[Federal Register Volume 66, Number 243 (Tuesday, December 18, 2001)]
[Proposed Rules]
[Pages 65165-65173]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-30998]


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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Part 573

[Docket No. NHTSA-2001-10856]
RIN 2127-AI29


Motor Vehicle Safety; Disposition of Recalled Tires

AGENCY: National Highway Traffic Safety Administration (NHTSA), DOT.

ACTION: Notice of proposed rulemaking.

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SUMMARY: This proposes a rule implementing section 7 of the 
Transportation Recall Enhancement, Accountability, and Documentation 
(TREAD) Act. Section 7 provides that a manufacturer's remedy program 
for the replacement of defective or noncompliant tires shall include a 
plan addressing how to prevent, to the extent reasonably within the 
manufacturer's control, the replaced tires from being resold for 
installation on a motor vehicle, and also how to limit, to the extent 
reasonably within the manufacturer's control, the disposal of replaced 
tires in landfills. Section 7 also requires the manufacturer to include 
information about the implementation of the plan in quarterly reports 
to the Secretary about the progress of any notification and remedy 
campaigns.

DATES: Comments: You should submit your comments early enough to ensure 
that Docket Management receives them not later than February 19, 2002.

ADDRESSES: You should mention the docket number of this document in 
your comments, and submit your comments in writing to Docket 
Management, Room PL-401, 400 Seventh Street, SW, Washington, DC 20590. 
You may also submit your comments electronically by logging onto the 
Dockets Management System website at http://dms.dot.gov. Click on 
``Help & Information'' or ``Help/info'' to obtain instructions for 
filing the document electronically.
    Regardless of how you submit your comments, you should mention the 
docket number of this document in your comments.
    You may call Docket Management at 202-366-9324. You may visit 
Docket Management from 10 a.m. to 5 p.m., Monday through Friday.

FOR FURTHER INFORMATION CONTACT: For non-legal issues, contact Jonathan 
White, Office of Defects Investigation, tel. (202) 366-5226. For legal 
issues, contact Enid Rubenstein, Office of Chief Counsel, tel. (202) 
366-5263.

SUPPLEMENTARY INFORMATION:

I. Background

    On November 1, 2000, the TREAD Act, Pub. L. 106-414, was enacted. 
The statute was, in part, a response to congressional concerns related 
to the tire recall being conducted by Bridgestone/Firestone, Inc. 
(``Firestone'') during the summer and fall of 2000 with respect to 
safety-related defects in about 6.5 million Firestone ATX and ATX II 
size P235/75R15 tires (manufactured at all U.S. Firestone plants) and 
Firestone Wilderness AT tires of that size manufactured at Firestone's 
Decatur, Illinois plant.
    Under 49 U.S.C. 30118(b), NHTSA may make a final decision that a 
motor vehicle or replacement equipment (including a tire) contains a 
defect related to motor vehicle safety or does

[[Page 65166]]

not comply with an applicable Federal motor vehicle safety standard. In 
addition, under 49 U.S.C. 30118(c), a manufacturer of a motor vehicle 
or replacement equipment (including a tire) is required to notify NHTSA 
if the manufacturer decides that the vehicle or equipment contains a 
defect that is related to motor vehicle safety or does not comply with 
an applicable Federal motor vehicle safety standard. In either 
instance, in the case of tires, the manufacturer of the defective or 
noncompliant tires (including original equipment tires that are 
installed on or sold with new motor vehicles, as well as replacement 
tires) is required under 49 U.S.C. 30119 to notify tire owners of the 
defect or noncompliance and is required under 49 U.S.C. 30120(b) to 
repair or replace the defective or noncompliant tires within 60 days of 
the notification to owners about the recall or about the availability 
of replacement tires. (This 60-day period may be extended if 
replacement tires are not available promptly.)
    Also, pre-TREAD Act law, 49 U.S.C. 30120(d), required the 
manufacturer to file with the Secretary a copy of the manufacturer's 
program for remedying a defect or noncompliance. But section 30120(d) 
did not require the manufacturer's program to include a plan for the 
disposition or disposal of recalled tires that were returned by the 
tire owners or purchasers.
    Section 7 of the TREAD Act expanded 49 U.S.C. 30120(d) to require a 
manufacturer's remedy program for tires to include a plan for 
preventing, to the extent reasonably within the manufacturer's control, 
the resale of replaced tires for use on motor vehicles, as well as a 
plan for the disposition of replaced tires, particularly through 
methods such as shredding, crumbling, recycling, recovery, or other 
``beneficial non-vehicular uses,'' rather than in landfills. Further, 
section 7 requires the manufacturer to include information about the 
implementation of its plan in quarterly reports that it is required to 
make to the Secretary about the progress of its notification and remedy 
campaigns.
    The TREAD Act authorizes the Secretary of Transportation (``the 
Secretary'') to issue various rules relating to a manufacturer's 
notification and remedy program, to carry out Chapter 301 of Title 49 
of the United States Code, which is commonly referred to as the Safety 
Act. This rulemaking authority has been delegated to NHTSA's 
Administrator in 49 CFR 1.50.
    In order to implement section 7's new requirements concerning 
manufacturers' plans to preclude resale and for disposition of replaced 
tires, we are proposing to amend 49 CFR 573.5 and 573.6. Below are a 
summary and explanation of the provisions of today's proposed rule.

II. Discussion

A. Introduction and Background

1. Reason for TREAD Requirements
a. Need To Prevent Resale of Recalled Tires
    The provision in section 7 of the TREAD Act that requires 
manufacturers to provide plans to prevent the resale of recalled tires 
for use on motor vehicles supplements the pre-TREAD Act ban on the sale 
of new defective or noncompliant motor vehicles or motor vehicle 
equipment, unless and until (if possible) they have been remedied. 49 
U.S.C. 30120(i). It also supplements section 8 of the TREAD Act, which 
prohibits the sale or lease of any (new or used) defective or 
noncompliant motor vehicle equipment (including a tire) for 
installation on a motor vehicle, unless and until (if possible) the 
defect or noncompliance has been remedied. 49 U.S.C. 30120(j). Finally, 
it is also related to section 3(c) of the TREAD Act, which requires any 
person who (1) knowingly and willfully sells or leases for use on a 
motor vehicle a defective tire or a tire not in compliance with 
applicable safety standards and (2) has actual knowledge that the 
manufacturer of such tire has notified its dealers of such defect or 
noncompliance, to report that sale or lease to NHTSA. 49 U.S.C. 
30166(n). NHTSA has already issued regulations implementing section 
30166(n); see 49 CFR 573.10.
    Most tires that are recalled are unrepairable, and therefore most 
are replaced rather than repaired. Section 7 of TREAD recognizes the 
reality that tire recalls may result in the creation of stockpiles of 
dangerous, unremedied tires and requires manufacturers to develop plans 
to deal with them.
a. Problems Posed by Scrap Tires
    Today's proposed rule would require manufacturers to develop plans 
addressing how they will prevent, to the extent reasonably within the 
manufacturers' control, recalled tires from being resold for use on 
motor vehicles, and that limit the disposal of recalled tires in 
landfills and provide instead, to the extent reasonably within the 
manufacturers' control, for disposition by other means, such as 
shredding, crumbling, recycling, and recovery. The proposed rule also 
would require manufacturers to include information about implementation 
of their plans in the quarterly reports that the manufacturers must 
file with us under our reporting regulations,49 CFR 573.6.
    Defective tires pose a substantial risk to motor vehicle safety. 
The Firestone tires that have been recalled have been associated with 
numerous deaths. The recall included both new tires in stock and used 
tires. Many of the remaining tires had considerable remaining tread and 
could have been reused if they had not been physically altered to 
preclude their use on a motor vehicle.
    The management and disposition of tires is an ongoing environmental 
concern that can be aggravated by a safety recall. More than 270 
million tires are scrapped annually in the United States. Although the 
6.5 million tires involved in last year's Firestone recall would in the 
aggregate amount to a substantial volume of tires, the recall has been 
characterized as representing ``just a drop in the bucket'' compared to 
the numbers of tires disposed of annually. See ``Recalled Tires Just a 
Drop in the Industry Bucket,'' Recycling Today, News (October 2000), 
http://recyclbroker.com/info-tires.htm. A copy of this article has been 
placed in the docket for this rulemaking.
    In addition to being unsightly and large, stockpiled ``scrap'' 
tires may present serious health and environmental risks. Tire piles 
can collect gas, and they provide breeding grounds for rodents and 
mosquitoes. Whole tires tend to rise in a landfill and come to the 
surface, which may compromise a landfill cover, and allow water to 
enter a landfill which would generate leachate. Tire piles also are 
susceptible to fire from arson, lightning, and even spontaneous 
combustion. Tire pile fires pollute the air and are difficult to 
extinguish. Water used to extinguish them becomes polluted with toxic 
substances and may pollute watercourses.
2. State Regulation of Management and Disposal of Scrap Tires
    Because of the environmental risks posed by scrap tires, many 
states ban the disposal of whole scrap tires in landfills, and 49 of 
the 50 states have some form of regulations that cover scrap tire 
management, including in some instances charges for tire disposal and 
financial incentives for using scrap tires in other products. These 
state laws and regulations are summarized briefly in a booklet 
published by the U.S. Environmental Protection Agency (``EPA''), State 
Scrap Tire Programs: A Quick Reference Guide: 1999 Update (EPA-530-99-
002) (August 1999). This

[[Page 65167]]

booklet presents a matrix that summarizes each state's scrap tire 
programs and regulations, provides information about how to contact 
state scrap tire program managers, and describes grants and other 
programs that are intended to improve scrap tire disposal and recycling 
and reduction. A copy of this booklet has been placed in the docket for 
this rulemaking action; it is also available at EPA's website: (http://www.epa.gov) . This is included in the docket as illustrative 
background material and not as an official statement or interpretation 
of applicable legal requirements.
3. Possible Uses for Scrap Tires
    Today's steel-belted radial tires are not biodegradable and are 
difficult to dispose of or recycle, because they are made of a mixture 
of fabric, steel, carbon black, and several types of natural and 
synthetic rubbers. According to the U.S. Department of Energy 
(``DOE''), estimates of the number of ``scrap'' tires in stockpiles 
around the United States range from 500 million to three billion. See 
DOE, Consumer Energy Information: EEC Reference Briefs, http://www.eren.doe.gov/consumerinfo/refbriefs/ee9/html, which has been placed 
in the docket for this rulemaking action). Additional environmental 
information relevant to the subject of this rulemaking is available on 
the Scrap Tire Management Council Website and on the Website of Scrap 
Tire News (http://www.scraptirenews.com/archive.html), published by the 
Recycling Research Institute of Suffield. CT.
    The need to develop uses for ``scrap'' tires has been recognized 
for many years, by government agencies and by the tire industry, which 
has established a Scrap Tire Management Council, a nonprofit 
organization that is devoted to expanding the market for scrap tires. 
(The council's Website address is http://www.rma.org/scraptires/scraptires.html). Section 7 of the TREAD Act recognizes this same need.
    Another EPA booklet, Summary of Markets for Scrap Tires (EPA/530-
SW-90-0748 (October 1991)) (``EPA Market Summary''), describes 
potential market uses for scrap tires. These uses include the 
manufacture of crumb rubber, which may be incorporated into asphalt 
pavement, into rubber products such as floor mats, vehicle mud guards 
and carpet padding, and into plastic products such as floor mats and 
adhesives, or processed further into reclaimed rubber, which is made by 
mixing crumb rubber with water, oil and chemicals and heating the 
mixture under pressure. Crumb rubber also can be used in railroad 
crossings. Shredded tires can be used as bulking agents in the 
composting of wastewater treatment sludge. Chipped tires can be used 
for playground gravel substitutes and lightweight road fill material. 
Whole or partial scrap tires also can be used for artificial reefs, 
breakwaters, erosion control, playground equipment, commercial fishing 
equipment, and highway crash barriers. See ``EPA Market Summary,'' pp. 
8-9. This booklet has been placed in the docket for this rulemaking 
action. See also A. Moorse, ``Recycled rubber goods maker moves into 
production stage,'' Capital District Business Review, Sept. 2, 2000. A 
hard copy of this article has been placed in the docket for this 
rulemaking action; it also is available at http://albany.bcentral.com/albany/stories/20000/09/04/story3.html.
    Scrap tires can also be used as fuel. They represent a potentially 
significant energy source, because they have a heat value slightly 
higher than that of coal (EPA Market Summary, p. 5) and they are 
comparable to or better than coal in terms of emissions of some 
pollutants. See L.Chubb, ``Firestone recall: Where have all the tires 
gone?'' Environmental News Network (``ENN'') , 9/20/2000 (citing 
statement of John Serumgard of the Scrap Tire Management Council). 
Power plants, tire manufacturing plants, cement kilns, and pulp and 
paper mills have used tires as fuel. Usually they burn tires that have 
been shredded into chunks (also known as tire-derived-fuel, or 
``tdf''), because they do not have the capability to burn whole tires. 
Some plants can produce their own tdf in furnaces; others can use tdf 
prepared by others. According to one source, last year, a total of 110 
electricity generating facilities in the U.S. held permits to burn 
tires. See Chubb, ``Firestone recall * * *'', supra. A hard copy of 
this article has been placed in the docket for this rulemaking action; 
it also is available from ENN's website (http://www.enn.com/news/enn-
stories/2000/09/09202000/tires--31672.asp?P=2).

B. Who Would be Required to Comply with the Requirements to file 
Programs and Reports about Disposition and Disposal of Recalled Tires?

    We are proposing that the rule's requirements apply to all 
manufacturers that conduct tire recalls, including vehicle 
manufacturers that conduct recalls to correct defects in their vehicles 
in which the remedy is the replacement of tires.
    TREAD section 7's amendment to subsection 30120(d) provides that, 
for a remedy involving the replacement of tires, the manufacturer shall 
include a plan addressing how to prevent replaced tires from being 
resold for use on motor vehicles or disposed of in landfills. In this 
amendment, Congress added these requirements to the pre-existing 
30120(d) requirement that a manufacturer file with the Secretary a copy 
of the manufacturer's program for remedying a defect or noncompliance. 
In this context, the use of the term ``manufacturer'' in section 7 
indicates that the term applies to all manufacturers that conduct 
recalls of tires under the Safety Act to correct safety-related defects 
or noncompliances with applicable standards.
    Tires are motor vehicle equipment. With respect to the recall 
provisions of the Safety Act, 49 U.S.C. 30118-30121, by regulation 
tires are considered as replacement equipment, even if they were 
installed on a motor vehicle at the time of first sale. 49 CFR 
579.4(b)(2). Therefore, tire manufacturers have the duty to conduct 
notification and remedy campaigns to address defective or noncompliant 
tires, including tires installed on new vehicles. See 49 CFR 579.5(b). 
Tire brand name owners, such as retail chain stores that sell tires 
under their own ``private labels'' or ``house labels'' are also 
considered manufacturers (49 U.S.C. 30102(b)(1)(E)) and have the same 
defect and noncompliance reporting requirements as manufacturers under 
49 CFR 573.3(d). All of these would be required to file reports 
required under the proposed rule, if their tires were found to be 
defective or noncompliant.
    In rare circumstances, vehicle manufacturers also may conduct 
recall campaigns regarding tires installed on their new vehicles. For 
example, Ford Motor Company (Ford) recently announced a recall to 
replace tires on MY 2002 Ford Explorer vehicles whose sidewalls had 
been cut during the vehicle assembly process. Because the tire 
disposition problem also affects tires that are removed during these 
recalls, the proposed rule also applies to vehicle manufacturers that 
initiate tire recalls.

C. What Elements Would the Manufacturers' Plans Address?

1. Summary
    We are proposing to require manufacturers to include information 
about their plans for incapacitating and disposing of recalled tires in 
their remedy programs, and to require that manufacturers implement 
these plans. We are proposing that manufacturers' plans address, at a 
minimum, three

[[Page 65168]]

major issues: (1) Ways of assuring that the entities replacing the 
tires are aware of legal prohibitions on the sale of the defective or 
noncompliant tires under the Safety Act, (2) methods to impair recalled 
tires so that they cannot be used on a vehicle, and (3) the disposition 
of recalled tires, consistent with applicable laws and in ways that 
minimize their deposit in landfills. NHTSA believes that the extent of 
the manufacturer's control over recalled tires likely would vary, 
depending on the nature of the manufacturer's relationship with each of 
the facilities that replace the recalled tires, which may range from 
wholly-owned and franchised tire dealers to independent tire dealers, 
motor vehicle dealers, and service stations. We are proposing that 
where the manufacturer controls the tire outlet, the manufacturer 
direct proper disposition of the tire. Where the manufacturer does not 
have control, we are proposing that the manufacturer provide 
informational materials to the outlets, including information about the 
legal prohibitions on the resale of the tires.
    We are proposing ``exceptions reporting'', by manufacturer-
controlled tire outlets to manufacturers monthly and by manufacturers 
to NHTSA in quarterly reports filed pursuant to 49 CFR 573.6. These 
reports would identify the aggregate number of recalled tires which the 
manufacturer becomes aware have not been rendered unsuitable for resale 
for installation on a motor vehicle in accordance with the 
manufacturer's plan; the aggregate number of recalled tires which the 
manufacturer becomes aware have been disposed of in violation of 
applicable state and local laws and regulations; and a description of 
any such failures of tire outlets to act in accordance with the 
manufacturer's plan, including an identification of the outlets in 
question.
2. Legislative Background
    As described above, section 7 of the TREAD Act provides for two 
independent plans for the disposition of recalled tires: (1) Plans for 
the restriction of the resale of recalled tires and (2) plans for the 
limitation of the disposal of recalled tires in landfills. Each may be 
qualified by the degree of the manufacturer's control over the tire 
replacement process. The first of these provisions was addressed 
originally in proposed section 6 of the House Bill underlying the TREAD 
Act, ``Sales of Replaced Equipment,'' which would have amended 49 
U.S.C. 30120 by adding a requirement, at subsection (d), for the 
manufacturer to have a plan addressing how to prevent replaced tires 
from being sold for installation on motor vehicles, unless they had 
been remedied, to the extent that the manufacturer could reasonably 
control such resales. See H.R. Report No. 106-954, 106th Cong., 2d 
Sess., pp. 4, 15. This provision did not address the issue of how to 
dispose of the unremedied tires, nor did any other part of the original 
bill.
    The first version of the ``anti-landfill'' portion of section 7 of 
the TREAD Act, which was intended to preclude disposition of recalled 
tires in public landfills, was proposed as amendment 1(k) to H.R. 5164, 
offered by Congressman Pallone on October 5, 2000. This proposed 
amendment would have provided that ``[n]o person may dispose of any 
[recalled tire] except in a fashion that protects the public health and 
safety. Disposal of such tires in a public landfill shall not be 
considered adequate protection of the public's health and safety.'' 
Prior to passage of the House bill (H.R. 5164), this amendment was 
withdrawn. See H.R. Rep. No. 106-954, supra, at p. 9.
    Eventually, section 6 of the H.R. 5164 was expanded to include a 
restriction on the disposition of recalled tires in landfills. The 
``reasonable extent of control'' language from section 6 was applied to 
the ``anti-landfill'' provision as well as to the ``no resale without 
repair'' provision; the references to ``protection of the public health 
and safety'' and the direct prohibition of use of recalled tires in 
landfills were dropped from the ``anti-landfill'' provision. Both 
provisions, with identical reporting requirements, appear in section 7 
of the TREAD Act. The legislative history does not provide further 
explanation of Congress' action.
3. The August 2000 Firestone Recall
    Firestone prepared a Recall Fact Sheet (``Fact Sheet''), dated 
August 30, 2000, which was intended to provide Federal, State and local 
authorities with information about the scrap tires collected during the 
company's August 2000 recall. The Fact Sheet contained a general 
description of the procedures in place at the 13,000 authorized service 
centers that were replacing recalled tires to manage the proper 
disposition of those tires. It outlined the following four elements: 
(1) To ensure that recalled tires are not reused on vehicles, the tires 
are to be rendered useless by drilling a hole in or cutting through the 
sidewall upon removal from the vehicle; (2) the company arranged with 
its current scrap tire vendors for additional pickups of scrap tires 
from company-owned stores and arranged with its ``normal transportation 
vendors'' to visit Firestone stores and authorized service centers and 
remove scrap tires; (3) recalled scrap tires are being transported 
directly to licensed and permitted recycling facilities or to Firestone 
distribution facilities where they are checked to ensure that they have 
been rendered useless and then transported to licensed and permitted 
recycling facilities; and (4) ``[t]he majority of the recalled tires 
are being shredded or beneficially reused as fuel for power plants or 
cement kilns, or ground into crumb rubber for recycling into a variety 
of useful products such as playground mats, asphalt, and soaker 
irrigation hoses.'' It also stated that ``none of the recalled tires 
are being redistributed or retreaded.'' This Fact Sheet is available in 
the docket for this rulemaking.
4. Plan Elements
    We are proposing that manufacturers' plans include three elements.
    First, the plans would have to address legal requirements 
established by the Safety Act. In addition to the notifications of the 
existence of a defect or noncompliance required under 49 U.S.C. 30118-
30119, at a minimum manufacturers would be required to notify all 
entities that are authorized to replace the tires in question, 
including their owned stores, franchised dealers, and distributors, as 
well as independent dealers, about the prohibitions and notification 
requirements in the Safety Act as they apply to recalled tires. This 
includes the ban on the sale of new defective or noncompliant tires (49 
U.S.C. 30120(i), see generally 66 FR 38247 et seq. (July 23, 2001)); 
the prohibition on the sale of new and used defective and noncompliant 
tires (49 U.S.C. 30120(j), see generally 66 FR 38247 et seq. (July 23, 
2001)); and the duty to notify NHTSA of any sale of a new or used 
recalled tire for use on a motor vehicle (49 U.S.C. 30166(n)), see 
generally 49 CFR 573.10, 66 FR 38159 et seq. (July 23, 2001)). The 
manufacturer would have to provide informational materials on the 
prohibitions and notification requirements to all authorized 
replacement outlets. For the tire outlets that are company-owned or 
otherwise subject to the control of the manufacturer, the manufacturer 
would also be required to provide written direction to the person in 
charge of each outlet to comply with the law and to notify all 
employees involved in replacing, handling, or disposing of recalled 
tires of the requirements.
    Second, manufacturers would be required to set forth their programs 
to assure, insofar as possible, that the recalled tires are not resold 
for

[[Page 65169]]

installation on a motor vehicle. As above, company-owned and other 
stores controlled by the company would be directed to permanently alter 
the tires so that they could not be used on vehicles. This could 
include, for example, drilling substantial (e.g. \1/2\ inch) holes in 
the sidewalls, cutting the tire beads, or sawing the tires in half. To 
ensure that this alteration is performed, we are also proposing that 
stores be directed to do it before the end of the business day on which 
the recalled tire has been removed from the vehicle. We seek comments 
on whether this time period is sufficient or whether, and why, a 
different time period should be specified. The manufacturer would have 
to provide authorized tire outlets that it does not control with 
guidance on how to permanently alter the tires so that they could not 
be used on vehicles and request them to do that promptly.
    Third, manufacturers would be required to describe their plans 
aimed at limiting the disposal of recalled tires in landfills and, 
instead, channeling them into a category of positive reuse (shredding, 
crumbling, recycling, and recovery) or another alternative beneficial 
non-vehicular use. The proposed rule would require that the 
manufacturers' plans provide that company-controlled outlets dispose of 
all recalled tires in accordance with applicable state and/or local 
laws and regulations. We are further proposing that manufacturers 
provide directions to their stores and guidance to independent dealers 
about disposition of tires in a manner that, to the extent possible, 
avoids landfilling.
    We seek comments on whether to require manufacturers to provide 
outlets that are authorized to replace tires with information that 
summarizes the applicable laws and regulations regarding disposal of 
tires in their jurisdictions and that identifies reputable tire 
collection and transportation contractors as well as facilities in 
their areas that would accept unrepairable recalled tires for a 
beneficial use. We believe that this information would be useful to 
outlets that replace recalled tires, but we do not know the extent to 
which they already have it. We assume that some manufacturers already 
provide such information, but we do not know how many do so or the 
types of information that are provided. We are interested in comments 
on whether providing this information has proved useful to 
manufacturers and their dealers and on the extent of the burden that 
such a requirement would create.
    It is possible that manufacturers could include conditions 
governing tire disposition in their contracts for supply of replacement 
tires to independent outlets. If this were done, it would help to 
assure appropriate disposition of recalled tires by outlets not 
controlled by the manufacturer. Because we do not know whether 
manufacturers' past and/or existing contracts contain restrictions or 
other provisions with respect to the re-use and disposition of recalled 
tires, the proposed rule does not address this topic. We seek comments 
on this issue, as well as on whether conditions could be included in 
the future and what they would be.
    In addition, manufacturers would be required to implement their 
plans for conducting programs to ensure that recalled tires are 
rendered unsuitable for installation on a motor vehicle for resale and 
for limiting the disposal of recalled tires in landfills.
    We seek comments on the above proposal for plans and, depending on 
the comments, may modify the plan requirements. If you suggest 
additional items, please include in your comments information about the 
associated costs.
5. Quarterly Reporting
    Section 7 provides that we must require manufacturers to ``include 
information about the implementation of such plan with each quarterly 
report to the Secretary regarding the progress of any notification 
[and] remedy campaigns.'' The contents of these quarterly reports are 
currently described in 49 CFR 573.6.
    In order to minimize administrative burdens on manufacturers, we do 
not plan to require that manufacturers include in their quarterly 
reports the number of recalled tires that have been rendered unsuitable 
for resale on motor vehicles or the number of recalled tires that have 
been disposed of by various means. Instead, we propose to require 
``exceptions reporting'' under which manufacturers must advise us of 
only those instances of which they become aware in which their plans 
were not followed. The required quarterly reports from manufacturers to 
us would include the aggregate number of recalled tires which the 
manufacturer becomes aware have not been rendered unsuitable for resale 
for installation on a motor vehicle in accordance with the 
manufacturer's plan and the aggregate number of recalled tires which 
the manufacturer becomes aware have been disposed of in violation of 
applicable state and local laws and regulations. The manufacturer would 
also be required to describe any such failures of tire outlets to act 
in accordance with the directions in the manufacturer's plan, including 
an identification of the outlet(s) in question. To permit manufacturers 
to report this information in a timely fashion, the proposal would 
require manufacturer-controlled outlets that dispose of tires to report 
the same categories of information monthly to the manufacturer. We seek 
comments on effective reporting mechanisms and on the burdens that such 
reporting would impose on the outlets.

D. What Role Does NHTSA Intend to Play With Respect to the 
Manufacturers' Plans for the Disposition of Tires?

    Under today's proposal, NHTSA's role with respect to reviewing the 
manufacturers' plans for the disposition of recalled tires would be 
limited to examining the manufacturers' plans, programs, and reports to 
see whether they contain the required items of information. We believe 
that our list of required reporting elements is sufficiently 
comprehensive and specific to ensure that the plans will effectuate 
Congressional objectives. Also, the proposed rule would require that 
the manufacturers' plans demonstrate that they have directed the 
entities that are replacing recalled tires to dispose of them in 
accordance with applicable laws. We note that in virtually every state, 
the disposition of used tires already is subject to regulation under 
State and/or local statutes and regulations. However, we do not have 
the resources or the expertise to review the manufacturers' 
characterizations of applicable requirements under those environmental 
laws. Of course, the failure of a manufacturer to implement its plan in 
accordance with its terms would constitute a violation of the Safety 
Act.

III. Regulatory Analyses and Notices

A. Executive Order 12866 and DOT Regulatory Policies and Procedures

    We have considered the impact of this proposed rulemaking action 
under E.O. 12866 and the Department of Transportation's regulatory 
policies and procedures. This rulemaking was not reviewed under E.O. 
12866, ``Regulatory Planning and Review.'' This rulemaking is not 
considered ``significant'' under the Department of Transportation's 
regulatory policies and procedures. The impacts of this rule are 
expected to be so minimal as not to warrant preparation of a full 
regulatory evaluation because this provision essentially would require 
only the supplementing of reports that manufacturers already must file 
with limited information about the disposition of recalled tires.

[[Page 65170]]

    We estimate that the additional economic impact of this rule upon 
manufacturers would be small. Manufacturers already assume the costs of 
the tire recalls that they conduct. They already are required by our 
regulations to notify dealers of recalls and to file plans and 
quarterly reports about their recalls with our Office of Defects 
Investigation (ODI). The additional notification and reporting elements 
that this rule would add would be very limited and wholly descriptive. 
They would not impose significant costs on manufacturers.
    In general, the radial tires that are in widespread use today are 
far safer than older technology tires and are subject to few 
significant recalls. Although the two recalls recently conducted by 
Bridgestone/Firestone, Inc. of Firestone ATX and Wilderness AT tires 
were very large, this is unusual. In the 1980s and 1990s, there were 
relatively few recalls of large numbers of tires. In the past five 
years, the average number of tire recalls per year was five, the 
average population of recalled tires per year was 28,389, and the 
average recall involved 5,678 tires, excluding the aforementioned 
Bridgestone/Firestone recalls and a Cooper Tire recall (No. 99T-005), 
which covered only two (2) tires. (This excludes recalls to correct 
labeling errors.) Therefore, we do not anticipate that there will be 
large numbers of tire recalls for which manufacturers would be required 
to file programs and plans under our proposed rule.
    Finally, this rule essentially would require manufacturers to take 
steps to facilitate compliance by entities that replace recalled tires 
with applicable state and local laws regarding tire disposition. Since 
it is likely that these entities already comply with applicable 
requirements for disposal of returned tires, this rule would not add 
any substantive burdens or compliance costs. Even in the unlikely event 
of complete disregard of applicable disposal requirements (in which 
case 100% of the cost of compliance might be viewed as a cost of this 
rule), the additional costs for recycling 100% of the tires recalled 
annually would be $141,945 for the tire industry as a whole, or $28,390 
per average tire recall (assuming 28,389 tires recalled annually, or 
5,678 tires recalled per average tire recall, multiplied by $5.00 
(including $2.00 to incapacitate each recalled tire, $1.00 to collect 
each recalled tire, and $2.00 to recycle each recalled tire)). For 
these reasons, we believe that the additional economic effect of this 
rule would be minimal.

B. Regulatory Flexibility Act

    We have also considered the impacts of this notice under the 
Regulatory Flexibility Act. For the reasons discussed above under E.O. 
12866 and the DOT Policies and Procedures, I certify that this proposed 
rule would not have a significant economic impact on a substantial 
number of small entities. The primary impact of this proposed rule 
would be felt by the major tire manufacturers, which are not small 
entities. This impact would be minor, since it primarily would involve 
adding a description of plans for incapacitating and disposing of 
recalled noncompliant or defective tires to their remedy programs, 
notifying affected retail outlets of the plans, and providing minimal 
reporting on the plans in the quarterly reports that manufacturers 
already must file with NHTSA. We estimate this cost at $1.00 per tire 
manufacturer per affected retail outlet, but the cost could well be 
less because manufacturers may already be including such descriptions 
in their notices to dealers.
    Disposal requirements would be governed by applicable State and 
local laws and regulations. It is likely that manufacturers and 
entities that replace tires already are complying with applicable 
requirements for tire disposal. If not, manufacturers, who we 
understand currently pay for tire recalls, would incur the costs 
associated with tire disposal, e.g. the costs of transporting disabled 
tires and the costs of recycling the tires. We estimate these costs at 
approximately $1.00 per tire for transportation and $2.00 per tire for 
recycling.
    This proposed rule could also have an impact on the nation's 3,500 
tire dealers, many of which are small entities. If they do not comply 
with applicable requirements for tire disposal, manufacturer-controlled 
tire dealers would incur the costs of monthly ``exceptions reporting'' 
to manufacturers of any instances in which the dealer did not comply 
with the manufacturer's plan for disposing of recalled tires. We 
estimate these reporting costs at $1.00 per affected dealer per recall. 
Each dealer could also incur a one-time cost for obtaining equipment to 
incapacitate tires so that the tires cannot be resold to the public. 
The one time-cost would likely range between $70.00 (to purchase a 
power drill and a drill bit) and $95.00 (to purchase a cutoff saw and 
blade(s)) per affected dealer, or a maximum of between $245,000 and 
$332,500, assuming that each of the 3,500 dealers purchases a new drill 
and bit or cutoff saw and blade. We believe that many dealers already 
own such equipment and that therefore the maximum aggregate one-time 
cost would be far lower. Also, we note that, because not every dealer 
is involved in a tire recall every year, the aggregate one-time cost 
would be incurred over a multi-year time period.

C. National Environmental Policy Act

    We have reviewed this proposal for the purposed of compliance with 
the National Environmental Policy Act (42 U.S.C. 4321 et seq.) and 
determined that it would not have a significant impact on the quality 
of the human environment. The proposed rule would not require 
manufacturers to conduct any recalls beyond those that they already are 
required to conduct. The sale of recalled tires is prohibited by other 
provisions in the Safety Act. Disposal requirements are already 
governed by other State laws and regulations.

D. Paperwork Reduction Act

    This proposed rule would impose new collection of information 
burdens within the meaning of the Paperwork Reduction Act of 1995 (PRA) 
(44 U.S.C. chapter 35). However, those burdens should be minimal. 
Manufacturers already are required by our regulations to file plans and 
quarterly reports about tire recalls with our ODI. There would be an 
incremental burden of adding to their descriptions of their programs. 
Even this impact would be minor, since it only would involve adding a 
description of plans for incapacitating and disposing of recalled 
noncomplying or defective tires to their remedy programs and providing 
minimal reporting on the plans in the quarterly reports that 
manufacturers already must file with NHTSA. The additional reporting 
elements that this proposed rule would require of manufacturers and of 
manufacturer-controlled outlets that implement recalls, i.e. periodic 
``exceptions reporting'' of aggregate numbers of recalled tires that 
have not been incapacitated for use or that have been disposed of 
unlawfully, describing any failure to comply with the manufacturer's 
plan to render tires unsuitable for installation on a motor vehicle for 
resale and any failure to comply with the disposal requirements of 
applicable state and local laws and regulations of which the 
manufacturer becomes aware, would be very limited and primarily 
descriptive. We believe that compliance with the proposed rule would 
not impose significant additional costs or burdens either on the 
manufacturers that conduct the tire

[[Page 65171]]

recalls or on the manufacturer-controlled outlets that implement them. 
In furtherance of the recognition in section 7 that the manufacturer's 
ability to influence the recalls will vary according to the degree to 
which it controls the outlets that carry out the recalls, we do not 
propose to require even this limited ``exceptions reporting'' by 
manufacturers with respect to outlets that the manufacturer does not 
control.
    Because this proposed rule would impose information collection 
requirements, albeit minimal, as that term is defined by the Office of 
Management and Budget (OMB) in 5 CFR part 1329, we plan to submit the 
proposed requirements to OMB for its approval, as required by the PRA. 
We seek comments on the information collection burdens associated with 
this proposed rule.

E. Executive Order 13132 (Federalism)

    Executive Order 13132 on ``Federalism'' requires us to develop an 
accountable process to ensure ``meaningful and timely input'' by State 
and local officials in the development of ``regulatory policies that 
have federalism implications.'' The E.O. defines this phrase to include 
regulations ``that 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.'' This proposed rule, which would require that 
manufacturers include a plan for disposal of recalled tires in their 
remedy programs under either section 30118(b) or 30118(c) of the Safety 
Act, will not have 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, as specified in E.O. 13132. This rulemaking does not have 
those implications because it applies directly only to manufacturers 
who are required to file a remedy plan under sections 30118(b) or 
30118(c), rather than to the States or local governments, and because 
it directs manufacturers to file plans that conform with applicable 
state and/or local requirements.

F. Civil Justice Reform

    This proposed rule would not have a retroactive or preemptive 
effect. Judicial review of the rule may be obtained pursuant to 5 
U.S.C. 702. That section does not require that a petition for 
reconsideration be filed prior to seeking judicial review.

G. Unfunded Mandates Reform Act of 1995

    The Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) requires 
agencies to prepare a written assessment of the cost, benefits and 
other effects of proposed or final rules that include a Federal mandate 
likely to result in the expenditure by State, local or tribunal 
governments, in the aggregate, or by the private sector, of more than 
$100 million annually. Because this rule would not have a $100 million 
annual effect, no Unfunded Mandates assessment is necessary and one 
will not be prepared.

H. Plain Language

    Executive Order 12866 and the President's memorandum of June 1, 
1998, require each agency to write all rules in plain language. 
Application of the principles of plain language includes consideration 
of the following questions:

--Have we organized the material to suit the public's needs?
--Are the requirements in the rule clearly stated?
--Does the rule contain technical language or jargon that is not clear?
--Would a different format (grouping and order of sections, use of 
headings, paragraphing) make the rule easier to understand?
--Would more (but shorter) sections be better?
--Could we improve clarity by adding tables, lists, or diagrams?
--What else could we do to make the rule easier to understand?

    If you have any responses to these questions, please include them 
in your comments on this rule.

IV. Submission of Comments.

A. How Can I Influence NHTSA's Thinking on This Rule?

    In developing this notice of proposed rulemaking, we tried to 
address the anticipated concerns of all our stakeholders. Your comments 
will help us decide what to include in the rule and to improve the 
proposed rule. We invite you to provide different views on it, new 
approaches we have not considered, new data, how this rule may affect 
you, or other relevant information. Your comments will be most 
effective if you follow the suggestions below:
    Explain your views and reasoning as clearly as possible.
     Provide solid information to support your views.
     If you estimate potential numbers or reports or costs, 
explain how you arrived at the estimate.
     Tell us which parts of the rule you support, as well as 
those with which you disagree.
     Provide specific examples to illustrate your concerns.
     Offer specific alternatives.
     Refer your comments to specific sections of the rule, such 
as the units or page numbers of the preamble, or the regulatory 
sections.
     Be sure to include the name, date, and docket number with 
your comments.

B. How Do I Prepare and Submit Comments?

    Your comments must be written and in English. To ensure that your 
comments are correctly filed in the Docket, please include the docket 
number of this document in your comments.
    Your comments must not be more than 15 pages long. (49 CFR 553.21.) 
We established this limit to encourage you to write your primary 
comments in a concise fashion. However, you may attach necessary 
additional documents to your comments. There is no limit on the length 
of the attachments.
    Please submit two copies of your comments, including the 
attachments, to Docket Management at the address given above under 
ADDRESSES.
    Comments may also be submitted to the docket electronically by 
logging onto the Docket Management System website at http://dms.dot.gov. Click on ``Help & Information'' or ``Help/Info'' to obtain 
instructions for filing the document electronically.

C. How can I be Sure That my Comments Were Received?

    If you wish Docket Management to notify you upon its receipt of 
your comments, enclose a self-addressed, stamped postcard in the 
envelope containing your comments. Upon receiving your comments, Docket 
Management will return the postcard by mail.

D. How do I Submit Confidential Business Information?

    If you wish to submit any information under a claim of 
confidentiality, you should submit three copies of your complete 
submission, including the information you claim to be confidential 
business information, to the Chief Counsel (NCC-30), NHTSA, at the 
address given above under FOR FURTHER INFORMATION CONTACT. In addition, 
you should submit two copies, from which you have deleted the claimed 
confidential business information, to Docket Management at the address 
given above under ADDRESSES. When

[[Page 65172]]

you send a comment containing information claimed to be confidential 
business information, you should include a cover letter setting forth 
the information specified in our confidential business information 
regulation. (49 CFR part 512.)

E. Will the Agency Consider Late Comments?

    We will consider all comments that Docket Management receives 
before the close of business on the comment closing date indicated 
above under DATES. To the extent possible, we will also consider 
comments that Docket Management receives after that date. If Docket 
Management receives a comment too late for us to consider it in 
developing a final rule (assuming that one is issued), we will consider 
that comment as an informal suggestion for future rulemaking action.

F. How can I Read the Comments Submitted by Other People and Other 
Materials Relevant to this Rulemaking?

    You may view the materials in the docket for this rulemaking on the 
Internet. These materials include background information on the use of 
tires in landfills and written comments submitted by other interested 
persons. You may read them at the address given above under ADDRESSES. 
The hours of the Docket are indicated above in the same location.
    You may also see the comments and materials on the Internet. To 
read them on the Internet, take the following steps:
    (1) Go to the Docket Management System (DMS) Web page of the 
Department of Transportation (http://dms.dot.gov/).
    (2) On that page, click on ``search.''
    (3) On the next page (http://dms.dot.gov/search/), type in the 
four-digit docket number shown at the beginning of this document. 
Example: If the docket number were ``NHTSA-2000-1234,'' you would type 
``1234.'' After typing the docket number, click on ``search.''
    (4) On the next page, which contains docket summary information for 
the materials in the docket you selected, click on the desired 
comments. You may download the comments.
    Please note that even after the comment closing date, we will 
continue to file relevant information in the Docket as it becomes 
available. Further, some people may submit late comments. Accordingly, 
we recommend that you periodically check the Docket for new material.

List of Subjects in 49 CFR Part 573:

    Defects, Motor vehicle safety, Noncompliance, Reporting and 
recordkeeping requirements, Tires.

    In consideration of the foregoing, NHTSA proposes to amend 49 CFR 
part 573 as set forth below.
    1. The authority citation for part 573 continues to read as 
follows:

    Authority: 49 U.S.C. 30102-103, 30112, 30117-121, 30166-167; 
delegation of authority at 49 CFR 1.50.
    2. In Sec. 573.5, redesignate paragraphs (c)(9) through (c)(11) as 
paragraphs (c)(10) through (c)(12) and by add a new paragraph (c)(9) to 
read as follows:


Sec. 573.5  Defect and noncompliance information report.

* * * * *
    (c) * * *
    (9) In the case of a remedy program involving the replacement of 
tires, the manufacturer's program for remedying the defect or 
noncompliance shall:
    (i) Include a plan for assuring that the entities replacing the 
tires are aware of the legal requirements related to recalls of tires 
established by 49 U.S.C. Chapter 301, including regulations thereunder;
    (ii) Address how the manufacturer will prevent, to the extent 
reasonably within its control, the recalled tires from being resold for 
installation on a motor vehicle; and
    (iii) Address how the manufacturer will limit, to the extent 
reasonably within its control, the disposal of the recalled tires in 
landfills and, instead, channel them into a category of positive reuse 
(shredding, crumbling, recycling, and recovery) or another alternative 
beneficial non-vehicular use.
    (A) With respect to the requirement in paragraph (c)(9)(i) of this 
section, at a minimum, the manufacturer shall notify its owned stores, 
franchised dealers, and/or distributors, as well as all independent 
outlets that are authorized to replace the tires that are the subject 
of the recall, about the prohibitions and notification requirements in 
Chapter 301. This includes notification of the ban on the sale of new 
defective or noncompliant tires (49 U.S.C. 30120(i)); the prohibition 
on the sale of new and used defective and noncompliant tires (49 U.S.C. 
30120(j)); and the duty to notify NHTSA of any sale of a new or used 
recalled tire for use on a motor vehicle (49 U.S.C. 30166(n)). For tire 
outlets that are manufacturer-owned or otherwise subject to the control 
of the manufacturer, the manufacturer shall also provide directions to 
comply with these statutory provisions and the regulations thereunder.
    (B) With respect to the requirement in paragraph (c)(9)(ii) of this 
section, the manufacturer's program must, at a minimum, include the 
following:
    (1) Written directions to manufacturer-owned and other 
manufacturer-controlled outlets to alter the recalled tires permanently 
so that they cannot be used on vehicles, and instructions on how and 
when to perform such alterations. These shall include instructions on 
the means to render recalled tires unsuitable for resale for 
installation on motor vehicles and instructions to perform the 
incapacitation of each recalled tire by the close of business on the 
day on which recalled tire has been removed from the vehicle;
    (2) Written guidance to all other outlets that are authorized to 
replace the recalled tires on how to alter the recalled tires promptly 
and permanently so that they cannot be used on vehicles; and
    (3) A requirement that manufacturer-owned and other manufacturer-
controlled outlets report to the manufacturer on a monthly basis the 
number of recalled tires removed from vehicles by the outlet that have 
not been rendered unsuitable for resale for installation on a motor 
vehicle within the specified time frame and describe any such failure 
to comply with the manufacturer's plan;
    (C) With respect to the requirement in paragraph (c)(9)(iii) of 
this section, the manufacturer's program must, at a minimum, include 
the following:
    (1) Written directions that require manufacturer-owned and other 
manufacturer-controlled outlets to comply with applicable state and 
local laws and regulations regarding disposal of tires, and that 
provide further direction and guidance to manufacturer-owned and other 
manufacturer-controlled outlets on how to limit the disposal of 
recalled tires in landfills and, instead, channel them into a category 
of positive reuse (shredding, crumbling, recycling, and recovery) or 
another alternative beneficial non-vehicular use;
    (2) Written guidance to all other outlets that are authorized to 
replace the recalled tires regarding the duty to comply with applicable 
state and local laws and regulations regarding disposal of tires; and
    (3) A requirement that manufacturer-owned and other manufacturer-
controlled outlets report to the manufacturer on a monthly basis the 
number of recalled tires disposed of in violation of applicable laws 
and regulations. Each such report shall include a description of any 
such failure of the tire outlet to act in accordance

[[Page 65173]]

with the directions in the manufacturer's plan.
    (D) As used in this paragraph, written directions to a 
manufacturer-owned or controlled outlet shall be sent to the person in 
charge of each outlet with further instructions to notify all employees 
of the outlet who are involved with removal, rendering unsuitable for 
use, or disposition of recalled tires of the above requirements.
    (E) Manufacturers must implement the plans for disposition of 
recalled tires that they file with NHTSA pursuant to this paragraph. 
The failure of a manufacturer to implement its plan in accordance with 
its terms constitutes a violation of the Safety Act.
* * * * *
    3. In Sec. 573.6, add paragraph (b)(7) to read as follows:


Sec. 573.6  Quarterly reports.

* * * * *
    (b) * * *
    (7) For all recalls that involve the replacement of tires, the 
manufacturer shall provide
    (i) The aggregate number of recalled tires which the manufacturer 
becomes aware have not been rendered unsuitable for resale for 
installation on a motor vehicle in accordance with the manufacturer's 
plan provided to NHTSA pursuant to Sec. 573.5(c)(9) of this part;
    (ii) The aggregate number of recalled tires which the manufacturer 
becomes aware have been disposed of in violation of applicable state 
and local laws and regulations; and
    (iii) A description of any failure of a tire outlet to act in 
accordance with the directions in the manufacturer's plan, including an 
identification of the outlets in question.

    Issued on: December 11, 2001.
Kenneth N. Weinstein,
Associate Administrator for Safety Assurance.
[FR Doc. 01-30998 Filed 12-17-01; 8:45 am]
BILLING CODE 4910-59-P