrower to submit—
(A) Evidence showing the amount of the borrower's monthly income or a copy of the borrower's most recently filed Federal income tax return; and
(B) For periods of deferment under paragraphs (s)(6)(iv) and (v) of this section, evidence that would enable the lender to determine the amount of the monthly payments to all other entities for Federal postsecondary education loans that would have been owed by the borrower during the deferment period.
(x) For purposes of paragraph (s)(6) of this section, a borrower's monthly income is the gross amount of income received by the borrower from employment and from other sources, or one-twelfth of the borrower's adjusted gross income, as recorded on the borrower's most recently filed Federal income tax return.
(e) * * *
(3)
(13) * * *
(ii) * * *
(A) For periods of enrollment beginning prior to July 1, 1987, was determined to have the ability to benefit from the school's training in accordance with the requirements of 34 CFR 668.6, as in existence at the time the determination was made;
(B) For periods of enrollment beginning between July 1, 1987 and June 30, 1996, achieved a passing grade on a test—
(D) For periods of enrollment beginning on or after July 1, 1996 through June 30, 2000—
(
(
(E) For periods of enrollment beginning on or after July 1, 2000—
(
(
(iv) Notwithstanding paragraphs (e)(13)(i) and (ii) of this section, a student has the ability to benefit from the training offered by the school if the student received a high school diploma or its recognized equivalent prior to enrollment at the school.
(14)
(a) * * *
(11) The agency exercised due diligence in collection of the loan in accordance with § 682.410(b)(6).
(b) * * *
(6)
(i) A guaranty agency must engage in reasonable and documented collection activities on a loan on which it pays a default claim filed by a lender. For a non-paying borrower, the agency must perform at least one activity every 180 days to collect the debt, locate the borrower (if necessary), or determine if the borrower has the means to repay the debt.
(ii) A guaranty agency must attempt an annual Federal offset against all eligible borrowers. If an agency initiates proceedings to offset a borrower's State or Federal income tax refunds and other payments made by the Federal Government to the borrower, it may not initiate those proceedings sooner than 60 days after sending the notice described in paragraph (b)(5)(ii)(A) of this section.
(iii) A guaranty agency must initiate administrative wage garnishment proceedings against all eligible borrowers, except as provided in paragraph (b)(6)(iv) of this section, by following the procedures described in paragraph (b)(9) of this section.
(iv) A guaranty agency may file a civil suit against a borrower to compel repayment only if the borrower has no wages that can be garnished under paragraph (b)(9) of this section, or the agency determines that the borrower has sufficient attachable assets or income that is not subject to administrative wage garnishment that can be used to repay the debt, and the use of litigation would be more effective in collection of the debt.
(v) Within 45 days after paying a lender's default claim, the agency must send a notice to the borrower that contains the information described in paragraph (b)(5)(ii) of this section. During this time period, the agency also must notify the borrower, either in the notice containing the information described in paragraph (b)(5)(ii) of this section, or in a separate notice, that if he or she does not make repayment arrangements acceptable to the agency, the agency will promptly initiate procedures to collect the debt. The agency's notification to the borrower must state that the agency may administratively garnish the borrower's wages, file a civil suit to compel repayment, offset the borrower's State and Federal income tax refunds and other payments made by the Federal Government to the borrower, assign the loan to the Secretary in accordance with § 682.409, and take other lawful collection means to collect the debt, at the discretion of the agency. The agency's notification must include a statement that borrowers may have certain legal rights in the collection of debts, and that borrowers may wish to contact counselors or lawyers regarding those rights.
(vi) Within a reasonable time after all of the information described in paragraph (b)(6)(v) of this section has been sent, the agency must send at least one notice informing the borrower that the default has been reported to all national credit bureaus (if that is the case) and that the borrower's credit rating may thereby have been damaged.
(a) * * *
(2) A guaranty agency must retain the records required for each loan for not less than 3 years following the date the loan is repaid in full by the borrower, or for not less than 5 years following the date the agency receives payment in full from any other source. However, in particular cases, the Secretary may require the retention of records beyond these minimum periods.
(b) * * *
(2)(i) Except in the case of a late disbursement under paragraph (e) of this section or as provided in paragraph (b)(2)(iii) or (iv) of this section, a school may release the proceeds of any disbursement of a loan only to a student whom the school determines has maintained continuous eligibility in accordance with the provisions of § 682.201 for the loan period certified by the school on the student's loan application.
(c) * * *
(6) Unless the provision of § 682.207(d) or the provisions of paragraph (c)(7) of this section apply—
(i) If a loan period is more than one payment period, the school must deliver loan proceeds at least once in each payment period; and
(ii) If a loan period is one payment period, the school must make at least two deliveries of loan proceeds during that payment period. The school may not make the second delivery until the calendar midpoint between the first and last scheduled days of class of the loan period.
(7)(i) If a school measures academic progress in an educational program in
(A) The calendar midpoint between the first and last scheduled days of class of the loan period; or
(B) The date, as determined by the school, that the student has completed half of the academic coursework in the loan period.
(ii) For purposes of paragraph (c)(7) of this section, terms in a loan period are substantially equal in length if no term in the loan period is more than two weeks longer than any other term in that loan period.
20 U.S.C. 1087a
(c) * * *
(6)
(b) * * *
(5)(i) If a school measures academic progress in an educational program in credit hours and either does not use terms or does not use terms that are substantially equal in length for a loan period, the school may not make a second disbursement until the later of—
(A) The calendar midpoint between the first and last scheduled days of class of the loan period; or
(B) The date, as determined by the school, that the student has completed half of the academic coursework in the loan period.
(ii) For purposes of this paragraph, terms in a loan period are substantially equal in length if no term in the loan period is more than two weeks longer than any other term in that loan period.
Office of Postsecondary Education, Department of Education.
Final regulations.
The Secretary amends the Federal Family Education Loan (FFEL) Program and the William D. Ford Federal Direct Loan (Direct Loan) Program regulations. These final regulations implement changes made to the Higher Education Act of 1965, as amended, (HEA) by the Higher Education Amendments of 1998 (1998 Amendments). The final regulations implement the teacher loan forgiveness programs in the FFEL and Direct Loan programs that were included in the 1998 Amendments. In addition, these final regulations make conforming changes for both the FFEL Program and the Direct Loan Program, as well as unrelated technical amendments to the Direct Loan Program regulations.
These regulations are effective July 1, 2001.
For the FFEL Program, Ms. Beth Grebeldinger, or for the Direct Loan Program, Mr. Don Watson, U.S. Department of Education, 400 Maryland Avenue, SW., Room 3045, Regional Office Building #3, Washington, DC 20202-5346. Telephone: (202) 708-8242. If you use a telecommunications device for the deaf (TDD), you may call the Federal Information Relay Service (FIRS) at 1-800-877-8339.
Individuals with disabilities may obtain this document in an alternate format (e.g., Braille, large print, audiotape, or computer diskette) on request to one of the contact persons listed in the preceding paragraph.
These regulations implement certain changes made to the HEA by the 1998 Amendments (Pub.L. 105-244) that affect the FFEL and Direct Loan programs.
On August 10, 2000, the Secretary published a notice of proposed rulemaking (NPRM) for the FFEL and Direct Loan programs in the
In the preamble to the NPRM, on pages 49125 to 49127, the Secretary discussed the proposed regulations that would implement the teacher loan forgiveness program in the FFEL and Direct Loan programs. These include the following:
Amending §§ 682.211(h)(2) and (3), 682.215(e), 685.205(a)(5), and 685.205(b)(6) to allow some borrowers to request forbearance while performing qualifying teaching service, and during the submission and processing of their applications for teacher loan forgiveness.
Amending §§ 682.215(a), 685.212(h), and 685.217(a) to reflect sections 428J and 460 of the HEA, which established teacher loan forgiveness programs for certain borrowers in the FFEL Direct Loan programs.
Amending §§ 682.215(b) and 685.217(b) to provide specific definitions for the terms “academic year”, “elementary school”, “full-time”, “secondary school”, and “teacher” for purposes of the teacher loan forgiveness program.
Amending §§ 682.215(c) and 685.217(c) to provide that to qualify for the teacher loan forgiveness program a borrower must have been employed full-time for five consecutive complete years in a low-income elementary or secondary school that has been listed in a designated Department directory.
Amending §§ 682.215(d) and 685.217(d) to provide that $5,000 is the maximum amount that may be forgiven for an individual teacher under these programs.
Amending §§ 682.215(f) and 685.217(e) to explain the application process for both the borrower and the loan holder.
The regulations in this document were developed through the use of negotiated rulemaking. Section 492 of the HEA requires that, before publishing any proposed regulations to implement programs under Title IV of the HEA, the Secretary obtain public involvement in the development of the proposed regulations. After obtaining advice and recommendations, the Secretary must conduct a negotiated rulemaking process to develop the proposed regulations.
These regulations were published in proposed form on August 10, 2000, following completion of the negotiated rulemaking process. The Secretary invited comments on the proposed regulations by September 25, 2000. In response to the Secretary's invitation in the NPRM, 10 parties submitted comments on the proposed regulations. An analysis of the comments and of the changes in the regulations since publication of the NPRM follows.
We discuss substantive issues under the sections of the regulations to which they pertain. Generally, we do not address technical and other minor changes—and suggested changes the law does not authorize the Secretary to make.
Section 682.215(f)—Application and processing
We have reviewed these final regulations in accordance with Executive Order 12866. Under the terms of the order we have assessed the potential costs and benefits of this regulatory action.
The potential costs associated with the final regulations are those resulting from statutory requirements and those we have determined as necessary for administering these programs effectively and efficiently. Elsewhere in this
In assessing the potential costs and benefits—both quantitative and qualitative—of this regulatory action, we have determined that the benefits would justify the costs.
We have also determined that this regulatory action does not unduly interfere with State, local, and tribal governments in the exercise of their governmental functions.
We summarized the potential costs and benefits of these final regulations in the preamble to the NPRM (65 FR 49127).
The Paperwork Reduction Act of 1995 does not require you to respond to a
Based on the response to the NPRM and on our review, we have determined that these final regulations do not require transmission of information that any other agency or authority of the United States gathers or makes available.
You may view this document, as well as all other Department of Education documents published in the
The official version of this document is the document published in the
Administrative practice and procedure, Colleges and universities, Education, Loan programs-education, Reporting and recordkeeping requirements, Student aid, Vocational education.
For the reasons stated in the preamble, the Secretary amends title 34 of the Code of Federal Regulations by revising parts 682 and 685 as follows:
20 U.S.C. 1071 to 1087-2, unless otherwise noted.
The additions and revisions read as follows:
(h) * * *
(2) * * *
(ii) * * *
(C) Is performing the type of service that would qualify the borrower for loan forgiveness and associated forbearance under the requirements of the teacher loan forgiveness program in § 682.215.
(3) * * *
(iii) Before granting a forbearance to a borrower under paragraph (h)(2)(ii)(C) of this section, the lender must require the borrower to—
(A) Submit documentation for the period of the annual forbearance request showing the beginning and anticipated ending dates that the borrower is expected to perform, for that year, the type of service described in § 682.215(c); and
(B) Certify the borrower's intent to satisfy the requirements of § 682.215(c).
(a)
(b)
(c)
(i) Is in a school district that qualifies for funds under title I of the Elementary and Secondary Education Act of 1965, as amended;
(ii) Has been selected by the Secretary based on a determination that more than 30 percent of the school's total enrollment is made up of children who qualify for services provided under title I; and
(iii) Is listed in the
(2) If the school at which the borrower is employed meets the requirements specified in paragraph (c)(1) of this
(3) A borrower who is employed as an elementary school teacher must demonstrate knowledge and teaching skills in reading, writing, mathematics, and other areas of the elementary school curriculum, as certified by the chief administrative officer of the school in which the borrower was employed.
(4) A borrower who is employed as a secondary school teacher must teach in a subject area that is relevant to the borrower's academic major as certified by the chief administrative officer of the school in which the borrower was employed.
(5) The academic year may be counted as one of the borrower's five consecutive complete academic years if the borrower completes at least one-half of the academic year and the borrower's employer considers the borrower to have fulfilled his or her contract requirements for the academic year for the purposes of salary increases, tenure, and retirement if the borrower is unable to complete an academic year due to—
(i) A return to postsecondary education, on at least a half-time basis, that is directly related to the performance of the service described in this section;
(ii) A condition that is covered under the Family and Medical Leave Act of 1993 (FMLA) (19 U.S.C. 2654); or
(iii) A call or order to active duty status for more than 30 days as a member of a reserve component of the Armed Forces named in section 10101 of title 10, United States Code.
(6) A borrower's period of postsecondary education, qualifying FMLA condition, or military active duty as described in paragraph (c)(5) of this section, including the time necessary for the borrower to resume qualifying teaching no later than the beginning of the next regularly scheduled academic year, does not constitute a break in the required five consecutive years of qualifying teaching service.
(7) A borrower who taught in more than one qualifying school during an academic year and demonstrates that the combined teaching was the equivalent of full-time, as supported by the certification of one or more of the chief administrative officers of the schools involved, is considered to have completed one academic year of qualifying teaching.
(8) A borrower is not eligible for teacher loan forgiveness on a defaulted loan unless the borrower has made satisfactory repayment arrangements to re-establish title IV eligibility, as defined in § 682.200.
(9) A borrower may not receive loan forgiveness for qualifying teaching service under this section if the borrower receives a benefit for the same teaching service under subtitle D of title I of the National and Community Service Act of 1990.
(d)
(2) A borrower may not receive more than a total of $5,000 in loan forgiveness for outstanding principal and accrued interest under both this section and under section 34 CFR 685.217.
(3) The holder does not refund payments that were received from or on behalf of a borrower who qualifies for loan forgiveness under this section.
(e)
(i) Under § 682.211(h)(2)(ii)(C) and (h)(3)(iii), in annual increments for each of the years of qualifying teaching service, if the holder believes, at the time of each annual request, that the expected cancellation amount will satisfy the anticipated remaining outstanding balance on the loan at the time of the expected cancellation;
(ii) For a period not to exceed 60 days while the holder is awaiting a completed teacher loan forgiveness application from the borrower; and
(iii) For the period beginning on the date the holder receives a completed loan forgiveness application to the date the holder receives either a denial of the request or the loan discharge amount from the guaranty agency, in accordance with paragraph (f) of this section.
(2) At the conclusion of a forbearance authorized under paragraph (e)(1) of this section, the holder must resume collection activities and may capitalize any interest accrued and not paid during the forbearance period in accordance with § 682.202(b).
(3) Nothing in paragraph (e) of this section restricts holders from offering other forbearance options to borrowers who do not meet the requirements of paragraph (e)(1)(i) of this section.
(f)
(2)(i) The holder must file a request for payment with the guaranty agency on a teacher forgiveness discharge no later than 60 days after the receipt, from the borrower, of a completed teacher loan forgiveness application.
(ii) When filing a request for payment on a teacher forgiveness discharge, the holder must provide the guaranty agency with the completed loan forgiveness application submitted by the borrower and any required supporting documentation.
(iii) If the holder files a request for payment later than 60 days after the receipt of the completed teacher loan forgiveness application form, interest that accrued on the loan after the expiration of the 60-day filing period is ineligible for reimbursement by the Secretary, and the holder must repay all interest and special allowance received on the loan for periods after the expiration of the 60-day filing period. The holder cannot collect from the borrower any interest that is not paid by the Secretary under this paragraph.
(3)(i) Within 45 days of receiving the holder's request for payment, the guaranty agency must determine if the borrower meets the eligibility requirements for loan forgiveness under this section and must notify the holder of its determination of the borrower's eligibility for loan forgiveness under this section.
(ii) If the guaranty agency approves the discharge, it must, within the same 45-day period, pay the holder the amount of the discharge, up to $5,000, subject to paragraphs (c)(9), (d)(1) and (d)(2) of this section.
(4) After being notified by the guaranty agency of its determination of the eligibility of the borrower for the discharge, the holder must, within 30 days, inform the borrower of the determination. If the discharge is approved, the holder must also provide the borrower with information regarding any new repayment terms of remaining loan balances.
(5) Unless otherwise instructed by the borrower, the holder must apply the proceeds of the teacher forgiveness discharge first to any outstanding
(g)
20 U.S.C. 1087a
The additions read as follows:
(a) * * *
(5) The borrower—
(i) Is performing the type of service that would qualify the borrower for loan forgiveness under the requirements of the teacher loan forgiveness program in § 685.217; and
(ii) Is required, by the Secretary, before a forbearance is granted under § 685.205(a)(5)(i) to—
(A) Submit documentation for the period of the annual forbearance request showing the beginning and ending dates that the borrower is expected to perform, for that year, the type of service described in § 685.217(c); and
(B) Certify the borrower's intent to satisfy the requirements of § 685.217(c).
(b) * * *
(6) * * *
(iv) Under § 685.217; or
The addition reads as follows:
(h)
(a)
(b)
(c)
(i) Is in a school district that qualifies for funds under title I of the Elementary and Secondary Education Act of 1965, as amended;
(ii) Has been selected by the Secretary based on a determination that more than 30 percent of the school's total enrollment is made up of children who qualify for services provided under title I; and
(iii) Is listed in the
(2) If the school at which the borrower is employed meets the requirements specified in paragraph (c)(1) of this section for at least one year of the borrower's five consecutive complete academic years of teaching and the school failed to meet those requirements in subsequent years, those subsequent years of teaching qualify for purposes of this section for that borrower.
(3) A borrower who is employed as an elementary school teacher must demonstrate knowledge and teaching skills in reading, writing, mathematics, and other areas of the elementary school curriculum, as certified by the chief administrative officer of the school in which the borrower was employed.
(4) A borrower who is employed as a secondary school teacher must teach in a subject area that is relevant to the borrower's academic major as certified by the chief administrative officer of the school in which the borrower was employed.
(5) The academic year may be counted as one of the borrower's five consecutive complete academic years if the borrower completes at least one-half of the academic year and the borrower's employer considers the borrower to have fulfilled his or her contract requirements for the academic year for the purposes of salary increases, tenure, and retirement if the borrower is unable to complete an academic year due to—
(i) A return to postsecondary education, on at least a half-time basis, that is directly related to the performance of the service described in this section;
(ii) A condition that is covered under the Family and Medical Leave Act of 1993 (FMLA) (19 U.S.C. 2654); or
(iii) A call or order to active duty status for more than 30 days as a member of a reserve component of the Armed Forces named in section 10101 of title 10, United States Code.
(6) If a borrower meets the requirements of paragraph (c)(5) of this section, the borrower's period of postsecondary education, active duty, or qualifying FMLA condition including the time necessary for the borrower to resume qualifying teaching no later than the beginning of the next regularly scheduled academic year, does not constitute a break in the required five consecutive years of qualifying teaching service.
(7) A borrower who teaches in more than one qualifying school during an academic year and demonstrates that the combined teaching was the equivalent of full-time, as supported by the certification of one or more of the chief administrative officers of the schools involved, is considered to have completed one academic year of qualifying teaching.
(8) A borrower is not eligible for teacher loan forgiveness on a defaulted loan unless the borrower has made satisfactory repayment arrangements to re-establish title IV eligibility, as defined in § 685.200(b).
(9) A borrower may not receive loan forgiveness for qualifying teaching service under this section if the borrower receives a benefit for the same teaching service under subtitle D of title I of the National and Community Service Act of 1990.
(d)
(2) A borrower may not receive more than a total of $5,000 in loan forgiveness for outstanding principal and accrued interest under both this section and 34 CFR § 682.215.
(3) The Secretary does not refund payments that were received from or on behalf of a borrower who qualifies for loan forgiveness under this section.
(e)
(2) If the Secretary determines that the borrower meets the eligibility requirements for loan forgiveness under this section, the Secretary—
(i) Notifies the borrower of this determination; and
(ii) Unless otherwise instructed by the borrower, applies the proceeds of the loan forgiveness first to any outstanding Direct Unsubsidized Loan balances, next to any outstanding Direct Subsidized Loan balances, next to any qualifying Direct Unsubsidized Consolidation Loan balances, and last to any qualifying outstanding Direct Subsidized Consolidation Loan balances.
(3) If the Secretary determines that the borrower does not meet the eligibility requirements for loan forgiveness under this section, the Secretary notifies the borrower of this determination.
Office of Postsecondary Education, Department of Education.
Final regulations.
The Secretary amends the Student Assistance General Provisions, Federal Family Education Loan (FFEL) Program, William D. Ford Federal Direct Loan (Direct Loan) Program, and Federal Pell Grant Program regulations. In these final regulations, the requirements for the loan default reduction and prevention measures are moved to a new subpart and revised for clarity and consistency. The Secretary also makes various substantive changes to these requirements.
These regulations are effective July 1, 2001.
Kenneth Smith, U.S. Department of Education, 400 Maryland Avenue, SW., ROB-3, room 3045, Washington, DC 20202-5447. Telephone: (202) 708-8242. If you use a telecommunications device for the deaf (TDD), you may call the Federal Information Relay Service (FIRS) at 1-800-877-8339.
Individuals with disabilities may obtain this document in an alternative format (e.g., Braille, large print, audiotape, or computer diskette) on request to the contact person listed in the preceding paragraph.
On August 2, 2000, we published a notice of proposed rulemaking (NPRM) for the Student Assistance General Provisions, FFEL Program, Direct Loan Program, and Federal Pell Grant Program in the
• Moving the regulations governing the calculation of cohort default rates and challenges to those rates that were in previous § 668.17 to a new subpart M of part 668, revising the regulations for clarity and consistency, and removing Appendix D to part 668.
• In § 668.184, providing detailed regulations for determining an institution's cohort default rate after certain types of institutional restructuring.
• In §§ 668.185(c) and 668.195, amending certain regulations for a participation rate index challenge or appeal.
• In § 668.187(a)(1), imposing a loss of participation from the FFEL and Direct Loan programs against an institution having a cohort default rate greater than 40 percent, without requiring the use of a proceeding under subpart G of part 668.
• In § 668.187(a)(2), imposing a loss of participation in the FFEL Program against an institution with three consecutive cohort default rates of 25 percent or greater, even if Direct Loans are included in those cohort default rates, without the use of a proceeding under subpart G of part 668.
• In § 668.188, providing for the application of an institution's loss of eligibility to a related or successor institution when certain criteria are met, to prevent an institution from evading the consequences of cohort default rates.
• In § 668.192, allowing an institution that is provisionally certified under § 668.16(m) to submit an erroneous data appeal.
• In § 668.193, allowing all institutions to appeal their most recent cohort default rates on the basis of improper loan servicing or collection.
• In § 668.194, restoring certain eligibility criteria, inadvertently omitted in previous regulations, and revising submission requirements for an economically disadvantaged appeal.
• In § 668.196, providing for the submission of an average rates appeal by an institution that is subject to loss of participation based on a cohort default rate greater than 40 percent.
• In § 668.197, providing for the submission of a thirty-or-fewer borrowers appeal by an institution that is subject to loss of participation based on a cohort default rate greater than 40 percent.
• In § 668.198, exempting a special institution that is in compliance with this section from a loss of eligibility based on a cohort default rate greater than 40 percent.
These final regulations contain several significant changes from the NPRM. We fully explain these changes in the Analysis of Comments and Changes elsewhere in this preamble.
These final regulations will be a new subpart M of part 668 of the Department's regulations. This new subpart is a reorganization of provisions governing the cohort default rate calculation and challenge process, which are currently in 34 CFR 668.17. As discussed elsewhere in this preamble, a few of these provisions have also been revised. Generally, these changes do not affect procedural or substantive rights of any party. However, there are a few instances in which those rights have been modified. To the extent that an institution has or had a right or obligation under § 668.17 before the effective date of these regulations, the institution's exercise or failure to exercise that right or meet that obligation is binding after the effective date of these regulations. These final regulations govern all rights and obligations that may apply to an institution or other party after their effective date.
The regulations in this document were developed through the use of negotiated rulemaking. Section 492 of the Higher Education Act of 1965, as amended (HEA) requires that, before publishing any proposed regulations to implement programs under Title IV of the HEA, the Secretary obtain public involvement in the development of the proposed regulations. After obtaining advice and recommendations, the Secretary must conduct a negotiated rulemaking process to develop the proposed regulations.
These regulations were published in proposed form on August 2, 2000, following the completion of the negotiated rulemaking process. The Secretary invited comments on the proposed regulations by September 18, 2000, and 17 comments were received. An analysis of the comments and of the changes in the regulations since publication of the NPRM follows.
We discuss substantive issues under the sections of the regulations to which they pertain. Generally, we do not address technical and other minor changes and suggested changes the law does not authorize the Secretary to make.
However, one commenter questioned whether the change from calendar days to working days would allow institutions less time to comply with the regulations. Another commenter recommended that the regulations define “days” as “working days” because it would allow institutions more time to submit requests and appeals during the cohort default rate process. This commenter stated that requiring an institution to submit a completed appeal within 30 calendar days may place an undue burden on institutions that are also trying to perform the other administrative functions required for participation in the Title IV, HEA programs.
We do not agree that the term “days” should mean “working days” in subpart M of part 668. We also do not agree that it is unreasonable to require an institution to submit a completed appeal within 30 calendar days. In fact, it is our experience that almost every institution meets the deadline.
Proposed § 668.182(f)(2)(i) stated that a Federal SLS loan is considered to enter repayment at the same time as the borrower's Federal Stafford loan enters repayment, if the borrower received a Federal Stafford loan for the same loan period. The commenter noted that 34 CFR 682.200 and 682.209(a)(2)(iii) do not require that the borrower receive the Federal SLS and Federal Stafford loans for the same loan period. Instead, under those sections, the Federal SLS and Federal Stafford loans must be obtained during the same period of continuous enrollment, which may include one or more loan periods, for the Federal SLS loan to enter repayment at the same time as the Federal Stafford loan.
In addition, under proposed § 668.182(f)(2)(ii), for all other purposes, a Federal SLS loan would be considered to enter repayment on the day after the student ceased to be enrolled at the institution on at least a half-time basis in an educational program leading to a degree, certificate, or other recognized educational credential. The commenter stated that loans do not enter repayment because a student ceases to be enrolled at least half-time at a particular institution; they enter repayment because the student ceases to be enrolled at least half-time. A student might continue his or her studies at another institution, and the loans would not enter repayment until the student ceased to be enrolled at least half-time at that second institution.
One commenter agreed that these regulations are appropriate and stated that degree-granting institutions with historically low default rates should not be subject to this regulatory provision. Seven commenters argued that these regulations are inappropriate. They claimed that these regulations unfairly target non-degree-granting proprietary institutions. Several commenters argued that if these requirements are appropriate for non-degree-granting proprietary institutions, then they should be appropriate for, and applied to, all types of institutions.
The commenters believed that there is not a significant risk that an institution could have a low cohort default rate even though a large proportion of its former students are making only minimal or no payments under the income contingent repayment plan. They did not believe that this risk is an adequate reason for the special
The commenters also argued that this provision is contrary to the purpose of the Direct Loan Program's income contingent repayment plan. They contended that this repayment plan was designed to help students repay their loans, even if the students are starting new careers or are unable to work full time, and that this repayment plan is a legitimate option for all eligible borrowers.
We also continue to believe that this provision should apply only to non-degree-granting proprietary institutions. As we stated in the preamble to the NPRM, our experience and data show that student borrowers at non-degree-granting proprietary institutions are at a higher risk of default than other student borrowers. The cohort default rates of non-degree-granting proprietary institutions are, on average, consistently higher than those of other institutions. Since non-degree-granting proprietary institutions provide students with education or training needed to secure employment, a borrower's ability to make substantial payments on a loan reflects the value of the education or training provided by the institution in the marketplace.
We had intended for § 668.183(c)(2)(ii) to address situations in which a lender repurchases a loan, before the end of the fiscal year immediately following the fiscal year in which it entered repayment, having recognized that the lender's claim for insurance on the loan was submitted or paid in error. In those situations, the loan is not considered to be in default.
The application of one of these sections to an institution does not preclude the application of the other section to that same institution based on the same circumstance. The sections are separate requirements. A determination of an institution's cohort default rate under § 668.184 does not preclude the application of a loss of eligibility under § 668.188, and the application of a loss of eligibility under § 668.188 does not preclude the determination of an institution's cohort default rate under § 668.184.
Four commenters felt that this statement was an overly broad interpretation of the regulatory criterion, and they asked us to revise our interpretation in this preamble. Some commenters contended that this interpretation would be impossible to apply consistently, because it would require an extensive analysis of the population served by the institutions. The commenters also noted that the statement in the preamble to the NPRM could be read to suggest that we will treat institutions that are located miles apart as being located at “substantially the same address.” Three commenters stated that, as distance learning becomes more accepted for all or parts of a program, any school that uses computerized instruction over the internet could be considered to be serving the same population.
The commenters argued that “substantially the same address” should refer to the same building, an adjacent building, the same block, across the street, etc. They stated that these were the examples offered during negotiated rulemaking, to gain consensus for this requirement, and that the consensus achieved during negotiated rulemaking did not include the broad interpretation they believed was reflected in the preamble to the NPRM.
For example, after Institution A becomes ineligible to participate in the FFEL and Direct Loan programs, its owner changes Institution A's name to Institution B and moves it 10 blocks away from Institution A's site. Institutions A and B are located in a small city, where no other institutions provide the same type of educational programs, and they serve the same population of students. One week after Institution A becomes ineligible, Institution B opens for business with the same owner and staff. Under the interpretation that the commenters suggest, Institution A's prior loss of eligibility would not be applied to Institution B because their sites are located 10 blocks apart rather than in adjacent buildings, on the same block, across the street, etc.
This result does not serve the goals of section 435(m)(3) of the HEA, which these regulations are intended to implement. In the example, Institution B was created from Institution A merely by changing the name and location. The institutions are owned by the same person, and since they are located in a small city, they provided the same educational programs to the same population of students. It is clear that the change in status was instituted in order to evade the consequences of Institution A's cohort default rates, and also that Institution A is continuing to function as Institution B. In this case, limiting the interpretation of “substantially the same address” to the specific locations the commenters mention would only prompt the owner to locate Institution B at least one building beyond that narrowly-defined area. It would not prevent Institution B from evading the consequences of Institution A's cohort default rates.
During the negotiated rulemaking discussions, we did not intend to limit the interpretation of this provision to a specific geographical area. If we had intended to create a narrowly-defined rule, we would have defined that geographical area specifically in the regulatory language, rather than using the more general term, “substantially the same address.” The statement included in the preamble to the NPRM was intended to provide an explanation of the circumstances under which that term could extend further than a narrowly-defined geographical area.
We recognize that this approach may result in some uncertainty among institutions contemplating various changes in status. For this reason, a procedure is included in these regulations for institutions to make inquiries to us. If an institution is undergoing a change in institutional structure or identity and is unsure whether its site is located at “substantially the same address” as another institution's site, it may contact us for an initial determination under § 668.188(d).
The word “should” was added to § 668.189(e)(2) during negotiations. Non-Federal negotiators asked us to change proposed language, which provided that the data “must be in a format acceptable to us,” to “should be in a format acceptable to us.” They made this request so the requirement for data managers would be less rigid and more similar to requirements for institutions, under § 668.189(c), which state that we “may” (instead of “will”) deny an institution's request for adjustment or appeal if it does not meet certain requirements.
On further consideration, however, we have determined that changing the language did not make the provisions similar, since an institution risks the denial of its appeal if its request is not in an acceptable format. In contrast, a guaranty agency would not be subject to
However, we did not make all of the changes that the commenters suggested:
• Instead of removing the information associated with the draft cohort default rate process from the first table and adding a separate table for that information, we have specified within the first table that sanctions are never based on draft cohort default rates.
• We have not included page numbers with citations. It would be impossible to keep the page numbers updated so that they would always identify the text as it is first printed in the
• We have not re-ordered the columns in the second table so that challenges, adjustments, and appeals are presented in the order of their appearance in the regulations. When printed in the
• We have not included definitions of the terms “you”, “we”, and “data manager” in Appendix A. This appendix will be published in the Code of Federal Regulations as part of subpart M of part 668. It will not be separated from this subpart by other regulations or appendices, so there is no need to repeat these definitions.
• Instead of explaining in the second table the reason that a school would not receive a loan record detail report with its cohort default rate, we have included this information as an example in the introductory language for the table. There is no space in the table to insert this explanation.
We have reviewed these final regulations in accordance with Executive Order 12866. Under the terms of the order we have assessed the potential costs and benefits of this regulatory action.
The potential costs associated with the final regulations are those resulting from statutory requirements and those we have determined to be necessary for administering these programs effectively and efficiently.
In assessing the potential costs and benefits—both quantitative and qualitative—of these final regulations, we have determined that the benefits of the regulations justify the costs.
We have also determined that this regulatory action does not unduly interfere with State, local, and tribal governments in the exercise of their governmental functions.
We summarized the potential costs and benefits of these final regulations in the preamble to the NPRM (65 FR 47590).
The Paperwork Reduction Act of 1995 does not require you to respond to a collection of information unless it displays a valid Office of Management and Budget (OMB) control number. We display the valid OMB control number assigned to the collection of information in these final regulations at the end of the affected sections of the regulations.
The Federal Supplemental Educational Opportunity Grant Program and the Leveraging Educational Assistance Partnership are subject to Executive Order 12372 and the regulations in 34 CFR part 79. One of the objectives of the Executive order is to foster an intergovernmental partnership and a strengthened federalism by relying on processes developed by State and local governments for coordination and review of proposed Federal financial assistance.
In accordance with the order, we intend this document to provide early notification of our specific plans and actions for these programs.
The Federal Family Education Loan, Federal Supplemental Loans for
In the NPRM we requested comments on whether the proposed regulations would require transmission of information that any other agency or authority of the United States gathers or makes available.
Based on the response to the NPRM and on our review, we have determined that these final regulations do not require transmission of information that any other agency or authority of the United States gathers or makes available.
You may view this document in text or Adobe Portable Document Format (PDF) on the Internet at the following sites:
The official version of this document is the document published in the
(Catalog of Federal Domestic Assistance Numbers: 84.007 Federal Supplemental Educational Opportunity Grant Program; 84.032 Federal Family Education Loan Program; 84.032 Federal PLUS Program; 84.032 Federal Supplemental Loans for Students Program; 84.033 Federal Work-Study Program; 84.038 Federal Perkins Loan Program; 84.063 Federal Pell Grant Program; 84.069 Leveraging Educational Assistance Partnership; and 84.268 William D. Ford Federal Direct Loan Program)
Administrative practice and procedure, Colleges and universities, Consumer protection, Education, Grant programs—education, Loan programs—education, Reporting and recordkeeping requirements, Student aid, Vocational education.
Administrative practice and procedure, Colleges and universities, Loan programs—education, Reporting and recordkeeping requirements, Student aid, Vocational education.
Colleges and universities, Education of disadvantaged, Grant programs—education, Reporting and recordkeeping requirements, Student aid.
20 U.S.C. 1001, 1002, 1003, 1085, 1088, 1091, 1092, 1094, 1099c, and 1099c-1, unless otherwise noted.
(m) * * *
(2)(i) However, if the Secretary determines that an institution's administrative capability is impaired solely because the institution fails to comply with paragraph (m)(1) of this section, the Secretary allows the institution to continue to participate in the Title IV, HEA programs but may provisionally certify the institution in accordance with § 668.13(c); and
(ii) The institution may appeal the loss of full participation in a Title IV, HEA program under paragraph (m)(1) of this section by submitting an erroneous data appeal in writing to the Secretary in accordance with and on the grounds specified in subpart M of this part;
(b) * * *
(1) * * *
(ii) Specifies the proposed effective date of the suspension, which is at least 20 days after the date of mailing of the notice of intent;
(b) * * *
(1) * * *
(ii) Specifies the proposed effective date of the limitation or termination, which is at least 20 days after the date of mailing of the notice of intent;
Your cohort default rate is a measure we use to determine your eligibility to participate in various Title IV, HEA programs. We may also use it for determining your eligibility for exemptions, such as those for certain disbursement requirements under the FFEL and Direct Loan Programs. This subpart describes how cohort default rates are calculated, some of the consequences of cohort default rates, and how you may request changes to your cohort default rates or appeal their consequences. Under this subpart, you submit a “challenge” after you receive your draft cohort default rate, and you request an “adjustment” or “appeal” after your official cohort default rate is published.
We use the following definitions in this subpart:
(a)
(b)
(2) For FFELP loans that we hold, we are the data manager.
(3) For Direct Loan Program loans, the Direct Loan Servicer, as defined in 34 CFR 685.102, is the data manager.
(c)
(d)
(e)
(f)
(2) A Federal SLS loan is considered to enter repayment—
(i) At the same time the borrower's Federal Stafford loan enters repayment, if the borrower received the Federal SLS loan and the Federal Stafford loan during the same period of continuous enrollment; or
(ii) In all other cases, on the day after the student ceases to be enrolled at an institution on at least a half-time basis in an educational program leading to a degree, certificate, or other recognized educational credential.
(3) For the purposes of this subpart, a loan is considered to enter repayment on the date that a borrower repays it in full, if the loan is paid in full before the loan enters repayment under paragraphs (f)(1) or (f)(2) of this section.
(g)
(h)
(i)
(j)
(k)
(a)
(1) First, under paragraph (b) of this section, we identify the borrowers in your cohort for the fiscal year. If the total number of borrowers in that cohort is fewer than 30, we also identify the borrowers in your cohorts for the 2 most recent prior fiscal years.
(2) Second, under paragraph (c) of this section, we identify the borrowers in the cohort (or cohorts) who are considered to be in default. If more than one cohort will be used to calculate your cohort default rate, we identify defaulted borrowers separately for each cohort.
(3) Third, under paragraph (d) of this section, we calculate your cohort default rate.
(4) Fourth, we apply your cohort default rate to all of your locations—
(i) As you exist on the date you receive the notice of your official cohort default rate; and
(ii) From the date on which you receive the notice of your official cohort default rate until you receive our notice that the cohort default rate no longer applies.
(b)
(2) A borrower may be included in more than one of your cohorts and may be included in the cohorts of more than one institution in the same fiscal year.
(c)
(i) Before the end of the following fiscal year, the borrower defaults on any FFELP loan that was used to include the borrower in the cohort or on any Federal Consolidation Loan Program loan that repaid a loan that was used to include the borrower in the cohort (however, a borrower is not considered to be in default unless a claim for insurance has been paid on the loan by a guaranty agency or by us);
(ii) Before the end of the following fiscal year, the borrower fails to make an installment payment, when due, on any Direct Loan Program loan that was used to include the borrower in the cohort or on any Federal Direct Consolidation Loan Program loan that repaid a loan that was used to include the borrower in the cohort, and the borrower's failure persists for 360 days (or for 270 days, if the borrower's first day of delinquency was before October 7, 1998);
(iii) You are a proprietary, non-degree-granting institution, and before the end of the following fiscal year, the borrower has been in repayment for 360 days, under the Direct Loan Program's income contingent repayment plan, on a loan used to include the borrower in your cohort (or that repaid a loan that was used to include the borrower in your cohort), with scheduled payments that are less than 15 dollars per month and are less than the amount of interest accruing on the loan; or
(iv) Before the end of the following fiscal year, you or your owner, agent, contractor, employee, or any other affiliated entity or individual make a payment to prevent a borrower's default on a loan that is used to include the borrower in that cohort.
(2) A borrower is not considered to be in default based on a loan that is, before the end of the fiscal year immediately following the fiscal year in which it entered repayment—
(i) Rehabilitated under 34 CFR 682.405 or 34 CFR 685.211(e); or
(ii) Repurchased by a lender because the claim for insurance was submitted or paid in error.
(d)
(1) Thirty or more borrowers in your cohort for a fiscal year, your cohort default rate is the percentage that is derived by dividing—
(i) The number of borrowers in the cohort who are in default, as determined under paragraph (c) of this section; by (ii) The number of borrowers in the cohort, as determined under paragraph (b) of this section.
(2) Fewer than 30 borrowers in your cohort for a fiscal year, your cohort default rate is the percentage that is derived by dividing—
(i) The total number of borrowers in that cohort and in the two most recent prior cohorts who are in default, as determined for each cohort under paragraph (c) of this section; by
(ii) The total number of borrowers in that cohort and the two most recent prior cohorts, as determined for each cohort under paragraph (b) of this section.
(a)
(2) In determining cohort default rates under this section, the date of a merger, acquisition, or other change in status is the date the change occurs.
(3) A change in status may affect your eligibility to participate in Title IV, HEA programs under § 668.187 or § 668.188.
(4) If another institution's cohort default rate is applicable to you under this section, you may challenge, request an adjustment, or submit an appeal for the cohort default rate under the same requirements that would be applicable to the other institution under §§ 668.185 and 668.189.
(b)
(1) For the cohort default rates published before the date of the acquisition or merger, your cohort default rates are the same as those of your predecessor that had the highest total number of borrowers entering repayment in the two most recent cohorts used to calculate those cohort default rates; and
(2) Beginning with the first cohort default rate published after the date of the acquisition or merger, your cohort default rates are determined by including the applicable borrowers from each institution involved in the acquisition or merger in the calculation under § 668.183.
(c)
(1) The cohort default rates published for you before the date of the change apply to you and to the newly acquired branch or location;
(2) Beginning with the first cohort default rate published after the date of the change, your cohort default rates for the next 3 fiscal years are determined by including the applicable borrowers from your institution and the other institution (including all of its locations) in the calculation under § 668.183;
(3) After the period described in paragraph (c)(2) of this section, your cohort default rates do not include borrowers from the other institution in the calculation under § 668.183; and
(4) At all times, the cohort default rate for the institution from which you acquired the branch or location is not affected by this change in status.
(d)
(1) The cohort default rates published before the date of the change for your former parent institution are also applicable to you;
(2) Beginning with the first cohort default rate published after the date of the change, your cohort default rates for the next 3 fiscal years are determined by including the applicable borrowers from your institution and your former parent institution (including all of its locations) in the calculation under § 668.183; and
(3) After the period described in paragraph (d)(2) of this section, your cohort default rates do not include borrowers from your former parent institution in the calculation under § 668.183.
(a)
(2) Regardless of the number of borrowers included in your cohort, your
(3) Your draft cohort default rate and the loan record detail report are not considered public information and may not be otherwise voluntarily released by a data manager.
(4) Any challenge you submit under this section and any response provided by a data manager must be in a format acceptable to us. This acceptable format is described in the “Cohort Default Rate Guide” that we provide to you. If your challenge does not comply with the requirements in the “Cohort Default Rate Guide,” we may deny your challenge.
(b)
(i) A description of the information in the loan record detail report that you believe is incorrect; and
(ii) Documentation that supports your contention that the data are incorrect.
(2) Within 30 days after receiving your challenge, the data manager must send you and us a response that—
(i) Addresses each of your allegations of error; and
(ii) Includes the documentation that supports the data manager's position.
(3) If your data manager concludes that draft data in the loan record detail report are incorrect, and we agree, we use the corrected data to calculate your cohort default rate.
(4) If you fail to challenge the accuracy of data under this section, you cannot contest the accuracy of those data in an uncorrected data adjustment, under § 668.190, or in an erroneous data appeal, under § 668.192.
(c)
(ii) You may challenge an anticipated loss of eligibility under § 668.187(a)(2), based on three cohort default rates of 25 percent or greater, if your participation rate index is equal to or less than 0.0375 for any of those three cohorts' fiscal years.
(2) For a participation rate index challenge, your participation rate index is calculated as described in § 668.195(b), except that—
(i) The draft cohort default rate is considered to be your most recent cohort default rate; and
(ii) If the cohort used to calculate your draft cohort default rate included fewer than 30 borrowers, you may calculate your participation rate index for that fiscal year using either your most recent draft cohort default rate or the average rate that would be calculated for that fiscal year, using the method described in § 668.183(d)(2).
(3) You must send your participation rate index challenge, including all supporting documentation, to us within 45 days after you receive your draft cohort default rate.
(4) We notify you of our determination on your participation rate index challenge before your official cohort default rate is published.
(5) If we determine that you qualify for continued eligibility based on your participation rate index challenge, you will not lose eligibility under § 668.187 when your next official cohort default rate is published. A successful challenge that is based on your draft cohort default rate does not excuse you from any other loss of eligibility. However, if your successful challenge of a loss of eligibility under paragraph (c)(1)(ii) of this section is based on a prior, official cohort default rate, and not on your draft cohort default rate, we also excuse you from any subsequent loss of eligibility, under § 668.187(a)(2), that would be based on that official cohort default rate.
(a) We notify you of your cohort default rate after we calculate it. After we send our notice to you, we publish a list of cohort default rates for all institutions.
(b) If your cohort default rate is 10 percent or more, we include a copy of the loan record detail report with the notice.
(c) If your cohort default rate is less than 10 percent—
(1) You may request a copy of any loan record detail report that lists loans included in your cohort default rate calculation; and
(2) If you are requesting an adjustment or appealing under this subpart, your request for a copy of the loan record detail report or reports must be sent to us within 15 days after you receive the notice of your cohort default rate.
(a)
(2) Except as provided in paragraphs (e) and (f) of this section, you lose your eligibility to participate in the FFEL, Direct Loan, and Federal Pell Grant programs 30 days after you receive our notice that your three most recent cohort default rates are each 25 percent or greater.
(b)
(1) For the remainder of the fiscal year in which we notify you that you are subject to a loss of eligibility; and
(2) For the next 2 fiscal years.
(c)
(1) Any concurrent or subsequent loss of eligibility under this section; or
(2) Any other action by us.
(d)
(e)
(1) Were ineligible to participate in the FFEL and Direct Loan programs before October 7, 1998, and your eligibility was not reinstated;
(2) Requested in writing, before October 7, 1998, to withdraw your participation in the FFEL and Direct Loan programs, and you were not later reinstated; or
(3) Have not certified an FFELP loan or originated a Direct Loan Program loan on or after July 7, 1998.
(f)
(2) Eligibility continued under paragraph (f)(1) of this section ends if we determine that none of the requests for adjustments and appeals you have submitted qualify you for continued eligibility under § 668.189. Loss of eligibility takes effect on the date that you receive notice of our determination on your last pending request for adjustment or appeal.
(3) You do not lose eligibility under this section if we determine that your request for adjustment or appeal meets all requirements of this subpart and qualifies you for continued eligibility under § 668.189.
(4) To avoid liabilities you might otherwise incur under paragraph (g) of this section, you may choose to suspend your participation in the FFEL and Direct Loan programs during the adjustment or appeal process.
(g)
(1) For any FFEL or Direct Loan Program loan that you certified and delivered or originated and disbursed more than 30 days after you received the notice of your cohort default rate, we estimate the amount of interest, special allowance, reinsurance, and any related or similar payments we make or are obligated to make on those loans;
(2) We exclude from this estimate any amount attributable to funds that you delivered or disbursed more than 45 days after you submitted your completed appeal to us;
(3) We notify you of the estimated amount; and
(4) Within 45 days after you receive our notice of the estimated amount, you must pay us that amount, unless—
(i) You file an appeal under the procedures established in subpart H of this part (for the purposes of subpart H of this part, our notice of the estimate is considered to be a final program review determination); or
(ii) We permit a longer repayment period.
(h)
(1) The period described in paragraph (b) of this section has ended;
(2) You pay any amount owed to us under this section or are meeting that obligation under an agreement acceptable to us;
(3) You submit a new application for participation in the program;
(4) We determine that you meet all of the participation requirements in effect at the time of your application; and
(5) You and we enter into a new program participation agreement.
(a)
(1) You and the ineligible institution are both parties to a transaction that results in a change of ownership, a change in control, a merger, a consolidation, an acquisition, a change of name, a change of address, any change that results in a location becoming a freestanding institution, a purchase or sale, a transfer of assets, an assignment, a change of identification number, a contract for services, an addition or closure of one or more locations or branches or educational programs, or any other change in whole or in part in institutional structure or identity;
(2) Following the change described in paragraph (a)(1) of this section, you offer an educational program at substantially the same address at which the ineligible institution had offered an educational program before the change; and
(3) There is a commonality of ownership or management between you and the ineligible institution, as the ineligible institution existed before the change.
(b)
(1) Holds or held a managerial role; or
(2) Has or had the ability to affect substantially the institution's actions, within the meaning of 34 CFR 600.21.
(c)
(1)(i) Within 60 days after the change described in this section, you send us the names of the managers for each facility undergoing the teach-out as it existed before the change and for each facility as it exists after you believe that the commonality of management has ended; and
(ii) We determine that the commonality of management, as described in paragraph (b)(1) of this section, has ended; or
(2)(i) Within 30 days after you receive our notice that we have denied your submission under paragraph (c)(1)(i) of this section, you make the management changes we request and send us a list of the names of the managers for each facility undergoing the teach-out as it exists after you make those changes; and
(ii) We determine that the commonality of management, as described in paragraph (b)(1) of this section, has ended.
(d)
(e)
(2) Our notice also advises you of the scope and duration of your loss of eligibility. The loss of eligibility applies to all of your locations from the date you receive our notice until the expiration of the period of ineligibility applicable to the other institution.
(3) If you are subject to a loss of eligibility under this section that has already been imposed against another institution, you may only request an adjustment or submit an appeal for the loss of eligibility under the same requirements that would be applicable to the other institution under § 668.189.
(a)
(1) We recalculate your cohort default rate, and it is below the percentage
(i) An uncorrected data adjustment submitted under this section and § 668.190;
(ii) A new data adjustment submitted under this section and § 668.191;
(iii) An erroneous data appeal submitted under this section and § 668.192; or
(iv) A loan servicing appeal submitted under this section and § 668.193; or
(2) You meet the requirements for—
(i) An economically disadvantaged appeal submitted under this section and § 668.194;
(ii) A participation rate index appeal submitted under this section and § 668.195;
(iii) An average rates appeal submitted under this section and § 668.196; or
(iv) A thirty-or-fewer borrowers appeal submitted under this section and § 668.197.
(b)
(2) You may not request an adjustment or appeal a cohort default rate, under § 668.190, § 668.191, § 668.192, or § 668.193, more than once.
(3) You may not request an adjustment or appeal a cohort default rate, under § 668.190, § 668.191, § 668.192, or § 668.193, if you previously lost your eligibility to participate in a Title IV, HEA program, under § 668.187, based entirely or partially on that cohort default rate.
(c)
(1) All appeals, notices, requests, independent auditor's opinions, management's written assertions, and other correspondence that you are required to send under this subpart must be complete, timely, accurate, and in a format acceptable to us. This acceptable format is described in the “Cohort Default Rate Guide” that we provide to you.
(2) Your completed request for adjustment or appeal must include—
(i) All of the information necessary to substantiate your request for adjustment or appeal; and
(ii) A certification by your chief executive officer, under penalty of perjury, that all the information you provide is true and correct.
(d)
(e)
(2) If a data manager sends us correspondence under this subpart that is not in a format acceptable to us, we may require the data manager to revise that correspondence's format, and we may prescribe a format for that data manager's subsequent correspondence with us.
(f)
(2) In making our decision for an adjustment, under § 668.190 or § 668.191, or an appeal, under § 668.192 or § 668.193—
(i) We presume that the information provided to you by a data manager is correct unless you provide substantial evidence that shows the information is not correct; and
(ii) If we determine that a data manager did not provide the necessary clarifying information or legible records in meeting the requirements of this subpart, we presume that the evidence that you provide to us is correct unless it is contradicted or otherwise proven to be incorrect by information we maintain.
(3) Our decision is based on the materials you submit under this subpart. We do not provide an oral hearing.
(4) We notify you of our decision—
(i) If you request an adjustment or appeal because you are subject to a loss of eligibility under § 668.187, within 45 days after we receive your completed request for an adjustment or appeal; or
(ii) In all other cases, except for appeals submitted under § 668.192(a) to avoid provisional certification, before we notify you of your next official cohort default rate.
(5) You may not seek judicial review of our determination of a cohort default rate until we issue our decision on all pending requests for adjustments or appeals for that cohort default rate.
(a)
(b)
(2) You must send us a request for an uncorrected data adjustment, including all supporting documentation, within 30 days after you receive your loan record detail report from us.
(c)
(1) In response to your challenge under § 668.185(b), a data manager agreed to change the data;
(2) The changes described in paragraph (c)(1) of this section are not reflected in your official cohort default rate; and
(3) We agree that the data are incorrect.
(a)
(1) A comparison of the loan record detail reports that we provide to you for the draft and official cohort default rates shows that the data have been newly included, excluded, or otherwise changed; and
(2) You identify errors in the data described in paragraph (a)(1) of this section that are confirmed by the data manager.
(b)
(2) You must send the relevant data manager, or data managers, and us a request for a new data adjustment,
(3) Within 20 days after receiving your request for a new data adjustment, the data manager must send you and us a response that—
(i) Addresses each of your allegations of error; and
(ii) Includes the documentation used to support the data manager's position.
(4) Within 15 days after receiving a guaranty agency's notice that we hold an FFELP loan about which you are inquiring, you must send us your request for a new data adjustment for that loan. We respond to your request under paragraph (b)(3) of this section.
(5) Within 15 days after receiving incomplete or illegible records or data from a data manager, you must send a request for replacement records or clarification of data to the data manager and us.
(6) Within 20 days after receiving your request for replacement records or clarification of data, the data manager must—
(i) Replace the missing or illegible records;
(ii) Provide clarifying information; or
(iii) Notify you and us that no clarifying information or additional or improved records are available.
(7) You must send us your completed request for a new data adjustment, including all supporting documentation—
(i) Within 30 days after you receive the final data manager's response to your request or requests; or
(ii) If you are also filing an erroneous data appeal or a loan servicing appeal, by the latest of the filing dates required in paragraph (b)(7)(i) of this section or in § 668.192(b)(6)(i) or § 668.193(c)(10)(i).
(c)
(a)
(1) You dispute the accuracy of data that you previously challenged on the basis of incorrect data, under § 668.185(b); or
(2) A comparison of the loan record detail reports that we provide to you for the draft and official cohort default rates shows that the data have been newly included, excluded, or otherwise changed, and you dispute the accuracy of that data.
(b)
(2) Within 20 days after receiving your request for verification of data errors, the data manager must send you and us a response that—
(i) Addresses each of your allegations of error; and
(ii) Includes the documentation used to support the data manager's position.
(3) Within 15 days after receiving a guaranty agency's notice that we hold an FFELP loan about which you are inquiring, you must send us your request for verification of that loan's data errors. Your request must include a description of the information in the cohort default rate data that you believe is incorrect and all supporting documentation that demonstrates the error. We respond to your request under paragraph (b)(2) of this section.
(4) Within 15 days after receiving incomplete or illegible records or data, you must send a request for replacement records or clarification of data to the data manager and us.
(5) Within 20 days after receiving your request for replacement records or clarification of data, the data manager must—
(i) Replace the missing or illegible records;
(ii) Provide clarifying information; or
(iii) Notify you and us that no clarifying information or additional or improved records are available.
(6) You must send your completed appeal to us, including all supporting documentation—
(i) Within 30 days after you receive the final data manager's response to your request; or
(ii) If you are also requesting a new data adjustment or filing a loan servicing appeal, by the latest of the filing dates required in paragraph (b)(6)(i) of this section or in § 668.191(b)(7)(i) or § 668.193(c)(10)(i).
(c)
(a)
(1) Your most recent cohort default rate; or
(2) Any cohort default rate upon which a loss of eligibility under § 668.187 is based.
(b)
(1) Send at least one letter (other than the final demand letter) urging the borrower to make payments on the loan;
(2) Attempt at least one phone call to the borrower;
(3) Send a final demand letter to the borrower;
(4) For a Direct Loan Program loan only, document that skip tracing was performed if the Direct Loan Servicer determined that it did not have the borrower's current address; and
(5) For an FFELP loan only—
(i) Submit a request for preclaims or default aversion assistance to the guaranty agency; and
(ii) Submit a certification or other documentation that skip tracing was performed to the guaranty agency.
(c)
(2) You must send a request for loan servicing records to the relevant data manager, or data managers, and to us within 15 days after you receive your loan record detail report from us. If the data manager is a guaranty agency, your request must include a copy of the loan record detail report.
(3) Within 20 days after receiving your request for loan servicing records, the data manager must—
(i) Send you and us a list of the borrowers in your representative
(ii) Send you and us a description of how your representative sample was chosen; and
(iii) Either send you copies of the loan servicing records for the borrowers in your representative sample and send us a copy of its cover letter indicating that the records were sent, or send you and us a notice of the amount of its fee for providing copies of the loan servicing records.
(4) The data manager may charge you a reasonable fee for providing copies of loan servicing records, but it may not charge more than $10 per borrower file. If a data manager charges a fee, it is not required to send the documents to you until it receives your payment of the fee.
(5) If the data manager charges a fee for providing copies of loan servicing records, you must send payment in full to the data manager within 15 days after you receive the notice of the fee.
(6) If the data manager charges a fee for providing copies of loan servicing records, and—
(i) You pay the fee in full and on time, the data manager must send you, within 20 days after it receives your payment, a copy of all loan servicing records for each loan in your representative sample (the copies are provided to you in hard copy format unless the data manager and you agree that another format may be used), and it must send us a copy of its cover letter indicating that the records were sent; or
(ii) You do not pay the fee in full and on time, the data manager must notify you and us of your failure to pay the fee and that you have waived your right to challenge the calculation of your cohort default rate based on the data manager's records. We accept that determination unless you prove that it is incorrect.
(7) Within 15 days after receiving a guaranty agency's notice that we hold an FFELP loan about which you are inquiring, you must send us your request for the loan servicing records for that loan. We respond to your request under paragraph (c)(3) of this section.
(8) Within 15 days after receiving incomplete or illegible records, you must send a request for replacement records to the data manager and us.
(9) Within 20 days after receiving your request for replacement records, the data manager must either—
(i) Replace the missing or illegible records; or
(ii) Notify you and us that no additional or improved copies are available.
(10) You must send your appeal to us, including all supporting documentation—
(i) Within 30 days after you receive the final data manager's response to your request for loan servicing records; or
(ii) If you are also requesting a new data adjustment or filing an erroneous data appeal, by the latest of the filing dates required in paragraph (c)(10)(i) of this section or in § 668.191(b)(7)(i) or § 668.192(b)(6)(i).
(d)
(2) From the group of borrowers identified under paragraph (d)(1) of this section, the data manager identifies a sample that is large enough to derive an estimate, acceptable at a 95 percent confidence level with a plus or minus 5 percent confidence interval, for use in determining the number of borrowers who should be excluded from the calculation of the cohort default rate due to improper loan servicing or collection.
(e)
(1) Provided to the guaranty agency by the lender and used by the guaranty agency in determining whether to pay a claim on a defaulted loan; or
(2) Maintained by our Direct Loan Servicer that are used in determining your cohort default rate.
(f)
(2) Based on our determination, we use a statistically valid methodology to exclude the corresponding percentage of borrowers from both the numerator and denominator of the calculation of your cohort default rate.
(3) Our recalculation of your cohort default rate does not affect the number of borrowers who are considered to be in default due to payments made under the Direct Loan Program's income contingent repayment plan, under the criteria in § 668.183(c)(1)(iii).
(a)
(1) You offer an associate, baccalaureate, graduate, or professional degree, and your completion rate is 70 percent or more; or
(2) You do not offer an associate, baccalaureate, graduate, or professional degree, and your placement rate is 44 percent or more.
(b)
(i) For an award year that overlaps the 12-month period selected under paragraph (b)(2) of this section, have an expected family contribution, as defined in 34 CFR 690.2, that is equal to or less than the largest expected family contribution that would allow a student to receive one-half of the maximum Federal Pell Grant award, regardless of the student's enrollment status or cost of attendance; or
(ii) For a calendar year that overlaps the 12-month period selected under paragraph (b)(2) of this section, have an adjusted gross income that, when added to the adjusted gross income of the student's parents (if the student is a dependent student) or spouse (if the student is a married independent student), is less than the amount listed in the Department of Health and Human Services poverty guidelines for the size of the student's family unit.
(2) The students who are used to determine your low income rate include only students who were enrolled on at least a half-time basis in an eligible program at your institution during any part of a 12-month period that ended during the 6 months immediately preceding the cohort's fiscal year.
(c)
(i) Completed the educational programs in which they were enrolled;
(ii) Transferred from your institution to a higher level educational program;
(iii) Remained enrolled and are making satisfactory progress toward completion of their educational programs at the end of the same 12-month period used to calculate the low income rate; or
(iv) Entered active duty in the Armed Forces of the United States within 1 year after their last date of attendance at your institution.
(2) The students who are used to determine your completion rate include only regular students who were—
(i) Initially enrolled on a full-time basis in an eligible program; and
(ii) Originally scheduled to complete their programs during the same 12-month period used to calculate the low income rate.
(d)
(i) Are employed, in an occupation for which you provided training, on the date following 1 year after their last date of attendance at your institution;
(ii) Were employed for at least 13 weeks, in an occupation for which you provided training, between the date they enrolled at your institution and the first date that is more than a year after their last date of attendance at your institution; or
(iii) Entered active duty in the Armed Forces of the United States within 1 year after their last date of attendance at your institution.
(2) For the purposes of this section, a former student is not considered to have been employed based on any employment by your institution.
(3) The students who are used to determine your placement rate include only former students who—
(i) Were initially enrolled in an eligible program on at least a half-time basis;
(ii) Were originally scheduled, at the time of enrollment, to complete their educational programs during the same 12-month period used to calculate the low income rate; and
(iii) Remained in the program beyond the point at which a student would have received a 100 percent tuition refund from you.
(4) A student is not included in the calculation of your placement rate if that student, on the date that is 1 year after the student's originally scheduled completion date, remains enrolled in the same program and is making satisfactory progress.
(e)
(1) For a student who is initially enrolled full-time, the amount of time specified in your enrollment contract, catalog, or other materials for completion of the program by a full-time student; or
(2) For a student who is initially enrolled less than full-time, the amount of time that it would take the student to complete the program if the student remained at that level of enrollment throughout the program.
(f)
(2) Within 60 days after you receive the notice of your loss of eligibility, you must send us the independent auditor's opinion described in paragraph (g) of this section.
(g)
(2) The engagement that forms the basis of the independent auditor's opinion must be an examination-level compliance attestation engagement performed in accordance with—
(i) The American Institute of Certified Public Accountant's (AICPA) Statement on Standards for Attestation Engagements, Compliance Attestation (AICPA, Professional Standards, vol. 1, AT sec. 500), as amended (these standards may be obtained by calling the AICPA's order department, at 1-888-777-7077); and
(ii) Government Auditing Standards issued by the Comptroller General of the United States.
(h)
(1) Your independent auditor's opinion agrees that you meet the requirements for an economically disadvantaged appeal; and
(2) We determine that the independent auditor's opinion and your management's written assertion—
(i) Meet the requirements for an economically disadvantaged appeal; and
(ii) Are not contradicted or otherwise proven to be incorrect by information we maintain, to an extent that would render the independent auditor's opinion unacceptable.
(a)
(2) You may appeal a notice of a loss of eligibility under § 668.187(a)(2), based on three cohort default rates of 25 percent or greater, if your participation rate index is equal to or less than 0.0375 for any of those three cohorts' fiscal years.
(b)
(i) The number of students who received an FFELP or a Direct Loan Program loan to attend your institution during a period of enrollment, as defined in 34 CFR 682.200 or 685.102, that overlaps any part of a 12-month period that ended during the 6 months immediately preceding the cohort's fiscal year, by
(ii) The number of regular students who were enrolled at your institution on at least a half-time basis during any part of the same 12-month period.
(2) If your cohort default rate for a fiscal year is calculated as an average rate under § 668.183(d)(2), you may calculate your participation rate index for that fiscal year using either that average rate or the cohort default rate that would be calculated for the fiscal year alone using the method described in § 668.183(d)(1).
(c)
(d)
(2) If we determine that your participation rate index for a fiscal year is equal to or less than 0.0375, under paragraph (d)(1) of this section, we also excuse you from any subsequent loss of eligibility under § 668.187(a)(2) that would be based on the official cohort default rate for that fiscal year.
(a)
(2) You may appeal a notice of a loss of eligibility under § 668.187(a)(2), based on three cohort default rates of 25 percent or greater, if at least two of those cohort default rates—
(i) Are calculated as average rates under § 668.183(d)(2); and
(ii) Would be less than 25 percent if calculated for the fiscal year alone using the method described in § 668.183(d)(1).
(b)
(2) If you disagree with our initial determination, you must send us your average rates appeal, including all supporting documentation, within 30 days after you receive the notice of your loss of eligibility.
(c)
(a)
(b)
(2) If you disagree with our initial determination, you must send us your thirty-or-fewer borrowers appeal, including all supporting documentation, within 30 days after you receive the notice of your loss of eligibility.
(c)
(a)
(1) Historically black college or university as defined in section 322(2) of the HEA;
(2) Tribally controlled community college as defined in section 2(a)(4) of the Tribally Controlled Community College Assistance Act of 1978; or
(3) Navajo community college under the Navajo Community College Act.
(b)
(1) By July 1 of the first 1-year period that begins after you receive our notice of a loss of eligibility under § 668.187—
(i) A default management plan; and
(ii) A certification that you have engaged an independent third party, as described in this section; and
(2) By July 1 of each subsequent 1-year period—
(i) Evidence that you have implemented your default management plan during the preceding 1-year period;
(ii) Evidence that you have made substantial improvement in the preceding 1-year period in your cohort default rate; and
(iii) A certification that you continue to engage an independent third party, as described in this section.
(c)
(i) Establishing a default management team by engaging your chief executive officer and relevant senior executive officials and enlisting the support of representatives from offices other than the financial aid office;
(ii) Identifying and allocating the personnel, administrative, and financial resources appropriate to implement the default management plan;
(iii) Defining the roles and responsibilities of the independent third party;
(iv) Defining evaluation methods and establishing a data collection system for measuring and verifying relevant default management statistics, including a statistical analysis of the borrowers who default on their loans;
(v) Establishing annual targets for reductions in your cohort default rate; and
(vi) Establishing a process to ensure the accuracy of your cohort default rate.
(2) We will determine whether your default management plan is acceptable, after considering your history, resources, dollars in default, and targets for default reduction in making this determination.
(3) If we determine that your proposed default management plan is unacceptable, you must consult with us to develop a revised plan and submit the revised plan to us within 30 days after you receive our notice that your proposed plan is unacceptable.
(4) If we determine, based on the evidence you submit under paragraph (b)(2) of this section, that your default management plan is no longer acceptable, you must develop a revised plan in consultation with us and submit the revised plan to us within 60 days after you receive our notice that your plan is no longer acceptable.
(5) A sample default management plan is provided in appendix B to this subpart. The sample is included to illustrate components of an acceptable default management plan. Since institutions' family income profiles, student borrowing patterns, histories, resources, dollars in default, and targets for default reduction are different, you must consider your own, individual circumstances in developing and submitting your plan.
(d)
(i) Provides technical assistance in developing and implementing your default management plan; and
(ii) Is not substantially controlled by a person who also exercises substantial control over your institution.
(2) An independent third party need not be paid by you for its services.
(3) The services of a lender, guaranty agency, or secondary market as an independent third party under this
(e)
(i) A reduction in your most recent draft or official cohort default rate;
(ii) An increase in the percentage of delinquent borrowers who avoid default by using deferments, forbearances, and job placement assistance;
(iii) An increase in the academic persistence of student borrowers;
(iv) An increase in the percentage of students pursuing graduate or professional study;
(v) An increase in the percentage of borrowers for whom a current address is known;
(vi) An increase in the percentage of delinquent borrowers that you contacted;
(vii) The implementation of alternative financial aid award policies and development of financial resources that reduce the need for student borrowing; or (viii) An increase in the percentage of accurate and timely enrollment status changes that you submitted to the National Student Loan Data System (NSLDS) on the Student Status Confirmation Report (SSCR).
(2) When making a determination of your substantial improvement, we consider your performance in light of—
(i) Your history, resources, dollars in default, and targets for default reduction;
(ii) Your level of effort in meeting the terms of your approved default management plan during the previous 1-year period; and
(iii) Any other mitigating circumstance at your institution during the 1-year period.
(f)
(2) If we determine that you are not in compliance with this section, you are subject to the provisions of §§ 668.187 and 668.16(m). You lose your eligibility to participate in the FFEL, Direct Loan, and Federal Pell Grant programs on the date you receive our notice of the determination.
Some types of appeals may be submitted only if you are subject to a loss of eligibility under § 668.187 or to provisional certification under § 668.16(m). These types of appeals are identified in the following table. Submission deadlines are described in the paragraphs and sections that are cited in the table. For example, although you may submit an uncorrected data adjustment, new data adjustment, or loan servicing appeal if you are subject to provisional certification, the deadlines for those submissions are based on the date you receive your cohort default rate, not the date you receive the notice of your provisional certification.
1.
2.
(i) For
(ii) For
3.
(i) If you
(ii) If you
This appendix is provided as a sample plan for those institutions developing a default management plan in accordance with § 668.198. It describes some measures you may find helpful in reducing the number of students that default on federally funded loans. These are not the only measures you could implement when developing a default management plan. In developing a default management plan, you must consider your history, resources, dollars in default, and targets for default reduction to determine which activities will result in the most benefit to your students and to you.
1. Establish a default management team by engaging your chief executive officer and relevant senior executive officials and enlisting the support of representatives from offices other than the financial aid office.
2. Identify and allocate the personnel, administrative, and financial resources appropriate to implement the default management plan.
3. Define the roles and responsibilities of the independent third party.
4. Define evaluation methods and establish a data collection system for measuring and verifying relevant default management statistics, including a statistical analysis of the borrowers who default on their loans.
5. Establish annual targets for reductions in your rate.
6. Establish a process to ensure the accuracy of your rate.
1. Enhance the borrower's understanding of his or her loan repayment responsibilities through counseling and debt management activities.
2. Enhance the enrollment retention and academic persistence of borrowers through counseling and academic assistance.
3. Maintain contact with the borrower after he or she leaves your institution by using activities such as skip tracing to locate the borrower.
4. Track the borrower's delinquency status by obtaining reports from data managers and FFEL Program lenders.
5. Enhance student loan repayments through counseling the borrower on loan repayment options and facilitating contact between the borrower and the data manager or FFEL Program lender.
6. Assist a borrower who is experiencing difficulty in finding employment through career counseling, job placement assistance, and facilitating unemployment deferments.
7. Identify and implement alternative financial aid award policies and develop alternative financial resources that will reduce the need for student borrowing in the first 2 years of academic study.
8. Familiarize the parent, or other adult relative or guardian, with the student's debt profile, repayment obligations, and loan status by increasing, whenever possible, the communication and contact with the parent or adult relative or guardian.
1. Specifically define the role of the independent third party.
2. Specify the scope of work to be performed by the independent third party.
3. Tie the receipt of payments, if required, to the performance of specific tasks.
4. Assure that all the required work is satisfactorily completed.
1. The number of students enrolled at your institution during each fiscal year.
2. The average amount borrowed by a student each fiscal year.
3. The number of borrowers scheduled to enter repayment each fiscal year.
4. The number of enrolled borrowers who received default prevention counseling services each fiscal year.
5. The average number of contacts that you or your agent had with a borrower who was in deferment or forbearance or in repayment status during each fiscal year.
6. The number of borrowers at least 60 days delinquent each fiscal year.
7. The number of borrowers who defaulted in each fiscal year.
8. The type, frequency, and results of activities performed in accordance with the default management plan.
20 U.S.C. 1071 to 1087-2, unless otherwise noted.
(b) * * *
(15)
(c) * * *
(1) * * *
(i) * * *
(C) Each participating school, located in a State for which the guaranty agency is the principal guaranty agency, that has a cohort default rate, as described in subpart M of 34 CFR part 668, for either of the 2 immediately preceding fiscal years, as defined in 34 CFR 668.182, that exceeds 20 percent, unless the school is under a mandate from the Secretary under subpart M of 34 CFR part 668 to take specific default reduction measures or if the total dollar amount of loans entering repayment in each fiscal year on which the cohort default rate over 20 percent is based does not exceed $100,000; or
20 U.S.C. 1087a
20 U.S.C. 1070a, unless otherwise noted.
Environmental Protection Agency (EPA).
Proposed Rule.
EPA is proposing to clarify that PCB waste in United States' territories and possessions outside the customs territory of the United States may be returned to the U.S. Customs Territory for proper disposal. This proposed rule interprets the prohibition on the manufacture of PCBs at Section 6(e) of the Toxic Substances Control Act (TSCA) to allow the movement of PCB waste among any States of the United States for the purpose of disposal, and that such movement is not considered “import.” This interpretation will allow U.S. territories and possessions which fall outside of the definition of “customs territory of the United States” to dispose of their PCB waste in the mainland of the United States where facilities are available that can properly dispose of PCB waste. Thus, this rule would ensure that a safe and viable mechanism exists for the protection of health and the environment for those citizens in areas of the United States where facilities are not available for the proper management and disposal of PCB waste. Because disposal of these wastes may occur only at approved facilities, no unreasonable risks to health or the environment on the mainland United States will be created by this rule.
Comments, identified by the docket number OPPTS-66020, must be received by EPA on or before December 1, 2000.
Comments may be submitted by mail, electronically, or in person. Please follow the detailed instructions for each method as provided in Unit I. of the
For general information contact: Barbara Cunningham, Acting Director, Environmental Assistance Division, Office of Pollution Prevention and Toxics (7408), Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460; telephone numbers: 202-554-1404; e-mail address:
For technical information contact: Peggy Reynolds, OPPT/NPCD, 7404, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460; telephone number: 202-260-3965; fax number: 202-260-1724; e-mail address:
You may be potentially affected by this action if you are in a United States territory or possession outside of the customs territory of the United States, and you manufacture, process, distribute in commerce, or use PCBs. Examples of such territories and possessions are Guam, American Samoa, the Commonwealth of the Northern Mariana Islands (CNMI) including Saipan, and the United States Virgin Islands. Potentially affected entities may include, but are not limited to:
This listing is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be affected by this action. Other types of entities not listed above could also be affected. The North American Industrial Classification System (NAICS) codes have been provided to assist you and others in determining whether or not this action might apply to certain entities. To determine whether you or your business may be affected by this action, you should carefully examine the applicability provisions in 40 CFR part 761. If you have any questions regarding the applicability of this action to a particular entity, consult the technical person listed in the
1.
Information about the Office of Prevention, Pesticides and Toxic Substances (OPPTS) and OPPTS related programs is available from
2.
You may submit comments through the mail, in person, or electronically. To ensure proper receipt by EPA, it is imperative that you identify docket control number OPPTS-66020 in the subject line on the first page of your response.
1.
2.
3.
Do not submit any information electronically that you consider to be CBI. You may claim information that you submit to EPA in response to this document as CBI by marking any part or all of that information as CBI. Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2. In addition to one complete version of the comment that includes any information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public version of the official record. Information not marked confidential will be included in the public version of the official record without prior notice. If you have any questions about CBI or the procedures for claiming CBI, please consult the technical person identified in the
EPA proposes to amend the disposal regulations at 40 CFR 761.99 to allow certain PCB waste located anywhere in the United States, including the territories and possessions of the United States that are not inside the customs territory of the United States (hereafter “territories and possessions”), to be moved to any area within the United States for disposal. The proposed rule would clarify that such movement is not considered “import” for purposes of the ban on manufacturing PCBs under TSCA section 6(e)(3).
EPA is taking this action to clarify its interpretation of the TSCA provisions relating to the manufacture of PCBs as an exercise of the agency's inherent authority to issue regulations interpreting the statutes it administers. This proposed regulation would codify EPA's interpretation of an undefined term, “import” in the definition of “manufacture” under section 3(7) of TSCA, for purposes of section 6(e)(3) of TSCA. EPA's definition of the term “import” for all other purposes under TSCA is not affected.
PCBs cause significant ecological and human health effects, including cancer, neurotoxicity, reproductive and developmental toxicity, immune system suppression, liver damage, skin irritation, and endocrine disruption (Ref. 1). EPA has found that any exposure of humans or the environment to PCBs may be significant, depending on such factors as the quantity of PCBs involved in the exposure, the likelihood of exposure to humans and the environment, and the effect of exposure (40 CFR 761.20). PCBs are readily absorbed through the skin and at even faster rates when inhaled. Because PCBs are stored in animal fatty tissue, humans are also exposed to PCBs through ingestion of animal products. Significantly, bioaccumulated PCBs appear to be even more toxic than those found in the ambient environment, since the more toxic PCB congeners are more persistent and thus more likely to be retained (Ref. 1).
Under section 6(e) of the Toxic Substances Control Act (TSCA), 15 U.S.C. 2605(e), and implementing regulations at 40 CFR part 761, the manufacture, processing, and distribution in commerce of PCBs are banned unless EPA issues a regulatory exemption to the ban. The ban on manufacture of PCBs was designed to prevent the creation or introduction to the United States of new PCBs, and it has been largely successful. Use of PCBs is banned except in a totally enclosed manner or as authorized by rule based on a finding that the use will not pose an unreasonable risk to human health or the environment. Disposal of PCBs is strictly controlled to minimize release to the environment. By enacting TSCA section 6(e), Congress established a presumption that PCBs pose an unreasonable risk of injury to health and the environment.
Before the statutory ban was enacted in 1976, PCBs were widely used in industrial applications, particularly as insulating fluids in electrical equipment. Utilities and other industries lawfully manufactured and sold items such as PCB electrical equipment and hydraulic or heat transfer equipment. After TSCA's general bans on manufacture, processing, distribution in commerce, and use of such items went into effect, EPA authorized the continued use of much of this equipment subject to conditions that protect against an unreasonable risk to health or the environment from the PCBs in the equipment. As these items reach the end of their useful lives, the owners are responsible for disposing of them following the stringent requirements of 40 CFR part 761. Any PCBs that are released from the equipment also must
TSCA was enacted to protect all of the citizens of the United States from unreasonable risk of injury to health or the environment from exposure to chemical substances. TSCA sections 3(13) and 3(14) define “United States” to include “any State of the United States, the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, Guam, the Canal Zone, American Samoa, the Northern Mariana Islands, or any other territory or possession of the United States.” Thus, the prohibitions and restrictions on PCBs under TSCA section 6(e) and its implementing regulations protect not only United States citizens in the 50 States, but United States citizens in all the territories and possessions of the United States. PCBs in the 50 States and in the territories and possessions must be managed and disposed of in a manner that does not present an unreasonable risk to health or the environment.
PCBs and PCB waste in the territories and possessions pose an especially great environmental threat. The territories and possessions have no permitted commercial PCB disposal facilities, so PCB waste is accumulated in long-term storage. Many of the territories and possessions are subject to frequent typhoons and earthquakes, which can severely damage storage areas and other buildings. PCBs and PCB waste in storage therefore may present a greater risk to human health and the environment than PCBs stored in the mainland United States (Ref. 8).
Between 1945 and 1990, within 180 nautical miles of Guam, there were 118 tropical storms (wind speed 40 to 72 mph), 36 typhoons (wind speed 75 to 149 mph), and 8 super-typhoons (wind speed 150 mph or more). Between 1973 and 2000, Guam has seen an average of 18 earthquakes a year within a 100 kilometer radius. During the last 10 years, 12 earthquakes of magnitude 5 or higher have occurred within a 50 kilometer radius of Guam. The Commonwealth of the Northern Marianas Islands is 120 miles from Guam and shares similar geologic characteristics, so the risks would be similar (Ref. 8).
The Samoas lie squarely within the South Pacific's notorious cyclone belt. In American Samoa, Cyclone Tusi caused extensive damage to property, vegetation, and wildlife in 1987. Cyclones occur, on average, every 10 to 15 years, but in the early 1990s, the Samoas were devastated by two of the strongest and most destructive storms on record. Cyclone Ofa struck in February, 1990, bringing winds of up to 250 kilometers per hour, killing 16 people and leveling much of the island of Savai'i. In 1991, Cyclone Val pummeled the islands for 5 days with winds up to 260 kilometers per hour and waves of up to 25 meters in height. Although the storm destroyed nearly three times as much as its predecessor, the death toll was the same. Total damage was estimated at $380 million (Ref. 8).
PCBs that are released to the environment in the territories and possessions, through natural disasters or other events, can present significant exposure risks to residents of these areas. Many island residents consume fish for subsistence, and PCBs bioaccumulate in fish. In addition, island natural resources are severely limited and therefore vulnerable. Even a small quantity of PCBs seeping into the groundwater system could permanently eliminate an island's only source of clean drinking water (Ref. 8).
Disposal of PCBs in the territories and possessions presents a special challenge. Most PCBs that are regulated for disposal must be disposed of in a TSCA-approved facility, such as an incinerator or a chemical waste landfill (40 CFR part 761, subpart D). However, as noted above, there are no TSCA-approved commercial PCB disposal facilities in any of the territories or possessions of the United States (Ref. 6), so disposal in the territory or possession where the waste is generated is not possible in most cases. A recent survey of the status of PCB waste in the territories and possessions shows that, because of the lack of disposal options, PCB wastes have been placed in storage awaiting disposal in facilities that are not approved commercial storage facilities under TSCA. In some cases, spills or releases from these facilities are inadequately controlled, presenting risks to health and the environment (Ref. 8).
The territories and possessions cannot dispose of their waste at facilities outside the United States if the PCB concentration is ≥50 ppm because EPA regulations prohibit the export for disposal of such waste (see 40 CFR 761.97). Moreover, it is a violation of the PCB regulations to dilute PCB wastes to lower concentrations to avoid these restrictions on export (40 CFR 761.1(b)(5)). Even if such export were not prohibited, it is not clear that export would be a viable option. Even assuming that foreign countries would be willing to accept PCB waste from the United States, there is some uncertainty about the disposal capacity at foreign disposal sites capable of managing PCBs (Ref. 17). Furthermore, EPA disfavors disposing of PCB wastes generated in the United States in other countries.
The only remaining disposal option for most TSCA-regulated PCB waste in the territories and possessions is disposal in one of the TSCA-approved facilities in the mainland United States. However, EPA has historically interpreted TSCA in a way that made this option unavailable. Since 1979, TSCA section 6(e) has banned the manufacture of PCBs except under an exemption issued by rulemaking. TSCA section 3(7) defines “manufacture” to include “import into the customs territory of the United States (as defined in general note 2 of the Harmonized Tariff Schedule of the United States).” General note 2 defines the “customs territory of the United States” as “any State of the United States, the District of Columbia, and Puerto Rico.” Thus, any movement of PCBs from a location outside the customs territory of the United States to a location inside the customs territory could be considered to be an import of PCBs into the customs territory of the United States. Since most of the territories and possessions, such as Guam and American Samoa, are not included within the definition of “customs territory of the United States” as found in the Harmonized Tariff Schedule, EPA has historically interpreted a movement of PCBs from one of these areas to a mainland State to be an “import” within the meaning of “manufacture” as it is used in TSCA section 6(e)(3). EPA has in the past exercised limited discretion to allow the movement of PCB waste from U.S. territories and possessions to the mainland United States (Ref. 15).
EPA proposes to amend its regulations to allow the movement of PCB waste for disposal among any States of the United States, as defined in TSCA sections 3(13) and 3(14), regardless of whether the waste enters or leaves the customs territory of the United States, provided that the PCBs [or the PCB waste] were present in the United States on January 1, 1979, when the ban on manufacturing took effect, and have remained within the United States since that date. EPA would not consider these movements to be imports subject to the ban on manufacturing under TSCA sections 3(7) and 6(e)(3)
As noted above, the territories and possessions are subject to all of TSCA's requirements. EPA is charged with implementing section 6(e) to protect the health and environment of all United States citizens, including the residents of the territories and possessions. To interpret the statute as prohibiting the movement of PCB waste from the territories and possessions to disposal facilities in the United States mainland puts the residents of the territories and possessions at a serious disadvantage compared to residents of areas that fall within the definition of the customs territory. Because there are no EPA-approved commercial PCB storage or disposal facilities outside the customs territory, and because of the unique environmental conditions in the territories and possessions, the Unites States citizens of these areas are subject to a higher likelihood of exposure to PCBs, and thus a higher risk of injury.
Moreover, EPA is particularly concerned about the risks from improper disposal of PCBs wherever it may occur. PCBs are persistent in the environment and can become dispersed world-wide. Research supporting EPA's report to Congress,
EPA is also concerned that the only options currently available for handling PCBs in the territories and possessions may violate the requirements of TSCA and its implementing regulations. Indefinite storage of PCB waste is not lawful under EPA's regulations at 40 CFR 761.65. Disposal in a facility that is not EPA-approved would also violate the regulations. As noted above, shipment of any wastes containing PCBs ≥50 ppm to a foreign country for disposal would violate the export prohibition. In contrast, residents of areas inside the customs territory that do not have EPA-approved PCB disposal facilities can simply ship their PCB wastes to an approved facility in another State. For example, the residents of Alaska and Hawaii, States in which no TSCA-approved disposal facilities are located, can ship their PCBs to facilities in the mainland United States for disposal (Ref. 13), in spite of the fact that it is impossible to move wastes from those States to the mainland without either entering Canada or crossing international waters (40 CFR 761.99).
EPA has determined that its previous interpretation of the definition of “manufacture” is not mandated by the language of TSCA, results in inequitable treatment among different areas within the United States, does not adequately protect health and the environment throughout the United States, and therefore is not in the public interest. EPA believes that the term “import,” as commonly understood, was not intended to include the movement of PCB waste that has never been outside the United States or outside the regulatory control of TSCA (after enactment) from one area of the United States (the territories and possessions) to another area of the United States (the mainland) for disposal. There is an obvious distinction between that type of movement and the introduction of a chemical into the United States from a foreign country, which is clearly an import. This latter category is much more analogous to the manufacture of a new chemical substance in the United States. Therefore, EPA proposes to interpret the movement of PCB waste from the territories and possessions into the customs territory of the United States for disposal not to be an import, and therefore not within the ban on manufacture under TSCA section 6(e).
This proposed interpretive rule would allow the movement of PCB waste for disposal among any States of the United States, as defined in TSCA sections 3(13) and 3(14), regardless of whether the waste enters or leaves the customs territory of the United States, provided that the PCBs in the waste were present in the United States on January 1, 1979, when the ban on manufacturing took effect, and has remained within the United States since that date. This would allow PCB waste that was present in the territories and possessions at the time TSCA's ban on manufacturing took effect, and that remained within the territories and possessions since that date, to be stored and disposed of in any facility in the United States that meets the requirements of 40 CFR part 761, subpart D. It would also allow PCBs that were present in the territories and possessions at the time TSCA's bans took effect, but were not designated as waste until after that date, to be stored and disposed of in any subpart D facility in the United States, as long as the PCBs and PCB waste had remained in the United States. Finally, it would allow PCBs or PCB wastes that were transferred from an area in the United States that is outside the territories and possessions, but that was moved to a territory or possession after January 1, 1979, and that has never left the United States, to be stored and disposed of in any subpart D facility in the United States. EPA would not consider movement of any of these wastes to the customs territory of the United States to be an import subject to the ban on manufacturing under TSCA section 6(e).
This proposed rule would apply to PCB waste that is present in the territories and possessions as the result of conduct that was legal at the time it occurred (for example, PCB materials that were brought to the territories before TSCA's ban on distribution in commerce became effective), and that has been subject to regulation under TSCA throughout its lifespan; or PCB equipment that was lawfully in use in one of the States, that was transferred to a territory or possession for continued lawful use, and that reached the end of its useful life and became subject to disposal while in the territory or possession.
This proposed amendment would also be consistent with EPA's longstanding policy that it does not interpret movement of PCBs purchased or procured in the United States by the Federal Government, taken overseas for use in United States Government facilities, remained under the control and jurisdiction of the United States Government, and subsequently returned to the United States for disposal in an approved facility as either exports or imports for purposes of TSCA section 6(e) (Refs. 14 and 16). EPA established this policy because the wastes had always been the property of the United States and disposal facilities for these wastes might not be readily available overseas.
This proposed rule would not allow disposal in the United States of PCBs transported to the territories and possessions from foreign countries after the effective date of the ban on manufacture in TSCA section 6(e)(3). The purpose of this proposal is to ensure that all United States PCB waste can be disposed of in compliance with the requirements of TSCA section 6(e) and its implementing regulations. This proposal is not intended to allow the territories and possessions to become a conduit to the United States for PCB waste generated in other countries.
Finally, EPA has not made a formal finding of “no unreasonable risk” for this proposed regulation. This regulation is not being proposed under TSCA section 6(e), but rather as an exercise of EPA's inherent authority to interpret the statutes it administers.
As indicated in Unit I.B.2., the official record for this rulemaking has been established under docket control number OPPTS-66020, the public version of which is available for inspection as specified in Unit I.B.2. The following is a listing of the documents that have already been placed in the official record for this rulemaking:
1. U.S. Environmental Protection Agency (USEPA). 44 FR 31514, May 31, 1979, “Polychlorinated Biphenyls (PCBs); Manufacturing, Processing, Distribution in Commerce, and Use Prohibitions: Final Rule.”
2. USEPA. 45 FR 29115, May 1, 1980, “Polychlorinated Biphenyls (PCBs); Expiration of the Open Border Policy for PCB Disposal: Notice.” OPTS 62008.
3. USEPA. 59 FR 62788, December 6, 1994, “Disposal of Polychorinated Biphenyls: Proposed Rule.” OPPTS-66009A.
4. USEPA. 61 FR 11096, March 18, 1996, “Disposal of Polychlorinated Biphenyls; Import for Disposal: Final Rule.” OPPTS-66009B.
5. USEPA. 63 FR 35384, June 29, 1998, “Disposal of Polychlorinated Biphenyls (PCBs): Final Rule.” OPPTS-66009C.
1. USEPA, Office of Research and Development (ORD). PCBs Cancer Dose-Response Assessment and Application to Environmental Mixtures. EPA600P-96001F (September 1996): 75pp. OPPTS-66009C.
2. USEPA, Office of Air Quality Planning and Standards (OAQPS). Deposition of Air Pollutants to the Great Waters, First Report to Congress. EPA-453R-93-055 (May 1994): 136pp. OPPTS-66009B.
3. USEPA, OAQPS. Identification of Sources Contributing to the Contamination of the Great Waters by Toxic Compounds. EPA-453R-94-087 (March 17, 1993): 145pp. OPPTS-66009B.
4. USEPA, OAQPS. Relative Atmospheric Loadings of Toxic Contaminants and Nitrogen to the Great Waters. EPA-453R-94-086 (March 15, 1993): 142pp. OPPTS-66009B.
5. USEPA. Chapter 2.2, Exposure and Effects of Airborne Contamination for the Great Waters Program Report. EPA-453R-94-085 (December 22, 1992): 201pp. OPPTS-66009B.
6. USEPA, Office of Prevention, Pesticides, and Toxic Substances (OPPTS). Commercially Permitted PCB Disposal Companies (April 2000): 3pp.
7. USEPA, Office of Pollution Prevention and Toxics (OPPT). Excerpt from the PCB Waste Handler Database; Facility Information for U.S. Territories and Possessions (September 27, 2000): 12pp.
8. USEPA, Region IX. Memo from Lily Lee, Guam Program Manager, to Enrique Manzanilla, Director, Cross Media Division, Re: Summary of PCB Waste Quantities and Concentrations in the US Territories (July 19, 2000): 5pp.
9. Unitek Environmental-Guam. Letter from LeRoy Moore, President, to John Malone [sic], Director, National Program Chemicals Division, Re: PCB Shipments from Guam and Possessions of the United States for Disposal in the Mainland United States (May 11, 2000): 2pp.
10. USEPA, OPPT. Note from Peter Gimlin to the File, Re: Unitek Environmental-Guam (UEG) Meeting (September 27, 2000): 1p.
11. U.S. Congress. Letter from Robert A. Underwood, House of Representatives, to Carol M. Browner, Administrator, EPA, Re: Disposal of Polychlorinated Biphenyls (PCBs) from Guam and the Other U.S. Territories (April 12, 2000): 2pp.
12. USEPA, Region IX. Letter from Felicia Marcus, Regional Administrator, to Robert A. Underwood, U.S. House of Representatives, Re: Disposal of Polychlorinated Biphenyl Waste (February 4, 2000): 2pp.
13. USEPA, OPPT. Memo from John W. Melone, Director, Chemical Management Division, to George Abel, Chief, Pesticides and Toxic Substances Branch, USEPA Region X, Re: Transit of PCB Waste Generated in the United States Through a Foreign Country (January 19, 1995): 2pp.
14. USEPA, OPPT. Letter from John W. Melone, Director, Chemical Management Division, to Arthur J. Brown, National Science Foundation, Re: Request to Return PCBs in Antarctica to the United States for Disposal (March 11, 1994): 3pp.
15. USEPA, OCM and OE. Letter from Michael F. Wood, Director, Compliance Division, and Michael J. Walker, Enforcement Counsel for the Toxics Litigation Division, to Marion P. Herrington, General Electric Company, Re: Transfer of PCB Waste Generated in A U.S. Territory to An Approved Disposal Facility in the Continental United States (August 14, 1992): 2pp.
16. USEPA, Office of Toxic Substances (OTS). Letter from Don R. Clay, Director to Colonel Joseph T. Cuccaro, Defense Logistics Agency, Re: USEPA Position on DOD Owned PCB Fluid Located Abroad and Returned to the U.S. for Disposal (February 7, 1984): 3pp.
17. United Nations Environment Programme (UNEP). Inventory of World-wide PCB Destruction Capacity, First Issue (December 1998): 85pp.
18. U.S. Congress. Congressional Record from the House of Representatives, H8598, Guam's Environmental Problems (October 2, 2000): 1p.
19. U.S. Congress. Letter from Robert A. Underwood, House of Representatives, to Carol Browner, Administrator, EPA, Re: Inability of Guam to Import PCBs into the U.S. Mainland for Proper Disposal (December 10, 1999): 2 pp.
20. USEPA, OPPTS. Letter from Susan H. Wayland, Acting Assistant Administrator, to Robert A. Underwood, U.S. House of Representatives, Re: Disposal of PCB Waste in Guam (June 14, 2000): 2 pp.
21. USEPA, OPPTS. Letter from Susan H. Wayland, Acting Assistant Administrator, to Robert A. Underwood, U.S. House of Representatives, Re: Meeting on PCB Waste in Guam (September 29, 2000): 2 pp.
Under Executive Order 12866, entitled
Pursuant to section 605(b) of the Regulatory Flexibility Act (RFA), as amended by the Small Business Regulatory Enforcement Fairness Act of 1996, 5 U.S.C. 601 et seq., the Agency hereby certifies that this final rule will not have a significant economic impact on a substantial number of small entities. The factual basis for this determination is that this action is not expected to result in any direct adverse impact for small entities. This rule interprets the prohibition on the “manufacture of PCBs” in a manner which affords U.S. citizens (including small entities) residing in U.S. territories and possessions located outside the “customs territory of the United States” an opportunity to dispose of PCB waste when facilities that require EPA approval to manage PCB waste are not readily available. This rule is being promulgated in the public interest to ensure equitable treatment among different areas within the United States and adequate protection of health and the environment throughout the United States. This rule provides a mechanism for the disposal of PCB waste resulting from natural disasters (e.g., tropical storms, cyclones, typhoons and hurricanes), former use of U.S. territories and possessions for defense purposes, spills of PCBs and when PCB equipment has reached the end of its natural life span.
This regulatory action does not contain any information collection requirements that require approval by the Office of Management and Budget (OMB) under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq.
Pursuant to Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104-4, EPA has determined that this action does not contain a Federal mandate that may result in expenditures of $100 million or more for State, local or tribal governments, in the aggregate, or on the private sector in any one year. The UMRA requirements in sections 202, 204, and 205 do not apply to this rule, because this action does not contain any “Federal mandates” or impose any “enforceable duty” as defined by UMRA on StateTribal, or local governments or on the private sector. The requirements in section 203 do not apply because this rule does not contain any regulatory requirements that might significantly or uniquely affect small governments.
Executive Order 13132, entitled
This proposed rule does not have federalism implications, because it will not have substantial direct effects 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, as specified in Executive Order 13132. This action interprets the TSCA prohibition on the manufacture of PCBs in a manner which allows PCB waste in U.S. territories and possessions located outside of the customs territory of the U.S. to be disposed of in EPA-approved facilities on the mainland of the United States. Thus, the requirements of section 6 of the Executive Order do not apply to this rule.
Under Executive Order 13084, entitled
If EPA complies by consulting, Executive Order 13084 requires EPA to provide to the Office of Management and Budget, in a separately identified section of the preamble to the rule, a description of the extent of EPA's prior consultation with representatives of affected tribal governments, a summary of the nature of their concerns, and a statement supporting the need to issue the regulation. In addition, Executive Order 13084 requires EPA to develop an effective process permitting elected officials and other representatives of Indian tribal governments “to provide meaningful and timely input in the development of regulatory policies on matters that significantly or uniquely affect their communities.”
This rule does not significantly or uniquely affect the communities of Indian tribal governments, nor does it impose substantial direct compliance costs on such communities. It interprets the TSCA prohibition on the manufacture of PCBs in a manner which allows PCB waste in U.S. territories and possessions located outside of the customs territory of the U.S. to be disposed of in EPA-approved facilities on the mainland of the United States. Accordingly, the requirements of section 3(b) of Executive Order 13084 do not apply to this rule.
Pursuant to Executive Order 12898, entitled
Executive Order 13045, entitled
This regulatory action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA), Public Law 104-113, section 12(d) (15 U.S.C. 272 note).
EPA has complied with Executive Order 12630, entitled
In issuing this rule, EPA has taken the necessary steps to eliminate drafting errors and ambiguity, minimize potential litigation, and provide a clear legal standard for affected conduct, as required by section 3 of Executive Order 12988, entitled
Environmental protection, Hazardous substances, Labeling, Polychlorinated Biphenyls (PCBs), Recordkeeping and reporting requirements.
15 U.S.C. 2605, 2607, 2611, 2614, and 2616.
(c) PCB waste transported from any State to any other State for disposal, regardless of whether the waste enters or leaves the customs territory of the United States, provided that the PCB waste or the PCBs from which the waste was derived were present in the United States on January 1, 1979, and have remained within the United States since that date.
Office of Postsecondary Education, Department of Education.
Final regulations.
The Secretary amends the Institutional Eligibility, the Student Assistance General Provisions, the Federal Work-Study (FWS) Programs, and the Federal Pell Grant Program regulations. These final regulations implement changes negotiated under the negotiated rulemaking process mandated by Congress under section 492 of the Higher Education Act of 1965, as amended, (HEA). These changes streamline the application, reapplication, and certification processes for institutions that wish to participate in the title IV, HEA programs and provide simplification and flexibility in other provisions of the regulations that apply to the title IV HEA programs.
Mark Washington, U.S. Department of Education, 400 Maryland Avenue, SW., Room 3045, ROB-3, Washington, DC 20202-5447. Telephone: (202) 260-9321.
If you use a telecommunications device for the deaf (TDD), you may call the Federal Information Relay Service (FIRS) at 1-800-877-8339.
Individuals with disabilities may obtain this document in an alternative format (
On August 10, 2000 the Secretary published a notice of proposed rulemaking (NPRM) for Institutional Eligibility, Student Assistance General Provisions, Federal Work-Study Programs (FWS), Federal Family Education Loan (FFEL) Program, William D. Ford Direct Loan (Direct Loan) Program; and the Federal Pell Grant Program, in the
In the preamble to the NPRM, the Secretary discussed on pages 49135 through 49147 the major changes proposed in that document. These included the following:
• Revising §§ 600.20 and 600.21, amending §§ 600.10 and 600.31, and removing §§ 600.9 and 600.30 to streamline the application, reapplication and certification processes for institutions that wish to participate in the title IV, HEA programs (pages 49149-49152).
• Revising § 600.31 to clarify the reporting responsibilities for institutions that undergo a change of ownership that results in change of control (pages 49151-49152).
• Revising § 668.5 to expand the possibilities for institutions to create written agreements with certain other entities to have part or all of their eligible programs provided by those entities (pages 49152-49153).
• Adding flexibility in § 668.13 to the training requirements for institutional certification (page 49153).
• Revising in § 668.19 the process for obtaining a transfer student's financial aid history (page 49153).
• Revising § 675.19 to permit additional certification and record retention options for FWS program administration (pages 49153-49154).
• Providing in §§ 682.604 and 685.301 additional flexibility in the loan disbursement rules for students enrolled in non-traditional programs (page 49154).
• Clarifying in § 668.165 the notification requirements when title IV loan proceeds are credited to a student's institutional account (page 49154).
• Adding flexibility in § 682.207 to lender disbursement requirements and eligibility determinations for students receiving loan proceeds under the FFEL Program (page 49154).
In these final regulations, we make two significant changes from the regulations that we proposed in the NPRM published on August 10, 2000. First, we will require all institutions to report to us of their intent to add a location offering 50 percent or more of an eligible program, regardless of the type of institution. A small number of institutions—those that meet one or more of the specified conditions discussed later in the analysis of comments—will have to await our approval of the new location before disbursing title IV, HEA program funds to students at that location. Other institutions must report to us their intent to add additional locations, but are not required to wait for our approval of those locations.
Second, public institutions must report changes in governance to us within 10 days of their occurrence.
The Secretary published an NPRM on July 27, 2000, for parts 682 and 685 in the
Section 482(c) of the HEA requires that regulations affecting programs under title IV of the HEA be published in final form by November 1 prior to the start of the award year (which begins July 1) to which they apply. However, that section of the HEA also permits the Secretary to designate any regulation as one that an entity subject to the regulation may choose to implement earlier. If the Secretary designates a regulation for early implementation, he may specify when and under what conditions the entity may implement it. Under this authority, the Secretary has designated the following regulations for early implementation:
These regulations may be implemented upon publication of this final rule. This means that if an institution is subject to loss of eligibility due to a change in ownership that results in a change of control, it may ask the Secretary to permit it to continue to participate in the title IV, HEA programs on a provisional basis, provided that the institution submits a materially complete application.
This early implementation also changes the definition of “ownership interests” to exclude certain institutional investors, and clarifies when a shareholder would be deemed a
Early implementation means that public institutions that experience a change in governance will not be considered to have undergone a change in ownership resulting in a change of control, but these institutions must report such changes within ten days of the occurrence.
Finally, early implementation means that the provisions that define more clearly ownership in a publicly-traded institution will be in effect.
These regulations may be implemented by institutions upon publication of this final rule. This means that a school may use a single written arrangement with a study-abroad organization to represent agreements between the school and one or more foreign schools. Also, any of the eligible institutions that are parties to a written arrangement may make title IV calculations and disbursements and will not be considered third-party servicers.
These regulations may be implemented upon publication of this final rule. Institutions that administer the Federal Work-Study (FWS) Programs will now have the option to certify FWS timesheets in writing or electronically. If an institution elects to use an electronic certification option, it should be certain to use the appropriate safeguards, as outlined in the NPRM at page 49145.
The regulations in this document were developed through the use of negotiated rulemaking. Section 492 of the HEA requires that, before publishing any proposed regulations to implement programs under title IV of the HEA, the Secretary obtain public involvement in the development of the proposed regulations. After obtaining advice and recommendations, the Secretary must conduct a negotiated rulemaking process to develop the proposed regulations.
These regulations were published in proposed form on August 10, 2000, following the completion of the negotiated rulemaking process. The Secretary invited comments on the proposed regulations that were due by September 25, 2000, and we received thirty-three comments.
An analysis of the comments we received and of the changes we made in the regulations since publication of the NPRM follows.
We group major issues according to subject. We discuss other substantive issues under the sections of the regulations to which they pertain. Generally, we do not address technical and other minor changes—and suggested changes the law does not authorize the Secretary to make.
One commenter believed the exemption is appropriate because public institutions that have added locations in the past have not placed Federal funds at risk.
Another commenter generally supported the proposed exemption, but believed that the exemption should apply to an additional location even if the location is not in the same state as the main campus. That commenter believed that the reasons given by the Department for the proposed exemption for public institutions (sufficient oversight and financial backing by a public entity) are valid, regardless of whether the additional location is located in the same state as the main campus.
Six commenters did not support requiring public institutions to report a new location. The commenters contended that, because we have virtually always approved additional locations for public institutions, required reporting would create unnecessary paperwork and a potential for delay. Some of the commenters also believed that the minimal risk represented by public institutions delivering title IV, HEA assistance made reporting unnecessary.
Another commenter supported requiring public institutions to inform us of a new location. That commenter felt that six years between recertification cycles for participation in the student aid programs is too long for locations to go unreported. The commenter believed that those entities charged with oversight will improve the quality of such oversight, by having an awareness of such locations. The commenter noted that these benefits appear to outweigh the minimal burden of reporting the locations.
Several commenters opposed our proposal exempting public institutions from applying for approval of an additional location. These commenters felt that treating public institutions differently from other institutions is unwarranted, and would give an unfair advantage to public institutions by eliminating potential delays. The commenters believed that one set of criteria should be developed for all institutions.
Two commenters felt that the unfair competitive advantage referred to above would not serve the needs of students nor the public interest, because it would not produce the best range of educational offerings or encourage the most efficient use of resources. Another commenter noted that in some highly competitive disciplines, such as computer science, information technology, and business administration or executive management, even a 35 day head start (our stated goal for the length of time within which we will process applications for approval) constitutes a significant advantage in terms of public relations and market share.
Three commenters believed that there are many poorly performing public institutions and that such an exemption would unnecessarily put taxpayer funds at risk. One of these commenters was specifically concerned that the proposed exemption for public institutions would permit higher-risk public institutions, such as those on provisional certification or the reimbursement payment method, to open new locations and disburse title IV aid without our approval. The commenter felt that this scenario would contradict the purpose of provisional certification and reimbursement, which is to permit us to more closely monitor higher-risk institutions. The commenter felt that it was arbitrary and capricious to allow such high-risk public institutions to open additional locations without our approval, while denying this benefit to non-public institutions with strong
Another commenter stated that there was no publicly available evidence to support the contention that all public institutions provide better oversight and control, plan better, and have more fiscal resources than institutions in other sectors. The commenter was convinced that there is evidence to the contrary, such as the placement of public institutions on provisional certification, the failure of public institutions to meet their unique financial responsibility standards, and those public institutions with high student loan default rates.
Some commenters that did not support the exemption for public institutions suggested a number of general criteria that should be used in determining whether any institution qualifies for an exemption. One commenter suggested that the criteria should reward those institutions that have demonstrated appropriate administrative capability. Another commenter felt that the Federal interest in additional locations should focus on an institution's maintenance of quality in their educational programs. The commenter stated that we seemed to acknowledge that the quality of programs is the issue by our statement in the preamble to the NPRM that, “some non-public institutions grew so rapidly that the integrity of their educational and student aid programs was compromised”.
Other commenters offered specific ideas about criteria that should be used to determine if any institution should be granted an exemption from reporting additional locations. One commenter suggested that an exemption should be given to an institution that: satisfies the criteria we proposed in § 600.20(d)(2) for temporary locations, is fully certified, meets the general standards of financial responsibility, has no late audits or significant audit findings in the last two years, has no significant program review liabilities, and was not subject to a limitation, suspension, or termination action within the last three years. Another commenter generally agreed with the suggested criteria but instead of supporting the proposed criteria in § 600.20(d)(2), suggested the following criteria: the institution has full regional or national accreditation, would not be subject to a loss of eligibility under § 668.188 if it adds a new location, and has not added more than 10 locations at which it offered 50 percent or more of an educational program since it was last certified to participate in the title IV programs. The commenter also believed that to qualify for an exemption, an institution should have no late audits or significant audit findings in the last five years and never have been subject to a program review liability.
Another commenter believed that it is appropriate for us to learn about temporary locations that have been opened through annual compliance audits. The commenter did not feel that a separate notification would be needed.
However, another commenter representing the largest professional association of certified public accountants disagreed. In particular, the commenter stated that we should require institutions to submit information on temporary locations directly to us. The commenter noted that if we want independent third-party assurances on an institution's management's assertions regarding the institution's compliance with such a requirement, compliance objectives and associated auditor reporting could be developed as part of the annual compliance audit.
One commenter supported the provision that would exempt a non-public institution from applying for approval of licensed and accredited temporary locations if it met the proposed criteria, including the limitation on adding no more than six locations offering 50 percent or more of a program since it was last certified. Another commenter felt that it is more appropriate to focus on the number of such locations established in a short period of time rather than over the entire certification period. The commenter recommended that no more than two such locations should be added during any 12-month period, and that for any more locations an institution should be required to obtain our approval prior to disbursing any title IV funds to students attending those locations.
Another commenter suggested that the criteria for exemption of temporary locations should include a certification from the institution's Chief Executive Officer that the institution currently meets all applicable federal requirements regarding financial and administrative capability (based on the institution's most recent audited financial statement and compliance audit, recent regulatory reviews, and program participation agreement). The commenter believed that no more title IV funds should be disbursed to students at a temporary location after the end of the first year, until we have approved the location, unless the institution submitted a materially complete application for our approval at least 35 days before the end of the period.
The commenter also felt that the proposed requirement that the institution must not have acquired the assets of another institution that formerly provided programs at that site was stated in an overly broad manner. Instead, the commenter recommended that the institution must not have acquired a substantial amount of the assets of another institution that formerly provided programs at that site within the past 12 months. The commenter believed that this would address significant, recent acquisitions or transfers of assets that we need to be aware of without providing for unnecessary scrutiny of insignificant transactions that do not pose concern.
Finally, one commenter noted inconsistencies between the proposed regulatory language for § 600.20(d)(2)(ii) (which refers to locations at which more than 50 percent of a program is added) and the description of the proposed provision (which refers to locations as “offering at least 50 percent of an educational program” in one place and “offered more than 50 percent of an educational program” in another). The commenter believed that the correct wording is “at least 50 percent”.
We carefully considered the comments received on both the proposal to exempt public institutions from applying for approval of an additional location where the institution will offer 50 percent or more of an eligible program, and the proposal to exempt all institutions from the requirement to apply for approval of an additional location if it will be in operation for less than 12 months.
We agree that the approach to additional locations in the NPRM had the potential to bar some high performing, non-public institutions from the benefits and incentives we desire to make available to those who administer our programs properly.
We stated in the NPRM our belief that the proposed regulations would enhance efficiency and provide administrative relief for a sizable segment of the population of eligible institutions, by not requiring them to report locations they add until the next scheduled recertification. Upon
Based upon the comments received on these issues and our plans to improve the efficiency of the reporting process, we are persuaded that it is prudent and not particularly burdensome, to require all institutions report to us if they wish to disburse title IV, HEA program funds to students enrolled at a new additional location, at which 50 percent or more of an eligible program will be offered.
For the purposes of these regulations, reporting consists of submitting an electronic application which provides specific information and required supporting documentation regarding the new location.
While all institutions must report their new locations, only those that meet certain criteria are required to wait for our approval before disbursing title IV, HEA program funds to eligible students at those locations. A full explanation of those criteria follows later in this discussion. For the purposes of these regulations, approval consists of the Secretary's written response to an application, granting specific permission to an institution to disburse funds to students enrolled at the specified location. If an institution is not required to wait for our approval, it must simply report to us through the electronic application process prior to disbursing title IV, HEA program funds.
These provisions replace the proposed across-the-board exemption from reporting or approval for public institutions and the exemption for temporary locations included in the NPRM.
Under these new provisions, no distinction is made between temporary and permanent locations. All institutions are required to report to us any new location where 50 percent or more of an eligible program is offered. The report must include supporting documentation and be provided before the institution disburses title IV, HEA funds to students at that location. Those institutions that are only required to report to us before they disburse federal student aid need not wait for our approval. However, those institutions that meet any of the criteria discussed below must report to us and then wait for our approval before they can disburse title IV, HEA program funds to eligible students at the new location.
We will only require an institution to apply and wait for our approval to disburse title IV, HEA program funds at locations where they offer 50 percent or more of an eligible location if the institution: (1) Is provisionally certified, (2) is on the reimbursement or cash monitoring system of payment, (3) has acquired the assets of another institution that provided educational programs at that location during the preceding year, and the other institution participated in the title IV, HEA programs during that year, (4) would be subject to a loss of eligibility under the cohort default rate regulations at § 688.188 if it adds that location, or if (5) the Secretary previously prohibited it from disbursing title IV, HEA program funds to students enrolled at an additional location before the Secretary notifies it that the location is eligible to participate in the title IV, HEA programs.
Under the last criteria we may preclude an institution from adding locations due to financial, administrative, compliance or other concerns about an institution. In this case, the institution will receive a written notice that sets out the reason it will be required to apply for approval for additional locations. The institution may request reconsideration of that decision if it shows there are material errors in the facts we considered in making our determination.
With regard to the criteria related to provisional certification, the Secretary plans to publish a change to the provision in 34 CFR 668.16(m) that relates to placing an institution on provisional certification if it has a cohort default rate in the FFEL and/or Direct Loan programs of 25 percent or greater. That change will provide more flexibility to the Secretary in choosing whether or not to place such an institution on provisional certification.
We believe that many more institutions will benefit from the provision that they must only report to us and not await our approval, since it allows them to begin disbursing aid at these new locations immediately upon their reporting to us. We anticipate the number of institutions that qualify for this flexibility will be much greater than the number of institutions that will be required to await our approval before disbursing title IV, HEA program funds to eligible students at those locations. Also, the minimal reporting burden required of an institution enables us to maintain accurate and updated records of all locations where students who are receiving title IV, HEA funds are enrolled.
Institutions are responsible for knowing whether they need to obtain our approval to disburse title IV, HEA program funds to eligible students at the new location. If an institution is unsure whether it meets the criteria requiring it to wait for our approval, it may contact us for specific guidance. Institutions that add locations without obtaining our approval when they knew, or should have known, that they were required to wait may be subject to administrative repayments and other sanctions.
Notices sent according to § 600.20(e)(2)(iv) and 600.20(e)(2)(v) will indicate the effective dates of eligibility, and any conditions, related to that eligibility respectively.
We agree with the commenter that § 600.20(f)(4) in the NPRM does not provide a reference to § 600.20(c)(4) and (5). We will make the necessary corrections.
Another commenter suggested clarifying in proposed § 600.31(c)(2)(ii)(A) that the controlling shareholder be determined through measuring only the voting stock, by adding the phrase “of the voting stock” after the word “shares” to read: “A controlling shareholder is a shareholder who holds or controls through agreement both 25 percent or more of the total outstanding voting stock of the corporation and more shares of the voting stock than any other shareholder.”
Therefore, a person who controls 25 percent or more of the outstanding voting stock of a company and more stock than any other person by a combination of personal investment ownership and representation of institutional investors uniquely classifies one as a controlling shareholder, who can reasonably be expected to exercise real influence over management and its policies. The effect of this kind of shareholder's control on the corporation deserves the same scrutiny as that of any other shareholder who can control corporate policies.
Thus, to determine whether a shareholder is a controlling shareholder under the bright-line test, the rule counts all voting stock held or controlled by a shareholder, unless all stock held by that shareholder is held as an institutional investor.
Since most financial transactions are accounted for in accordance with the established system of accounting principles, we patterned our “bright line” threshold directly after Accounting Principles Board Opinion No. 18, which defines for GAAP purposes the percentage of ownership that can reasonably be presumed to give an investor the ability to exercise significant influence over an investee.
GAAP provides that control of 20 percent of the voting stock of a corporation raises a rebuttable presumption of control of the corporation and conversely, that control of a smaller percentage of a corporation's stock raises a rebuttable presumption that the holder lacks control. We chose that adoption of an irrebutable “bright line” test was desirable both to allow institutions to plan their financial affairs with greater predictability, and to eliminate the burden of our examining the circumstances surrounding each significant diminution in ownership interest of an institution owned by a publicly-traded corporation. We believe that a higher threshold than 20 percent should be used in return for adoption of a “bright line” standard. The choice of 25 percent as the threshold is not compelled by statute or regulation, but is a reasonable choice. We therefore choose to retain 25 percent as the “bright line” measure of control.
We also disagree that while 25 percent ownership of stock may be influential, 50 percent is required to control an entity. For publicly-traded corporations, the opposite inference is compelling: The more widely held the stock of a corporation, the smaller the percentage of its stock that need be controlled by a person in order to allow that person to “direct or cause the direction of the management and policies” of the corporation (see, § 600.31(b) definition of “control”). The investing public and the accounting profession recognize that a shareholder can control a corporation while owning or controlling far less than 50 percent of its stock. There is no reason that we should ignore that same conclusion.
Finally, the position that eligibility and certification lapse upon a change in ownership that results in a change in control is not a position that we arbitrarily adopted, but is required by the HEA. Section 498(i) mandates that eligibility must be reestablished after a change in ownership resulting in a change in control, and that the transfer of the controlling interest of stock of the institution is an action that results in such a change in control.
One commenter supported the provision that would provide that a change in governance at a public institution is not a change in ownership. Additionally, the commenter did not believe that it was necessary to limit this to changes in governance in the same state included in the program participation agreement. The commenter felt that the same assurances associated with the fact that public oversight of the institution exists would also apply in the rare instance that the governance of a public institution switched from one state to another. The commenter also did not believe that it would be necessary to require the new governing authority to acknowledge the institution's responsibilities under its program participation agreement. The commenter noted that the institution remains the same institution and, therefore, retains the responsibilities it acquired by signing its program participation agreement.
Five commenters did not believe that a particular form of acknowledgement should be required for institutions that must acknowledge their continuing responsibilities under the program participation agreement because the formal transfer of governing authority might not include such an acknowledgement. These commenters felt it would be more useful for
Three commenters did not support the proposed provision allowing a change in governance at a public institution to not be considered a change in ownership if the institution's new governing body is in the same State. The commenters contended that there are several circumstances where a public institution should be considered to have had a change in ownership.
The commenters also believed that a change in ownership has occurred when a public institution is transferred from control from a higher level of governmental authority (such as a State) to a lower one (such as a county) which may not have the same level of resources to commit to the institution. One commenter believed that in such a case there was no guarantee of continuing operational effectiveness. The commenter felt that such an exemption for all public schools would put taxpayers' funds at risk. Two of the commenters believed that, at the very least, the institution should be required to inform us of the change so that we can determine whether it meets the requirements for the exemption.
One commenter felt that new types of “quasi public” institutions, such as charter colleges are not likely to have the same level of oversight and financial stability as a traditional public institution, and should not be given broad regulatory exemptions. The commenter also felt that we should retain an interest in approving a change in which an institution, for the first time, will be administering the Federal financial aid programs. The commenter gave an example of several two-year colleges in a state that have been managed by four-year institutions, but may be given autonomy to operate (and presumably, participate in the title IV, HEA programs) on their own. The commenter concluded by noting that all of the public institutions in that state may have their state funding tied to meeting specific performance goals.
We are not persuaded to extend the scope of the proposal to permit a public institution in one State to acquire a public institution in another State without having that change considered a change of ownership resulting in a change in control, and thus requiring the institution to apply for approval of a change of ownership. In such an instance, the ownership and control of the institution would be changing from one State to another, so that an entirely different public constituency would be assuming responsibility for the institution. This type of structure would also raise questions about State licensing, since the public institution owned by one State would be operating under the State licensing requirements of a different State. We have considered the suggestions from commenters that public institutions should be required to report to us when a change of governance takes place even if that change is not considered a change in ownership resulting in a change in control, and we agree. Such information will permit us to examine the transaction to ensure that it meets the definitional requirements and to determine if there are any other issues involving the institution warranting further action.
We agree with the comments that cautioned against exempting changes of governance at a public institution that is transferred to a “quasi public” entity such as a charter college or other hybrid entity. As we stated in the NPRM, the provision does not apply if a change in governance involves a hybrid entity, such as a corporation with limited liability, public-private partnerships, or joint ownership with out-of-State entities.
Another commenter representing a large, private university supported the proposed revisions, and expected a significant reduction in the administrative burden experienced, as schools currently must obtain and maintain separate agreements with each
We regularly review the training requirements to ensure that relevance, accuracy, and practicality are reflected in the subject matter. We also seek to continually simplify the training requirements without diluting the core content, to encourage institutions to make use of these resources when assessing and maintaining the technical readiness of their staffs.
However, a student may be liable for any overpayment that is the result of information the school receives after it follows the procedures in these rules. This concept is explained more fully in Dear Colleague Letter GEN-96-13.
On the other hand, we agree with the commenter's general view that there should be a single process under which a school receives updated financial aid history information for all transfer students. However, in many cases (particularly for prior-year transfer students) the updated information will not affect those students' current year eligibility or award amounts. Moreover, currently we have no way of determining which school a transfer student is attending until after NSLDS receives disbursement information identifying that school.
For these reasons, we proposed a targeted approach under which a school would inform NSLDS of the transfer students that are attending (or planning to attend) their school and NSLDS would provide, directly to that school, updated information about those students. Although these rules apply only to current-year transfer students, a school may use the new NSLDS process to receive updated information for any transfer student.
We noted in the NPRM that we support the presumption recognized in the law that mail deposited with the USPS is delivered. Certainly, there are documented cases where this presumption fails because of the potential for error that accompanies any system dependent upon human interaction. However, we see the differences between an established, federally supported, national delivery system and an electronic delivery method that operates independently and through many different private software providers without a uniform standard, as very significant.
The USPS has several proven methods and systems that it may use to track mail deposited in its system. It also utilizes uniform automated systems that process mail throughout the nation. The USPS also sets coherent operating standards and employs a system of quality assurance to monitor the application and effectiveness of those standards.
On the contrary, both the software applications and the hardware upon which they operate generally limit e-mail capabilities. There are no observed standards or mandated features inherent in all e-mail software applications that provide the quality assurance or maintain a similar level of consistency that parallels that of the USPS.
Another commenter was also supportive of our proposal to allow electronic certification by a supervisor to approve FWS hours recorded on a student's time record. The commenter noted that many of the departments at her school have several hundred employees each. Accordingly, the commenter was aware that several of these departments have implemented electronic timekeeping systems, which have vastly improved the accuracy of the timekeeping function for such a large number of employees. The commenter also felt that being able to move the FWS payroll employees to a more technologically advanced system would be less burdensome, and would avoid having to keep a separate time system for FWS students. The commenter believed that these regulations would improve the utilization of FWS in both on-campus jobs and increasingly, in off-campus employment.
We refer those who administer the FWS Program to page 49145 of the August 10, 2000 NPRM for a full discussion of the safeguards we expect schools to include in any electronic certification process they implement.
We have reviewed these final regulations in accordance with Executive Order 12866. Under the terms of the order we have assessed the potential costs and benefits of this regulatory action.
The potential costs associated with the final regulations are those resulting from statutory requirements and those we have determined to be necessary for administering these programs effectively and efficiently.
In assessing the potential costs and benefits—both quantitative and qualitative—of these final regulations, we have determined that the benefits of the regulations justify the costs.
We have also determined that this regulatory action does not unduly interfere with state, local, and tribal governments in the exercise of their governmental functions.
We discussed the potential costs and benefits of these final regulations in the preamble to the NPRM under Executive Order 12866 (see page 49147 of the NPRM) Potential Costs and Benefits.
The Paperwork Reduction Act of 1995 does not require you to respond to a collection of information unless it displays a valid Office of Management and Budget (OMB) control number. We display the valid OMB control numbers assigned to the collections of information in these final regulations at the end of the affected sections of the regulations.
In the NPRM we requested comments on whether the proposed regulations would require transmission of information that any other agency or authority of the United States gathers or makes available.
Based on the response to the NPRM and on our review, we have determined that these final regulations do not require transmission of information that any other agency or authority of the United States gathers or makes available.
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Administrative practice and procedure, Colleges and universities, Consumer protection, Grant programs-education, Reporting and recordkeeping requirements, Student aid.
Administrative practice and procedure, Colleges and universities, Consumer protection, Grant programs—education, Loan programs—education, Reporting and recordkeeping requirements, Student aid.
Colleges and universities, Employment, Grant programs—education, Reporting and recordkeeping requirements, Student aid.
Grant programs—education, Reporting and recordkeeping requirements, Student aid.
20 U.S.C. 1001, 1002, 1003, 1088, 1091, 1094, 1099b, and 1099c, unless otherwise noted.
(b) * * *
(3) * * *
(i) The Secretary approves that location under § 600.20(e)(4); or
(ii) The location is licensed and accredited, the institution does not have to apply to the Secretary for approval of that location under § 600.20(c), and the institution has reported to the Secretary that location under § 600.21.
(a)
(b)
(2) A currently designated eligible institution that participates in the title IV, HEA programs must apply to the Secretary for a determination that the institution continues to meet the requirements in this part and in 34 CFR part 668 if the institution wishes to—
(i) Continue to participate in the title IV, HEA programs beyond the scheduled expiration of the institution's current eligibility and certification designation;
(ii) Reestablish eligibility and certification as a private nonprofit, private for-profit, or public institution following a change in ownership that results in a change in control as described in § 600.31; or
(iii) Reestablish eligibility and certification after the institution changes its status as a proprietary, nonprofit, or public institution.
(c)
(1) Add a location at which the institution offers or will offer 50 percent or more of an educational program if one of the following conditions applies, otherwise it must report to the Secretary under § 600.21:
(i) The institution participates in the title IV, HEA programs under a provisional certification, as provided in 34 CFR 668.13.
(ii) The institution receives title IV, HEA program funds under the reimbursement or cash monitoring payment method, as provided in 34 CFR part 668, subpart K.
(iii) The institution acquires the assets of another institution that provided educational programs at that location during the preceding year and participated in the title IV, HEA programs during that year.
(iv) The institution would be subject to a loss of eligibility under 34 CFR 668.188 if it adds that location.
(v) The Secretary previously notified the institution that it must apply for approval of an additional location.
(2) Increase its level of program offering (
(3) Add an educational program if the institution is required to apply to the Secretary for approval under § 600.10(c);
(4) Add a branch campus at a location that is not currently included in the institution's eligibility and certification designation; or
(5) Convert an eligible location to a branch campus.
(d)
(e)
(i) Whether the applicant institution qualifies in whole or in part as an eligible institution under the appropriate provisions in §§ 600.4 through 600.7; and
(ii) Of the locations and educational programs that qualify as the eligible institution if only a portion of the applicant qualifies as an eligible institution;
(2) If the Secretary receives an application under paragraphs (a) or (b) of this section and that institution applies to participate in the title IV, HEA programs, the Secretary notifies the institution—
(i) Whether the institution is certified to participate in those programs;
(ii) Of the title IV, HEA programs in which it is eligible to participate;
(iii) Of the title IV, HEA programs in which it is eligible to apply for funds;
(iv) Of the effective date of its eligibility to participate in those programs; and
(v) Of the conditions under which it may participate in those programs;
(3) If the Secretary receives an application under paragraph (b)(2) of this section, the Secretary notifies the institution whether it continues to be certified, or whether it reestablished its eligibility and certification to participate in the title IV, HEA programs and the scope of such approval.
(4) If the Secretary receives an application under paragraph (c)(1) of this section for an additional location, the Secretary notifies the institution whether the location is eligible or ineligible to participate in the title IV, HEA programs, and the date of eligibility if the location is determined eligible;
(5) If the Secretary receives an application under paragraph (c)(2) of this section for an increase in the level of program offering, or for an additional educational program under paragraph (c)(3) of this section, the Secretary notifies the institution whether the program qualifies as an eligible program, and if the program qualifies, the date of eligibility; and
(6) If the Secretary receives an application under paragraphs (c)(4) or (c)(5) of this section to have a branch campus certified to participate in the title IV, HEA programs as a branch campus, the Secretary notifies the institution whether that branch campus is certified to participate and the date that the branch campus is eligible to begin participation.
(f)
(ii) An institution described in paragraph (f)(1)(i) of this section may disburse title IV, HEA program funds to its students if the institution submits to the Secretary a materially complete renewal application in accordance with the provisions of 34 CFR 668.13(b)(2), and has not received a final decision from the Department on that application.
(2)(i) Except as provided under paragraph (f)(2)(ii) of this section and 34 CFR 668.26, if a private nonprofit, private for-profit, or public institution submits an application under paragraph (b)(2)(ii) or (b)(2)(iii) of this section because it has undergone or will undergo a change in ownership that results in a change of control or a change in status, the institution may not disburse title IV, HEA program funds to students attending that institution after the change of ownership or status until the institution receives the Secretary's notification that the institution is eligible to participate in those programs.
(ii) An institution described in paragraph (f)(2)(i) of this section may disburse title IV, HEA program funds to its students if the Secretary issues a provisional extension of certification under paragraph (g) of this section.
(3) If an institution must apply to the Secretary under paragraphs (c)(1) through (c)(4) of this section, the institution may not disburse title IV, HEA program funds to students attending the subject location, program, or branch until the institution receives the Secretary's notification that the location, program, or branch is eligible to participate in the title IV, HEA programs.
(4) If an institution applies to the Secretary under paragraph (c)(5) of this section to convert an eligible location to a branch campus, the institution may continue to disburse title IV, HEA program funds to students attending that eligible location.
(5) If an institution does not apply to the Secretary to obtain the Secretary's approval of a new location, program, increased level of program offering, or branch, and the location, program, or branch does not qualify as an eligible location, program, or branch of that institution under this part and 34 CFR part 668, the institution is liable for all title IV, HEA program funds it disburses to students enrolled at that location or branch or in that program.
(g)
(2) For purposes of this section, a private nonprofit institution, a private for-profit institution, or a public institution submits a materially complete application if it submits a fully completed application form designated by the Secretary supported by—
(i) A copy of the institution's State license or equivalent document that—as of the day before the change in ownership—authorized or will authorize the institution to provide a program of postsecondary education in the State in which it is physically located;
(ii) A copy of the document from the institution's accrediting association that—as of the day before the change in ownership—granted or will grant the institution accreditation status, including approval of any non-degree programs it offers;
(iii) Audited financial statements of the institution's two most recently completed fiscal years that are prepared and audited in accordance with the requirements of 34 CFR 668.23; and
(iv) Audited financial statements of the institution's new owner's two most recently completed fiscal years that are prepared and audited in accordance with the requirements of 34 CFR 668.23, or equivalent information for that owner that is acceptable to the Secretary.
(h) Terms of the extension. (1) If the Secretary approves the institution's materially complete application, the Secretary provides the institution with a provisional Program Participation Agreement (PPA). The provisional PPA extends the terms and conditions of the program participation agreement that were in effect for the institution before its change of ownership.
(2) The provisional PPA expires on the earlier of—
(i) The date on which the Secretary signs a new program participation agreement;
(ii) The date on which the Secretary notifies the institution that its application is denied; or
(iii) The last day of the month following the month in which the change of ownership occurred, unless the provisions of paragraph (h)(3) of this section apply.
(3) If the provisional PPA will expire under the provisions of paragraph (h)(2)(iii) of this section, the Secretary extends the provisional PPA on a month-to-month basis after the expiration date described in paragraph (h)(2)(iii) of this section if, prior to that expiration date, the institution provides the Secretary with—
(i) A “same day” balance sheet showing the financial position of the institution, as of the date of the ownership change, that is prepared in accordance with Generally Accepted Accounting Principles (GAAP) published by the Financial Accounting Standards Board and audited in accordance with Generally Accepted Government Auditing Standards (GAGAS) published by the U.S. General Accounting Office;
(ii) If not already provided, approval of the change of ownership from the State in which the institution is located by the agency that authorizes the institution to legally provide postsecondary education in that State;
(iii) If not already provided, approval of the change of ownership from the institution's accrediting agency; and
(iv) A default management plan unless the institution is exempt from providing that plan under 34 CFR 668.14(b)(15).
(a)
(1) Its name, the name of a branch, or the name of a previously reported location.
(2) Its address, the address of a branch, or the address of a previously reported location.
(3) Its establishment of an accredited and licensed additional location at which it offers or will offer 50 percent or more of an educational program if the institution wants to disburse title IV, HEA program funds to students enrolled at that location, under the provisions in paragraph (d) of this section.
(4) The way it measures program length (
(5) A decrease in the level of program offering (
(6) A person's ability to affect substantially the actions of the institution if that person did not previously have this ability. The Secretary considers a person to have this ability if the person—
(i) Holds alone or together with another member or members of his or her family, at least a 25 percent “ownership interest” in the institution as defined in § 600.31(b);
(ii) Represents or holds, either alone or together with other persons, under a voting trust, power of attorney, proxy, or similar agreement at least a 25 percent “ownership interest” in the institution, as defined in § 600.31(b); or
(iii) Is a general partner, the chief executive officer, or chief financial officer of the institution.
(7) The individual the institution designates under 34 CFR 668.16(b)(1) as its title IV, HEA Program administrator.
(8) The closure of a branch campus or additional location that the institution was required to report to the Secretary.
(9) The governance of a public institution.
(b)
(c)
(d)
(e)
(f)
(1) Parent, sibling, spouse or child;
(2) Spouse's parent or sibling;
(3) Child's spouse; and
(4) Sibling's spouse.
The additions and revisions read as follows:
(a)(1) Except as provided in paragraph (a)(2) of this section, a private nonprofit, private for-profit, or public institution that undergoes a change in ownership that results in a change in control ceases to qualify as an eligible institution upon the change in ownership and control. A change in ownership that results in a change in control includes any change by which a person who has or thereby acquires an ownership interest in the entity that owns the institution or the parent corporation of that entity, acquires or loses the ability to control the institution.
(2) If a private nonprofit, private for-profit, or public institution has undergone a change in ownership that results in a change in control, the Secretary may, under the provisions of § 600.20(g) and (h), continue the institution's participation in the title IV, HEA programs on a provisional basis, provided that the institution submits, under the provisions of § 600.20(g), a materially complete application—
(i) No later than 10 business days after the change occurs; or
(ii) For an institution owned by a publicly-traded corporation, no later than 10 business days after the institution knew, or should have known of the change based upon SEC filings, that the change occurred.
(b) * * *
(2) Ownership or ownership interest does not include an ownership interest held by—
(i) A mutual fund that is regularly and publicly traded;
(ii) A U.S. institutional investor, as defined in 17 CFR 240.15a-6(b)(7);
(iii) A profit-sharing plan of the institution or its corporate parent, provided that all full-time permanent employees of the institution or corporate parent are included in the plan; or
(iv) An Employee Stock Ownership Plan (ESOP).
(c) * * *
(2)
(i) A person acquires such ownership and control of the corporation so that the corporation is required to file a Form 8K with the SEC notifying that agency of the change in control; or
(ii) (A) A person who is a controlling shareholder of the corporation ceases to be a controlling shareholder. A controlling shareholder is a shareholder who holds or controls through agreement both 25 percent or more of the total outstanding voting stock of the corporation and more shares of voting stock than any other shareholder. A controlling shareholder for this purpose does not include a shareholder whose sole stock ownership is held as a U.S. institutional investor, as defined in 17 CFR 240.15a-6(b)(7), held in mutual funds, held through a profit-sharing plan, or held in an Employee Stock Ownership Plan (ESOP).
(B) When a change of ownership occurs as a result of paragraph (c)(2)(ii)(A) of this section, the institution may submit its most recent quarterly financial statement as filed with the SEC, along with copies of all other SEC filings made after the close of the fiscal year for which a compliance audit has been submitted to the Department of Education, instead of the “same day” balance sheet.
(C) If a publicly-traded institution is provisionally certified due to a change in ownership under paragraph (c)(2)(ii) of this section, and that institution experiences another change of ownership under paragraph (c)(2)(ii) of this section, an approval of the subsequent change in ownership does not extend the original expiration date for the provisional certification provided that any current controlling shareholder was listed on the change of ownership application for which the original provisional approval was granted.
(6)
(7)
(i) The new governing authority is in the same State as included in the institution's program participation agreement; and
(ii) The new governing authority has acknowledged the public institution's continued responsibilities under its program participation agreement.
(d) * * *
(7) A change in status as a for-profit, nonprofit, or public institution.
20 U.S.C. 1001, 1002, 1003, 1085, 1091, 1091b, 1092, 1094, 1099c, and 1099c-1, unless otherwise noted.
(b) * * *
(2) * * *
(ii) If an institution provides an educational program using a semester, trimester, or quarter system, or in clock hours, the Secretary considers that the institution provides one week of instructional time in that program during any week the institution provides for that program—
(A) At least one day of regularly scheduled instruction or examinations; or
(B) After the last scheduled day of classes for a term, at least one day of study for initial examinations.
(iii) If an institution provides an educational program using credit hours but not a semester, trimester, or quarter system, the Secretary considers that the institution provides one week of instructional time in that program during any week the institution provides for that program—
(A) At least 12 hours of regularly scheduled instruction or examinations; or
(B) After the last scheduled day of classes for a payment period, at least 12 hours of study for final examinations.
(iv) Instructional time does not include any vacation periods, homework, or periods of orientation or counseling.
(a)
(b)
(c)
(1) The ineligible institution or organization has not had its eligibility to participate in the title IV, HEA programs terminated by the Secretary, or has not voluntarily withdrawn from participation in those programs under a termination, show-cause, suspension, or similar type proceeding initiated by the institution's State licensing agency, accrediting agency, guarantor, or by the Secretary;
(2) The educational program otherwise satisfies the requirements of § 668.8; and
(3)(i) The ineligible institution or organization provides not more than 25 percent of the educational program; or
(ii)(A) The ineligible institution or organization provides more than 25 percent but not more than 50 percent of the educational program;
(B) The eligible institution and the ineligible institution or organization are not owned or controlled by the same individual, partnership, or corporation; and
(C) The eligible institution's accrediting agency, or if the institution is a public postsecondary vocational educational institution, the State agency listed in the
(d)
(2) In the case of a written arrangement between eligible institutions, the institutions may agree in writing to have any eligible institution in the written arrangement make those calculations and disbursements, and the Secretary does not consider that institution to be a third-party servicer for that arrangement.
(3) The institution that calculates and disburses a student's title IV, HEA program assistance under paragraph (d)(1) or (d)(2) of this section must—
(i) Take into account all the hours in which the student enrolls at each institution that apply to the student's degree or certificate when determining the student's enrollment status and cost of attendance; and (ii) Maintain all records regarding the student's eligibility for and receipt of title IV, HEA program funds.
(b) * * *
(3)(i) If an institution provides an educational program using a semester, trimester, or quarter system, or in clock hours, the Secretary considers that the institution provides one week of instructional time in that program during any week the institution provides—
(A) At least one day of regularly scheduled instruction or examinations; or
(B) After the last scheduled day of classes for a term, at least one day of study for final examinations.
(ii) If an institution provides an educational program using credit hours but not a semester, trimester, or quarter system, the Secretary considers that the institution provides one week of instructional time in that program during any week the institution provides—
(A) At least 12 hours of regularly scheduled instruction or examinations; or
(B) After the last scheduled day of classes for a payment period, at least 12 hours of study for final examinations.
(4) Instructional time does not include any vacation periods, homework, or periods of orientation or counseling.
(a)
(2) Except as provided in paragraph (a)(3) of this section, if an institution wishes to participate for the first time in the title IV, HEA programs or has undergone a change in ownership that results in a change in control as described in 34 CFR 600.31, the institution must require the following individuals to complete title IV, HEA program training provided or approved by the Secretary no later than 12 months after the institution executes its program participation agreement under § 668.14:
(i) The individual the institution designates under § 668.16(b)(1) as its title IV, HEA program administrator.
(ii) The institution's chief administrator or a high level institutional official the chief administrator designates.
(3)(i) An institution may request the Secretary to waive the training requirement for any individual described in paragraph (a)(2) of this section.
(ii) When the Secretary receives a waiver request under paragraph (a)(3)(i) of this section, the Secretary may grant or deny the waiver, require another institutional official to take the training, or require alternative training.
(a) Before an institution may disburse title IV, HEA program funds to a student who previously attended another eligible institution, the institution must use information it obtains from the Secretary, through the National Student Loan Data System (NSLDS) or its successor system, to determine—
(1) Whether the student is in default on any title IV, HEA program loan;
(2) Whether the student owes an overpayment on any title IV, HEA program grant or Federal Perkins Loan;
(3) For the award year for which a Federal Pell Grant is requested, the student's scheduled Federal Pell Grant and the amount of Federal Pell Grant funds disbursed to the student;
(4) The outstanding principal balance of loans made to the student under each of the title IV, HEA loan programs; and
(5) For the academic year for which title IV, HEA aid is requested, the amount of, and period of enrollment for, loans made to the student under each of the title IV, HEA loan programs.
(b)(1) If a student transfers from one institution to another institution during the same award year, the institution to which the student transfers must request from the Secretary, through NSLDS, updated information about that student so it can make the determinations required under paragraph (a) of this section; and
(2) The institution may not make a disbursement to that student for seven days following its request, unless it receives the information from NSLDS in response to its request or obtains that information directly by accessing NSLDS, and the information it receives allows it to make that disbursement.
(a) * * *
(3) * * *
(ii) Either in writing or electronically. If the institution sends the notice electronically, it must confirm receipt by the student or parent of the electronic notification and must maintain documentation of that confirmation.
42 U.S.C. 2751-2756b, unless otherwise noted.
(b) * * *
(1) An institution must follow the record retention and examination provisions in this part and in 34 CFR 668.24.
(2) The institution must also establish and maintain program and fiscal records that—
(i) Include a certification by the student's supervisor, an official of the institution or off-campus agency, that each student has worked and earned the amount being paid. The certification must include or be supported by, for students paid on an hourly basis, a time record showing the hours each student worked in clock time sequence, or the total hours worked per day;
(ii) Include a payroll voucher containing sufficient information to support all payroll disbursements;
(iii) Include a noncash contribution record to document any payment of the institution's share of the student's earnings in the form of services and equipment (see § 675.27(a)); and
(iv) Are reconciled at least monthly.
20 U.S.C. 1070a, unless otherwise noted.
Office of Postsecondary Education, Department of Education.
Final regulations.
The Secretary amends the regulations governing the Federal Perkins (Perkins) Loan Program, Federal Family Education Loan (FFEL) Program, and William D. Ford Federal Direct Loan (Direct Loan) Program to strengthen and improve the processes for granting loan discharges based on a borrower's death or total and permanent disability.
Effective July 1, 2002, except the following provisions of these regulations are effective July 1, 2001: §§ 674.9(h)(3), 674.51(s), 674.61(a), 682.200(b), the redesignations of § 682.201(a)(5)-(a)(7), 682.201(a)(6)(iii), 682.402(b)(2) and (3), 682.402(g)(1)(iii), 685.200(a)(1)(iv)(A) and (B), and 685.212(a).
For additional information see the discussion of effective dates under the Analysis of Comments and Changes section that follows.
For the FFEL and Perkins Loan Programs, Mr. Brian Smith, or for the Direct Loan Program, Mr. Jon Utz; U.S. Department of Education, 400 Maryland Avenue, SW., Room 3045, Regional Office Building No. 3, Washington, DC 20202-5345. Telephone: (202) 708-8242. If you use a telecommunications device for the deaf (TDD), you may call the Federal Information Relay Service (FIRS) at 1-800-877-8339.
Individuals with disabilities may obtain this document in an alternative format (
On August 2, 2000, the Secretary published a notice of proposed rulemaking (NPRM) for the Perkins, FFEL, and Direct Loan programs in the
Amending §§ 674.61, 682.402, and 685.212 to require that an original or certified copy of a death certificate be provided to support a discharge of a loan based on death, although other documentation may be accepted under unusual circumstances (page 47636).
Amending §§ 674.51, 682.200, and 685.102 to revise the definition of “totally and permanently disabled” (page 47636).
Amending §§ 674.61(b)(3)(ii), 682.402(c)(2)(ii), and 685.213(b)(2) to allow disability discharges to be granted based on documentation from the Social Security Administration (SSA) in lieu of a physician's certification of total and permanent disability.
Amending §§ 674.61(b)(3)-(6), 682.402(c)(2)-(12), and 685.213(b) to change the process for considering applications for a disability discharge on a student loan by placing loans in a conditional discharge status for up to three years, before granting a final discharge. We proposed requiring FFEL and Perkins loans to be assigned to us after a determination by the loan holder or guaranty agency that the borrower meets the criteria for a total and permanent disability discharge (pages 47637-47638).
Amending §§ 674.61(b)(1), (6), and (7), 682.402(c)(1), (12), and (13), and 685.213(a)(1) and (d) to establish the rules for granting a borrower a conditional discharge if the borrower appears to meet the requirements for a total and permanent disability discharge. When a loan is in a conditional discharge status, collection activity on the loan is suspended for up to three years from the date of the onset of the disability.
Amending §§ 674.61(b)(2), (8) and (9), 682.402(c)(14) and (15), and 685.213(a)(2) and (c) to discharge the loan if the borrower continues to meet the disability discharge criteria at the end of the three-year conditional discharge period.
If the borrower does not the disability discharge criteria collection activity resumes, but the borrower is not obligated to pay interest that has accrued on the loan during the conditional discharge period (page 47638).
Amending §§ 674.61(b)(11) and (12), 682.402(r)(2) and (3), and 685.212(g)(2) to require that payments received by a Perkins Loan school, FFEL lender or guaranty agency on a loan that has been assigned to us prior to a final determination of eligibility for a disability discharge must be sent to us. We will apply those payments to the loan. If the loan is ultimately discharged, the payments will be returned to the sender (page 47639).
Amending §§ 674.9, 682.201, and 685.200 to allow a borrower whose loan is in a conditional disability discharge period to be eligible for additional title IV loans if a physician or the SSA certifies that the borrower is able to engage in substantial gainful activity; the borrower acknowledges that neither the conditionally discharged loan nor the new loan can be discharged on the basis of the borrower's current disability unless that disability substantially deteriorates; and collection activity resumes on the conditionally discharged loan (page 47639).
These final regulations contain changes from the NPRM that are explained in the Analysis of Comments and Changes that follows.
The regulations in this document were developed through the use of negotiated rulemaking. Section 492 of the Higher Education Act requires that, before publishing any proposed regulations to implement programs under title IV of the Act, the Secretary obtain public involvement in the development of the proposed regulations. After obtaining advice and recommendations, the Secretary must conduct a negotiated rulemaking process to develop the proposed regulations.
These regulations were published in proposed form on August 2, 2000. The negotiated rulemaking committee was unable to reach consensus on the proposed regulations. The Secretary invited comments on the proposed regulations by September 18, 2000. In response to the Secretary's invitation in the NPRM, 46 parties submitted comments on the proposed regulations. An analysis of the comments and of the changes in the regulations since publication of the NPRM follows.
We discuss substantive issues under the sections of the regulations to which they pertain. Generally, we do not address technical and other minor changes—and suggested changes the law does not authorize the Secretary to make.
Even though we will delay the implementation of the conditional discharge until July 1, 2002, we have decided that for any loan that is discharged due to total and permanent disability on or after July 1, 2001 through June 30, 2002, the borrower must reaffirm that loan if the borrower receives a new title IV loan within three years from the date that the borrower became totally and permanently disabled as certified by the physician. These provisions, §§ 674.9(h)(3), 682.201(a)(6)(iii), and 685.200(a)(1)(iv)(A) and (B) will become effective on July 1, 2001.
All other changes related to implementing the new processes for granting total and permanent disability discharges will become effective on July 1, 2002.
One commenter proposed an alternative approach whereby a loan holder would be required to notify the Secretary upon learning of a borrower's death and the Secretary would assume the responsibility of obtaining confirmation.
Two commenters noted that obtaining an original or certified copy of the death certificate may not be the only official means of confirming an individual's death. One of the commenters reported that some State social service agencies are beginning to put public records on their websites, and suggested that loan holders should be allowed to approve death discharges if they can obtain electronic verification of an individual's death directly from an official source.
One commenter recommended that § 682.402(b)(2) be revised to provide that a guaranty agency must maintain documentation of death discharges based on alternative documentation “as required in § 682.414(a).” The commenter believed that this change would clarify that documentation of exceptional circumstances must be maintained within the borrower's record as is the case with all other claim documentation.
We are interested in the commenters' suggestions regarding the possibility of using electronic records and we will consider whether to explore these other means for obtaining official proof of death that could potentially be used in the future.
Finally, we do not believe it is necessary to cross-reference the general record keeping requirements in § 682.414.
On the other hand, we do not believe it is appropriate to revise the definition of “totally and permanently disabled,” to include an earnings limit. First of all, such an addition would be inconsistent with the rest of the definition which refers to a borrower who cannot work and earn money. Second, as a practical matter, it would significantly complicate the process for determining if the borrower is disabled by requiring the borrower to submit income information as well as the doctor's certification as part of the initial application.
The commenters who stated the view that the findings in the OIG's report do not justify the changes proposed in the NPRM suggested that we conduct a comprehensive examination of the specific accounts supporting the findings in the OIG's report before making changes to the existing process for granting total and permanent disability discharges. They believe that such an examination is necessary to establish the reason for the exceptions, to identify possible vulnerabilities in the system for granting disability discharges, and to allow us to design a tailored solution to address the problem.
Several commenters objected to the proposed change because they believe it would cause undue hardship to borrowers. They contend that the complexity of the proposed disability discharge procedures would create unnecessary anxiety and confusion for disabled borrowers, particularly those afflicted with severe mental or emotional impairments.
One commenter raised concerns about the effect the proposed change would have on potential borrowers who might think twice about obtaining student loans for their future educational needs. The commenter believed that the conditional discharge approach may potentially discourage a person from pursuing higher education for fear of an inability to repay his or her loans due to medical difficulties.
We disagree with the commenters' assumption that the three-year conditional discharge period will create undue anxiety for borrowers. Borrowers will be informed up front of the criteria they must meet to qualify for a disability discharge. Borrowers who continue to meet the eligibility criteria will receive a final discharge at the close of the conditional period. Moreover, borrowers suffer no negative consequences during the conditional discharge period. No collection activity or adverse credit reporting occurs during the conditional discharge period. If a borrower's situation changes during this period, we believe the borrower should be expected to repay the student loan. However, even if collection activity resumes on the loan, the borrower is not obligated to pay any interest that accrued during the conditional discharge period.
We disagree with the claim by one of the commenters that the conditional discharge approach will be particularly harmful to borrowers with severe mental or emotional impairments. As we noted in the preamble to the NPRM (65 FR at 47635), we are not aware of any other major federal program that provides disability benefits based on a one-time review of an individual's condition, and we did not receive any comments suggesting otherwise. The adoption of the policies reflected in this regulation will make the processes for discharges of student loans more comparable to that of other federal
We strongly disagree with the commenter who suggested that the new regulations would somehow discourage borrowers from taking out student loans to further their education. Most borrowers, even those with some pre-existing condition, recognize the value of postsecondary education and appreciate the opportunity and access to education that student loans provide them. We do not share the commenter's apparent belief that a borrower will be dissuaded from pursuing an education based on the standard for a disability discharge.
Several commenters also claimed that implementation of the proposed regulations would result in considerable expense for taxpayers and loan administrators, and questioned whether the benefits of the regulations justify the expense.
In regard to the commenters' claim that the costs of the new process will exceed the benefits, our analysis does not support this claim. Moreover, even a small percentage of borrowers who were ineligible for loan discharge calls the integrity of the loan discharge process into question and may threaten public support for the title IV student loan programs.
Many commenters recommended that we withdraw the proposed regulations.
A couple of commenters stated that the proposed regulations are unnecessary because it is feasible to identify abusers by cross-referencing tax information with discharge information and to reverse a discharge granted to an ineligible borrower.
Some commenters questioned whether we have the legal authority to impose a conditional discharge on borrowers, since a conditional discharge is not specifically mentioned in the statute.
We also disagree with the commenters who suggested that the regulations are unnecessary because we already have the ability to revoke discharges. Generally, a final agency decision cannot be changed based on events occurring after the decision. Accordingly, we believe that it is unlikely that loan discharges for borrowers who met the eligibility criteria could be easily reinstated and legally enforced at a later date.
One commenter pointed out that reinstatement of loans in cases where a borrower has requested another title IV loan subsequent to a disability discharge has been a workable element of the title IV program in the past. In addition, the Department has routinely reinstated nonconditionally discharged loans in cases where the determination of discharge eligibility was based on incorrect or changing information, as is often the case with closed school revisions.
One commenter recommended that we rely on State or Federal agencies, such as the Social Security Administration, that are specifically charged by law with making disability determinations. The commenter believes that these agencies are far more capable of making fair, uniform, and reliable disability determinations than loan holders or guaranty agencies. The commenter believes that placing disability discharge determinations in the hands of a knowledgeable third party is the best way to ensure the integrity and fairness of all such determinations.
One commenter recommended that we turn over verified fraudulent disability claims to the U.S. Attorney's Office for possible prosecution. The commenter believes that if it became known that the Department vigorously pursues fraud, it would deter physicians from falsely certifying disability request forms.
One commenter recommended that we require lenders to offer credit insurance to student loan borrowers at reasonable rates. This insurance would repay the full loan in cases of authentic total and permanent disability that can be quickly and fairly verified. Borrowers who accept the credit insurance could be given reduced interest points as an incentive.
Another commenter suggested that Perkins Loan holders be allowed to continue to make disability determinations, which would be reviewed as part of the annual audit. In cases where the auditors question the holder's judgment, we would disallow the discharge, and the loan holder
Two commenters recommended that we reinstate the deferment for temporary total disability. By doing so, borrowers would receive the relief they need, and lenders and schools would have the ability to determine, based on the physicians' certification, if the disability is total and permanent at the end of an appropriate period of time. Loan holders could also monitor the status of the borrower during the deferment period for signs of substantial gainful employment.
We have explored the option of relying on determinations by other agencies, such as the Social Security Administration (SSA). We have found that most of these agencies have disability criteria that are less stringent than ours because they provide disability payments or benefits based on the borrower's continuing disability. If an individual's condition improves, the agency stops providing the benefits. We believe that with a discharge—a one-time cancellation of a borrower's obligation to repay a debt of thousands of dollars—there is a need to use a higher standard. As a result, we have decided against using SSA disability determinations. See “Use of Social Security Disability Documentation” for a further discussion of this issue.
We also do not believe that reviews of disability determinations with annual audits would be practical. Auditors do not have the expertise to make judgments about a holder's determination in disability cases. We believe that the centralized process provided in the regulations provides for a more consistent review of disability discharge approvals.
We believe that the commenter's suggestion that we require lenders to offer credit insurance would only increase costs to all student loan borrowers and would not address the problem of providing the discharge to ineligible borrowers. Moreover, this proposal and the proposal to reinstate the temporary total disability deferment for all borrowers, would require statutory changes.
One commenter supported the concept of using SSA documentation as an alternative to a physician's certification only if it were allowed to be used in all cases. The commenter felt that, if it were not allowed in all cases, it would be too difficult to explain to borrowers when SSA documentation would be acceptable, and when it would not.
One commenter believed that using SSA documentation to establish that a borrower is totally and permanently disabled would be the most sensible approach, and expressed hopes that we would be able to implement this approach. Another commenter noted that the ability to accept a SSA disability determination as an alternative to a physician's certification would reduce administrative burden. However, the commenter has seen SSA disability documentation and was concerned that the SSA's eligibility requirements are not as stringent as the current requirements for discharging student loans based on total and permanent disability.
One commenter, representing organizations that specialize in consumer issues, believed that the language of the preamble to the proposed regulations might suggest to some readers that any disability determination from the SSA would be sufficient to establish a borrower's eligibility for a total and permanent disability discharge of a title IV loan. However, the commenter believed that our intent is to allow the use of SSA documentation only for individuals whom the SSA has placed in the highest of three continuing disability review categories, “medical improvement not expected.” The commenter felt that this approach would benefit very few borrowers, since the “medical improvement not expected” category consists of individuals with serious conditions that are usually progressive and possibly fatal and who would probably have no trouble obtaining a physician's certification for a discharge. The commenter believed that we should go further and use the SSA's continuing disability review categories, as a basis for determining which borrower's discharges to review for possible revocation within a limited time period. The commenter felt that borrowers should be able to submit documentation of any SSA disability benefits award as sufficient evidence to warrant a disability discharge.
In the preamble to the NPRM we indicated that we would work with SSA to determine whether there is documentation that the SSA provides to some individuals that would be comparable to a physician's certification that a borrower is totally and permanently disabled according to our definition. After extensive discussion and examination, however, we have determined that there is no
We believe that the new procedures will improve the consistency of decisions on disability discharge claims. Under the new process, we will be able to develop standards and procedures for reviewing such claims and to communicate those standards to the loan holders and guaranty agencies.
One commenter proposed additional language: “The notice must identify the address where payments are to be sent.”
Some commenters recommended that we measure income on a calendar-year basis because attempting to measure income over a period not in common usage might lead to a lack of clarity and consistency.
While we do not agree that § 682.201(a)(5) should be removed, we do support the commenters' suggestion that a borrower be required to acknowledge in writing that collection activity will resume on any conditionally discharged loan.
One commenter reported that currently even the largest colleges and universities receive only a handful of disability claims a year and that the Perkins Loan Program has not experienced the same increase in disability claims as the FFEL program in recent years.
Another commenter indicated that they, in fact, expect the number of applicants for disability discharges in the Perkins Loan Program to increase under the new rule. The commenter believes that borrowers will dispute school denial of discharges and force schools to assign the account to the Department.
Many commenters from schools in the Perkins Loan Program also expressed concern that the proposed regulations will compromise their ability to interact with disabled students and their families in a flexible manner.
We disagree with the commenter who speculated that the regulations will increase the number of Perkins Loan disability discharges. Schools will still have the responsibility to review disability discharge requests and the supporting documentation and will have the same financial incentives to prevent inappropriate disability discharges. Except for the assignment requirement, the regulations will not require any changes to a school's current process for reviewing and approving or denying disability discharge requests. Therefore, we do not believe that the regulations will prevent schools from interacting with students in a flexible manner.
Some commenters agreed with our proposal to require a school to assign Perkins loans to us after it approves the borrower's disability claim. Other commenters argued that the loan should stay with the institution. One commenter recommended that we reimburse the institution for the loan. Another suggested that we return the loan to the institution if we deny the disability claim.
Other commenters were concerned that a loan assigned to us would be subject to an initial review and could be rejected. They recommended that § 674.61(b)(3) be revised to require the school to “* * * automatically and irrevocably assign the loan to the Secretary * * *”
Several commenters recommended that the assignment process for these loans should be simplified. The current assignment process is voluntary. They argued that it is not appropriate to require mandatory assignment of accounts on which the borrower has requested a disability discharge. They recommended that a special assignment process be developed for disability discharges.
We have reviewed these final regulations in accordance with Executive Order 12866. Under the terms of the order we have assessed the potential costs and benefits of this regulatory action.
The potential costs associated with the final regulations are those resulting from statutory requirements and those we have determined to be necessary for administering these programs effectively and efficiently. Elsewhere in this
In assessing the potential costs and benefits—both quantitative and qualitative—of these final regulations, we have determined that the benefits of the regulations justify the costs.
We have also determined that this regulatory action does not unduly interfere with State, local, and tribal governments in the exercise of their governmental functions.
We summarized the potential costs and benefits of these final regulations in the preamble to the NPRM (65 FR 47639). Based on the expectation that all provisions would be effective July 1, 2001, we estimated a savings of $72 million over FY 2001-2005 as a result of borrowers who would have received a discharge losing eligibility during the three-year conditional period. The final regulations include a one-year delay in implementing the conditional discharge provisions for total and permanent disability. Therefore, under the final regulations the Department estimates a revised savings of $59 million over FY 2001-2005.
The Paperwork Reduction Act of 1995 does not require you to respond to a collection of information unless it displays a valid OMB control number. We display the valid OMB control numbers assigned to the collections of information in these final regulations at the end of the affected sections of the regulations.
In the NPRM we requested comments on whether the proposed regulations would require transmission of information that any other agency or authority of the United States gathers or makes available.
Based on the response to the NPRM and our review, we have determined that these final regulations do not require transmission of information that any other agency or authority of the United States gathers or makes available.
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Administrative practice and procedure, Colleges and universities, Education, Loan programs-education, Reporting and recordkeeping requirements, Student aid, Vocational education.
20 U.S.C. 1087aa-1087ii and 20 U.S.C. 421-429, unless otherwise noted.
(c) * * *
(3) * * *
(ii) * * *
(F) Assigned to the Secretary in accordance with § 674.61(b).
The additions and revisions read as follows:
(h)(3) In the case of a borrower whose previous loan under title IV of the HEA was discharged due to a total and permanent disability on or after July 1, 2001 and before July 1, 2002, meets the requirements of (h)(1) and (h)(2) of this section. If the borrower receives another loan within three years from the date the borrower became totally and permanently disabled, as certified by the physician, the borrower must reaffirm the previously discharged loan.
(i) In the case of a borrower whose previous loan under title IV of the HEA was conditionally discharged based on an initial determination that the borrower was totally and permanently disabled, the borrower must—
(1) Comply with the requirements of paragraphs (h)(1) and (h)(2) of this section; and
(2) Sign a statement acknowledging that—
(i) The loan that has been conditionally discharged prior to a final determination of total and permanent disability cannot be discharged in the future on the basis of any impairment present when the borrower applied for a total and permanent disability discharge or when a new loan is made, unless that impairment substantially deteriorates; and
(ii) Collection activity will resume on any loan in a conditional discharge period, as described in § 674.61(b)(9).
(j) Does not have any loans under title IV of the HEA on which collection activity has been suspended based on a conditional determination that the borrower was totally and permanently disabled. If a borrower applies for a loan under title IV of the HEA during the conditional discharge period described in §§ 674.61(b), 682.402(c), or 685.213(a), the suspension of collection activity must be ended before the borrower becomes eligible to receive any additional loans.
(s)
The revisions read as follows:
(a)
(b)
(2) A borrower satisfies the criteria for a discharge of a loan based on a total and permanent disability if, during and at the end of the three-year conditional discharge period described in paragraph (b)(1) of this section—
(i) The borrower's annual earnings from employment do not exceed 100 percent of the poverty line for a family of two, as determined in accordance with the Community Service Block Grant Act; and
(ii) The borrower does not receive a new loan under the Perkins, FFEL or Direct Loan programs, except for a FFEL or Direct Consolidation Loan that does not include any loans that are in a conditional discharge status.
(3) If a borrower becomes totally and permanently disabled after receiving a Defense, NDSL, or Perkins loan, the institution must assign the loan to the Secretary if the borrower submits a certification by a physician and the institution reviewed the application and
(4) At the time the loan is assigned to the Secretary the institution must notify the borrower that the loan has been assigned to the Secretary for determination of eligibility for a total and permanent disability discharge.
(5) If the Secretary determines that the certification provided by the borrower does not support the conclusion that the borrower meets the criteria for a total and permanent disability discharge, the Secretary notifies the borrower that the application for a disability discharge has been denied, and that the loan is due and payable under the terms of the promissory note.
(6) If the Secretary makes an initial determination that the borrower is totally and permanently disabled, the Secretary notifies the borrower that the loan will be in a conditional discharge status for a period of up to three years after the date the borrower became totally and permanently disabled as certified under § 674.61(b)(3). This notification identifies the conditions of the conditional discharge period specified in paragraphs (b)(6) through (b)(9) of this section and specifies that all or part of the three-year period may predate the Secretary's initial determination.
(7) During the conditional discharge period, the borrower—
(i) Is not required to make any payments on the loan;
(ii) Is not considered past due or in default on the loan, unless the loan was past due or in default at the time the conditional discharge was granted;
(iii) Must promptly notify the Secretary of any changes in address or phone number;
(iv) Must promptly notify the Secretary if the borrower's annual earnings from employment exceed the amount specified in paragraph (b)(2)(i) of this section; and
(v) Must provide the Secretary, upon request, with additional documentation or information related to the borrower's eligibility for discharge under this section.
(8) If, during and at the end of the conditional discharge period, the borrower continues to satisfy the eligibility criteria for a total and permanent disability discharge, as described in paragraph (b)(2) of this section, the balance of the loan is discharged.
(9) If, at any time during or at the end of the three-year conditional discharge period, the borrower does not continue to meet the eligibility requirements for total and permanent disability discharge, the Secretary resumes collection activity on the loan. The Secretary does not require the borrower to pay any interest that accrued on the loan from the date of the initial determination described in paragraph (b)(6) of this section through the end of the conditional discharge period.
(10) If the institution receives any payments from or on behalf of the borrower on or attributable to a loan that has been assigned to the Secretary for determination of eligibility for a total and permanent disability discharge, the institution must forward those payments to the Secretary for crediting to the borrower's account. At the same time that the institution forwards the payment, it must notify the borrower that there is no obligation to make payments on the loan while it is conditionally discharged prior to a final determination of eligibility for a total and permanent disability discharge, unless the Secretary directs the borrower otherwise.
(11) When the Secretary makes a final determination to discharge the loan, the Secretary returns to the sender any payments received on the loan after the date the borrower became totally and permanently disabled.
20 U.S.C. 1071 to 1087-2, unless otherwise noted.
(b) * * *
The additions and revisions read as follows:
(a) * * *
(5) The suspension of collection activity has been lifted from any loan on which collection activity had been suspended based on a conditional determination that the borrower was totally and permanently disabled under § 682.402(c).
(6) In the case of a borrower whose prior loan under title IV of the Act was discharged after a final determination of total and permanent disability, the student must—
(i) Obtain certification from a physician that the borrower is able to engage in substantial gainful activity;
(ii) Sign a statement acknowledging that the FFEL loan the borrower receives cannot be discharged in the future on the basis of any impairment present when the new loan is made, unless that impairment substantially deteriorates; and
(iii) In the case of a borrower whose previous loan under title IV of the Act was discharged due to a total and permanent disability on or after July 1, 2001 and before July 1, 2002, meets the requirements of paragraphs (a)(6)(i) and (a)(6)(ii) of this section. If the borrower receives another loan within three years from the date that the borrower became totally and permanently disabled, as certified by the physician, the borrower must reaffirm the previously discharged loan.
(7) In the case of a borrower whose prior loan under title IV of the HEA was conditionally discharged based on an initial determination that the borrower was totally and permanently disabled, the borrower must—
(i) Comply with the requirements of paragraphs (a)(6)(i) and (a)(6)(ii) of this section; and
(ii) Sign a statement acknowledging that—
(A) The loan that has been conditionally discharged prior to a final determination of total and permanent disability cannot be discharged in the future on the basis of any impairment present when the borrower applied for a total and permanent disability discharge or when the new loan is made unless that impairment substantially deteriorates; and
(B) Collection activity will resume on any loans in a conditional discharge period, as described in paragraph 682.402(c)(16).
The additions and revisions read as follows:
(b) * * *
(2) A discharge of a loan based on the death of the borrower (or student in the case of a PLUS loan) must be based on an original or certified copy of the death certificate. Under exceptional circumstances and on a case-by-case basis, the chief executive officer of the guaranty agency may approve a discharge based upon other reliable documentation supporting the discharge request.
(3) After receiving reliable information indicating that the borrower (or student) has died, the lender must suspend any collection activity against the borrower and any endorser for up to 60 days and promptly request the documentation described in paragraph (b)(2) of this section. If additional time is required to obtain the documentation, the period of suspension of collection activity may be extended up to an additional 60 days. If the lender is not able to obtain an original or certified copy of the death certificate or other documentation acceptable to the guaranty agency, under the provisions of paragraph (b)(2) of this section, during the period of suspension, the lender must resume collection activity from the point that it had been discontinued. The lender is deemed to have exercised forbearance as to repayment of the loan during the period when collection activity was suspended.
(c) * * *
(1)(i) If the Secretary has made an initial determination that the borrower is totally and permanently disabled, as defined in § 682.200(b), the loan is conditionally discharged for up to three years from the date that the borrower became totally and permanently disabled, as certified by a physician. The Secretary suspends collection activity on the loan from the date of the initial determination of total and permanent disability until the end of the conditional period. If the borrower satisfies the criteria for a total and permanent disability discharge during and at the end of the conditional discharge period, the balance of the loan is discharged at the end of the conditional discharge period and any payments received after the date the borrower became totally and permanently disabled as certified under § 682.402(c)(2), are returned to the sender.
(ii) A borrower satisfies the criteria for a discharge of a loan based on a total and permanent disability if, during and at the end of the three-year period described in paragraph (c)(1)(i) of this section—
(A) The borrower's annual earnings from employment do not exceed 100 percent of the poverty line for a family of two, as determined in accordance with the Community Service Block Grant Act; and
(B) The borrower does not receive a new loan under the Perkins, FFEL, or Direct Loan programs, except for a FFEL or Direct Consolidation loan that does not include any loans that are in a conditional discharge status.
(iii) Except as provided in paragraph (c)(1)(iv)(A) of this section, a borrower is not considered totally and permanently disabled based on a condition that existed at the time the loan was made unless the borrower's condition substantially deteriorated.
(2) After being notified by the borrower or the borrower's representative that the borrower claims to be totally and permanently disabled, the lender promptly requests that the borrower or the borrower's representative submit, on a form approved by the Secretary, a certification by a physician, who is a doctor of medicine or osteopathy and legally authorized to practice in a State, that the borrower is totally and permanently disabled as defined in § 682.200(b).
(3) The lender must continue collection activities until it receives either the certification of total and permanent disability from a physician or a letter from a physician stating that the certification has been requested and that additional time is needed to determine if the borrower is totally and permanently disabled. Except as provided in paragraph (c)(5) or (c)(7) of this section, after receiving the physician's certification or letter the lender may not attempt to collect from the borrower or any endorser.
(4) The lender must submit a disability claim to the guaranty agency if the borrower submits a certification by a physician and the lender makes a determination that the certification supports the conclusion that the borrower meets the criteria for a total and permanent disability discharge, as defined in § 682.200(b).
(5) If the lender determines that a borrower who claims to be totally and permanently disabled is not totally and permanently disabled, or if the lender does not receive the physician's certification of total and permanent disability within 60 days of the receipt of the physician's letter requesting additional time, as described in paragraph (c)(3) of this section, the lender must resume collection and is deemed to have exercised forbearance of payment of both principal and interest from the date collection activity was suspended. The lender may capitalize, in accordance with § 682.202(b), any interest accrued and not paid during that period.
(6) The guaranty agency must pay a claim submitted by the lender if the guaranty agency has reviewed the application and determined that it is complete and that it supports the conclusion that the borrower meets the criteria for a total and permanent disability discharge, as defined in § 682.200(b).
(7) If the guaranty agency does not pay the disability claim, the guaranty agency must return the claim to the lender with an explanation of the basis for the agency's denial of the claim. Upon receipt of the returned claim, the lender must notify the borrower that the application for a disability discharge has been denied, provide the basis for the denial, and inform the borrower that the lender will resume collection on the loan. The lender is deemed to have exercised forbearance of both principal and interest from the date collection activity was suspended until the first payment due date. The lender may capitalize, in accordance with § 682.202(b), any interest accrued and not paid during that period.
(8) If the guaranty agency pays the disability claim, the lender must notify the borrower that the loan will be assigned to the Secretary for determination of eligibility for a total and permanent disability discharge.
(9) After receiving a claim payment from the guaranty agency, the lender must forward to the guaranty agency any payments subsequently received from or on behalf of the borrower.
(10) The Secretary reimburses the guaranty agency for a disability claim paid to the lender after the agency pays the claim to the lender.
(11) The guaranty agency must assign the loan to the Secretary after the guaranty agency pays the disability claim.
(12) If the Secretary determines that the certification and information provided by the borrower do not support the conclusion that the borrower meets the criteria for a total and permanent disability discharge, the Secretary notifies the borrower that the application for a disability discharge has been denied, and that the loan is due and payable under the terms of the promissory note.
(13) If the Secretary makes an initial determination that the borrower is totally and permanently disabled, the Secretary notifies the borrower that the loan is conditionally discharged and that the conditional discharge period will last for up to three years after the date the borrower became totally and permanently disabled as certified under § 682.402(c)(2). The notification identifies the conditions of the conditional discharge period specified in paragraphs (c)(13) through (c)(16) of this section and specifies that all or part of the three-year period may predate the Secretary's initial determination.
(14) During the conditional discharge period, the borrower—
(i) Is not required to make any payments on the loan;
(ii) Is not considered delinquent or in default on the loan, unless the borrower was delinquent or in default at the time the conditional discharge was granted;
(iii) Must promptly notify the Secretary of any changes in address or phone number;
(iv) Must promptly notify the Secretary if the borrower's annual earnings from employment exceed the amount specified in paragraph (c)(1)(ii)(A) of this section; and
(v) Must provide the Secretary, upon request, with additional documentation or information related to the borrower's eligibility for discharge under this section.
(15) If, during and at the end of the conditional discharge period, the borrower continues to satisfy the eligibility criteria for a total and permanent disability discharge, as described in § 682.402(c)(1)(ii), the balance of the loan is discharged.
(16) If, at any time during the three-year conditional discharge period, the borrower does not continue to meet the eligibility requirements for a total and permanent disability discharge, the Secretary resumes collection activity on the loan. The Secretary does not require the borrower to pay any interest that accrued on the loan from the date of the initial determination described in paragraph (c)(13) of this section through the end of the conditional discharge period.
(g) * * *
(1) * * *
(iii) In the case of a death claim, an original or certified death certificate, or other documentation supporting the discharge request that formed the basis for the determination of death.
(k) * * *
(5) * * *
(i) For death or bankruptcy claims, the shorter of 60 days or the period from the date the guaranty agency determines that the borrower (or the student for whom a parent obtained a PLUS loan, or each of the co-makers of a PLUS loan) dies, or filed a petition for relief in bankruptcy until the Secretary authorizes payment;
(ii) For disability claims, the shorter of 60 days or the period from the date the guaranty agency makes a preliminary determination that the borrower became totally and permanently disabled until the Secretary authorizes payment; or
(r)(1) If the guaranty agency receives any payments from or on behalf of the borrower on or attributable to a loan that as been discharged in bankruptcy on which the Secretary previously paid a bankruptcy claim, the guaranty agency must return 100 percent of these payments to the sender. The guaranty agency must promptly return, to the sender, any payment on a cancelled or discharged loan made by the sender and received after the Secretary pays a closed school or false certification claim. At the same time that the agency returns the payment, it must notify the borrower that there is no obligation to repay a loan discharged on the basis of death, bankruptcy, false certification, or closing of the school.
(2) If the guaranty agency receives any payments from or on behalf of the borrower on or attributable to a loan that has been assigned to the Secretary for determination of eligibility for a total and permanent disability discharge, the guaranty agency must forward those payments to the Secretary for crediting to the borrower's account. At the same time that the agency forwards the payments, it must notify the borrower that there is no obligation to make payments on the loan while it is conditionally discharged prior to a final determination of eligibility for a total and permanent disability discharge, unless the Secretary directs the borrower otherwise.
(3) When the Secretary makes a final determination to discharge the loan, the Secretary returns to the sender any payments received on the loan after the date the borrower became totally and permanently disabled.
(5) If the guaranty agency has returned a payment to the borrower, or the borrower's representative, with the notice described in paragraphs (r)(1) or (r)(2) of this section, and the borrower (or representative) continues to send payments to the guaranty agency, the agency must remit all of those payments to the Secretary.
20 U.S.C. 1087a
The revised and added text reads as follows:
(a)(1) * * *
(iv)(A) In the case of a borrower whose prior loan under title IV of the Act was discharged after a final determination of total and permanent disability, the borrower—
(
(
(B) In the case of a borrower whose prior loan under title IV of the Act was discharged on or after July 1, 2001 and before July 1, 2002 after a final determination of total and permanent disability, the borrower—
(
(
(C) In the case of a borrower whose prior loan under title IV of the Act was conditionally discharged based on an initial determination that the borrower was totally and permanently disabled—
(
(
(
(
The additions and revisions read as follows:
(a)
(2) If an original or certified copy of the death certificate is not available, the Secretary discharges the loan only based on other reliable documentation that establishes, to the Secretary's satisfaction, that the borrower (or student) has died. The Secretary discharges a loan based on documentation other than an original or certified copy of the death certificate only under exceptional circumstances and on a case-by-case basis.
(b)
(g) * * *
(1)
(2)
(a)
(i) Notifies the borrower that the loan will be in a conditional discharge status for up to three years from the date that the borrower became totally and permanently disabled, as certified under 685.213(b). The Secretary also notifies the borrower of the conditions of the conditional discharge period, and that all or part of the three-year conditional discharge period may predate the Secretary's initial determination.
(ii) Suspends any efforts to collect on the loan from the date of the initial determination described in paragraph (a)(1) of this section until the end of the conditional discharge period.
(2) If the borrower continues to meet the eligibility requirements for total and permanent disability discharge during and at the end of the three-year conditional discharge period, the Secretary—
(i) Discharges the obligation of the borrower and any endorser to make any further payments on the loan at the end of that period; and
(ii) Returns to the borrower any payments received after the date the borrower became totally and permanently disabled, as certified under § 685.213(b).
(3) If the borrower does not continue to meet the eligibility requirements for a total and permanent disability discharge at any time during or at the end of the three-year conditional discharge period, the Secretary resumes collection activity on the loan. The Secretary does not require the borrower to pay any interest that accrued on the loan from the date of the initial determination described in paragraph (a)(1) of this section through the end of the conditional discharge period.
(4) Except as provided in paragraph (e)(1) of this section, a borrower is not considered totally and permanently disabled based on a condition that existed at the time the loan was made, unless the borrower's condition substantially deteriorated after the loan was made so as to render the borrower totally and permanently disabled.
(b)
(c)
(1) The borrower's annual earnings from employment do not exceed 100 percent of the poverty line for a family of two, as determined in accordance with the Community Service Block Grant Act; and (2) The borrower does not receive a new loan under the Perkins, FFEL, or Direct Loan programs, except for a FFEL or Direct consolidation loan that does not include any loans that are in a conditional discharge status.
(d)
(1) Is not required to make any payments of principal or interest on the loan beginning on the date the Secretary makes an initial determination that the borrower is totally and permanently disabled;
(2) Is not considered to be delinquent or in default on the loan, unless the loan was delinquent or in default at the time the conditional discharge was granted;
(3) Must promptly notify the Secretary of any changes in the borrower's address or telephone number;
(4) Must promptly notify the Secretary if the borrower's annual earnings from employment exceed the amount specified in paragraph (c)(1) of this section; and
(5) Must provide the Secretary, upon request, with additional documentation or information related to the borrower's eligibility for discharge under this section.
(e)
(2) For the purposes of discharging a loan under paragraph (e)(1) of this section, the provisions of this section apply to each loan included in the Direct Consolidation Loan, even if the loan is not a Direct Loan Program loan.
(3) If requested, a borrower seeking to discharge a loan obligation under paragraph (e)(1) of this section must provide the Secretary with the disbursement dates of the underlying loans.
Department of Defense (DoD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA).
Proposed rule.
The Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council (Councils) are proposing to amend the Federal Acquisition Regulation (FAR) to clarify and encourage the use of electronic signatures in Federal procurement.
Interested parties should submit comments in writing on or before January 2, 2001 to be considered in the formulation of a final rule.
Submit written comments to: General Services Administration, FAR Secretariat (MVRS), 1800 F Street, NW, Room 4035, ATTN: Laurie Duarte, Washington, DC 20405.
Submit electronic comments via the Internet to: farcase.2000-304@gsa.gov.
Please submit comments only and cite FAR case 2000-304 in all correspondence related to this case.
The FAR Secretariat, Room 4035, GS Building, Washington, DC 20405, at (202) 501-4755 for information pertaining to status or publication schedules. For clarification of content, contact Ralph De Stefano, Procurement Analyst, at (202) 501-1758. Please cite FAR case 2000-304.
On October 21, 1998, the Government Paperwork Elimination Act (Title XVII of Division C of Public Law 105-277) was enacted. On June 30, 2000, the Electronic Signatures in Global and National Commerce Act (Pub. L. 106-229) was enacted. These laws eliminate legal barriers to using electronic technology in business transactions, such as the formation and signing of contracts.
The proposed rule furthers Government participation in electronic commerce when conducting Federal procurements by—
1. Revising the definitions of “in writing” and “signature” at FAR 2.101 to clarify that these terms include electronic, in addition to paper, transactions; and
2. Adding a policy statement at FAR Subpart 4.5, Electronic Commerce in Contracting, to encourage agencies to use electronic commerce, such as electronic signature, in the transaction of Federal procurements.
This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of Executive Order 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.
The Councils do not expect this proposed rule to have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601,
The Paperwork Reduction Act does not apply because the proposed changes to the FAR do not impose information collection requirements that require the approval of the Office of Management and Budget under 44 U.S.C. 3501,
Government procurement.
Therefore, DoD, GSA, and NASA propose that 48 CFR parts 2 and 4 be amended as set forth below:
1. The authority citation for 48 CFR parts 2 and 4 continues to read as follows:
40 U.S.C. 486(c); 10 U.S.C. chapter 137; and 42 U.S.C. 2473(c).
2. Amend section 2.101 by revising the definitions “Electronic commerce”, “In writing”, and “Signature” to read as follows:
3. Amend section 4.502 by adding paragraph (d) to read as follows:
(d) As required by the Government Paperwork Elimination Act (GPEA) (Title XVII of Division C of Public Law 105-277), by October 21, 2003, agencies must allow individuals or entities the option to submit information or transact with the agency electronically when practicable. The GPEA requirement includes execution of contracts and associated records using electronic signatures of the offeror or contractor and the agency.
Bureau of the Public Debt, Fiscal Service, Treasury.
Final rule.
We rewrote Regulations Governing Fiscal Agency Checks and Regulations Governing Book-Entry Conversion of Detached Bearer Coupons and Bearer Corpora, in plain language. We also made two changes in the regulations. We removed references to the Federal Reserve Bank of New York as the processor for bearer corpora and coupons, and we eliminated the fees requirement for conversions.
Effective November 1, 2000.
You can download this final rule at the following World Wide Web address: <http://www.publicdebt.treas.gov>.
Executive Order 12866 and the President's memorandum of June 1, 1998 (63 FR 31885) require each agency to write all rules in plain language. We have rewritten 31 CFR part 355, Regulations Governing Fiscal Agency Checks, and 31 CFR part 358, Regulations Governing Book-Entry Conversion of Detached Bearer Coupons and Bearer Corpora, in plain language.
No substantive changes were made to part 355 which was originally published as an interim regulation in 1985. This final rule will adopt part 355 in a final form.
Part 358 has been changed to remove references to the Federal Reserve Bank of New York as the agent for the conversion to book-entry of bearer corpora and detached bearer coupons because the Bureau of the Public Debt will process the conversions at its Parkersburg, WV location.
Fees for conversions of corpora and coupons have been eliminated. The collection of fees is not cost-effective and is counter-productive to our goal of eliminating paper securities.
This final rule does not meet the criteria for a “significant regulatory action,” as defined in Executive Order 12866. Therefore, the regulatory review procedures contained therein do not apply.
This final rule relates to matters of public contract and procedures for United States securities. The notice and public procedures requirements and delayed effective date requirements of the Administrative Procedure Act are inapplicable, pursuant to 5 U.S.C. 553(a)(2).
As no notice of proposed rulemaking is required, the Regulatory Flexibility Act (5 U.S.C. 601,
We ask for no new collections of information in this final rule. Therefore, the Paperwork Reduction Act (44 U.S.C. 3507) does not apply.
Federal Reserve System, Government securities.
12 U.S.C. 391; 31 U.S.C. Ch. 31.
This part governs checks issued for payments in connection with United States securities. These checks, referred to as “fiscal agency checks,” are issued by a designated Federal Reserve Bank in its capacity as fiscal agent of the United States. The checks are drawn on the payor Federal Reserve Bank in its banking capacity. The drawer of a fiscal agency check is the United States, and the drawee is a Federal Reserve Bank. The rights and liabilities of the United States, the Federal Reserve Banks, and others are set out in this part.
The regulations governing checks drawn on the United States and on designated depositories of the United States do not apply to fiscal agency checks, unless a statute specifically provides differently, or unless we state differently in this part. If a definition or matter pertaining to fiscal agency checks is not specifically covered in this part, we will apply the provisions of Regulations J of the Board of Governors of the Federal Reserve System, at 12 CFR part 210. To the extent not otherwise covered by this part or by Regulation J, we will apply the provisions of the Uniform Commercial Code (U.C.C.)
(1) Any insured bank, mutual savings bank or savings bank as defined in 12 U.S.C. 1813, or any institution eligible to become an insured bank under 12 U.S.C. 1815;
(2) Any insured credit union as defined in 12 U.S.C. 1752, or any credit union eligible to become an insured credit union under 12 U.S.C. 1781;
(3) Any member as defined in 12 U.S.C. 1422; and
(4) Any savings association as defined in 12 U.S.C. that is an insured depository institution as defined in the Federal Deposit Insurance Act, 12 U.S.C. 1811
Presentment of a fiscal agency check must be made to the payor Reserve Bank. The payor Reserve Bank will only cash a fiscal agency check presented by the payee who can be identified to the satisfaction of the Reserve Bank. Otherwise, a fiscal agency check must be presented through banking channels. A refusal to accept or to pay fiscal agency check presented by a person other than the payee, or by a payee who is not reasonably identified, does not constitute dishonor.
A payor Reserve Bank may refuse to pay a fiscal agency check presented more than six (6) months after the issue date of the check. If the check is not presented within this time, you must follow the procedures in § 355.10.
(a) A presenting bank makes the warranties required of a sender under Subpart A of Regulation J (12 CFR part 210). This paragraph does not limit any warranty by a presenter or other party arising under State law.
(b) We are not barred from recovering on a breach of warranty solely because:
(1) Our negligence contributed to a fraudulent endorsement or material alteration;
(2) We did not promptly discover an unauthorized signature or alteration;
(3) An impostor fraudulently caused the issuance of a fiscal agency check in the name of any existing payee; or
(4) Our employee fraudulently caused the issuance of a fiscal agency check in the name of any existing payee.
If the presenting bank breaches its warranty, the payor Reserve Bank may either return the check to the presenting bank or send notice of the breach to the presenting bank. If the presenting bank does not make prompt restitution when it receives the returned check or notice of breach, we may begin appropriate collection procedures.
If a fiscal agency check is not received within a reasonable time after a payment is due, or if a check is lost, stolen, or destroyed, you must provide prompt written notification. Your written notice may be sent to us or to the payor Reserve Bank. You may give notice by telephone, but we will not issue a replacement check until you confirm the notice in writing. The written notice must provide enough information for us to identify the account and the security to which the payment relates. We will stop payment on the fiscal agency check if we have a reasonable time to act before final payment.
The payor Federal Reserve Bank will issue a replacement fiscal agency check if:
(a) You submit written notice:
(b) The check is unpaid;
(c) We determine that recovery of the original check is unlikely; and
(d) The payee and endorsee, if any, of the check execute the required indemnification agreement.
If you recover the original check you must notify us in writing. If we have not yet issued a replacement check, we will remove the stop payment order against the original check. If we have already issued a replacement check, you must return the original check to us.
If the payor Reserve Bank refuses payment on a fiscal agency check solely because it is presented more than six (6) months after the issue date of the check, a replacement check will be issued if you:
(a) Surrender the original check; and
(b) Executive the required indemnification agreement.
If we verify the existence or a forged or unauthorized endorsement on a paid fiscal agency check, the payor Reserve Bank will issue a replacement check to the person entitled. The payee or endorsee must execute an affidavit that there has been a forged or unauthorized endorsement. We may also require an indemnification agreement.
If the fiscal agency check is payable to two or more persons, the requirements of this part apply to all designated payees.
We may require an indemnification agreement, with or without surety. You must provide any additional evidence we consider necessary. We will require any information necessary for the protection of the interests of the United States.
We reserve the right, in our discretion, to waive any provision of the regulations in this part in any case or class of cases for the convenience of the United States, or to relieve any person of unnecessary hardship, if the waiver is not inconsistent with law and will not subject the United States to substantial expense or liability.
We may, at any time, supplement, amend, or revise the regulations in this part.
12 U.S.C. 391, 31 U.S.C. Ch. 31.
(a) This part applies to the conversion to book-entry of United States Treasury bearer corpora and detached bearer coupons.
(b) These instruments are accepted from depository institutions for conversion under the Bearer Corpora Conversion System (BECCS) and Coupons Under Book Entry Safekeeping (CUBES) programs.
(1) For coupons converted after November 1, 2000, these regulations supersede the terms and conditions governing CUBES set forth in the written “Agreements to the Terms and Conditions Governing CUBES” signed by depository institutions that previously participated in the CUBES program.
(2) Depository institutions that submit bearer corpora and detached bearer coupons are deemed to agree to the terms and conditions in this part and any other requirements we may prescribe.
(1) Any insured bank, mutual savings bank, or savings bank as defined in 12 U.S.C. 1813, or any institution eligible to become an insured bank under 12 U.S.C. 1815;
(2) Any insured credit union as defined in 12 U.S.C. 1752, or any credit union eligible to become an insured credit union under 12 U.S.C. 1781;
(3) Any member as defined in 12 U.S.C. 1422; and
(4) Any savings association as defined in 12 U.S.C. that is an insured depository institution as defined in the Federal Deposit Insurance Act, 12 U.S.C. 1811
BECCS and CUBES securities are deemed to be securities for the purposes of 31 CFR part 357, subparts A, B, and D, and are governed by that part. Notwithstanding the provisions of 31 CFR part 357, certain BECCS and CUBES securities are non-transferable. See § 358.5.
Bearer corpora and detached bearer coupons will not be accepted if they are submitted:
(a) Within 30 days of their maturity date; or
(b) If the call provision has been invoked, within 30 days of their call date.
(a) For a callable corpus to be eligible for conversion to a transferable BECCS security, all associated callable coupons must be submitted with the corpus. These callable coupons will be linked with the corpus within BECCS when converted. Once the coupons are linked to the corpus, they may not be transferred separately.
(b) A corpus that is not subject to call will be converted to a transferable BECCS security.
(c) Non-callable coupons will be converted to transferable CUBES securities.
If all of the callable coupons associated with the corpus are not submitted with the corpus, the corpus will be converted to a non-transferable BECCS security. Any remaining callable coupons submitted with the corpus will be converted to individual non-transferable CUBES securities.
Bearer corpora and detached bearer coupons must be submitted in accordance with our procedures. They must be accompanied by an approved form executed by an authorized officer of the submitting depository institution. Until we verify the submission, the bearer corpora and detached bearer coupons are subject to rejection or adjustment.
Send bearer corpora and detached bearer coupons to be converted to: Bureau of the Public Debt, Division of Customer Service, P. O. Box 426, Parkersburg, WV 26106-0426.
We do not charge fees for the conversion of bearer corpora or detached bearer coupons to BECCS or CUBES securities.
The following guidelines apply to the transportation of bearer corpora and detached bearer coupons:
(a) Shipment from the depository institution is at the risk and expense of the depository institution;
(b) Shipment between our designated agent and the Department, if required, is at our risk and expense; and
(c) Shipment of securities that are returned to the depository institution is at the risk and expense of the depository institution.
Only full dollar amounts can be held in CUBES; principal amounts that include cents cannot be held in CUBES. Upon the conversion of coupons to CUBES, amounts of less than one dollar in aggregate per CUBES CUSIP will not be credited to the account of the depository institution.
A depository institution submits five coupons with face amount of $346.88 each, and a total dollar amount of $1,734.40. Upon conversion of these coupons to CUBES, only $1,734.00 will be credited to the depository institution's account.
By submitting bearer corpora and detached bearer coupons for conversion to BECCS and CUBES securities, a depository institution represents that it has the authority to request the conversion.
We are not liable if the depository institution has no authority to convert the bearer corpora and detached bearer coupons to book-entry form or to take other actions in respect to book-entry accounts in BECCS and CUBES.
We are not liable for any loss incurred by the depository institution as a result of its failure to properly follow our procedures.
(a) After processing and initial verification, we will transfer the securities accepted to the depository institution's book-entry account, establishing a securities entitlement in TRADES according to 31 CFR part 357 subpart B.
(b) We will do the final verification within twenty (20) business days of initial receipt of the bearer corpora and detached bearer coupons.
(c) If at any time after this twenty (20) day period we determine that the security was improperly credited to the BECCS or CUBES account of the depository institution, such as in the case of a previously undetected, counterfeit security, we reserve the right to adjust the BECCS or CUBES account.
(a) If we make an adjustment to all or part of the submitted securities, we will instruct the depository institution to transfer BECCS or CUBES securities of the same payment date and face amount from the depository institution's account to an account that we designate.
(b) If no such BECCS or CUBES securities exist in the depository institution's account, we will instruct the depository institution as to how the adjustment will be made.
(c) If the depository institution fails to comply with our instructions within five (5) business days of receipt of the instructions, we reserve the right to debit the master account of the depository institution for the face value of the adjusted bearer corpora and detached bearer coupons. By the submission of the bearer corpora and detached bearer coupons, the depository institution is deemed to agree to this debit.
BECCS and CUBES accounts are maintained separately from accounts maintained in Treasury's STRIPS (Separate Trading of Registered Interest and Principal of Securities) program.
After bearer corpora and detached bearer coupons have been converted to book-entry form, reconversion to physical form is prohibited. The reconstitution of a BECCS security with CUBES securities or any combination of Treasury obligations is prohibited.
(a) Except as otherwise provided by regulation, circular, or written agreement, any fiscal agent designated to act on our behalf is liable for its action or omission only if it failed to exercise ordinary care.
(b) We do not assume any responsibility to any party except the sending and receiving depository institutions involved in a BECCS or CUBES transaction.
(c) We do not assume any responsibility in connection with a BECCS or CUBES transaction for the insolvency, neglect, misconduct, mistake, or default of another bank or person, including the immediate participants.
The submitting depository institution shall indemnify the United States against any loss resulting from the conversion of a bearer corpus that is missing one or more associated callable coupons.
We reserve the right to waive or modify any provision of the regulations in this part for the convenience of the United States or to relieve any person of unnecessary hardship, if such action is not inconsistent with law, does not impair existing rights, and does not subject the United States to any substantial expense or liability.
We may at any time supplement, amend, or revise the regulations in this part.