Section 4306 of the Farm Security and Rural Investment Act of 2002, (Pub. L. 107-171), enacted May 13, 2002, amends section 17(d)(2)(B)(i) of the Child Nutrition Act of 1966 (42 U.S.C. 1786), to allow WIC State agencies the option to exclude housing allowances paid to military personnel for privatized on-base or off-base housing in determining income eligibility for the WIC Program. In accordance with Pub. L. 107-171, this provision became effective May 13, 2002.

This regulation is a final rule because the Department does not have discretion in how State agencies implement this provision. The provision, as set forth in this final rule, merely reflects the legislation. Thus, it is considered a non-discretionary provision.

This regulation provides WIC State agencies the option to exclude payments to military personnel for privatized housing, whether on- or off-base. Therefore, in this final rule section 246.7(d)(2)(iv)(A)( 1 ) of the WIC Program regulations is revised to include this State agency option. Previously, WIC legislation and regulations provided State agencies the option to exclude military housing allowances provided to military service personnel residing off military installations from consideration as income in determining WIC income eligibility. Since on-base housing has traditionally been provided to families without charge or indication of a cash allowance on their paychecks, WIC has considered this an in-kind benefit that has not been counted as income for WIC eligibility purposes. Therefore, the provision in Pub. L. 107-171 provides State agencies the option to extend the income exclusion to include privatized on-base military housing allowances.

The privatization of military housing is intended to provide improved, quality housing for military families living on base by contracting with private developers. An allowance is paid directly to military personnel that can be used only for rent. The household does not have the discretion to use this allowance for any other purpose, even though it is provided as a cash benefit and reflected as such on the employee's Leave and Earnings Statement (LES) as a Basic Allowance for Housing (BAH). Off-base military housing allowances are also reflected on the LES as BAH.

Since payments for privatized housing are reflected as BAH on military pay stubs, WIC agencies cannot readily determine whether this is an off-base or on-base housing allowance. Further, it is clear based on enactment of this provision that Congress intends WIC State agencies to have the option to provide consistent treatment of military housing allowances in determining WIC income eligibility. Therefore, if a WIC State agency chooses to exclude BAH, in effect, it has chosen to exclude off-base housing allowances and payments for privatized on-base housing.

This rule has been determined to be not significant and was not reviewed by the Office of Management and Budget under Executive Order 12866.

This rule has been reviewed under Executive Order 12988, Civil Justice Reform. This rule is intended to have preemptive effect with respect to any State or local laws, regulations or policies which conflict with its provisions or which would otherwise impede its full implementation. This rule is not intended to have retroactive effect unless so specified in the EFFECTIVE DATE paragraph of this preamble. Prior to any judicial challenge to the provisions of this rule or the application of its provisions, all applicable administrative procedures must be exhausted.

This rule has been reviewed with regard to the requirements of the Regulatory Flexibility Act (5 U.S.C. 601-612). Roberto Salazar, Administrator, Food and Nutrition Service, has certified that this rule will not have a significant economic impact on a substantial number of small entities. This rule modifies WIC application and certification procedures. Therefore, the effect of this change will be primarily on WIC applicants and State and local WIC agencies, some of which are small entities. However, the impact on small entities is not expected to be significant.

This final rule does not contain new reporting or record keeping requirements subject to approval by the Office of Management and Budget under section 3507 of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-20). The information collection burden associated with certification and eligibility of WIC participants is approved under OMB No. 0584-0043.

Executive Order 13132 requires Federal agencies to consider the impact of their regulatory actions on State and local governments. Where such actions have federalism implications, agencies are directed to provide a statement for inclusion in the preamble to the regulations describing the agency's considerations in terms of the three categories called for under section (6)(b)(2)(B) of Executive Order 13132. The Food and Nutrition Service has determined that this final rule does not have Federalism implications under Executive Order 13132. This rule makes changes that are required by Pub. L. 107-171, and became effective on May 13, 2002. The Department does not have discretion in how State agencies implement this provision. The provision, as set forth in this final rule, is reproduced verbatim from the legislation.

The Special Supplemental Nutrition Program for Women, Infants and Children (WIC) Program is listed in the Catalog of Federal Domestic Assistance under 10.557. For the reasons set forth in the final rule in 7 CFR part 3015, subpart V and related notice (48 FR 29115), this program is included from the scope of Executive Order 12372, which requires intergovernmental consultation with State and local officials.

Unfunded Mandate Reform Act of 1995 (UMRA) Title II of UMRA establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Under section 202 of the UMRA, FNS generally must prepare a written statement, including a cost-benefit analysis, for proposed and final rules with “Federal mandates” that may result in expenditures to State, local, or tribal governments in the aggregate, or to the private sector, of $100 million or more in any one year. When such a statement is needed for a rule, section 205 of the UMRA generally requires FNS to identify and consider a reasonable number of regulatory alternatives and adopt the least costly, more cost-effective or least burdensome alternative that achieves the objectives of the rule. This rule contains no Federal mandates (under the regulatory provisions of Title II of the UMRA) for State, local, and tribal governments or the private sector of $100 million or more in any one year. This rule is, therefore, not subject to the requirements of sections 202 and 205 of the UMRA.

FNS has reviewed this final rule in accordance with the Department Regulation 4300-4, “Civil Rights Impact Analysis,” to identify and address any major civil rights impacts this rule might have on minorities, women, and persons with disabilities. FNS has no discretion in implementing this change in income eligibility assessment. All data available to FNS indicate that protected individuals have the same opportunity to participate in the WIC Program as non-protected individuals. FNS specifically prohibits the State and local government agencies that administer the WIC Program from engaging in actions that discriminate based on race, color, national origin, sex, age or handicap. Regulations at 7 CFR 246.8 specifically state that “Department of Agriculture regulations on non-discrimination (7 CFR parts 15, 15a and 15b), and FNS instructions ensure that no person shall on the grounds of race, color, national origin, age, sex, or handicap, be excluded from participation in, be denied benefits of, or be otherwise subjected to discrimination under the Program.” Discrimination in any aspect of program administration is prohibited by these regulations, Department of Agriculture regulations on non-discrimination (7 CFR parts 15, 15a, and 15b), the Age Discrimination Act of 1975 (Pub. L. 94-135), the Rehabilitation Act of 1973 (Pub. L. 93-112, section 504), and title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d). Enforcement action may be brought under any applicable Federal law. Title VI complaints shall be processed in accord with 7 CFR part 15. Where State agencies have options, and they choose to implement a certain provision, they must implement it in such a way that it complies with the regulations at 7 CFR 246.8.

This action is being finalized without prior notice or public comment under authority of 5 U.S.C. 553(b)(3)(A) and (B). This final rule implements a non-discretionary legislative provision in the Farm Security and Rural Investment Act of 2002, Pub. L. 107-171, by providing WIC State agencies the option to exclude payments to military personnel for privatized housing, whether on- or off-base, when determining income eligibility for the WIC Program. Thus, the Department has determined in accordance with 5 U.S.C. 553(b) that notice of proposed rulemaking and opportunity for public comments is unnecessary and contrary to the public interest.

The provisions became effective May 13, 2002. Therefore, we are making this rule effective retroactively to May 13, 2002.

Section 1601(c) of the 2002 Act requires that the regulations needed to implement Title I of the 2002 Act are to be promulgated without regard to the notice and comment provisions of 5 U.S.C. 553 or the Statement of Policy of the Secretary of Agriculture effective July 24, 1971, (36 FR 13804) relating to notices of proposed rulemaking and public participation in rulemaking. These regulations are thus issued as final.

This final rule has been determined to be not significant under Executive Order 12866 and has not been reviewed by the Office of Management and Budget (OMB).

This rule has a potential impact on all programs listed in the Catalog of Federal Domestic Assistance in the Agency Program Index under the Department of Agriculture, Farm Service Agency and Natural Resources Conservation Service. Other assistance programs are also impacted.

The Regulatory Flexibility Act is not applicable to this rule because neither the Secretary of Agriculture nor CCC are required by 5 U.S.C. 553 or any other law to publish a notice of proposed rulemaking for the subject matter of this rule.

The environmental impacts of this rule have been considered in accordance with the provisions of the National Environmental Policy Act of 1969 (NEPA), 42 U.S.C. 4321 et seq., the regulations of the Council on Environmental Quality (40 CFR parts 1500-1508), and FSA's regulations for compliance with NEPA, 7 CFR part 799. FSA has concluded that this rule is categorically excluded from further environmental review and documentation as evidenced by the completion of an environmental evaluation. No extraordinary circumstances or other unforeseeable factors exist which would require preparation of an environmental assessment or environmental impact statement. A copy of the environmental evaluation is available for inspection and review upon request.

The final rule has been reviewed in accordance with Executive Order 12778. This final rule preempts State laws that are inconsistent with its provisions. Before a judicial action may be brought concerning this rule, all administrative remedies must be exhausted.

This program is not subject to the provisions of Executive Order 12372, which require intergovernmental consultation with State and local officials. See the notice related to 7 CFR part 3015, subpart V, published at 48 FR 29115 (June 24, 1983).

The provisions of Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) do not apply to this rule because neither the Secretary of Agriculture nor CCC are required by 5 U.S.C. 553 or any other law to publish a notice of proposed rulemaking for the subject matter of this rule. Also, the rule imposes no mandates as defined in UMRA.

Section 1601(c) of the 2002 Act requires that the regulations necessary to implement Title I of the 2002 Act must be issued within 90 days of enactment and that such regulations shall be issued without regard to the notice and comment provisions of 5 U.S.C. 553. Section 1601(c) also requires that the Secretary use the authority in section 808 of the Small Business Regulatory Enforcement Fairness Act of 1996, Pub. L. 104-121 (SBREFA), which allows an agency to forgo SBREFA's usual 60-day Congressional Review delay of the effective date of a major regulation if the agency finds that there is a good cause to do so. Accordingly, this rule is effective upon the date of filing for public inspection by the Office of the Federal Register.

Section 1601(c) of the 2002 Act requires that these regulations be promulgated and the programs administered without regard to the Paperwork Reduction Act. This means that the information to be collected from the public to implement these programs and the burden, in time and money, the collection of the information would have on the public does not have to be approved by the Office of Management and Budget or be subject to the normal requirement for a 60-day public comment period.

FSA is committed to compliance with the Government Paperwork Elimination Act, and continued pursuit of providing all services electronically when practicable. This rule involves no request for a program eligibility determination, payment of benefits, agreements, or contracts that readily lend themselves to electronic access, submission, receipt, or approval. Thus, the Government Paperwork Elimination Act does not apply.

Section 1613 of the Farm Security and Rural Investment Act of 2002 (2002 Act) addresses relief where bad departmental advice or information is given or where a participating producer of an “agricultural commodity” fails to comply fully with program requirements but otherwise acts in good faith. Section 1613 provides that, under that section, “agricultural commodity” means any agricultural commodity, food, feed, fiber, or livestock that is subject to a “covered program.” A “covered program” is defined as (1) a program administered by the Secretary of Agriculture (Secretary) under which price or income support, or production or market loss assistance, is provided to producers of “agricultural commodities;” and (2) a conservation program administered by the Secretary. But, the section specifies, “covered programs” do not include (1) an agricultural credit program carried out under the Consolidated Farm and Rural Development Act (7 U.S.C. 1921 et seq. ); or (2) the crop insurance program carried out under the Federal Crop Insurance Act (7 U.S.C. 1501 et seq. ).

Using those definitions, the law provides that the Secretary may provide relief to any participant that is determined to be not in compliance with the requirements of a covered program, and therefore ineligible for a loan, payment, or other benefit under the covered program, but only if the participant (1) acting in good faith, relied on the action or advice of the Secretary, or an authorized representative, to the detriment of the participant; or (2) failed to comply fully with the requirements of the covered program, but made a good faith effort to do so. In these cases, the statute specifies, the Secretary may authorize a participant in a covered program to (1) retain loans, payments, or other benefits received under the covered program; (2) continue to receive loans, payments, and other benefits under the covered program; (3) continue to participate, in whole or in part, under any contract executed under the covered program; (4) in a conservation program, re-enroll all or part of the land covered by the program; and (5) receive such other equitable relief as they determine appropriate. Section 1613 also specifies that the Secretary may condition the approval of relief under this section on the participant agreeing to remedy their failure to meet the program requirement.

Also, the law provides for special autonomy for State Directors of the Department's Farm Service Agency and State Conservationists of the Department's Natural Resources and Conservation Service in granting equitable relief. In general, section 1613 provides that the State Director and the State Conservationist, in the case of programs administered by their respective offices, may grant relief to a participant(subject to certain limitations) if (1) the amount of loans, payments, and benefits for which relief will be provided to the participant under this special authority is less than $20,000; (2) the total amount of loans, payments, and benefits for which relief has been previously provided to the participant under this special authority is not more than $5,000; and (3) the total amount of loans, payments, and benefits for which relief is provided to similarly situated participants is not more than $1,000,000, as determined by the Secretary. This rule addresses only programs administered through FSA and, hence, through State Directors.

Further, the new law provides that such State Director grants of relief (1) shall not require prior approval by the Administrator of the Department of Agriculture's Farm Service Agency, or any other officer or employee of the Agency or Service; (2) shall be made only after consultation with, and the approval of, the Office of General Counsel of the Department of Agriculture; and (3) are subject to reversal only by the Secretary (who may not delegate the reversal authority). Furthermore, the statute specifies that this special State Director authority does not apply to the administration of (1) payment limitations under (i) sections 1001 through 1001F of the Food Security Act of 1985 (7 U.S.C. 1308 et seq. ), or (ii) a conservation program administered by the Secretary; or to (2) highly erodible land and wetland conservation requirements under subtitle B or C of title XII of the Food Security Act of 1985 (16 U.S.C. 3811 et seq. ). The State Director authority, the new law specifies, is in addition to any other applicable authority and does not limit other authority provided by law or the Secretary. Under the terms of the new law, a discretionary decision by the Secretary, the State Director, or the State Conservationist under the Section 1613 authority to grant relief in cases of bad information or good faith failures to fully comply with program rules shall be final, and shall not be subject to review under chapter 7 of title 5, United States Code, which provides generally for the relief of agency decisions.

Additionally, the statute requires that, not later than February 1 of each year, the Secretary shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes for the previous calendar year (1) the number of requests to the program agencies for “mis-information” and “failure to fully comply” relief (utilizing the Section 1613 authority) and (2) the number of requests for equitable relief under section 278(d) of the Department of Agriculture Reorganization Act of 1994(7 U.S.C. 6998(d)). Also, information must be submitted regarding the disposition of the requests. The reference to 7 U.S.C. 6998 (d) involves the authority of the Director of the Department's National Appeals Division to grant equitable relief under the same standards as those that apply to FSA.

Section 1613 further states that the authority provided in this section is in addition to any other authority provided in that or any other Act. Also, section 1613 amends section 281(a) of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 7001(a)) with respect to the “90-day finality rule” which exempted two determinations from its coverage. One is decisions involving the administration of the Consolidated Farm and Rural Development Act, and the second, are determinations arising out of conservation programs administered by the Natural Resources Conservation Service. Those exemptions are reflected in new language in this rule.

Section 1613 also repeals provisions for equitable relief which were contained in 7 U.S.C. 1339a and in 16 U.S.C. 3830. Changes to reflect those repeals will be made as needed in other rules. This rule is limited to 7 CFR part 718 which governs these issues generally for programs administered by the Farm Service Agency of the Department.

With the exception of the changes in the coverage of the finality rule noted above, this rule implements the section 1613 provisions on equitable relief in cases involving incorrect information or action by FSA and failure to comply provisions as they apply to FSA programs and to those programs of the Commodity Credit Corporation that are administered through the FSA. Other agencies within the Department, if any, to which these provisions apply may issue separate rules in this regard. With respect to the special State Director relief provisions, such relief is still under the control of the Secretary and subject to uniform rules under this part. The rules are broad in that regard and do not invade the provisions contemplated by the statute as they have been determined to be in this rule.

Under this rule, the statute is read as applying prospectively only. Relief will be allowed only for actions taken by producers to their detriment after enactment of the 2002 Act (May 13, 2002). (This includes any relief granted under the special State Director provisions). Nothing in the statute provides for retroactive application of the new rules and it was not understood that such a result was intended. A different result, opening old disputes, would be chaotic. Presumably, Congress would have specified that such retroactively was intended if it meant to have the statute read that way. In any event, even if retroactively were allowed, it would be rejected because of the unfairness and chaos it would create. Such a rejection would be authorized under the provisions of the statute which make the granting of any relief under section 1613 discretionary. This allows for one uniform set of rules for all types of relief for actions in the same time period. Again, this also applies to the State Directors. They have the authority to grant relief within the confines of the statute, and are not authorized to decide general policy for the granting of relief on such matters as the timing of the actions for which relief may be granted. Obviously it would be improper to have those officials have differing interpretations of which decisions fall within the general scope of the powers granted them by the statute and, in any event, the general exercise of those powers are still subject to the supervision of the Secretary under whose authority these rules are written.

The statute as indicated does set certain dollar limits on the officials granted the special relief authority. However, the dollar limits are not tied, in the words of the statute itself, to a particular time period or official. Believing that tying of dollar amounts to nonetheless be the intent, given the normal yearly orientation of farm programs (as is reflected in the reporting requirements of the statute), such a tie has been made in the rule. The limits are made yearly limits. Special rules are set out for how the computation will be made.

Obviously, the amounts involved would be prohibitively small among the many States. And, the cross-State accounting that would otherwise be required would be difficult. Neither that difficulty, nor the odd race to grant relief that it might produce, appear to be intended. Rather, it appears that this provision was meant to provide a substantive change which would otherwise, within reasonable limits, short circuit the normal review process that might otherwise be required before the producer could enjoy the benefit of relief. Even if the statute were to be read as being not limited to a particular year or a particular official the additional authority that would be created by the rule would be within the general discretion granted the Secretary. However, since there will still be dollar limits, the rule does require that, in addition to the approval by the Office of the General Counsel of the Department, State Directors who use this special power must declare in writing their intent to use that authority. They must also report the use of the authority so that an accounting can be made. Rules issued in this notice cover those matters as well.

This rule has been determined to be not significant for purposes of Executive Order 12866 and therefore has not been reviewed by the Office of Management and Budget (OMB).

The information collection requirements contained in this regulation have been previously approved by OMB under the provisions of 44 U.S.C. chapter 35 and this regulation has been assigned OMB control number 0575-0181, in accordance with the Paperwork Reduction Act of 1995. This rule does not impose any new information collection requirements from those approved by OMB.

This rule has been reviewed under Executive Order 12988, Civil Justice Reform. In accordance with this rule: (1) All state and local laws and regulations that are in conflict with this rule will be preempted; (2) no retroactive effect will be given to this rule; and (3) administrative proceedings in accordance with 7 CFR part 11 must be exhausted before bringing suit in court challenging action taken under this rule.

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Pub. L. 104-4, establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Under section 202 of the UMRA, RHS generally must prepare a written statement, including a cost-benefit analysis, for proposed and final rules with “Federal mandates” that may result in expenditures to State, local, or tribal governments, in the aggregate, or to the private sector, of $100 million or more in any one year. When such a statement is needed for a rule, section 205 of the UMRA generally requires RHS to identify and consider a reasonable number of regulatory alternatives and adopt the least costly, more cost-effective or least burdensome alternative that achieves the objectives of the rule.

This rule contains no Federal mandates (under the regulatory provisions of Title II of the UMRA) for State, local, and tribal governments or the private sector. Therefore, this rule is not subject to the requirements of section 202 and 205 of the UMRA.

The policies contained in this rule do not have any substantial direct effect on 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. Nor does this rule impose substantial direct compliance costs on state and local governments. Therefore, consultation with the states is not required.

The affected program is listed in the Catalog of Federal Domestic Assistance under Number 10.405, Farm Labor Housing Loans and Grants.

For the reasons contained in the Final Rule related Notice to 7 CFR part 3015, subpart V, this program is subject to Executive Order 12372 which requires intergovernmental consultation with State and local officials. RHS has conducted intergovernmental consultation in the manner delineated in RD Instruction 1940-J.

This document has been reviewed in accordance with 7 CFR part 1940, subpart G, “Environmental Program.” It is the determination of RHS that this action does not constitute a major Federal action significantly affecting the quality of the human environment and in accordance with the National Environmental Policy Act of 1969, Pub. L. 91-190, an Environmental Impact Statement is not required.

This rule has been reviewed with regard to the requirements of the Regulatory Flexibility Act (5 U.S.C. 601-612). The undersigned has determined and certified by signature of this document that this rule will not have a significant economic impact on a substantial number of small entities since this rulemaking action does not involve a new or expanded program nor does it require any more action on the part of a small business than required of a large entity.

Farmworkers are among the lowest paid workers in the United States and often lack decent, safe, sanitary, and affordable housing. RHS's FLH program provides loans and grants for farmworker housing and related facilities.

The FLH program is authorized by title V of the Housing Act of 1949 under section 514 (42 U.S.C. 1484) for loans and section 516 (42 U.S.C. 1486) for grants. Section 516 also authorizes the RHS to provide financial assistance (not more than 10 percent of the section 516 funds) to encourage the development of domestic and migrant farm labor housing projects.

RHS's FLH program provides funding for both “on-farm” and “off-farm” housing. The housing may also be for either seasonal or year-round occupancy. Off-farm housing, typically apartment complexes, is open to farmworkers who work at any farming operation. On-farm housing provides housing for the workers of only one farm and is typically designed as single family dwellings. Occupancy of both types of housing is restricted to United States citizens or permanent resident aliens.

Off-farm migrant housing serves farmworkers who perform agricultural work at one or more locations away from their home base throughout the year for periods ranging from a few weeks to several months. Rental assistance is available to many tenants of off-farm housing to make rents affordable. Off-farm housing is financed with section 514 loans and section 516 grants to nonprofit organizations and public agencies such as local housing authorities, and with section 514 loans to limited partnerships in which the general partner is a nonprofit entity.

On-farm housing loans are made to farmers or farm entities to provide housing for farmworker families employed by the farm. On-farm housing is financed with section 514 loans and is not eligible for 516 grants. The tenants (farmworkers) who live in on-farm housing are not eligible for rental assistance.

RHS also provides financial assistance to private and public nonprofit agencies to encourage the development of domestic and migrant farm labor housing projects. The services that are provided by these non-profit agencies pursuant to section 516(i) are commonly referred to as “technical assistance.”

Prior to Fiscal Year (FY) 2000, RHS awarded technical assistance “contracts.” These contracts were awarded for one year periods with four option periods that could be exercised at the discretion of the Government. In FY 2000, RHS changed the way that FLH technical assistance funds were awarded. During FY 2000, RHS awarded technical assistance “grants” rather than “contracts.”

On June 21, 2000, a Request for Proposals (RFP) was published in the Federal Register requesting “grant” proposals from private and public nonprofit agencies. The RFP outlined the application requirements and the criteria that would be used to select proposals for funding. The RFP also established three FLH technical assistance grant regions (the Eastern, Central, and Western grant regions) and contained the terms of the grants.

On September 27, 2000, three technical assistance grants were awarded. Two of the grants were awarded for the Western grant region and the other was awarded for the Central grant region. No grant proposals were received for the Eastern grant region. Each of the grants has a three year grant period.

When the RFP was published, comments and suggestions were received from interested parties. Some suggested that more than one FY's funding should be made available during the three year grant period. Another issue was that the Central grant region received less funding than the Eastern and Western grant regions. Lastly, one commentor expressed that it was unfair to consider an applicant's experience if such experience was gained outside of the grant region or to give equal weight to an applicant's experience in developing non-farmworker multifamily housing to an applicant's experience in developing farmworker housing.

In the future, RHS intends to periodically publish RFPs that are similar to the one that was published on June 21, 2000. When published, RHS will have the opportunity to make changes to the way funds are distributed, to the minimum performance requirements that must be met, or to other terms of the grants. RHS will at that time consider the suggestions that have been made. However, this revision to the regulation only implements the statutory authority for awarding grants. It does not establish the application requirements, the selection criteria, the performance standards that must be met, or how funds will be distributed when grants are awarded.

On June 1, 2001, the Agency published a proposed rule in the Federal Register (66 FR 29739) to establish the eligibility requirements that nonprofit agencies must meet to receive technical assistance grants and to establish how the financial assistance will be made available by RHS. By this final rule, the Agency is also adding a definition of the term “Technical assistance” for clarity.

Two commentors responded during the comment period. The Agency wishes to thank the respondents for their comments and suggestions. The comments we received are summarized and discussed below.

One commentor suggested that “for profit” organizations should be eligible to receive technical assistance grants. However, the statutory authority for awarding technical assistance grants (section 516(i) of the Housing Act of 1949-42 U.S.C.1486(i)) only authorizes assistance to be provided to private or public nonprofit agencies.

One commentor suggested that RHS had greatly increased the paperwork requirements and the application process. This rule, however, does not set forth the application requirements. As stated in the proposed rule, “Requests for Proposals (RFP) may be periodically published in the Federal Register” and “RFPs will contain the amount of funding, the method of allocating or distributing funds, where to submit proposals, proposal requirements, the deadline for the submission of proposals, the selection criteria, and the grant agreement to be entered into between RHS and the grantee.”

A proposed amendment to the NRC's fitness-for-duty (FFD) regulations (10 CFR Part 26) was published on May 9, 1996 (61 FR 21105). When the NRC sought clearance from the Office of Management and Budget (OMB) to publish a final rule, stakeholders expressed a number of concerns about the rule and its implementation. Given the significance of stakeholder concerns, the NRC concluded on October 3, 2001, that it should: (1) Withdraw the OMB clearance request; (2) request additional public comment on all of the rule's provisions; and (3) conduct stakeholder meetings concerning a combined access authorization and FFD guidance document. As a result of public meetings with stakeholders, the NRC learned of licensee practices in two FFD areas, “suitable inquiry” and “pre-access testing,” that did not meet the current Part 26 requirements.

Among its other provisions, the FFD rule provides drug- and alcohol-related requirements for authorizing individuals for unescorted access to nuclear power plant protected areas or for performing activities related to Strategic Special Nuclear Materials. Under the FFD rule, to grant authorization to an individual who has not been employed in the nuclear industry before, licensees must:

(1) Conduct a “suitable inquiry” into the individual's employment history for the past five years to identify if the individual had any substance abuse problems;

(2) Ask the individual to provide a “self-disclosure” of any substance abuse problems;

(3) Perform a “pre-access” drug and alcohol test and verify that the results are negative; and

(4) Provide training to the individual regarding the effects of drugs and alcohol on job performance and the requirements of the licensee's FFD program.

To maintain authorization, individuals must:

(1) Be subject to “behavioral observation” by supervisors who are trained to detect signs of possible impairment and changes in behavior;

(2) Report any drug- or alcohol-related arrests; and

(3) Be subject to random and “for-cause” drug and alcohol testing with negative test results.

Other requirements for authorizing individuals for unescorted access to nuclear power plant protected areas are defined in 10 CFR 73.56, “Personnel Access Authorization Requirements for Nuclear Power Plant Personnel.” NRC Regulatory Guide (RG) 5.66 (1991), “Access Authorization Program for Nuclear Power Plants,” provides guidance for implementing § 73.56. One requirement in § 73.56 is that licensees must conduct a background investigation with former employers to determine whether an individual is trustworthy and reliable. Licensees typically ask employers the FFD suitable inquiry questions at the same time.

Although the FFD regulations (10 CFR part 26) and the access authorization regulations (§ 73.56) are intended to assure that nuclear personnel are trustworthy and reliable, there are some differences between them. One important difference is that the access authorization regulations and RG 5.66 address licensees authorizing unescorted access for individuals who are transferring between licensee sites and have interruptions in their authorization. The FFD regulations are less clear on the subject of transfers and short breaks in authorization. For example, the only provision in the current FFD regulations that indirectly addresses these situations allows licensees to rely on a pre-access drug and alcohol test that was performed by another licensee within the past 60 days. Therefore, if the individual had a negative result from another licensee's drug and alcohol test within the past 60 days, the individual does not have to be tested again before authorization is reinstated at the new licensee's site. Guidance contained in NUREG-1385, “Fitness for Duty in the Nuclear Power Industry: Responses to Implementation Questions,” states that licensees may “accept” an authorization granted by a previous licensee for individuals who transfer between licensees with a “short break” in authorization, but the period of time considered to be a “short break” is not defined. As a result, the current FFD regulations have the potential to be interpreted as requiring licensees to treat each individual under consideration for authorization as a new hire, because of the absence of the clear requirements for transfers and reinstatements similar to those found in the access authorization regulations.

At the time the FFD regulations were developed (June 7, 1989; 54 FR 24468), the industry structure was different and personnel transfers ( i.e. , leaving the employment of one licensee to work for another licensee) between licensees with interruptions in authorization were less common. Most licensees operated plants at a single site and maintained a FFD program that applied only to that site. When an individual left employment at one site and began working for another licensee, the individual would be subject to a different FFD program that often had different requirements. Further, because some licensees were reluctant to share information about previous employees with the new employer, licensees often did not have access to the information the previous licensee had gathered about the individual. With relatively few licensee employees changing jobs, the approach in the current FFD regulations caused some delays in granting authorization, but assured that a licensee had complete information upon which to base an authorization decision. The current FFD requirements are particularly burdensome to contractor/vendor (C/V) personnel who more frequently transfer between sites, but, because C/V personnel as a group consistently tested positive for drugs and alcohol at a higher rate than permanent licensee employees (see NRC Information Notice 2001-02), the NRC believed the regulation's requirements were warranted.

Since 1989, the industry has undergone significant consolidation and developed new business practices to use its workforce more efficiently. The FFD regulations that treat all individuals who are transferring between licensees as new hires, and the lack of detailed requirements in the FFD regulations for managing transfers between sites when authorization is interrupted for short periods, have created a number of unnecessary burdens on licensees.

For example, a single nuclear utility may now operate many sites and maintain one corporate FFD program that applies to multiple sites. Thus, an employee at one site operated by the corporation may be transferred to another site operated by the same corporation, and still be subject to the same FFD program. However, the individual is technically transferring to a new licensee and so, under the current regulations, is required again to meet the FFD requirements for authorization at the new site. Although the individual's work history is well documented in the FFD program, if that individual takes an extended vacation, for example, or spends 60 days at corporate headquarters between onsite assignments, the current FFD regulations require that the individual be treated as a new hire. The individual's ability to start work at the new site may be unnecessarily delayed until the suitable inquiry and pre-access drug and alcohol testing requirements of the current FFD regulations are met.

In addition, industry efforts to better use expertise and staffing resources have resulted in the development of a large transient workforce within the nuclear industry that travels from site to site as needed, such as roving outage crews. Although the industry has always relied upon C/Vs for special expertise and to staff for outages, the number of transient personnel who work solely in the nuclear industry has significantly increased and the length of time they are onsite has decreased. Although the employment histories of these individuals are well known within the industry, these individuals also must be treated as new hires under the current FFD regulations.

Because the current FFD regulations were written on the basis that individual licensees would maintain independent, site-specific FFD programs and would share limited information, and that the majority of nuclear personnel would remain at one site for years, the regulations do not adequately address the transfer of personnel between sites with short interruptions in authorization between assignments. As a result, licensees applied the principles of their access authorization programs (under § 73.56 and RG 5.66) to the FFD programs, and developed three practices that do not meet the intent of the current FFD rule's requirements, but are consistent with the NRC's intent that licensees assure that personnel who are authorized to perform activities within the scope of Part 26 are trustworthy and reliable.

With regard to conducting a suitable inquiry before authorizing unescorted access, many licensees have adopted two practices that are consistent with access authorization requirements for background investigations, but are inconsistent with the FFD requirements regarding suitable inquiries. First, many licensees were not contacting employers when an individual had worked for an employer for less than 30 days. Instead, licensees followed the practice for background investigations set forth in RG 5.66. Licensees only contacted employers for whom the individual had worked for 30 days or more. Second, in many cases, if an individual left one licensee's site and worked at a job that did not require access authorization for two weeks, and then was assigned to another licensee within 30 days of leaving the previous licensee, the receiving licensee would not contact the interim employer for the suitable inquiry. However, if the individual had an interruption in authorization of more than 30 days, the licensee would contact interim employers for suitable inquiry purposes. As is allowed under access authorization guidance, licensees focused the suitable inquiry on the period of interruption, and relied on the information collected by previous licensee(s) to meet the five-year suitable inquiry requirement. Although the requirements for a suitable inquiry under the FFD regulations and those for a background investigation under the access authorization regulations differ, licensees believed that it was reasonable to use the same practices for these regulations.

As a result of initial meetings with stakeholders, the NRC developed an approach, in SECY-01-0134, to address inconsistent implementation with regard to contacting employers for each 30-day period. Specifically, until a final rule that would address this issue became effective, the following approach would be taken under an interim enforcement policy: The NRC normally would not take enforcement action for a licensee's failure to contact all employers when an individual was employed for less than 30 days, provided that the licensee verified at least one period of employment status during that 30-day period. For example, during the month of April, if a transient worker was employed by Employer A for two weeks, Employer B for one week, and unemployed for one week, under this interim policy, it would only be necessary to verify the individual's status for one of these periods. Because this practice required at least one contact for each 30-day period, the NRC believed, at the time the policy was proposed, that this approach provided adequate safety in a cost-effective manner.

With regard to pre-access testing, many licensees were not conducting a pre-access test for alcohol and drugs in those cases where an individual was subject to a licensee's FFD program within the past 30 days. However, the fact that an individual was recently subject to a FFD program does not necessarily mean the individual was recently tested for drugs and alcohol. Thus, this practice conflicts with 10 CFR 26.24(a)(1) and the applicable provisions of the NRC's guidance in NUREG-1385. The current regulations require, and the guidance provides, that an applicant be tested for drugs and alcohol “within 60 days prior to the initial granting of unescorted access.” They do not provide an exception for a reinstatement or transfer where there is little or no interruption in authorization.

Licensees were not conducting the pre-access test in these cases because they viewed the initial FFD pre-access screening as being the same as initial screening for access authorization under 10 CFR 73.56. Initial screening for access authorization is completed once and, as long as the individual remains subject to behavioral observation and arrest-reporting requirements, the initial screening is not repeated.

The NRC believes that it is reasonable that short interruptions in authorization be treated similarly to continuous coverage under a FFD program. For example, a worker who is subject to a FFD program, but is unavailable for behavioral observation and possible random testing while on vacation for two or three weeks, is generally considered to be under continuous coverage and is not given a pre-access test upon return. Also, the practice of omitting the pre-access test when the interruption in coverage is less than 30 days is similar to NRC's practice in related areas. For example, using the guidance endorsed by RG 5.66 for access authorization programs, licensees generally do not conduct a background investigation for an individual when the interruption in authorization is less than 30 days. In another example, the guidance in NUREG-1385, states that an individual covered by a C/V's FFD program may take a (reasonably short) period of time to transfer from one site to another without invoking the need for a pre-access test.

In SECY-01-0134, the staff proposed the following interim enforcement policy: The NRC normally would not take enforcement action for a licensee's failure to conduct a pre-access test for alcohol and drugs in those cases where an individual has had a short break in FFD coverage, provided certain conditions are met. That is, the individual was subject to a FFD program for at least 30 of the previous 60 days and has not, in the past, tested positive for illegal drugs, been subject to a plan for treating substance abuse, been removed from or made ineligible for activities within the scope of Part 26, been denied unescorted access by any other licensee, or had adverse employment action taken by another employer in accordance with a drug and alcohol policy.

The Commission's Staff Requirements Memorandum dated October 3, 2001, directed the staff to request additional public comment on all the proposed rule's provisions and to conduct several stakeholder meetings concerning combined access authorization and FFD guidance. In response to the Commission's direction, the NRC staff has engaged stakeholders in monthly public meetings since November 15, 2001. As a result of these meetings, and as the industry develops new access authorization guidance that is currently under NRC review, the NRC has determined that the enforcement discretion proposed in SECY-01-0134 would not adequately address a number of concerns.

These concerns include:

(1) The proposed approach does not adequately address new information developed subsequent to the events of September 11, 2001;

(2) The proposed approach does not allow a licensee to take credit for the information gathered about an individual during suitable inquiries conducted by previous licensees;

(3) A determination of the number of days in a 60-day period that an individual had been subject to a Part 26 FFD program would create an unnecessary regulatory burden; and

(4) The proposed approach is inconsistent with current and anticipated access authorization guidance and would result in continued discrepancies between access authorization guidance and FFD requirements.

In light of the events of September 11, 2001, and the increased interactions with stakeholders, the NRC now believes that contacting only one employer in each 30-day period in which the individual was employed by more than one employer does not provide a sufficient level of assurance that individuals granted initial authorization are trustworthy and reliable. Short periods of employment could be a warning sign of substance abuse problems. Therefore, in order to increase the likelihood of early detection of any developing substance abuse problems, the NRC has concluded that it is necessary (with one exception noted below) that every employer be contacted to meet the five-year suitable inquiry requirement, as required in the current regulations.

The NRC believes that a suitable inquiry is not necessary for individuals being reinstated or transferred with an interruption in authorization of 30 days or less. Based upon industry experience, the NRC has concluded that there is limited risk from individuals who have established a work history within the nuclear industry, have previously met the access authorization and FFD regulations for granting and maintaining authorization, and have a short break in authorization due to a vacation or a transfer to a different site. Further, these individuals are required to self-disclose any drug- and alcohol-related problems that may have occurred during the period of interruption, and they recognize that a failure to report this information to the licensee may result in permanent revocation of authorization throughout the nuclear power industry. The requirement for a self-disclosure prior to reinstating authorization provides additional assurance that any developing substance abuse problems are detected for the period in which authorization was interrupted.

The NRC has also concluded that it is reasonable for licensees to rely upon the information gathered by previous licensees, and by C/Vs with licensee-approved FFD programs, to meet the suitable inquiry requirement. Because licensees and C/Vs now share the information they have gathered about an individual applicant for authorization, the requirement for each new licensee to independently contact every employer from the past five years is redundant and unnecessary.

The discretion policy proposed in SECY-01-0134 also did not recognize that many licensees and C/Vs now maintain some personnel in a “ready to be authorized” status, although the individuals are not currently working at a site or assigned to perform activities within the scope of the FFD rule. These individuals have met the FFD and access authorization regulations for authorization, and are subject without interruption to the licensee's or C/V's FFD program, including FFD training, behavioral observation, for-cause alcohol and drug testing, and are required to report any drug-or alcohol-related arrests. In some cases, they are also subject to random testing for drugs and alcohol. Licensees maintain that they should be able to “take credit” for the elements of the FFD program to which an individual has been subject without interruption when deciding whether to grant authorization for unescorted access to a nuclear power plant protected area.

To illustrate the implications of the current FFD regulations in these cases, consider an individual who has been working at a nuclear utility's corporate headquarters for the past 45 days and has been subject to all of the elements of the licensee's FFD program. This individual is being transferred within the licensee corporation or to a site of a different licensee and will again require unescorted access to the protected area. Because the individual has not been authorized for unescorted access at a site during the past 45 days, the current regulations require the licensee to:

(1) Obtain another self-disclosure ( i.e. , a self-report of any drug-or alcohol-related arrests), despite the fact that the individual has been continuously obligated to self-report any drug-or alcohol-related arrests under the corporate FFD program;

(2) Conduct a new suitable inquiry of the individual's past five years of employment before granting authorization, despite the fact that a suitable inquiry was conducted when the individual was first granted authorization and the individual has been continuously employed by the same corporation during the 45-day interruption in access authorization at a site; and

(3) Perform a pre-access test for drugs and alcohol if the individual had not been selected for random testing within the past 60 days, despite the fact that the individual was tested as part of the initial authorization process, has been continuously subject to the possibility of being tested, and may have been subject to random testing several times since the first authorization was granted.

These actions represent an unnecessary regulatory burden in such instances.

The NRC further believes that one FFD program element cannot be substituted for another. So, for example, if an individual has been subject to a licensee's or C/V's FFD behavioral observation and arrest-reporting requirements, but was not subject to random testing, then the licensee would be required to conduct a pre-access test for drugs and alcohol. If an individual was not under arrest-reporting and behavioral observation requirements without interruption, but had a drug and alcohol test within the past 60 days, then only the self-disclosure and suitable inquiry would be necessary before granting authorization.

Based on these considerations, the NRC has revised the enforcement discretion policy proposed in SECY-01-0134 as follows:

Licensees may rely upon the information gathered by previous licensees regarding an individual applicant's past five years of employment to meet the suitable inquiry requirement. Because licensees now share information from the suitable inquiries they have conducted, as well as information about an individual's compliance with the licensee's FFD policy during the period authorization is held at each site, the NRC believes that relying upon the information gathered by previous licensees provides adequate safety.

If an individual's authorization has been interrupted for 30 calendar days or less and the individual's last authorization was terminated favorably ( i.e. , the individual did not violate the licensee's FFD policy), before granting authorization for unescorted access to the protected area of a nuclear power plant or assigning the individual to perform activities within the scope of part 26, the licensee shall:

(1) Obtain and verify that a self-disclosure ( i.e. , a report of any drug-or alcohol-related arrests) for the period since the last authorization contains no potentially disqualifying FFD information, unless the individual was subject to a licensee-approved behavioral observation and arrest-reporting program throughout the period of interruption; and

(2) Ensure that the individual has met FFD refresher training requirements.

If an individual's authorization has been interrupted for 31 days to 60 days and the individual's last authorization was terminated favorably, in order to grant authorization for unescorted access to the protected area of a nuclear power plant or assigning the individual to perform activities within the scope of part 26, the licensee shall:

(1) Obtain and verify that a self-disclosure for the period since the last authorization contains no potentially disqualifying FFD information, unless the individual was subject to a licensee-approved behavioral observation and arrest-reporting program throughout the period of interruption;

(2) Within 5 working days of granting authorization, complete a suitable inquiry for the period since last authorization was terminated by contacting every interim employer, unless the individual was subject to a licensee-approved behavioral observation and arrest-reporting program throughout the period of interruption;

(3) Verify that results of an alcohol test are negative and collect a specimen for drug testing, unless either a drug and alcohol test meeting the standards of part 26 was performed within the past 60 days and results were negative, or the individual was subject to a licensee-approved part 26 FFD program that included random drug and alcohol testing throughout the period of interruption; and

(4) Ensure that the individual has met FFD refresher training requirements.

This revised enforcement discretion policy addresses not only short breaks of 30 days or less, but also an interruption of 31 days to 60 days. In SECY-01-0134, the proposed enforcement discretion for reinstatement or transfer indicated that the individual must be subject to a part 26 program for “at least 30 of the previous 60 days” to be exempt from a pre-access test. The revised enforcement discretion policy addresses interruptions up to 60 days, provides a graded approach to pre-access testing, and ensures consistency with the requirement that licensees perform “testing within 60 days prior to the initial granting of unescorted access to protected areas or assignment to activities with the scope” of part 26. In addition, the revised enforcement discretion policy is consistent with the interruption periods that are being used in the draft FFD rule ( http://ruleforum.llnl.gov ).

This revised enforcement discretion policy has several advantages over the enforcement discretion policy proposed in SECY-01-0134. Specifically, this policy:

(1) Provides greater assurance that individuals granted unescorted access to nuclear power plants are trustworthy and reliable;

(2) Provides greater alignment between the interim enforcement discretion policy and the future FFD rule;

(3) Achieves greater consistency between FFD and access authorization guidance;

(4) Allows licensees to take credit for the suitable inquiries conducted by previous licensees;

(5) Reduces the ambiguity in the current rule regarding the NRC's expectations for managing transfers of personnel between sites;

(6) Minimizes the unnecessary burden of redundant regulatory requirements; and

(7) Takes a graded approach to updating and reinstating authorization for individuals whose authorization has been interrupted for up to 60 days.

Further, the revision recognizes that the potential risks of updating or reinstating an individual who has recently held authorization, or has been subject to the majority of the elements of a part 26 FFD program, are less than those presented by an unknown and unmonitored individual, for whom the current regulations allow up to 60 unmonitored days between the pre-access test and the authorization to perform activities within the scope of part 26. The NRC believes these measures will maintain safety and increase the overall efficiency and effectiveness of the licensees' part 26 programs, while reducing unnecessary regulatory burden.

The NRC does not intend to pursue past violations for insufficient suitable inquiries (where licensees failed to contact employers when individuals had worked for employers for less than 30 days) and past violations for failures to perform pre-access drug tests (where individuals were subject to a FFD program within the last 30 days). The NRC believes that this exercise of enforcement discretion is appropriate because:

(1) Individuals who currently have authorization under the past suitable inquiry pre-access testing practices have successfully maintained their authorizations while subject to part 26 FFD programs over time;

(2) Pursuing past violations would not be an effective and efficient use of NRC resources; and

(3) Requiring licensees to conduct new suitable inquiries and pre-access tests would represent undue regulatory burden.

In conclusion, the NRC believes that the practices included in this interim enforcement policy will ensure adequate protection of public health and safety and nuclear security.

Accordingly, the proposed revision to the NRC Enforcement Policy reads as follows:

The FAA has received reports indicating fractures of the carriage spindles of the outboard mid-flaps on certain Boeing Model 737 series airplanes. The fractures resulted from stress-corrosion cracking. The most critical section for a fracture is at the forward end of the spindle; two of the thirteen reported fractures occurred in this area on airplanes that had accumulated between 4,198 and 43,919 total flight cycles. In a recent incident, dual failure of the carriage spindles occurred and one of the spindles failed at a location critical for continued flap functionality. If one carriage spindle fractures on a flap, it will affect control of flight of the airplane. If both the inboard and outboard spindles fracture in the critical section on an outboard flap, it could result in loss of controllability of the airplane.

This AD is related to AD 90-17-19, amendment 39-6705 (55 FR 33280, August 15, 1990). That AD is applicable to all Boeing Model 747 series airplanes, except Model 747SP, and requires periodic inspections of both inboard and outboard trailing edge flap carriage spindles for cracks and corrosion, and overhaul or replacement, if necessary. That AD also requires periodic inspections to detect cracks or corrosion of all exposed surfaces of the carriage spindles, including inner bore, and aft links; and overhaul or replacement, if necessary. That AD also shortens certain compliance intervals to ensure continued airworthiness.

This AD requires similar actions for all Boeing Model 737-100, -200, -200C, -300, -400, and -500 series airplanes, because the carriage spindles on the outboard mid-flaps are very similar to the carriage spindles on Model 747 series airplanes.

We have reviewed and approved Boeing Alert Service Bulletin 737-57A1277, dated July 25, 2002, which describes procedures for repetitive nondestructive test (NDT) inspections to find cracks, fractures, or corrosion of each carriage spindle of the left and right outboard mid-flaps; and corrective action, if necessary. The corrective action includes overhaul or replacement of the carriage spindle if any cracks, fractures, or corrosion are found. The service bulletin also recommends that a report be sent to the manufacturer if a crack or fracture of any carriage spindle is found. Accomplishment of the actions specified in the service bulletin is intended to adequately address the identified unsafe condition

Since an unsafe condition has been identified that is likely to exist or develop on other airplanes of the same type design, the actions in this AD are required to be accomplished in accordance with the service bulletin described previously, except as discussed below.

The service bulletin explicitly specifies doing a NDT inspection for cracks or fractures of each carriage spindle, and indicates that operators should look for cracking or corrosion of the exposed portion of the spindle. We infer that this description is that of a general visual inspection; therefore, this AD adds a general visual inspection for cracks, fractures, or corrosion of the spindle. We have added a note to this AD to define such an inspection.

Although the service bulletin recommends that operators report inspection findings of any crack or fracture in the carriage spindle to the manufacturer, this AD does not contain such a reporting requirement.

This is considered to be interim action. We are currently considering mandating overhaul or replacement of the carriage spindles, which will extend the interval for the repetitive inspections required by this AD action. This action is similar to that required by AD 90-17-19, discussed above. However, the planned compliance time for the overhaul or replacement action is sufficiently long so that notice and opportunity for prior public comment will be practicable.

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

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

Submit comments using the following format:

• Organize comments issue-by-issue. For example, discuss a request to change the compliance time and a request to change the service bulletin reference as two separate issues.

• For each issue, state what specific change to the AD is being requested.

• Include justification ( e.g. , reasons or data) for each request.

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

Commenters wishing the FAA to acknowledge receipt of their comments submitted in response to this rule must submit a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket Number 2002-NM-214-AD.” The postcard will be date stamped and returned to the commenter.

The regulations adopted herein will not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, it is determined that this final rule does not have federalism implications under Executive Order 13132.

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

Accordingly, pursuant to the authority delegated to me by the Administrator, the Federal Aviation Administration amends part 39 of the Federal Aviation Regulations (14 CFR part 39) as follows:

The Customs laws impose certain requirements upon vessels that will arrive in the United States to discharge their cargo. In particular, vessels destined for the United States must comply with 19 U.S.C. 1431, which requires that every vessel bound for the United States and required to make entry under 19 U.S.C. 1434 have a manifest that meets the requirements that are prescribed by regulation. To this end, under 19 U.S.C. 1431(d), Customs may by regulation specify the form for, and the information and data that must be contained in, the vessel manifest, as well as the manner of production for, and the delivery or electronic transmittal of, the vessel manifest.

Currently, § 4.7, Customs Regulations (19 CFR 4.7), requires: That the master of every vessel arriving in the United States and required to make entry have on board the vessel a manifest in accordance with 19 U.S.C. 1431 and § 4.7; and that an original and one copy of the manifest must be ready for production upon demand and must be delivered to the first Customs officer who demands the manifest. Sections 4.7(a) and 4.7a, Customs Regulations (19 CFR 4.7(a) and 4.7a), set forth the documentary and informational requirements that constitute the vessel manifest.

Pursuant to § 4.7(a), the cargo declaration (Customs Form 1302 or its electronic equivalent) is one of the documents that comprises a vessel manifest. The cargo declaration must list all the inward foreign cargo on board the vessel regardless of the intended U.S. port of discharge of the cargo (§ 4.7a(c)(1)).

Furthermore, 19 U.S.C. 1448 provides, in pertinent part, that no merchandise may be unladen from a vessel which is required to make entry under section 1434 until Customs has issued a permit for its unlading. In addition, under section 1448, Customs possesses a reasonable measure of regulatory discretion as to whether, and under what circumstances and conditions, to issue a permit to unlade incoming cargo from a vessel arriving in the United States. Section 4.30, Customs Regulations (19 CFR 4.30), lists the requirements and conditions under which Customs may issue a permit to unlade foreign merchandise from a vessel arriving in the United States.

In addition, 19 U.S.C. 1436(a)(1) and (a)(4) provide that it is unlawful to fail to comply with sections 1431, 1433 or 1434 or any regulation prescribed under any of those statutory authorities. Moreover, 19 U.S.C. 1436(a)(2) states that it is unlawful to present or transmit, electronically or otherwise, any forged, altered or false document, paper, data or manifest to the Customs Service under 19 U.S.C. 1431, 1433(d) or 1434. Under section 1436(b), the master of a vessel who commits any such violation is liable for a civil penalty of $5,000 for the first violation and $10,000 for each subsequent violation and any conveyance used in connection with any such violation is subject to seizure and forfeiture.

By a document published in the Federal Register (67 FR 51519) on August 8, 2002, Customs proposed to amend § 4.7 to provide that, pursuant to 19 U.S.C. 1431(d), for any vessel subject to entry under 19 U.S.C. 1434 upon its arrival in the United States, Customs must receive the vessel's cargo manifest (declaration) from the carrier 24 hours before the related cargo is laden aboard the vessel at the foreign port. The proposed rule also enumerated the specific informational elements that would need to be included in the submitted cargo manifest.

As explained in the preamble of the Notice of Proposed Rulemaking (67 FR at 51520), the United States Customs Service recently launched the Container Security Initiative (“CSI”). CSI will secure an indispensable, but vulnerable link in the chain of global trade: Containerized shipping. Approximately 90% of world cargo moves by container; 200 million cargo containers are transported between the world's seaports each year, constituting the most critical component of global trade. Nearly half of all incoming trade to the United States (by value) arrives by ship, and most of that is in sea containers. Annually, nearly 6 million cargo containers are offloaded at U.S. seaports.

There is, however, virtually no security for this critical global trading system. And the consequences of a terrorist incident using a container would be profound. As experts like Dr. Stephen E. Flynn, Senior Fellow, Council on Foreign Relations, have pointed out repeatedly, if terrorists used a sea container to conceal a weapon of mass destruction—a nuclear device, for example—and detonated it on arrival at a port, the impact on global trade and the global economy would be immediate and devastating. All nations would be affected because there would be no mechanism for identifying weapons of mass destruction before they reached our shores and before they posed a threat to the global economy.

AI Qaeda and other terrorist organizations pose an immediate and substantial threat. And the threat is not just to harm and kill American citizens, it is a threat to damage and destroy the U.S. and the world economy.

To address the threat terrorists pose to containerized shipping, Customs developed CSI. Under CSI, U.S. Customs is working with other governments to identify high-risk cargo containers and pre-screen those containers at the foreign ports before they are shipped to the U.S. CSI has four core elements:

(1) Identify “high-risk” containers. In connection with its domestic targeting efforts, Customs has already established criteria and automated targeting tools for identifying “high risk” shipments. Indeed, every one of the shipments that arrives in the United States by sea container is currently assessed for risk using these tools and advance manifest data. If this data were provided earlier, Customs could use these same tools to detect high risk shipments before they were carried to the United States. Accordingly, to enhance domestic targeting and to enable overseas targeting and screening of containers, Customs has proposed a rule requiring accurate and detailed information to be transmitted before shipments are laden on vessels destined for the United States.

(2) Pre-screen containers before they are shipped. As discussed above, to protect the United States and global trade from the risks posed by international terrorists, security screening should be done at the port of departure rather than the port of arrival.

(3) Use technology to screen high-risk containers. Technology enables screening to be done rapidly without slowing down the movement of trade. This technology includes large-scale x-ray and gamma machines and radiation detection devices.

(4) Use more secure containers to ensure the integrity of containers screened overseas.

CSI thus offers real protection, on a day-to-day basis, for the primary system of international trade—a system on which all economies depend. Given the security afforded by CSI, the investments made by ports and members of the trade to implement CSI represent relatively inexpensive forms of insurance against the terrorist threat. In the event of an attack using a cargo container, the CSI network of ports will be able to remain operational because those ports will already have an effective security system in place—one that will deter and prevent terrorists from using it. Without such a network, the damage to global trade caused by a terrorist attack involving international shipping would be staggering.

In addition to protecting global trade, CSI should facilitate the flow of that trade. When a container has been pre-screened and sealed under CSI, U.S. Customs will not, absent additional information affecting its risk analysis, need to inspect it for security purposes when it reaches the U.S. Moreover, this system could reduce the processing time for certain shipments because the screening at a CSI port will in most cases take place during “down time.” Most containers sit on a terminal for an average of several days prior to lading. This window of “down time” will be used to screen containers for security purposes. On arrival at the U.S. seaport, the CSI-screened container should be released immediately by U.S. Customs, which could shave hours, if not days, off of the shipping cycle. In this manner, CSI should increase the speed and predictability for the movement of cargo containers shipped to the U.S.

For these reasons, CSI is a critical component of the President's Homeland Security Strategy. It has also been endorsed by the G-8 as well as the World Customs Organization.

As a result of this broad support, CSI has been expanding rapidly. When Customs launched CSI this past January, the first step was to implement CSI as quickly as possible in Canada and the top 20 ports (by volume) that ship to the United States. When fully implemented in these locations, CSI will substantially increase the security of the United States and the global trading system because the top 20 ports alone account for nearly 70% of all the containers shipped to U.S. seaports. To date, Canada, the Netherlands, Belgium, France, Germany, Singapore, Hong Kong, and Japan have agreed to implement CSI. These countries represent 11 of the top 20 ports. Customs anticipates that several other nations will agree to implement CSI in the near term, and that CSI will expand beyond the top 20 ports during the next year.

CSI is already operational in Canada and the Netherlands. It will be implemented at several additional ports within the next 90 days. Given this explosive growth, it is critical that the information necessary to implement CSI fully be provided to Customs in the near term. For this reason, Customs proposed this rulemaking on August 8, 2002 and, following the comment period, is issuing this final rule today.

Under the proposed rule, the conditions of the International Carrier Bond (19 CFR 113.64) were proposed to be amended to recognize the status of a Non-Vessel Operating Common Carrier (NVOCC) as a manifesting party and to obligate any NVOCC having such a bond and electing to provide cargo manifest information to Customs electronically under § 4.7 and 4.7a to accurately transmit such information to Customs 24 or more hours before the related cargo is laden aboard the vessel at the foreign port. Breach of these obligations would result in liquidated damages against the NVOCC. For purposes of the proposed rule, a non-vessel operating common carrier (NVOCC) as a common carrier that does not operate the vessels by which the ocean transportation is provided, would be considered a shipper in its relationship with an ocean common carrier.

If the master of a vessel failed to present or transmit accurate manifest data in the required time period or presented or transmitted any false, forged or altered document, paper, manifest or data to Customs, the proposed regulations specified that monetary penalties could be assessed under the provisions of 19 U.S.C. 1436(b). Likewise, if an NVOCC having an International Carrier Bond elected to transmit such data electronically to Customs and failed to do so in the required time period or transmitted any false, forged or altered document, paper, manifest or data to Customs, the NVOCC could be liable for the payment of liquidated damages for breach of the conditions of the International Carrier Bond, in addition to any other applicable penalties.

The proposed rule also provided that if the carrier did not present cargo declaration information to Customs prior to the lading of the cargo aboard the vessel at the foreign port, Customs could, in addition to assessment of civil monetary penalties, delay issuance of a permit to unlade the entire vessel or a portion thereof until all required information was received.

Finally, it was proposed that § 4.8 be amended to make clear that the granting of preliminary entry by Customs would be conditioned upon the electronic submission of the Cargo Declaration (Customs Form (CF) 1302), as well as the provision to Customs either electronically or in paper form of all other forms required by § 4.7.

A total of 78 commenters responded to the notice of proposed rulemaking. Nearly all of the commenters recognized the need to act immediately to protect the global trading systems, and in particular to protect the most important element in the movement of international trade—containerized cargo. They also recognized the urgency and seriousness of the threat posed by terrorist organizations and the smuggling of weapons of mass destruction, including radiological and nuclear materials. They complimented the Customs Service on newly created programs such as the Customs-Trade Partnership Against Terrorism (C-TPAT) and the Container Security Initiative (CSI), which are designed to address this threat.

Most commenters questioned how the regulation would be implemented. They raised operational issues regarding the movement of containers, the security of containers and the interfaces between the U.S. Customs Service and the trade. They also noted that the regulation would require changes to existing business practices that could take several months to fully implement.

While the aim of this regulation is to better secure containerized cargo from the threat of terrorism, it is important to note that carriers, shippers, importers and others should realize significant benefits from its implementation. Most notably, once a cargo container is pre-screened in a foreign port, in the absence of additional information affecting Customs risk analysis, Customs will rarely need to again screen the container or inspect its contents for security purposes upon arrival in the United States. This offers greater predictability for freight forwarders and importers to arrange for transportation upon discharge of the cargo. This and other benefits, however, will only be fully realized after the Customs Service is able to pre-screen containers overseas, using the accurate and complete information required by this regulation.

We have carefully considered all of the comments, and as a result, we have modified the proposed regulation in many respects. For example, many commenters questioned the need to include bulk shipments under the proposed regulation. After considering these comments, we have modified the proposed regulation to exempt bulk shipments from its requirements. Others requested greater assurances of confidentiality. In response, we will be taking steps appropriately to protect business sensitive information.

In addition, we have considered the comments about the need for additional time to implement the reporting requirements because of potential changes in business practices. Balancing these comments against the pressing need to protect the national security of the United States and to protect the safe and secure movement of international trade, we have decided to not initiate any enforcement actions such as assessing penalties for non-fraudulent violations of this regulation for 60 days after the regulation goes into effect. There is an overriding national security need, however, to move as quickly as possible to protect the United States and the global trading system from terrorism, especially the profound threat of nuclear terrorism.

Though enforcement actions for non-fraudulent violations of this regulation will not be initiated for 60 days after the regulation goes into effect, the U.S. Customs Service is prepared to receive automated manifest information immediately, which would allow Customs to offer facilitation benefits to those customers of carriers and NVOCCs that utilize CSI ports.

We have made a good faith effort to make changes to the rule where appropriate at this time, but we recognize that not all of the modifications suggested by commenters relate to changes in the regulation itself, and that not all potential implementation issues could be foreseen. In the interest of maintaining an open dialogue with affected parties, and consistent with the long-standing Customs practice of working with the trade, Treasury is inviting the Advisory Committee on the Commercial Operations of the U.S. Customs Service (COAC) to convene a special subcommittee to advise the U.S. Customs Service on operational issues arising out of the implementation of this regulation.

A complete description of the various issues raised by the commenters, together with Customs response to these issues, is set forth below.

Comment: Twenty-one commenters questioned the validity of the proposed advance cargo manifest regulations under 19 U.S.C. 1431 in light of section 343(a) of the Trade Act of 2002 (Public Law 107-210; 116. Stat. 933), that was enacted on August 6, 2002. Section 343(a) concerns the mandatory filing with Customs of advanced electronic information for cargo being imported into or exported from the United States by vessel, vehicle or aircraft. These commenters contend that the proposed advance cargo manifest regulations are in direct contradiction with the requirements imposed under section 343(a)(3) of the Trade Act of 2002. The underlying premise essentially asserted in this context is that Congress, in enacting section 343 of the Trade Act, effectively repealed any authority that Customs might have had to request advance manifest information under 19 U.S.C. 1431.

Customs Response: Customs has concluded that both 19 U.S.C. 1431 and section 343(a) of the Trade Act of 2002 co-exist within the Customs laws and the enactment of section 343(a) of the Trade Act did not and was not intended by Congress to implicitly repeal Customs authority to collect manifest information under section 1431. Briefly stated, therefore, Customs retains the authority under section 1431(b) and (d) to require the advance presentation of vessel cargo manifest information in accordance with the regulations being issued today.

In addition, Customs will issue regulations, in accordance with section 343(a) of the Trade Act of 2002, that will require the advance electronic transmission of information on cargo destined for importation into the United States by vessel, vehicle or aircraft. In this regard, Customs will reconcile those regulations that are issued under the authority of section 343(a) with the regulations that are being issued today under the authority under 19 U.S.C. 1431.

Comment: Several commenters inquired as to whether the 24 hour rule would apply to bulk and break bulk cargo. Many commenters requested that only certain data elements be required for such manifest submissions. Others commented that the Coast Guard 96 hour report of arrival requirements should be used for bulk and break bulk carriers for manifest submission to U.S. Customs in the United States.

Customs Response: Customs has determined that the proposed rule will be amended in this final rule to provide that bulk cargo as defined in the rule will be exempt from the 24 hour rule; and, further, that break bulk cargo may be exempted from the 24 hour rule on a case by case basis. Companies that are exempted from the 24 hour rule must submit their cargo declaration information to U.S. Customs 24 hours prior to arrival in the U.S. if they are participants in the vessel AMS program or upon arrival if they are non-automated carriers. In response to the comment that the Coast Guard 96 hour report of arrival requirements should be used, the Coast Guard has merely proposed that requirement at this time. While Customs agrees with the idea, this cannot be implemented until the Coast Guard requirement is adopted.

First, regarding bulk cargo, Customs defines such cargo as homogeneous cargo stowed in bulk, that is to say, loose in the hold and not enclosed in any container such as boxes, bales, bags, casks, and so on. It is also called bulk freight. Reference to a maritime dictionary reveals bulk cargo to be composed of (1) free flowing articles such as oil, grain, coal, ore, and so on, which can be pumped or run through a chute or handled by dumping; (2) articles that require mechanical handling such as bricks, pig iron, lumber, steel beams and so on.

Second, Customs also recognizes that there are concerns that carriers have with other types of cargo known as break bulk. Break bulk is cargo that is not containerized, but which is otherwise packaged or bundled. This type of cargo may raise the same types of concealment and smuggling concerns as containerized cargo. Consequently, as indicated above, a carrier of break bulk cargo may apply for an exemption from the 24 hour rule; Customs will evaluate each application on a case by case basis.

To apply for an exemption, the carrier must submit a written request for exemption to the U.S. Customs Service, National Targeting Center, 1300 Pennsylvania Ave., NW., Washington, DC 20229. Until an application for an exemption is granted, the carrier must comply with the 24 hour advance manifest requirement. The written request for exemption must clearly set forth information such that Customs may assess whether any security concerns exist, such as: The carrier's IRS number; the source, identity and means of the packaging or bundling of the commodities being shipped; the ports of call, both foreign and domestic; the number of vessels the carrier uses to transport break bulk cargo, along with the names of these vessels and their International Maritime Organization numbers; and the list of the carrier's importers and shippers, identifying any who are members of C-TPAT (The Customs-Trade Partnership Against Terrorism).

If Customs, by written response, provides an exemption to a break bulk carrier, the exemption is only applicable under the circumstances clearly set forth in the application for exemption. If circumstances set forth in the approved application change, it will be necessary to submit a new application.

Customs may rescind an exemption granted to a carrier at any time.

As noted above, companies receiving exemptions must submit their cargo declaration information to U.S. Customs 24 hours prior to arrival in the U.S. if they are participants in the vessel AMS program or upon arrival if they are non-automated carriers.

Comment: In the August 8, 2002, proposed rule, Customs stated that Non Vessel Operating Common Carriers (NVOCC) licensed by the Federal Maritime Commission (FMC) would be eligible to become bonded with Customs and to electronically transmit manifest information directly to Customs. Several commenters pointed out that a separate category of NVOCC is not licensed by the FMC, but rather is registered with the agency. This latter group, unless identified by Customs as eligible to participate, would be unable to transmit information directly to Customs prior to foreign lading. It is requested that Customs allow registered NVOCCs to participate. In addition, one commenter advocated that shippers' associations, like NVOCCs, should be authorized to present the required manifest information electronically to Customs.

Customs Response: Customs agrees that to the extent that members of the NVOCC community registered with the FMC become bonded with Customs, they should be included in the electronic filing program. Customs in this final rule has amended the proposed regulatory language in this regard to reflect this change. However, shippers' associations may not participate in the electronic filing program. Such associations of shippers are membership-only groups that are not currently regulated under U.S. law, and they are not licensed or registered with the FMC.

Comment: A number of commenters addressed the issue of the confidentiality of certain manifest information. The views expressed really concerned two different aspects of the need for confidentiality—that involving business and competitive advantage and that involving the matter of cargo security.

One group, consisting primarily of the Non Vessel Operating Common Carrier (NVOCC) community, expressed concerns that the information which would be supplied to Customs under the proposed new procedures would be subject to release for publication. It was stated that such release would reveal confidential business information which could result in harm to the NVOCC community. It was suggested that NVOCC filers should be permitted to make biennial confidentiality certifications to Customs on behalf of the importers or consignees, pursuant to statute, which allows only the importers or consignees to submit biennial certifications for confidentiality of certain manifest information. It was also suggested that Customs should consider an NVOCC to be an “attorney in fact” for certification filing purposes since our regulations currently allowed an attorney of an importer or consignee to submit a certification on behalf of that importer or consignee.

The second confidentiality concern expressed by commenters involved the matter of the security of the cargo itself. It was suggested that if Customs released certain manifest information shortly after its receipt, information identifying cargoes could be published even before vessels departed foreign ports bound for the United States.

Customs Response: Customs recognizes the confidentiality concerns stated by these commenters. The premature disclosure of information about incoming cargo, particularly sensitive shipments, such as chemicals and the like, could not only undermine business relationships; it could also enable terrorist or criminal organizations, having advance information about incoming cargo, to attempt the theft or destruction of such cargo prior to or upon its arrival in the United States.

Accordingly, in response to these matters, Customs intends to address these concerns to the extent allowable under existing law. To this end, 19 U.S.C. 1431(c) limits the parties eligible to make a necessary confidentiality certification to include only importers and consignees. While our regulations currently allow an attorney of an importer or consignee to file a client's certification, Customs simply cannot designate an NVOCC to be an “attorney in fact” for certification filing purposes. Proposed amendments to Part 103 of the Customs Regulations (19 CFR part 103) would be necessary. Given this fact, Customs will be issuing a separate Federal Register Notice of Proposed Rulemaking in the near future to expand upon those parties who may file a biennial certification on behalf of the importer or consignee. An immediately available option, however, is for NVOCC manifest information filers to request appropriate importers and consignees in the United States to file certifications with Customs on their own behalf, thus protecting the same range of information which is sought to be protected here.

With regard to the concern that release of advance information prematurely can raise new security concerns, Customs will not be releasing information from cargo declarations until the complete manifest is filed with Customs. The statutory provision under consideration, 19 U.S.C. 1431(c), provides for the release for public disclosure of information, when contained in a vessel manifest. The statute does not specify when the information must be released to the public pursuant to 19 U.S.C. 1431(c). (Section 4.7 of the Customs Regulations (19 CFR 4.7) specifically identifies those documents comprising a vessel “manifest”; such documents comprising the vessel manifest include the Vessel Entrance or Clearance Statement (CF-1300); Cargo Declaration (CF-1302); Ship's Stores Declaration (CF-1303); Crew's Effects Declaration (CF-1304, or optional INS Form, I-418); Crew List and I-418; and, Passenger List with I-418.)

The August 8, 2002, document published in the Federal Register , by proposing to require advance filing of Cargo Declaration information, specifies that only a portion of a vessel's manifest, the CF 1302 information, must be presented or transmitted prior to foreign lading. This requirement goes only to certain data which is made part of the larger manifest requirement. The manifest itself is filed with Customs at the time of vessel entry in any of the various ports of the United States. No information can be said to be contained in a “vessel manifest” as provided in section 1431, until the complete manifest is made available to Customs. Therefore, the release of information from manifests must await their filing of the entire and complete manifest with Customs at the time of formal entry of vessels in the United States.

Comment: One commenter stated that the proposal to amend provisions of the Customs International Carrier Bond as presently set forth in § 113.64 (19 CFR 113.64) would be inappropriate since an NVOCC did not actually transport merchandise. Concern was also expressed that an NVOCC could be held accountable by Customs for delivery of cargo to an incorrect port of unlading by a carrier. Likewise, there was concern that an NVOCC could incur manifest violation penalties in instances where data was relayed to Customs by the NVOCC at least 24 hours in advance of scheduled vessel sailing time, but the vessel then loaded and departed earlier than scheduled.

Customs Response: It is the current practice that vessel agents in the United States carry continuous International Carrier Bond coverage (19 CFR 113.1). They, likewise, do not transport cargoes. They are bonded in order that Customs may be assured that the revenue is protected and that prompt satisfaction of any liabilities incurred in the course of their dealings with Customs may occur. Likewise, the NVOCC community will be dealing with Customs and will be required to provide the same level of assurance with respect to the correctness of the information they submit. Provided the NVOCC adequately demonstrates that cargo declaration information was timely submitted to Customs and the carrier then loaded the containers prematurely, the NVOCC will not be liable.

Comment: A commenter inquired as to how Customs would set bond amounts for NVOCC activities, and whether guidance to the ports would be forthcoming. The concern was that guidelines be made proportional to any claims for liquidated damages assessed against these parties.

Customs Response: Customs port directors retain discretion for setting bond amounts in their respective jurisdictions. Customs Headquarters does intend to issue policy guidance on bond coverage specific to NVOCC activity. As in the past, such guidance will establish a minimum bond amount to be required. Using their discretion under our regulations, port directors are authorized to set higher amounts based upon their experience in the ports of entry.

The guidelines provided to ports will not include guidance regarding proportionality of liquidated damages claims. Such claims are, as always, dependent upon the factual circumstances involved in any particular transaction relating to the breach of the bond conditions.

Comment: A few commenters addressed the issue of Customs granting permits to unlade merchandise in ports of the United States. The concern was that an entire vessel could be denied permission to unlade in circumstances where only a portion of the cargo was non-compliant with the rule on 24 hour advance notification to Customs. Port Authorities also expressed concern over potential port congestion.

Customs Response: The statute governing the issuance of permits to unlade merchandise in the United States, 19 U.S.C. 1448, expressly provides that no merchandise shall be unladen from any vessel until entry has been made and a permit for the unlading of the same has been issued by the Customs Service. To the extent that Customs has identified a portion of arriving cargo which has not been laden in accordance with the requirements of the regulations, Customs has the authority to process that portion differently from the remainder. Customs will allow unloading of that portion of the cargo that has been laden in accordance with the regulations, unless circumstances require otherwise.

Comment: Several commenters raised questions about various liability issues specifically relating to which party was legally responsible under penalty of law for submitting accurate manifest information to Customs; for any errors and omissions that were contained in submitted manifests; and for the failure to file manifests timely. Additionally, it was asked who would be responsible when manifested freight was left behind and was not delivered to the port for which it was manifested; or when diversions from or changes to the original port of call resulted in freight being delivered to a port other than the one for which the freight was manifested.

Customs Response: Customs may initiate penalty actions against any party responsible for providing the required information. For example, if a non-vessel operating common carrier (NVOCC) elects to participate in the vessel Automated Manifest System (AMS) and transmits its information directly to Customs, the NVOCC is the responsible party and will be held liable for any manifest information found to be untimely presented and/or containing errors or omissions. This would also be the case if the NVOCC manifested cargo and the cargo is left behind. Timely communication between the vessel carrier and the NVOCC is required in order for the NVOCC to amend its manifest information to accurately list the cargo that is on board the vessel. Likewise, effective communication between the vessel carrier and the NVOCC is essential for changes to the ports of call and diversions of the vessel.

If an NVOCC is a participant in the vessel AMS program, the NVOCC will be treated as a carrier for Customs purposes. Vessel operators who currently slot charter to other vessel AMS carriers will utilize the same procedures for notification that the slot charterer has used in providing its manifest to Customs. A slot charterer is a carrier leasing space on a vessel owned or operated by another carrier on a space available basis. The vessel operator is only responsible for ensuring that the NVOCC's Standard Carrier Alpha Code (SCAC), as described in 19 CFR 4.7a(c)(2)(iii), is included on the Customs Form (CF) 3171 that is presented to Customs. Failure to present the SCAC of all NVOCCs and slot charterers on board the vessel will result in a penalty against the vessel carrier under 19 U.S.C. 1436.

Comment: A number of commenters asked for confirmation that Customs would not require containers to be off loaded for examination once clearance to load had been given. It was asked who would be liable for the costs incurred if Customs required unloading of a container at an intermediate foreign port.

Customs Response: Customs will follow the current procedures for the examination of containers. Customs does not anticipate that a container already loaded in compliance with this rule would be required to be unloaded for examination except in exigent circumstances. In these rare instances, the carrier will be assessed the costs.

Comment: Several commenters questioned how the proposed rule would link to the Automated Commercial Environment (ACE) program and whether partial bill of lading information could be reported to Customs. It was also requested that Customs enlarge the scope of those participants who were eligible to provide manifest information to include brokers, shippers and importers.

Customs Response: The current system that Customs utilizes for electronic transmissions of vessel manifest data is the Vessel Automated Manifest System (AMS) which is a component of the Customs Automated Commercial System (ACS). This system will not allow for brokers, importers or shippers to input manifest information. Additionally, this system will not accept partial bill of lading data to be transmitted by the carrier. The carrier will receive a reject message on that bill of lading.

The ACE system is the new automated system being designed by Customs and it is in the developmental stages, consequently a precise answer as to how this will be handled under ACE is not available now. Working groups consisting of representatives from several Government agencies and the trade community have been continually meeting to ensure all issues and concerns are discussed and presented properly. The Trade Support Network (TSN) is one of these working groups and the appropriate subcommittee of the TSN will examine how the ACE program will meet the objectives of this rulemaking. Interested parties can get additional information as to the development of the ACE program at www.customs.gov. Users should select the Customs Modernization icon on the website, then type the letters “TSN” into the search box.

Comment: Several commenters referred to the need for vessel carriers to maintain an original/copy of the manifest on board the vessel.

Customs Response: The requirement to carry the paper manifest on board the vessel was waived during a Vessel Paperless Manifest Test. The test procedures will be amended by the effective date of this rule to state that vessel carriers must submit their cargo declaration information to Customs 24 hours prior to lading at a foreign port. The participants in the Vessel Paperless Manifest Test will not be required to maintain a paper copy of the manifest on board the vessel; however, one must be provided upon request. All carriers not participating in the test must maintain a paper copy of the complete manifest on board the vessel.

Comment: Several commenters inquired whether carriers would be required to submit a final manifest prior to arrival in order to be permitted to unlade or whether the individual manifest reports submitted in advance would suffice.

Customs Response: The distinction between a manifest and a cargo declaration must be appreciated. The cargo declaration is one of several documents which, when taken together, constitute a vessel manifest. In this rulemaking, by requiring the submission of cargo declaration information 24 hours prior to lading, Customs is eliminating the requirement for vessel carriers to submit an additional cargo declaration upon arrival in the United States. However, the remaining documents comprising the vessel manifest must be available for presentation upon entry of the vessel.

Comment: Various commenters sought clarification as to whether vessels operating from the U.S. Virgin Islands to the United States were included in the proposal. It was pointed out that shipments from the continental United States to Puerto Rico, Hawaii or Alaska would not be subject to the proposed advance manifest regulations.

Customs Response: Vessels destined to Puerto Rico, Hawaii, and Alaska from the continental United States are considered to be operating between points in the Customs Territory. The U.S. Virgin Islands is located outside the Customs Territory and therefore vessels departing from there to the U.S. are subject to the 24 hour advanced manifest rule.

Comment: A number of commenters asked if the proposed rule applied to military cargo or other government shipments.

Customs Response: Carriers of military cargo and other U.S. Government shipments are required to comply with the advance manifest regulations.

Comment: Several commenters requested clarification of the data elements required to be included on the cargo manifest.

Customs Response: Customs has revised the regulations to include additional explanation and descriptive information, where appropriate, for those data elements that must be contained in the vessel's cargo manifest.

Comment: Several commenters stated that requiring a precise description of the cargo would result in “dummy” information being presented to Customs and that certain data elements were not known until after the lading of containers. Additionally, if shippers were to attempt precise cargo descriptions, the result would be numerous corrections having to be made to the manifest as the vessel approached the United States.

Customs Response: The so called “dummy” cargo descriptions are exactly what Customs cannot accept because they undermine our efforts to target threats to national security. Therefore, Customs is now requiring accurate cargo descriptions. Generic descriptions, specifically those such as “FAK” (“freight of all kinds”), “general cargo,” and “STC” (“said to contain”) are not acceptable. Moreover, general characterizations such as “chemicals” or “foodstuffs” will be considered overbroad.

Comment: Several commenters requested clarification on whether the proposed rule required the consignee name to be listed, or if it required the consignee name only if one were already provided when cargo was presented for shipment. Clarification was specifically requested on: Whether the owner or owner's representative meant the cargo owner; if there were a consignee, whether the shipper could decline to disclose the consignee by naming the cargo owner; and, whether the owner was to be listed only if there were no consignee indicated.

Customs Response: The only time a consignee name would not be recorded is in the case of “to order” shipments where the merchandise is sold in transit. Many “to order” entities are listed as the consignee. A “to order” consignee is not the true consignee, but rather only an interested party, such as a bank, which is securing payment. Either the party holding title to the goods (the owner) or that party's representative has the real interest in a shipment. Accordingly, the owner or owner's representative is the party that must be listed in place of the consignee in the case of “to order” shipments. If the consignee's name is available, however, the shipper must disclose this information.

Comment: A number of commenters requested that Customs clarify which seal number had to be provided: The seal of the shipper, the seal of the shipping line, or the Customs seal. Other commenters requested clarification on whether all loaded containers had to have an affixed seal.

Customs Response: For all sealed containers, the number that must be identified is the seal number of the last person/company to load the container. Participants in C-TPAT (The Customs-Trade Partnership Against Terrorism) must affix seals to all loaded containers.

Comment: Some commenters asserted that it was impossible to report the “actual boarded quantities” as required by proposed § 4.7a(c)(4)(x) 24 hours before the cargo was “actually” boarded.

Customs Response: Customs recognizes the validity of the comments. Accordingly, we are removing this data element from the final rule. This matter will be addressed in a separate Federal Register Notice of Proposed Rulemaking concerning Manifest Discrepancy Report filing.

Comment: Commenters questioned whether the proposed rulemaking would put an end to “co-loading.” Co-loading would occur when several NVOCC firms combined their cargo for movement under one NVOCC's master bill of lading, and each NVOCC had its own sub-set of house bills of lading and related manifests. Specifically, the scenario was presented where an automated NVOCC co-loaded with a non-automated NVOCC and the non-automated NVOCC presented the container to the vessel carrier. The question posed in this context was whether the manifest information would remain confidential and not be provided to the vessel carrier. In addition, clarification was requested as to whether the shipper, consignee, and cargo description information from all NVOCC house bills of lading (Master NVOCC and co-loading NVOCC) had to be included in the advance cargo manifest filing.

Customs Response: The rulemaking will not put an end to co-loading. If an automated NVOCC co-loads with a non-automated NVOCC and the non-automated NVOCC presents the container to the vessel carrier, the automated NVOCC is required to present its own bill of lading for that shipment directly to Customs via vessel AMS. The non-automated NVOCC must fully disclose and present the required manifest information for the related cargo to the vessel carrier for presentation to Customs via vessel AMS. Automated NVOCCs will not be authorized to submit paper manifests to the vessel carrier. The automated NVOCC who is co-loading should be aware, however, that its shipment could be held for examination based on Customs not receiving timely manifest information in the United States.

If the situation is reversed and the non-automated NVOCC co-loads with the automated NVOCC with the automated NVOCC presenting the container to the vessel carrier, the automated NVOCC is required to transmit all bills of lading in the container via vessel AMS. Non-automated NVOCCs that have shipments as part of a co-loaded container must fully disclose and present the required manifest information for their cargo to the automated NVOCC who would be required to present this information to Customs via vessel AMS. Each individual shipment must be input into the vessel AMS program with each individual shipper and consignee being identified along with the cargo description. Bills of lading stating the non-automated NVOCC to be either the shipper or consignee or setting forth the cargo description as “consolidation” is not authorized.

Non-automated NVOCCs thus have two options to submit manifest information to Customs. The options are: (1) Submit manifest information, in paper, directly to the vessel carrier who is required to input all bills of lading from the non-automated NVOCC into the vessel AMS program; or (2) Become a participant in the vessel AMS program and submit manifest information to U.S. Customs either directly or through an automated Service Provider, Port Authority, or Vessel Agent. Only under the second option will the manifest information of a non-automated NVOCC remain confidential (not be disclosed to the vessel carrier). In any case, regardless of the option chosen, the non-automated NVOCC is required to abide by the 24 hour advance manifest rule.

As stated in 19 CFR 4.7a, NVOCCs that receive cargo in sealed containers from the shipper can rely on the shipper's declaration. This section provides specific language to be used with “shippers load and count.” However, in vessel AMS the shipper must be identified, not the NVOCC.

Comment: Several commenters indicated that vessel AMS needed to be programmed to allow for the ocean carrier to update certain data elements even if the ocean carrier had not initiated the data transmission. In addition, requests were made to allow for a single transmission of individual bills of lading to Customs.

Customs Response: The AMS program does not allow parties to change, add or delete manifest information on a transaction they have not initiated. Ocean carriers, NVOCCs and slot charterers need to communicate and provide lading information to the responsible parties in order to eliminate the possibilities that either cargo is laden on board without being properly manifested, or without appropriate changes being made to the bills of lading. The vessel AMS program was not designed to allow for the transmission of individual bills of lading, and such transmissions must be sent by batch. This matter is under review for inclusion in the ACE program.

Comment: Several commenters requested clarification of the procedures upon vessel arrival in the first U.S. port relating to manifest filing, and time frames for submitting to Customs a permit to unlade on Customs Form (CF) 3171.

Customs Response: Vessel carriers must submit their CF 3171s 48 hours prior to arrival in the United States. Except for participants in the vessel paperless manifest test, vessel carriers, NVOCCs and slot charterers are required to submit manifests for empty containers on board to U.S. Customs 24 hours prior to arrival in the United States.

Comment: Some commenters requested clarification on the process by which vessel carriers and NVOCCs, who were not automated, would present their paper manifests to Customs for both CSI and non-CSI ports. Clarification was also requested on the process for submitting manifest information to Customs during computer down times and when unsuccessful transmissions occurred.

Customs Response: In presenting paper cargo declaration information to Customs at a CSI port, the authorized representative for the vessel carrier is required to submit directly to U.S. Customs officials at a designated site for that CSI port. The exact procedures for this process will vary from country to country based on various agreements signed under the CSI program. Each CSI location will determine the process based on these agreements. The U.S. Customs Service will provide detailed information to the trade community upon completion of signed agreements in each of the CSI locations.

For those vessel carriers presenting paper cargo declaration information to Customs at non-CSI ports, the companies are responsible for ensuring that their cargo declaration information is provided to Customs in the United States 24 hours prior to lading at the foreign port. Facsimiles and non-AMS electronic messages sent directly to Customs are not authorized. Non-automated vessel carriers may either enlist the automated services of a Vessel Agent, Service Provider, local Port Authority, or a business partner in the U.S. The domestic party in receipt would deliver the cargo declaration information directly to Customs. Paper cargo declaration information must be presented to each intended U.S. port of arrival 24 hours prior to lading at a foreign port. However, due to the fact that the non-automated vessel carrier has elected to submit paper cargo declaration information directly to Customs in the United States, the non-automated carrier is responsible for ensuring that complete cargo declaration information for each port of call in the United States (via the paper procedure outlined in the paragraph below) is submitted to each Customs location for review 24 hours prior to lading at the foreign port. Failure to do so could result in penalties or denial of unlading privileges.

In presenting cargo declaration information to Customs, a non-automated vessel carrier may utilize an automated domestic Vessel Agent, Service Provider, or Port Authority; or the non-automated carrier may utilize either an automated or non-automated business partner. Where the carrier utilizes an automated party to present cargo declaration information electronically to Customs, notification of holds will be conducted via the vessel AMS program. However, if a non-automated vessel carrier chooses to submit its information via a domestic representative using paper, Customs will notify the local U.S. representative of any holds. This notification will be indicated on a document that the local representative may pick up at the Customs port offices. It will be the local U.S. representative's responsibility either to provide necessary information to the ocean carrier or to provide a copy of relevant documentation to the foreign entity who in turn must provide a copy to the ocean carrier. Port directors in local ports will provide the details on the location for submitting paper cargo declaration information and the location and time that the notification document can be obtained.

In presenting cargo declaration information to Customs, non-automated NVOCCs may utilize an automated Service Provider, Vessel Agent, or Port Authority; however, a non-automated NVOCC may not utilize a non-automated business partner. U.S. Customs will not accept paper cargo declaration information from any automated party, which has originated from a non-automated NVOCC.

With reference to unsuccessful transmissions through the vessel AMS program, Customs conducts testing programs with the participants prior to their going on-line to ensure that their computers are both sending and receiving accurate messages. Customs will not allow a company to go on-line if they have not successfully completed this testing program.

The down time issues that have been raised are outlined in current Customs Directive 3240-075, Vessel Automated Manifest System, that is available to the trade community. Current acceptable down time is 2 hours; however, it is within the port director's discretion to allow more than the recommended 2 hours if circumstances warrant. Carriers whose systems are down for extended periods of time should notify their assigned client representative and refer to the procedures outlined in the directive on how to submit paper cargo declaration information to Customs.

Comment: Various commenters asked that Customs authorize exemptions for submission of any data elements which were viewed as being out of the control of an NVOCC.

Customs Response: The vessel AMS program will not accept an absence of data elements. If all required information is not entered, the vessel AMS program will send a rejection message to the transmitting party. We note that there are slot charterers who are automated and who have been consistently operating without any difficulty. Vessel carriers, NVOCCs and slot charterers must have procedures in place so that if containers have been manifested by an NVOCC or a slot charterer and subsequently are not laden, the vessel carrier must notify the NVOCC or slot charterer in order that they may amend their manifests to show corrected information.

Comment: Some commenters inquired as to how Customs would know when goods had been laden since the lading process was one that occurred over a period of time.

Customs Response: Customs considered requiring an additional data element for carriers to indicate the estimated time of lading. It was determined that such a requirement would be an additional burden to the carriers, and potentially unnecessary. Carriers understand the logistics of their business, and Customs will rely on them to provide the required information 24 hours prior to lading. Indeed, they have every incentive to do so—in addition to penalties, any carrier that begins the lading process without providing manifest information 24 hours before will be required to remove any containers that are identified for examination and which have already been laden.

Comment: Several commenters asked about the procedures needed to identify the initial manifest transmission to Customs and when amendment transmissions were made to the manifest.

Customs Response: The vessel AMS program has a transaction screen that allows the inspector to view all postings against each bill of lading. This means that each time a bill of lading is changed, added or deleted, Customs receives these transactions.

Comment: A few commenters requested clarification on how the ocean carrier would determine if an automated NVOCC had submitted manifest information directly to Customs.

Customs Response: Vessel AMS has a field identified as the Second Notify Party. The Second Notify Party lets the vessel carrier know when a bill is on file, and gives the vessel carrier the hold messages as well as all associated releases. Although this has not been a mandatory field in the past, Customs will now require this field to be completed by all automated NVOCCs and slot charterers.

Comment: It was asserted that if a hold notification were not sent to the carrier at the port of loading but rather to an NVOCC located in a different time zone from the carrier, it would affect being able to respond rapidly to requests from Customs. It was observed that different time zones could cause confusion as to when the 24 hour period had expired.

Customs Response: Carriers and NVOCCs will have to establish lines of communication for such circumstances. Customs will send notifications of a bill of lading on file to the party that provided the information to Customs in vessel AMS. The bill on file with Customs has a date and time stamp in vessel AMS, using Eastern Standard Time. Additionally, utilization of the Second Notify Party function in vessel AMS will allow for provision of additional information to the vessel carrier when an automated NVOCC or slot charterer receives hold messages on containers.

Comment: Several commenters requested that carriers be given confirmation for every container or shipment that Customs approved for lading. Some commenters inquired as to whether an absence of notification to carriers by Customs would serve as an authorization for lading. Other commenters requested that carriers be allowed to begin lading after a specified period of time, but prior to the expiration of the 24 hour period.

Customs Response: Customs agrees in principle with the notion of providing electronic confirmation messages to carriers which would authorize the lading of containers. However, the necessary programming cannot be accomplished before the regulations are implemented. Research will be undertaken to determine whether this capability in the vessel AMS program is feasible.

Until the completion of work in vessel AMS allowing confirmation messages, Customs will not allow lading prior to expiration of the 24 hour period and will utilize the current operating procedures under which filers receive hold messages only.

Comment: Numerous commenters questioned the viability of obtaining detailed manifest information 24 hours prior to loading of cargo on board a vessel. In this respect, some commenters expressed concern over the impact of the requirement on the efficiency of their commercial operations, while other commenters focused more on the financial impact of the 24 hour requirement on their operations.

A major concern was that movement of cargo would be disrupted and/or delayed due to the detailed level of manifest information required because the information may not readily be available before cargo is loaded onto a vessel. It was feared that the new requirements could cause cargo to miss sailing dates and remain at docks which did not have adequate security or space available to store containers.

The issue concerning financial impact involved changing business practices such as: Routing of vessels, work practices, personnel increases, automation costs including the cost of acquiring a bond, and the leasing of storage facilities.

Customs Response: With regard to the concern that the proposed rule may adversely affect the efficiency of international shipping operations, Customs recognizes this legitimate concern and has taken at least three steps to address it in the development of the CSI and this rulemaking. First, it is important to note that it is the information about the contents of a shipping container, not the container itself, that must be presented to Customs 24 hours prior to lading at a foreign seaport. Under this rule, so long as the required information is provided to Customs 24 hours in advance of lading, the container itself may be brought to the seaport at a later time. Second, the development of this rule and the CSI have been designed to take advantage of the existing shipping cycle. In most foreign seaports, containers destined for the United States are often stored at terminals for several hours or several days before lading. This provides ample opportunity for Customs and its foreign CSI partners to identify and screen potentially high-risk containers within the normal shipping cycle and without causing any unnecessary delays. Third, as noted above, by screening potentially high-risk containers at foreign seaports during the normal shipping cycle, Customs should be able to significantly expedite the movement of containers upon arrival in the United States. This should not only reduce delays associated with targeting and screening containers upon arrival in the United States, it should also add greater predictability to the movement of containers through domestic seaports.

Customs recognizes that some changes to business practices may be required in order to transmit the manifest data required under this rule. For example, although much, if not all, of the data required by Customs is available prior to lading because it is derived from information in the possession of carriers and NVOCCs or contained in the commercial documents generated prior to lading, Customs recognizes that businesses may not currently be configured to collect and transmit such information in compliance with the rule. This is one of the reasons that Customs has elected to phase-in enforcement of the rule over a 60 day period after the regulation goes into effect—to strike an appropriate balance between the needs of business and the need of the government to address the immediate threat that international terrorist organizations pose to the United States and the global economy.

Customs also recognizes that not all potential changes to supply chain or business practices can be anticipated in the promulgation of a proposed rule or in the comments it generates. Accordingly, Customs will carefully monitor the implementation of the rule and, as noted above, Treasury is inviting COAC to create a subcommittee to advise Customs on operational concerns arising from the implementation.

Comment: It was contended that requiring cargo manifest information to be submitted to Customs 24 hours before lading the cargo aboard the vessel at a foreign port would run counter to the “just in time” inventory practices in wide use today.

Customs Response: Customs is requiring transmissions of cargo declaration information 24 hours in advance. Customs is not requiring that the cargo be ready for inspection or that the cargo be at the dock. However, Customs recognizes that this final rule could cause vessel carriers to change the current practice of sometimes adding last minute loads to vessels, but only if such loads were not manifested 24 hours prior to their lading.

Nonetheless, as noted above, most cargo destined for the United States sits at the foreign port for several hours to several days before lading. This regulation will have no effect on that practice.

Comment: Numerous commenters requested generally that procedures required under the proposed rule be clarified. Many of these commenters addressed issues involving private contractual agreements between trade partners. Other matters where it was stated that further clarification was needed dealt with process and manifesting requirements of carriers, NVOCCs, involved ports, transshipment, and feeder vessels.

Customs Response: To the extent that trade partners may enter into private contractual agreements, Customs would have no involvement. Required information will include the data elements mentioned in the rulemaking along with the information that is required on the cargo declaration (CF 1302). These requirements apply at all foreign ports where an inward foreign vessel carrier lades cargo destined to the U.S., including FROB (Foreign Cargo Remaining On Board) which is not going to be unladen in the United States. The term “inward foreign carrier” applies to all vessels coming from foreign locations to the U.S. A vessel that transships cargo between foreign locations or a vessel that does not call on a U.S. port is not required to submit manifest information under this rulemaking.

The inward foreign vessel carrier that calls on many foreign ports before the U.S. will not have to re-transmit cargo declaration information already provided from previous foreign ports. Multiple original manifest transmissions can be submitted for the same carrier, vessel or voyage so long as AMS vessel arrival has not occurred. Carriers will only be required to transmit new cargo declaration information for each port of lading. Any NVOCCs and slot charterers, who are authorized to transmit manifest data in vessel AMS, will be subject to the same requirements as the vessel carrier to provide manifest information on cargo destined to the U.S., including FROB, as defined later in this document, at each foreign port of lading.

Comment: Several commenters asked about the time frame that would be given to implement the proposed rulemaking. There were two suggested time frames for implementing the advance manifest regulations that were mentioned repetitively by the commenters: one requested a lead time of six months, and the other requested one year to implement a phased-in approach.

Customs Response: This rulemaking responds to an urgent national security issue and must be implemented promptly. Customs must begin receiving advanced cargo declaration information to strengthen CSI and to reduce the risk of smuggling weapons of mass destruction and other contraband into the United States. As previously mentioned, however, in recognition of industry concerns, Customs has determined to delay full enforcement for a period of 60 days following the effective date of the new requirements. This, when taken together with the 30-day post publication period generally provided, will allow a total of 90 days from publication date to full enforcement.

Comment: A number of the commenters were concerned that they would lose business to Canadian ports due to the new regulations. They feared that cargo would initially go to Canada and then come to the U.S. via truck/rail to circumvent the regulations.

Customs Response: Customs has targeting personnel stationed at seaports in Canada and cooperation with Canadian authorities has been excellent. If either Customs administration suspected that goods were being routed in an attempt to evade scrutiny, those goods would be likely to be treated as high risk.

Comment: Several commenters questioned whether the new regulations would apply to FROB cargo (Foreign Cargo Remaining On Board). They also stated that carriers could refuse U.S. bound cargo once faced with the new requirements.

Customs Response: The definition of “FROB” cargo is cargo that is loaded in a foreign port and which is to be unloaded in another foreign port with an intervening vessel stop in one or more ports in the United States. Customs considers “FROB” cargo a security concern because although the cargo does not have a final destination in the U.S., the cargo is transiting the U.S. Currently, carriers must correctly report FROB cargo upon arrival in the United States. Under the new regulations, FROB cargo must be reported 24 hours in advance of loading.

Comment: Several commenters that were participants in C-TPAT (the Customs-Trade Partnership Against Terrorism) requested that they either be exempted from the advance manifest regulations or that they be allowed to present cargo manifest information at some point before the vessel arrived in the United States, rather than before the vessel departed from the foreign country. It was further requested that there be maintained a “known shipper list” which could enable Customs to expedite cargo clearance. These commenters also sought the ability to make changes to manifest information without time constraints being imposed.

Customs Response: While C-TPAT participants will not be excluded from the advance reporting requirements, their participation will be taken into account during the targeting process.

Comment: A number of commenters, specifically Port Authorities, were concerned that if permits to unlade were denied the result could be congestion at U.S. ports.

Customs Response: Permits may be granted to unlade properly manifested merchandise on a vessel but denied for the remainder of the cargo for which manifest information has not been accurately and/or timely received by Customs. Thus, depending on the circumstances, only that portion of the cargo for which advance information is not provided may not be unladen. Moreover, if the advance information is not timely provided, the subject cargo should not be laden on the vessel. Therefore, there is no reason to conclude that this final rule will cause congestion at U.S. ports.

Comment: Several commenters stated that the ability to submit their manifest at time of foreign departure or later would be more feasible.

Customs Response: The purpose of this rulemaking is to allow sufficient time for U.S. Customs to review and target cargo that may pose a threat to the U.S., specifically weapons of mass destruction, including nuclear and radiological materials and weapons, and to deny that cargo from being loaded on board vessels before they depart for the U.S. Having to interdict such cargo once it reaches our shores would simply be too late. Customs believes that the 24 hour period specified in the advance cargo declaration regulations is essential to achieving this goal.

Comment: Some commenters suggested that Customs conduct a risk analysis before implementing the 24 hour rule.

Customs Response: As noted above, Customs has analyzed the risks that international terrorists pose to the United States and the global trading system. These risks are profound. This analysis led to the development of CSI and the promulgation of this 24 hour advance cargo declaration rule.

Comment: Several commenters indicated that 24 hours was too much time to ask for information in advance for voyages that were less than 24 hours in length.

Customs Response: Customs will not exempt short hauls from the regulation. Cargoes placed aboard vessels on short voyages pose the same potential risks as those laded aboard vessels on longer voyages. Customs recognizes that compliance with the regulations may require certain changes in business practices, as previously discussed, but these changes are necessary to protect the United States and global shipping.

Comment: Several commenters asked whether the advance manifest regulations required that empty containers be manifested and whether, if so, information would have to be submitted to Customs 24 hours in advance. Additionally, it was stated in this connection that empty containers were used to complete stowage plans and were loaded at the last minute, depending on available space. It was stated that carriers would be faced with additional costs for the storage of empty containers if they did not make the voyage.

Customs Response: Carriers will not be required to submit information on empty containers 24 hours in advance of lading. For vessel AMS participants, information on empty containers must be submitted on a single bill of lading which lists all container numbers. For those carriers that present paper cargo declarations, empty containers must be listed on a single paper bill of lading with all container numbers listed. Submission of the empty container manifest information, whether paper or automated, will be due to U.S. Customs at least 24 hours prior to arrival in the United States, with the exception of those participants in the current vessel paperless manifest test, who must continue to file manifest information for empty containers 48 hours prior to arrival in the United States.

Comment: Several commenters raised the question of whether they would be permitted to update information which was provided to Customs prior to lading while they were enroute to the United States.

Customs Response: The main goals of the advance cargo declaration information program are (1) to receive accurate information (2) prior to lading in a foreign port. Only in this way can Customs use all of its targeting tools to identify potentially high risk shipments and prevent them from being placed aboard vessels in the first place. Accurate information is essential if Customs is going to be successful in preventing terrorists from using sea carriers to transport instruments of terrorism to the United States. We recognize, however, that updated or different information may be provided to carriers after lading. As this information would assist in our efforts to assess the risks associated with those shipments, we would expect to be provided with such information, and will ensure that there are mechanisms to do so. It must be understood, however, that an acceptance of certain changes in information after foreign lading will not justify any initial submission which is not, to the best information and belief of the filer, true and complete at the time of submission. Indeed, Customs will not tolerate such practices.

Customs recognizes that to accommodate manifest updates and changes, amendments will be necessary to our regulations governing the filing of Manifest Discrepancy Reports. Such changes will be the subject of a separate Federal Register publication as soon as possible.

Comment: Several commenters inquired about manifest discrepancy reports. It was asked whether carriers would be able to rely on the shippers' declaration regarding the contents of sealed containers. In addition, confirmation was requested that carriers would not be subject to penalties for incorrect manifest information provided by shippers.

Customs Response: As indicated in the prior response, Customs will be providing new rules for manifest discrepancy reports. A Notice of Proposed Rulemaking covering that matter will be published in the Federal Register. Until such time, carriers must continue to follow the current regulations concerning manifest discrepancy reports. This includes the guidelines for carriers using the shipper's declaration on sealed containers. Customs will not allow the manifest discrepancy report to be utilized in lieu of the provision of accurate and complete manifest information under the 24 hour rule.

Comment: Three commenters contended that the proposed advance manifest regulations would have a significant economic impact on a substantial number of small businesses, specifically non-vessel operating common carriers (NVOCCs), under the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. ), and thus should be subject to the preparation of a regulatory flexibility analysis as provided under the RFA. Two of these commenters also asserted in this context that the proposed rule constituted a “significant regulatory action” under E.O. 12866.

Customs Response: Customs is requiring advance manifest information in order to improve security at our nation's seaports and to more effectively enforce against all types of smuggling through our nation's borders. The information that Customs is collecting pursuant to this rulemaking is a necessary part of accomplishing these goals. Because the information being requested is information to which the master of the vessel should already have access, there is no indication that providing the additional information on the Customs Form (CF) 1302 to Customs 24 hours in advance of lading at the foreign port would result in a significant economic impact on a substantial number of small businesses.

Moreover, Customs has given the option to any small businesses involved in providing this information of providing the advance manifest information in paper form, rather than electronically, for those businesses that are not yet automated. Likewise, for those businesses that are automated, the advanced electronic filing would ultimately reduce filing costs because of the ability to submit the information electronically directly to Customs. Further, Customs has allowed for a delay of implementation of the new regulations in order to allow time for businesses to adjust to the new filing requirements.

Finally, none of the commenters has submitted evidence to Customs demonstrating the way in which these regulations would have a significant economic impact on small businesses. As such, Customs stands by its initial certification that a regulatory flexibility analysis pursuant to the Regulatory Flexibility Act is not applicable here.

Additionally, whether the Regulatory Flexibility Act applies to certain entities in a rulemaking turns on whether such entities are the “targets” of the rulemaking. To this end, the advance cargo manifest regulations that are the subject of this rulemaking are based upon 19 U.S.C. 1431. In pertinent part, 19 U.S.C. 1431(b) requires the master of a vessel (that is, the vessel carrier) to provide vessel cargo manifest information to Customs. It is thus the vessel carriers themselves to which these regulations are directed, and carriers are ultimately responsible under these regulations for providing mandatory cargo manifest information to Customs.

There is no requirement that NVOCCs participate in these advance manifest regulations; rather, Customs is merely affording NVOCCs the option under these regulations to provide cargo manifest data directly to Customs on behalf of the vessel carrier in order to protect what the NVOCC believes to be confidential business information. If NVOCCs do not wish to participate in the filing of advance cargo manifest information with Customs, the NVOCCs may properly elect to provide such information to the vessel carriers directly, for it is the vessel carriers, as emphasized above, that are obligated under these regulations to furnish this information to Customs. At most, therefore, the NVOCCs referenced in this rule are only indirectly affected by the subject regulations due to the nature of their business relationship with the vessel carriers.

In sum, no specific evidence was submitted by commenters establishing that there are a substantial number of small entities that are “targets” of the rulemaking.

Because Customs recognizes there will be costs involved in businesses changing their practices to comply with these national security-driven regulations, Customs will phase-in full implementation of this advance manifest rule over a period of 90 days. Specifically, these regulations will not be effective until 30 days after the date of publication of this final rule in the Federal Register . In addition, Customs will not initiate any enforcement actions such as assessing penalties for non-fraudulent violations of these regulations until 60 days after the effective date of this final rule. This phased-in implementation regime should reduce and minimize costs involved in complying with the new regulations.

Accordingly, the certification set forth in the proposed rule relating to the inapplicability of the Regulatory Flexibility Act in this case is revised in this final rule to reflect the foregoing considerations.

Also, we do not believe that this national security-related rule constitutes a “significant regulatory action” under E.O. 12866.

Comment: Several commenters stated that the accuracy of the agency's estimate of the information collection burden published in the proposed rule was vastly understated. It was stated that the numbers did not take into consideration the added time and paperwork, even in an automated environment, that will be required by the need for earlier information as supply chain documentation requirements will need to be overhauled.

Customs Response: Customs agrees with the commenters that the estimate of the information collection burden published in the notice of proposed rulemaking is understated and, accordingly, is upwardly adjusting the estimate of the burden.

Customs notes that the adjustment it is making to the estimated burden hours is not entirely due to the requirement to provide manifest information 24 hours prior to lading. Based upon the comments, Customs reviewed the previously approved information collection burden for preparing the vessel manifest and concluded that those numbers needed an upward adjustment. Accordingly, the upward adjustment stated in this document reflects both an adjustment due to this rule and an adjustment to the numbers that existed for the previous long-standing manifesting requirement.

Regarding any increase in burden due to overhaul of supply chain documentation requirements, Customs agrees that the number of hours spent collecting information may initially be high while business practices are adjusting. Eventually, however, Customs expects that the burden will decrease as the supply chain gets used to the new way of doing business.

In view of the foregoing, and following careful consideration of the comments received and further review of the matter, Customs has concluded that the proposed regulations with the modifications discussed above should be adopted as a final rule.

As stated in Customs response above, Customs is requiring advance manifest information in order to improve security at our nation's seaports and to more effectively enforce against all types of smuggling through our nation's borders. The information that Customs is collecting pursuant to this rulemaking is a necessary part of accomplishing these goals. Because the information being requested is information to which the master of the vessel should already have access, there is no indication that providing the additional information on the Customs Form (CF) 1302 to Customs 24 hours in advance of lading at the foreign port would result in a significant economic impact on a substantial number of small businesses.

Moreover, Customs has given the option to any small businesses involved in providing this information of providing the advance manifest information in paper form, rather than electronically, for those businesses that are not yet automated. Likewise, for those businesses that are automated, the advanced electronic filing would ultimately reduce filing costs because of the ability to submit the information electronically directly to Customs. Further, Customs has allowed for a delay of implementation of the new regulations in order to allow time for businesses to adjust to the new filing requirements.

Finally, none of the commenters has submitted evidence to Customs demonstrating the way in which these regulations would have a significant economic impact on small businesses. As such, Customs stands by its initial certification that a regulatory flexibility analysis pursuant to the Regulatory Flexibility Act is not applicable here.

The advance presentation to Customs of vessel manifest information for cargo destined for the United States as prescribed in this final rule is intended to expedite the release of incoming cargo while, at the same time, ensuring maritime safety and protecting national security. To this end, it is the vessel carriers themselves, which are mostly very large concerns, to which these regulations are targeted and that are ultimately responsible under these regulations for providing mandatory cargo manifest information to Customs.

By contrast, regarding non-vessel operating common carriers (NVOCCs), many of which are asserted to be small businesses, there is no requirement whatever that these entities participate in these advance manifest regulations; rather, Customs is merely affording NVOCCs the option under these regulations of providing cargo manifest data directly to Customs on behalf of the vessel carrier in order to protect what the NVOCC believes to be confidential business information. At best, therefore, the NVOCCs referenced in this rule are only indirectly affected by the subject regulations due to the nature of their business relationship with the vessel carriers. Hence, if NVOCCs do not wish to participate in the filing of advance cargo manifest information with Customs, the NVOCCs may properly elect to provide such information to the vessel carriers directly, for it is the vessel carriers, as emphasized above, that are obligated under these regulations to furnish this information to Customs.

Given the above reasons, pursuant to the provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ), it is certified that these final regulations do not have a significant economic impact on a substantial number of small entities. Accordingly, these amendments are not subject to the regulatory analysis or other requirements of 5 U.S.C. 603 and 604. Nor do they meet the criteria for a “significant regulatory action” as specified in E.O. 12866.

The collection of information in this final rule document was submitted for review and has been approved by the Office of Management and Budget (OMB) in accordance with the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)) under control number 1515-0001 (Transportation Manifest (Cargo Declaration)). An agency may not conduct, and a person is not required to respond to, a collection of information unless the collection of information displays a valid control number assigned by OMB.

The collection of information in this final rule document is contained in § 4.7a(c)(4). This information is required and will be used to deter smuggling by determining the security conditions under which cargo was maintained prior to and following its delivery for lading aboard a vessel for shipment to the United States. The likely respondents and/or recordkeepers are business or other for-profit institutions. The estimated average annual burden associated with this information collection is 49.8 hours per respondent or recordkeeper.

Comments on the accuracy of this burden estimate and suggestions for reducing this burden should be sent to the Office of Management and Budget, Attention: Desk Officer of the Department of the Treasury, Office of Information and Regulatory Affairs, Washington, DC 20503. A copy should also be sent to the Regulations Branch, Office of Regulations and Rulings, U.S. Customs Service, 1300 Pennsylvania Avenue, NW., Washington, DC 20229.

Part 178, Customs Regulations (19 CFR part 178), containing the list of approved information collections, is revised to reflect this additional information collection.

A final rule document published as T.D. 02-56 in the Federal Register (67 FR 61259) on September 30, 2002, extended for a period of five years import restrictions that were already in place for certain archaeological material from Guatemala. The final rule amended § 12.104g(a) of the Customs Regulations (19 CFR 12.104g(a)).

In the “Summary” and “Background” sections of the final rule, references to the country “Mali” erroneously appeared. This document corrects those references to read “Guatemala.”

In rule FR Doc. 02-24895, published on September 30, 2002, make the following corrections:

1. On page 61259, in the second column, in the “Summary” section, remove the word “Mali” in the fourth sentence and add in its place the word “Guatemala.”

2. On page 61259, in the third column, in the “Background” section, third paragraph, second sentence, remove the word “Mali” and add in its place the word “Guatemala.”

We did not publish a notice of proposed rulemaking (NPRM) for this regulation. Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a NPRM. Final approval and permitting of this event were not issued in time to engage in full notice and comment rulemaking. Publishing a NPRM and delaying the effective date would be contrary to the public interest since the event would occur before the rulemaking process was complete.

Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register . In addition to the reasons stated above, it would be contrary to the public interest not to publish this rule because the event has been permitted and participants and the public require protection.

The San Diego Rowing Club is sponsoring the San Diego Fall Classic, which is held in Mission Bay, San Diego, CA. This temporary safety zone is necessary to provide for the safety of the crews, spectators, and participants of the San Diego Fall Classic and is also necessary to protect other vessels and users of the waterway.

This event begins at the south end of Fiesta Island, proceeds north to Radar Island, south to Vacation Island, and proceeds north to El Carmel Point. The safety zone consists of the navigable waters extending 50 yards to either side of the course line, defined more specifically as follows: Starting at a point 32°46′00″ N, 117°13′00″ W, then northwest to 32°46′10″ N, 117°13′45″ W, then north to 32°47′00″ N, 117°13′30″ W, then south to 32°46′15″ N, 117°14′00″ W, then northwest to 32°46′48″ N, 117°14′40″ W. All coordinates are North American Datum 1983.

The Coast Guard proposes to establish one (1) safety zone that will be enforced from 6 a.m. (PST) to 12 p.m. (PST) on November 10, 2002. This safety zone is necessary to provide for the safety of the crews, spectators, and participants of the San Diego Fall Classic and to protect other vessels and users of the waterway. Persons and vessels will be prohibited from entering into, transiting through, or anchoring within this safety zone unless authorized by the Captain of the Port, or his designated representative.

This rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866, Regulatory Planning and Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. It is not “significant” under the regulatory policies and procedures of the Department of Transportation (DOT)(44 FR 11040, February 26, l979). We expect the economic impact of this rule to be so minimal that a full Regulatory Evaluation under paragraph 10(e) of the regulatory policies and procedures of DOT is unnecessary because of its limited duration of six (6) hours and the limited geographic scope of the safety zone.

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

The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities. This safety zone would not have a significant economic impact on a substantial number of small entities because this safety zone is limited in scope and duration (in effect for only six (6) hours on November 10, 2002). In addition the Coast Guard will publish local notice to mariners (LNM) before the safety zone is enforced.

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

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

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

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

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

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

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

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

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

We have considered the environmental impact of this rule and concluded that under figure 2-1, paragraph (34)(g), of Commandant Instruction M16475.lD, this rule is categorically excluded from further environmental documentation because we are proposing to establish a safety zone. A “Categorical Exclusion Determination” is available in the docket for inspection or copying where indicated under ADDRESSES.

We did not publish a notice of proposed rulemaking (NPRM) for this regulation. Under 5 U.S.C. 553(b)(B) and 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for not publishing an NPRM and for making this rule effective less than 30 days after publication in the Federal Register . Publishing a NPRM would be contrary to public interest since immediate action is necessary to safeguard tank ships from sabotage, other subversive acts, or accidents. If normal notice and comment procedures were followed, this rule would not become effective soon enough to provide immediate protection to tank ships from the threats posed by hostile entities and would compromise the vital national interest in protecting maritime transportation and commerce. The security zone in this regulation has been carefully designed to minimally impact the public while providing a reasonable level of protection for tank ships. For these reasons, following normal rulemaking procedures in this case would be impracticable, unnecessary, and contrary to the public interest.

Recent events highlight the fact that there are hostile entities operating with the intent to harm U.S. National Security. The President has continued the national emergencies he declared following the September 11, 2001 terrorist attacks (67 FR 58317 (Sept. 13, 2002) (continuing national emergency with respect to terrorist attacks), 67 FR 59447 (Sept. 20, 2002) (continuing national emergency with respect to persons who commit, threaten to commit or support terrorism)). The President also has found pursuant to law, including the Magnuson Act (50 U.S.C. 191 et seq. ), that the security of the United States is and continues to be endangered following the attacks (E.O. 13,273, 67 FR 56215 (Sept. 3, 2002) (security endangered by disturbances in international relations of U.S and such disturbances continue to endanger such relations).

The Coast Guard, through this action, intends to assist tank ships by establishing a security zone to exclude persons and vessels from the immediate vicinity of all tank ships. Entry into this zone will be prohibited unless authorized by the Captain of the Port or his designee. The Captain of the Port may be assisted by other federal, state, or local agencies.

This rule, for safety and security concerns, controls vessel movement in a regulated area surrounding tank ships. For the purpose of this regulation, a tank ship means a self-propelled tank vessel constructed or adapted primarily to carry oil or hazardous material in bulk as cargo or cargo residue in the cargo spaces. The definition of tank ship does not include tank barges. All vessels within 500 yards of tank ship shall operate at the minimum speed necessary to maintain a safe course, and shall proceed as directed by the official patrol. No vessel, except a public vessel (defined below), is allowed within 100 yards of a tank ship, unless authorized by the official patrol or tank ship master. Vessels requesting to pass within 100 yards of a tank ship shall contact the official patrol or tank ship master on VHF-FM channel 16 or 13. The official patrol or tank ship master may permit vessels that can only operate safely in a navigable channel to pass within 100 yards of a tank ship in order to ensure a safe passage in accordance with the Navigation Rules. Similarly, commercial vessels anchored in a designated anchorage area may be permitted to remain at anchor within 100 yards of passing tank ships. Public vessels for the purpose of this Temporary Final Rule are vessels owned, chartered, or operated by the United States, or by a State or political subdivision thereof.

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

We expect the economic impact of this proposed rule to be so minimal that a full Regulatory Evaluation under paragraph 10e of the regulatory policies and procedures of DOT is unnecessary.

Although this regulation restricts access to the regulated area, the affect of this regulation will not be significant because: (i) Individual tank ship security zones are limited in size; (ii) the official patrol or tank ship master may authorize access to the tank ship security zone; (iii) the tank ship security zone for any given transiting tank ship will affect a given geographical location for a limited time; and (iv) the Coast Guard will make notifications via maritime advisories so mariners can adjust their plans accordingly.

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

The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

This rule may affect the following entities, some of which may be small entities: the owners or operators of vessels intending to operate near or anchor in the vicinity of tank ships in the navigable waters of the United States.

This temporary regulation will not have a significant economic impact on a substantial number of small entities for the following reasons: (i) Individual tank ship security zones are limited in size; (ii) the official patrol or tank ship master may authorize access to the tank ship security zone; (iii) the tank ship security zone for any given transiting tank ship will affect a given geographic location for a limited time; and (iv) the Coast Guard will make notifications via maritime advisories so mariners can adjust their plans accordingly.

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

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

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

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

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

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

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

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

The Coast Guard recognizes the rights of Native American Tribes under the Stevens Treaties. Moreover, the Coast Guard is committed to working with Tribal Governments to implement local policies to mitigate tribal concerns. Given the flexibility of the Temporary Final Rule to accommodate the special needs of mariners in the vicinity of tank ships and the Coast Guard's commitment to working with the Tribes, we have determined that tank ship security and fishing rights protection need not be incompatible and therefore have determined that this Temporary Final Rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. Nevertheless, Indian Tribes that have questions concerning the provisions of this Temporary Final Rule or options for compliance are encouraged to contact the point of contact listed under FOR FURTHER INFORMATION CONTACT .

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

The Coast Guard's preliminary review indicates this temporary rule is categorically excluded from further environmental documentation under figure 2-1, paragraph 34(g) of Commandant Instruction M16475.lD. As an emergency action, the Environmental Analysis, requisite regulatory consultations, and Categorical Exclusion Determination will be prepared and submitted after establishment of this temporary tank ship security zone, and will be available in the docket. This temporary rule ensures the safety and security of tank ships. All standard environmental measures remain in effect. The Categorical Exclusion Determination will be made available in the docket for inspection or copying where indicated under ADDRESSES .

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:

Pursuant to the Resource Conservation and Recovery Act, 42 U.S.C. 6901 et seq. , states which have been authorized to administer the Federal hazardous waste program under RCRA section 3006(b), 42 U.S.C. 6926(b), have a continuing obligation to update their programs to meet revised Federal requirements. As the Federal program changes, States must change their programs and ask EPA to authorize the changes. Changes to State programs may be necessary when Federal or State statutory or regulatory authority is modified or when certain other changes occur. Most commonly, States must revise their programs because of changes to EPA's regulations in 40 Code of Federal Regulations (CFR) parts 124, 260 through 266, 268, 270, 273 and 279. For example, States must revise their programs to regulate the additional wastes determined to be hazardous as a result of using the Toxicity Characteristics Leaching Procedure (“TCLP”) test adopted by the EPA on March 29, 1990, in the TC Rule. 55 FR 11798. The EPA may grant final authorization to a State revision if it is equivalent to, consistent with, and no less stringent than Federal RCRA requirements.

In the alternative, as provided by RCRA section 3006(g), 42 U.S.C. 6926(g), for updated Federal requirements promulgated pursuant to the Hazardous and Solid Waste Amendments of 1984 (HSWA), such as the TC Rule, the EPA may grant interim ( i.e. , temporary) authorization to a State revision so long as it is substantially equivalent to Federal RCRA requirements.

The TC Rule grants authority over wastes which first became classified as hazardous as a result of using the “TCLP” test, such as many CRTs. See 55 FR 11798, 11847-11849 (March 29, 1990). CRTs are the glass picture tubes found inside television and computer monitors. Because of their high lead content, CRTs generally fail the TCLP test. Thus, under the EPA's current regulations, CRTs generally become hazardous wastes when they are discarded ( e.g. , when sent for disposal or reclamation rather than being reused). However, the EPA has recognized that certain widely generated wastes may pose lower risks during accumulation and transport than other hazardous wastes. Thus the EPA has listed certain wastes as Universal Wastes which are subject to reduced regulation and has allowed authorized States to add other appropriate wastes as Universal Wastes. See 40 CFR part 273.

On August 4, 2000, Massachusetts adopted regulations which revised its regulatory program as it relates to CRTs. The State adopted a three-part approach: (1) Intact CRTs being disposed are subject to full hazardous waste requirements (along with crushed or ground up CRTs); (2) intact CRTs that may still be reused (without reclamation) generally are considered commodities exempt from hazardous waste requirements; and, finally, (3) intact CRTs which will not be reused, but which instead will be crushed and recycled ( i.e. , as spent materials being reclaimed), are subject to reduced requirements which track some but not all of the EPA's Universal Waste Rule requirements. As explained in the Federal Register on November 15, 2000, 65 FR 68915, and further explained in a legal memorandum contained in the Administrative Record, dated January 21, 2000 entitled “Massachusetts' Regulation of CRTs,” the EPA determined that the State program was “substantially equivalent” to Federal RCRA requirements. Therefore, the EPA granted Massachusetts interim authorization to regulate CRTs under the TC Rule. The State program was determined to be only “substantially” rather than fully equivalent to the federal RCRA program because the maximum flexibility allowed under the federal program was to regulate hazardous CRTs being reclaimed as a Universal Waste, whereas Massachusetts regulates intact CRTs heading to reclamation less stringently in certain respects than does the Universal Waste Rule.

There have been no changes in either the Federal or Massachusetts regulations applicable to CRTs since November 15, 2000. Therefore, the State program remains substantially equivalent (but not fully equivalent) to current Federal RCRA requirements, for the reasons previously stated. However, in line with the general deadline for the expiration of interim authorizations set in 40 CFR 271.24, the interim authorization of the Massachusetts CRT program is set to expire on January 1, 2003. Absent further EPA action, the authority to regulate the CRTs would revert to the EPA as of January 1, 2003, and full hazardous waste regulations would become applicable to many CRTs in Massachusetts.

Like Massachusetts, the EPA has recognized that regulating intact CRTs as a fully regulated hazardous waste can discourage recycling of the CRTs and, thus, be counter-productive. Therefore, it is environmentally important not to allow the interim authorization of the Massachusetts regulations to expire.

On June 12, 2002, the EPA proposed to adopt regulations to reduce RCRA regulatory requirements for CRTs. See 67 FR 40508. If the proposed rule is adopted, intact CRTs heading for reclamation will no longer be classified as solid or hazardous wastes. Thus, they will no longer need to be handled in accordance with either full hazardous waste or Universal Waste Rule requirements. Therefore, if and when the proposed rule is adopted, the Massachusetts CRT program will no longer be less stringent than the Federal program. It will be equivalent to the Federal program in exempting commodity CRTs from regulations while fully regulating CRTs being disposed, and will be more stringent than the Federal program in partially regulating intact CRTs being reclaimed and in fully regulating crushed or ground up CRTs even when they are recycled. However, the final EPA CRT rule is not expected to be issued until after January 1, 2003.

The EPA believes that extension of the interim authorization of the Massachusetts CRT program beyond the generally applicable deadline of January 1, 2003 is appropriate in the unusual circumstances presented. An extension to January 1, 2006 will enable the Massachusetts program to continue to operate pending the EPA's final decision on its own CRT Rule. This should give the EPA sufficient time to finalize its own CRT Rule. If the final EPA CRT Rule is the same as the proposed rule or otherwise remains at least as flexible as the Massachusetts CRT Rule, then the EPA should be able to later grant final authorization to the Massachusetts CRT Rule, as soon as the EPA CRT Rule is adopted. If the final EPA CRT Rule is more stringent than the Massachusetts CRT Rule, the EPA and State can address the resulting situation at that time. If the final EPA CRT Rule has not been issued by January 1, 2006, the EPA may consider a further extension of the interim authorization of the Massachusetts CRT Rule, but is making no decision on such a further extension at this time.

The effect of this decision is that for CRTs regulated under the TC Rule, a facility in Massachusetts subject to RCRA will have to continue to comply with the authorized State requirements instead of the Federal requirements in order to comply with RCRA. The Commonwealth of Massachusetts has enforcement responsibilities under its State hazardous and solid waste programs for violations of such programs, but EPA also retains its full authority under RCRA sections 3007, 3008, 3013, and 7003.

This action does not impose additional requirements on the regulated community because the State regulations for which interim authorization to Massachusetts is being extended by today's action are already in effect under State law, and are not changed by today's action.

EPA did not publish a proposal before today's rule because we view this as a routine program change and do not expect comments that oppose this approval. We are providing an opportunity for public comment now. In addition to this rule, in the proposed rules section of today's Federal Register we are publishing a separate document that proposes to authorize the State program changes.

If EPA receives comments that oppose this authorization, we will withdraw this rule by publishing a document in the Federal Register before the rule becomes effective. EPA will base any further decision on the authorization of the State program changes on the proposal mentioned in the previous paragraph. We will then address all public comments in a later final rule. You may not have another opportunity to comment. If you want to comment on this authorization, you must do so at this time.

Massachusetts initially received Final Authorization on January 24, 1985, effective February 7, 1985 (50 FR 3344) to implement its base hazardous waste management program. EPA granted authorization for changes to their program on September 30, 1998, effective November 30, 1998 (63 FR 52180) and October 12, 1999, effective that date (64 FR 55153), in addition to the previously discussed November 15, 2000 authorization of the Massachusetts CRT Rule (65 FR 68915).

The Massachusetts regulations authorized by today's action are the same as those listed in the chart set forth in the Federal Register document dated November 15, 2000 (65 FR 68915, 68918). Today's action simply extends the interim authorization previously granted from January 1, 2003 to January 1, 2006.

The differences between the State and Federal regulations with respect to CRTs are discussed in the November 15, 2000 Federal Register document. Notwithstanding these differences, the EPA believes that the State regulations are substantially equivalent to the Federal regulations and, thus, the State continues to qualify to have interim authorization. During the interim authorization period, for CRTs regulated under the TC Rule, these State regulations will operate in lieu of the Federal hazardous waste regulations.

Massachusetts will issue permits for all the provisions for which it is authorized and will administer the permits it issues. EPA will continue to administer any RCRA hazardous waste permits or portions of permits which we issued prior to the effective date of this authorization. EPA will continue to implement and issue permits for HSWA requirements for which Massachusetts is not yet authorized.

Massachusetts is not authorized to carry out its hazardous waste program in Indian country within the State. Therefore, this action has no effect on Indian country. EPA will continue to implement and administer the RCRA program in these lands.

Codification is the process of placing the State's statutes and regulations that comprise the State's authorized hazardous waste program into the Code of Federal Regulations. We do this by referencing the authorized State rules in 40 CFR part 272. We are today authorizing, but not codifying the enumerated revisions to the Massachusetts program. We reserve the amendment of 40 CFR part 272, subpart W for the codification of Massachusetts' program until a later date.

The Office of Management and Budget has exempted this action from the requirements of Executive Order 12866 (58 FR 51735, October 4, 1993) and, therefore, this action is not subject to review by OMB. This action authorizes State requirements for the purpose of RCRA 3006 and imposes no additional requirements beyond those imposed by State law. Accordingly, I certify that this action will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ). Because this action authorizes pre-existing requirements under State law and does not impose any additional enforceable duty beyond that required by State law, it does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Public Law 104-4). For the same reason, this action also does not significantly or uniquely affect the communities of tribal governments, as specified by Executive Order 13084 (63 FR 27655, May 10, 1998). This action will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999), because it merely authorizes State requirements as part of the State RCRA hazardous waste program without altering the relationship or the distribution of power and responsibilities established by RCRA. This action also is not subject to Executive Order 13045 (62 FR 19885, April 23, 1997), because it is not economically significant and it does not make decisions based on environmental health or safety risks.

Under RCRA section 3006(b), EPA grants a State's application for authorization as long as the State meets the criteria required by RCRA. It would thus be inconsistent with applicable law for EPA, when it reviews a State authorization application, to require the use of any particular voluntary consensus standard in place of another standard that otherwise satisfies the requirements of RCRA. Thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. As required by section 3 of Executive Order 12988 (61 FR 4729, February 7, 1996), in issuing this rule, EPA has taken the necessary steps to eliminate drafting errors and ambiguity, minimize potential litigation, and provide a clear legal standard for affected conduct. EPA has complied with Executive Order 12630 (53 FR 8859, March 15, 1988) by examining the takings implications of the rule in accordance with the “Attorney General's Supplemental Guidelines for the Evaluation of Risk and Avoidance of Unanticipated Takings” issued under the executive order. This rule does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ).

The Congressional Review Act, 5 U.S.C. 801 et seq. , as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this document and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication in the Federal Register . A major rule cannot take effect until 60 days after it is published in the Federal Register . This action is not a “major rule” as defined by 5 U.S.C. 804(2). This action, nevertheless, will be effective 60 (sixty) days after publication pursuant to the procedures governing immediate final rules.

This is a synopsis of the Commission's Memorandum Opinion and Order in MM Docket No. 00-31, adopted October 9, 2002, and released October 18, 2002. The full text of this decision is available for inspection and copying during normal business hours in the FCC's Reference Information Center at Portals II, CY-A257, 445 12th Street, SW., Washington, DC 20554. The complete text of this decision may also be purchased from the Commission's copy contractor, Qualex International Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554, telephone 202-863-2893, facsimile 202-863-2898, or via e-mail qualexint@aol.com.

This is a synopsis of the Commission's Report and Order, MB Docket Nos. 02-209, 02-210, 02-211, adopted October 9, 2002, and released October 18, 2002. The full text of this Commission decision is available for inspection and copying during regular business hours at the FCC's Reference Information Center, Portals II, 445 Twelfth Street, SW., Room CY-A257, Washington, DC 20554. The complete text of this decision may also be purchased from the Commission's duplicating contractor, Qualex International, Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC, 20554, telephone 202-863-2893, facsimile 202-863-2898, or via e-mail qualexint@aol.com.

The Audio Division, at the request of Grant County Broadcasters, allots Channel 250C1 at Hyannis, Nebraska, as the community's first local FM transmission service. See 67 FR 52924, August 14, 2002. Channel 250C1 can be allotted to Hyannis in compliance with the Commission's minimum distance separation requirements at city reference coordinates. The coordinates for Channel 250C1 at Hyannis are 42-00-02 North Latitude and 101-45-41 West Longitude.

The Audio Division, at the request of Wall Radio Broadcasters, allots Channel 288C at Wall, South Dakota, as the community's first local FM transmission service. See 67 FR 52924, August 14, 2002. Channel 288C can be allotted to Wall in compliance with the Commission's minimum distance separation requirements at city reference coordinates. The coordinates for Channel 288C at Wall are 43-59-47 North Latitude and 102-13-07 West Longitude.

Provisions of the Regulatory Flexibility Act of l980 do not apply to this proceeding. Members of the public should note that from the time a Notice of Proposed Rule Making is issued until the matter is no longer subject to Commission consideration or court review, all ex parte contacts are prohibited in Commission proceedings, such as this one, which involve channel allotments. See 47 CFR 1.1204(b) for rules governing permissible ex parte contact.

For information regarding proper filing procedures for comments, see 47 CFR 1.415 and 1.420.

This is a synopsis of the Commission's Report and Order in MM Docket Nos. 01-123 and 01-177, adopted October 9, 2002, and released October 18, 2002. The full text of this Commission decision is available for inspection and copying during normal business hours in the FCC's Reference Information Center at Portals II, CY-A257, 445 12th Street, SW, Washington, DC. This document may also be purchased from the Commission's duplicating contractors, Qualex International, Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC, 20554, telephone 202-863-2893, facsimile 202-863-2898, or via e-mail qualexint@aol.com.

Information on the regulation of contractor performance evaluations is organized as follows:

This final rule amends the Environmental Protection Agency Acquisition Regulation Subpart 1509.170 and 1552.209-76 to allow EPA contracting officers to utilize the construction module in the National Institutes of Health's Contractor Performance System. EPA currently uses the services module in the NIH system to evaluate contractor performances of both large and small businesses who are awarded EPA contracts in excess of $100,000.

A proposed rule was published in the Federal Register (67 FR 7657-7660) on February 20, 2002, providing for a 30 day comment period. There were no comments received regarding the proposed rule.

This final rule will allow EPA contracting officers to use either the services module or the construction module in the National Institutes of Health's Contractor Performance System, depending on the type of acquisition.

This final rule is not a significant regulatory action for the purposes of Executive Order 12866; therefore, no review is required by the Office of Information and Regulatory Affairs within the Office of Management and Budget (OMB).

The Paperwork Reduction Act applies to this final rule, and the information collection request has been evaluated by the Office of Management and Budget. The Office of Information and Regulatory Affairs within the Office of Management and Budget has issued OMB Clearance No. 9000-0142 for the collection of contractor performance information. Comments regarding Paperwork Reduction Act concerns should be sent to the Office of Management and Budget (Attn: EPA Desk Officer).

The RFA generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements under the Administrative Procedure Act or any other statute unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small organizations, and small governmental jurisdictions.

For purposes of assessing the impact of today's rule on small entities, small entity is defined as: (1) A small business that meets the definition of a small business found in the Small Business Act and codified at 13 CFR 121.201; (2) a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and (3) a small organization that is any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.

After considering the economic impacts of today's rule on small entities, I certify that this action will not have a significant economic impact on a substantial number of small entities. In determining whether a rule has a significant economic impact on a substantial number of small entities, the impact of concern is any significant adverse economic impact on small entities, since the primary purpose of the regulatory flexibility analyses is to identify and address regulatory alternatives “which minimize any significant economic impact of the proposed rule on small entities.” 5 U.S.C. 603 and 604. Thus, an agency may certify that a rule will not have a significant economic impact on a substantial number of small entities if the rule relieves regulatory burden, or otherwise has a positive economic effect on all of the small entities subject to the rule.

This final rule requires no reporting or record-keeping by small or large business contractors. Rather, it provides EPA contractors with a formal opportunity, generally once a year per contract, to review and comment on their specific performance evaluations as conducted by the cognizant EPA contracting officer. Therefore, this final rule will have no adverse or significant economic impact on small entities.

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104-4, establishes requirements for Federal agencies to assess their regulatory actions on State, local, and Tribal governments, and the private sector. This final rule does not contain a Federal mandate that may result in expenditures of $100 million or more for State, local, and Tribal governments, in the aggregate, or the private sector in one year. Any private sector costs for this action relate to paperwork requirements and associated expenditures that are far below the level established for UMRA applicability. Thus, this final rule is not subject to the requirements of sections 202 and 205 of the UMRA.

Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks (62 FR 19885, April 23, 1997), applies to any rule that: (1) Is determined to be economically significant as defined under Executive Order 12866, and (2) concerns an environmental health or safety risk that EPA has reason to believe may have a disproportionate effect on children. If the regulatory action meets both criteria, the Agency must evaluate the environmental health or safety effects of the planned rule on children, and explain why the planned regulation is preferable to other potentially effective and reasonably feasible alternatives considered by the Agency.

This final rule is not subject to Executive Order 13045 because it is not an economically significant rule as defined by Executive Order 12866, and because it does not involve decisions on environmental health or safety risks.

Executive Order 13132 entitled “Federalism” (64 FR 43255, August 10, 1999) requires EPA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” as defined in the Executive Order include regulations that have “substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.” Under Section 6 of Executive Order 13132, EPA may not issue a regulation that has federalism implications, that imposes substantial direct compliance costs, and that is not required by statute, unless the Federal government provides the funds necessary to pay the direct compliance costs incurred by State and local governments, or EPA consults with State and local officials early in the process of developing the proposed regulation. EPA also may not issue a regulation that has federalism implications and that preempts State law, unless the Agency consults with State and local officials early in the process of developing the proposed regulation.

This rule does not have federalism implications. It will not have substantial direct effects on the States, on the relationship between the national government and the States distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132. Thus, the requirements of section 6 of the Executive Order do not apply to this rule.

Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 6, 2000), requires EPA to develop an accountable process to ensure “meaningful and timely input by tribal officials in the development of regulatory policies that have tribal implications.” “Policies that have tribal implications” is defined in the Executive Order to include regulations that have “substantial direct effects on one or more Indian tribes, on the relationship between the Federal government and the Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes.”

This rule does not have tribal implications. It will not have substantial direct effects on tribal governments, on the relationship between the Federal government and Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes, as specified in Executive Order 13175. Thus, Executive Order 13175 does not apply to this rule.

EPA will use voluntary consensus standards, as directed by section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA), Public Law 104-113, section 12(d) (15 U.S.C. 272 note), in its procurement activities. The NTTAA directs EPA to use voluntary consensus standards in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards ( e.g. , materials specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies. The NTTAA directs EPA to provide Congress, through OMB, explanations when the Agency decides not to use available and applicable voluntary consensus standards.

This rulemaking does not involve technical standards. Therefore, EPA is not considering use of any voluntary consensus standards.

This final rule is not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355 (May 22, 2001)) because it is not a significant regulatory action under Executive Order 12866.

The Congressional Review Act, 5 U.S.C. 801 et seq. , as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rules report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register . A major rule cannot take effect until 60 days after it is published in the Federal Register . This action is not a “major rule” as defined by 5 U.S.C. 804(2).

The Sacramento splittail (hereafter splittail) represents the only extant species in its genus in North America. For a detailed description of the species, see the Recovery Plan for the Sacramento/San Joaquin Delta Native Fishes (Service 1996), references within that plan, and Moyle et al. (2001 in prep.).

Splittail are endemic to certain waterways in California's Central Valley, where they were once widely distributed (Moyle 1976, Moyle 2002). Splittail presently occur in Suisun Bay, Suisun Marsh, the San Francisco Bay-Sacramento-San Joaquin River Estuary (Estuary), the Estuary's tributaries (primarily the Sacramento and San Joaquin rivers), the Cosumnes River, the Napa River and Marsh, and the Petaluma River and Marsh. The splittail no longer occurs throughout a significant portion of its former range.

Pursuant to the Endangered Species Act of 1973, as amended (Act), the splittail was listed as a threatened species on February 8, 1999 (64 FR 5963). In this previous listing determination, we found that changes in water flows and water quality resulting from export of water from the Sacramento and San Joaquin rivers, periodic prolonged drought, loss of shallow water habitat, and the effects of agricultural and industrial pollutants were significant factors in the splittail's decline.

Subsequent to the publication of the final rule, plaintiffs in the cases San Luis & Delta-Mendota Water Authority v. Anne Badgley, et al. and State Water Contractors, et al. v. Michael Spear, et al. commenced action in Federal Eastern District Court of California, challenging the listing of the splittail as threatened, alleging various violations of the Act and of the Administrative Procedure Act (5 U.S.C 551 et seq. ). We, as directed by the court, and pursuant to the Act, provided notice of the opening of a comment period regarding the threatened status for the splittail, from January 12, 2001, to February 12, 2001 (66 FR 2828). In addition, we reopened the comment period on three additional occasions; from May 8, 2001, to June 7, 2001 (66 FR 23181); from August 17, 2001, to October 1, 2001 (66 FR 43145); and from March 21, 2002, to October 15, 2002 (67 FR 13095). The October 15, 2002, comment period closing date stated in 67 FR 13095 was corrected to May 20, 2002, via a correction document published on April 1, 2002 (67 FR 15337).

We are now reopening the comment period to solicit comments on the factors affecting the splittail (as first solicited in 66 FR 2828) and on the revised statistical analysis used to analyze the abundance data available for splittail, and to seek public comment on the status of the species (as solicited in 67 FR 13095). Upon the close of this comment period, we will make our determination whether the splittail warrants the continued protection of the Act.

The approach currently used by us to analyze the best scientifically and commercially available splittail abundance data differs from methods employed previously. In the February 8, 1999, final rule and the January 12, 2001, and May 8, 2001, reopenings of the comment periods, we relied primarily on the unstratified Mann-Whitney U-test approach utilized by Meng and Moyle (1995), first published in the Transactions of the American Fisheries Society . See 66 FR 2828 for a complete description of the Meng and Moyle (1995) method.

In the August 17, 2001, reopening of the comment period, we employed permutation-based exact calculations of p-values for stratified Mann-Whitney U-tests to analyze data derived from the Meng and Moyle (1995), Sommer et al. (1997), and California Department of Fish and Game (CDFG) methodologies. We also employed a polynomial regression model and a crude exponential decay analysis in the August 17, 2001, comment period. See 66 FR 2828 for a complete description of the permutation-based exact calculations of p-values for stratified Mann-Whitney U-tests method.

In the March 21, 2002, reopening, we employed a statistical analysis of an abundance index and Multiple Linear Regression (MLR) model jointly developed and submitted by the CDFG (Rempel 2001) and the United States Bureau of Reclamation (USBR) (Michny 2001). The model, hereafter referred to as the CDFG/USBR MLR model and described in detail in 67 FR 13095, was used to analyze data from: (1) CDFG's Fall Midwater Trawl (Fall MWT) survey; (2) CDFG's San Francisco Bay Midwater Trawl (Bay Study MW); (3) CDFG's San Francisco Bay Otter Trawl (Bay Study OT); (4) the University of California (UC) Davis Suisun Marsh Otter Trawl (Suisun Marsh OT); (5) our Chipps Island Trawl survey (Chipps Is. Trawl); (6) fish salvage operations (which repatriate fish taken from water intake screens) at the CVP Tracy Fish Collection Facility (CVP); and (7) fish salvage at the State Water Project (SWP) Skinner Delta Fish Protective Facility in the south Delta. See Moyle et al. 2001 in prep.; Meng and Moyle 1995; and Sommer et al. 1997, for descriptions of surveys.

The CDFG/USBR MLR model's four highest, statistically significant (at traditional levels) probabilities of a nonzero downward splittail population trend are exhibited by the Suisun Marsh survey (Age-0 and adult) and in the data collected via fish salvage operations at the SWP (Age-1, and Age-2 and greater). The decline evident in the Chipps Island Trawl (Age-2 and greater) is nearly-statistically significant at traditional levels (94.3 percent probability). Two additional probabilities of a nonzero downward splittail population trend are evident at the 80 percent probability level; Chipps Island Trawl (Age-1) and SWP salvage (Age-0). See 67 FR 13095 for a complete description of the CDFG/USBR MLR model and our statistical analysis of its results.

We believe that all of the abundance monitoring data for splittail have methodological weaknesses of one sort or another; none of the surveys were designed specifically to rigorously estimate splittail population numbers. However, we believe that these existing data sets constitute the best available scientific information for the species.

We will accept written comments during this reopened comment period, and comments should be submitted to the Sacramento Fish and Wildlife Office as found in the ADDRESSES section.

You may send comments by electronic mail (e-mail) to: fw1splittail@fws.gov. If you submit comments by e-mail, please submit them as an ASCII file and avoid the use of special characters and any form of encryption. Please also include “Attn: [RIN AH73]” and return address in your e-mail message. If you do not receive a confirmation from the system that we have received your e-mail message, contact us directly by calling our Sacramento Fish and Wildlife Office at telephone number 916/414-6600, during normal business hours.

The primary author of this notice is Jason Douglas ( see ADDRESSES section).

The authority for this action is the Endangered Species Act of 1973, as amended (16 U.S.C. 1531 et seq. ).