[Federal Register Volume 67, Number 192 (Thursday, October 3, 2002)]
[Proposed Rules]
[Pages 62142-62157]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-24932]



[[Page 62141]]

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Part III





Department of Transportation





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Federal Aviation Administration



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14 CFR Part 121, et al.



Corrosion Prevention and Control Program; Development and 
Implementation of Corrosion Prevention and Control Program; Proposed 
Rule and Notice

  Federal Register / Vol. 67, No. 192 / Thursday, October 3, 2002 / 
Proposed Rules  

[[Page 62142]]


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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Parts 121, 129, and 135

[Docket No. FAA-2002-13458; Notice No. 02-16]
RIN 2120-AE92


Corrosion Prevention and Control Program

AGENCY: Federal Aviation Administration, DOT.

ACTION: Notice of proposed rulemaking (NPRM).

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SUMMARY: This document proposes to require that the maintenance or 
inspection programs for all airplanes operated under part 121 of Title 
14, Code of Federal Regulations, all U.S.-registered multiengine 
airplanes operated in common carriage by foreign air carriers or 
foreign persons under 14 CFR part 129, and all multiengine airplanes 
used in scheduled operations under 14 CFR part 135 include FAA-approved 
corrosion prevention and control programs. Such programs are needed 
because existing maintenance and inspection programs may not provide 
comprehensive, systematic measures to prevent and control corrosion. 
These proposals form a part of the FAA's response to legislation 
emanating from the Aging Aircraft Safety Act of 1991. These actions are 
intended to control the detrimental effects of corrosion and the 
resulting airplane structural material loss.

DATES: Comments must be received on or before April 1, 2003.

ADDRESSES: Comments on this proposed rulemaking should be mailed or 
delivered, in duplicate, to: U.S. Department of Transportation Dockets, 
Docket No. FAA-2002-13458, 400 Seventh Street, SW, Room Plaza 401, 
Washington, DC 20590. Comments may also be sent electronically to the 
following Internet address: [email protected]. Comments may be filed 
and/or examined in Room Plaza 401 between 10 a.m. and 5 p.m. weekdays 
expect Federal holidays.

FOR FURTHER INFORMATION CONTACT: Frederick Sobeck, Flight Standards 
Service, Aircraft Maintenance Division (AFS-300), Federal Aviation 
Administration, 800 Independence Avenue, SW., Washington, DC 20591, 
telephone (202) 267-7355.

SUPPLEMENTARY INFORMATION:

Comments Invited

    Interested persons are invited to participate in the making of the 
proposed action by submitting such written data, views, or arguments as 
they may desire. Comments relating to the environmental, energy, 
federalism, or economic impact that might result from adopting the 
proposals in this document also are invited. Substantive comments 
should be accompanied by cost estimates. Comments must identify the 
regulatory docket or notice number and be submitted in duplicate to the 
DOT Rules Docket address specified above.
    All comments received, as well as a report summarizing each 
substantive public contact with FAA personnel concerning this proposed 
rulemaking, will be filed in the docket. The docket is available for 
public inspection before and after the comment closing date.
    All comments received on or before the closing date will be 
considered by the Administrator before taking action on this proposed 
rulemaking. Comments filed late will be considered as far as possible 
without incurring expense or delay. The proposals in this document may 
be changed in light of the comments received.
    Commenters wishing the FAA to acknowledge receipt of their comments 
submitted in response to this document must include a pre-addressed, 
stamped postcard with those comments on which the following statement 
is made: ``Comments to Docket No. FAA-2002-13458.'' The postcard will 
be date stamped and mailed to the commenter.

Availability of Rulemaking Documents

    You can get an electronic copy using the Internet by taking the 
following steps:
    (1) Go to the search function of the Department of Transportation's 
electronic Docket Management System (DMS) Web page (http://dms.dot.gov/search).
    (2) On the search page type in the last four digits of the Docket 
number shown at the beginning of this notice. Click on ``search.''
    (3) On the next page, which contains the Docket summary information 
for the Docket you selected, click on the document number of the item 
you wish to view.
    You can also get an electronic copy using the Internet through the 
Office of Rulemaking's Web page at http://www.faa.gov/avr/arm/nprm.cfm?nav=nprm or the Federal Register's Web page at http://www.access.gpo.gov/su_docs/aces/aces140.html.
    You can also get a copy by submitting a request to the Federal 
Aviation Administration, Office of Rulemaking, ARM-1, 800 Independence 
Avenue SW., Washington, DC 20591, or by calling (202) 267-9680. Make 
sure to identify the docket number, notice number, or amendment number 
of this rulemaking.

Background

    Corrosion is a natural phenomenon that attacks metal by 
electrochemical action and converts the metal into a metallic compound, 
such as an oxide, hydroxide, or sulfate. Corrosion occurs because of 
the tendency for metals to return to their natural state. Corrosion, if 
left unchecked, will progressively degrade an airplane's strength until 
its structure can no longer sustain its design load.
    In addition, a detrimental interaction occurs when both corrosion 
and metal fatigue are present. Metal fatigue is the initiation and 
propagation of cracks because of repeated stresses. Small amounts of 
corrosion may cause the formation of fatigue cracks by introducing 
areas of stress concentration. In turn, once the cracks begin, moisture 
and corrosion products can collect at the crack sites, accelerating 
both the corrosion and fatigue processes.
    Although corrosion inhibitors and other protective coatings are 
applied to airplane metal surfaces during the manufacturing process, 
over time erosion by sand and/or rain and mechanical wear will remove 
the protective coatings. Therefore, in order to prevent corrosion, a 
constant cycle of cleaning, inspection, and application of corrosion 
inhibitors must be followed.
    On April 28, 1988, an in-flight accident occurred when a large 
transport airplane lost approximately 18 feet of the upper fuselage. 
The National Transportation Safety Board (NTSB) investigation revealed 
that the probable cause of this accident was the failure of the 
operator to detect the presence of skin disbonding, with resulting 
corrosion and metal fatigue, that ultimately led to the separation of 
the aircraft's skin and structure. The NTSB observed numerous areas of 
corrosion on the accident airplane and on other airplanes in the 
operator's fleet. The NTSB noted that the operator did not have a 
programmatic approach to corrosion prevention and control. In its 
accident investigation report (NTSB/AAR-89/03; Recommendation No. A-89-
59), the NTSB recommended that the FAA ``develop a model program for a 
comprehensive corrosion prevention and control program (CPCP) to be 
included in each operator's approved maintenance program.''
    Prior to 1988, the FAA lacked compelling evidence that existing

[[Page 62143]]

maintenance and inspection programs were not controlling corrosion to a 
safe level. Although many airplane manufacturers had provided 
maintenance programs for corrosion prevention and control, the FAA saw 
no reason to mandate such programs.
    After the 1988 accident, the FAA sponsored an aging fleet 
conference at which the Air Transport Association of America (ATA) and 
the Aerospace Industries Association of America (AIA) committed to 
identifying and implementing procedures to ensure continued structural 
airworthiness of aging transport category airplanes. As a result, an 
Airworthiness Assurance Task Force (AATF) was established that included 
aircraft operators, manufacturers, and regulatory authorities. An 
immediate objective of the AATF was to sponsor airplane model-specific 
working groups to identify aging fleet structural maintenance 
requirements. The working groups were tasked to: 1. Select service 
bulletins to be recommended for mandatory implementation; 2. develop 
baseline corrosion prevention and control programs; 3. review 
supplemental structural inspection programs; 4. assess repair quality; 
and 5. review maintenance programs.
    Task 2 resulted in the FAA issuing Airworthiness Directives (ADs) 
that mandated specific corrosion prevention and control programs for 
the following 11 airplane models: the Airbus A-300, British Aerospace 
BAC 1-11, Boeing 707/720, 727, 737, and 747, Fokker F-28, Lockheed L-
1011, and McDonnell Douglas DC-8, DC-9, and DC-10. The FAA issued the 
corrosion ADs for the 11 airplane models based on the finding that the 
initiation and spreading of corrosion in the metallic structures of 
those airplanes is an ``unsafe condition,'' as that term is used in 
part 39. The airplanes covered by the ADs incorporated CPCPs of the 
kind that would be required by this NPRM.
    Partly in response to the 1988 accident, legislation was enacted to 
address aging aircraft issues. This broadly worded Aging Aircraft 
Safety Act of 1991 (AASA), re-codified now at 49 U.S.C. 44717, 
instructed the Administrator to ``initiate a rulemaking proceeding for 
the purpose of issuing a rule to assure the continued airworthiness of 
aging aircraft.'' The rule issued pursuant to the AASA must require:
    [sbull] The Administrator to inspect air carrier aircraft, used in 
air transportation, and the maintenance records of those aircraft, to 
determine that the aircraft are in safe condition and properly 
maintained for operation in air transportation.
    [sbull] The Administrator's inspection and records review as part 
of the ``heavy maintenance check'' of the aircraft.
    [sbull] Each air carrier to make available each aircraft used in 
air transportation, and its records.
    [sbull] Each air carrier to demonstrate that maintenance of the 
age-sensitive parts and components of each aircraft used in air 
transportation, has been adequate and timely enough to ensure the 
highest degree of safety.
    The AASA also instructed the Administrator to establish a program 
to verify air carrier compliance with their FAA-approved maintenance 
programs, and a program to train FAA inspectors and engineers to 
conduct auditing inspections for corrosion and metal fatigue in those 
aircraft.
    Thus, corrosion prevention and control fit within the relatively 
broad scope of the AASA. The main thrust of the AASA is addressed in 
the Aging Airplane Safety proposal, published in the Federal Register 
on April 2, 1999 (64 FR 16298). That proposal would require, among 
other things, damage-tolerance-based inspection programs for most air 
carrier aircraft used in air transportation.
    This proposal would impose requirements to prevent the spreading of 
corrosion in all other airplanes operated under part 121, all other 
U.S.-registered multiengine airplanes operated under part 129, and all 
other multiengine airplanes in scheduled operations under part 135. In 
other words, most of the airplanes not currently covered by AD. By this 
proposal, the FAA has not made a finding that corrosion need not be 
addressed in the airplanes that are excluded in this proposal, i.e., 
airplanes of the affected models operated under parts 91, or 125, or 
operated on-demand under part 135. At this time, however, the FAA has 
not evaluated all of the kinds of requirements that could be imposed to 
address corrosion in those airplanes, or all of the costs that would be 
attributable to such requirements.
    The current CPCP ADs and the adoption of this proposed rule would 
differ in noticeable ways. First, each AD requires a CPCP for the 
affected model of airplane, regardless of the part under which the 
airplane is operated. As explained further in this proposal, this 
proposal does not apply to airplanes operated under parts 91, 125, and 
airplanes operated on-demand under part 135.
    Second, unlike the ADs, the rules proposed in this NPRM do not 
specify the detailed provisions, including special reporting 
requirements, that would be contained in an operator's FAA-approved 
CPCP. Nevertheless, the proposal provides that an acceptable CPCP would 
contain procedures to assure that, whenever corrosion exceeding Level 1 
is found in any area, the operator notify the FAA and, in addition, 
implement an FAA-approved means of reducing future findings of 
corrosion in that area to Level 1 or better.
    A measure of the effectiveness of a CPCP is the level of corrosion 
damage found on primary structure during repeat scheduled inspections. 
Level 1 corrosion is corrosion damage that occurs between successive 
inspections and is local and can be reworked or blended-out within 
allowable limits as defined by the manufacturer or the FAA. This 
definition provides the FAA and industry with a quantifiable measure 
for determining the effectiveness of the CPCP. The FAA believes that 
such monitoring and notification is important and necessary to achieve 
one of the goals of this proposal, i.e., the prevention of the unsafe 
condition of spreading metallic corrosion that prompted the 11 ADs 
discussed above in the fleet of newer airplanes.
    Concurrently with this proposal, the FAA is publishing an advisory 
circular (AC), ``Development of Corrosion Prevention and Control 
Programs'' to assist small entities and other affected parties in 
developing CPCP programs that will be acceptable to the FAA. This AC 
would contain the detailed provisions necessary for a successful 
program. In soliciting comments on the draft AC, the FAA seeks comments 
on the development and implementation of corrosion prevention and 
control programs.
    In this proposal, the FAA is proposing a single set of rules that 
would apply to all the specified types of airplanes used in air carrier 
service. This approach would be administratively preferable to ADs 
issued to specific airplane models and generally provides better notice 
to the public concerning the types of inspections and maintenance that 
will be required to prevent corrosion in air carrier airplanes.

A Typical CPCP AD

    A typical CPCP AD requires the operator to incorporate a baseline 
CPCP into its maintenance or inspection program. The baseline CPCP, 
developed by the manufacturer for all operators of a particular model 
of airplane, consists of corrosion prevention and control tasks, 
definitions of corrosion levels, compliance times (implementation 
thresholds and repeat intervals) and

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reporting requirements. After an operator has incorporated a baseline 
CPCP into its maintenance or inspection program, the ADs allow 
adjustment to the required repeat intervals of the CPCP, provided the 
maintenance program is controlling corrosion to an acceptable level. 
The FAA has determined that corrosion damage that occurs between 
successive inspections and is local and can be reworked or blended-out 
within allowable limits as defined by the manufacturer or the FAA, is 
an acceptable level of corrosion. These allowable limits of corrosion 
damage are defined as Level 1 Corrosion.

Existing Requirements

    Sections 23.1529 and 25.1529 require that applicants for type 
certificates and changes to type certificates for normal, utility, 
acrobatic, commuter, and transport category airplanes prepare 
Instructions for Continued Airworthiness (ICA's) for those airplanes, 
as applicable. Appendix G to part 23 and Appendix H to part 25 
currently specify the required content of those instructions for newly 
type-certificated airplanes. The requirements that applicants for type 
certificates (TC) prepare ICA's for their airplanes first became 
effective on October 14, 1980. ICA's were not required for airplanes 
type certificated before that date. Since January 28, 1981, any person 
who holds an airplane type certificate or supplemental type certificate 
(STC) for which the application was made after that date, is required 
to furnish at least one set of the ICA for each type of airplane to the 
owner upon its delivery, or upon issuance of the first standard 
airworthiness certificate, for each type of airplane, whichever occurs 
later. The holder of the TC or STC is also required to make the ICA 
available to any other person required to comply with terms of the ICA.
    The ICA must include an airplane maintenance manual or a section to 
be included in the airplane maintenance manual, maintenance 
instructions, and a segregated and clearly distinguishable section 
titled the Airworthiness Limitations. The maintenance instructions must 
contain an inspection program that includes the frequency and extent of 
the inspections necessary to provide for the continued airworthiness of 
the airplane. Compliance with Appendices G and H requires the applicant 
to include maintenance schedules, and information required to apply 
protective treatments to the structure following the inspection. While 
the ICA provides owners and operators with useful information to assist 
them in preventing and controlling corrosion, they may not provide 
comprehensive, systematic measures for carrying out the inspections and 
necessary maintenance instructions.

Transport Category Airplanes

    Under existing Sec.  25.571, an evaluation of the strength, detail 
design, and fabrication must show that catastrophic failure due to 
corrosion will be avoided throughout the operational life of the 
airplane. Based on the evaluation, corrosion inspections or other 
procedures necessary to prevent catastrophic failure must be included 
in the Airworthiness Limitations Section of the ICA. Other corrosion 
inspections are included in the maintenance instructions of the ICA in 
accordance with Appendix H of part 25.

Small Airplanes and Commuter Category Airplanes

    Requirements similar to those in Sec.  25.571 apply to airplanes 
certificated to the damage tolerance requirements of Sec.  23.573(b) 
and Sec.  23.574. Similar to the transport category airplane 
requirements, any corrosion inspections of critical structure 
identified during the showing of compliance with those requirements 
must be listed in the limitations section of the ICA as provided in 
Sec.  23.575. Other corrosion inspections are included in the 
maintenance instructions of the ICA in accordance with Appendix G of 
part 23.
    The FAA has determined that these existing requirements have not 
always resulted in a comprehensive and systematic CPCP for either 
transport, small, or commuter category airplanes. This proposed 
rulemaking would specifically require a systematic CPCP for certain 
airplanes operating under parts 121, 129, and 135.

General Discussion of the Proposal

    This proposed rule responds to the provisions of 49 U.S.C. 44717, 
which requires the Administrator to ``prescribe regulations that ensure 
the continuing airworthiness of aging aircraft * * *'' and is modeled 
after the CPCP ADs. As a result of requirements set forth in 49 U.S.C. 
44717, the FAA proposes to prohibit the operation of certain airplanes 
in scheduled operations unless their maintenance or inspection programs 
include a CPCP. All airplanes operating under part 121, all U.S.-
registered multiengine airplanes operating under part 129, and all 
multiengine airplanes conducting scheduled operations under part 135 
would be affected. The airplanes affected by this proposed rule 
transport a significant portion of the passengers carried in scheduled 
passenger service and are the most prevalent airplanes operated in such 
service.
    This notice does not propose requirements for rotorcraft or single-
engine airplanes, nor does it propose requirements for on-demand 
passenger or cargo-carrying operations under 14 CFR part 135. In a 
future notice or notices, the FAA will propose aging aircraft 
requirements necessary to cover the operation of all the other aircraft 
used by operators to provide air transportation. For the purpose of 
developing those proposals, the FAA may consider the information (e.g. 
documents in the public docket) used to develop the rule proposed in 
this notice. It is possible that future proposals could be similar to 
the requirements proposed in this notice; however, because of the 
differences in the designs, operations, and maintenance of those 
aircraft, differences between this notice and the future proposals are 
likely.
    The scope of this proposal includes the preponderance of the kinds 
of aircraft the Congress intended to cover under the Aging Aircraft 
Safety Act (AASA). By this notice, the FAA also solicits comments on 
the possibility or practicality of future requirements for CPCPs on 
aircraft not covered by this proposal.
    Congress also instructed the Administrator to encourage governments 
of foreign countries and relevant international organizations to 
develop programs addressing aging aircraft concerns. Most foreign air 
carriers and foreign persons engaged in common-carriage operations have 
maintenance program requirements adopted by their governments. By 
including part 129 in this proposed rule, foreign air carriers and 
foreign persons operating U.S.-registered multiengine aircraft within 
or outside the United States would be required to include a CPCP in 
their maintenance programs. This action forms a portion of the FAA's 
response to the requirements in the AASA to help ensure the continued 
airworthiness of aging U.S.-registered airplanes operated worldwide.

Operator's Corrosion Prevention and Control Program

    This proposal would require each operator to incorporate a baseline 
CPCP into its existing maintenance or inspection program. The operator 
can then modify the corrosion prevention and control tasks, and 
compliance times (implementation thresholds and repeat intervals), 
based upon service experience with its particular operation, so long as 
the operator's CPCP

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maintains corrosion to Level 1. Each operator's CPCP should include 
procedures for assuring that each airplane added to the operator's 
certificate after its CPCP is approved has completed all overdue 
inspections and tasks before the aircraft is operated in passenger 
service.

Baseline Corrosion Prevention and Control Programs

    A baseline corrosion prevention and control program is designed to 
control corrosion so that the damage does not exceed Level 1. Baseline 
CPCPs contain corrosion prevention and control tasks, definitions of 
corrosion levels, compliance times (implementation thresholds and 
repeat intervals) and procedures to modify the program when corrosion 
damage exceeds Level 1. The reporting requirements that are listed in 
the CPCP ADs would not be changed by this proposal. Current reporting 
requirements in parts 121, 129, and 135 are unchanged.
    The baseline program is developed for a specific type design of 
airplane and is usually developed by the manufacturer. If the 
manufacturer does not provide a program that meets the requirements in 
this proposed rule, each operator would be required to develop a 
program and present it to the FAA for approval. One proposed method of 
developing a program is identified in proposed Advisory Circular XX-
XXX.
    The FAA is aware that the manufacturer or operators of some 
airplanes affected by this proposed rule may choose not to develop a 
CPCP. Airplanes that do not have a CPCP would not be eligible for 
operation under part 121, and certain airplanes would be prohibited 
from operating under parts 129 or 135 without a CPCP after the dates 
specified in the proposal. For airplanes affected by this proposal, a 
baseline program would need to be developed and any corrosion 
inspections due would have to be completed. Similar airplanes added to 
the operator's certificate, subsequently establishment of the baseline 
programs would need to have all overdue corrosion inspections completed 
prior to being eligible to enter operations affected by this proposal.

Implementation

    This proposed rule would require a CPCP to be in place two years 
after the effective date of the final rule. The FAA realizes that for 
some airplanes, the implementation thresholds for certain areas will 
have been exceeded by the time the rule becomes effective. Therefore, 
the proposed rule contains a provision for areas that have exceeded 
their implementation thresholds prior to two years after the effective 
date of the final rule. This provision would require the operator to 
develop an implementation schedule that would result in the completion 
of all overdue corrosion prevention and control tasks no later than 
four years after the effective date of the final rule.

Section-by-Section Analysis

Section 121.376

    Proposed paragraph (a) would specifically require each operator to 
incorporate an FAA-approved CPCP into its maintenance or inspection 
program within two years of the effective date of the rule.
    Proposed paragraph (b) would specify that a baseline corrosion 
prevention and control program be designed to control corrosion so that 
the damage does not exceed Level 1.
    Proposed paragraph (b) would also require that the CPCP include 
corrosion prevention and control tasks, the definition of Level 1 
corrosion, compliance times (implementation thresholds and repeat 
intervals) and procedures to modify the program when corrosion damage 
exceeds Level 1.
    Proposed paragraph (c) would contain a provision for airplanes that 
have exceeded their implementation thresholds prior to two years after 
the effective date of the final rule. This provision would require each 
operator of such an airplane to develop an implementation schedule that 
would result in the completion of those corrosion prevention and 
control tasks no later than four years after the effective date of the 
final rule.

Section 121.376a

    Proposed Sec.  121.376a would define Level 1 corrosion, discussed 
in further detail below.

Section 129.1

    The proposal would revise paragraph (b) to add a reference to Sec.  
129.35.

Section 129.24

    Proposed Sec.  129.24 would define Level 1 corrosion, discussed in 
further detail below.

Section 129.35

    Proposed paragraph (a) would require each foreign air carrier or 
foreign person that operates an U.S.-registered multiengine airplane in 
common carriage to incorporate a FAA-approved CPCP into the maintenance 
or inspection program for each such airplane within two years of the 
effective date of the rule.
    Proposed paragraph (b) would specify that a baseline CPCP is 
designed to control corrosion such that the damage does not exceed 
Level 1.
    Proposed paragraph (b) would also require that the CPCP include 
corrosion prevention and control tasks, the definition of Level 1 
corrosion, compliance times (implementation thresholds and repeat 
intervals) and procedures to modify the program when corrosion damage 
exceeds Level 1.
    Proposed paragraph (c) would contain a provision for airplanes that 
have exceeded their implementation thresholds prior to two years after 
the effective date of the final rule. This provision would require each 
operator of such an airplane to develop an implementation schedule that 
would result in the completion of those corrosion prevention and 
control tasks no later than four years after the effective date of the 
final rule.

Section 135.424

    Proposed paragraph (a) would require each operator of a multiengine 
airplane in scheduled service to incorporate a FAA-approved CPCP into 
the maintenance or inspection program for each such airplane within two 
years of the effective date of the rule.
    Proposed paragraph (b) would specify that a baseline CPCP is 
designed to control corrosion such that the damage does not exceed 
Level 1.
    Proposed paragraph (b) would require that the CPCP include 
corrosion prevention and control tasks, the definition of Level 1 
corrosion, compliance times (implementation thresholds and repeat 
intervals) and procedures to modify the program when corrosion damage 
exceeds Level 1.
    Proposed paragraph (c) would contain a provision for airplanes that 
have exceeded their implementation thresholds prior to two years after 
the effective date of the final rule. This provision would require each 
operator of such an airplane to develop an implementation schedule that 
would result in the completion of those corrosion prevention and 
control tasks no later than four years after the effective date of the 
final rule.

Section 135.426

    Proposed Sec.  135.426 would define Level 1 corrosion.

Definitions

    The purpose of a corrosion prevention and control program is to 
control corrosion such that the damage does not exceed Level 1. A 
measure of the effectiveness of a CPCP is the level of corrosion damage 
found on primary

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structure during repeat scheduled inspections. In order for the FAA to 
have some measurable quantity by which to gauge the effectiveness of an 
individual operator's CPCP, the following definition applies:
    Level 1 Corrosion is (1) corrosion damage occurring between 
successive inspections that is local and can be re-worked/blended-out 
within allowable limits as defined by the manufacturer or the FAA; (2) 
corrosion damage that is local but exceeds allowable limits and can be 
attributed to an event not typical of the operator's usage of other 
airplanes in the same fleet; or (3) corrosion damage that operator 
experience over several years has demonstrated to be only light 
corrosion between successive prior inspections but that the latest 
inspection shows that cumulative blend-outs now exceed the allowable 
limits. Level 2 and 3 corrosion along with specific procedures to be 
followed when Level 1 is exceeded will be included in the draft AC that 
will be available when this proposal is published.
    An operator's CPCP would contain corrosion prevention and control 
tasks, the definition of Level 1 corrosion, compliance times 
(implementation thresholds and repeat intervals) and procedures to 
modify the program when corrosion damage exceeds Level 1. The following 
definitions apply:
    Corrosion Prevention and Control Task: A corrosion prevention and 
control task usually consists of: 1. Removing equipment and interior 
furnishings to allow access to the area, 2. cleaning the area, 3. 
conducting inspections of all areas (Note: nondestructive inspections 
or visual inspections may be necessary), 4. removing all corrosion, 
evaluating damage, and repairing damaged structure, 5. unblocking 
drainage holes, 6. applying corrosion preventive compound(s), and 7. 
reinstalling dry insulation blankets.
    An Implementation Threshold for a given area is the airplane age 
(years since the initial issuance of the certificate of airworthiness) 
at which the CPCP should be implemented in the affected area.
    A Repeat Interval is the calendar time period between successive 
corrosion task accomplishments.

Regulatory Impact

Executive Order 12866 and DOT Regulatory Policies and Procedures

Economic Evaluation Summary
    Proposed changes to Federal regulations must undergo several 
economic analyses. First, Executive Order 12866 directs that each 
Federal agency shall propose or adopt a regulation only upon a reasoned 
determination that the benefits of the intended regulation justify its 
costs. Second, the Regulatory Flexibility Act of 1980 requires agencies 
to analyze the economic impact of regulatory changes on small entities. 
Third, the Trade Agreements Act (19 U.S.C. 2531-2533) prohibits 
agencies from setting standards that create unnecessary obstacles to 
the foreign commerce of the United States. In developing U.S. 
standards, this Trade Act also requires the consideration of 
international standards and, where appropriate, that they be the basis 
of U.S. standards. And fourth, the Unfunded Mandates Reform Act of 1995 
requires agencies to prepare a written assessment of the costs, 
benefits and other effects of proposed or final rules that include a 
Federal mandate likely to result in the expenditure by State, local or 
tribal governments, in the aggregate, or by the private sector, of $100 
million or more annually (adjusted for inflation.
    In conducting these analyses, the FAA has determined this rule:
    (1) Has benefits which do justify its costs, is a ``significant 
regulatory action'' as defined in the Executive Order and is 
``significant'' as defined in DOT's Regulatory Policies and Procedures;
    (2) Would have a significant impact on a substantial number of 
small entities;
    (3) Would not constitute barriers to international trade; and
    (4) Does not impose an unfunded mandate on state, local, or tribal 
governments, or on the private sector. These analyses, available in the 
docket, are summarized below.
    Description of Costs. The primary costs of the proposed rule would 
be borne by those scheduled operators of multiengine airplanes not 
currently subject to a mandatory corrosion prevention and control 
program. Additional costs would also be incurred by manufacturers who 
participate in the assessment and development of the corrosion programs 
for the affected airplane models, but this evaluation assumes that all 
such costs would eventually be passed through to the operators. The FAA 
itself would incur relatively minor costs for reviewing and approving 
(1) the corrosion prevention and control programs, and (2) the 
incorporation of these new procedures into the existing maintenance and 
inspection programs.
    Note that the attributed costs of this proposal do not include the 
expense of making major repairs or modifications that may be found 
necessary during the inspections mandated by this proposal. While the 
agency recognizes that such repairs may constitute a significant 
expense, their costs are not attributed to this proposed rule because 
existing FAA regulations require that repairs be made as found to be 
necessary to assure the continued airworthiness of the airplane.
    The methodology used in the evaluation first computes the costs 
that would be incurred if it were economically viable for all of the 
airplanes in the affected fleet to meet the requirements of the 
proposed rule. Based on these costs, and their comparison to the 
approximate fleet value, the methodology later estimates the numbers of 
airplanes and models where compliance would not actually be 
economically viable, and where instead, the airplanes would likely be 
retired from scheduled service.
    Approximately 7,100 airplanes were identified as being subject to 
the proposed rule. For the majority of these airplanes, the proposal 
would not generate any additional costs, since the subject airplanes 
already comply with airworthiness directives that parallel the 
proposal. Some 2,900 airplanes would be affected by the proposal in one 
manner or another, and as such would incur costs.
    In projecting the cost of the proposed rule, development cost 
factors were estimated for each airplane model. These factors, ranging 
from zero to one, represent the proportion of full CPCP development 
costs that would be incurred for each airplane model group. The factors 
account for the fact that full compliance programs are in place for 
some models (factor = 0) and that the development costs for some other 
models would be reduced to less than 1 either due to their similarities 
to other models or because some models have partially compliant 
programs. The factors also account for the fact that airplanes 
certificated under existing Sec.  25.571, amendment 45 or later, are 
already required to undergo an evaluation of their strength, detail 
design, and fabrication to show that failure due to corrosion will be 
avoided throughout the operational life of the airplane.\1\ For these 
newer models, development factors of .1 were assigned to represent the 
estimated additional effort (equal to one-tenth of a completely 
incremental CPCP evaluation and development) that would be necessary to 
comply with the proposed rule. Taken together, the

[[Page 62147]]

various cost factors produce an estimated cost equivalence of 
approximately 47 full CPCP development efforts among the 88 model 
groups that were identified.
---------------------------------------------------------------------------

    \1\ Similar requirements exist under Sec.  23.574 for commuter 
category airplanes, and damage tolerance requirements related to the 
effects of corrosion for both composite and metallic airframe 
structure are found in Sec. Sec.  23.573(a) and (b), respectively.
---------------------------------------------------------------------------

    The cost methodology employs a three step functional estimate of 
the time needed to develop each CPCP. First, the nominal number of 
development hours is estimated as a function of the average maximum 
takeoff weight (MTOW) for each model.

Eq. 1. Hours = 2,296 + (.04 x MTOW)

    This equation was derived from a two-point linear plot of the 
estimated costs expended to develop the CPCP for two existing airplane 
models (the DC-9 and the Piper Navajo). The results of the Eq. 1 
estimates were then multiplied by the development factors to account 
for the reduced development efforts for similar or partially compliant 
models described above. Finally, a third factor (described below) was 
applied to account for the possibility that a CPCP would not be 
developed for an airplane model where it was reasonably expected that 
the airplanes of that model would have been retired before the 
effective period of the proposed rule.
    The hours for development were converted into cost estimates for 
each model by applying a fully burdened engineering cost rate of $95 
per hour for CPCP development. This produced a cost per model ranging 
between $32,000 and $427,000. The estimated development cost for all 
models totals to $10.4 million, or $7.9 million expressed in present 
value terms.
    It was also necessary to estimate the FAA's costs to review and 
approve the CPCP's described above. The evaluation employs a simple 
factor of 80 hours of review per newly developed CPCP, at a burdened 
cost rate of $55 per hour. This produces estimated costs of $4,400 per 
model and for the affected fleet the total cost is $246,400, or in 
present value terms $141,171.
    Similar to the ``development'' cost factors described above, the 
evaluation also employed ``implementation'' cost factors for each 
model. The implementation factors also range between zero and one, and 
constitute the expected proportions of full incremental implementation 
effort that would be caused by the proposal for each model. In addition 
to accounting for the existence of fully or partially compliant CPCP's 
themselves, the implementation factors also account for those cases 
whereby an industry developed CPCP may exist for a given airplane 
model, but either its implementation is not currently mandated by FAA 
direction, or the associated work level would be increased by this 
proposal. The evaluation projects the work load equivalence of full 
incremental implementation in 60 of the 88 affected model groups.
    The first stage of implementation for the proposed rule would be 
incorporating the model-specific CPCP into an operator's maintenance or 
inspection program. Data were cross-tabulated to determine the 
distribution and number of unique combinations of operators and subject 
airplane models to estimate the number of new CPCP's that would need to 
be incorporated into existing operator programs (487 operator-model 
combinations.) In turn, the expected cost of these CPCP incorporations 
for the operators of each model were computed by multiplying the number 
of operator-model combinations, by an estimated 40 hours incremental 
work per incorporated program, and by a unit labor rate of $55 per 
hour. The total expected cost of this work, across all operator-model 
combinations, sums to $609,400, or $434,494 in present value.
    Similar to their review of the actual CPCP's, FAA personnel would 
also need to review and approve the incorporation of the CPCP's into 
the existing maintenance and inspection programs of the operators. The 
calculation of these costs parallels the operator cost calculation from 
above with the exception that only 8 hours of review work would be 
necessary per incorporation. These ``second'' FAA review costs sum to 
$121,880, or $79,683 in present value. FAA review costs are expected to 
be incurred in 2003.
    Next, the calculation of the actual operator inspection activities 
that would result from the CPCP's are computed. The evaluation assumes 
that the proposed rule would become final at the end of the year 2000, 
that the required new CPCP's would be developed by the end of the year 
2002, and that inspections and maintenance, where scheduled, would 
start in the year 2003. The evaluation uses a 20-year study period 
(from the effective date of the rule) and, therefore, assesses expected 
costs through the year 2020. The inspections for any particular 
airplane would not begin before the time specified in the CPCP for that 
model, and the initiation of work under the CPCP's would vary by 
airplane model and by individual airplane structure. This evaluation 
assumes that the preponderance of corrosion related inspection and 
maintenance work under the proposed rule would begin in the tenth year 
of an airplane's operation. The evaluation further assumes that the 
airplanes under this proposal would not be retired from service until 
age 35.
    The four parameters described above are used to estimate the 
projected number of years that inspections under this proposal would be 
conducted within the study period. For each airplane model, this period 
is calculated as the intersection of: (1) The years included within the 
study period, and (2) the years where the average age of the affected 
airplanes would be between 10 and 35 years old.
    The projected, average number of years that each model would be 
inspected under the program multiplied by the number of affected 
airplanes in each model produces the expected airplane-years of program 
coverage under the proposal, by model. This figure, in turn, is 
multiplied by the projected number of hours of work per year that the 
CPCP would require, and by the cost of labor per hour for that work, to 
produce the estimated cost of implementation. The assumed unit cost 
rate is $55 per hour. The projected annual number of work hours for 
each airplane under the proposal is computed as a function of airplane 
size (maximum takeoff weight).

Eq. 2. Hours = 88 + (.0006 x MTOW)

    This functional estimate was derived from a linear regression of 
the airplane weights and the annual work-hour projections included in 
13 CPCP airworthiness directives (the original eleven plus two 
subsequent directives for the Casa C-212 and the Fokker F-27) mandating 
industry developed corrosion programs. The ``hours per airplane per 
year'' results are the product of the functional estimate in Equation 
2, above, multiplied by the implementation factors described 
previously. Finally, the projected inspection costs over the study 
period are computed as the product of: (1) The numbers of airplane-
years of coverage under the program, (2) the work hours per airplane 
per year, (3) a unit cost factor of $55 per hour for the inspection and 
maintenance work, and (4) a factor of 1.2 to account for the 20 percent 
overhead of paperwork and record keeping. These computations forecast a 
total of $155 million ($64.5 million in present value) in inspection 
costs through the year 2020.
    In addition to the actual costs of inspecting the airplanes, costs 
can also be attributed to the incremental downtime that would be 
necessitated by the work required under the proposal. The evaluation 
assumes that each 40 hours of work necessitated by the CPCP

[[Page 62148]]

requirement would require 1 additional day of airplane downtime. The 
projected additional down-days are computed as the product of: (1) The 
number of airplane years in the program, (2) the work hours per 
airplane per year, and (3) the assumed unit factor of 1 down-day per 40 
hours of added work. Under these assumptions, the evaluation projects 
58,658 days of additional downtime for the affected fleet throughout 
the twenty-year study period as a result of the work attributed to the 
proposal.
    The economic valuation of this downtime was computed under the 
assumption that the average productive return on capital is equal to 7 
percent of the value of that capital, per year. Accordingly, the 
downtime costs were calculated as the product of: (1) The number of 
additional downtime days that would be required, divided by 365 days 
per year, (2) the estimated economic value of the fleet for each model, 
calculated at the median program year for that model, and (3) the 7 
percent per year assumed rate of return on capital. These costs total 
$21.5 million, or in terms of present value $8.6 million.
    Next, the present values (7 percent discount rate) of the four 
component industry costs were calculated. For computational expediency, 
the present value calculations assume that all development costs occur 
in the year 2002, operator incorporation costs occur in the year 2003, 
and both the inspection and downtime costs occur in the median year of 
the inspection program for each model. The present value of the total 
expected cost of the proposed rule to industry is $81.5 million, not 
including the FAA review costs described earlier.

                   Present Value Cost to the Industry
------------------------------------------------------------------------
                                                                Total
 Development   Operator cost    Inspection   Downtime cost    Industry
     cost                          cost                         cost
------------------------------------------------------------------------
  $7,913,985       $434,494    $64,524,942     $8,626,515   $81,499,936
------------------------------------------------------------------------

    As noted in the introductory remarks of the cost section, the 
calculations described above assume that all of the subject airplanes 
would comply with the CPCP requirements of the proposed rule. At this 
point, however, the evaluation recognizes that it may not, in fact, be 
economical to develop and implement a CPCP for some older airplane 
models with very few subject airplanes. In order to account for this 
possibility, the evaluation compares the expected industry costs of the 
rule with the estimated fleet values of the affected models. For 11 
models, the program costs are projected to be prohibitive and the 
expected compliance costs for the model are removed from the program 
implementation costs, and instead, a reduction of 50 percent of the 
value of the airplanes in that model is assigned as the attributed cost 
of the proposed rule for that model. Under this scenario, the present 
value costs to industry of the proposed rule would consist of $78.7 
million in implementation costs and $1.3 million in costs resulting 
from reductions in airplane value due to a forecast economic inability 
to comply with the proposal. The total present-value cost of the 
proposed requirement to industry is projected at $80.0 million. The 
present value of the FAA cost for review is estimated at $220,885.
    In addition to the proposed requirements for existing airplane 
models, the proposal would also require baseline corrosion prevention 
and control programs for future, newly certificated airplane models 
that would likely be marketed for scheduled passenger operations. For 
the purpose of example, the evaluation assumes one new certification 
per year between the effective date of the proposed rule and the end of 
the evaluation study period. In order to represent the likely sizes of 
the airplanes that might be certificated, the existing airplane models 
evaluated above were sorted by maximum takeoff weight, and were grouped 
into 18 classifications. The average weight of the airplanes in each of 
these 18 classes was then computed to represent the likely size of 
airplanes that would be certificated in each of the 18 years of the 
study period. In an effort to remove the bias of the order in which the 
various size airplanes were presumed to be certificated over time, the 
18 airplane weight classes were assigned randomly across the 18 study 
years.
    As noted above, the existing certification standards for all part 
25 models and for certain part 23 models (commuter category and 
composite materials airplanes) require that future airplane models 
undergo an evaluation of their strength, detail design, and fabrication 
to show that failure due to corrosion will be avoided throughout the 
operational life of the airplane. As previously described, a 
development factor of .1 was assigned to the existing airplane models 
that were certificated to these standards, and in a parallel fashion, 
one-tenth of a full development cost is also assigned to the affected 
future airplane models. It should be noted that the existing 
certification procedures that would cause this reduced incremental 
impact are not required for metallic (non-composite material) airplanes 
in the normal, utility, or acrobatic categories for part 23. The 
evaluation assigns to these airplanes (weighing 12,500 pounds or less) 
a CPCP factor of .5, which recognizes that: (1) In the absence of this 
rule, these airplanes would not be substantially compliant with a CPCP 
requirement, but (2) substantial savings (one-half) in CPCP development 
would be realized as the development of the corrosion program would be 
included in the development of the airplane itself, rather than 
retroactively considered for an existing model.
    The evaluation also recognizes that not all future airplane models 
will likely be marketed or used for scheduled passenger operations. In 
the absence of model-specific information, the evaluation assumes that 
future models under 6,000 pounds (2 of the 18 models considered here) 
would not incur additional costs as a result of this rule.
    Returning to the computations, the estimated hours necessary to 
develop a CPCP for each airplane model in the example forecast were 
computed using the same formula that was used above (Eq 1; Hours = 
2,296 + (.04 x MTOW)) with the result being multiplied by a factor of 
either .1 or .5 depending, respectively, on whether the airplane model 
was above or below 12,500 pounds. Again, parallel to the previous 
computations, the development costs were computed by multiplying the 
expected development hours by an engineering labor rate of $95 per 
hour. Similarly, the expected FAA review costs were computed as 80 
hours of review per CPCP, multiplied by a unit labor factor of $55 per 
hour. Finally, the industry and FAA costs were combined for a total 
projected development and review cost of $1.3 million. The present 
values of these costs sum to $563,835.\2\
---------------------------------------------------------------------------

    \2\ This evaluation does not address the ``inspection'' portion 
of the costs that would result for these future models since, within 
the study period, very few airplanes would be certificated and 
produced, and then age to the point where the inspections from a 
CPCP would be prevalent. Furthermore, the present values of these 
few, out-year expenses would be negligible relative to the other 
costs of this proposal.

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

[[Page 62149]]

    In summary, over the twenty-year study period of this analysis, the 
proposed CPCP operating requirement for existing certification models 
is projected to cost $80.0 million to the industry and $221 thousand to 
the FAA (all costs in present value.) For newly type certificated 
models, the proposed rule is projected to cost $534 thousand to the 
industry and $30 thousand to the FAA.
    Description of Benefits. The purpose of this rulemaking is to 
assure that corrosion does not degrade the airworthiness of affected 
air carrier airplanes. The corrosion prevention and control program 
contained in this proposal originates, in part, from the 
recommendations following the investigations of the Aloha Boeing 737-
200 accident on April 28, 1988 when 18 feet of upper fuselage separated 
from the airplane in flight. The National Transportation Safety Board 
determined the probable cause of that accident was that corrosion and 
metal fatigue led to separation of the airplane's skin and structure.
    All metal airframe structures are vulnerable to corrosion and older 
aircraft are much more likely to experience corrosion than newer 
airplanes. Corrosion is a natural process and occurs because of the 
tendency of metals over time to return to their original state. 
Maintenance and inspection records reveal that the presence of 
corrosion is more prevalent and pervasive in older aircraft. A review 
of the annual total of the number of listings in the Service Difficulty 
Reports involving corrosion over a subset of U.S. commercial airplanes 
provides a sense of the magnitude of the problem.

                                              Number of Service Difficulty Reports Involving ``Corrosion''
                                                                       [1990-1997]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                    Year of occurrence
                          Aircraft type                          ---------------------------------------------------------------------------------------
                                                                     1990       1991       1992       1993       1994       1995       1996       1997
--------------------------------------------------------------------------------------------------------------------------------------------------------
B-727...........................................................       2293       1746       3126       2786       2874       2520       2308       2350
B-737...........................................................        536        521        928       1003       1099        906        868       1223
B-747...........................................................        523        222        433        441        228        422        522        899
DC-9............................................................        564        436        375        732        657       1197       1104       1037
DC-10...........................................................        117         78        217        122        281        111        364        602
MD-80...........................................................          4          0         14         21         44         14          5         28
A-300...........................................................         11         18         32         37         10         17        109        184
                                                                 ------------
    Total.......................................................       4048       3021       5125       5142       5193       5187       5280       6323
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The problem of corrosion is that it is both prevalent and 
destructive. Multiple Site Damage (MSD) is an undesirable condition 
caused by wide spread cracking of an airplane structure. R. Plelloux, 
et al, in ``Fractographic Analysis of Initiation and Growth of Fatigue 
Cracks at Rivet Holes writes ``In the case of MSD, fatigue cracks are 
reported to initiate at rivet holes in the fuselage lap joints after 
the epoxy bond failed as a result of corrosion in high humidity 
environments * * * the cracks grow to a length of approximately 6 to 8 
mm (.25 inches to .30 inches) on each side of the rivet, before 
fracture by tensile instability. Note that rivets (on the airplane 
skin) are spaced an inch apart center to center. Crack growth in 
service has been reported to occur over 20,000 to 40,000 cycles.'' Thus 
corrosion can cause multiple cracks around a rivet. When the cracks 
reach a length of .25 to .3 inches fracture by tensile instability 
occurs. Cracks have been reported in aircraft with much fewer cycles 
than those recently upgraded from Stage 2 to Stage 3 standards in the 
last ten years.
    Corrosion's detrimental effects are not limited to rivet holes. 
Corrosion decreases the size of structural members and can also have 
bad synergisms with factors leading to early cracking. When a fatigue 
crack reaches a corroded section the growth rate of the crack increases 
by a factor of 3 (J.P. Chubb, et al, ``The Effect of Exfoliation 
Corrosion on the Fatigue Behavior of Structural Aluminum Alloys''). The 
NTSB report to the FAA on the Aloha Boeing 737 accident cited finding 
corrosion in the throttle cables (in the leading edge). When the 
appropriate cable sections were removed from the aircraft and inspected 
there were indications of corrosion and this corrosion likely weakened 
the cables so that they separated at lower than design load. Corrosion 
was present for the entire length of that portion of the cable routed 
through the leading edge.
    Since different sources may use slightly different definitions, for 
charity, several important definitions are now identified. The 
definition of multiple site damage is a source of widespread fatigue 
damage characterized by the simultaneous presence of fatigue cracks in 
the same structural element (i.e., fatigue cracks that may coalesce 
with or without other damage leading to a loss of required residual 
strength). Widespread fatigue damage (WFD) in a structure is 
characterized by the simultaneous presence of cracks at multiple 
structural details that are of sufficient size and density whereby the 
structure will no longer meet its damage tolerance requirement (i.e., 
to maintain its required residual strength after partial structural 
failure). Multiple element damage (MED) is a source of widespread 
fatigue damage characterized by the simultaneous presence of fatigue 
cracks in similar adjacent structural elements.
    The Boeing 737 lap splice design originally required a good bond 
for load transfer. Environmental degradation caused the bond to 
deteriorate to the point where all of the load transfer ended up 
transferred through the fasteners, which were never designed to take 
that load. MED can also result from corrosive environments as well.
    Benefits: A Risk Assessment. The FAA employed GRA,\3\ Inc. to 
provide a risk assessment to help make determinations regarding the 
likelihood of aviation accidents related to corrosion. Under this 
contract, GRA qualitatively identified and characterized the types of

[[Page 62150]]

potential corrosion hazards faced by aircraft and developed a method to 
assign quantitative risk evaluation.
---------------------------------------------------------------------------

    \3\ ``CORROSION PREVENTION AND CONTROL RISK ANALYSIS'', FAA 
Contract No. DTFA01-93-C-00066, Work Order 52, Prepared by GRA, 
Incorporated, May 12, 1999. A copy of this document is filled in the 
docket.
---------------------------------------------------------------------------

    For their analysis, GRA relied upon the National Transportation 
Safety Board (NTSB) Aviation/Incident Database. The NTSB database 
contains detailed information on over 37,000 accidents that have been 
catalogued since 1985; it includes a ``sequence of events'' history for 
each accident that describes the events leading up to an accident. A 
broad search of the 37,000 NTSB accidents resulted in a total of 1,551 
accidents that were examined in detail.
    The FAA Incident Data System (AIDS) was used to help assess the 
impacts of the Airworthiness Directives issued in the early 1990's. The 
FAA Service Difficulty Reporting System (SDRS) assisted by providing 
information assessing the incident and severity of the corrosion 
problem, as well as information of the effectiveness of current safety 
programs. GRA found it difficult to link incident and service 
difficulty reports with observed or anticipated changes in accident or 
incident rates. As a result, GRA took a conservative approach by not 
attempting to quantify benefits using either AIDS or SDRS.
    The methodology employed by GRA is known as ``event tree'' 
analysis. Event tree analysis is used to characterize a chain of events 
leading to accidents under a variety of circumstances. This methodology 
has been used successfully in other environments where, as with 
aircraft, the probabilities of occurrence are very small.
    Event trees are defined by:

[sbull] An initiating event
[sbull] A further chain of events related to ``safety functions'' which 
represent aircraft system responses or operator actions when a 
particular event occurs
[sbull] A terminating event
[sbull] Estimation of success and failure probabilities at relevant 
nodes in the event tree

    An event tree should define a comprehensive set of accident 
sequences that encompass the effects of all possible accidents 
involving the aircraft. These trees begin with the initiating event, or 
the starting point. Following the initiating event, the set of events 
related to safety functions, which end with the terminating, event is 
specified. With the event tree constructed information from the NTSB, 
1,551 accidents were used to populate (provide probability estimates) 
the tree.
    Event trees with corrosion-induced initiating events were defined 
based on these records for the following ten aircraft systems:

[sbull] Flight control surfaces/attachments
[sbull] Flight control system-internal
[sbull] Landing gear
[sbull] Fuselage forward
[sbull] Fuselage center
[sbull] Fuselage aft
[sbull] Fuel system
[sbull] Nacelle/Pylons
[sbull] Engines
[sbull] Electrical systems and wiring

    The subsequent events, which occur after the initiating event, were 
defined with the following generic sequence:

[sbull] Operator error in addressing/mitigating the initiating event
[sbull] Failure of operator to recover after initial failure to 
address/mitigate
[sbull] Failure of flight control function
[sbull] Failure of operator to recover flight control function
[sbull] Failure of landing gear during take-off or landing
[sbull] Failure of operator to recover landing gear function

    Beginning with the initiating event probability, each subsequent 
event probability is multiplied across each branch. The multiplication 
of events along each branch results in the probability of an outcome 
(or terminating event). Summing the terminating event probabilities, 
which end in damage, equals the probability of a corrosion-related 
accident by aircraft system. GRA's Table 2 with the estimated 
corrosion-related accident rates by aircraft system is reproduced 
below.

      Estimated Corrosion-Related Accident Rates by Aircraft System
------------------------------------------------------------------------
                                                               Rate per
                      Aircraft system                         1,000,000
                                                              operations
------------------------------------------------------------------------
1. Flight Control Attachments..............................    6.53 E-02
2. Flight Control System (internal)........................    7.51 E-02
3. Landing Gear............................................    1.89 E-01
4. Fuselage Forward........................................    9.60 E-03
5. Fuselage Center.........................................    1.97 E-02
6. Fuselage Aft............................................    2.05 E-03
7. Nacelle/Pylons..........................................    2.63 E-02
8. Fuel Systems............................................    1.94 E-02
9. Engine..................................................    2.15 E-01
10. Electrical Wiring......................................    8.80 E-02
                                                            ------------
  Total....................................................    7.01 E-01
    Skin-Related Only (1, 4, 5, 6, 7)......................    1.23 E-01
------------------------------------------------------------------------

    These probabilities of occurrence then need to be translated into 
numbers of accidents. Since the probabilities are rates per one million 
operations, estimates of future operations were needed. GRA computed 
the total take-offs and landings at U.S. airports from the May 1996 
Official Airline Guide (OAG). This estimate is conservative as it 
excludes U.S. aircraft performing foreign operations. The initial 
estimate of affected operations was 23,231,976 for 1996.
    GRA then excluded aircraft already subject to existing ADs and 
discounted the number of operations for other aircraft subject to other 
overlapping directives and rules. After scaling down the total number 
of operations, the adjusted estimate was 7,150,932 U.S. operations that 
would be affected by the proposed rule. To this adjusted OAG base, GRA 
applied the growth rate in FAA airport operations for air carriers and 
air taxi/commuters through the year 2008. By 2008, the number of 
affected operations rises to 9,133,300. Based upon the GRA databases 
and methodology, in the absence of this rule or other preventative 
action, it is estimated that over the period of 1999 through 2008 ten 
accidents due to corrosion are likely to occur in the part 121, 129 and 
135 fleets.
    More than 27 percent of the airplanes subject to this proposal are 
already 20 years old or older; 7 percent are over 30 years old; and 1 
percent of the airplanes are over 40 years old. The number of airplanes 
in air carrier service operating beyond their expected life is growing 
larger. As airplanes age, the likelihood of corrosion increases. 
Corrosion causes the formation of cracks and accelerates the growth of 
existing cracks. Thus corrosion is an identified problem presenting a 
growing threat to aviation safety. Experience has demonstrated that, 
under existing maintenance and inspection procedures, the FAA cannot 
assure the continuing airworthiness of these airplanes. This 
constitutes an unacceptable risk to air transportation.
    The FAA has extensively deliberated on how to mitigate this risk. 
Technical experts and academic leaders were consulted. Based upon these 
considerations and deliberations, the FAA believes that the corrosion 
prevention and control procedures proposed in this rule are the best 
approach to assure the continued protection of the subject fleet from 
corrosion damage that could impact safety.
    The primary benefit of this rule is increased aviation safety 
through assurance that the affected airplanes are free from dangerous 
corrosion. As has been shown, service difficulty reports of corrosion 
are increasing, and without this, or a similar rule, the FAA is 
convinced that unchecked corrosion will cause increasing numbers of 
future accidents. A secondary benefit from

[[Page 62151]]

minimizing corrosion is to extend aircraft service life. In response to 
a corrosion-related accident, the FAA is likely to ground similar 
aircraft until it can be assured of their airworthiness. As more 
accidents occur to different aircraft types, or if the inspections show 
corrective measures can not restore airworthiness, the FAA may 
determine that aircraft of a certain age need to be retired from the 
air carrier fleet. Consequently, in addition to expected safety 
benefits, society would benefit by a longer utilization of the affected 
aircraft, thereby reducing the cost of air transportation. The FAA has 
attempted to quantify the safety benefits and discusses the extended 
life benefits in qualitative terms.
    Safety Benefits. Based on GRA's risk assessment analysis, ten 
accidents due to corrosion could occur within the affected fleet during 
the ten year period 1999 through 2008. Since the period of analysis for 
this rule is 20 years, GRA's estimate has been extended by an 
additional ten years. A straight-line extrapolation based on the 
additional ten years of operations growth results in an estimate of 
about 25 accidents over a 20-year period. In this analysis such a 
straight-line forecast is viewed as a lower-bound estimate, because the 
GRA analysis did not factor in the joint problem an aging fleet coupled 
with unchecked metal corrosion increases the rate-of-risk over time. In 
order to provide an upper bound estimate, a simple, conservative 
methodology can be used. The actual probability distribution for 
corrosion-related accidents in the affected fleet is not known. A 
normal distribution, however, provides a close approximation of a 
number of other distributions. To be very conservative in this 
analysis, the FAA assumes that all affected aircraft remain in 
operation until a corrosion-related accident terminates their service. 
Under the assumption that the ten accidents from 1999 to 2008 belong to 
the left tail of a normal distribution of future corrosion-related 
accidents for the entire 2,900 affected aircraft, then it can be shown 
that these 10 accidents are more than 2.45 standard deviations from the 
mean. Assuming that these observations are 2.45 standard deviations 
from the mean, then 99.3 percent of the fleet would not have a 
corrosion-caused accident by 2008. This distribution has approximately 
a twenty-five year standard deviation. Such a distribution would have 
more than half of these aircraft still without a corrosion-caused 
accident fifty years from now. If this methodology can be accepted as 
providing a reasonable estimate of the upper bound of accidents, then 
in the absence of this rule, slightly more than 50 corrosion-related 
accidents are estimated to occur in the study period. This, in turn, 
provides a range of between 25 to 50 corrosion-caused accidents that 
may occur in 20 years.
    As previously discussed, this proposed rule is directed toward the 
smaller air carrier aircraft. From NTSB data, GRA estimated that the 
average casualty counts per accident were 1.100 minor injuries, 0.474 
serious injuries, and 1.605 fatalities. As a baseline estimate to 
compare safety benefits with costs, the FAA estimates that the value 
of: $38,500 to represent avoiding a minor injury, $51,800 to represent 
avoiding serious injury, and $2.7 million to represent avoiding a 
statistical fatality. Based on these values the expected benefit of 
avoiding one such accident today is $4.6 million, excluding the loss of 
the airframe, investigation, and ground damage. The FAA believes a 
conservative benefit estimate of avoiding such an accident is at least 
$5 million with a reasonable upper bound value of $6 million. Using the 
lower $5 million estimate and assuming that accidents for the are 
uniformly distributed over time, then in the thirteenth year the 
present value benefits of the accidents prevented roughly equals the 
cost of the proposed rule (at that time the number of accidents equals 
34). Thirty-four accidents falls between the upper and lower bound 
estimates, and is considered a reasonable number that could occur.
    This breakeven calculation assumes the proposed rule to be 100 
percent effective in preventing these accidents. The FAA can not 
determine a priori the effectiveness of the proposed rule, but can 
provide a reasonable effectiveness range and the associated range of 
benefits. Assuming that the rule would prevent 40 to 80 percent of the 
expected 25 to 50 accidents, then the rule could be expected to prevent 
between 9 accidents (40 percent x 25 accidents) to 40 accidents (80 
percent x 50 accidents). In the case of the lower bound estimate of 9 
accidents, for the present value safety benefits to equal the cost of 
the rule, the value of an avoided accident would need to increase 
approximately fourfold. Such an increase is entirely feasible since the 
assumed 1.6 averted fatalities per accident is conservative. Included 
in the potentially affected fleet are 178 Beech 1900 airplanes each 
with 19 passenger seats. If just 2.4 of the prevented accidents are 
Beech 1900 airplanes with a 75 percent load factor, then the present 
value benefits exceed the present value of costs.
    Exactly how many corrosion-related accidents will occur, which 
airplanes would suffer such an accident, and how effective the proposed 
rule would be can not be determined a priori. The FAA risk assessment 
estimated that this proposed rule would help to avert 25 to 50 
accidents. The rule needs only to be effective enough to prevent 2.4 
Beech 1900 accidents with 75 percent of the available seats occupied. 
It is known with certainty that corrosion currently exists in the fleet 
and if left unchecked will lead to accidents. Based upon this 
knowledge, and the estimates contained in this analysis, the FAA 
concludes that the benefits justify the costs of this proposed rule.
    Unquantified Benefits. The FAA proposed rule would require 
scheduled corrosion inspections sooner than the much more costly 
emergency inspections that would follow a corrosion-caused accident. It 
is more economical and efficient to correct an unsafe condition 
proactively, than after an accident makes it clear that corrective 
action is past due and immediate measures must be taken. Performing the 
proposed procedures by this rule would allow air carriers to schedule 
inspections and repairs in a planned, orderly, least cost manner 
without disrupting aircraft service time. In cases where corrosion is 
occurring, this proposal would make it known sooner and allow more 
economical corrective action. On the other hand, without a corrosion 
inspection plan, metal corrosion will continue, accidents are expected, 
and once an accident occurs it is highly likely that the FAA will 
mandate inspections. In that case, there usually is not sufficient time 
to thoroughly evaluate alternative solutions; instead, immediate 
corrective action must be selected. Such urgent action is rarely the 
most economical choice. Compliance with emergency inspections will 
result in these inspections being unscheduled, airline operators will 
incur aircraft out-of-service-time costs, airline flight schedules can 
be disrupted, and flights can be canceled. All of these factors result 
in reduced airline profits and lower benefits to the traveling public.
    As discussed above, it is expected that this proposal would result 
in corrosion damage observed sooner than it would otherwise, and 
therefore, the corrections would be less costly. In the absence of the 
rule, however, it is very possible for some aircraft that corrosion 
could continue to breakdown the metal undetected until it becomes 
uneconomic to repair the damage. In

[[Page 62152]]

that event, earlier inspection could have extended the service life of 
such aircraft. It is expected that the proposed rule inspections would 
result in corrosion damage to be repaired before this damage would 
cause the aircraft to not be airworthy, or to be retired. Thus the 
proposed rule can extend the service life of the affected aircraft. 
Without knowing the condition of the affected fleet, it is not possible 
to accurately quantify the dollar value of this benefit. However, it is 
possible to provide some idea of the value of longer service life by 
noting the value of extending the service life by one year of a 
hypothetical aircraft. In such a case, the annual capital loss equals 
the value of the aircraft multiplied by airline's rate-of-return on 
capital. For an aircraft whose resale value is a million dollars and 
when the rate-of-return on capital equals 10 percent, the annual 
capital loss is $100,000. In addition, the travelling public suffers 
when airline service is unexpectedly reduced by the corrosion-caused 
premature retirement of this aircraft.
    The FAA believes that the unquantified benefits discussed above 
further support and justify this proposal. Addressing corrosion damage 
in an orderly fashion, rather than waiting for an emergency action to 
be required, provides for less interrupted commercial service and 
extends airplane service life. These outcomes are clearly benefits of 
this proposal, even though there is insufficient data to quantify these 
benefits at this time.
    Comparison of Costs and Benefits. Corrosion is a natural process 
and occurs because of the tendency over time of metals to return to 
their original state. Maintenance and inspection records reveal that 
the presence of corrosion is more prevalent and pervasive in older 
aircraft. Based upon an independent risk analysis of over 1,500 
National Transportation Safety Board accidents and conservative risk 
assessment results in a forecast of a range between 25 to 50 corrosion-
induced accidents over a twenty-year period, with a present value cost 
between $72.5 million and $145 million. The safety benefits of averting 
these accidents justify the costs of the proposed rule.
    The FAA does not intend to wait for a series of accidents to 
provide justification for this proposed rule. The FAA needs the 
assurance of the corrosion prevention and control program to assure the 
continued airworthiness of the affected fleet. With this program in 
place the industry avoids unplanned inspections and maintenance 
resulting from corrosion-related accidents and benefits by an extended 
aircraft service life.
    This proposed rule would extend to a significant number of 
airplanes the corrosion prevention and control program found to be 
necessary for in-service commercial jet airplanes based on studies 
following the Aloha Boeing 737 accident. Based on the analysis 
contained herein, the FAA concludes that the benefits of this proposed 
rule justify the costs.

Initial Regulatory Flexibility Analysis

    The Regulatory Flexibility Act of 1980 establishes ``as a principle 
of regulatory issuance that agencies shall endeavor, consistent with 
the objective of the rule and of applicable statutes, to fit regulatory 
and informational requirements to the scale of the business, 
organizations, and governmental jurisdictions subject to regulation.'' 
To achieve that principle, the Act requires agencies to solicit and 
consider flexible regulatory proposals and to explain the rationale for 
their actions. The Act covers a wide range of small entities, including 
small businesses, not-for-profit organizations, and small governmental 
jurisdictions.
    Agencies must perform a review to determine whether a proposed or 
final rule will have a significant economic impact on a substantial 
number of small entities. If the determination finds that it will, the 
agency must prepare a regulatory flexibility analysis (RFA) as 
described in the Act.
    However, if an agency determines that a proposed or final rule is 
not expected to have a significant economic impact on a substantial 
number of small entities, section 605(b) of the 1980 act provides that 
the head of the agency may so certify, and an RFA is not required. The 
certification must include a statement providing the factual basis for 
this determination, and the reasoning should be clear.
    Recently, the Office of Advocacy of the Small Business 
Administration (SBA) published new guidance for Federal agencies in 
responding to the requirements of the Regulatory Flexibility Act, as 
amended. Application of that guidance to this proposed rule indicates 
that it would have a significant impact on a substantial number of 
small entities. Accordingly, a full regulatory flexibility analysis was 
conducted and is summarized as follows.

1. A Description of the Reasons Why Action by the Agency Is Being 
Considered

    This action is being considered in order to control airplane 
structural material loss and the detrimental effects of corrosion 
because existing maintenance or inspection programs may not provide 
comprehensive, systematic corrosion prevention and control.

2. A Succinct Statement of the Objectives of, and Legal Basis for, the 
Proposed Rule

    The objective of the proposed rule is to ensure the continuing 
airworthiness of aging airplanes operating in air transportation by 
requiring all airplanes operated under part 121, all U.S. registered 
airplanes used in scheduled passenger carrying operations under part 
129, and all multiengine airplanes used in scheduled passenger carrying 
operations conducted under part 135, to include a Federal Aviation 
Administration (FAA) approved corrosion prevention and control program 
(CPCP) in the airplane's maintenance or inspection program.
    This proposal represents a critical step toward compliance with the 
Aging Aircraft Safety Act of 1991. In October of 1991, Congress enacted 
Title IV of Public Law 102 143, the ``Aging Aircraft Safety Act of 
1991,'' to address aging aircraft concerns. The act was subsequently 
recodified as 49 U.S.C. 44717. Section 44717 of Title 49 instructs the 
Administrator to ``prescribe regulations that ensure the continuing 
airworthiness of aging aircraft.''

3. A Description of the Projected Reporting, Recordkeeping and Other 
Compliance Requirements of the Proposed Rule, Including an Estimate of 
the Classes or Types of Small Entities That Will Be Subject to the 
Requirement and the Type of Professional Skills Necessary for 
Preparation of the Report or Record

    The proposed rule would not impose any incremental record keeping 
authority. Existing 14 CFR part 43, in part, already prescribes the 
content, form, and disposition of maintenance, preventive maintenance, 
rebuilding, and alteration records for any aircraft having a U.S. 
airworthiness certificate or any foreign registered aircraft used in 
common carriage under parts 121 or 135. The FAA recognizes, however, 
that the proposed rule would necessitate additional maintenance work, 
and consequently, would also require that the additional record keeping 
associated with that work also be performed.
    The FAA estimates that each hour of actual inspection and 
maintenance conducted under the proposal would require an additional 20 
percent of an hour (12 minutes) for reporting and

[[Page 62153]]

record keeping. This record keeping would be performed by the holder of 
an FAA approved repairman or maintenance certificate. The projected 
record keeping and reporting costs of the proposal are included as part 
of the overall costs computed in the evaluation and included below in 
the Regulatory Flexibility Cost Analysis.

4. An Identification, to the Extent Practicable, of All Relevant 
Federal Rules That May Duplicate, Overlap, or Conflict With the 
Proposed Rule

    The FAA is unaware of any federal rules that would duplicate, 
overlap, or conflict with the proposed rule.

5. A Description and an Estimate of the Number of Small Entities to 
Which the Proposed Rule Would Apply

    The proposed rule would apply to the operators of all airplanes 
operated under 14 CFR part 121, all U.S. registered multiengine 
airplanes operated under 14 CFR part 129, and all multiengine airplanes 
used in scheduled operations under 14 CFR part 135. Standard industrial 
classification coding does not exactly coincide with the subsets of 
operators who could be affected by the proposed rule. Nevertheless, the 
following distributions of employment size and estimated receipts per 
employee for all scheduled air transportation firms (SIC Code 4512) are 
representative of the operators who would be affected by the proposed 
rule.

------------------------------------------------------------------------
                                                              Estimated
                                                  Number of    receipts
               Employment category                  firms        per
                                                               employee
------------------------------------------------------------------------
0-4.............................................        137     $611,695
5-9.............................................         45      510,555
10-19...........................................         52      299,123
20-99...........................................        112      264,065
100-499.........................................         78      232,666
500+............................................         70      252,334
                                                 ------------
    Totals......................................        494      252,214
------------------------------------------------------------------------

    Based on existing operator/airplane distributions, the FAA 
estimates that 210 operators would be subject to the rule and 
approximately 132 would actually incur costs.\4\ The agency has also 
estimated the numbers of subject and affected airplanes that each 
operator uses and has categorized the operators by fleet size in the 
following table.
---------------------------------------------------------------------------

    \4\ The remaining operators use airplane models that would be 
subject to the proposed rule but are already in full compliance.

                           Count of Operators
------------------------------------------------------------------------
                                                   Subject   Affected by
          Operator category (airplanes)            to rule       rule
------------------------------------------------------------------------
1-10............................................        119           84
11-20...........................................         37           16
21-30...........................................         12            4
31-40...........................................          8            6
41-50...........................................          4            4
51 and up.......................................         30           18
                                                 ------------
                                                        210          132
------------------------------------------------------------------------

6. Regulatory Flexibility Cost Analysis

    The proposed rule would affect certain existing and future 
production aircraft, and it would also apply to new model airplanes 
intended for use in scheduled service. This Regulatory Flexibility Cost 
Analysis focuses on the first of these two categories because: (1) That 
impact represents almost 99 percent of the evaluated costs of the 
proposed rule, and (2) it is possible to make some estimate of the 
distributional impact of these costs based on the existing operator 
fleet composition.
    Table 3 in the Appendix details the computations used to estimate 
the annualized costs of the proposal per airplane, by model. Column A 
in Table 3 lists each airplane model and Column B details the estimated 
counts of the airplanes in each model that would be subject to the 
proposed rule. As noted in the evaluation, an estimated 7,108 airplanes 
would be subject to this major provision. These airplanes are included 
within the regulatory scope of the proposal but the vast majority would 
be unaffected because they already comply with the proposal. Column C, 
by comparison, shows the projected counts of those airplanes that would 
actually be affected; where incremental work would be accomplished and 
incremental expenses incurred. This column sums to a projected 2,901 
airplanes. Column D contains the present value of the projected cost of 
the major proposal to industry, by airplane model, as computed in the 
regulatory evaluation and shown previously as Column AG of Table 1 in 
the Appendix. The present value estimated cost of this provision totals 
$80.0 million.
    Column E of Table 3 divides the cost-per-model data in Column D by 
the numbers of affected airplanes per model in Column C to produce the 
expected present value cost of the proposal per affected airplane. It 
is useful to consider the annualized equivalent of these costs; that is 
to say, the annual future payments that would be necessary to equal the 
present value costs for each model. Such payments are a function of: 
(1) The assumed interest rate, and (2) the time period over which the 
future payments would be borne. Consistent with the discount factor, 
this evaluation applies a 7 percent interest rate. As for the time 
period, the evaluation assesses costs over a 20-year time period, and 
this analysis assumes that, on average, the CPCP development and 
implementation costs would be borne over that period. Based on these 
two assumptions, the annualized cost of the CPCP would range between 
$484 and $30,170 per airplane (for those airplanes that would actually 
be affected.)
    Next, the annualized cost estimates, by model, per affected 
airplane, from Table 3 were collated into the original evaluation data 
set of operators and airplanes. Crosstabulations were performed and 
aggregated (see Table 4 in the Appendix) to project the expected 
annualized cost per operator. Table 4 includes all 210 of the estimated 
operators of airplanes that would be subject to the proposed rule, and 
projects that 132 would actually incur costs. The table includes 
counts, by operator, the number of airplanes that would be subject to 
(within the scope of) the proposed rule, and the numbers of airplanes 
that would actually be affected by the proposal. The data in these 
calculations are summarized in the table below which shows the average 
annualized impact per operator; where the operator classifications are 
grouped both by: (1) The number of all airplanes that the operator 
uses, and (2) the number of each operator's airplanes that would 
actually be affected by the proposal.

                                     Average Annualized Impact per Operator
----------------------------------------------------------------------------------------------------------------
                                                                      Average        Count of         Average
                   Count of airplanes operated                      annualized       airplanes      annualized
                                                                      impact         affected         impact
----------------------------------------------------------------------------------------------------------------
1-10............................................................          $7,318            1-10         $14,057

[[Page 62154]]

 
11-20...........................................................          17,551           11-20          46,479
21-30...........................................................          30,711           21-30          72,326
31-40...........................................................          53,838           31-40         104,708
41-50...........................................................          64,359           41-50          55,789
51-60...........................................................          90,769           51-60         196,433
61-70...........................................................         191,587           61-70         195,857
71-80...........................................................         144,698           71-80         185,253
81-90...........................................................         111,116           81-90         111,116
91-100..........................................................          92,093          91-100         112,023
100 Plus........................................................         217,054        100 Plus         460,822
----------------------------------------------------------------------------------------------------------------

7. Affordability Analysis and Disproportionality Analysis

    As a measure of the affordability of the proposal, the table below 
shows a distribution of the projected annualized impacts of the 
proposed rule as a percentage of operator annual receipts. Operator 
receipt levels were estimated assuming: (1) The average of $252,214 
annual receipts per employee for SIC Code 4512 operators, described 
above in Paragraph 5, and (2) an example factor of 5 employees per 
airplane operated. (This factor varies widely across operators.) The 
affordability statistic was then calculated for each of the 210 subject 
operators as the projected annualized cost of the rule for that 
operator divided by the product of $252,214 times 5 employees per 
airplane times the number of airplanes operated. Under these 
assumptions, the expected annualized cost of the proposal for 209 of 
the 210 operators falls below 0.6 percent of their respective estimated 
annualized receipts. For one operator, costs would total 1.38 percent 
of estimated receipts.
    The table can also be used to gauge the disproportionality of the 
proposed rule's relative burden. The percentage impact calculations are 
shown for three sizes of operators, depending on the numbers of 
airplanes that they operate. The calculations show a minor 
disproportionate impact on smaller operators who are slightly under-
represented in the lowest ``percentage impact'' categories, and 
correspondingly, slightly over-represented in the higher impact 
categories.

                          Count of Operators by Percentage Impact and by Operator Size
----------------------------------------------------------------------------------------------------------------
                                                                              Airplanes operated
                      Percentage impact                      ---------------------------------------------------
                                                                  1-10        11-50         51+         Total
----------------------------------------------------------------------------------------------------------------
0-.1........................................................           68           38           19          125
.1-.2.......................................................           10           10            6           26
.2-.3.......................................................           15            4            2           21
.3-.4.......................................................           16            7            3           26
.4-.5.......................................................            8            2            0           10
.5-.6.......................................................            1            0            0            1
1.3-1.4.....................................................            1            0            0            1
    Total...................................................          119           61           30          210
----------------------------------------------------------------------------------------------------------------

8. Business Closure Analysis

    The FAA feels that the annualized average impact of the rule as a 
function of an affected firm's average annual receipts is low. The 
agency recognizes, and this evaluation has described, that the 
potential impact for some operators may be above average and may not be 
distributed evenly over time. The cost methodology for this evaluation 
further addresses the fact that it may not be economical to develop and 
implement a corrosion prevention and control program for some older 
airplane models with few subject airplanes. The evaluation estimated 
that program costs would be prohibitive for 11 airplane models, and 
included a 50 percent reduction of fleet resale value as an estimated 
cost attributable to the rule.

9. Competitiveness Analysis

    No quantitative estimate of the proposed rule's potential impact on 
small business competitiveness has been made. However, the FAA feels 
that the findings from the Affordability Analysis and the 
Disproportionality Analysis above support the argument that the 
proposed rule will not seriously impede small entity competitiveness.

10. Description of Alternatives

    The FAA has considered several approaches to this proposed 
rulemaking and has attempted to minimize the potential economic impact 
of the proposal, especially the impact on the operation of aircraft 
most likely to be used by small entities. The principal alternative 
would be to take no new rulemaking action and to rely on the existing 
corrosion related requirements in parts 23 and 25. The FAA has 
determined that these existing requirements have not always resulted in 
a comprehensive and systematic corrosion prevention and control program 
for either transport, commuter, or small category airplanes. In 
addition, the FAA has determined that such inaction would not respond 
to the provisions of 49 U.S.C. 44717, which requires the Administrator 
to prescribe regulations that ensure the continuing airworthiness of 
aging aircraft.
    A second alternative would be to omit all small aircraft from the 
proposal since there is an identifiable correlation between smaller 
firms and smaller aircraft. Again, the FAA opposes this alternative 
since it would leave the existing problem for a significant

[[Page 62155]]

segment of the scheduled passenger industry and would create an 
unacceptable safety inequity.
    As proposed, this rulemaking would apply to all airplanes operated 
under part 121, all U.S. registered multiengine airplanes operated 
under part 129, and all multiengine airplanes used in scheduled 
operations under part 135. The proposed rule would not include 
helicopters, single-engine airplanes operated under part 135 or part 
129, airplanes used in cargo operations under part 135, or airplanes 
used in unscheduled (on-demand) operations under part 135.
    The aircraft and operations omitted from this proposal are not 
exclusively operated by small entities, but the FAA holds that the 
excluded airplane categories are more likely to be operated by small 
entities than, for example, large transport category airplanes would 
be. As noted above, the proposed rule would actually affect some 2,900 
airplanes. By comparison, the exclusions described here, taken 
together, remove an estimated 5,023 additional aircraft from the 
proposal. This includes, with overlap, 1,441 helicopters; 4,663 
aircraft used in on-demand operations; and 1,812 single-engine 
aircraft.
    The FAA specifically requests comments regarding the exclusion of 
such aircraft operations from this proposed rule.

11. Compliance Assistance

    In its efforts to assist small entities and other affected parties 
in complying with the proposed rule, the FAA is publishing an advisory 
circular, ``Development of Corrosion Prevention and Control Programs.'' 
A notice of availability for this circular will be published 
concurrently with the proposed rule. This circular details acceptable 
means of compliance with the proposed rule.
    Additionally, the FAA has developed a CPCP for a generic, civil, 
twin-engine aircraft and will make this document available as part of 
the appendix to the advisory circular accompanying the proposed rule. 
This document can serve as a core framework for the baseline program 
for defining the corrosion prevention and control requirements for a 
subject airplane model based on the average operating profile and 
operating environment. This generic CPCP model would be particularly 
useful to small operators in the event that the type certificate holder 
for a given model is not available to develop the CPCP for that model.

Trade Impact Assessment

    Consistent with the Administration's belief in the general 
superiority, desirability, and efficacy of free trade, it is the policy 
of the Administrator to remove or diminish, to the extent feasible, 
barriers to international trade, including both barriers affecting the 
export of American goods and services to foreign countries and those 
affecting the import of foreign goods and services into the United 
States.
    In accordance with that policy, the FAA is committed to develop as 
much as possible its aviation standards and practices in harmony with 
its trading partners. Significant cost savings can result from this, 
both to American companies doing business in foreign markets, and 
foreign companies doing business in the United States.
    This proposed rule would have little or no impact on international 
trade.

Unfunded Mandates Assessment

    Title II of the Unfunded Mandates Reform Act of 1995 (the Act), 
enacted as Pub. L. 104-4 on March 22, 1995, requires each Federal 
agency, to the extent permitted by law, to prepare a written assessment 
of the effects of any Federal mandate in a proposed or final agency 
rule that may result in the expenditure by State, local, and tribal 
governments, in the aggregate, or by the private sector, of $100 
million or more (adjusted annually for inflation) in any one year. 
Section 204(a) of the Act, 2 U.S.C. 1534(a), requires the Federal 
agency to develop an effective process to permit timely input by 
elected officers (or their designees) of State, local, and tribal 
governments on a proposed ``significant intergovernmental mandate.'' A 
``significant intergovernmental mandate'' under the Act is any 
provision in a Federal agency regulation that will impose an 
enforceable duty upon State, local, and tribal governments, in the 
aggregate, of $100 million (adjusted annually for inflation) in any one 
year. Section 203 of the Act, 2 U.S.C. 1533, which supplements section 
204(a), provides that before establishing any regulatory requirements 
that might significantly or uniquely affect small governments, the 
agency shall have developed a plan that, among other things, provides 
for notice to potentially affected small governments, if any, and for a 
meaningful and timely opportunity to provide input in the development 
of regulatory proposals.
    The FAA determines that this proposed rule would not contain a 
significant intergovernmental or private sector mandate as defined by 
the Act.

Availability of Draft Advisory Material

    The FAA has prepared guidance material in the form of an advisory 
circular (AC) to be used by operators and manufacturers in developing 
baseline CPCP's and incorporating them into maintenance and inspection 
programs. The FAA is soliciting comments on the draft AC during the 
comment period for this notice. A notice of availability for the draft 
AC is published concurrently with this notice.

International Compatibility

    The FAA has reviewed corresponding International Civil Aviation 
Organization (ICAO) standards and recommended practices and Joint 
Airworthiness Authority (JAA) regulations. ICAO Aging Aircraft 
Standards contain requirements for a continuing structural integrity 
program that includes corrosion prevention and control. At this time 
the JAA does not have any operating rules for airplanes, and therefore 
has no general requirement for corrosion programs comparable to this 
proposal. Nevertheless, in the interest of international harmonization, 
the FAA will continue to keep the JAA informed of this rulemaking.

Executive Order 13132, Federalism

    The FAA has analyzed this proposed rule under the principles and 
criteria of Executive Order 13132, Federalism. We determined that this 
action would 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, we determined that this notice of proposed 
rulemaking would not have federalism implications.

Environmental Analysis

    FAA Order 1050.1D defines FAA actions that may be categorically 
excluded from preparation of a National Environmental Policy Act (NEPA) 
environmental assessment or environmental impact statement. In 
accordance with FAA Order 1050.1D, appendix 4, paragraph 4 (j), this 
rulemaking action qualifies for a categorical exclusion.

Energy Impact

    The energy impact of the notice has been assessed in accordance 
with the Energy Policy and Conservation Act (EPCA) Pub. L. 94-163, as 
amended (43 U.S.C. 6362) and FAA Order 1053.1. It has been determined 
that the notice is not a major regulatory action under the provisions 
of the EPCA.

[[Page 62156]]

Reporting Requirements

    The proposed rule would not impose any new regulatory requirements 
for recordkeeping. Existing 14 CFR part 43, in applicable part, already 
prescribes the content, form, and disposition of maintenance, 
preventive maintenance, rebuilding, and alteration records for each 
aircraft having a U.S. airworthiness certificate or any foreign 
registered aircraft used in common carriage under parts 121 or 135. The 
FAA recognizes, however, that the proposed rule would necessitate 
additional maintenance work, and consequently, would also require that 
the recordkeeping associated with that work also be performed in 
accordance with existing regulations.

Paperwork Reduction Act

    Information collection requirements in the proposed rule have been 
previously approved by the Office of Management and Budget (OMB) under 
the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 
3507(d)) and have been assigned OMB Control Numbers 2120-0008 and 2120-
0039.

List of Subjects

14 CFR Part 121

    Air carriers, Aircraft, Airmen, Aviation safety, Charter flights, 
Drug testing, Reporting and recordkeeping requirements, Safety, and 
Transportation.

14 CFR Part 129

    Air carriers, Aircraft, Aviation safety, Reporting and 
recordkeeping requirements, Security measures, and Smoking.

14 CFR Part 135

    Air taxis, Aircraft, Airmen, Aviation safety, and Reporting and 
recordkeeping requirements.

The Proposed Amendment

    In consideration of the foregoing, the Federal Aviation 
Administration proposes to amend Chapter I, Title 14 of the Code of 
Federal regulations parts 121, 129, and 135 as follows:

PART 121--OPERATING REQUIREMENTS: DOMESTIC, FLAG, AND SUPPLEMENTAL 
OPERATIONS

    1. The authority citation for part 121 continues to read as 
follows:

    Authority: 49 U.S.C. 106(g), 40101, 40113, 40119, 44101, 44701-
44702, 44705, 44709-44711, 44713, 44716-44717, 44722, 44901, 44903-
44904, 44912, and 46105.

    2. Add Sec.  121.376 to read as follows:


Sec.  121.376  Corrosion prevention and control program.

    (a) After [insert a date two years after the effective date of the 
final rule], no certificate holder may operate an airplane unless a 
corrosion prevention and control program (CPCP) is included in the 
operator's FAA-approved maintenance program.
    (b) The CPCP must--
    (1) Be designed to control corrosion such that the damage does not 
exceed Level 1 as defined in Sec.  121.376a,
    (2) Specify corrosion prevention and control tasks,
    (3) Specify definitions of corrosion levels, compliance times 
(implementation thresholds and repeat intervals), and
    (4) Specify procedures if corrosion damage exceeds Level 1 in any 
area, including mechanisms to notify the FAA of the findings and data 
associated with such damage and to implement FAA-approved means of 
reducing future findings of corrosion in that area to Level 1 or 
better.
    (c) For airplanes that have exceeded the implementation threshold 
for a specific area prior to [insert date two years after the effective 
date of the final rule], the CPCP must include an implementation 
schedule that will result in the completion of all corrosion prevention 
and control tasks for that area no later than [insert date four years 
after the effective date of the final rule].
    3. Add Sec.  121.376a to read as follows:


Sec.  121.376a  Level 1 corrosion definition.

    For the purposes of this part, Level 1 Corrosion is:
    (a) Corrosion damage occurring between successive inspections that 
is local and can be re-worked/blended-out within allowable limits as 
defined by the manufacturer or as approved by the FAA;
    (b) Corrosion damage that is local but exceeds allowable limits and 
can be attributed to an event not typical of the operator's usage of 
other airplanes in the same fleet; or
    (c) Corrosion damage that operator experience over several years 
has demonstrated to be only light corrosion between successive prior 
inspections but that the latest inspection shows that cumulative blend-
outs now exceed allowable limits as defined by the manufacturer or as 
approved by the FAA.

PART 129--OPERATIONS: FOREIGN AIR CARRIERS AND FOREIGN OPERATORS OF 
U.S.-REGISTERED AIRCRAFT ENGAGED IN COMMON CARRIAGE

    4. The authority citation for part 129 continues to read as 
follows:

    Authority: 49 U.S.C. 106(g), 1511-1522, 40101, 40104-40105, 
40113, 40119, 44701, 44901, 44903-44904, 44906, 44912, 44914, 44935-
44939, 48107.

    5. Revise Sec.  129.1(b) to read as follows:


Sec.  129.1  Applicability.

* * * * *
    (b) In addition to operations of U.S.-registered aircraft within 
the United States under paragraph (a) of this section, Sec. Sec.  
129.14, 129.16, 129.20, 129.33, and 129.35 also apply to U.S.-
registered aircraft operated solely outside the United States in common 
carriage by a foreign person or foreign air carrier.
    6. Add Sec.  129.24 to read as follows:


Sec.  129.24  Level 1 corrosion definition.

    For the purposes of this part, Level 1 Corrosion is:
    (a) Corrosion damage occurring between successive inspections that 
is local and can be re-worked/blended-out within allowable limits as 
defined by the manufacturer or as approved by the FAA;
    (b) Corrosion damage that is local but exceeds allowable limits and 
can be attributed to an event not typical of the operator's usage of 
other airplanes in the same fleet; or
    (c) Corrosion damage that an operator has experienced over several 
years has demonstrated to be only light corrosion between successive 
prior inspections but that the latest inspection shows that cumulative 
blend-outs now exceed allowable limits as defined by the manufacturer 
or as approved by the FAA.
    7. Add Sec.  129.35 to read as follows:


Sec.  129.35  Corrosion prevention and control program.

    (a) After [insert a date two years after the effective date of the 
final rule], no foreign air carrier or foreign person may operate U.S.-
registered multiengine airplane in common carriage, unless a Corrosion 
Prevention and Control Program (CPCP) is included in the operator's 
FAA-approved maintenance program.
    (b) The CPCP must--
    (1) Be designed to control corrosion such that the damage does not 
exceed Level 1 as defined in Sec.  129.24,
    (2) Specify corrosion prevention and control tasks,

[[Page 62157]]

    (3) Specify definitions of corrosion levels, compliance times 
(implementation thresholds and repeat intervals), and
    (4) Specify procedures if corrosion damage exceeds Level 1 in any 
area, including mechanisms to notify the FAA of the findings and data 
associated with such damage and to implement FAA-approved means of 
reducing future findings of corrosion in that area to Level 1 or 
better.
    (c) For airplanes that have exceeded the implementation threshold 
for a specific area prior to [insert date two years after the effective 
date of the final rule], the CPCP must include an implementation 
schedule that will result in the completion of all corrosion prevention 
and control tasks for that area no later than [insert date four years 
after the effective date of this rule].

PART 135--OPERATING REQUIREMENTS; COMMUTER AND ON-DEMAND OPERATIONS

    8. The authority citation for part 135 continues to read as 
follows:

    Authority: 49 U.S.C. 106(g), 1153, 40101, 40105, 44113, 44701-
44705, 44707-44717, 44722, and 45303.

    9. Add Sec.  135.424 to read as follows:


Sec.  135.424  Corrosion prevention and control program.

    (a) After [insert a date two years after the effective date of the 
final rule], no certificate holder may operate a multiengine airplane 
in scheduled service unless a Corrosion Prevention and Control Program 
(CPCP) is part of the operator's FAA-approved maintenance or inspection 
program.
    (b) The CPCP must--
    (1) Be designed to control corrosion such that the damage does not 
exceed Level 1 as defined in Sec.  135.426,
    (2) Specify corrosion prevention and control tasks,
    (3) Specify definitions of corrosion levels, compliance times 
(implementation thresholds and repeat intervals), and
    (4) Specify procedures if corrosion damage exceeds Level 1 in any 
area, including mechanisms to notify the FAA of the findings and data 
associated with such damage and to implement FAA-approved means of 
reducing future findings of corrosion in that area to Level 1 or 
better.
    (c) For airplanes that have exceeded the implementation threshold 
for a specific area prior to [insert date two years after the effective 
date of the final rule], the CPCP must include an implementation 
schedule that will result in the completion of all corrosion prevention 
and control tasks for that area no later than [insert date four years 
after the effective date of the final rule].
    10. Add Sec.  135.426 to read as follows:


Sec.  135.426  Level 1 corrosion definition.

    For the purposes of this part, Level 1 Corrosion is:
    (a) Corrosion damage occurring between successive inspections that 
is local and can be re-worked/blended-out within allowable limits as 
defined by the manufacturer or as approved by the FAA;
    (b) Corrosion damage that is local but exceeds allowable limits and 
can be attributed to an event not typical of the operator's usage of 
other airplanes in the same fleet; or
    (c) Corrosion damage that an operator has experienced over several 
years has demonstrated to be only light corrosion between successive 
prior inspections but that the latest inspection shows that cumulative 
blend-outs now exceed allowable limits as defined by the manufacturer 
or as approved by the FAA.

    Issued in Washington, DC, on September 25, 2002.
Louis C. Cusimano,
Acting Director, Flight Standards Service.
[FR Doc. 02-24932 Filed 10-2-02; 8:45 am]
BILLING CODE 4910-13-P