[Federal Register Volume 67, Number 225 (Thursday, November 21, 2002)]
[Rules and Regulations]
[Pages 70151-70153]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-29597]


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DEPARTMENT OF AGRICULTURE

Rural Utilities Service

7 CFR Parts 1710 and 1717

RIN 0572-AB68


Exceptions of RUS Operational Controls Under Section 306E of the 
RE Act

AGENCY: Rural Utilities Service, USDA.

ACTION: Final rule.

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[[Page 70152]]

SUMMARY: In an effort to streamline requirements of borrowers and make 
regulations simple and direct, the Rural Utilities Service (RUS) will 
eliminate regulations on Exceptions of RUS Operational Controls under 
Section 306E of the RE Act in its entirety. Because borrowers are now 
afforded the same exemptions of RUS operational controls by way of 
other provisions, RUS has determined that the regulation can now be 
removed from its regulations.

DATES: This rule will become effective on December 23, 2002.

FOR FURTHER INFORMATION CONTACT: Patrick R. Sarver, Management Analyst, 
Rural Utilities Service, Electric Program, Room 4024 South Building, 
Stop 1560, 1400 Independence Ave., SW., Washington, DC 20250-1560, 
Telephone: 202-690-2992, FAX: 202-690-0717, E-mail: 
[email protected].

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    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).

Executive Order 12372

    This rule is excluded from the scope of Executive Order 12372, 
Intergovernmental Consultation, which may require consultation with 
State and local officials. See the final rule related notice titled 
``Department Programs and Activities Excluded from Executive Order 
12372'' (50 FR 47034) advising that RUS loans and loan guarantees from 
coverage were not covered by Executive Order 12372.

Executive Order 12988

    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. RUS has determined that this rule meets the applicable 
standards provided in section 3 of the Executive Order. In addition, 
all state and local laws and regulations that are in conflict with this 
rule will be preempted; no retroactive effect will be given to this 
rule, and, in accordance with section 212(e) of the Department of 
Agriculture Reorganization Act of 1994 (7 U.S.C. 6912(e)), 
administrative appeals procedures, if any are required, must be 
exhausted before and action against the Department or its agencies.

Regulatory Flexibility Act Certification

    It has been determined that the Regulatory Flexibility Act is not 
applicable to this rule since the Rural Utilities Service is not 
required by 5 U.S.C. 551 et seq. or any other provision of law to 
publish a notice of proposed rulemaking with respect to the subject 
matter of this rule.

Information Collection and Recordkeeping Requirements

    This rule contains no additional information collection or 
recordkeeping requirements under OMB control number 0572-0032 that 
would require approval under the Paperwork Reduction Act of 1995 (44 
U.S.C. chapter 35).

Unfunded Mandates

    This rule contains no Federal mandates (under the regulatory 
provision of title II of the Unfunded Mandates Reform Act) for State, 
local, and tribal governments or the private sector. Thus, this rule is 
not subject to the requirements of sections 202 and 205 of the Unfunded 
Mandates Reform Act.

National Environmental Policy Act Certification

    The Administrator of RUS has determined that this rule will not 
significantly affect the quality of human environment as defined by the 
National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.). 
Therefore, this action does not require an environmental impact 
statement or assessment.

Catalog of Federal Domestic Assistance

    The program described by this rule is listed in the Catalog of 
Federal Domestic Assistance Programs under No. 10.850, Rural 
Electrification Loans and Loan Guarantees. This catalog is available on 
a subscription basis from the Superintendent of Documents, U.S. 
Government Printing Office, Washington, DC 20402-9325, telephone number 
(202) 512-1800.

Background

    On May 24, 2002, at 67 FR 101, RUS published a proposed rule, 7 CFR 
Part 1710 and 1717, Exceptions of RUS Operational Controls Under 
Section 306E of the RE Act, which proposed the elimination of 7 CFR 
1710.7. RUS currently treats the general subject of operational 
controls for recipients of electric loans and guarantees in three 
separate places, namely in RUS loan documents, in 7 CFR part 1717, 
subpart M, and in 7 CFR 1710.7. In the interest of eliminating 
confusion and to continue in its ongoing program to streamline RUS 
regulations, RUS will eliminate 7 CFR 1710.7.
    Written comments were received June 24, 2002, from Tex-LA Electric 
Cooperative of Texas, Inc., Northeast Texas Electric Cooperative, Inc, 
and Sam Rayburn G&T Electric Cooperative, Inc., on behalf of themselves 
and their respective member distribution cooperatives. The three 
cooperatives support the removal of 7 CFR 1710.7 and provided 
additional comments on regulations not covered in this rulemaking. 
Specifically the cooperatives ask that more precise reference be made 
throughout the regulations when the phrase ``other RUS regulations'' is 
used as reference. The three cooperatives also ask that RUS take the 
opportunity to correct a typographical error found in 7 CFR 1717.615 
(f)(2). RUS agrees with the comments made by the three cooperatives 
that whenever possible, precise reference to other sections of the 
regulations should be made instead of a more general statement and will 
continue to make rules with clear reference to other sections of its 
regulations as appropriate. RUS will also take this opportunity to 
correct the typographical error that was identified.
    In this rulemaking, as presented in the proposed rule, it appears 
that 7 CFR 1710.7 has become an anachronism because the subsequent 
promulgation of new loan documents and subpart M effectively conferred 
the benefits of 7 CFR 1710.7 to all borrowers. Borrowers who are 
relying on subpart M are encouraged to switch to the new forms of loan 
documents so that subpart M itself can eventually be removed at a later 
date once the universe of legacy borrowers has sufficiently contracted 
to the point that any remaining legacy borrowers could be dealt with 
either informally or on a case-by-case basis. RUS does not believe this 
action will diminish or abrogate any rights or privileges conferred 
upon 110 percent borrowers by section 306e of the RE Act, and no such 
consequences are intended.

List of Subjects

7 CFR Part 1710

    Electric power, Electric utilities, Loan programs--energy, 
Reporting and recordkeeping requirements, Rural areas.

7 CFR Part 1717

    Administrative practice and procedure, Electric power, Electric 
power rates, Electric utilities, Intergovernmental relations, 
Investments, Loan programs--energy, Reporting and recordkeeping 
requirements, Rural areas.

[[Page 70153]]


    For the reasons set forth in the preamble, chapter X of title 7 of 
the Code of Federal Regulations, RUS amends 7 CFR parts 1710 and 1717 
as follows:

PART 1710--GENERAL AND PRE-LOAN POLICIES AND PROCEDURES COMMON TO 
INSURED AND GUARANTEED ELECTRIC LOANS

    1. The authority citation for part 1710 continues to read as 
follows:

    Authority: 7 U.S.C. 901 et seq., 1921 et seq., 6941 et seq.

Subpart A--General


Sec.  1710.7  [Removed and Reserved]

    2. Section 1710.7 is removed and reserved.

PART 1717--POST-LOAN POLICIES AND PROCEDURES COMMON TO INSURED AND 
GUARANTEED ELECTRIC LOANS

    3. The authority citation for part 1717 continues to read as 
follows:

    Authority: 7 U.S.C. 901 et seq., 1921 et seq., 6941 et seq.

Subpart S--Lien Accommodations for Supplemental Financing Required 
by 7 CFR 1710.110

    4. Section 1717.615(f)(2) is revised to read as follows:


Sec.  1717.615  Consolidations and Mergers.

* * * * *
    (f) * * *
    (2) A pro forma TIER of not less than 1.25 and a pro forma DSC of 
not less than 1.25 for each of the two preceding calendar years;


Sec.  1717.904  [Amended]

    5. Section 1717.904 is amended by removing paragraphs (c) and (d) 
and redesignating paragraph (e) as paragraph (c).

    Dated: November 13, 2002.
Hilda Gay Legg,
Administrator, Rural Utilities Service.
[FR Doc. 02-29597 Filed 11-20-02; 8:45 am]
BILLING CODE 3410-15-P