[Federal Register Volume 67, Number 178 (Friday, September 13, 2002)]
[Rules and Regulations]
[Pages 57970-57973]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-23397]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

50 CFR Parts 222, 223 and 224

[Docket No. 011130288-2205-02; I.D. 092101C]
RIN 0648-AP64


Endangered and Threatened Species; Transfer of Certain Permits

AGENCY: National Marine Fisheries Service (NMFS), National Oceanic and 
Atmospheric Administration (NOAA), Commerce.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: NMFS issues a final rule that allows the transfer of certain 
permits under the Endangered Species Act (ESA) of 1973, as amended. 
This final rule allows the transfer of incidental take permits and 
enhancement of survival permits associated with Safe Harbor Agreements 
with Assurances or Candidate Conservation Agreements with Assurances. 
Currently, if a permit holder wants to sell land or business operations 
covered by a permit to a new owner, the new owner would need to apply 
for a separate permit. Regulations pertaining to similar permits issued 
by the US Fish and Wildlife Service (USFWS) allow such transfers. This 
final rule will revise NMFS regulations to allow transfers, promoting 
efficiency and consistency with USFWS regulations.

DATES: Effective on October 15, 2002.

ADDRESSES: Chief, Endangered Species Division, Office of Protected 
Resources, NMFS, 1315 East-West Highway, Silver Spring, MD 20910.

FOR FURTHER INFORMATION CONTACT: Margaret Lorenz or Lamont Jackson at 
(301) 713-1401.

SUPPLEMENTARY INFORMATION:

Background

    NMFS is responsible for implementing the ESA, 16 U.S.C. 1531-1544, 
with respect to most threatened and endangered marine species. NMFS' 
regulation at 50 CFR 222.305 prohibits the transfer of all permits 
issued under 50 CFR parts 222, 223, and 224. This includes permits to 
``take'' ESA-listed species issued under section 10(a) of the ESA. On 
December 21, 2001, NMFS published a proposed rule that would allow the 
transfer of section 10 permits associated with Habitat Conservation 
Plans, Safe Harbor Agreements with Assurances, and Candidate 
Conservation Agreements with Assurances. This final rule revises the 
regulation to allow the transfer of these permits if certain 
requirements are met.
    While the restrictions imposed on permit succession and 
transferability are justified in some situations (e.g., scientific 
research permits and permits for enhancement of propagation), they are 
unnecessary and inappropriate for incidental take permits and 
enhancement permits associated with Safe Harbor Agreements with 
Assurances or Candidate Conservation Agreements with Assurances. These 
three types of permits involve substantial long-term conservation 
commitments, and NMFS recognizes that there may be succession or 
transfer in ownership during the term of the permit. NMFS and USFWS 
often issue permits covering the species under their respective 
jurisdictions to the same landowner, based on the same conservation 
plan. In 1999 the USFWS revised its permit transfer regulation to allow 
the transfer of these enhancement and incidental take permits, provided 
certain conditions are met. (64 FR 32706, June 17, 1999). In 2001, 
USFWS reconfirmed its decision to allow the transfer of these permits. 
(66 FR 6483, Jan. 22, 2001).
    NMFS believes that a blanket prohibition on transferability of 
incidental take permits under ESA section 10(a)(1)(B) and enhancement 
permits issued for Safe Harbor Agreements with Assurances and Candidate 
Conservation Agreements with Assurances under section 10(a)(1)(A) is 
unnecessarily restrictive, given the context and purpose of these plans 
and agreements. This final rule removes the prohibition on 
transferability of incidental take and enhancement permits with respect 
to these named agreements. This final rule requires, however, that 
prior to accepting a proposed transfer of a permit, NMFS determine that 
the proposed transferee has given adequate written assurance to NMFS 
that it can and will fulfill the obligations of the conservation plan 
or agreement.

Description of Permits

    Incidental Take Permit: NMFS issues permits under section 
10(a)(1)(B) of the ESA to take listed species incidental to the 
carrying out of an otherwise lawful activity, provided the requirements 
of that section are met. One of these requirements is the submission of 
a conservation plan, often referred to as a Habitat Conservation Plan 
or HCP, to minimize and mitigate for take that will occur during the 
term of the permit. HCP's often involve long-term conservation 
commitments that obligate

[[Page 57971]]

a landowner or business operator for the life of the permit, which may 
be as long as 100 years, cover hundreds of thousands of acres, and/or 
require substantial capital investments.
    Safe Harbor Agreements with Assurances: Under the joint USFWS/NMFS 
Safe Harbor policy (64 FR 32717 (June 17, 1999)), non-Federal property 
owners with an approved agreement may receive assurances that 
additional land, water, and/or natural resource use restrictions will 
not be imposed in exchange for their voluntary conservation actions to 
benefit listed species covered in the agreement. If the conservation 
actions will provide a net conservation benefit to the covered species 
and the property owner meets all the terms of the Agreement, NMFS will 
authorize the taking of the covered species to enable the property 
owner to ultimately return the enrolled property back to agreed upon 
conditions. These assurances will be provided in the property owner's 
Safe Harbor Agreement and in an associated enhancement of survival 
permit issued under section 10(a)(1)(A) of the ESA. While USFWS has 
adopted regulations to implement this policy (50 CFR 17.22(c)), NMFS 
has not yet done so and has entered into no Safe Harbor Agreements at 
this time. If NMFS were to do so, this transferability rule would apply 
to the permits issued with these agreements.
    Candidate Conservation Agreement with Assurances: Under the joint 
USFWS/NMFS Candidate Conservation policy (64 FR 32726; (June 17, 
1999)), non-Federal property owners who commit to implement adequate 
conservation measures for a candidate or proposed species, or a species 
likely to become candidate or proposed in the near future, will receive 
assurances that additional conservation measures will not be required 
and additional land, water, or resource use restrictions will not be 
imposed should the species become listed in the future. The 
conservation measures in the agreement, when combined with those 
benefits that would be achieved if it is assumed that the conservation 
measures would also be implemented on other necessary properties, must 
be sufficient to preclude or remove any need to list the species 
covered by the agreement. Assurances are provided in the property 
owner's Candidate Conservation Agreement with Assurances and, if the 
species becomes listed, in an associated enhancement of survival permit 
issued under section 10(a)(1)(A) of the ESA.
    While USFWS has adopted regulations to implement this policy (50 
CFR 17.22(d)), NMFS has not yet done so and has entered into no 
Candidate Conservation Agreements with Assurances at this time. If NMFS 
were to do so, this transferability rule would apply to the permits 
issued with these agreements.

Rationale for Rule Change

    A permittee may wish to transfer business operations or covered 
land, or a portion of it, during the term of the permit. Species 
covered by the permit's conservation measures should not be affected by 
a change in ownership if successive owners are qualified to hold the 
permit, and agree to be bound by the terms of the permit. Landowners 
are more likely to be willing to undertake these commitments if they 
know they can transfer their incidental take authorization and 
conservation obligations to a qualified purchaser.
    In addition, in many instances both USFWS and NMFS issue permits to 
the same landowner or operator, based on the same conservation plan or 
agreement. Since 1999, USFWS and NMFS have had inconsistent regulations 
with regard to transferability of incidental take and enhancement 
permits. NMFS and USFWS strive for consistency in administration of the 
ESA, to promote efficiency and reduce confusion on the part of the 
public and the regulated community. This final rule addresses this 
inconsistency.
    This final rule removes constraints on permit transferability to 
allow those who have permits associated with HCP's, Safe Harbor 
Agreements with Assurances, and Candidate Conservation Agreements with 
Assurances the flexibility to transfer permits to qualified purchasers. 
It allows transfer of these permits only so long as the successor or 
transferee owner meets the general qualifications for holding the 
permit and agrees to the terms of the HCP, Safe Harbor Agreement with 
Assurances, or Candidate Conservation Agreement with Assurances.

Overview of the Revisions to Permit Regulations

    Section 222.305(a) is revised to allow transferability of permits 
issued under 50 CFR parts 222, 223, and 224, where NMFS determines the 
transferee has given adequate written assurance (e.g., signing of a 
contract or assumption agreement between NMFS and the new landowner) 
that it can and will fulfill the obligations of the permit.
    This final rule does not apply to scientific research permits or 
enhancement of propagation permits issued under ESA section 
10(a)(1)(A). It applies only to incidental take permits, and to 
enhancement of survival permits issued under section 10(a)(1)(A) in 
association with a Safe Harbor Agreement with Assurances or a Candidate 
Conservation Agreement with Assurances. Permits issued by NMFS for 
scientific research and enhancement of propagation for ESA-listed 
species, including marine mammals (50 CFR 222.308, 216.41) are not 
transferable (50 CFR 216.35), and this final rule will not affect this 
restriction or the regulations at 50 CFR 216.41 and 222.308. These 
permits are not transferable because they require that the holder/
principal investigator be qualified to conduct the research or 
enhancement activities described in the original application and 
permit. The permit is issued in reliance on the qualifications of the 
permit applicant and thus should not be transferable without a thorough 
assessment of the qualifications of another applicant. Transferability 
streamlines the permit process and is inappropriate for permits that 
are dependent upon the permittee's qualifications.

Summary of Comments in Response to the Proposed Rule

    The public comment period for the proposed rule was open from 
December 18, 2001, through February 4, 2002. During the comment period, 
NMFS received comments from two parties, Environmental Defense and 
Northwest Environmental Defense Center. A summary of the comments and 
NMFS' responses to those comments follows.
    Comment 1: Commenter opposes this rule change because it removes 
public participation from the permitting process, which violates the 
intent of the ESA.
    Response: Issuance of a new section 10 permit is always subject to 
public notice and comment. If a permit is transferred from one business 
operator or landowner to another with no changes in the terms or 
duration of the conservation plan or the permit, and NMFS is satisfied 
that the transferee will meet the obligations in the plan, the business 
or land would continue to be managed under a plan that has been the 
subject of public comment. There will be no fundamental change to the 
terms of the permit or plan. If the proposed transferee wishes to 
change the terms of the permit or plan, NMFS would regard this as a new 
permit application subject to notice and comment.
    Comment 2: Commenter recommends the preparation of an environmental 
impact statement (EIS) or an environmental assessment (EA) under the 
National Environmental Policy Act

[[Page 57972]]

(NEPA), to evaluate the environmental impacts of the permit transfer.
    Response: If the business or land is simply changing hands, and the 
new owner agrees to the conditions of the previous plan with no 
additions or changes, there should be no additional environmental 
impacts that were not considered in the NEPA analysis that accompanied 
the permit application. NMFS believes transfers can be accomplished 
with a categorical exclusion from NEPA analysis.
    Comment 3: Commenter believes the proposed rule will impact the 
recovery of threatened and endangered species because it will remove 
NMFS authority to review plans and to re-evaluate the effectiveness of 
the permit upon transfer.
    Response: Assuming a transferee will abide by the terms of the 
permit and plan, there is no basis for comprehensive re-evaluation of a 
plan that was found to meet ESA standards at the time the permit was 
issued, simply because the covered business or land happens to be 
transferred to another owner. Moreover, all long-term permits require 
periodic reports to NMFS. After transfer of a permit, NMFS will retain 
the same authority to review compliance with permit conditions and 
effectiveness of conservation measures that it had with respect to the 
initial permittee.
    Comment 4: Commenter objects to the use of a contract between NMFS 
and the transferee to assure that the transferee will comply with the 
terms of the HCP.
    Response: NMFS adopted this approach from the USFWS. The contract 
is not the only assurance that the transferee will comply with the HCP 
or other agreements. The transferee will lose take authorization if it 
does not comply with the terms of the permit. A permit may be suspended 
or revoked for noncompliance (15 CFR 904.320). This provision applies 
to all permit holders, whether they are original permit applicants or 
transferees.
    Comment 5: Commenter recommends that NMFS take steps to ensure that 
transferees understand the terms of the conservation plan and can 
fulfill the commitments of the HCP or agreement.
    Response: NMFS will take all necessary steps to ensure that the 
prospective transferee understands the permit and plan obligations and 
has the capability to implement the plan as written. The final rule 
requires the proposed transferee to provide ``such other information as 
NMFS determines is relevant to process the transfer (Sec.  
222.305(a)(3)(iii)).'' NMFS will obtain all information necessary to 
make the determinations required in this final rule. The final rule has 
been revised to require that NMFS make these determinations in writing, 
to assure that the basis for the determinations is documented.
    Comment 6: Commenter believes the rule will have significant 
impacts because it will allow the transfer of permits when there is no 
system in place to account for the take of listed species resulting 
from permits already issued by NMFS.
    Response: As noted in the response to Comment 3, all conservation 
plans require periodic reports to NMFS on implementation of the plan. 
NMFS reviews reports to determine, among other things, if it is likely 
that incidental take beyond what was anticipated at the time the permit 
was issued has occurred. NMFS conducts these reviews regardless of 
whether a permit is transferred. Transfer of a permit should have no 
bearing on NMFS' ability to track incidental take.
    Comment 7: Commenter suggested NMFS clarify or revise the part of 
the proposed rule that says a permittee has to meet all of the 
qualifications of parts 222, 223, and 224 (as applicable) for holding a 
permit. Commenter notes that Sec.  222.308(c) says only that the 
Assistant Administrator shall consider certain factors in making a 
permit determination but does not list qualifications for holding a 
permit.
    Response: This final rule is not limited to qualifications under 50 
CFR 308(c). The rule provides that the transferee must meet all the 
qualifications for holding a permit included in parts 222, 223, and 
224. These parts set forth qualifications for holding any NOAA permit. 
For example, Sec.  222.303 includes factors that may result in denial 
of a permit, and it incorporates by reference the issuance criteria in 
15 CFR part 904. Part 904, subpart D, regarding permit sanctions and 
denials, enumerates bases for denial of a permit. Such bases include, 
for example,``[t]he commission of any offense prohibited by any statute 
administered by NOAA, including violation of any regulation promulgated 
or permit condition or restriction prescribed thereunder . . .'' 50 CFR 
904.301(a)(1). A proposed permit transferee may be found to be not 
qualified to hold the permit if a basis for denial of a permit exists.
    Comment 8: Commenter believes the existing regulations for permits 
for scientific research or enhancement of propagation or survival are 
irrelevant to enhancement of survival permits issued with Safe Harbor 
Agreements with Assurances or Candidate Conservation Agreements with 
Assurances. Commenter suggests that NMFS conduct a new rulemaking 
procedure to adopt regulations governing issuance of this subset of 
enhancement of survival permits. Commenter suggests that regulations 
address information requirements and approval criteria appropriate for 
these enhancement of survival permits.
    Response: NMFS recognizes that current section 10(a)(1)(A) of the 
ESA permit regulations do not address information requirements or 
issuance criteria for enhancement of survival permits with Safe Harbor 
Agreements with Assurances or Candidate Conservation Agreements with 
Assurances. As noted above, NMFS has not yet adopted regulations to 
implement the joint policy on these types of permits, and it has not 
issued these types of permits. NMFS will seriously consider the 
commenter's suggestion. The comment does not, however, affect the 
adoption of this final rule. This rule pertains only to the 
transferability of permits, not to issuance of permits.
    Comment 9: Commenter believes the Proposed Rule published in the 
Federal Register created confusion concerning which permits are 
transferable and which are not under the new rule.
    Response: NMFS has sought to be very clear in this document which 
permits are transferable and which are not.

Classification

    NMFS has determined that this final rule is consistent with the ESA 
and with other applicable laws.

National Environmental Policy Act

    NOAA's Administrative Order 216-6 (May 20, 1999), allows 
categorical exclusions for ``other categories of actions not having 
significant environmental impacts.'' Specifically, this transfer rule 
can be categorically excluded since this action involves ``regulations 
and guidelines of an administrative, financial, legal, or procedural 
nature(6.03c3(i)).'' Approval of this final rule will not result in 
actions that individually or cumulatively have the potential to pose 
significant impacts on the quality of the human environment. Therefore, 
implementation of this final rule would be exempt from both further 
environmental review and requirements to prepare environmental review 
documents (40 CFR 1508.4).

Executive Order 12866

    This final rule has been determined to be not significant for 
purposes of Executive Order 12866.

[[Page 57973]]

Regulatory Flexibility Act

    Pursuant to the Regulatory Flexibility Act, at the proposed rule 
stage the Chief Counsel for Regulation of the Department of Commerce 
certified to the Chief Counsel for Advocacy of the Small Business 
Administration that this rule would not have a significant economic 
impact on a substantial number of small entities, since the rule would 
reduce costs associated with transfers of land subject to ESA section 
10 permits. No comments were received regarding the economic impacts of 
this rule on small entities.

Paperwork Reduction Act

    This final rule contains a collection-of-information requirement 
subject to the Paperwork Reduction Act (PRA) and which has been 
approved by OMB under control number 0648-0230. Public reporting burden 
for this collection of information is estimated to average 40 hours per 
response, including the time for reviewing instructions, searching 
existing data sources, gathering and maintaining the data needed, and 
completing and reviewing the collection of information. Send comments 
regarding this burden estimate, or any other aspect of this data 
collection, including suggestions for reducing the burden, to NMFS (see 
ADDRESSES) and to OMB at the Office of Information and Regulatory 
Affairs, Office of Management and Budget, Washington, DC. 20503 
(Attention: NOAA Desk Officer).''
    Notwithstanding any other provision of the law, no person is 
required to respond to, nor shall any person be subject to a penalty 
for failure to comply with, a collection of information subject to the 
requirements of the PRA, unless that collection of information displays 
a currently valid OMB Control Number.

Executive Order 13132 - Federalism

    This action has been determined to have no federalism impacts, as 
that term is defined in Executive Order 13132.

List of Subjects

50 CFR Part 222

    Administrative practice and procedure, Endangered and threatened 
species, Exports, Imports, Reporting and recordkeeping requirements, 
Transportation.

50 CFR Part 223

    Endangered and threatened species, Exports, Imports, Marine 
mammals, Transportation.

50 CFR Part 224

    Administrative practice and procedure, Endangered and threatened 
species, Exports, Imports, Reporting and recordkeeping requirements, 
Transportation.

    Dated: September 9, 2002.
William T. Hogarth,
Assistant Administrator for Fisheries National Marine Fisheries 
Service.

    For the reasons set out in the preamble, 50 CFR part 222 is amended 
as follows:

PART 222--GENERAL ENDANGERED AND THREATENED MARINE SPECIES

    1. The authority citation for part 222 continues to read as 
follows:

    Authority: Authority: 16 U.S.C. 1531 et seq.; 16 U.S.C. 742a et 
seq.; 31 U.S.C. 9701. Section 222.403 also issued under 16 U.S.C. 
1361 et seq.

    2. In Sec.  222.305, paragraph (a)(1) is revised and paragraph 
(a)(3) is added to read as follows:


Sec.  222.305  Rights of succession and transfer of permits.

    (a)(1) Except as otherwise provided in this section, permits issued 
pursuant to parts 222, 223, and 224 of this chapter are not 
transferable or assignable. In the event that a permit authorizes 
certain business activities in connection with a business or commercial 
enterprise, which is then subject to any subsequent lease, sale or 
transfer, the successor to that enterprise must obtain a permit prior 
to continuing the permitted activity, with the exceptions provided in 
paragraphs (a)(2) and (a)(3) of this section.
* * * * *
    (3) Incidental take permits issued under Sec.  222.307, and 
enhancement permits issued under Sec.  222.308, as part of a Safe 
Harbor Agreement with Assurances or Candidate Conservation Agreement 
with Assurances, may be transferred in whole or in part through a joint 
submission by the permittee and the proposed transferee, or in the case 
of a deceased permittee, the deceased permittee's legal representative 
and the proposed transferee, provided NMFS determines in writing that:
    (i) The proposed transferee meets all of the qualifications under 
parts 222, 223, or 224 (as applicable) for holding a permit;
    (ii) The proposed transferee has provided adequate written 
assurances that it will provide sufficient funding for the conservation 
plan or other agreement or plan associated with the permit and will 
implement the relevant terms and conditions of the permit, including 
any outstanding minimization and mitigation requirements; and
    (iii) The proposed transferee has provided such other information 
as NMFS determines is relevant to process the transfer.
* * * * *
[FR Doc. 02-23397 Filed 9-12-02; 8:45 am]
BILLING CODE 3510-22-S