This final rule incorporates, by reference, the “American National Standard, Household Electric Dishwashers, ANSI/AHAM DW-1-1992” published by the Association of Home Appliance Manufacturers (AHAM). You may obtain copies of the referenced standard AHAM DW-1 from the Association of Home Appliance Manufacturers, 1111 19th Street, NW., Suite 402, Washington, DC 20036, (202) 872-5955. Information regarding this rulemaking is also available on the Office of Codes and Standards web site at the following address: http://www.eren.doe.gov/buildings/codes_standards/index.htm.

Part B of Title III of the Energy Policy and Conservation Act, as amended (EPCA or Act), establishes the Energy Conservation Program for Consumer Products Other Than Automobiles (Program). The products currently subject to this Program (“covered products”) include residential dishwashers, the subject of today's final rule.

Under the Act, the Program consists of three parts: testing, labeling, and the Federal energy conservation standards. The Department, in consultation with the National Institute of Standards and Technology (NIST), must amend or establish test procedures as appropriate for each of the covered products. Section 323 of EPCA, 42 U.S.C. 6293. The purpose of the test procedures is to measure energy efficiency, energy use, or estimated annual operating cost of a covered product during a representative average use cycle or period of use. The test procedure must not be unduly burdensome to conduct. Section 323(b)(3) of EPCA, 42 U.S.C. 6293(b)(3).

If a test procedure is amended, DOE is required to determine to what extent, if any, the new test procedure would alter the measured energy efficiency or measured energy use of any covered product as determined under the existing test procedure. If DOE determines that an amended test procedure would alter the measured efficiency or measured energy use of a covered product, DOE is required to amend the applicable energy conservation standard accordingly. In determining the amended energy conservation standard, DOE is required to measure the energy efficiency or energy use of a representative sample of covered products that minimally comply with the existing standard. The average efficiency of these representative samples, tested using the amended test procedure, constitutes the amended standard. Section 323(e)(1) of EPCA, 42 U.S.C. 6293(e)(1). DOE has determined that today's amended test procedure does not alter the measured efficiency or measured energy use of dishwashers.

Beginning 180 days after a test procedure for a product is prescribed, no manufacturer, distributor, retailer, or private labeler may make representations with respect to the energy use, efficiency, or cost of energy consumed by such products, except as reflected in tests conducted according to the DOE procedure. Section 323(c)(2) of EPCA, 42 U.S.C. 6293(c)(2).

On September 28, 1999, the Department published a Notice of Proposed Rulemaking (proposed rule) (64 FR 52248) that proposed a new test procedure for residential dishwashers. The key technological development that triggered the need for revision was the introduction of adaptive control or soil-sensing models. Industry and government tests indicated that the existing test method using only clean dishes did not produce results that would accurately reflect the energy consumed by these machines in a real use environment. The Association of Home Appliance Manufacturers (AHAM) proposed a new approach for testing the soil-sensing models using a formula to weight and average the energy consumption of the minimum and maximum sensor normal cycles. We adapted that method and presented it for comment in the September 28, 1999, proposed rule, along with several other issues such as the definitions for compact and standard models, a revision in the average number of times dishwashers are used each year, and some new specifications for improving testing repeatability. We held a public workshop on November 2, 1999, to discuss the proposed changes, with particular focus on the new method for testing soil-sensing or adaptive control models.

However, because of the questions raised at the workshop and the need expressed by industry to gather additional data and explore alternatives to the proposed method for testing soil-sensing models, we reopened the comment period and extended the deadline for comments to February 14, 2000. Again, comments raised problems with the proposed method. Stakeholders questioned the data supporting the selection of the percentages used to reflect the relative amount of soil encountered by soil-sensing dishwashers in typical loads. (Natural Resources Defense Council (NRDC), No. 4 at 2, and Schleede, No. 8 at 3). Others cited insufficient knowledge as to how different machines would actually react to varying soil loads, that is, what length cycle would be triggered under different wash conditions. (Oregon Office of Energy (OOE), No. 9 at 1). One manufacturer commented that the original AHAM method did not do an adequate job of reflecting the performance of their machines' pressure-based, soil-sensing technology. (Whirlpool, No. 6 at 6).

AHAM concluded that because of significant changes and variations in soil-sensing technology, it was premature to publish a new test method for those models at this time. AHAM cited the need for additional study by industry before their members could propose a new test procedure which would accurately test the response and performance of machines using a variety of soil-sensing technologies. They suggested that we divide the rulemaking into two parts with the following course of action: first, we should proceed to finalize the proposed modifications to improve testing reliability, revise the definitions for compact and standard models, and update the number of use cycles per year to reflect current consumer use patterns. However, AHAM recommended that we should wait to publish a new, comprehensive method for testing soil-sensing models until industry completed additional testing and proposed a new test procedure. (AHAM No. 12 at 8).

Following these comments, DOE further investigated the variety of soil-sensing technologies in the market. We determined that additional data and research were required before an adequate test procedure for all soil-sensing models could be devised. As a result, we agreed that it was premature to finalize a rulemaking for those models at this time. We also agreed that we should not wait to finalize the other proposed changes—the testing specifications, the definitions for compact and standard models, and the reduction in the average number of use cycles per year. These changes are needed to improve the reliability of the current test procedure, and to update the inputs for calculating the estimated operating cost of all models. Therefore, we are deferring the proposal of a new method for testing soil-sensing machines until NIST, industry, and other stakeholders complete the studies necessary for enacting a definitive test procedure. This final rule substantially retains the original test procedure, but adds new testing specifications, definitions, and a new number for average use cycles per year. We will continue to work with industry after this final rulemaking is enacted to develop a test procedure that accurately reflects the cycle performance of the variety of technologies used by soil-sensing machines. We anticipate that the final rule addressing soil-sensing dishwashers will be completed in 2003.

The following are the major revisions to the dishwasher test procedure included in this final rule:

1. Update the test procedure to reflect changes in consumer practices:

• Reduce the representative average number of use cycles per year to 264; and

• Base the definitions of compact and standard dishwashers on place-setting capacity.

2. Improve testing repeatability:

• Tighten the tolerance for ambient temperature;

• Add more detail to test chamber installation requirements.; and

• Add an instruction for manufacturers to run a conditioning cycle prior to the test.

While this final rule retains many of the improvements to the test procedure for measuring the energy use of dishwashers presented in the September 28, 1999, proposed rule, it also includes important changes. Most significantly, we are withdrawing the new method described in the proposed rule for testing adaptive control dishwashers. We are retaining the original method currently in effect for testing conventional and adaptive control dishwashers until we adopt, with the assistance of the dishwasher industry and other stakeholders, a new test method that will accurately test machines using a variety of sensor technologies. Manufacturers of soil-sensing machines will continue to record the energy consumption of those models by measuring the energy used when the dishwasher runs the specified load of clean dishes through the normal cycle.

Although the Department recognizes the importance of determining a test method which will accurately reflect the energy performance of soil-sensing models under real life conditions, it became clear from all comments submitted during the Notice of Proposed Rulemaking process that additional research was necessary. Both industry and environmental advocates shared concerns that there was insufficient understanding of how the machines performed under “typical” soil conditions, and what those “typical” soil conditions actually were. The Natural Resources Defense Council (NRDC), for example, urged the Department not to “make changes in the test procedure unless they are supported by data.” (NRDC No. 4 at 1). AHAM stressed that “there have been significant changes in technology with regard to soil-sensing dishwashers and there is still additional information needed on the usage of these units.” (AHAM No. 12 at 8).

The Department at first considered adopting an interim strategy for improving, at least partially, the accuracy of the energy factors derived from tests of soil-sensing models using only clean dishes. One proposal was imposing a maximum cap on the energy factor that could be claimed from using the conventional test method. However, the lack of reliable, statistical information in this area was one issue of significant concern during the workshop and comment periods: how to ascertain, with accuracy, the typical soil load, and then understand how a variety of soil-sensing models will function in response to that load. Therefore, rather than focusing time, resources, and research on an interim proposal, we decided to concentrate on the development of a permanent test method. We have underway, for example, a research project to evaluate available information on consumer behavior regarding the soil levels of typical dishwasher loads. This study will assess the validity and adequacy of existing consumer behavior data, and suggest a means of relating the different consumer usage patterns with amounts and characteristics of food soils. This information will point the direction toward translating that average soil load into a repeatable test load for testing dishwashers with adaptive controls and soil sensors. It appears that using a repeatable soil load may be the only solution for accurately testing the energy and water consumption of a variety of adaptive control dishwashers.

Although there are several existing soil tests for dishwashers, both national (such as the AHAM DW-1) and international, none of these currently satisfy our requirements for designing a normal test that is representative of the average soil load introduced by consumers. Since these methods test for both cleaning performance and energy consumption, they feature a very challenging soil load designed to be an extreme test of the dishwasher. However, it may be possible to use a reduced number of soiled dishes from one or a combination of these methods to represent normal soiling, recognizing the importance of test repeatability and the need to minimize test burden. We are exploring this possibility in conjunction with consumer use data and expect to present for comment a new test method for soil-sensing dishwashers in a proposed rule to be issued in 2002.

In 1983, DOE amended the dishwasher test procedure to reduce the representative average use from 416 cycles per year to 322 cycles per year based on Proctor and Gamble (P&G) surveys of consumer use conducted prior to 1982. For this rulemaking, in looking for more recent data, the Department learned from industry that the Soap and Detergent Association (SDA) was now the source to be contacted for survey data obtained by detergent manufacturers. By averaging the SDA data for available years between 1985 and 1995, as discussed in the proposed rule, we calculated 264 as the average number of dishwasher use cycles per year.

There were some issues raised at the public workshop regarding the SDA data. Energy Market & Policy Analysis (Schleede) asked about the statistical validity of the survey. (Schleede, Transcript at 19). The Oregon Office of Energy asked as to whether the survey considered such issues as family size. (OOE, Transcript at 23). Northwest Power Planning Council (NPPC) asked about household income and sample size of the data. (NPPC, Transcript at 29). At the workshop, NIST provided additional information regarding the detergent manufacturers' survey method, stating, “The data below comes from our study contacting nationally representative panelists from the standpoint of geography, family size, age of homemaker, gender, income, and employment status. The data are obtained through an independent, outside research organization. This survey is run annually and has a base size of 1,500 to 1,800 respondents.” AHAM commented that the SDA data should be considered as an unbiased source of information because “the manufacturers of dishwasher detergent have, if you will, a vested interest in making sure that the data is absolutely as accurate as they can do because they use it for inventory tracking, and to them it is extremely important to know exactly how much dishwasher detergent is going to be used.” (AHAM, Transcript at 28). The Department believes the SDA data is the best there is regarding dishwasher usage in that it is based on the detergent industry's needs.

AHAM agreed with the Department's decision to use 264 cycles per year as the average figure for dishwasher use. (AHAM, Transcript at 21). Stephens thought the number could be higher because of an upswing in the SDA data for 1995-1996 and believed the data might extrapolate to a Pacific Northwest region 1998-1999 survey which tabulated 281 cycles per year. Stephens recommended that we wait for 1997-1998 detergent manufacturer data. (OOE, No. 9 at 2). Energy Market & Policy Analysis thought the 264 number was too high citing EIA's November 1999 Residential Energy Consumption Survey as a source for consumer use data. (Schleede, No. 10 at 1). He stated that “Data in the recently released EIA report indicates that your (DOE's) estimate of 264 “cycles” is excessive and that the correct number is approximately 220 cycles (or less).” (Schleede, No. 10 at 2).

The Department notes that survey data on the annual usage of dishwashers are likely to vary from year to year. Rather than base its number on any particular one year, the Department prefers to take an average over several years in order to smooth out year to year variations. Regarding the use of the EIA data, NIST reviewed the EIA report which had surveyed 8,000 respondents nationwide and collected data on how often households use automatic dishwashers in an average week. The data, however, do not present a firm, clear figure for the number of dishwasher cycles per year because of the way the information was collected. In the report, the data are provided in bands categorizing dishwasher use per week along with the percentage of responses for each band (less than 4 times per week, 4 to 6 times per week, and at least once per day). In order to use the EIA data, DOE somehow would have to annualize the data or abandon the existing methodology. Neither the EIA data nor the option of abandoning the existing methodology were within the scope of the proposed rule. Rather than reopening the comment period or reproposing the rule for public comment, DOE has decided to continue studying the EIA data with a view toward possibly including it in the forthcoming notice of proposed rulemaking that would cover a test procedure for adaptive control models. In DOE's view, there is ample support in the record for the proposed figure of 264 cycles per year, and the improvement in accuracy that might come from use of the EIA data is not worth the delay in bringing this rulemaking to a conclusion.

In the proposed rule, the Department discussed several changes to clarify the existing test procedure and improve its repeatability when multiple tests are conducted. Although the manufacturers agreed that such changes as tightening the tolerances for ambient temperature testing would improve reproducibility, they expressed concern over one item: the new definition for “truncated normal cycle.” AHAM stated that changing the word “interrupted” to “preset” would unnecessarily increase test burden by requiring additional test runs. Many manufacturers were measuring the energy consumption at the end of the wash cycle, before the power dry, and recording that value as the machine energy consumption for the truncated normal cycle. The cycle was not terminated. The machine then was allowed to complete the power dry, and the energy consumption was measured and recorded as the value of the machine energy consumption for the normal cycle. The current test procedure (sections 2.6.1 and 2.6.2) calls for the user to average the water consumption for the normal and truncated normal cycles. However, the proposal in the proposed rule (section 1.10) called for a separate test cycle to be run for the truncated normal cycle in order to measure the amount of energy consumed during the air dry portion of the cycle. In the public hearing discussions the manufacturers claimed that the energy consumed during the air dry sequence was negligible, regardless of whether the action was to open a vent mechanically and let drying occur by natural convection, or whether mechanical drying was used to assist the air dry. After tests by NIST confirmed the claim that the energy consumption during the air dry sequence was indeed negligible, DOE concluded that a separate cycle need not be run. Under this final rule, manufacturers may continue to extract the normal and truncated normal energy consumption from a single test run.

Thus, the original definition will be retained and reads: “Truncated Normal Cycle” means the normal cycle interrupted to eliminate the power-dry feature after the termination of the last rinse operation.

As discussed in the proposed rule, we are changing the definitions for determining compact and standard models. The new definitions of “compact dishwasher” and “standard dishwasher” use place-setting capacity instead of the measurement of the width of the unit.

In this rule, the Department finalizes amendments to test procedures that may be used to implement future energy conservation standards for dishwashers. The Department has determined that this rule falls into a class of actions that are categorically excluded from review under the National Environmental Policy Act of 1969 (NEPA), 42 U.S.C. 4321 et seq. The rule is covered by Categorical Exclusion A5, for rulemakings that interpret or amend an existing rule without changing the environmental effect, as set forth in the Department's NEPA regulations in appendix A to subpart D, 10 CFR part 1021. This final rule will not affect the quality or distribution of energy usage and, therefore, will not result in any environmental impacts. Accordingly, neither an environmental impact statement nor an environmental assessment is required.

Today's final rule is not a “significant regulatory action” under Executive Order 12866, “Regulatory Planning and Review.” 58 FR 51735 (October 4, 1993). Accordingly, today's action is not subject to review under the Executive Order by the Office of Information and Regulatory Affairs.

The Regulatory Flexibility Act, 5 U.S.C. 601-612, requires that an agency prepare an initial regulatory flexibility analysis for any rule, for which a general notice of proposed rulemaking is required, that would have a significant economic effect on small entities unless the agency certifies that the proposed rule, if promulgated, will not have a significant economic impact on a substantial number of small entities. 5 U.S.C. 605.

Today's rule prescribes test procedures that will be used to test compliance with energy conservation standards. The rule affects dishwasher test procedures and would not have a significant economic impact, but rather would provide common testing methods. Therefore DOE certifies that today's rule would not have a “significant economic impact on a substantial number of small entities,” and the preparation of a regulatory flexibility analysis is not warranted.

DOE has determined pursuant to Executive Order 12630, “Governmental Actions and Interference with Constitutionally Protected Property Rights,” 53 FR 8859 (March 18, 1988), that this regulation would not result in any takings which might require compensation under the Fifth Amendment to the United States Constitution.

Executive Order 13132, “Federalism,” 64 FR 43255 (August 4, 1999), requires that regulations, rules, legislation, and any other policy actions be reviewed for any substantial direct effects on States, on the relationship between the Federal Government and the States, or in the distribution of power and responsibilities among various levels of Government. If there are substantial direct effects, then this Executive Order requires preparation of a Federalism assessment to be used in all decisions involved in promulgating and implementing a policy action.

The rule published today would not regulate or otherwise affect the States. Accordingly, DOE has determined that preparation of a Federalism assessment is unnecessary.

No new information or record keeping requirements are imposed by this rulemaking. Accordingly, no OMB clearance is required under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq.

With respect to the review of existing regulations and the promulgation of new regulations, section 3(a) of Executive Order 12988, “Civil Justice Reform,” 61 FR 4729 (February 7, 1996), imposes on Executive agencies the general duty to adhere to the following requirements: (1) Eliminate drafting errors and ambiguity; (2) write regulations to minimize litigation; and (3) provide a clear legal standard for affected conduct rather than a general standard and promote simplification and burden reduction. With regard to the review required by sections 3(a) and 3(b) of Executive Order 12988, it specifically requires that Executive agencies make every reasonable effort to ensure that the regulation: (1) Clearly specifies the preemptive effect, if any; (2) clearly specifies any effect on existing Federal law or regulation; (3) provides a clear legal standard for affected conduct while promoting simplification and burden reduction; (4) specifies the retroactive effect, if any; (5) adequately defines key terms; and (6) addresses other important issues affecting clarity and general draftsmanship under any guidelines issued by the Attorney General. Section 3(c) of Executive Order 12988 requires Executive agencies to review regulations in light of applicable standards in sections 3(a) and 3(b) to determine whether they are met or it is unreasonable to meet one or more of them. DOE reviewed today's final rule under the standards of section 3 of the Executive Order and determined that, to the extent permitted by law, the final regulations meet the relevant standards.

Section 202 of the Unfunded Mandates Reform Act of 1995 (“Unfunded Mandates Act”) requires that the Department prepare a budgetary impact statement before promulgating a rule that includes a Federal mandate that may result in expenditure by state, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any one year. The budgetary impact statement must include: (i) Identification of the Federal law under which the rule is promulgated; (ii) a qualitative and quantitative assessment of anticipated costs and benefits of the Federal mandate and an analysis of the extent to which such costs to state, local, and tribal governments may be paid with Federal financial assistance; (iii) if feasible, estimates of the future compliance costs and of any disproportionate budgetary effects the mandate has on particular regions, communities, non-Federal units of government, or sectors of the economy; (iv) if feasible, estimates of the effect on the national economy; and (v) a description of the Department's prior consultation with elected representatives of state, local, and tribal governments and a summary and evaluation of the comments and concerns presented.

The Department has determined that the action today does not include a Federal mandate that may result in estimated costs of $100 million or more to State, local or to tribal governments in the aggregate or to the private sector. Therefore, the requirements of Sections 203 and 204 of the Unfunded Mandates Act do not apply to this action.

Section 654 of the Treasury and General Government Appropriations Act, 1999 (Pub. L. No. 105-277) requires Federal agencies to issue a Family Policymaking Assessment for any proposed rule or policy that may affect family well-being. Today's final rule would not have any impact on the autonomy or integrity of the family as an institution. Accordingly, DOE has concluded that it is not necessary to prepare a Family Policymaking Assessment.

Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use,” 66 FR 28355 (May 22, 2001), requires Federal agencies to prepare and submit to the Office of Information and Regulatory Affairs (OIRA), Office of Management and Budget, a Statement of Energy Effects for any proposed significant energy action. A “significant energy action” is defined as any action by an agency that promulgates or is expected to lead to the promulgation of a final rule, and that: (1) Is a significant regulatory action under Executive Order 12866, or any successor order; and (2) is likely to have a significant adverse effect on the supply, distribution, or use of energy; or (3) is designated by the Administrator of OIRA as a significant energy action. For any proposed significant energy action, the agency must give a detailed statement of any adverse effects on energy supply, distribution, or use should the proposal be implemented, and of reasonable alternatives to the action and their expected benefits on energy supply, distribution, and use.

Today's final rule will not have a significant adverse effect on the supply, distribution, or the use of energy, and, therefore, is not a significant energy action. Accordingly, DOE has not prepared a Statement of Energy Effects.

As required by 5 U.S.C. 801, DOE will submit to Congress a report regarding the issuance of today's final rule prior to the effective date set forth at the outset of this notice. The report will state that it has been determined that the rule is not a “major rule” as defined by 5 U.S.C. 801(2).

Title XIII of the Housing and Community Development Act of 1992, Public Law 102-550, entitled the “Federal Housing Enterprises Financial Safety and Soundness Act of 1992” (the “Act”), 1 established the Office of Federal Housing Enterprise Oversight (“OFHEO”) as an independent office within the Department of Housing and Urban Development. OFHEO is the financial safety and soundness regulator of the nation's two largest housing-related Government-sponsored enterprises: the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”) (collectively, the “Enterprises”). In addition to establishing OFHEO, the Act made amendments to the Enterprises' enabling statutes (collectively, “the Charter Acts”)  2 to, among other things, accommodate the restructured regulatory regime under the Act.

The National Flood Insurance Act of 1968 (“NFIA”)  3 and the Flood Disaster Protection Act of 1973 (“FDPA”), 4 as amended by the National Flood Insurance Reform Act of 1994 (“NFIRA”), 5 together establish a comprehensive National Flood Insurance Program (“NFIP”) that includes various provisions designed to ensure that structures built in flood plains are covered by, at least, specified statutory minimum amounts of flood insurance. NFIRA, among other things, added specific requirements explicitly applicable to the Enterprises;  6 designated OFHEO as the Federal agency responsible for determining compliance of the Enterprises' flood insurance responsibilities; required OFHEO to report to Congress on the Enterprises' compliance in the agency's 1996, 1998 and 2000 annual reports;  7 and authorized OFHEO to issue any regulations necessary to carry out the applicable provisions of NFIRA. 8 NFIRA also explicitly authorized OFHEO to impose civil money penalties upon an Enterprise that fails to implement procedures reasonably designed to ensure that the loans it purchases comply with the mandatory flood insurance purchase requirements. 9

More specifically, NFIRA requires that the Enterprises each implement procedures reasonably designed to ensure that any mortgage loan that is purchased and is secured by property located in a designated flood hazard area is covered for the term of the loan by flood insurance in an amount at least equal to the lesser of (1) the outstanding principal balance of the loan or (2) the maximum limit of coverage made available for that type of property under the NFIP. OFHEO is authorized under NFIRA to levy a civil money penalty for each violation, not to exceed an aggregate maximum amount per year, 10 against an Enterprise that it finds to have engaged in a pattern or practice of purchasing loans in violation of the procedures established pursuant to NFIRA. 11

OFHEO published a notice of proposed rulemaking (66 FR 47563, September 12, 2001) for public comment relating to its flood insurance oversight responsibilities. Comments on the proposed regulation were received only from the two Enterprises. Those comments were carefully considered in developing this final regulation. A discussion of those comments and OFHEO's response to them follows.

The Enterprises have a key role in the implementation of the National Flood Insurance Program, particularly with regard to lenders that are not subject to direct supervision by a Federal regulatory agency. The Enterprises use their seller/servicer guidelines and other quality control review procedures to ensure that lenders with whom they contract comply with the applicable flood insurance laws. The Enterprises are required to establish procedures designed to prevent their purchase of loans that do not comply with these laws. NFIRA tasks OFHEO with reviewing the adequacy of such procedures as well as the Enterprises' compliance with them.

A primary purpose of the final regulation is to reiterate the relevant statutory provisions specifically applicable to the Enterprises and to OFHEO and to codify them in OFHEO's regulations. The final regulation is intended to provide guidance as to the procedures to be applied if an enforcement action were to be required, to add statutory civil money penalty amounts for infractions of the flood insurance requirements to the schedule of penalties in OFHEO's regulations and to adjust such penalty amounts as contemplated by law for inflation.

The Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Debt Collection Improvement Act of 1996 (the Inflation Adjustment Act), 12 requires Federal agencies with the authority to issue civil money penalties, to adopt regulations to adjust each civil money penalty authorized by law that the agency has jurisdiction to administer. The purpose of these adjustments is to maintain the deterrent effect of civil money penalties and promote compliance with the law. The Inflation Adjustment Act requires agencies to make an initial adjustment of their civil money penalties upon the statute's enactment, and to make additional adjustments on an ongoing basis, at least once every four years following the initial adjustment.

This amendment adopts a new AD for Sikorsky Model S-70A and S-70C helicopters. This action requires certain inspections of each beam for a crack and removing any cracked beam before further flight. This AD also requires reducing the torque of the nut on each beam. This amendment is prompted by the failure of a beam due to stress corrosion resulting from sustained tensile stress due partly to excessive torque on the nut.

The FAA has reviewed Sikorsky Alert Service Bulletin No. 70-03-2, dated July 26, 1999 (ASB). The ASB describes procedures for reducing the torque on each nut to 45-50 ft-lbs to reduce stress to the beam.

We have identified an unsafe condition that is likely to exist or develop on other Sikorsky Model S-70A and S-70C helicopters of the same type designs. Therefore, this AD is being issued to prevent excessive torque on a nut, failure of a beam, and subsequent loss of control of the helicopter during takeoff or landing. The short compliance time involved is required because the previously described critical unsafe condition can adversely affect the controllability and structural integrity of the helicopter. Therefore, within 30 hours time-in-service, the following actions are required for the beam, and this AD must be issued immediately:

• Visually inspect each beam for a crack.

• If a crack is found, remove the beam before further flight.

• If a crack is suspected, dye-penetrant inspect the beam, and if a crack is found, remove the beam before further flight.

• If no crack is found, reduce the torque on the nut.

Since a situation exists that requires the immediate adoption of this regulation, it is found that notice and opportunity for prior public comment hereon are impracticable, and that good cause exists for making this amendment effective in less than 30 days.

The FAA estimates that 3 helicopters on the U.S. register will be affected by this AD, that it will take approximately 2 work hours to inspect the beam and to reduce the torque on each nut, and 2 work hours to replace a cracked beam. The average labor rate is $60 per work hour. Required parts will cost approximately $18,600 per beam. Based on these figures, the total cost impact of the AD on U.S. operators is estimated to be $56,520, assuming one beam has to be replaced on each affected helicopter.

Although this action is in the form of a final rule that involves requirements affecting flight safety and, thus, was not preceded by notice and an opportunity for public comment, comments are invited on this rule. Interested persons are invited to comment on this rule by submitting such written data, views, or arguments as they may desire. Communications should identify the Rules Docket number and be submitted in triplicate to the address specified under the caption ADDRESSES. All communications received on or before the closing date for comments will be considered, and this rule may be amended in light of the comments received. Factual information that supports the commenter's ideas and suggestions is extremely helpful in evaluating the effectiveness of the AD action and determining whether additional rulemaking action would be needed.

Comments are specifically invited on the overall regulatory, economic, environmental, and energy aspects of the rule that might suggest a need to modify the rule. All comments submitted will be available in the Rules Docket for examination by interested persons. A report that summarizes each FAA-public contact concerned with the substance of this AD will be filed in the Rules Docket.

Commenters wishing the FAA to acknowledge receipt of their mailed comments submitted in response to this rule must submit a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. 2001-SW-18-AD.” The postcard will be date stamped and returned to the commenter.

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.

The FAA has determined that this regulation is an emergency regulation that must be issued immediately to correct an unsafe condition in aircraft, and that it is not a “significant regulatory action” under Executive Order 12866. It has been determined further that this action involves an emergency regulation under DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979). If it is determined that this emergency regulation otherwise would be significant under DOT Regulatory Policies and Procedures, a final regulatory evaluation will be prepared and placed in the Rules Docket. A copy of it, if filed, may be obtained from the Rules Docket at the location provided under the caption ADDRESSES.

On August 25, 2000 we published a notice of proposed rulemaking entitled Drawbridge Operation Regulations; Longboat Pass and New Pass, Longboat Key, FL, in the Federal Register (65 FR 51787). On December 7, 2000 we published a notice of proposed rulemaking reopening the comment period for an additional 60 days, entitled Drawbridge Operation Regulations; Longboat Pass and New Pass, Longboat Key, FL, in the Federal Register (65 FR 76956).

Based on the increased vessel traffic through Longboat Pass Bridge and the decreased vessel traffic through New Pass Bridge, the Coast Guard is changing the operating regulations for these two Bridges to provide a safer and more efficient transit for vehicles and vessels near Longboat Key. The current regulation governing Longboat Pass Bridge (SR 789), mile 0.0, between Longboat Key and Anna Maria Key, codified in 33 CFR 117.299 states that the draw shall open on signal, except that from 6 p.m. to 6 a.m., the draw will open on signal if at least 3 hours notice is given. This rule removes the operating regulations in 33 CFR 117.299 and requires the draw to open on signal in accordance with the general bridge operation provision in 33 CFR 117.5.

Due to the number of comments from motor vehicle drivers concerning the proposed New Pass Bridge regulation, we are keeping the existing part of the regulation in 33 CFR 117.311 which states that the Bridge shall open on signal except from 7 a.m. to 6 p.m. the draw need open only on the hour, twenty minutes past the hour and forty minutes past the hour. The change to the rule allows the Bridge to open on signal between 6 p.m. and 7 a.m. if at least 3 hours of notice is given to the bridge tender.

Public vessels of the United States, tugs with tows and vessels in a situation where a delay would endanger life or property will, upon proper signal, be passed through both bridges at any time.

The Coast Guard received seventy-three comment letters addressing the notice of proposed rulemaking. Sixty-one of the letters disagreed with the proposed rule changes. The comments indicated that the proposed changes would create a burden for vehicular traffic. The collected data indicates that the New Pass Bridge currently opens approximately 3 to 4 times per day, due to the extreme hazards involved with transiting through New Pass to the Gulf of Mexico. As a result of these conditions, vessel traffic through New Pass at night is sparse. To alleviate the concerns expressed in these comments, we decided to keep the current regulations in 33 CFR 117.311 governing the New Pass Bridge and add to the regulation a provision that the bridge will open on signal from 6 p.m. to 7 a.m. if at least 3 hours notice is given to the bridge tender.

Eighteen of these comments also requested a new daytime rule on the Longboat Pass Bridge. We forwarded these comments to the Bridge owner/operator, Florida Department of Transportation, to research and address the feasibility of a new daytime rule.

Twelve comments agreed with the rule change. The comment letters, all from the boating public, acknowledged the navigational hazards at New Pass including the difficulties involved in nighttime access into and out of the Gulf of Mexico. The comments indicated the preferred route into and out of the Gulf of Mexico has changed over the years from New Pass to Longboat Pass. The current collected data corroborates these comments by showing a decrease in vessel traffic at New Pass and the increase in vessel traffic at Longboat Pass. We are adopting, without change, the proposal placing the Longboat Pass Bridge on a twenty-four hour, open on signal, operation schedule.

This rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866, Regulatory Planning and Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. It is not “significant” under the regulatory policies and procedures of the Department of Transportation (DOT) (44 FR 11040, February 26, 1979).

The Coast Guard expects the economic impact of this proposed rule to be so minimal that a full Regulatory Evaluation under paragraph 10e of the regulatory policies and procedures of DOT is unnecessary because the rule allows the Longboat Pass Bridge to open on signal and will only slightly modify the existing operating schedule for the New Pass Bridge.

Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we considered whether this rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000.

This rule may affect the following entities, some of which might be small entities: the owners or operators of vessels intending to transit under the Longboat Pass and New Pass Bridges. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule would not have a significant economic impact on a substantial number of small entities because the rule allows the Longboat Pass Bridge to open on signal and will only slightly modify the existing operating schedule for the New Pass Bridge.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Public Law 104-121), we offered to assist small entities in understanding the rule so that they could better evaluate its effects on them and participate in the rulemaking process. If the rule will affect your small business, organization, or government jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed under FOR FURTHER INFORMATION CONTACT for assistance in understanding this rule.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247).

This rule calls for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this rule under that Order and have determined that it does not have implications for federalism.

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

This rule will not effect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

We have analyzed this rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not create an environmental risk to health or risk to safety that may disproportionately affect children.

The Coast Guard has considered the environmental impact of this action and has determined under Figure 2-1, paragraph 32(e) of Commandant Instruction M16475.1D, that this rule is categorically excluded from further environmental documentation.

This rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

We have analyzed this rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. It has not been designated by the Administrator of the Office of Information and Regulatory Affairs as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.

We did not publish a notice of proposed rulemaking (NPRM) for this regulation. Under 5 U.S.C 553(b)(B), the Coast Guard finds that good cause exists for not publishing an NPRM. On September 11, 2001, terrorist attacks in New York and Washington DC inflicted catastrophic human casualties and property damage. National security and intelligence officials warn that future terrorist attacks against civilian targets may be anticipated. The Maine Yankee Nuclear Plant is located on a peninsula, surrounded by water, exposing it to possible attack initiated from waters surrounding the power plant. Due to the catastrophic effect an exposure to radiation from the nuclear material stored at the plant would have on the surrounding area, this rulemaking is urgently required to prevent potential future terrorist strikes against the Maine Yankee Nuclear Power Plant. The delay inherent in the NPRM process is contrary to the public interest insofar as it may render people and facilities within and adjacent to the Maine Yankee Nuclear Power Plant property vulnerable to subversive activity, sabotage or terrorist attack.

Under 5 U.S.C. 553 (d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register . The measures implemented in this rule are intended to prevent possible terrorists attacks against the Maine Yankee Nuclear Power Plant, and are needed to protect the facility, persons at the facility, the public and the surrounding communities from potential sabotage or other subversive activity, sabotage and terrorists attacks, either from the water or by access to the facility by utilizing public trust lands between the low and high water tide lines. Immediate action is required to accomplish these objectives. Any delay in the effective date of this rule is impracticable and contrary to the public interest. This zone should have minimal impact on the users of Bailey Point, Foxbird Island and the surrounding waters, as this zone only restricts movement adjacent to the Bailey Point, allowing vessels to pass safely outside the zones. Public notifications will be made to the maritime community via notice to mariners, marine information broadcasts and signs posted informing them of the boundaries of the zones.

In light of terrorist attacks on New York City and Washington DC on September 11, 2001 a security zone is being established to safeguard the Maine Yankee Nuclear Power Plant, persons at the facility, the public and surrounding communities from sabotage or other subversive acts, accidents, or other events of a similar nature. The Maine Yankee Nuclear Plant is located on a peninsula, surrounded by water, making it vulnerable to possible attack initiated from waters surrounding the power plant. The Maine Yankee Nuclear Power Plant presents a possible target of terrorist attack due to the catastrophic impact release of nuclear radiation would have on the surrounding area.

This rulemaking establishes a security zone in all land and waters surrounding Bailey Point and Foxbird Island within a zone beginning at position 43°57′23″ N, 069°41′17″ W then running southeasterly to 43°56′40″ N, 069°41′40″ W then running west to 43°56′40″ N, 069°41′56″ W then running north to 43°57′06″ N, 069°41′56″ W then running north-northeasterly to 43°57′21″ N, 069°41′48″ W then running north-northwesterly to 43°57′39″ N, 069°41′52″ W then south-southeasterly to the point of origin.

This rulemaking is necessary to provide complete protection of the waterfront areas of the Maine Yankee Nuclear Power Plant. This security zone prohibits entry into or movement within the specified areas. This security zone also closes all lands within the zone to prevent access along areas traditionally reserved for public use between the mean low water tide line and the mean high water tide line.

No person or vessel may enter or remain in the prescribed security zone at any time without the permission of the Captain of the Port, Portland, Maine. Each person or vessel in a security zone shall obey any direction or order of the Captain of the Port, Portland, Maine. The Captain of the Port, Portland, Maine may take possession and control of any vessel in a security zone and/or remove any person, vessel, article or thing from a security zone. No person may board, take or place any article or thing on board any vessel or waterfront facility in a security zone without permission of the Captain of the Port, Portland, Maine. These regulations are issued under authority contained in 33 U.S.C. 1223, 1225 and 1226.

This temporary final rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866 and does not require an assessment of potential costs and benefits under section 6(a)(3) of that order. The Office of Management and Budget has not reviewed it under that Order. It is not significant under the regulatory policies and procedures of the Department of Transportation (DOT) (44 FR 11040; February 26, 1979).

The Coast Guard expects the economic impact of this proposal to be so minimal that a full Regulatory Evaluation under paragraph 10e of the regulatory policies and procedures of DOT is unnecessary. The effect of this regulation will not be significant for several reasons: there is ample room for vessels to navigate around the zones in the Back River, notifications will be made to the local maritime community and signs will be posted informing the public of the boundaries of the zone.

Under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.), the Coast Guard considered whether this rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605 (b) that this rule will not have a significant economic impact on a substantial number of small entities. This rule will affect the following entities, some of which may be small entities: the owners or operators of vessels intending to transit or anchor in a portion of the Back River. For the reasons enumerated in the Regulatory Evaluation section above, this security zone will not have a significant economic impact on a substantial number of small entities.

Under subsection 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), the Coast Guard offers to assist small entities in understanding this rule so that they can better evaluate its effects on them and participate in the rulemaking. If your small business or organization is affected by this final rule and you have questions concerning its provisions or options for compliance, please call Lieutenant (Junior Grade) Wade W. Gough, Marine Safety Office Portland, Maine, at (207) 780-3251. Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of Coast Guard, call 1-888-REG-FAIR (1-888-734-3247).

This rule calls for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

The Coast Guard has analyzed this rule under Executive Order 13132 and has determined that this rule does not have implications for federalism under that Order.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) governs the issuance of Federal regulations that require unfunded mandates. An Unfunded Mandate is a regulation that requires a state, local or tribal government or the private sector to incur costs without the Federal government's having first provided the funds to pay those costs. This rule will not impose an unfunded mandate.

This rule will not effect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This rule meets applicable standards in section 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity and reduce burden.

The Coast Guard has analyzed this rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not create an environmental risk to health or risk to safety that may disproportionately affect children.

This rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

The Coast Guard has considered the environmental impact of this regulation and concluded that, under Figure 2-1, paragraph 34(g) of Commandant Instruction M16475.1D, this rule is categorically excluded from further environmental documentation. A “Categorical Exclusion Determination” is available in the docket where indicated under ADDRESSES.

We have analyzed this rule under Executive Order 13211, Actions Concerning Regulations that Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. It has not been designated by the Administrator of the Office of Information and Regulatory Affairs as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.

The modified base flood elevations are not listed for each community in this interim rule. However, the address of the Chief Executive Officer of the community where the modified base flood elevation determinations are available for inspection is provided.

Any request for reconsideration must be based upon knowledge of changed conditions, or upon new scientific or technical data.

The modifications are made pursuant to section 201 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4105, and are in accordance with the National Flood Insurance Act of 1968, 42 U.S.C. 4001 et seq. , and with 44 CFR part 65.

For rating purposes, the currently effective community number is shown and must be used for all new policies and renewals.

The modified base flood elevations are the basis for the floodplain management measures that the community is required to either adopt or to show evidence of being already in effect in order to qualify or to remain qualified for participation in the National Flood Insurance Program (NFIP).

These modified elevations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own, or pursuant to policies established by other Federal, state or regional entities.

The changes in base flood elevations are in accordance with 44 CFR 65.4.

This rule is categorically excluded from the requirements of 44 CFR part 10, Environmental Consideration. No environmental impact assessment has been prepared.

The Acting Administrator, Federal Insurance and Mitigation Administration, certifies that this rule is exempt from the requirements of the Regulatory Flexibility Act because modified base flood elevations are required by the Flood Disaster Protection Act of 1973, 42 U.S.C. 4105, and are required to maintain community eligibility in the National Flood Insurance Program. No regulatory flexibility analysis has been prepared.

This interim rule is not a significant regulatory action under the criteria of section 3(f) of Executive Order 12866 of September 30, 1993, Regulatory Planning and Review, 58 FR 51735.

This rule involves no policies that have federalism implications under Executive Order 12612, Federalism, dated October 26, 1987.

This rule meets the applicable standards of section 2(b)(2) of Executive Order 12778.

The Federal Emergency Management Agency makes the final determinations listed below of modified base flood elevations for each community listed. These modified elevations have been published in newspapers of local circulation and ninety (90) days have elapsed since that publication. The Acting Administrator has resolved any appeals resulting from this notification.

The modified base flood elevations are not listed for each community in this notice. However, this rule includes the address of the Chief Executive Officer of the community where the modified base flood elevation determinations are available for inspection.

The modifications are made pursuant to section 206 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4105, and are in accordance with the National Flood Insurance Act of 1968, 42 U.S.C. 4001 et seq. , and with 44 CFR part 65.

For rating purposes, the currently effective community number is shown and must be used for all new policies and renewals.

The modified base flood elevations are the basis for the floodplain management measures that the community is required to either adopt or to show evidence of being already in effect in order to qualify or to remain qualified for participation in the National Flood Insurance Program (NFIP).

These modified elevations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own, or pursuant to policies established by other Federal, state or regional entities.

These modified elevations are used to meet the floodplain management requirements of the NFIP and are also used to calculate the appropriate flood insurance premium rates for new buildings built after these elevations are made final, and for the contents in these buildings.

The changes in base flood elevations are in accordance with 44 CFR 65.4.

This rule is categorically excluded from the requirements of 44 CFR part 10, Environmental Consideration. No environmental impact assessment has been prepared.

The Acting Administrator, Federal Insurance and Mitigation Administration, certifies that this rule is exempt from the requirements of the Regulatory Flexibility Act because modified base flood elevations are required by the Flood Disaster Protection Act of 1973, 42 U.S.C. 4105, and are required to maintain community eligibility in the NFIP. No regulatory flexibility analysis has been prepared.

This final rule is not a significant regulatory action under the criteria of section 3(f) of Executive Order 12866 of September 30, 1993, Regulatory Planning and Review, 58 FR 51735.

This rule involves no policies that have federalism implications under Executive Order 12612, Federalism, dated October 26, 1987.

This rule meets the applicable standards of section 2(b)(2) of Executive Order 12778.

The Federal Emergency Management Agency (FEMA or Agency) makes final determinations listed below of base flood elevations and modified base flood elevations for each community listed. The proposed base flood elevations and proposed modified base flood elevations were published in newspapers of local circulation and an opportunity for the community or individuals to appeal the proposed determinations to or through the community was provided for a period of ninety (90) days. The proposed base flood elevations and proposed modified base flood elevations were also published in the Federal Register .

This final rule is issued in accordance with section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and 44 CFR part 67.

The Agency has developed criteria for floodplain management in floodprone areas in accordance with 44 CFR part 60.

Interested lessees and owners of real property are encouraged to review the proof Flood Insurance Study and Flood Insurance Rate Map available at the address cited below for each community.

The base flood elevations and modified base flood elevations are made final in the communities listed below. Elevations at selected locations in each community are shown.

This rule is categorically excluded from the requirements of 44 CFR part 10, Environmental Consideration. No environmental impact assessment has been prepared.

The Acting Administrator, Federal Insurance and Mitigation Administration, certifies that this rule is exempt from the requirements of the Regulatory Flexibility Act because final or modified base flood elevations are required by the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and are required to establish and maintain community eligibility in the NFIP. No regulatory flexibility analysis has been prepared.

This final rule is not a significant regulatory action under the criteria of Section 3(f) of Executive Order 12866 of September 30, 1993, Regulatory Planning and Review, 58 FR 51735.

This rule involves no policies that have federalism implications under Executive Order 12612, Federalism, dated October 26, 1987.

This rule meets the applicable standards of Section 2(b)(2) of Executive Order 12778.

FEMA makes the final determinations listed below of BFEs and modified BFEs for each community listed. The proposed BFEs and proposed modified BFEs were published in newspapers of local circulation and an opportunity for the community or individuals to appeal the proposed determinations to or through the community was provided for a period of ninety (90) days. The proposed BFEs and proposed modified BFEs were also published in the Federal Register .

This final rule is issued in accordance with section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and 44 CFR part 67.

FEMA has developed criteria for floodplain management in floodprone areas in accordance with 44 CFR part 60.

Interested lessees and owners of real property are encouraged to review the proof Flood Insurance Study and FIRM available at the address cited below for each community.

The BFEs and modified BFEs are made final in the communities listed below. Elevations at selected locations in each community are shown.

This rule is categorically excluded from the requirements of 44 CFR part 10, Environmental Consideration. No environmental impact assessment has been prepared.

The Acting Administrator, Federal Insurance and Mitigation Administration certifies that this rule is exempt from the requirements of the Regulatory Flexibility Act because final or modified BFEs are required by the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and are required to establish and maintain community eligibility in the NFIP. No regulatory flexibility analysis has been prepared.

This final rule is not a significant regulatory action under the criteria of section 3(f) of Executive Order 12866 of September 30, 1993, Regulatory Planning and Review, 58 FR 51735.

This rule involves no policies that have federalism implications under Executive Order 12612, Federalism, dated October 26, 1987.

This proposed rule meets the applicable standards of section 2(b)(2) of Executive Order 12778.

This is a summary of the Commission's Memorandum Opinion and Order on Reconsideration (MO&O), FCC 01-330, adopted November 8, 2001, released November 15, 2001. The full text of the Commission's MO&O is available for inspection and copying during normal business hours in the FCC Dockets Branch (Room TW-A306), 445 12th Street, SW., Washington, DC 20554. The complete text of this MO&O may also be purchased from the Commission's copy contractor, Qualex International, (202) 863-2893, 445 12th Street, SW., Room CY-B402, Washington, DC 20554. The text of the MO&O is also available from the FCC's Internet website: www.fcc.gov.

This MO&O contains either a new or modified information collection. It will be submitted to the Office of Management and Budget (OMB) for review under Section 3507(d) of the PRA. The Commission, as part of its continuing effort to reduce paperwork burdens, invites the general public and other government agencies to comment on the information collection contained in this MO&O as required by the Paperwork Reduction Act of 1995, Public Law 104-13. Public and agency comments are due February 19, 2002. Comments should address: (a) Whether the new or modified collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; (b) the accuracy of the Commission's burden estimates; (c) ways to enhance the quality, utility, and clarity of the information collected; and (d) ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology.

OMB Control Number: 3060-XXXX.

Title: Application for Extension of Time to Construct a Digital Television Broadcast Station.

Form No.: FCC 337.

Type of Review: New collection.

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

Number of Respondents: 600 (400 extensions; 200 requests for special temporary authority).

Estimated Time per Response: 1.5 hours extensions (0.5 hours respondent; 1 hour attorney); 4.0 hours. STA (1 hour respondent; 1 hour attorney; 2 hours consulting engineer).

Total Annual Burden: 400 hours.

Total Annual Costs: $207,000.

Needs and Uses: The MO&O revises the circumstances under which an extension of time to construct a digital television broadcast station can be requested. The Commission has developed the FCC 337 to be used by DTV permittees to apply for an extension of time. Applicants must retain documentation fully detailing and supporting their representations made on this form. In addition, the MO&O adopted a provision for special temporary authority for licensees that have not been granted a construction permit for allotted or maximized DTV facilities to commence digital operations. The request for special temporary authority must specify the technical facilities requested. The data is used by FCC staff to determine, on a case-by-case basis, whether a broadcaster should be afforded additional time to construct its facilities and to ensure that operation will not exceed allotted parameters.

1. In this MO&O, we revise a number of the determinations we made in the R&O, affirm other decisions, and provide clarification of certain rules and policies. We also modify, on our own motion, the minimum hours of operation of certain DTV stations and establish guidelines for television stations that may seek an extension of our deadlines for construction of DTV facilities. We will resolve several major technical issues raised in the R&O, including the issues of receiver performance standards, DTV tuners, revisions to the ATSC transmission standard (including the PSIP standard), and labeling requirements for television receivers, in a separate R&O.

2. In the Commission's digital television proceeding (MM Docket No. 87-268), we indicated our intention to hold periodic reviews of the progress of the conversion to digital television and to make any mid-course corrections necessary to ensure the success of that conversion. In the Fifth Report and Order in MM Docket 87-268 (63 FR 135461, May 20, 1998) (Fifth R&O), we stated that we would conduct such a review every two years in order to “ensure that the introduction of digital television and the recovery of spectrum at the end of the transition fully serves the public interest.” We commenced this first periodic review with a Notice of Proposed Rule Making in MM Docket 00-39 (65 FR 15600, March 23, 2000) (NPRM), adopted March 6, 2000. In the NPRM, we invited comment on a number of issues that we considered essential to resolve in order to ensure continued progress on the conversion. We also sought comment generally on various aspects of the transition, such as the pace of DTV receiver sales and the availability of financing for digital facilities.

3. Based on the comments we received in response to the NPRM, we made a number of determinations in the R&O that we believed would further progress on the transition. Among other things, we established a December 31, 2003 deadline by which commercial television stations that have both their NTSC and DTV operations on in-core channels must elect which of their two core channels to use for DTV operations after the transition. We gave non-commercial stations that have both their NTSC and DTV operations on in-core channels until the end of 2004 to elect their post-transition DTV channel. We determined that this early channel election would allow us to identify more quickly channels that will be available to accommodate DTV licensees with out-of-core transition channels as well as new entrants. In addition, to provide broadcasters with an incentive to provide full replication of NTSC coverage with DTV service, we determined that, after December 31, 2004, whatever portion of a commercial broadcaster's NTSC Grade B contour is not replicated with its digital television signal will cease to be protected in the DTV Table of Allotments. Noncommercial DTV licensees were given until December 31, 2005 in which to replicate or lose such DTV interference protection. We also imposed a principal community coverage requirement that is stronger than the DTV service contour requirement that we adopted as an initial obligation in the Fifth R&O. This new city-grade service requirement, which becomes effective December 31, 2004 for commercial stations and December 31, 2005 for noncommercial stations, was intended to improve the availability of service in the community of license and to prevent undue migration of stations from their communities of license.

4. In addition, in our R&O we adopted DTV application cut-off procedures and determined how we would resolve any mutually exclusive applications. We also made a number of technical decisions, including our determination that there is no persuasive information to indicate that there is any deficiency in the 8-VSB modulation system of the DTV transmission standard that would warrant adding COFDM to the current standard. Finally, we declined to adopt technical performance standards for DTV receivers, although we indicated we would continue to monitor receiver issues throughout the transition and would take appropriate action on receiver standards if necessary.

5. Upon further consideration, and after careful review of the petitions for reconsideration, we believe that some of the requirements that we adopted in the R&O may be having the unintended consequence of hindering, rather than furthering, the DTV transition. In particular, we believe that the Commission's current channel election and replication requirements and deadlines may be imposing substantial burdens on broadcasters without sufficient countervailing public benefits, and may in fact be contributing to difficulties faced by a substantial number of stations in meeting their DTV construction deadlines.

6. The DTV build-out dates have passed for the top-30-market major network affiliate stations. As of September 2001, thirty-seven of the 40 major network affiliate stations in the top 10 television markets are on the air with DTV service, 36 with licensed facilities and one with special temporary authority (“STA”). In addition, 71 of the 79 major network affiliate stations in markets 11-30 are providing digital service, 61 with licensed facilities and 10 with STAs. By May 1, 2002, all remaining commercial television stations are required to complete construction and commence DTV operations. Noncommercial stations have until May 1, 2003 to complete construction.

7. The National Association of Broadcasters (NAB) recently conducted a survey of all full-power commercial TV stations to determine how many anticipate they will have a digital signal on the air by May 2002. The results of the survey show that more than two thirds (68.2%) of responding stations reported that they either are operating now in digital format or expect to have a digital signal on the air by May 2002. Stations that anticipate meeting the deadline would provide at least one digital signal by next May in 164 television markets. According to the NAB, these markets include 95.8 % of all television households.

8. While these survey results are encouraging, it nonetheless appears that slightly less than one-third (31.8%) of all stations responding to the NAB survey anticipate that they will not be able to provide a digital signal by the May 2002 deadline. A larger percentage (81.9%) of responding stations in the top 50 markets anticipate that they will meet the deadline, while a smaller percentage (49.1%) of stations in markets 100 and above indicated they will complete construction on time. Three-quarters of those stations that do not anticipate meeting the May 2002 deadline indicated they plan to seek an extension of this deadline from the FCC. Generally, smaller market broadcasters that filed petitions in this proceeding assert that they are unable to obtain financing to construct DTV facilities sufficient to replicate their analog service area. These broadcasters also claim that they will not have sufficient operational experience by December 2004 to determine which core channel is superior for DTV transmission. Broadcasters that are not capable of constructing full replication facilities by the deadline established in the R&O may be postponing construction altogether. Thus, while the Commission's current replication deadline was intended to provide an incentive to stations to construct DTV facilities capable of reaching their entire service area, this deadline may in fact be causing stations to delay construction, thus slowing transition progress.

9. As discussed more fully below, upon reconsideration we have decided to allow stations to construct initial DTV facilities designed to serve at least their communities of license, while still retaining DTV interference protection to provide full replication at a later date. Thus, we will temporarily defer the replication protection and channel election deadlines we established in the R&O. In our next periodic review of the progress of the DTV transition, we intend to establish a firm date by which broadcasters must either replicate their NTSC service areas or lose DTV service protection of the unreplicated areas, and by which broadcasters with two in-core allotments must elect which channel they will eventually use at the end of the transition. These replication protection and channel election deadlines may be earlier than but will in no event be later than the latest of either the end of 2006 or the date by which 85% of the television households in a licensee's market are capable of receiving the signals of digital broadcast stations. During the next periodic review, we intend to develop a record on the progress of the transition and how such progress relates to such issues as band clearing and the goal of the rapid recovery of spectrum for public safety and other wireless services, as well as other issues related to the successful conclusion of the DTV transition. In order to provide parity to analog UHF stations, we will also allow these stations to construct initial facilities that serve their principal communities while retaining for the time being DTV interference protection to their maximized service areas, subject to the interference protection deadline we intend to establish in the next periodic review. We will not alter, however, our decision to require stations to provide a stronger signal to their communities of license than that adopted as an initial requirement in the Fifth R&O. As established in the R&O, this new city-grade service requirement will become effective December 31, 2004 for commercial stations and December 31, 2005 for noncommercial stations.

10. Our intention in making these revisions to the decisions reached in the R&O is to prioritize those elements that are most important to the DTV transition. At this point, we believe our primary goal should be to maximize the number of DTV stations providing service to at least all consumers in their community of license. Relaxing our channel election and replication requirements will allow stations to go on the air with lower-powered, and therefore less expensive, facilities, while also providing broadcasters additional time to consider their post-transition facilities. The reduced build-out requirements we adopt today will allow broadcasters to save both on construction and operating costs, including lower power expenses. Indeed, the ability to transmit at lower power may permit many of these stations to transmit from existing towers, rather than being forced to build new facilities immediately. In addition, we will allow DTV stations that are not yet required to be on the air with a digital signal— i.e., those that are subject to the May 1, 2002 or May 1, 2003 deadlines, including stations subject to those deadlines that are currently on the air early—to operate initially at a reduced schedule by providing, at a minimum, a digital signal during prime time hours, consistent with their simulcast obligations. This is consistent with our recognition that such stations, as an initial matter, may need the flexibility to adopt a more graduated approach to the transition. We believe that this approach may permit more stations to meet the build-out deadlines and help advance the digital transition. This minimum will effectively be increased under the Commission's existing simulcast obligations, which require DTV licensees to simulcast 50% of their analog schedule by April 1, 2003, 75% of their analog schedule by April 2004, and 100% of their analog schedule by April 2005. Stations that were subject to the earlier construction deadlines (top four network affiliates in the top thirty markets) will remain subject to the previous rule— i.e., they must operate their DTV station at any time that the analog station is operating. This distinction is consistent with our prior treatment of these stations. In establishing earlier build-out deadlines for these stations in the Fifth R&O, we noted that “the most viewed stations in the largest television markets can be expected to lead the transition to DTV” and that these stations are “likely to have substantial revenues that may be used to fund the conversion.”

11. In the end, we believe that reconsidering these rules will help further the DTV transition while actually promoting the goals of replication and of maximizing the digital service provided to the public. Getting more stations on the air will help drive DTV set penetration. Increasing the number of DTV sets in production and in the hands of consumers will bring prices down and provide an incentive for content producers and advertisers to invest in DTV. Ultimately, an expanding DTV marketplace will help further the expansion of DTV into unserved areas in the future.

12. After the transition, DTV service will be limited to a “core spectrum” consisting of current television channels 2 through 51. Although some stations received transition channels out of the core, and a few have both their NTSC and DTV channels outside the core, we believe that there will be sufficient spectrum so that at the end of the transition all DTV stations will be operating on core channels. However, as we indicated in the R&O, it now appears that there will be more out of core stations that must be accommodated with a core channel than we initially anticipated because new applicants will be allowed to convert their single NTSC channels to DTV operation and those on NTSC and DTV channels outside the core will be provided a post-transition channel inside the core. Also, the recent establishment of primary Class A television stations may limit availability of core channels in some areas.

13. These factors influenced our decision in the R&O to mandate early election of DTV channels for that category of licensees with both their NTSC and DTV channels within the core. Specifically, we gave commercial television licensees with both their NTSC and DTV operations on in-core channels until December 31, 2003 to decide which of their two in-core channels to use for DTV operations after the transition. We noted that this is more than one and a half years after the last commercial station construction deadline ( i.e., May 1, 2002), and stated our belief that this gave stations time in which to decide which of their two in-core channels would be most suitable for use in digital broadcasting. We stated that setting this channel election deadline would enable us to determine at an early date, on a market-by-market basis, what in-core channels would be available for use by stations having two out-of-core channels. We also stated our belief that an early final channel election would help speed the transition by making the final local channel alignments clear. We gave non-commercial stations that have both their NTSC and DTV operations on in-core channels until the end of 2004 to elect their channels, or more than one and a half years after their construction deadline ( i.e., May 1, 2003).

14. As we indicated above, upon reconsideration we have determined to temporarily defer the imposition of a channel election deadline until the next periodic review. We intend to monitor closely the progress of the transition and, based on developments between now and the conclusion of the next review, we will establish a channel election deadline that may be earlier than but in no event will be later than the latest of either the end of 2006 or the date by which a market meets the 85% digital penetration target. We believe that this action is consistent with, and necessitated by, our decision today to allow stations to construct initial DTV facilities designed to serve their communities of license, while still preserving DTV interference protection to provide full replication or maximization service at a later date.

15. We expect that a number of stations will choose to meet our May 2002 construction deadline by building less than full facilities initially, or by operating at lower power, and increasing power over time in relation to the demand for digital programming. We are today permitting stations to commence service with facilities that meet the minimum requirements set forth in § 73.625(a)(1) of our rules. By December 31, 2004, commercial stations must meet the increased city-grade signal strength requirements we imposed in the R&O. Noncommercial stations have until December 31, 2005 to meet this city-grade service obligation. At the same time, on our own motion, we will allow television stations subject to the May 1, 2002 and May 1, 2003 DTV construction deadlines to operate digitally at a reduced schedule by providing, at a minimum, a digital signal during prime time as specified in § 79.3(a)(6) of our rules. With respect to these stations, this replaces our current rule that requires that DTV licensees and permittees transmit at least one DTV signal at any time the licensee or permittee transmits an analog signal. This modified rule does not reduce the simulcast obligations of these licensees, described in § 73.624(f) of our rules. Thus, for example, by April 1, 2003, a DTV station that was required to be on the air by May 1, 2002 must provide a digital signal at least 50 percent of the time it transmits an analog signal, and under the requirements of § 73.624(b)(i), a portion of the simulcasting must occur during prime time.

16. We believe that permitting stations to elect a more graduated approach to providing DTV service will foster the early introduction of DTV service to core service areas, and allow stations to grow into their full DTV facilities as the transition progresses. Because we are permitting stations greater flexibility to increase digital power and hours of service over time, we believe stations must be given an opportunity to increase power and gain experience at those higher power levels before they can make an educated choice about which of their two channels will provide optimal DTV service. We believe that this concern outweighs the benefits we discussed in the R&O that would result from an early election date. Accordingly, we will temporarily defer the imposition of an election deadline until the next periodic review.

17. We established NTSC service replication as a goal in the creation of the initial DTV Table of Allotments. Each DTV channel allotment was chosen to best allow its DTV service to match the Grade B service contour of the NTSC station with which it was paired. As we stated in the R&O, we continue to believe that this approach provides important benefits to both viewers and broadcasters and “will ensure that broadcasters have the ability to reach the audiences that they now serve and that viewers have access to the stations that they can now receive over-the-air.”

18. In the R&O, we stated our expectation that DTV broadcasters would eventually choose to replicate their NTSC service areas to serve their viewers. However, we concluded we would not require replication because we wanted to give broadcasters a measure of flexibility as they build their DTV facilities to collocate their antennas at common sites, thus minimizing potential local difficulties locating towers and eliminating the cost of building new towers. We also recognized, among other things, that, in the absence of a Commission-mandated replication requirement and because we provided licensees a certain amount of transmitter location flexibility, some licensees may have already built their initial DTV facilities in locations that are unsuitable for full replication.

19. While we concluded we would not expressly require full replication of NTSC coverage with DTV service, we determined we would provide an incentive to broadcasters to provide such replication in order to assure that viewers do not lose service and to speed the transition. Specifically, we decided to cease to give DTV interference protection to commercial broadcasters' unreplicated service areas as of December 31, 2004. Thus, under the decision we reached in the R&O, commercial broadcasters that did not replicate their NTSC Grade B service area as of that date left the unreplicated portions of their DTV service area unprotected in the DTV Table of Allotments against other DTV broadcasters seeking to maximize their own service areas or analog full or low-power broadcasters, including Class A licensees, seeking to expand the service area of their existing stations. We gave noncommercial DTV licensees until December 31, 2005 to replicate or lose interference protection.

20. As we indicated above, upon reconsideration we have decided to temporarily defer until the next periodic review the replication deadlines established in the R&O. We agree with those petitioners who believe that, even as an incentive, a fixed date of 2004 (or 2005 for noncommercial stations) may be too soon to reasonably expect all stations to have constructed full replication facilities. However, during the next periodic review of the progress of the DTV transition, we will establish a new interference protection deadline that, as with the channel election deadline discussed above, may be earlier than but will not be later than the end of 2006 or the date by which a market meets the 85% digital penetration target, whichever is later. Our consideration of the issue of the appropriate interference protection deadline during the next periodic review will be informed by the progress that has occurred on issues such as band-clearing and recovering the spectrum for public safety use and other services.

21. Under the approach we are adopting today, stations will be allowed, without loss of full service area protection, to commence digital operations by constructing and operating facilities that at least provide the required level of digital signal strength to their communities of license. This will allow stations to focus their energies initially on providing digital service to their core communities, while permitting them later to expand their coverage area as the DTV transition progresses. We believe that this approach more closely reflects the marketplace realities, such as DTV receiver penetration, upon which the financial decisions of broadcasters and those who offer them financing are based. Because of the large costs of building and operating digital facilities, we recognize that some broadcasters, and particularly those in smaller markets, may need to take a more graduated approach to implementing digital service. The requirement that broadcasters serve their communities of license will ensure that, for most stations, the majority of their analog service populations will receive initial digital service. Once all broadcast stations have commenced at least the minimal level of service to their communities, we believe that DTV set penetration levels will increase and marketplace forces will work to further speed the transition and provide an incentive to broadcasters to expand to provide service to outlying areas. We are hopeful that this approach will prompt broadcasters to build out to their allotted power in response to consumer demand and competition from other stations. Thus, we will continue to protect the replication service areas in the DTV Table of Allotments until the replication protection deadline we establish in our subsequent periodic review.

22. We agree with those petitioners that argue that licensees seeking to construct maximized DTV facilities should be treated the same for purposes of interference protection as licensees seeking to construct allotted DTV facilities. Our goal in permitting DTV stations to apply to maximize was to ensure that they could increase their DTV signal coverage and provide DTV service competitively within their respective markets. The Commission was particularly concerned that it not artificially limit the size of DTV service areas for UHF analog licensees as an artifact of UHF analog service constraints. In enacting the Community Broadcasters Protection Act of 1999, Congress recognized the importance of preserving the right of DTV stations to maximize and established specific measures to ensure the protection of maximized service areas against new Class A stations.

23. The construction deadlines for remaining television licensees are May 1, 2002 (commercial) and May 1, 2003 (noncommercial), which are also the respective construction deadlines for outstanding construction permits for maximized facilities granted by the Commission. For the same reasons we temporarily deferred our regulatory replication incentive, we will continue to provide DTV interference protection for the time being to the maximized service area specified in outstanding DTV construction permits for facilities in excess of those specified in the DTV Table of Allotments. We intend in our next periodic review to establish a date by which broadcasters with authorizations for maximized digital facilities must either provide service to the coverage area specified in their maximization authorizations or lose DTV service protection to the uncovered portions of those areas. As with the channel election and replication deadlines for allotted DTV facilities discussed above, this deadline for completion of maximization facilities may be earlier than but will not be later than the latest of either the end of 2006 or the date by which 85% digital penetration is achieved.

24. By the action we take today, we give DTV licensees seeking to maximize facilities the same flexibility to implement graduated construction plans as licensees of facilities specified in the DTV Table of Allotments. Thus, licensees seeking to maximize may choose initially to construct and operate digital facilities that provide service only to their communities of license while retaining assurance that the maximized coverage area will be available in the future, until the deadline established in the next periodic review. We agree that this flexibility is especially important for UHF analog licensees that may face greater financial difficulty in constructing digital facilities than their analog VHF counterparts. We believe that providing flexibility to stations seeking to maximize will help speed the transition by allowing them to implement digital service with less costly facilities initially while still providing service to their core communities. Once these digital stations are on air, we expect that consumer demand for digital sets and signals will increase and that marketplace forces will act to encourage these stations to expand service to their maximized coverage area.

25. Licensees must construct at least the minimum initial facilities required to serve their community of license by May 1, 2002 (commercial) or May 1, 2003 (noncommercial). Licensees with an existing construction permit for a larger facility may elect to commence digital operation with a DTV facility that complies only with these minimum initial build-out requirements and is fully subsumed by the permitted facilities. We will also permit licensees that have not yet been granted a construction permit for allotted or maximized DTV facilities to request an STA to commence digital operation. Licensees choosing to request an STA should file their request with the Commission as early as possible and, in any event, at least 10 days before they plan to commence operation. The STA request must specify the technical facilities requested, including the station's ERP, HAAT, antenna pattern, if any, geographic coordinates, and tower registration number, if any. The STA request must also include a certification that the facilities are in compliance with the FCC's rules and that the coverage in any direction does not exceed that resulting from the allotted parameters in Appendix B or in an outstanding construction permit. In this regard, we urge licensees to pay special attention to compliance with FAA and FCC tower requirements, the community of license coverage requirement, and the FCC's environmental rules governing radio frequency (“RF”) radiation.

26. Once the Commission has granted a DTV STA request, the licensee or permittee will be authorized to commence digital service as specified in the STA. The Commission will make every effort to act on DTV STA requests within 10 days, absent oppositions or unusual circumstances. STAs will be granted for a period up to six months. The Commission delegates authority to the Mass Media Bureau to continue to extend STAs for additional periods not to exceed six months each until such time as the Commission determines otherwise (for example, by requiring that licensees either construct full replication or maximization facilities or relinquish interference protection). Under our rules, STAs are revocable at will.

27. Commercial and noncommercial stations that are operating pursuant to a DTV STA by their respective construction deadlines (May 1, 2002 or May 1, 2003) will be considered to have met this construction deadline, and their outstanding construction permits will be extended automatically until such time as the Commission determines otherwise (for example, by requiring that licensees either construct full replication or maximization facilities or relinquish interference protection). A copy of the STA issued by the FCC must be maintained in the station's local public inspection file. Periodically, the staff will issue public notices identifying the stations authorized to operate on DTV STAs and the parameters under which they are or will be operating. Stations operating pursuant to a DTV STA must comply with the enhanced community coverage requirement by December 2004 (December 2005 for noncommercial stations). Until the Commission determines otherwise, we will continue to provide interference protection to the facilities specified in outstanding DTV construction permits issued to permittees operating pursuant to a DTV STA as of their applicable construction deadlines, in addition to protection to the allotted facilities.

28. In the Fifth R&O we allowed DTV licensees to build initial facilities that placed the required DTV service level over their principal community of license. In turn, the required DTV service level was based on the level of service that they would provide at the edge of their authorized service areas ( i.e., at the edge of their NTSC Grade B contours) were they operating with full allotted DTV power and antenna height. In the R&O, we imposed a principal community coverage requirement that is stronger than the DTV service contour requirement that we adopted as an initial obligation in the Fifth R&O. We explained that the signal strength increase would improve the availability of service in the city of license and help prevent the migration of licensees from their community of license, thus furthering the purposes of section 307(b) of the Communications Act. The required level of service must be achieved by December 31, 2004 for commercial stations and December 31, 2005 for noncommercial stations. Operating DTV stations must be providing this level of service over their principal communities at that time.

29. We have decided to retain our enhanced principal community signal strength standard. The purpose of our revised requirement is to improve the availability and reliability of DTV service in the community of license and provide an extra measure of protection from interference to DTV service in the community. In addition, by requiring a higher level of service over the community of license, we will limit the extent to which licensees can migrate from their current service contour. These goals are consistent with the fundamental obligation of licensees to serve the needs and interests of their communities of license.

30. The 7dB increment in DTV service contour values that we adopted in the R&O was less than what we proposed in the NPRM. We explained that we chose a lower signal strength increase in order to provide broadcasters with flexibility in locating their transmitters while still improving the reliability of service to the community. While we recognized that some stations' currently authorized DTV facilities might not be able to encompass their principal communities with the increased city-grade signal level, we continue to believe that the less burdensome requirement that we adopted will not force many licensees to increase their power or to move their antenna. Even in cases where licensees have already constructed facilities that do not meet our increased city-grade coverage requirement, we believe that, given the location of most DTV towers, the cost of making the necessary changes to achieve compliance will be minimal in most instances.

31. Despite the arguments made by a number of petitioners, we decline to issue a blanket extension of the remaining DTV construction deadlines. As noted above, the NAB survey notes that more than two-thirds of responding commercial stations expect to be on the air in digital format by May 2002. Thus, there is substantial evidence that the conversion is progressing and that television stations are working hard to construct digital facilities. In view of the number of stations that have already made a commitment to complying with our deadlines and that have made a substantial investment in conversion, we do not believe that a blanket extension of the remaining deadlines is appropriate. Further, given the reduced build-out requirements we adopt herein, and the clear additional protection we will afford stations meeting these requirements, we believe that a large number of the stations that did not anticipate meeting the deadline will now be able to do so. One leading manufacturer, for instance, states that it can equip a small market station with minimal DTV facilities (500 watts) for less than $160,000, depending upon the size of the coverage area or other signal propagation characteristics.

32. It is possible, however, that a number of stations will not be in a financial position to provide digital service by next May, even with the reduced initial build-out requirements, and will be forced to request an extension of time to construct. In view of the limited financial resources of many of these stations, we believe that it is appropriate at this time to reconsider our standards for granting DTV extension requests.

33. In the Fifth R&O, we announced our willingness to grant, on a case-by-case basis, an extension of the applicable DTV construction deadline where a broadcaster has been unable to complete construction due to circumstances that are either unforeseeable or beyond the permittee's control, provided the broadcaster has taken all reasonable steps to resolve the problem expeditiously. We indicated that such circumstances include, but are not limited to, the inability to construct and place in operation a facility necessary for transmitting DTV, such as a tower, because of delays in obtaining zoning or FAA approvals, or similar constraints, or the lack of equipment necessary to transmit a DTV signal. We stated explicitly that we did not anticipate that the circumstances of “lack of equipment” would include the cost of such equipment. However, we also stated that we would take into account problems encountered that are unique to DTV conversion and would modify our existing policies regarding extensions accordingly.

34. As indicated by a number of petitioners and commenters, we recognize that some broadcasters, despite their reasonable good faith efforts, may not be in a financial position to timely complete the construction of their DTV facilities. We also recognize that, particularly for stations in smaller markets, the capital costs of conversion may be very high relative to the station's anticipated revenue. As a result, stations with lower revenues may find it more difficult to cover these costs in time to meet the construction deadline.

35. For many broadcasters, these financial obstacles will be alleviated by the reduced initial build-out requirements we have adopted today. We expect that even smaller market stations generally should be able to afford to finance the minimum DTV facilities required under our rules. Some broadcasters, however, may be unable to complete construction of even these minimum permitted facilities by the applicable deadline. Accordingly, we have determined that we will consider, on a case-by-case basis, in addition to the extension criteria outlined in the Fifth R&O, whether a broadcaster should be afforded additional time to construct its DTV facilities because the cost of meeting the minimum build-out requirements exceeds the station's financial resources. To qualify under this standard, the applicant must provide an itemized estimate of the cost of meeting the minimum build-out requirements and a detailed statement explaining why its financial condition precludes such an expenditure. We caution broadcasters that a brief downturn in the economy or advertising revenues will not be considered a sufficient showing of financial hardship. Rather, the showing must reflect the particular station's financial status over an economically significant period of time. In addition, the applicant must detail its good faith efforts to meet the deadline, including its good faith efforts to obtain the requisite financing, and explain why those efforts were unsuccessful. To the extent that the applicant's description of its financial condition sets forth information that is proprietary and not customarily disclosed to the public, the applicant may request that the Commission treat the information as confidential. Applicants must retain underlying documentation fully detailing and supporting their financial representations as well as any steps taken to overcome the circumstances preventing construction. Applicants will also be required to indicate when they reasonably expect to complete construction.

36. Applicants seeking an extension of time to construct a digital television station must file their extension request with the Commission at least sixty days, but no more than ninety days, prior to the applicable construction deadline. The Mass Media Bureau will issue a standard form (FCC Form 337) to be used to apply for an extension of time to construct a DTV station. As under the current standard, the Commission staff may grant no more than two extensions to any permittee, each for a period not exceeding six months. We direct the Mass Media Bureau to examine closely each extension request under the standards we adopt today, and promptly to notify applicants of any denial of an extension so that the applicant can timely complete construction in order to meet the applicable construction deadline. Subsequent extension requests will be referred to the Commission.

37. In the R&O, we decided to take a bifurcated approach to cut-off protection for DTV area expansion applications. With respect to all currently pending DTV expansion applications, we established cut-off protection as of the date of the adoption of the R&O (January 18, 2001). Thus, all DTV expansion applications pending as of the adoption date of the R&O are cut off and protected against later-filed DTV applications. We explained in the R&O that this approach would provide a measure of fairness to all applicants that filed DTV expansion applications prior to the adoption of the R&O by allowing all of them to be considered as part of one cut-off group. As for future DTV expansion applications filed after the adoption date of the R&O, we determined we would consider such applications cut-off as of the close of business on the day they are filed. We concluded that day-to-day cut-off processing for new DTV expansion applications would help to avoid a larger number of mutually exclusive (“MX”) applications and thus expedite processing of these applications and the provision of DTV service to the public. Day-to-day cut-off procedures also encourage potential applicants to file quickly for improved facilities, thereby speeding the introduction of improved DTV service to the public.

38. We find no reason to reverse our decision in this area. Our justification for adopting a single cut-off date rather than to utilize first-come first-serve processing with respect to the hundreds of pending DTV applications has not changed. In the R&O, we found that the main advantage of first-come first-serve processing—the elimination of mutually exclusive (MX) applications—would not be achieved in this case, as a large number of pending DTV applications were filed on certain critical DTV filing dates. Therefore, even if we were to have applied first-come first-serve processing, it would not have resulted in the elimination of numerous MX groups of applications that were filed on these dates. While Paxson and Fox both maintain that only a few of their applications were filed on these key dates, this does not change the fact that numerous other parties did file applications on those dates resulting in a large number of MX groups.

39. We reject Paxson and Fox's argument that adopting a single cut-off date was contrary to customary Commission processing procedures. As Barry Telecommunications, Inc. notes, the Commission has adopted a variety of different processing schemes over the years, each time determining that the particular scheme was appropriate for the service and circumstances in question, including single cut-off date lists, filing windows and first-come first-serve processing. Under the circumstances in this case, our approach to processing pending DTV applications, which balanced the needs of the licensees, the public and our interest in the orderly administration of spectrum, did not diverge from our prior practices.

40. As further justification for our decision, we recognized that there was an extended period of time over the several months leading to the adoption of the R&O during which we permitted DTV applications to be filed without indication that applicants needed to expedite their filings or lose out on an opportunity to expand their DTV allotments. Therefore, we found that first-come first-serve processing would unfairly prejudice those licensees, particularly smaller market and noncommercial educational licensees, that, as permitted, waited until their later deadlines to file their DTV applications. Contrary to the arguments raised by Paxson and Fox, we continue to find that the equities favor processing of the hundreds of DTV applications, including expansion applications, which were timely filed in reliance on the Commission's processing system. Barry notes that the Commission's DTV processing system included publication of deadlines for the filing of DTV applications that would be considered on an equal footing with prior filings. Noncommercial educational licensees like Barry have invested substantial resources in their proposals and we agree that Paxson's and Fox's proposals are no more entitled to priority consideration than these later-filed applications. As Barry points out, the Commission never provided any applicant assurance of protection beyond that which was provided in the DTV Table of Allotments. Any applicant that is trying to maximize its allocation was never guaranteed success on that filing and has no claim to favorable action based simply on the timing of its application. Having considered and rejected the arguments of the petitioners, we affirm our application of a single cut-off date to the DTV applications pending on January 18, 2001.

41. In the R&O, we gave priority to pending DTV expansion applications over all NTSC applications except NTSC applications that fell into one of three special categories—post-auction applications, applications proposed for grant in pending settlements, and any singleton applications cut-off from further filings. These applications must have been accepted for filing in order to be protected from DTV expansion applications. We stated that, in the future, when an applicant files a DTV expansion application, it must determine whether there are NTSC applications on file in any of the three categories and provide interference protection to them. As for pending DTV expansion applications, when one conflicts with an NTSC application in one of these categories, we stated that we would treat the applications as mutually exclusive (“MX”) and follow the procedures adopted in the R&O for MX applications—that is, we will require that the parties resolve their MX within 90 days or we will subsequently dismiss both applications.

42. We revise the procedures announced in the R&O in the following respects. First, we note that, by application of section 309(l) of the Communications Act, pending NTSC application groups on file prior to July 1, 1997, are entitled to compete in an auction that does not include applications filed on or after July 1, 1997. Therefore, pursuant to that statutory directive, we may not find DTV expansion applications (all of which were filed after June 30, 1997) to be mutually exclusive with NTSC application groups on file prior to July 1, 1997, regardless of whether these groups involve locations inside or outside the freeze areas or whether or not the groups have been settled. This is the case also where there is an NTSC application that was cut-off as part of a group of NTSC applications filed before July 1, 1997, but that is now a singleton because the other applications in the group have been dismissed. NTSC applications in these two categories shall be protected against DTV maximization applications. We believe these revisions to the procedure address the concerns of KM and ALF. DTV maximization applicants will be permitted to file minor amendments to resolve conflicts with NTSC applications in these categories. In addition, our decision today does not affect the ability of those DTV broadcasters whose maximization applications may interfere with NTSC applications in these categories from applying to maximize at the close of the transition on their analog allotment.

43. We have adopted a 2 percent de minimis interference standard for changes to DTV stations and allotments. In his petition for reconsideration, Donald G. Everist (Everist) seeks clarification regarding the analysis the Commission uses for determining whether the amount of interference caused by a DTV application to another DTV station is de minimis. Specifically, Everist is concerned with protection to a DTV station that has been authorized facilities that cover more people than the station's underlying DTV allotment (the Appendix B population) (DTV Table of Allotments, Second Memorandum Opinion and Order on Reconsideration of the Fifth and Sixth Report and Orders, 64 FR 4322, January 28, 1999, at Appendix B). Everist notes that predicted interference is to be determined to any people in the station's increased service area but indicates that the current Commission analysis seems to compare that interference population with the smaller Appendix B population to determine if the interference exceeds the 2% de minimis standard.

44. We clarify that the analysis comparison in this situation is to the station's Appendix B population, as Everist surmised. To the extent he is implying that the analysis should be changed, such a suggestion is beyond the scope of this reconsideration. The analysis was not adopted, altered, or even explained in the R&O. Furthermore, midstream changes to the analysis process raise issues of fair and consistent treatment of applicants and stations. It may be appropriate to consider a new approach at the time that protection of the Appendix B allotment ends. As decided elsewhere in this document, we are not currently establishing a date to end protection of that “replication” facility.

45. Fox also seeks clarification concerning the DTV interference analysis for determining that other DTV stations are protected. Fox urges the Commission to “only protect the stronger of either the allotted facilities or the currently authorized facilities.” Fox contends that protecting both makes the computation of protection unnecessarily complex by requiring analysis of all possible combinations of station facilities.

46. As Fox requests, we clarify that protection need not be determined for authorized DTV facilities that are smaller than, and encompassed by, the corresponding DTV allotment facilities. Specifically, applicants need not determine that protection is provided to other DTV station applications or authorizations that meet the technical criteria for “checklist” processing. The technical “checklist” criteria are: (1) proposed transmitter site within 5.0 kilometers of underlying DTV allotment reference coordinates, (2) proposed antenna HAAT not exceeding underlying DTV allotment HAAT by more than 10 meters, and (3) proposed ERP in every azimuthal direction not exceeding underlying DTV allotment ERP for that direction, (with a small ERP adjustment if the proposed HAAT differs from the DTV allotment HAAT). In general, a “checklist” application will produce a DTV service area that is contained within the replication service area of the underlying DTV allotment. In addition to “checklist” applications and authorizations, there are applications and resulting DTV authorizations that are considered “checklist-like.” These applications and authorizations do not meet one or more of the technical “checklist” criteria, but produce a DTV service area that is contained with the replication service area of the underlying DTV allotment. As with “checklist” applications and authorizations, “checklist-like” applications and authorization need not be protected by applications from other DTV stations. Protection of the underlying DTV allotment is required.

47. We note that the Fox request also could be interpreted to request a more extensive limitation on the DTV facilities that must be protected, and we do not find such a limitation warranted. For example, a DTV station might have authorized facilities that are neither “checklist” nor “checklist-like,” where such authorization extends the underlying DTV allotment service contour in some directions and contracts the service contour in other directions. Under such a circumstance, the authorized contour would not be entirely contained within the allotment contour and conversely, the allotment contour would not be entirely contained within the authorized contour. One interpretation of the Fox request would be to only protect the authorized service if it reaches more people or area than the allotment. Similarly, that interpretation would only protect the allotment service if it reaches more people or area than the authorized facility. For two reasons, we are not accepting this more limited protection calculation. First, it is inconsistent with our decision in the replication section of the R&O. There we decide to continue to protect DTV allotment service. The Fox proposal would only continue that allotment protection if that service area or population is larger than the authorized (or applied for) service. Second, where a DTV authorization allows a service area to be shifted from the DTV allotment service area, we do not believe it is fair or appropriate to deny protection to that authorized service area if it reaches fewer people or less overall area than the allotment facility would reach.

48. We have established tables and formulas for determining maximum effective radiated power (ERP) limits for various antenna heights, channels and zones. In the R&O, we clarified our process for applying an alternative determination of a DTV station's maximum ERP based on matching the coverage area of the largest station in the market. We indicated that the provision is triggered only where a station in a market is covering a larger area than could be covered with standard maximum power and antenna height. KM seeks additional clarification regarding the reference to standard maximum power and antenna height, asking if it refers to the largest station in the market or to the DTV station proposing to maximize. KM also asks if the standard refers to the DTV Table of Allotment parameters, or some other parameters that may be permitted under the Commission's rules.

49. We clarify that the standard maximum facilities are the power and antenna height limits specified in § 73.622(f)(6)-(8) of our Rules. For example, for UHF DTV stations, the standard maximum ERP is 1000 kilowatts (kW) if the antenna HAAT is 365 meters (m) or less (365 m is approximately 1200 feet). For antennas located at higher HAATs, the standard maximum ERP is reduced, with the standard maximum UHF DTV ERP being 750 kW at an HAAT of 425 m and 316 kW at 610 m. We also clarify that the largest station provision is applied when a DTV application requests an ERP greater than the rule allows for its requested HAAT on its channel. Thus it is the standard maximum ERP of the DTV station proposing to maximize that triggers applicability of the “largest station” provision.

50. As we stated in the R&O, while we recognize the desire to initiate DTV operations on translator and booster facilities, we believe there are fundamental issues surrounding their authorization and protection that must be addressed in a more comprehensive manner than can be accomplished based on the limited record on this issue in this proceeding. Accordingly, we will defer consideration of these issues to a separate rulemaking proceeding on digital LPTV, translator and booster stations. We hope to initiate this proceeding in the near future.

51. In this MO&O, we revise a number of the determinations we made in the R&O to ensure continued progress in the transition to digital broadcasting. By temporarily deferring the channel election and replication deadlines established in the R&O, and by extending interference protection to maximized service areas, our intention is to prioritize those elements that are most important to the DTV transition. Our primary goal is to maximize the number of DTV stations on the air and provide service to most, if not all, consumers. We believe that our actions today will help further the transition and promote the goal of replication by increasing the number of DTV stations on the air and the number of DTV receivers in the hands of consumers. Once set penetration rates increase, we believe that marketplace forces will provide further incentives that will result in the expansion of DTV service in the future.

52. Regulatory Flexibility Analysis. Pursuant to the Regulatory Flexibility Act of 1980, as amended, the Commission's Supplemental Final Regulatory Flexibility Analysis has been completed and attached.

53. Paperwork Reduction Act Analysis. The actions taken in this MO&O have been analyzed with respect to the Paperwork Reduction Act of 1995 (“Act”) and found to impose new or modified reporting and recordkeeping requirements or burdens on the public. Implementation of these new or modified reporting and recordkeeping requirements will be subject to approval by the Office of Management and Budget (“OMB”) as prescribed by the Act.

54. Comments. As part of our continuing effort to reduce paperwork burdens, we invite the general public to take this opportunity to comment on the information collections contained in this MO&O, as required by the Paperwork Reduction Act of 1996. Public and agency comments are due February 19, 2002. Comments should address: (a) whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; (b) ways to enhance the quality, utility, and clarity of the information collected; and (c) ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology. In addition to filing comments with the Secretary, a copy of any comments on the information collections contained herein should be submitted to Judy Boley, Federal Communications Commission, 445 Twelfth Street, S.W., Room C-1804, Washington, D.C. 20554, or via the Internet to jboley@fcc.gov and to Edward Springer, OMB Desk Officer, 10236 NEOB, 725 17th Street, N.W., Washington, D.C. 20503 or via the Internet to edward.springer@omb.eop.gov.

55. As required by the Regulatory Flexibility Act (RFA), an Initial Regulatory Flexibility Analysis (IRFA) was incorporated in the Notice of Proposed Rule Making (NPRM) and a Final Regulatory Flexibility Analysis (FRFA) was incorporated in the R&O. The Commission sought written public comment on the proposals in the NPRM, including comment on the IRFA. No comments were received in response to the IRFA or the FRFA. The present Supplemental Final Regulatory Flexibility Analysis (“Supplemental FRFA”) conforms to the RFA.

56. In January 2001, we released an R&O and Further Notice of Proposed Rule Making in MM Docket 00-39 (66 FR 9973, February 13, 2001) (R&O), addressing a number of issues related to the conversion of the nation's broadcast television system from analog to digital television (DTV). Among the issues addressed in the R&O were: when to require election by licensees of their post-transition DTV channel; whether to require replication by DTV licensees of their NTSC Grade B service contours (thereby providing coverage to those who receive the station's analog signal); whether to require DTV licensees to place enhanced service contours over their principal communities (thereby serving these communities with a stronger signal); and how we should process mutually exclusive applications. We expressed our belief that resolution of these issues would provide licensees with a measure of certainty that would help them plan facilities, order equipment, and arrange for construction of facilities, all of which will speed the transition to digital service.

57. We received a number of petitions for reconsideration of the R&O. In this Memorandum Opinion and Order on Reconsideration (MO&O), we revise a number of the determinations we made in the R&O, affirm other decisions, and provide clarification of certain rules and policies. We also modify, on our own motion, the minimum hours of operation of certain DTV stations and establish guidelines for television stations that may seek an extension of our May 1, 2002 and May 1, 2003 deadlines for construction of DTV facilities. We will resolve several major technical issues raised in the R&O and Further Notice of Proposed Rule Making, including the issues of receiver performance standards, DTV tuners, revisions to certain components of the DTV transmission standard, and labeling requirements for television receivers, in a separate Report and Order.

58. No comments were received in response to the IRFA, and no petitions or comments were received in response to the FRFA contained in the R&O. However, a number of parties that filed petitions for reconsideration or comments in response to the R&O and Further Notice of Proposed Rule Making raised concerns about the impact of the channel election and replication protection deadlines on broadcasters, and particularly broadcasters in smaller television markets. Generally, smaller market broadcasters assert that they will not be able to obtain the financing to construct DTV facilities sufficient to replicate their analog service area, and that they will not have sufficient operational experience by December 2004 (the channel election deadline for commercial stations) to determine which core channel is superior for DTV transmission.

59. In this MO&O, we respond to these concerns by allowing stations to construct more minimal initial DTV facilities designed to serve their communities of license while still retaining, for the time being, DTV interference protection to the full replication facility. We also temporarily defer the deadline by which broadcasters with two in-core allotments (television channels 2-52) must elect which channel they will eventually use for DTV at the end of the transition. In our next periodic review of the progress of the DTV transition, the Commission intends to establish a firm date by which broadcasters must either replicate their NTSC service areas or lose DTV service protection of the unreplicated areas, and by which broadcasters with two in-core allotments must elect which channel they will use post-transition. These replication protection and channel election deadlines may be earlier than but will in no event be later than the latest of either the end of 2006 or the date by which 85% of the television households in a licensee's market are capable of receiving the signals of digital broadcast stations. In addition, we also allow DTV stations required to complete construction of DTV facilities by May 1, 2002 or May 1, 2003 to operate initially at a reduced schedule by providing, at a minimum, a digital signal during prime time hours, consistent with their simulcast obligations. In order to provide parity to analog UHF stations, we will also allow stations to construct initial DTV facilities that serve their principal communities while retaining DTV interference protection to their maximized service areas for the time being, subject to the interference protection deadline we intend to establish in the next periodic review.

60. We do not alter, however, our decision to require stations to provide a stronger DTV signal to their communities of license than that adopted as an initial requirement in the Fifth R&O in MM Docket 87-268 63 FR 135461, May 29, 1998). As established in the R&O, this new city-grade service requirement will become effective December 31, 2004 for commercial stations and December 31, 2005 for noncommercial stations. The majority of petitioners that addressed this issue did not object to the Commission's increased city grade signal requirement as long as it was implemented in conjunction with a waiver policy that affords broadcasters flexibility in certain circumstances. Some commenters pointed out that broadcasters face many different configurations of terrain and geography, not all of which lend themselves to siting towers that both provide the widest possible service and cast a stronger signal over the principal community. Other commenters noted that some broadcasters have already built DTV facilities that may have to be moved or expensively reconfigured to meet the new principal community coverage requirement.

61. The purpose of the stronger city-grade signal strength requirement is to improve the availability and reliability of DTV service in the community of license and provide an extra measure of protection from interference to DTV service in the community. In addition, by requiring a higher level of service over the community of license, we will limit the extent to which licensees can migrate from their current service contour. These goals are consistent with the fundamental obligation of licensees to serve the needs and interests of their communities of license. The 7dB increment in DTV service contour values that we adopted in the R&O was less than what we proposed in the NPRM. We explained that we chose a lower signal strength increase in order to provide broadcasters with flexibility in locating their transmitters while still improving the reliability of service to the community. While we recognized that some stations' currently authorized DTV facilities might not be able to encompass their principal communities with the increased city-grade signal level, we continue to believe that the less burdensome requirement that we adopted will not force many licensees to increase their power or to move their antenna. Even in cases where licensees have already constructed facilities that do not meet our increased city-grade coverage requirement, we believe that, given the location of most DTV towers, the cost of making the necessary changes to achieve compliance will be minimal in most instances.

62. We also received comments and petitions requesting an extension of the remaining deadlines (May 1, 2002 commercial and May 1, 2003 noncommercial) to complete construction of DTV facilities. Generally, these parties argue that stations in smaller markets need additional time to plan and construct their DTV facilities given the expense involved in conversion and the lower level of profitability of these stations. Petitioners also argue that it is unreasonable to expect small market broadcasters to commence digital service in the midst of the uncertain market conditions created by, among other things, the issues surrounding the DTV transmission standard and the low rate of DTV receiver penetration. In addition, parties claim that many stations have yet to receive their DTV permits with only a few months left before the construction deadline, which has made it difficult for broadcasters to schedule highly-demanded tower construction crews and to coordinate the purchase of costly equipment. Several petitioners support extending the construction deadline to May 1, 2003 (the same deadline as noncommercial educational stations) for stations in markets 50-100, and to May 1, 2004 for stations in markets above 100. Others propose tying build-out requirements to a market-defined milepost, such as DTV receiver penetration levels.

63. In response to these views, we modify in the MO&O our guidelines for television stations that may seek an extension of our May 1, 2002 and May 1, 2003 deadlines for construction of DTV facilities, making extensions available to broadcasters that can demonstrate that the cost of meeting the minimum build-out requirements exceeds the station's financial resources.

64. The RFA directs agencies to provide a description of and, where feasible, an estimate of the number of small entities that may be affected by the rules. The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. A small business concern is one that: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the Small Business Administration (SBA).

65. Small TV Broadcast Stations. The SBA defines small television broadcasting stations as television broadcasting stations with $10.5 million or less in annual receipts.

66. The digital television rules we address in the MO&O apply to commercial and noncommercial television stations. There are approximately 1,304 existing commercial television stations and 374 existing noncommercial television stations of all sizes that may be affected by the digital television rules addressed in the MO&O.

67. The MO&O directs the FCC's Mass Media Bureau to issue a standard form (FCC Form 337) to be used to apply for an extension of time to construct a DTV station. We estimate that it will take applicants 1 hour and 30 minutes to complete the form.

68. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its proposed approach, which may include the following four alternatives (among others): (1) The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance reporting requirements under the rule for small entities; (3) the use of performance, rather than design standards; and (4) an exemption from coverage of the rule, or any part thereof, for small entities.

69. We made a number of determinations in the R&O that we believed would further progress on the transition from analog to digital television. Among other things, we established a deadline of December 31, 2003 by which commercial television stations that have both their NTSC and DTV operations on in-core channels must elect which of their two core channels to use for DTV operations after the transition. We gave non-commercial stations that have both their NTSC and DTV operations on in-core channels until the end of 2004 to elect their post-transition DTV channel. We determined that this early channel election would allow us to identify more quickly channels that will be available to accommodate DTV licensees with out-of-core transition channels as well as new entrants. In addition, to provide broadcasters with an incentive to provide full replication of NTSC coverage with DTV service, we determined that, after December 31, 2004, whatever portion of a commercial broadcaster's NTSC Grade B contour is not replicated with its digital television signal will cease to be protected in the DTV Table of Allotments. Noncommercial DTV licensees were given until December 31, 2005 in which to replicate or lose such DTV interference protection.

70. Upon further consideration, we determine in the MO&O that the channel election and replication requirements may be imposing substantial burdens on broadcasters, and especially on smaller stations, without sufficient countervailing public benefits, and may in fact be contributing to difficulties faced by a substantial number of stations, particularly smaller stations, in meeting their DTV construction deadlines. A survey conducted by NAB indicates that slightly less than one-third of all stations responding to the NAB survey anticipate that they will not be able to provide a digital signal by the May 2002 deadline. A larger percentage (81.9%) of responding stations in the top 50 markets (larger market stations) anticipate that they will meet the deadline, while a smaller percentage (49.1%) of stations in markets 100 and above (smaller-market stations) indicated they will complete construction on time. Three-quarters of those stations that do not anticipate meeting the May 2002 deadline indicated they plan to seek an extension of this deadline from the FCC. Generally, smaller market broadcasters that filed petitions in this proceeding assert that they are unable to obtain financing to construct DTV facilities sufficient to replicate their analog service area. These broadcasters also claim that they will not have sufficient operational experience by December 2004 to determine which core channel is superior for DTV transmission. Broadcasters that are not capable of constructing full replication facilities by the deadline established in the R&O may be postponing construction altogether.

71. Upon reconsideration, we decide in the MO&O to allow stations to construct initial DTV facilities designed to serve at least their communities of license, while still retaining DTV interference protection to provide full replication until such deadline as the Commission shall establish in its next periodic review of the progress of the DTV transition. Thus, we temporarily defer both the replication protection and channel election deadlines we established in the R&O. In our next periodic review of the progress of the DTV transition, the Commission intends to establish a firm date by which broadcasters must either replicate their NTSC service areas or lose DTV service protection of the unreplicated areas, and by which broadcasters with two in-core allotments must elect which channel they will use post-transition. These replication protection and channel election deadlines may be earlier than but will in no event be later than the latest of either the end of 2006 or the date by which 85% of the television households in a licensee's market are capable of receiving the signals of digital broadcast stations. In order to provide parity to analog UHF stations, many of which are smaller stations, we will also allow stations to construct initial facilities that serve their principal communities while retaining DTV interference protection to their maximized service areas until the maximization deadline to be established by the Commission in its next periodic review. This alternative significantly reduces the costs associated with constructing and operating initial DTV facilities as compared to the requirements adopted in the R&O.

72. In contrast, the Commission could have retained its channel election and replication protection deadlines established in the R&O. However, we have determined that those deadlines may be too burdensome, and that the Commission should reexamine what deadlines are appropriate in its next periodic review in light of the record developed in the interim regarding the progress of the DTV transition. The alternative selected herein works to benefit smaller stations by facilitating their compliance with the May 1, 2002 (commercial) and May 1, 2003 (noncommercial) construction deadlines.

73. The MO&O also allows stations required to construct and operate DTV facilities by May 1, 2002 or May 1, 2003 to operate initially in digital format at a reduced schedule by providing, at a minimum, a digital signal during prime time hours, consistent with their simulcast obligations. This alternative also significantly reduces the costs associated with initial operation of DTV facilities for these smaller stations. In contrast, the Commission could have retained the requirement for these stations that they operate in digital format whenever they transmit in analog format, greatly increasing their costs. Although the Commission considered reducing the minimum operating hours for all digital stations, we believe that the prime time obligation adopted in the MO&O for smaller stations appropriately balances our concern to reduce the burden on these broadcasters where possible with our goal of furthering progress in the transition to digital broadcasting.

74. In addition, in the MO&O we modify our guidelines for television stations that may seek an extension of the DTV construction deadlines. In the Fifth R&O, we announced our willingness to grant, on a case-by-case basis, an extension of the applicable DTV construction deadline where a broadcaster has been unable to complete construction due to circumstances that are either unforeseeable or beyond the permittee's control, provided the broadcaster has taken all reasonable steps to resolve the problem expeditiously. We indicated that such circumstances include, but are not limited to, the inability to construct and place in operation a facility necessary for transmitting DTV, such as a tower, because of delays in obtaining zoning or FAA approvals, or similar constraints, or the lack of equipment necessary to transmit a DTV signal. We stated explicitly that we did not anticipate that the circumstances of “lack of equipment” would include the cost of such equipment.

75. As indicated by a number of petitioners and commenters, we recognize that some broadcasters, despite their reasonable good faith efforts, may not be in a financial position to timely complete the construction of their DTV facilities. Many stations are finding it difficult to obtain the substantial sums required to construct digital television facilities. Many stations are also experiencing decreasing revenues in part as a result of the slowdown in the overall economy, which has slowed even further in the wake of the events of September 11, 2001. We also recognize that, particularly for stations in smaller markets, the capital costs of conversion may be very high relative to the station's anticipated revenue. As a result, stations with lower revenues may find it more difficult to cover these costs in time to meet the construction deadline.

76. For some broadcasters, these financial obstacles may be alleviated by the reduced initial build-out requirements adopted in the MO&O. Other broadcasters, however, may be unable, for purely financial reasons, to complete construction of even these minimum permitted facilities by the May 1, 2002 deadline. Accordingly, in the MO&O we determine that we will consider, on a case-by-case basis, in addition to the extension criteria outlined in the Fifth R&O, whether a broadcaster should be afforded additional time to construct its DTV facilities because the cost of meeting the minimum build-out requirements exceeds the station's financial resources. This new waiver standard should be particularly beneficial to smaller market broadcasters and those with fewer resources.

77. This relaxation of our extension standard will benefit small entities by giving additional leeway to stations in smaller markets that need more time to construct because of their lower revenues. By permitting these stations to delay the transition for a brief period of time, they will be able to spread the large investments needed to convert over more years. By delaying the transition for a short period for those stations that face the greatest financial challenges, these stations may also benefit from further progress overall in the transition, including greater consumer demand for digital television signals and greater advertising revenue.

78. We considered but declined in the MO&O to issue a blanket extension of the remaining DTV construction deadlines. It appears that more than two-thirds of commercial stations will be on the air in digital format by May 2002. Thus, there is substantial evidence that the conversion is progressing and that television stations are working hard to construct digital facilities. In view of the number of stations that have already made a commitment to complying with our deadlines and that have made a substantial investment in conversion, we do not believe that a blanket extension of the remaining deadlines is appropriate. Further, given the reduced build-out requirements we adopt herein, and the clear additional protection we will afford stations, including smaller stations, meeting these requirements, we believe that many of the stations that did not anticipate meeting the deadline will now be able and willing to do so.

79. The Commission will send a copy of the MO&O, including this Supplemental FRFA, in a report to be sent to Congress pursuant to the Congressional Review Act. In addition, the Commission will send a copy of the MO&O, including the Supplemental FRFA, to the Chief Counsel for Advocacy of the SBA. A copy of the MO&O and Supplemental FRFA (or summaries thereof) will also be published in the Federal Register .

80. Pursuant to authority contained in sections 1, 4(i), 303, and 336(f) of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 303, and 336(f), Part 73 of the Commission's rules, 47 CFR Part 73, ARE AMENDED as set forth in the Rule Changes below.

81. The amendments set forth in the Rule Changes SHALL BE EFFECTIVE February 19, 2002. FCC Form 337 contains information collection requirements that have not been approved by OMB. Public and agency comments on these information collections are due February 19, 2002. The FCC will publish a document announcing the effective date of FCC Form 337 once OMB approval is received.

82. The petitions for reconsideration or clarification received in response to the R&O Are Granted to the extent provided herein and otherwise Are Denied .

83. The Commission's Consumer Information Bureau, Reference Information Center, Shall Send a copy of this MO&O, including the Supplemental Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.

84. This proceeding Is Terminated .

Television, broadcasting.