On February 10, 2000, the FAA issued AD 2000-02-12, Amendment 39-11579, (65 FR 8032, February 17, 2000), Docket No. 99-SW-79-AD, to require inspecting each oil cooler blower bearing for roughness and replacing any rough bearing before further flight. That AD was prompted by reports of bearing failure. Subsequently, the FAA received additional reports of bearing failures that may have been caused by engine exhaust gas ingestion. Therefore, the FAA issued superseding Emergency AD 2002-06-52 on March 15, 2002, to require replacing certain bearings, adding a limitation and caution to the RFM, and at specified intervals inspecting, lubricating, and replacing the bearings. That Emergency AD was published as a Final Rule; Request for Comments on April 17, 2002 (67 FR 18815). That action was prompted by several cases of bearing failures. The requirements of that AD are intended to prevent oil cooler blower bearing failure, loss of tail rotor drive, and a subsequent forced landing.

Since issuing that AD, the FAA has received more reports of bearing failure. Since the initial reports of in-flight oil cooler bearing failures, we have received recent reports of in-flight bearing failures occurring on the segmented tail rotor drive shaft. In response to the failures, the manufacturer has introduced improvements to the oil cooler inlet airflow. Also, the manufacturer prescribes replacing bearings, part number (P/N) 406-040-339-ALL, 407-340-339-101 and 407-340-339-103, with improved bearings, P/N 407-340-339-107. BHTC has revised its Alert Service Bulletins for the Model 407 helicopters as follows:

• Alert Service Bulletin (ASB) 407-02-54, Revision A, dated October 10, 2002, specifies installing the oil cooler blower inlet ducts and airflow shields for helicopters, serial number (S/N) 53000 through 53518 (excluding S/N 53108). Performing the specifications of this ASB is considered terminating action to ASB 407-02-49, Revision A, dated March 12, 2002.

• ASB 407-04-63, Revision A, dated March 3, 2004, specifies replacing bearings, P/N 407-340-339-101 and 407-340-339-103, with bearings, 407-340-339-107, and inspecting and lubricating the bearings. This ASB supersedes ASB 407-01-44, Revision C, dated September 23, 2003; ASB 407-01-47, Revision B, dated June 24, 2003; and TB 407-03-43, dated September 22, 2003.

Transport Canada, the airworthiness authority for Canada, notified the FAA that an unsafe condition may exist on these helicopters models. Transport Canada advises that service history has shown high failure rates of bearings, P/N 407-340-339-101 and -103, at the oil cooler blower location. Service history also indicates bearings, P/N 407-340-339-101 and 407-340-339-103, located on the segmented tail rotor drive shaft have failed in flight. Transport Canada classified the ASBs as mandatory and issued AD CF-2002-18R2, dated November 5, 2003, and superseding AD CF-2002-18R3, dated March 26, 2004, to ensure the continued airworthiness of these helicopters.

This helicopter model is manufactured in Canada and is type certificated for operation in the United States under the provisions of 14 CFR 21.29 and the applicable bilateral agreement. Pursuant to the applicable bilateral agreement, Transport Canada has kept the FAA informed of the situation described above. The FAA has examined the findings of Transport Canada, reviewed all available information, and determined that AD action is necessary for products of this type design that are certificated for operation in the United States.

This previously described unsafe condition is likely to exist or develop on other helicopters of the same type design. The actions must be done following the service bulletins described previously. The short compliance time involved is required because the previously described critical unsafe condition can adversely affect the controllability or structural integrity of the helicopter. Therefore, this AD supersedes AD 2002-06-52 to require the following actions:

• On or before May 31, 2004, or within 200 hours time-in-service (TIS), whichever occurs first, modify the oil cooler fairing inlet ducts and airflow shields. Also, replace the oil cooler blower and segmented shaft bearings, P/N 406-040-339-ALL, 407-340-339-101 and 407-340-339-103, with improved bearings, P/N 407-340-339-107, and replace the warning lubrication decal. Also, replace temporary revision (TR)-9, dated January 15, 2002, that contains limitations prohibiting operations with a sustained tailwind greater than 5 knots, in the RFM, with TR-10, dated July 25, 2002. TR-10 eliminates the limitation on the prohibition on tailwind operation in TR-9 because of the incorporation of oil cooler blower inlet ducts and bearing airflow shields.

• At specified intervals, inspect bearings, P/N 406-040-339-ALL, 407-340-339-101, -103, and -107. If the bearing is rough, a seal is torn, the expelled grease has turned black, or metal particles are visible in the expelled grease, before further flight, replace the affected bearings with airworthy bearings, P/N 407-340-339-107, along with the modifications to the oil cooler inlet airflow. At specified intervals, lubricate the bearings.

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

• Affect 281 helicopters of U.S. registry;

• Take 50 work hours to modify the oil cooler fairing inlet ducts and to install the shields and 6.5 work hours to replace the bearings at an average labor rate of $65 per work hour; and

• Cost $6,500 for the 25-hour inspection and lubrication, assuming 100 helicopters are affected and must be inspected and lubricated once and it takes approximately 1/2 work hour for each lubrication and 1/2 work hour for each inspection and the average labor rate is $65 per work hour.

• Cost $3,419 for parts.

Based on these figures, we estimate the total cost impact of the AD on U.S. operators to be $1,999,212 to modify the entire fleet and assuming that the 100-hour repetitive inspections add no additional cost.

The cost impact figure listed above is based on assumptions that no operator has yet accomplished any of the requirements of this AD. However, numerous operators have previously accomplished the intent of this AD; therefore, the cost impact of the AD may be reduced accordingly.

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

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

Commenters wishing the FAA to acknowledge receipt of their mailed comments submitted in response to this rule must submit a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. 2004-SW-08-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.

A proposal to amend part 39 of the Federal Aviation Regulations (14 CFR part 39) to include an airworthiness directive (AD) that is applicable to certain Boeing Model 737-600, -700, -700C, -800, and -900 series airplanes equipped with certain Honeywell start converter units (SCU) was published in the Federal Register on August 9, 2002 (67 FR 51785). That action proposed to require replacement of certain SCUs with new, improved SCUs. The SCUs would be required to be replaced according to the Boeing 737-600/700/800/900 Aircraft Maintenance Manual (AMM) (the AMM includes procedures for Model 737-700C series airplanes).

Interested persons have been afforded an opportunity to participate in the making of this amendment. Due consideration has been given to the comments received.

Several commenters request that the compliance time of 18 months specified in the notice of proposed rulemaking (NPRM) be extended. The following justifications were provided by several commenters in support of their request to extend the compliance time from the proposed 18 months to compliance times ranging from 36 to 60 months.

One commenter states that, rather than specifying new replacement SCUs as described in the “Cost Impact” section of the NPRM, the SCUs should be described as “modified.” The commenter indicates that the time for rotation of an SCU through the modification program ranges from 40 to 45 days. The commenter expresses concern that the SCU manufacturer may not be able to support the proposed 18-month compliance time for all affected airplanes. For these reasons, the commenter requests that the FAA review any proprietary failure analysis of the airplane manufacturer to support a request for extension of the compliance time to 42 months.

One commenter states that it has two spare SCUs to be used in its replacement program, and that 54 airplanes of its fleet of 77 Model 737-800 series airplanes would require replacement. The commenter indicates that in order to meet the proposed 18-month compliance time, an additional two SCUs would have to be purchased at a cost of $420,000. The commenter requests that, to prevent such an expense, the compliance time be extended to 36 months.

One commenter estimates that the time from shipment of a discrepant SCU to the SCU manufacturer for modification and acquisition of the modified part would be 45 days. The operator states that it would need the compliance time extended to 42 months in order to replace all 42 of its SCUs.

Another commenter states that it would need the compliance time extended from 18 months due to the large number of SCUs that it will have to modify. Additionally, the commenter states that it would need the compliance time extended because of the effect the large worldwide volume of SCUs will have on the SCU manufacturer's turnaround times. Therefore, the commenter prefers that the compliance time be extended to 60 months, if possible, but adds that it would be acceptable to extend the compliance time to 36 months.

One commenter states that the service history of the Model 737-600, -700, and -800 series airplanes has shown that, in most cases, typical maintenance and operating procedures have limited the damage caused by failed electromagnetic interference (EMI) filter capacitors to the capacitors themselves. The commenter states that burning of the wire harness appears to occur only in conjunction with a high number of auxiliary power unit (APU) restart attempts with an illuminated APU fault light. The commenter states further that, of the six incidents that were reported as of the date of its comment submittal, only one resulted in burning the wire harness. That incident was discovered on an airplane that was being introduced into a domestic operator's fleet after having been operated by a non-U.S. airline. The commenter suspects that the SCU connector failure on that airplane was the result of being mishandled possibly by nonqualified personnel as evidenced by the 12 to 20 APU restart attempts made with an illuminated APU fault light.

One commenter, the SCU manufacturer, also states that the risk of an SCU connector overheat event that progresses to the point where aircraft wiring is damaged is considerably reduced if repeated APU start attempts are not made. The commenter also advises that it has issued a service information letter (SIL) that provides operators of the affected airplanes with direction regarding this issue. The commenter further states that, although the SIL is not an alternative method of compliance with the AD, it does provide additional protection against the identified unsafe condition. The commenter further states that the two events that occurred since the issuance of the service letter (August 16, 2000) were of reduced severity and no damage to the airplane wiring was recorded.

Another commenter, the airplane manufacturer, contends that, even in a worst case scenario, the risk to the fleet is minimal because the wiring damage does not present a hazard to the airplane or occupants. The commenter advises that an analysis was done for each system that could be affected and it was found that sufficient redundancy exists such that all potential combinations of lost functionality were extremely improbable. The commenter further advises that, since the SCU automatically removes power for this condition within 300 milliseconds, which limits smoke emission, the hazard presented by smoke or the smell of burning wires is minimized. Also, the wiring is self extinguishing and will not propagate fire and there are no flammable materials in the area. The commenter further notes that the electrical/electronic (E/E) bay is visually inspected per the zonal inspection program every 18 months or 4,000 flight cycles, whichever occurs first, for obvious unsatisfactory conditions, damage, failures, irregularities and/or discrepancies. In addition, the commenter specifies that the smoke clearing procedure can be used to eliminate any accumulated smoke and/or fumes.

Another commenter requests that the FAA review any failure analysis and extend the compliance time from 18 to 42 months.

The FAA agrees with the commenters' requests to extend the compliance time. However, we do not agree with certain commenters' justification for extending the compliance time solely on the basis of the potential disruption or negative impact on operator flight and maintenance schedules, or on other non-safety related aspects of airline operations. Those commenters did not address the impact that the requested increases in compliance time would have on airplane safety, or describe compensatory factors that would mitigate the increased exposure of the fleet to the potential unsafe condition as the result of a lengthened compliance time.

In addition, we reviewed the manufacturer's electrical power system safety assessment (which includes a failure analysis) for Boeing Model 737-600, -700, and -800 series airplanes. However, based on that review, we have determined that the safety assessment does not address all of the specific concerns that prompted the initiation of this AD.

We do agree that the compliance time may be extended based on the capability of the SCU manufacturer to perform the SCU modifications, the updated information provided by the airplane manufacturer regarding the number of SCU failures to date, the number of SCUs that have yet to receive the corrective modifications, and the rate at which the SCU manufacturer is currently able to perform the modifications.

Therefore, we have determined that the compliance time may be extended from 18 months to 36 months. We consider a 36-month compliance time will provide an acceptable level of safety, yet will allow operators sufficient time to process the remaining 514 unmodified in-service and spare SCUs through the SCU manufacturer's modification program without undue disruption of airline operations. We have revised paragraph (a) of the final rule accordingly.

One commenter requests that the FAA remove reference to the issuance date of Chapter 49-41-61 of the AMM specified in paragraph (a) of the NPRM. The commenter notes that by specifying a particular issuance date, operators are required to use that specific revision of the AMM. The commenter states that if the specific date was removed, operators could perform the replacement of the SCU per the latest revision of Chapter 49-41-61.

We do not agree that reference to the particular issuance date of Chapter 49-41-61 should be removed. In this case, that particular date is the specific revision of the chapter that we have reviewed and determined to be an appropriate source of service information for accomplishing the replacement of the SCU of the APU. To allow operators to use future revisions of Chapter 49-41-61, either we must revise the AD to reference specific later revisions, or operators must request approval to use later revisions as an alternative method of compliance with this AD under the provisions of paragraph (b) of this AD. Since the issuance of the NPRM, we have reviewed the current revision of Chapter 49-41-61, dated October 10, 2003, and have determined that it is also an acceptable source of service information. We have revised paragraph (a) of the final rule to specify that replacing the SCU of the APU must be accomplished per a method approved by the Manager, Seattle Aircraft Certification Office (ACO), FAA. However, we have also specified that Chapter 49-41-61, dated June 5, 1998, or dated October 10, 2003, is an approved method for the accomplishment of the requirements of paragraph (a) of this final rule.

Two commenters request that the compliance time specified in paragraph (b) of the NPRM be revised to match the compliance time specified in paragraph (a) of the NPRM for replacement of the affected SCUs. The commenters state that it is unrealistic to specify that, “as of the effective date of the AD, no person shall install on any airplane * * *,” due to the turnaround time to remove, modify, and install the SCUs (discussed in comments previously).

We acknowledge that, because of a possible delay in modifying the SCUs, the compliance time of the “spares” paragraph (b) in the NPRM is unrealistic. We consider that a condition could occur where operators remove the SCUs for modification and no modified spares are available for installation, effectively, grounding the airplane. Generally, the purpose of the “spares” paragraph is to ensure that unmodified or identified “unsafe” parts are not installed/reinstalled on airplanes, and specifically, prior to the compliance time specified for modification in paragraph (a) of the final rule. Therefore, there is no reason to include a “spares” paragraph in this AD with a compliance time that is identical to the threshold compliance time required by paragraph (a) of this AD. We have determined that, in this case, removal of the prohibition to install certain SCU part numbers as of the effective date of the AD is warranted, and we have removed paragraph (b) from the final rule and reidentified subsequent paragraphs accordingly.

One commenter states that, given the proven service experience of the Model 737 (NG) series airplanes and the limited number of burnt harnesses (one) reported, continuing to upgrade the SCUs at the normal attrition rate will provide an adequate level of safety. We infer that the commenter is requesting that we withdraw the NPRM.

We do not agree. We consider the SCU connector failures to be a safety issue of sufficient significance to warrant the removal, modification, and replacement of the SCUs via regulatory requirement rather than by relying on passive means such as attrition. Such reliance on attrition does not ensure that the affected airplanes will receive appropriately modified SCUs in a timely manner, or at all.

One commenter suggests that flight safety can be best preserved by amending the AFM to limit the number of start attempts with a consecutive fault illumination to a total of three including two restarts. The commenter states that requiring such an AFM limitation would be a more immediate action than waiting for the 18-month compliance time to replace/modify the SCUs, and would ensure that a burning harness would not occur in flight. The commenter notes that the Non-Normal Procedures Section of the Model 737 series airplane AFM currently allows restart attempts five minutes after the APU switch is placed in the “OFF” position and the APU fault light extinguishes.

We do not agree that adding a requirement to revise the AFM is appropriate at this time. An AFM limitation might reduce the short-term likelihood of filter capacitor failures, however, the limitation would be difficult to define since the number of repetitive start attempts after which the filter capacitors have been degraded to the point of failure has not been conclusively determined. Furthermore, an AFM limitation would not address long-term exposure of the fleet to the potential unsafe condition, since the cumulative effects of non-consecutive APU restart attempts on the filter capacitors also has not been determined. No change to the final rule is necessary.

One commenter, the SCU manufacturer, requests that the “Airworthiness Directives” heading be revised. The commenter suggests that the heading be revised to add the word “certain,” as follows: “Airworthiness Directives; Boeing Model 737-600, -700, -700C, -800, and -900 Series Airplanes Equipped” with “Certain” Honeywell Start Converter Units.” The commenter explains that adding the word “certain,” clarifies that not “all” SCU part numbers are affected on the applicable airplanes.

We agree with the commenter's request and have revised the heading accordingly.

One commenter, the SCU manufacturer, requests that the wording describing the replacement of the SCU with “a new, improved SCU” be revised to read, “a modified SCU.” The commenter indicates that, by specifying “a modified SCU,” operators would not be mislead into thinking that the SCU manufacturer would replace the existing SCU at no charge to the operators with SCUs that may be manufactured with technological advances over and above the SCUs specified in the NPRM.

We understand the commenter's position and agree that clarification is necessary. Since certain “new” production SCU part numbers incorporate design features that preclude the unsafe condition, we consider those “new” SCU part numbers to be acceptable replacements, and the table titled “SCU Part Numbers” of the final rule identifies the SCU part numbers that are acceptable as replacements. Therefore, we have revised the “Summary” section of the final rule to specify that replacement shall be with “a new or modified SCU.” Since the wording specified in the “Supplementary Information” section of the NPRM that discussed replacement with “a new, improved SCU” does not reappear in the final rule, it is not necessary to revise the final rule further in this regard.

One commenter, the SCU manufacturer, requests that the “Discussion” section of the NPRM be revised to specify the number of incidents and APU operating hours. The commenter suggests that the FAA state that there have been six reported incidents of SCU ARINC connector overheating in approximately 5 million APU operating hours (to September 6, 2002), and that two of these events showed visual damage to adjacent electrical wire bundles on certain Boeing Model 737-700 and -800 series airplanes. The commenter states that such revision of the “Discussion” section is necessary to minimize the possibility of misunderstanding the scope of the issue.

We do not agree that the “Discussion” section of the NPRM should be revised. We acknowledge that the number of incidents of SCU connector failure that resulted in the APU generator failures might provide additional useful background information. However, we note that we have recently received updated information from the airplane manufacturer regarding additional SCU connector failure events. In fact, as of October 3, 2003, the total number of SCU connector failure events had risen from six (as reported by the commenter) to ten. The number of events in which heat damage propagated to electrical wiring external to the SCU also increased from two to three. As discussed previously, the “Discussion” section does not reappear in the final rule. Therefore, no change to the final rule is necessary in this regard.

The same commenter, the SCU manufacturer, requests that a note be added at the end of the “Discussion” section of the NPRM to specify that during the investigation it was recognized that the extent of heat damage resulting from the event is proportional to the number of restarting attempts performed with an already failed unit. The commenter advises that Honeywell Service Information Letter (SIL) SIL 49-C-139 was issued to instruct the operator to recognize the fault indication and cease further starting attempts until troubleshooting can be performed. The commenter also states that events that occurred after the issue of SIL (2 events) were of reduced severity, and no damage to aircraft wiring was recorded. The commenter contends that observing the procedures described in the SIL effectively limits the extent of overheat damage.

We do not agree that the “Discussion” section of the NPRM should be revised per the commenter. No data has been submitted to the FAA to support the statement that the extent of heat damage resulting from an event is proportional to the number of restart attempts with an already failed unit. We do acknowledge, however, potential safety benefits of recognizing SCU failure indications in conjunction with terminating subsequent APU start attempts until appropriate maintenance and troubleshooting has been performed, as recommended in the above referenced Honeywell SIL. We consider that implementation of the procedures described in the Honeywell SIL until replacement of the SCUs may reduce the likelihood of SCU connector failures during the compliance period. As discussed previously, the “Discussion” section does not reappear in the final rule. Therefore, no change is necessary to the final rule in this regard.

One commenter, the SCU manufacturer, requests that the estimated number of airplanes currently affected by the NPRM be revised. The commenter states that it has completed modification of 198 SCU units since it submitted the original estimate of affected airplanes.

We agree that the estimated number of affected airplanes can be reduced. We also received updated information from the airplane manufacturer that confirmed a reduction of the number of affected airplanes. Therefore, we have revised the Cost Impact section of the final rule accordingly. See “Editorial Change to Labor Rate Estimate” paragraph below for other changes to the Cost Impact paragraph of this final rule.

One commenter, the SCU manufacturer, requests that the second column of the table in paragraph (a) of the NPRM be removed and replaced with certain other “acceptable” replacement part numbers. The commenter states that the table in paragraph (a) of the NPRM could be misleading by indicating that affected part numbers can only be replaced with the corresponding number in the right column. The commenter further states that listing the acceptable part numbers separately would clarify the requirement and indicate all acceptable SCU part numbers that may be installed on the airplane.

We agree that clarification is necessary. Based on information received from the airplane manufacturer, we have determined that SCUs having part numbers 1151858-241 (of any series) are not interchangeable with SCUs having part numbers 1152426-245 (of any series) or 1152466-250 (of any series). However, all SCUs having part numbers 1152426-245 and 1152466-250 of any series are interchangeable. Therefore, to prevent confusion regarding the selection of appropriate replacement SCUs, the table in paragraph (a) of the final rule has been revised to illustrate this clarification.

After careful review of the available data, including the comments noted above, the FAA has determined that air safety and the public interest require the adoption of the rule with the changes previously described. The FAA has determined that these changes will neither increase the economic burden on any operator nor increase the scope of the AD.

On July 10, 2002, the FAA issued a new version of 14 CFR part 39 (67 FR 47997, July 22, 2002), which governs the FAA's airworthiness directives system. The regulation now includes material that relates to altered products, special flight permits, and alternative methods of compliance. However, for clarity and consistency in this final rule, we have retained the language of the NPRM regarding that material.

After the NPRM was issued, we reviewed the figures we use to calculate the labor rate to do the required actions. To account for various inflationary costs in the airline industry, we find it appropriate to increase the labor rate used in these calculations from $60 per work hour to $65 per work hour. The economic impact information, below, has been revised to reflect this increase in the specified hourly labor rate.

There are approximately 403 airplanes of the affected design in the worldwide fleet. The FAA estimates that 250 airplanes of U.S. registry will be affected by this AD, that it will take approximately 4 work hours per airplane to accomplish the required actions, and that the average labor rate is $65 per work hour. Required parts will be provided by the parts manufacturer at no cost to operators. Based on these figures, the cost impact of the AD on U.S. operators is estimated to be $65,000, or $260 per airplane.

The cost impact figure discussed above is based on assumptions that no operator has yet accomplished any of the requirements of this AD action, and that no operator would accomplish those actions in the future if this AD were not adopted. The cost impact figures discussed in AD rulemaking actions represent only the time necessary to perform the specific actions actually required by the AD. These figures typically do not include incidental costs, such as the time required to gain access and close up, planning time, or time necessitated by other administrative actions.

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.

For the reasons discussed above, I certify that this action (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and (3) will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. A final evaluation has been prepared for this action and it is contained in the Rules Docket. A copy of it may be obtained from the Rules Docket at the location provided under the caption ADDRESSES .

Airworthiness Directive (AD) 2004-01-16, amendment 39-13430, applicable to certain McDonnell Douglas Model MD-11 and -11F airplanes, was published in the Federal Register on January 20, 2004 (69 FR 2659). That AD requires revising the wire connection stackups for the terminal strip of the generator feeder tail compartment of the auxiliary power unit (APU), and removing a nameplate, as applicable. For certain airplanes, that AD also requires replacing the terminal strips and revising the terminal hardware stackup for the feeder of the center cargo loading system.

As published, the phrase “as applicable” was inadvertently omitted from paragraph (a)(2) of AD 2004-01-16. As specified in the referenced service bulletin (McDonnell Douglas Alert Service Bulletin MD11-24A173, Revision 02, dated May 2, 2002), the inspection area is defined as follows:

1. For Group 1 airplanes: The aft cargo compartment; and

2. For Group 2 airplanes: Both the aft and center cargo compartments.

Without the phrasing “as applicable,” operators of Group 1 airplanes may misinterpret that both the aft and center cargo compartments must be inspected.

Since no other part of the regulatory information has been changed, the final rule is not being republished in the Federal Register .

The effective date of this AD remains February 24, 2004.

A final rule AD, FR Doc. 03-8327, that applies to RRD models BR700-710A1-10 and BR700-710A2-20 turbofan engines, was published in the Federal Register on April 11, 2003 (68 FR 17727). The following corrections are needed:

A proposal to amend part 39 of the Federal Aviation Regulations (14 CFR part 39) to include an AD that applies to CFM International, S.A., CFM56-2-C, -3 series, and -5 series turbofan engines was published in the Federal Register on May 16, 2003, (68 FR 26553). That action proposed to require removing from service main fuel pumps with bronze bearings and installing main fuel pumps with aluminum/bronze bearings.

Interested persons have been afforded an opportunity to participate in the making of this amendment. Due consideration has been given to the comments received.

Two commenters request that the proposed terminating action reference main fuel pump configurations introduced in conjunction with FAA AD 2000-15-01. CFM56-3 Service Bulletin (SB) 73-0120, Revision 4, dated July 27, 2000, and CFM56-5 SB 73-0126, Revision 3, dated September 25, 2000, did not include the part configurations introduced by CFM56-3/3B/3C SB 73-A129 or CFM56-5 SB 73-A143. Comments were specifically related to CFM56-3/3B/3C SB 73-0120, Revision 4, and SB 73-A129.

The FAA agrees. Since the issuance of the proposed rule, CFM56-3 SB 73-0120, Revision 4, dated July 27, 2000, and CFM56-5 SB 73-0126, Revision 3, dated September 25, 2000, have been revised to include hardware defined by CFM56-3/3B/3C SB 73-A129 and CFM56-5 SB 73-A143. The latest revisions of CFM56-2 SB 73-0104, CFM56-3 SB 73-0120, and CFM56-5 SB 73-0126 are referenced in the final rule.

Three commenters request that additional replacement parts be specified as AMOCs. The commenters believe that dual-sourced parts can be less costly.

The FAA does not agree. The AD does not make specific hardware replacement recommendations. The AD mandates that unserviceable parts be replaced with serviceable parts. The AD did not change as a result of this comment.

One commenter provided additional information on the documented failure modes and requests that the Summary and Discussion statements be modified. The modification would note that the bi-metal bearing was introduced to prevent main fuel pump failures that result in a fuel flow degradation. This degradation could lead to diminished engine start or in-flight restart capability.

The FAA agrees. The initial introduction of the bi-metal bearing was intended to address a specific failure mode that is not the subject of this AD. A further benefit of the bi-metal, aluminum/bronze bearings is that they are less likely to generate debris and create the unsafe condition that this AD addresses. The Summary paragraph in the AD has been modified to better describe the debris-related failure mode. We have noted the commenter's request to clarify the Discussion section of the NPRM; however, the Discussion section does not carry over to the final rule.

One commenter believes that the number of engines affected is incorrect. The commenter has provided additional information on the quantity of engines affected and the cost of incorporating bi-metal aluminum/bronze bearings. The commenter believes that there would be no additional labor or material costs for converting affected main fuel pumps because the conversion should occur within the scheduled refurbishment of the pump.

The FAA partially agrees. We agree that the initial estimate of the number of engines affected was too high and that the assumption that an affected main fuel pump would be replaced with a new, zero-time part was unrealistic. However, we do not agree that all of the material costs associated with the conversion of a main fuel pump to a serviceable part would be achieved during regularly scheduled maintenance. The number of affected engines and total cost of incorporating the bi-metal bearings have been adjusted based on the estimated hardware consumption to date. The corrective action cost was also adjusted to reflect bearing incorporation by refurbishment. The bearing hardware has been treated as an incremental cost as there will be unscheduled conversions either because of forced main fuel pump removals or differing workscope practices. The Economic Analysis has been revised in the final rule.

One commenter requests that compliance paragraph (a)(2) end with the phrase “if SB 73-081 is accomplished.” The commenter believes that by adding this phrase the part numbers to be removed from service will be clarified.

The FAA does not agree. Compliance paragraph (a)(2) states the following: “For all CFM56-2-C series engines that have incorporated CFM International Service Bulletin (SB) (CFM56-2) 73-081 * * *”. The final rule did not change as a result of this comment.

One commenter requests that compliance paragraph (b)(3) end with the phrase “if SB 73-087 is accomplished.” The commenter believes that by adding this phrase, the part numbers to be removed from service will be clarified.

The FAA does not agree. Compliance paragraph (b)(3) states the following: “For all CFM56-3 series engines that have incorporated SB (CFM56-3) 73-087 * * *”. The final rule did not change as a result of this comment.

One commenter requests that compliance paragraph (b)(3) include a phrase to reference the lack of compliance with CFM56-3 SB 73-120. The commenter believes that by adding the phrase “but have not incorporated SB 73-120,” as a qualification for Compliance paragraph (b)(3), the part numbers to be removed from service will be clarified.

The FAA does not agree. The referenced part numbers in paragraph (b)(3) reflect the lack of compliance with CFM56-3 SB 73-120. The final rule did not change as a result of this comment.

One commenter requests that the compliance statement in the Regulatory section of the AD be changed from “required at the next engine removal, engine module removal, or main fuel pump removal” to “required at the next shop visit, or main fuel pump replacement.” The commenter suggests that the next shop visit should be defined as removal from the aircraft for the purposes of maintenance and inspection except when removed for the purpose of performing field maintenance type activities at a maintenance facility in lieu of performing them on wing. The commenter suggests that a main fuel pump shop visit would be defined as removal of the pump for the purpose of sending it to a shop capable of performing the specified modification regardless of other planned pump maintenance. The commenter suggests that an engine module would be clarified as the fan, core, or low-pressure turbine to avoid confusion with any other parts of the engine that might be referred to as a module. The commenter feels that these changes would allow easier scheduling of the required corrective actions.

The FAA partially agrees. We agree that next engine shop visit or main fuel pump replacement is a better description of the intended threshold. However we do not agree with the proposed qualifications for each action. For simplification and to assure expedient incorporation at the first opportunity, we have revised the compliance statement to “next engine shop visit or main fuel pump replacement, whichever comes earlier.” We have added a definitions paragraph (e) to the Regulatory Section that defines “engine shop visit” as any maintenance that includes the separation of an engine casing flange.

Two commenters state that the compliance terminating action date will result in premature main fuel pump removals. One of the commenters requests that the compliance terminating action date of January 1, 2007, be extended.

The FAA disagrees. The corrective action compliance period allows for sufficient planning for main fuel pump replacement during regularly scheduled maintenance. The projected incorporation rate does not allow an extension of the terminating action date.

One commenter requests the corrective action requirement be revised to include the incorporation of a downstream fuel filter as an AMOC to preclude fuel nozzle clogging and related LPT overtemperature damages. The commenter referenced CFM56-3 SB 73-0134. The commenter states that together with the main fuel pump interstage filter, the addition of a downstream fuel filter will provide greater engine protection. The commenter also states that a downstream fuel filter is more economical than the proposed main fuel pump modification.

The FAA does not agree. Analysis based on fleet experience indicates safety margins are maintained with the conversion of the bi-metal, gear-stage bearings. Vendor data shows that the main fuel pump gear-stage bearings would normally be replaced during pump refurbishment. Recommending incorporation of the downstream fuel filter is not justified at this time. The AD did not change as a result of this comment.

After the issuance of the NPRM, we discovered that the CFM56-2-C engine had been incorrectly listed as CFM56-2C. We have corrected the engine model in the AD.

Paragraph (a)(2) of the NPRM Regulatory text for the CFM56-2-C included pump part numbers (P/Ns) 301-778-801-0, 301-778-802-0, 301-778-804-0, and 301-778-805-0 with pumps that had incorporated CFM56-2 SB 73-081. Further review revealed these parts were originally CFM56-3 hardware that could incorporate bronze bearings following CFM56-3 SB 73-087. CFM56-2 SB 73-0070 subsequently released these parts for use on the CFM56-2-C engine. We have added a new Regulatory text paragraph (a)(3) in the AD to highlight that these pumps could incorporate bronze bearings by a CFM56-3 SB. The codification of paragraph (a) is changed from (a)(1), (2), (3), (4) to (a)(1), (2), (3), (4), and (5) in the AD as a result of this comment.

The addition of Regulatory text paragraph (a)(3) in the AD results in the addition of Regulatory text paragraph (d)(3) in the AD. The codification of paragraph (d) is changed from (d)(1), (2), and (3) to (d)(1), (2), (3), and (4) in the AD.

Paragraph (a)(3) of the NPRM Regulatory text for the CFM56-2-C inadvertently referenced CFM56-2-C SB 73-078 as defining P/N 301-779-006-0. That SB is incorrect. The correct SB that defines P/N 301-779-006-0 is CFM56-2 SB 73-A113. We have corrected the SB reference in the newly recodified paragraph (a)(4) of the AD.

Paragraph (b)(2) of the NPRM Regulatory text for the CFM56-3 inadvertently referenced CFM56-3 SB 73-082 as defining pump P/N 301-779-006-0. That SB is incorrect. The correct SB that defines pump P/N 301-779-006-0 is CFM56-3 SB 73-A129. We have corrected the SB reference in paragraph (b)(2) of the AD.

After careful review of the available data, including the comments noted above, the FAA has determined that air safety and the public interest require the adoption of the rule with the changes described previously. The FAA has determined that these changes will neither increase the economic burden on any operator nor increase the scope of the AD.

There are approximately 6,160 CFM56-2-C, -3 series, and -5 series turbofan engines of the affected design in the worldwide fleet. The FAA estimates that 975 engines installed on airplanes of U.S. registry would be affected by this AD. Assuming an average incorporation rate of 325 pumps per year and an incremental material cost of $8,000, the cost for U.S. operators to replace the bronze bearings is estimated to be $2,600,000 per year.

This final rule does not have federalism implications, as defined in Executive Order 13132, because it would not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. Accordingly, the FAA has not consulted with state authorities prior to publication of this final rule.

For the reasons discussed above, I certify that this action (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and (3) will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act. A final evaluation has been prepared for this action and it is contained in the Rules Docket. A copy of it may be obtained by contacting the Rules Docket at the location provided under the caption ADDRESSES .

This amendment to 14 CFR part 71 establishes a Class D airspace designation for an airspace area from the surface up to but not including 2,500 feet MSL at Denton Municipal Airport, Denton, TX and will be published in paragraph 5000 of FAA Order 7400.9L, dated September 2, 2003, and effective September 16, 2003, which is incorporated by reference in 14 CFR 71.1.

The FAA anticipates that this regulation will not result in an adverse or negative comment, and, therefore, issues it as a direct final rule. The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. Unless a written adverse or negative comment, or a written notice of intent to submit an adverse or negative comment is received within the comment period, the regulation will become effective on the date specified. After the close of the comment period, the FAA will publish a document in the Federal Register indicating that no adverse or negative comments were received and confirming the date on which the final rule will become effective. If the FAA does receive, within the comment period, an adverse or negative comment, or written notice of intent to submit such a comment, a document withdrawing the direct final rule will be published in the Federal Register, and a notice of proposed rulemaking may be published with a new comment period.

Although this action is in the form of a direct final rule, and was not preceded by a notice of proposed rulemaking, interested persons are invited to comment on this rule by submitting such written data, views, or arguments as they may desire. Communications must identify both docket numbers. All communications received on or before the closing date for comments will be considered, and this rule may be amended or withdrawn in light of the comments received. Factual information that supports the commenter's ideas and suggestions is extremely helpful in evaluating the effectiveness of this action and determining whether additional rulemaking action would be needed.

Comments are specifically invited on the overall regulatory, economic, environmental, and energy aspects of the rule that might suggest a need to modify the rule. All comments submitted will be available, 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 action will be filed in the Rules Docket.

This rule does not have federalism implications, as defined in Executive Order No. 13132, because it does 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. Accordingly, the FAA has not consulted with state authorities prior to publication of this rule.

The FAA has determined that this regulation is noncontroversial and unlikely to result in adverse or negative comments. For the reasons discussed in the preamble, I certify that this regulation (1) is not a “significiant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under Department of Transportation (DOT) Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as these routine matters will only affect air traffic procedures and air navigation. It is certified that this rule will not have significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA published this direct final rule with a request for comments in the Federal Register on March 5, 2004 (69 FR 10328). The FAA uses the direct final rulemaking procedure for a non-controversial rule where the FAA believes that there will be no adverse public comment. This direct final rule advised the public that no adverse comments were anticipated, and that unless a written adverse comment, or a written notice of intent to submit such an adverse comment, were received within the comment period, the regulation would become effective on April 15, 2004. No adverse comments were received, and thus this notice confirms that this direct final rule will become effective on that date.

This amendment to 14 CFR part 71 establishes a Class E airspace area extending upward from 700 feet above the surface of Clayton, NM and will be published in paragraph 6005 of FAA Order 7400.9L, dated September 2, 2003, and effective September 16, 2003, which is incorporated by reference in 14 CFR 71.1.

The FAA anticipates that this regulation will not result in an adverse or negative comment, and, therefore, issues it as a direct final rule. The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. Unless a written adverse or negative comment, or a written notice of intent to submit an adverse or negative comment is received within the comment period, the regulation will become effective on the date specified. After the close of the comment period, the FAA will publish a document in the Federal Register indicating that no adverse or negative comments were received and confirming the date on which the final rule will become effective. If the FAA does receive, within the comment period, an adverse or negative comment, or written notice of an intent to submit such a comment, a document withdrawing the direct final rule will be published in the Federal Register, and a notice of proposed rulemaking may be published with a new comment period.

Although this action is in the form of a direct final rule, and was not preceded by a notice of proposed rulemaking, interested persons are invited to comment on this rule by submitting such written data, views, or arguments as they may desire. Communications must identify both docket numbers. All communications received on or before the closing date for comments will be considered, and this rule may be amended or withdrawn in light of the comments received. Factual information that supports the commenter's ideas and suggestions is extremely helpful in evaluating the effectiveness of this action and determining whether additional rulemaking action would be needed.

Comments are specifically invited on the overall regulatory, economic. environmental, and energy aspects of the rule that might suggest a need to modify the rule. All comments submitted will be available, 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 action will be filed in the Rules Docket.

This rule does not have federalism implications, as defined in Executive Order No. 13132, because it does not have a substantial direct effective 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. Accordingly, the FAA has not consulted with state authorities prior to publication of this rule.

The FAA has determined that this regulation is noncontroversial and unlikely to result in adverse or negative comments. For the reasons discussed in the preamble, I certify that this regulation (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under Department of Transportation (DOT) Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as these routine matters will only affect air traffic procedures and air navigation. It is certified that this rule will not have significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

This amendment to 14 CFR part 71 establishes a Class E airspace area extending upward from 700 feet above the surface of Galliano, LA and will be published in paragraph 6005 of FAA Order 7400.9L, dated September 2, 2003, and effective September 16, 2003, which is incorporated by reference in 14 CFR 71.1.

The FAA anticipates that this regulation will not result in an adverse or negative comment, and, therefore, issues it as a direct final rule. The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. Unless a written adverse or negative comment, or a written notice of intent to submit an adverse or negative comment is received within the comment period, the regulation will become effective on the date specified. After the close of the comment period, the FAA will publish a document in the Federal Register indicating that no adverse or negative comments were received and confirming the date on which the final rule will become effective. If the FAA receives, within the comment period, an adverse or negative comment, or written notice of an intent to submit such a comment, a document withdrawing the direct final rule will be published in the Federal Register , and a notice of proposed rulemaking may be published with a new comment period.

Although this action is in the form of a direct final rule, and was not preceded by a notice of proposed rulemaking, interested persons are invited to comment on this rule by submitting such written data, views, or arguments as they may desire. Communications must identify both docket numbers. All communications received on or before the closing date for comments will be considered, and this rule may be amended or withdrawn in light of the comments received. Factual information that supports the commenter's ideas and suggestions is extremely helpful in evaluating the effectiveness of this action and determining whether additional rulemaking action would be needed.

Comments are specifically invited on the overall regulatory, economic, environmental, and energy aspects of the rule that might suggest a need to modify the rule. All comments submitted will be available, 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 action will be filed in the Rules Docket.

This rule does not have federalism implications, as defined in Executive Order No. 13132, because it does 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. Accordingly, the FAA has not consulted with state authorities prior to publication of this rule.

The FAA has determined that this regulation is noncontroversial and unlikely to result in adverse or negative comments. For the reasons discussed in the preamble, I certify that this regulation (1) is not a “significant regulatory action’ under Executive Order 12866; (2) is not a “significant rule” under Department of Transportation (DOT) Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and (3) does not warrant preparation of a Regulatory Evaluation as these routine matters will only affect air traffic procedures and air navigation. It is certified that this rule will not have significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The recently enacted Fair and Accurate Credit Transactions Act of 2003 (“FACT Act”) requires the FTC to adopt a number of rules to implement several of its provisions, which amend the Fair Credit Reporting Act (“FCRA”). The Commission has published one final rule, Effective Dates for the FACT Act (69 FR 6526; Feb. 11, 2004) (the “effective dates rule”) and one interim final rule, Prohibition Against Circumventing Treatment as a Nationwide Consumer Reporting Agency (69 FR 8532; Feb. 24, 2004) (the “circumvention rule”). All FACT Act rules will be published in Title 16, Chapter I, Subchapter F, of the Code of Federal Regulations (“CFR”), which is labeled “Fair Credit Reporting Act.” In the CFR, the effective dates rule was designated as Part 602; the circumvention rule was designated as Part 603. Subsequently, the Commission published more proposed rules, including Free Annual File Disclosures (69 FR 13192; Mar. 19, 2004) (the “free reports rule”) and Identity Theft Definitions (69 FR 23369; Apr. 28, 2004) (the “definitions rule”). In the CFR, the proposed free reports rule was designated as Part 610; the proposed definitions rule was designated as Part 603.

In this document, the Commission makes non-substantive revisions to the effective dates rule in Part 602, and establishes a new Part 611, containing the provisions of the circumvention rule previously issued as Part 603. In addition, the Commission revises Part 603 ( i.e., the heading and § 603.1) to state that terms defined in the FCRA have the same meaning in the FCRA rules unless otherwise stated in those rules. Finally, the Commission adds a new Part 604, which states that any court ruling staying or invalidating any provision of any FCRA rule has no impact on the continuing effectiveness of any other provision or rule (new § 604.1). The above changes are described in greater detail below.

To achieve a clearer and more logical structure for its FCRA rules, the Commission is making certain non-substantive, technical changes to several CFR parts in which those rules appear. Specifically, the Commission is making three technical revisions to 16 CFR Part 602, which contains the effective dates rule. First, the Commission is changing the heading of that part from “Fair Credit Reporting Act,” which unnecessarily duplicates the heading of Subchapter F, to “Fair and Accurate Credit Transactions Act of 2003,” which more specifically describes the nature of the rules that are subject to the effective dates set forth in Part 602. Second, the Commission is changing the heading of § 602.1 from “Purpose, scope, and effective dates” to “Effective dates” and deleting references to topics other than effective dates, because there are no provisions on other topics in this section. Third, it changes the description of §602.1(c)(3)(xi) from “concerning enhanced disclosure of the means available to opt out of prescreened lists' to “concerning duration of elections” to more accurately describe the FACT Act provision involved. This revision is purely descriptive in nature and is intended neither to alter any effective date adopted jointly by the Commission and the Federal Reserve Board, nor to have any other effect whatsoever on any legal rights or obligations that may arise under any rule or other requirement arising under the FACT Act.

Further, the Commission is changing the designation of the previously issued circumvention rule, 1 by revising Part 603 to eliminate those provisions from that part and incorporating them instead into a new Part 611. This change will avoid any conflict with the proposed definitions rule, which, if finally adopted, will be issued in Part 603. This change allows for a rational arrangement of the Commission's FCRA rules in 16 CFR, whereby rules of general applicability would be contained in Parts 600-609, and rules applying to consumer reporting agencies would start with the proposed free reports rule in Part 610. Thus, the rule against circumventing the duty to provide free reports (Part 611) would immediately follow the free reports rule. The Commission anticipates proposing as Part 612 a rule concerning a reasonable fee for disclosure of scores by consumer reporting agencies, pursuant to Section 212(b) of the FACT Act, and has already proposed two rules relating to identity theft as Part 613 (Duration of Active Duty Alerts) and Part 614 (Appropriate Proof of Identity) (69 FR 23369; Apr. 28, 2004).

Aside from the above organizational changes, the Commission is adding certain provisions that, without making substantive alterations, clarify the relationship between the statutory definitions and the Commission's rules, and the effect, if any, on those rules if a particular rule provision were to be invalidated.

The Commission anticipates that some of its FACT Act rules may use terms that are already defined in the FCRA. Accordingly, the Commission is amending Part 603 (which no longer contains the circumvention rule) to revise the heading (to “Definitions”) and specify in § 603.1 that any term used in any Commission FACT Act (or other FCRA) rule has the same meaning as in the FCRA unless otherwise specified in that rule. This provision will make it unnecessary for each rule to state that terms have the same meaning as in the FCRA.

Finally, the Commission adds a new Part 604 and § 604.1 containing a severability provision similar to that in other recent Commission rules. (See, e.g. , the Telemarketing Sales Rule, 16 CFR 310.8.) This provision will ensure the effectiveness of all the Commission's FCRA rules, in the event that any rule (or any provision of any rule) is declared invalid by a court.

The Administrative Procedure Act, 5 U.S.C. 551 et seq. , generally requires an agency to publish a notice of a proposed rule and afford interested persons an opportunity to provide comments prior to promulgation of the rule. Notice of the proposed rule and an opportunity for public comment are not required “when the agency for good cause finds (and incorporates the finding and a brief statement of reasons therefore in the rules issued) that notice and public procedure thereon are impracticable, unnecessary, or contrary to the public interest.” 5 U.S.C. 553(b)(3)(B).

The Commission finds good cause for adopting these rules without advance public notice or comment. The FACT Act requires the Commission to promulgate a large number of rules implementing various amendments to the FCRA, all of which will appear in 16 CFR, Chapter I, Subchapter F, “Fair Credit Reporting Act.” It has finalized some rules, proposed others, and will propose and finalize more in the coming months. It is important that FACT Act rules be appropriately organized and labeled in the CFR so they can be easily accessed by the public. Similarly, addition of the severability and FCRA definitions provisions will avoid possible uncertainties relating to the Commission's FACT Act rules. The revisions described above, however, are purely technical in nature, and are not intended to make any substantive change in the legal rights or obligations as defined or to be defined by the Commission's rules. Rather, the changes merely clarify the organizational structure and relationship of the rules, including the severability of its provisions, and to reiterate relevant terms already defined by statute. For these reasons, the FTC finds that issuing these rule changes with prior notice and comment is unnecessary, and would be contrary to the public interest to the extent it would delay publication of the clarifications and interfere with the timely and orderly promulgation of the relevant substantive rules. 5 U.S.C. 553(b)(3)(B). Accordingly, the Commission finds that there is good cause for adopting these rules as effective without prior public comment.

In accordance with the Paperwork Reduction Act of 1995, 44 U.S.C. 3506; 5 CFR 1320 Appendix A.1, the FTC has reviewed these final rule changes. The Commission has determined that these changes neither affect nor contain any collection of information requirements subject to Office of Management and Budget review under the Paperwork Reduction Act. The rule changes do not require any entity to collect, maintain, disclose, or submit any records or other information.

The Regulatory Flexibility Act, 5 U.S.C. 601-612, requires an agency to provide an Initial Regulatory Flexibility Analysis with a proposed rule and a Final Regulatory Flexibility Analysis with the final rule, if any, unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. See 5 U.S.C. 603-605. The FTC certifies that these rules are entirely technical in nature and thus will not have a significant economic impact on a substantial number of small entities. This document serves as notice to the Small Business Administration of the agency's certification of no effect.

Section 103(a) of the Sarbanes-Oxley Act of 2002 (the “Act”) authorized the PCAOB to establish auditing and related professional practice standards to be used by registered public accounting firms. 1 On December 23, 2003, the PCAOB filed with the Commission proposed Auditing Standard No. 1, References in Auditing Reports to the Standards of the Public Company Accounting Oversight Board. 2 After soliciting comments on the proposed standard, 3 the Commission today approved Auditing Standard No. 1, effective for auditors' reports issued or reissued on or after May 24, 2004. 4 Auditing Standard No. 1 directly impacts certain of the Commission's rules, regulations, releases and staff bulletins (collectively referred to in this release as “Commission rules and staff guidance”) and certain provisions in the federal securities laws, which refer to Generally Accepted Auditing Standards (“GAAS”) and to specific standards under GAAS (including related professional practice standards), because it directs auditors to cease referring to GAAS in audit reports relating to financial statements of issuers and instead to refer to the “standards of the Public Company Accounting Oversight Board (United States).”  5 The Commission is therefore issuing interpretive guidance to avoid confusion on the part of issuers, auditors and investors. The guidance in this release is applicable only to auditors' engagements that are governed by PCAOB rules. 6

PCAOB Rule 3100 requires registered public accounting firms and their associated persons to comply with all applicable auditing and related professional practice standards established or adopted by the PCAOB. Because of this and because the PCAOB has adopted interim standards incorporating generally accepted auditing standards, references to GAAS and standards established by the American Institute of Certified Public Accountants (the “AICPA”) are now superseded. Auditing Standard No. 1 requires that an auditor's report issued in connection with any engagement performed in accordance with the auditing and related professional practice standards of the PCAOB state that the engagement was performed in accordance with “the standards of the Public Company Accounting Oversight Board (United States).”  7 In addition, Auditing Standard No. 1 states that “a reference to generally accepted auditing standards in auditors' reports is no longer appropriate or necessary.”  8

Many parts of Commission rules and staff guidance include direct references to GAAS. For example, Regulation S-X, which, together with the Commission's Financial Reporting Releases, sets forth the form and content of and requirements for financial statements required to be filed with the Commission, 9 includes Rule 2-02 regarding the accountant's report. 10 Rule 2-02 of Regulation S-X states in relevant part:

Moreover, some Commission rules and staff guidance refer to specific auditing standards under GAAS. For example, Accounting Series Release No. 296, which is now in Section 601 of Financial Reporting Codification, references AU 220.03 of the Codification of Auditing Standards published by the AICPA. 12 Finally, some parts of Commission rules and staff guidance could be said to include indirect references to GAAS because in releases or staff bulletins the Commission or its staff has interpreted rules and regulations by directing registrants, auditors and investors to GAAS.

In addition, the federal securities laws refer to GAAS. Specifically Section 10A(a) of the Securities Exchange Act of 1934 states:

Given the possible confusion between Commission rules and staff guidance and references in the federal securities laws, on the one hand, and the PCAOB's rules, on the other hand, the Commission believes it is necessary to publish the guidance in this release. Effective immediately, references in Commission rules and staff guidance and in the federal securities laws to GAAS or to specific standards under GAAS, as they relate to issuers, should be understood to mean the standards of the PCAOB plus any applicable rules of the Commission. The Commission intends to codify this interpretation in the near future.

It should be noted that although the PCAOB has stated that Auditing Standard No. 1 supersedes references to “generally accepted auditing standards,” “U.S. generally accepted auditing standards,” “auditing standards generally accepted in the United States of America,” and “standards established by the AICPA,”  14 Auditing Standard No. 1 does not supersede Commission rules or regulations. Section 3(c) of the Act provides that “[n]othing in this Act or the rules of the Board shall be construed to impair or limit * * * (2) the authority of the Commission to set standards for accounting or auditing practices or auditor independence, derived from other provisions of the securities laws or the rules or regulations thereunder, for purposes of the preparation and issuance of any audit report, or otherwise under applicable law * * *.” When an independent accountant prepares a report for submission or filing with the Commission, the independent accountant would be considered to be representing that it has complied with the applicable federal securities laws and Commission rules and guidance, as well as with the standards of the Public Company Accounting Oversight Board (United States), as referenced explicitly in Auditing Standard No. 1. In a note to PCAOB Rule 3600T, Interim Independence Standards, the Board specifically provided that the PCAOB's rules do not supersede the Commission's rules, and, therefore, registered public accounting firms must comply with the more restrictive of the Commission's or the Board's rules.

Some registrants are able to incorporate by reference previously issued and filed reports by including an auditor's consent to the use of their report in the registrant's filing that requires the audit report. If a registrant incorporates by reference a report previously filed with the Commission, rather than including a new report in the filing, the report incorporated by reference would not need to include the otherwise-required reference to the standards of the PCAOB.

This document contains amendments to 26 CFR part 1 under section 263A(f) of the Internal Revenue Code (Code) relating to the treatment of certain interest expense incurred by the lessor in a sale and leaseback transaction under the ERTA safe harbor leasing provisions (former section 168(f)(8), as enacted by section 201(a) of ERTA, Public Law 97-34, 95 Stat. 214).

Section 263A (the uniform capitalization rules) generally requires the capitalization of direct costs and indirect costs properly allocable to real property and tangible personal property produced by a taxpayer.

Section 263A(f) and the regulations thereunder provide special rules for capitalizing interest to property produced by a taxpayer. In general, section 263A(f) only requires the capitalization of interest that is paid or incurred during the production period of certain property (referred to as designated property). Designated property includes all real property and certain tangible personal property. See § 1.263A-8(b) of the Income Tax Regulations.

In general, interest incurred on debt that is directly attributable to production expenditures with respect to designated property (traced debt) is capitalized first. See section 263A(f)(2)(A)(i). If production expenditures with respect to designated property exceed the amount of traced debt, interest on any other debt of the taxpayer is capitalized to the extent that the interest could have been reduced if production expenditures had not been incurred. See section 263A(f)(2)(A)(ii). The amount of interest required to be capitalized under section 263A(f) is calculated by reference to eligible debt. See § 1.263A-9(a)(4). Eligible debt generally includes all outstanding debt of the taxpayer. Certain types of debt (listed in paragraphs (i) to (viii) of § 1.263A-9(a)(4)), however, are excluded from the definition of eligible debt.

The ERTA safe harbor leasing provisions were intended to permit owners of property to transfer the tax benefits of ownership (depreciation and the investment credit) to other persons. The ERTA safe harbor leasing provisions operate by guaranteeing that, for federal tax purposes, (i) a transaction meeting certain stated qualifications (a qualifying transaction) will be treated as a lease even though the qualifying transaction otherwise would not be considered a lease, and (ii) the nominal lessor will be treated as the owner of the property even though the nominal lessee is in substance the owner of the property.

Regulations issued under the ERTA safe harbor leasing provisions clarify that a qualifying transaction may be part of a sale and leaseback transaction, in which the nominal lessee sells the underlying property for Federal tax purposes to the nominal lessor for a cash payment and an interest bearing note (purchase money note), and the nominal lessor simultaneously leases the property back to the nominal lessee. See § 5c.168(f)(8)-1(e) Example 2. Generally, the nominal lessor deducts, and the nominal lessee includes in income, the interest accruing on the purchase money note, subject to certain limitations. See § 5c.168(f)(8)-7.

The temporary regulations provide that eligible debt under section 263A(f) does not include a purchase money obligation given by the lessor to the lessee (or a party related to the lessee) in a sale and leaseback transaction under former section 168(f)(8) as enacted by ERTA. Accordingly, these obligations are excluded from the definition of eligible debt, and the interest accruing on the obligations is not subject to capitalization with respect to designated property under section 263A(f).

The temporary regulations apply to interest incurred in taxable years beginning on or after May 20, 2004, except that, in the case of property that is inventory in the hands of the taxpayer, the temporary regulations apply to taxable years beginning on or after May 20, 2004. However, taxpayers may elect to apply the temporary regulations to interest incurred in taxable years beginning on or after January 1, 1995, or, in the case of property that is inventory in the hands of the taxpayer, to taxable years beginning on or after January 1, 1995 (the general effective date of the interest capitalization regulations).

For purposes of § 1.263A-15(a)(2), the exclusion of purchase money obligations given by the lessor to the lessee (or a party related to the lessee) in a sale and leaseback transaction under former section 168(f)(8) as enacted by ERTA will be considered to be a reasonable position for the application of section 263A(f) in taxable years beginning before January 1, 1995. Consequently, a taxpayer changing a method of accounting for property that is not inventory in the hands of the taxpayer to conform to the temporary regulations may elect to include interest incurred after December 31, 1986, in taxable years beginning on or after December 31, 1986 (the general effective date of section 263A), and before January 1, 1995, in the determination of its adjustment under section 481(a). A taxpayer changing a method of accounting for property that is inventory in the hands of the taxpayer to conform to the temporary regulations must revalue its beginning inventory in the year of change as if the new method of accounting had been in effect during all prior years.

It has been determined that this Treasury decision is not a significant regulatory action as defined in Executive Order 12866. Therefore, a regulatory assessment is not required. It also has been determined that section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not apply to these regulations. Please refer to the cross-referenced notice of proposed rulemaking published elsewhere in this issue of the Federal Register for applicability of the Regulatory Flexibility Act (5 U.S.C. chapter 6). Pursuant to section 7805(f) of the Code, these temporary regulations will be submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on their impact on small business.

The principal author of these regulations is Grant Anderson of the Office of Associate Chief Counsel (Income Tax and Accounting). However, other personnel from the IRS and the Treasury Department participated in their development.

We did not publish a notice of proposed rulemaking (NPRM) for this regulation. Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing an NPRM. The Coast Guard is taking this action for the immediate protection of vessels and personnel operating in the vicinity of the grounded Motor Vessel LeConte.

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 . Publication of a notice of proposed rulemaking and delay of effective date would be contrary to the public interest because immediate action is necessary to provide for the safety of persons and vessels conducting salvage and environmental clean-up operations in the vicinity of the Motor Vessel LeConte. Because of the danger posed by the damaged vessel, immediate action is necessary to provide for the safety of mariners.

The Coast Guard is establishing a temporary safety zone that will restrict vessel traffic in the vicinity of Cozian Reef, Peril Strait, within one-half mile of the Motor Vessel LeConte. Vessels are prohibited from entering the zone without the permission of the Captain of the Port, Southeast Alaska. The temporary safety zone is necessary to protect mariners from the hazards associated with the ongoing operations around the Motor Vessel LeConte. Public notifications will be made via marine broadcasts and other advisories so mariners can adjust their plans accordingly. Coast Guard vessels operating in the vicinity of Cozian Reef will also advise mariners of the area closure.

The Coast Guard is establishing a safety zone around the Motor Vessel LeConte, which has run aground on Cozian Reef in position 57°34′ N, 135°26′ W. The zone will comprise an area one-half mile around the Motor Vessel LeConte. Within the zone, only vessels with the permission of the Captain of the Port, Southeast Alaska are permitted to enter. The limited size of the zone is designed to minimize the impact on other vessels transiting the area.

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 Homeland Security (DHS). This finding is based on the limited size of the safety zone. Because the zone is so small, transiting vessels will be able to transit around the zone, thus it will have minimal, if any, impact on vessels transiting the waters of Peril Strait. Marine information broadcasts will advise mariners of the safety zone and its restrictions.

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 owners or operators of vessels intending to transit in the vicinity of Cozian Reef, some of which may be small entities. This safety zone will not have a significant economic impact on these entities because marine traffic will still be able to transit around the area while operations are ongoing.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we offer to assist small entities in understanding the rule so that they could better evaluate its effects on them and participate in the rulemaking process.

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.

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 analyzed this rule under Commandant Instruction M16475.1D, which guides the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA)(42 U.S.C. 4321-4370f), and have concluded that there are no factors in this case that would limit the use of a categorical exclusion under section 2.B.2 of the Instruction. Therefore, this rule is categorically excluded, under figure 2-1, paragraph (34)(g), of the Instruction, from further environmental documentation. This rule creates no additional vessel traffic and thus imposes no additional burdens on the environment. It simply provides guidelines for vessels transiting in Peril Strait so that vessels may transit safely in the vicinity of the Motor Vessel LeConte. Under figure 2-1, paragraph (34)(g), of the Instruction, an “Environmental Analysis Check List” and a “Categorical Exclusion Determination” are not required for this rule.

We did not publish a notice of proposed rulemaking (NPRM) for this regulation. Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing an NPRM. Additionally, under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register . The exact date of the event was not known with sufficient time to allow for the publication of an NPRM followed by an effective date before the event. In addition, the Coast Guard did not have advance notice of the specific dignitaries that will be attending this event. Any delay in the effective date of the event could pose unnecessary risks to those dignitaries attending the event.

The security zone will encompass the waters of Duluth Harbor, within a 250 yard radius from a fixed point located at 46°46′52″ N, 92°05′47″ W. These coordinates are based upon North American Datum (NAD 1983).

Entry into, transit through, or anchoring within this security zone is prohibited unless authorized by the Captain of the Port Duluth or his designated on-scene representative. The designated on-scene representative will be the Coast Guard Patrol Commander. The Coast Guard Patrol Commander may be contacted via VHF Channel 16.

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 Homeland Security (DHS).

The security zone will only be in effect for a few hours on the day of the event and vessels may easily still transit inside the Duluth Harbor.

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 will affect the following entities: the owners or operators of vessels intending to transit or anchor in this portion of Duluth Harbor from 10 a.m. to 3 p.m. May 27, 2004. This regulation will not have a significant economic impact for the following reasons: The regulation is only in effect for one day of the event. The designated area is being established to allow for maximum use of the waterway for commercial and recreational vessels. The Coast Guard will inform the public that the regulation is in effect via Marine Information Broadcasts.

Under Section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pubic Law 104-121), we offer to assist small entities in understanding the rule so that they can better evaluate its effects on them and participate in the rulemaking process. 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 U.S. 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).

We have analyzed this rule under Executive Order 13132, Federalism, and have determined that this rule does not have implications for federalism under that Order.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) 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 proposed rule would not result in such expenditure, we do discuss the effects of this rule elsewhere in this preamble.

This rule will not affect 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.

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

We have analyzed this rule under Executive Order 13211, Actions Concerning Regulation 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.

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 considered the environmental impact of this rule and concluded that under figure 2-1, paragraph (34)(g), of Commandant Instruction M16475.1C, this rule is categorically excluded from further environmental documentation.

This supplemental information section is organized as follows:

The PSD rules apply to the construction or modification of major sources of air pollution. Indiana has already adopted these rules; therefore, air pollution sources will not be subject to any additional requirements. This rulemaking action merely approves the State rules into the SIP, making them federally enforceable under the Clean Air Act (CAA). Because Indiana has a federally-approved State program, anyone wishing to appeal a PSD permit will continue to do so under the State's environmental appeals process.

1. Submitting CBI. Do not submit this information to EPA through regulations.gov or e-mail. Clearly mark the part or all of the information that you claim to be CBI. For CBI information in a disk or CD ROM that you mail to EPA, mark the outside of the disk or CD ROM as CBI and then identify electronically within the disk or CD ROM the specific information that is claimed as CBI. In addition to one complete version of the comment that includes information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public docket. Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2.

2. Tips for Preparing Your Comments. When submitting comments, remember to:

i. Identify the rulemaking by docket number and other identifying information (subject heading, Federal Register date and page number).

ii. Explain why you agree or disagree; suggest alternatives and substitute language for your requested changes.

iii. Describe any assumptions and provide any technical information and/or data that you used.

iv. If you estimate potential costs or burdens, explain how you arrived at your estimate in sufficient detail to allow for it to be reproduced.

v. Explain your views as clearly as possible and provide specific examples to illustrate your concerns, and suggest alternatives.

vi. Make sure to submit your comments by the comment period deadline identified.

This document approves the SIP revision request submitted by IDEM for changes in its PSD program responsive to EPA conditional approval rulemaking.

On September 30, 1980, EPA delegated to IDEM the authority to implement and enforce the federal PSD program (40 CFR 52.21). On April 11, 2001, IDEM submitted a request to EPA to revise its SIP to incorporate its PSD regulations in place of the federal delegated rules. On February 1, 2002, IDEM submitted to EPA a revised request resolving issues identified by EPA during an informal review. IDEM withdrew its August 11, 2001, request on February 27, 2002. On May 28, 2002, EPA sent a letter to IDEM deeming the February 1, 2002 submittal complete, and initiated processing of the request.

Indiana's February 1, 2002 submission consists of the addition to the SIP of: 326 IAC 2-2, PSD rules; 326 2-1.1-6, public notice; and 326 IAC 2-1.1-8, time periods for determination on permit applications. IDEM previously submitted sections 326 IAC 2-1.1-6 and 326 IAC 2-1.1-8, and, at EPA's request, resubmitted them as part of this SIP submittal request.

On January 15, 2003, EPA published a direct final rule conditionally approving IDEM's February 1, 2002 SIP submittal upon correction of a few minor deficiencies (68 FR 1970). On March 3, 2003 (68 FR 9892), EPA withdrew the direct final rule due to adverse comments, and published a final rule conditionally approving the submittal. On January 16, 2004, IDEM responded to the conditional approval by submitting corrections to the identified deficiencies.

In the January 15, 2003 direct final conditional approval and March 3, 2003 final conditional approval, EPA identified minor discrepancies between the Federal rule requirements (40 CFR part 51, subpart I) and the Indiana SIP that IDEM must correct before EPA could fully approve Indiana's PSD program. The following are changes incorporated by IDEM in its January 16, 2004 submittal and approved by EPA through this rulemaking.

In 326 IAC 2-2-1(y)(5), the words “and this subdivision” were superfluous and were, therefore, removed. In 326 IAC 2-2-1(gg), “U.S. EPA” was replaced with “IDEM.” In 326 2-2-1(x)(E), the phrase “minor new source review regulations approved pursuant to 40 CFR 51.160 through 40 CFR 51.166” was added to a list of regulations exempting the use of an alternative fuel or raw material from the definition of a “major modification.” In 326 IAC 2-2-6(b)(5), the words “whichever is later” were not necessary and, therefore, were removed. The date in 326 IAC 2-2-12, which provides an allowance for sources to request that IDEM rescind requirements in permits, was changed from January 1, 2002 to January 19, 2002. The date was intended to be the effective date of the Indiana PSD rule amendments, but since IDEM did not know at the time of final adoption what the actual effective date of the rule would be, an estimated date of January 1, 2002 was inserted. The actual effective date was January 19, 2002; this date is, therefore, being corrected through this action.

In addition to the changes described above, IDEM has also made a number of smaller revisions to 326 IAC 2-2 in its January 16, 2004 submittal that are more grammatical in nature. EPA believes that these changes do not significantly change the meaning of Indiana's rules and, therefore, approves these smaller changes as submitted.

EPA believes that Indiana's January 16, 2004 submittal adequately addressed issues raised in EPA's January 15, 2003 direct final conditional approval and the March 3, 2003 final conditional approval. In this rulemaking action, EPA is therefore approving the sections of Indiana's rules addressed in the Approvability Analysis above as a revision to the Indiana SIP for PSD.

EPA's approval of Indiana's PSD program does not divest EPA of the duty to continue appropriate oversight to insure that PSD determinations made by Indiana are consistent with the requirements of the CAA, Federal regulations and the SIP.

Today's approval of Indiana's SIP revision submission is limited to existing rules. EPA is taking no position on whether Indiana will need to make changes to its new source review rules to meet any requirements that EPA has or may promulgate as part of its new source review reform.

EPA views the approval of these revision to the Indiana PSD SIP as noncontroversial, and anticipates no adverse comments. However, in a separate document in this Federal Register publication, EPA is proposing approval of the State Plan. Should adverse or critical written comments be filed, EPA will withdraw this direct final rule and address all public comments in a final rule based on the proposed rule published in the proposed rules section of this Federal Register . This approval action will be effective without further notice unless EPA receives relevant adverse written comment by June 21, 2004. Should EPA receive adverse or critical comments, it will publish a final rule informing the public that this action will not take effect. Any parties interested in commenting on this action should do so at this time. If no such comments are received, the public is advised that this action will be effective on July 19, 2004.

Under Executive Order 12866 (58 FR 51735, October 4, 1993), this action is not a “significant regulatory action” and therefore is not subject to review by the Office of Management and Budget.

For this reason, this action is also not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001).

This action merely approves state law as meeting Federal requirements and imposes no additional requirements beyond those imposed by state law. Accordingly, the Administrator certifies that this rule 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 rule approves 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).

This rule also does not have tribal implications because it will 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, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).

This action also does not have Federalism implications because it does 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). This action merely approves a state rule implementing a Federal standard, and does not alter the relationship or the distribution of power and responsibilities established in the Clean Air Act.

This rule also is not subject to Executive Order 13045 “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997), because it is not economically significant.

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTA), 15 U.S.C. 272, requires federal agencies to use technical standards that are developed or adopted by voluntary consensus to carry our policy objectives, so long as such standards are not inconsistent with applicable law or otherwise impracticable. In reviewing program submissions, EPA's role is to approve state choices, provided that they meet the criteria of the Act. Absent a prior existing requirement for the state to use voluntary consensus standards, EPA has no authority to disapprove a program submission for failure to use such standards, and it would thus be inconsistent with applicable law for EPA to use voluntary consensus standards in place of a program submission that otherwise satisfies the provisions of the Act. Therefore, the requirements of section 12(d) of the NTTA 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, and has determined that the rule's requirements do not constitute a taking.

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, EPA 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 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).

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by July 19, 2004. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. ( See section 307(b)(2))

Throughout this document, “we,” “us” and “our” refer to EPA.

Table 1 lists the rules we are approving with the dates that they were adopted by the local air agencies and submitted by the California Air Resources Board (CARB) and the Nevada Department of Conservation and Natural Resources (NDCNR), respectively.

On July 24, 1995, VCAPCD Rule 34 was found to meet the completeness criteria in 40 CFR part 51, appendix V, which must be met before formal EPA review. CCDAQM Section 11 was found to meet the completeness criteria on November 18, 2003.

There are no previous versions of VCAPCD Rule 34 in the California SIP. We approved a version of CCDAQM Section 11 into the Nevada SIP on August 27, 1981. The CCDAQM adopted a revision to the SIP-approved version on October 7, 2003 and the NDCNR submitted the revision to EPA on October 23, 2003.

Section 110(a) of the CAA requires states to submit regulations that control volatile organic compounds, oxides of nitrogen, particulate matter, sulfur dioxide and other air pollutants which harm human health and the environment. These rules were developed as part of the local agencies' programs to control these pollutants.

VCAPCD Rule 34 adopts the CAA Title IV, Acid Rain Program by reference. The Acid Deposition Control program is designed to reduce the effects of acid rain through the reduction of sulfur dioxide (SO 2 ) and nitrogen oxide (NO X ) emissions. Rule 34 accepts delegation of the federal program which is currently being implemented as part of the District's Federal Operating Permit Program. There are no Phase I facilities in Ventura County. There are two sources that qualify as Phase II sources in Ventura County: boilers at the Ormond Beach and Mandalay Generating Stations operated by Southern California Edison Company.

CCDAQM Section 11 lists the National Ambient Air Quality Standards and the State Ambient Air Quality Standards. Section 11 has been revised to include the new 8-hour ozone standard and the particulate matter 2.5 microns (PM-2.5) standard. The standard for ozone is 0.08 parts per million averaged during an 8-hour period. The standard for PM-2.5 is based on an annual arithmetic mean of 15 micrograms per cubic meter and a 24-hour standard of 65 micrograms per cubic meter.

The TSDs have more information about these rules.

VCAPCD Rule 34 adopts the Federal Acid Deposition Control program by reference and CCDAQM Section 11 adopts the National Ambient Air Quality Standards into their regulations. These new rules support emission controls found in other sections of the local agencies' requirements. In combination with the other requirements, these rules must be enforceable (see section 110(a) of the Act) and must not relax existing requirements (see sections 110(l) and 193). EPA policy that we used to help evaluate enforceability requirements consistently includes the Bluebook (“Issues Relating to VOC Regulation Cutpoints, Deficiencies, and Deviations,” EPA, May 25, 1988) and the Little Bluebook (“Guidance Document for Correcting Common VOC & Other Rule Deficiencies,” EPA Region 9, August 21, 2001).

We believe these rules are consistent with the relevant policy and guidance regarding enforceability and SIP relaxations. The TSDs have more information on our evaluation.

As authorized in section 110(k)(3) of the Act, EPA is fully approving the submitted rules because we believe they fulfill all relevant requirements. We do not think anyone will object to this approval, so we are finalizing it without proposing it in advance. However, in the Proposed Rules section of this Federal Register , we are simultaneously proposing approval of the same submitted rules. If we receive adverse comments by June 21, 2004, we will publish a timely withdrawal in the Federal Register to notify the public that the direct final approval will not take effect and we will address the comments in a subsequent final action based on the proposal. If we do not receive timely adverse comments, the direct final approval will be effective without further notice on July 19, 2004. This will incorporate these rules into the federally enforceable SIP.

Under Executive Order 12866 (58 FR 51735, October 4, 1993), this action is not a “significant regulatory action” and therefore is not subject to review by the Office of Management and Budget. For this reason, this action is also not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001). This action merely approves state law as meeting Federal requirements and imposes no additional requirements beyond those imposed by state law. Accordingly, the Administrator certifies that this rule 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 rule approves 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 (Pub. L. 104-4).

This rule also does not have tribal implications because it will 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, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000). This action also does not have Federalism implications because it does 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). This action merely approves a state rule implementing a Federal standard, and does not alter the relationship or the distribution of power and responsibilities established in the Clean Air Act. This rule also is not subject to Executive Order 13045 “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997), because it is not economically significant.

In reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. In this context, in the absence of a prior existing requirement for the State to use voluntary consensus standards (VCS), EPA has no authority to disapprove a SIP submission for failure to use VCS. It would thus be inconsistent with applicable law for EPA, when it reviews a SIP submission, to use VCS in place of a SIP submission that otherwise satisfies the provisions of the Clean Air Act. 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. 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 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).

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by July 19, 2004. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

The EPA Region 6 is publishing this direct final notice of deletion of the Odessa Chromium 2, North and South Plumes, Superfund Site from the NPL.

The EPA identifies sites that appear to present a significant risk to public health or the environment and maintains the NPL as the list of those sites. As described in § 300.425(e)(3) of the NCP, sites deleted from the NPL remain eligible for remedial actions if conditions at a deleted site warrant such action.

Because EPA considers this action to be noncontroversial and routine, EPA is taking it without prior publication of a notice of intent to delete. This action will be effective July 19, 2004, unless EPA receives adverse comments by June 21, 2004, on this notice to delete published in the “Proposed Rules” section of today's Federal Register . If adverse comments are received within the 30-day public comment period on this notice to delete, EPA will publish a timely withdrawal of this direct final notice of deletion before the effective date of the deletion and the deletion will not take effect. The EPA will, as appropriate, prepare a response to comments and continue with the deletion process on the basis of the notice of intent to delete and the comments already received. There will be no additional opportunity to comment.

Section II of this document explains the criteria for deleting sites from the NPL. Section III discusses procedures that EPA is using for this action. Section IV discusses the Odessa Chromium 2, North and South Plumes, Superfund Site and demonstrates how it meets the deletion criteria. Section V discusses EPA's action to delete the Site from the NPL unless adverse comments are received during the public comment period.

Section 300.425(e) of the NCP provides that releases may be deleted from the NPL where no further response is appropriate. In making a determination to delete a release from the NPL, EPA shall consider, in consultation with the State, whether any of the following criteria have been met:

i. Responsible parties or other persons have implemented all appropriate response actions required;

ii. all appropriate Fund-financed (Hazardous Substance Superfund Response Trust Fund) response under CERCLA has been implemented, and no further response action by responsible parties is appropriate; or

iii. the remedial investigation has shown that the release poses no significant threat to public health or the environment and, therefore, the taking of remedial measures is not appropriate.

If new information becomes available which indicates a need for further action, EPA may initiate remedial actions. Whenever there is a significant release from a site deleted from the NPL, the deleted site may be restored to the NPL without application of the hazard ranking system.

The following procedures apply to deletion of OU No. 1 and No. 2:

(1) The EPA consulted with the State of Texas through the Texas Commission on Environmental Quality (TCEQ), on the deletion of the Odessa Chromium 2, North and South Plumes, Superfund Site from the NPL prior to developing this direct final notice of deletion.

(2) The State of Texas through the TCEQ concurred with deletion of OU-1 and OU-2 of the Odessa Chromium 2, North and South Plumes, Superfund Site from the NPL in a letter dated November 19, 2003 (appendix A).

(3) Concurrently with the publication of this direct final notice of deletion, a notice of the availability of the parallel notice of intent to delete published today in the “Proposed Rules” section of the Federal Register is being published in the local newspaper of general circulation at or near the Odessa Chromium 2, North and South Plumes, Superfund Site and is being distributed to appropriate Federal, state, and local government officials and other interested parties; the newspaper notice announces the 30-day public comment period concerning the notice of intent to delete Odessa Chromium 2, North and South Plumes, Superfund Site from the NPL.

(4) The EPA placed copies of documents supporting the deletion of the Odessa Chromium 2, North and South Plumes, Superfund Site in the information repositories identified above.

(5) If adverse comments are received within the 30-day public comment period on this notice or the companion notice of intent to delete also published in today's Federal Register, EPA will publish a timely notice of withdrawal of this direct final notice of deletion before its effective date and will prepare a response to comments and continue with the deletion process on the basis of the notice of intent to delete and the comments already received.

Deletion of a site from the NPL does not itself create, alter, or revoke any individual's rights or obligations. Deletion of a site from the NPL does not in any way alter EPA's right to take enforcement actions, as appropriate. The NPL is designed primarily for informational purposes and to assist EPA management. Section 300.425(e)(3) of the NCP states that the deletion of a site from the NPL does not preclude eligibility for future response actions, should future conditions warrant such actions.

The following information provides EPA's rationale for deleting the Odessa Chromium 2, North and South Plumes, Superfund Site from the NPL.

The Odessa Chromium #2 Site is located and bounded approximately by 57th Street on the north, 50th Street on the south, Andrews Highway on the east, and a line which extends from Arthur Avenue north to 57th Street. Chromium was the contaminant of concern present in soil and ground water at the Site. Other heavy metal contaminants discovered during field investigations were below levels of concern. Apparently the contaminants entered the soil, and ultimately the ground water, from two source locations. One was on the corner of 57th Street and Andrews Highway, the other at 5329 Andrews Highway. The two locations resulted in two plumes of ground water contamination at the Site, known as the North Plume and the South Plumes. The North Plume area is north of 54th Street, and the South Plume area is located south of 54th Street.

The EPA first proposed the Odessa Chromium 2, North and South Plumes, Superfund Site for inclusion on the National Priorities List (NPL) in October 15, 1984, 49 FR 40320, 51 FR 21087. The North and South Plume locations had manufacturing and industrial operations that included the on-site disposal of water containing chromium. The chromium had contaminated drinking water supply wells serving residential, commercial, and industrial properties. The contamination was discovered after residents complained of discolored water. On September 8, 1986, the first Record of Decision (ROD) was signed for Operable Unit I (OU-1), the Alternate Water Supply (AWS). The remedy selected was an extension of the Odessa city water system to include potable water service to these areas.

The design of the AWS system was completed during December 1987, and the alternate water supply contract notice to proceed was issued on May 23, 1988. On November 3, 1988, the construction of 1190 linear feet of eight-inch water mains, 10 fire hydrants, necessary valves and fittings, 125 service taps and 106 meter boxes and meters and service connections was finalized by the City, and inspected and determined to be substantially complete by the EPA and the TCEQ, formerly the Texas Water Commission (TWC) and then the Texas Natural Resource Conservation Commission (TNRCC).

The State of Texas, through the Texas Natural Resource Conservation Commission (TNRCC) entered into a Cooperative Agreement with the EPA on September 26, 1984, to perform a Remedial Investigation (RI) and Feasibility Study (FS). The RI fieldwork (soils, ground water, sediment, and air sampling) began in August 1985 and a draft report was submitted in April 1986.

Further fieldwork (soils sampling) was conducted in November 1986, and a final RI report was accepted by TNRCC and EPA on May 1, 1987. A final draft report addressing comparison of the potential remedial alternatives was submitted in December 1987.

Based on these results, the soil was not the subject of a response action at the Odessa Chromium #2, North and South Plumes, Site: therefore, Operable Unit 2 (OU-2) addressed remediation of the ground water contamination and required additional investigation. The Remedial Investigation and Feasibility Study (RI/FS) for OU-2 characterized the affected ground water for both the North and South Plumes and was also conducted by the TNRCC. The final combined RI and FS were completed on March 18, 1988, and testing conducted during the RI/FS confirmed that total Site chromium concentrations in ground water exceeded 0.05 milligrams per liter (mg/l), the EPA's Maximum Contaminant Level (MCL) for total chromium at the time of the RI/FS investigation.

The land usage in the vicinity of the site was quite different in 1986 than at present. In 1986, there was considerable business activity in the area, with small repair yards and oil industry vehicle and machine support activities. There were also numerous residential mobile homes in the area. All of these activities were supported with water drawn from the Trinity Aquifer by private wells.

During the Remedial Investigation for OU-2, more than 400 wells were identified within a one-half mile radius of the Site, of which more than 300 were sampled and analyzed for total and hexavalent chromium. By 1994, many of the businesses and residents in the vicinity of the Site had left. In addition, the use of many of the private wells has been discontinued. Of the wells sampled, 13 were found to exceed the federally regulated drinking water standard for chromium of 0.05 mg/l. In addition, 12 new wells were installed within the Trinity aquifer and eight wells were installed in the perch zone during the remedial investigation. Of the new monitoring wells, seven contained chromium levels which significantly exceeded the drinking water standard. Contamination levels are highest in the perched zone (9.9 mg/l), and the Trinity aquifer has levels up to 3.3 mg/l. The north and south plumes are separated by 54th Street which is an east-west street in bearing, and the south plume being southward from 54th Street.

A site-specific risk assessment was conducted as part of the RI/FS activities. Chromium concentrations present in Site soil are comprised of trivalent and hexavalent chromium. Trivalent chromium is not carcinogenic; however, hexavalent chromium is considered a carcinogen via the inhalation mode of exposure. Analytical data from the Site indicated the chromium concentrations found in the soil at the Site posed no significant risk to human health or the environment. In addition, extraction procedures leach toxicity test data conducted at the Site validated the contaminated soil resulted in no leachable chromium in excess of the EPA acceptable limit (5mg/l). Therefore, soil remediation was not considered necessary for the protection of human health and the environment.

Results of the risk assessment indicate that remedial action was required to reduce the potential for exposure through the consumption of contaminated ground water. The Agency for Toxic Substances and Disease Registry (ATSDR) supports this interpretation of the risk assessment for OU-2 which is Attachment B to the final ROD.

The ROD for OU-2, Ground Water, was signed on March 18, 1988, and the selected remedy required the following: Extraction of chromium-contaminated ground water from the perched water-bearing zone and the Trinity Aquifer; electrochemical treatment of ground water which exceeds the Primary Drinking Water Standard for chromium; reinjection of the treated ground water into the Trinity Aquifer; and, monitoring the site for a minimum of 30 years.

Remedial Design and Cleanup Activities performed on the plumes were activated by a Remedial Action Plan (RAP) for electrochemical treatment, which was approved by EPA in December of 1991 for both the North and South plumes. However, a potentially responsible party, Sequa Corporation, agreed to perform the remedy for the North Plume. The Consent Decree, which was effective on July 16, 1991, required Sequa Corporation to implement the remedy described in the ROD at the North Plume. On March 25, 1992, Sequa Corporation petitioned EPA to change the ground water treatment from electrochemical to ion exchange, citing lower projected remedial costs and the limited ability of electrochemical treatment to remove chromium present in the ground water in low concentrations.

The EPA issued an Explanation of Significant Differences (ESD) on June 28, 1994, to change the remedy from electrochemical treatment to treatment by ion exchange, subject to successful performance of the new technology.

The EPA issued a second ESD dated October 25, 1999, to permit use of ferrous sulfate treatment on the north and south plume, and a third ESD dated September 10, 2003, to eliminate the extended 30-year monitoring of the Site after completion of the remedial action on both the North and South Plumes.

The State of Texas (TCEQ) concurred with the Record of Decisions for OU-1 on September 8, 1986 and for OU-2 on March 18, 1988. The stated ESDs dated June 28, 1995; October 24, 1999; and September 10, 2003, respectively, had formal written concurrences from both TCEQ and Sequa.

On January 1, 1991, the Primary Drinking Water Standard for chromium changed from 0.05 mg/l to 0.10 mg/l total chromium. The ground water cleanup standard for chromium on the Site was revised accordingly. Despite the change in the drinking water standard, concentrations of chromium in the North and South plumes, still exceeded the MCL of 0.10 mg/l.

As of June 2002, all wells at the Odessa Chromium #2 Site had met the project cleanup goal of remaining below the 0.1 mg/l MCL for total chromium for a period of three consecutive months. The EPA issued an ESD on September 10, 2003, which contained sampling results from more than eight years of quarterly monitoring for both the North Plume and the South Plume. After evaluation of these data, it was determined that the 30-year monitoring period requirement could be discontinued. Because this remedy will not result in hazardous substances, pollutants, or contaminants remaining on-site above levels that allow for unlimited use and unrestricted exposure, Operation and Maintenance activities and five-year reviews are not required for this Site.

Public participation activities have been satisfied as required in CERCLA section 113(k), 42 U.S.C. 9613(k), and CERCLA section 117, 42 U.S.C. 9617. Documents in the Deletion Docket for the Odessa Chromium 2 Site which EPA relied on for recommendation of the deletion from the NPL are available to the public in the information repositories which can be found at the Ector County Library, Odessa, Texas; Permian Basin Regional Planning Commission, Midland International Airport, Midland, Texas; the EPA Region 6 Library in Dallas, Texas; and the TCEQ Library in Austin, Texas.

The EPA, with concurrence of the State of Texas, through the TCEQ, has determined that all appropriate responses under CERCLA have been completed, and that no further response actions, under CERCLA are necessary. Therefore, EPA is deleting the Odessa Chromium 2, North and South Plumes, Superfund Site from the NPL. This deletion includes the deletion of both OU-1 and OU-2 from the NPL.

Because EPA considers this action to be noncontroversial and routine, EPA is taking it without prior publication of a notice of intent to delete. This action will be effective July 19, 2004, unless EPA receives adverse comments by June 21, 2004, on a parallel notice of intent to delete published in the “Proposed Rule” section of today's Federal Register. If adverse comments are received within the 30-day public comment period on the proposal, EPA will publish a timely withdrawal of this direct final notice of deletion before the effective date of the deletion and it will not take effect, and EPA will prepare a response to comments and continue with the deletion process on the basis of the notice of intent to delete and the comments already received. There will be no additional opportunity to comment.

46 App. U.S.C. 1295b(e)(5) states that the Maritime Administrator, relying on a delegation of authority from the Secretary may defer the service obligation of any student graduating from the USMMA for up to two years provided that student is enrolled in an approved course of study.

46 CFR 310.58(g) states that the Maritime Administrator may grant a deferment of a service obligation contract, for up to two years only for graduate students enrolled in a marine or maritime-related graduate course of study approved by the Administrator.

The differences in the terms of 46 App. U.S.C. 1295b(e)(5) and 46 CFR 310.58 may hinder midshipmen with superior credentials from pursuing postgraduate scholarships and fellowships. Specifically, since service obligations may be deferred only if postgraduate course work involves a marine or maritime-related course of study, graduate studies are limited.

The Administrator's discretion to defer the service obligations of USMMA midshipmen recipients of scholarships is not limited by the U.S. Code. Therefore, we are amending 46 CFR 310.58(g) to reflect the terms of 46 App. U.S.C. 1295b(e)(5) so that the amended regulation will not condition the Administrator's ability to defer the service obligations of recipients of scholarships and fellowships of national significance on enrollment in a marine or maritime-related course of study.

This interim final rule is not considered a significant regulatory action under section 3(f) of Executive Order 12866, and therefore, was not reviewed by the Office of Management and Budget. This interim final rule is not likely to result in an annual effect on the economy of $100 million or more. This interim final rule is also not significant under the Regulatory Policies and Procedures of the Department of Transportation (44 FR 11034, February 26, 1979). The costs and overall economic impact of this rulemaking are so minimal that no further analysis is necessary.

The Administrative Procedure Act (5 U.S.C. 553) provides an exception to notice and comment procedures when they are unnecessary or contrary to the public interest. MARAD finds that under 5 U.S.C. 553(b)(3)(B) good cause exists for not providing notice and comment since this interim final rule only expands the subject area of courses of study that may be approved by the Maritime Administrator. Accordingly, opportunity for public comment is unnecessary. However, we are requesting public comment on this interim final rule. Under 5 U.S.C. 553(d)(3), MARAD finds that, for the same reason listed above, good cause exists for making this rule effective less than 30 days after publication in the Federal Register .

We analyzed this interim final rule in accordance with the principles and criteria contained in E.O. 13132 (“Federalism”) and have determined that it does not have sufficient federalism implications to warrant the preparation of a federalism summary impact statement. The regulations have no substantial effects on the States, the current Federal-State relationship, or the current distribution of power and responsibilities among the various local officials. Therefore, consultation with State and local officials was not necessary.

The Maritime Administrator certifies that this interim final rule will not have a significant economic impact on a substantial number of small entities. This interim final rule merely broadens the area of consideration for courses of study that may allow deferred service obligations.

MARAD does not believe that this interim final rule will significantly or uniquely affect the communities of Indian tribal governments when analyzed under the principles and criteria contained in Executive Order 13175 (Consultation and Coordination with Indian Tribal Governments). Therefore, the funding and consultation requirements of this Executive Order do not apply.

We have analyzed this interim final rule for purposes of compliance with the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq. ) and have concluded that under the categorical exclusions provision in section 4.05 of Maritime Administrative Order (MAO) 600-1, “Procedures for Considering Environmental Impacts,” 50 FR 11606 (March 22, 1985), neither the preparation of an Environmental Assessment, an Environmental Impact Statement, nor a Finding of No Significant Impact for this rulemaking is required. This rulemaking has no environmental impact.

This rulemaking contains no new or amended information collection or recordkeeping requirements that have been approved or require approval by the Office of Management and Budget.

This interim final rule will not impose an unfunded mandate under the Unfunded Mandates Reform Act of 1995. It will not result in costs of $100 million or more, in the aggregate, to any of the following: State, local, or Native American tribal governments, or the private sector. This interim final rule is the least burdensome alternative that achieves the objective of U.S. policy.

Anyone is able to search the electronic form of all comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review DOT's complete Privacy Act Statement in the Federal Register published on April 11, 2000 (volume 65, number 70, pages 19477-78), or you may visit http://dms.dot.gov.

Designation of critical habitat provides little additional protection to species. In 30 years of implementing the Endangered Species Act of 1973, as amended (Act), we have found that the designation of statutory critical habitat provides little additional protection to most listed species, while consuming significant amounts of available conservation resources. The present system for designating critical habitat has evolved since its original statutory prescription into a process that provides little real conservation benefit, is driven by litigation and the courts rather than biology, limits our ability to fully evaluate the science involved, consumes enormous agency resources, and imposes huge social and economic costs. We have determined that additional agency discretion would allow our focus to return to those actions that provide the greatest benefit to the species most in need of protection.

While attention to and protection of habitat is paramount to successful conservation actions, we have consistently found that, in most circumstances, the designation of critical habitat is of little additional value for most listed species, yet it consumes large amounts of conservation resources. [Sidle (1987) stated, “Because the ESA can protect species with and without critical habitat designation, critical habitat designation may be redundant to the other consultation requirements of section 7.” Currently, only 445 species or 36 percent of the 1,244 listed species in the U.S. under the jurisdiction of the Service have designated critical habitat. We address the habitat needs of all 1,244 listed species through conservation mechanisms such as listing, section 7 consultations, the section 4 recovery planning process, section 9 protective prohibitions of unauthorized take, section 6 funding to the States, and the section 10 incidental take permit process. We conclude that it is these measures that may make the difference between extinction and survival for many species.

We have been inundated with lawsuits for our failure to designate critical habitat, and we face a growing number of lawsuits challenging critical habitat determinations once they are made. These lawsuits have subjected the Service to an ever-increasing series of court orders and court-approved settlement agreements, compliance with which now consumes nearly the entire listing program budget. This leaves us with little ability to prioritize our activities to direct scarce listing resources to the listing program actions with the most biologically urgent species conservation needs.

The consequence of the critical habitat litigation activity is that limited listing funds are used to defend active lawsuits, to respond to Notices of Intent to sue relative to critical habitat, and to comply with the growing number of adverse court orders. As a result, listing petition responses, our own proposals to list critically imperiled species, and final listing determinations on existing proposals are significantly delayed. Litigation over critical habitat issues for species already listed and receiving the Act's full protection has precluded or delayed many listing actions nationwide.

The accelerated schedules of court ordered designations have left us with almost no ability to provide for adequate public participation or to ensure a defect-free rulemaking process before making decisions on listing and critical habitat proposals due to the risks associated with noncompliance with judicially-imposed deadlines. This, in turn, fosters a second round of litigation in which those who fear adverse impacts from critical habitat designations challenge those designations. The cycle of litigation appears endless, is very expensive, and in the final analysis provides relatively little additional protection to listed species.

The costs resulting from the designation include legal costs, the cost of preparation and publication of the designation, the analysis of the economic effects and the cost of requesting and responding to public comment, and in some cases the costs of compliance with National Environmental Policy Act, all are part of the cost of critical habitat designation. None of these costs result in any benefit to the species that is not already afforded by the protections of the Act enumerated earlier, and they directly reduce the funds available for direct and tangible conservation actions.

Astragalus pycnostachyus var. lanosissimus (Ventura marsh milk-vetch) is an herbaceous perennial in the Pea family (Fabaceae). Little is known of the habitat requirements of this subspecies. The only known population of Astragalus pycnostachyus var. lanosissimus occurs in a sparsely vegetated low area, at an elevation of about 30 feet (ft) (10 meters (m)), on the North Shore at Mandalay site, which was previously used for disposal of petroleum waste products (Impact Sciences, Inc. 1997). Based on existing information from historical collections, the best description we have of its habitat is from Wilken and Wardlaw (2001), who concluded that the subspecies occurs in low-elevation coastal dune-swale areas, where freshwater levels (in the form of saturated soils or groundwater) are high enough to reach the roots of the plants. Sometimes, high groundwater is shown by the presence of water in sloughs or coastal creeks, but more typically evidence for freshwater availability is seen in the presence of native freshwater-dependent plants such as Salix spp. (willows), Typha spp. (cattails), Baccharis salicifolia, and others. The soils associated with Astragalus pycnostachyus var. lanosissimus are well-drained, yet contain a mix of sand and clay. Because of the freshwater influence, the soils do not exhibit a white crust that would indicate saline or alkaline conditions. For additional information on the biology, habitat requirements, and historical collection information of Astragalus pycnostachyus var. lanosissimus, please refer to the proposed critical habitat rule (October 9, 2002; 67 FR 62926).

Due to the combination of poor seedling and young plant survivorship and low seed production, the single naturally occurring population of Astragalus pycnostachyus var. lanosissimus has continued to decline since its rediscovery in 1997 and through the 2001 season (Impacts Sciences 1997, 1998; Wilken and Wardlaw 2001; Dieter Wilken, Santa Barbara Botanic Garden, pers. comm. 2002). The population is able to persist due to having established a seedbank (not all seeds produced in one year will germinate the following year). The hard seed coat may require scarification (scraping or small cuts) that cannot happen within one season, so the seed may survive for one year or more in the soil until the coat can break down or is broken by some mechanical means (Michael Wall, Rancho Santa Ana Botanic Garden, pers. comm. 2000). Also, Wilken and Wardlaw (2001) found that the plants may not become reproductive until more than 18 to 30 months following germination. The implication for Astragalus pycnostachyus var. lanosissimus is that low seed production and, thus, a seedbank deficit, combined with low seedling survival and the mortality of some adult plants, may contribute to the population's decline unless other threats to the plants ( e.g., reduced survivorship of seedlings and adult plants due to snail herbivory) can be addressed.

The single natural population of Astragalus pycnostachyus var. lanosissimus near the city of Oxnard is in a degraded backdune community. From 1955 to 1981, the land on which it occurs (hereafter, North Shore at Mandalay) was used as a disposal site for oilfield wastes (Impact Sciences, Inc. 1998). A development proposal for the site includes remediation of soils contaminated with hydrocarbons, followed by construction of 300 homes and a 6-acre (ac) (2-hectare (ha)) lake on 91 ac (37 ha) of land. The proposed soil remediation would involve excavation and stockpiling of the soils, followed by soil treatment and redistribution of the soils over the site (Impact Sciences, Inc. 1998). In 1998, the City of Oxnard published a Final Environmental Impact Report (FEIR), pursuant to the California Environmental Quality Act, for development of this site (Impact Sciences, Inc. 1998). In a final step, the project was approved by the California Coastal Commission (2002).

Astragalus pycnostachyus var. lanosissimus is State-listed as endangered under the California Endangered Species Act (CESA). CESA prohibits the take of any species listed under CESA, including plants. Section 2081 of CESA allows private landowners to obtain a permit for the incidental take of listed species, including plants, which must include mitigation measures commensurate with the level of take proposed, adequate funding for any mitigation, and assurance that the proposed take would not jeopardize the continued existence of the species. The California Department of Fish and Game (CDFG) concluded that the North Shore at Mandalay project would not have direct effects on the subspecies and that therefore a permit was not required; however, the project would have indirect effects on the plant. The landowner entered into a memorandum of understanding with CDFG in order to provide some conservation benefit to the subspecies. The proposed conservation measures for Astragalus pycnostachyus var. lanosissimus on the site would be to establish a 1.65-ac (0.67-ha) “milk-vetch preservation area” encompassing the entire natural population (California Coastal Commission 2002). The milk-vetch preservation area would be buffered from soil remediation activities by a 100-foot (ft) (30 meters (m)) limit line within which no excavation would occur. The milk-vetch preservation area would ultimately be inside a 23.8-ac (9.6-ha) resource protection area (RPA).

According to a comprehensive review of rare plant preserve design compiled by the Conservation Biology Institute (2000), areas to protect a rare plant species should be at a minimum 300 ft (91 m) wide but a larger area is preferred, because effects ( e.g., fuel management, loss of pollinators, introduction of competing exotic plants) are not absorbed by smaller areas, and the effects are likely to extend well into adjacent preserved areas.

The efforts to conserve Astragalus pycnostachyus var. lanosissimus on the North Shore site are much improved over earlier concepts, and we appreciate the efforts of the landowner. However, the Service believes, based on the published literature, that the configuration of the preserve is not suitable for buffering the plants from adjacent land uses. Although the RPA is 23.8 acres and one contiguous area, the Astragalus pycnostachyus var. lanosissimus population is near the edge of the RPA, where it would be adjacent to residential development, and the majority of the natural vegetation in the vicinity to the Astragalus pycnostachyus var. lanosissimus population would be removed. Although no measurements of buffer size were available, and maps we received were not to scale and not overly clear, it appears that the majority of the RPA is to the south of the Astragalus pycnostachyus var. lanosissimus preserve and thus does not provide sufficient buffering ( i.e. , at least 300 feet) from adjacent residential development and roads. Furthermore, at least 50 feet of the RPA, including the buffer area surrounding the milk-vetch preserve, will be landscaped, and not natural vegetation, thus further affecting hydrology, pollinators, and potentially introducing non-native species to the preserve. Also, the RPA was not intended to provide protection solely for the Astragalus pycnostachyus var. lanosissimus population, and as such, much of the 23.8 acre area (approximately 30 percent by our estimate) encompasses habitat which would not support Astragalus pycnostachyus var. lanosissimus ( e.g. , willow riparian habitat along the Edison Canal). Lastly, the soil remediation the developer has agreed to provide, which will take place to within 100 feet of the Astragalus pycnostachyus var. lanosissimus preserve, will alter the local hydrology upon which the plant relies. We are uncertain if the local hydrology can or will be restored following soil remediation. The RPA is likely to become dominated by non-native plants, and the replacement soil may contain seeds of plant species which will invade the Astragalus pycnostachyus var. lanosissimus preserve. We have not seen a restoration plan that establishes that the area would be replanted with native plants.

We were not involved in the agreements between the developer and local and State officials because our regulatory authority does not extend to listed plants on private land unless there is a Federal nexus, such as a Federal permit or funding. No nexus was involved at this site, and our role was strictly advisory. However, if a landowner takes a State-listed species in violation of CESA, and the species is also federally listed, the take would also violate section 9 of the Act.

A sooty fungus was found on the leaves of Astragalus pycnostachyus var. lanosissimus in late summer 1997, as leaves began to wither or senesce (die) and the plants entered a period of dormancy (Impact Sciences, Inc. 1997). The effects of the fungus on the population are not known, but it is possible that the fungus attacks senescing leaves in great number only at the end of the growing season. The plants appeared robust when in flower in June 1997 and matured seed by October 1997, at which point the fungus was noted. The plants were regrowing in March 1998, after a period of dormancy, without obvious signs of the fungus (Diane Steeck, Service, in litt. 1998). Wilken and Wardlaw's 2001 study did not detect any signs of pathogens on mature plants that appeared to be in poor health; however, two mature plants had infestations of aphids (Family: Aphididae) that were being tended by nonnative Argentine ants ( Linepithema humile ). Wilken (2002) reported finding cucumber mosaic virus, which is transmitted by aphids, in the Astragalus pycnostachyus var. lanosissimus population.

In 1997, the seeds of Astragalus pycnostachyus var. lanosissimus were heavily infested with seed beetles (Family Bruchidae: Coleoptera). In a seed collection done for conservation purposes in 1997, we found that most fruits partially developed at least four seeds; however, seed predation reduced the average number of undamaged seeds to only 1.8 per fruit (D. Steeck, in litt. 1998). Wilken and Wardlaw (2001) reported similar findings in 2000. Apparently heavy seed predation by seed beetles and weevils has been reported among other members of the genus Astragalus (Platt et al. 1974; Lesica 1995). Wilken and Wardlaw (2001) estimate that seed predation by these insects may reduce seed viability by 30 percent in a given year.

Because of its small population size, the only known natural population is also threatened by competition with nonnative plant species. Cortaderia selloana (pampas grass), Carpobrotus sp., and Bromus madritensis ssp. rubens are invasive nonnative plant species that occur at the site (Impact Sciences, Inc. 1997). Carpobrotus sp., in particular, is a competitive, succulent species with the potential to cover vast areas in dense clonal mats and may harbor nonnative snails. Bromus madritensis ssp. rubens grew in high densities around some mature individuals of Astragalus pycnostachyus var. lanosissimus in 1998, and seedlings were germinating among patches of Carpobrotus sp. and Bromus spp. in 1998 (D. Steeck, in litt. 1998). Seedling survival rates for Astragalus pycnostachyus var. lanosissimus in these areas have not been determined.

Efforts to conserve Astragalus pycnostachyus var. lanosissimus have been initiated by the landowner (North Shore at Mandalay LLC), a task force of scientists from the University of California, the Santa Barbara Botanic Garden, California Department of Fish and Game (CDFG), the Service, and the Rancho Santa Ana Botanic Garden (RSABG). Consulting biologists for the landowner and proponents of the development have successfully grown plants in a remote greenhouse facility. Several plants were excavated from the natural population and potted prior to State and Federal listing, and other plants were started from seed gathered from the natural population. In addition, Astragalus pycnostachyus var. lanosissimus seed from the site was placed in a seed storage collection and a seed bulking project at RSABG. RSABG has been successful in germinating Astragalus pycnostachyus var. lanosissimus seed and growing the plants in containers (Wilken and Wardlaw 2001).

Research populations have been introduced in two locations within the historical range of Astragalus pycnostachyus var. lanosissimus : One at Mandalay State Beach, across the street from the extant population, and the other at McGrath State Beach. A further research population is present outside of the known range of the subspecies, at Carpinteria Marsh in Santa Barbara County. In addition, approximately 250 individuals were planted and are being irrigated at the Coal Oil Point Reserve, also in Santa Barbara County. Seed has been introduced at 10 separate dune locations at the Reserve (Cristina Sandoval, Coal Oil Point Reserve Director, pers. comm. 2002). The data gathered from these efforts will be used in establishing self-sustaining populations of Astragalus pycnostachyus var. lanosissimus . The plants at Coal Oil Point have been established primarily for the purpose of generating seeds (“bulking up seed”) to increase the seedbank in storage, and not necessarily for generating data on establishing new populations.

In 1997, the population of Astragalus pycnostachyus var. lanosissimus at the North Shore at Mandalay consisted of about 374 plants, of which 260 were small plants thought to have germinated in the last year, and 114 were “adult” plants. Fewer than 65 of the adult plants produced fruit in 1997 (Impact Sciences, Inc. 1997). In 1998, 192 plants were counted during surveys of the population. Service biologists placed cages around a sample of plants in 1999 to protect them from severe herbivory by small mammals, most likely brush rabbits. Despite this protection, only 30 to 40 plants produced flowers in 1999, which was believed to be less than half of those blooming in 1998 (D. Steeck, in litt. 1998). It is not known why flowering was so low in 1999.

The total number of adult plants in the natural population declined between 1997 and 2000 (Wilken and Wardlaw 2001). Although 46 of 80 seedlings that germinated in the 2000 growing season were still present in October 2000, the total number of surviving adult plants in 2000 was estimated at 39. Many are believed to have succumbed to herbivory from snails and brush rabbits (Wilken and Wardlaw 2001). Following efforts to control snails in 2000 ( i.e. , poisoning, hand removal, clearing of iceplant, fencing), and perhaps more favorable growing conditions in the winter of 2000-01, more than 1,000 seedlings were observed (D. Wilken, pers. comm. 2002). Of these, more than 300 survived until October 2001, when they became dormant, indicating an increase in the number of plants in the natural population.

A census of the natural population on September 15, 2002, revealed that 37 reproductive plants had survived from the seedlings present in 2001, and 38 reproductive plants remained from seedlings established in 2000 or earlier, for a total of 75 reproductive plants in 2002. Approximately 350 plants had germinated in 2002. The total number of surviving plants was not determined. Some mortality is expected among all age classes in the following years depending upon rainfall and other factors.

As of June 2003, the status of the research populations at McGrath State Beach, Carpinteria Marsh Reserve, and Mandalay State Beach (CDFG, in litt. 2003a), was as follows (the Coal Oil Point population is excluded because it is not part of the research, as described earlier):

(1) McGrath State Beach. In April 2002, 167 plants were planted at McGrath State Beach. As of February 2003, 88 percent (147) of the plants had survived, and most were still alive in June 2003. Three sites at McGrath had produced a total of 236 seedlings.

(2) Carpinteria Marsh Reserve. In April 2002, 155 plants were planted. As of February 2003, 44 percent (68) of the plants survived. Only 20 seedlings had been produced by plants at one of the planting sites as of June 2003.

(3) Mandalay State Beach. On February 23, 2003, 57 Astragalus pycnostachyus var. lanosissimus plants in one-gallon containers were planted. All plants had survived as of June 2003.

The most recent census data we have includes information from the experimental populations at McGrath State Beach and Carpinteria Marsh Reserve gathered over the summer of 2003 (CDFG, in litt. 2003b). Of the five experimental plots at McGrath State Beach, the plants at two plots had died out, and plants at the remaining three plots were vigorous, with a total of 79 plants surviving out of 167 that were alive during the previous census. Of the five plots started at Carpinteria Marsh, only two still supported plants, with a total of 30 plants surviving out of 155 planted (19 percent). At McGrath State Beach, the losses and successes were attributed to moisture availability ( i.e. , plants died where the roots were not able to reach freshwater, but did well where freshwater was available). At Carpinteria, the losses were attributed to high salinity and gopher foraging (CDFG, in litt. 2003b).

On October 9, 2002, we published the proposed critical habitat designation for Astragalus pycnostachyus var. lanosissimus (67 FR 62926) in compliance with the August 2, 2001, stipulated settlement agreement and order. In that proposed rule, we included a detailed summary of the previous Federal actions completed prior to publication of the proposal. We re-opened the public comment period to seek comments on the draft economic analysis on March 20, 2003 (68 FR 13663). Due to funding shortfalls for critical habitat work in FY 2003, we were unable to complete the final rule by the stipulated date of October 1, 2003. On September 29, 2003, the court granted the Service's motion to modify the August 2, 2001 Stipulated Settlement Agreement and Order and extended the date for publication of the final rule to May 15, 2004 ( Center for Biological Diversity v. United States Fish and Wildlife Service, C 01-0352 SI (N.D. Cal.)).

We solicited comments from appropriate Federal, State, and local agencies, the scientific community, and other interested parties. We invited public comment through notification sent to local newspapers in Ventura and Santa Barbara Counties. Additionally, we invited public comment on the proposed critical habitat designation on October 9, 2002 (67 FR 62926), and again on March 20, 2003, when we published the draft economic analysis and re-opened the comment period on the critical habitat proposal (68 FR 13663).

We received three comment letters on the proposed critical habitat designation. All three were reviewed for substantive issues and new information regarding critical habitat. One of the commentors was against the designation on the single piece of privately-owned land included in the proposal. The other two commentors were neutral but provided some new information and clarification on the subspecies' natural history and status.

In accordance with our policy published on July 1, 1994 (59 FR 34270), we solicited the expert opinions of six independent specialists regarding this rule. The purpose of such review is to ensure listing decisions are based on scientifically sound data, assumptions, and analyses. We sent these peer reviewers copies of the proposed rule immediately following publication in the Federal Register . Two of the peer reviewers responded, providing comments that we have incorporated into the final rule.

(1) Comment: One comment stated that a critical habitat designation could add nothing to the multiple protections already in place for Astragalus pycnostachyus var. lanosissimus at the North Shore site, which supports the only natural population of the subspecies and warrants exclusion under section 4(b)(2) of the Act. The comment further states that similar exemptions have been granted to military installations.

Our Response: The comment's rationale for exclusion of the North Shore at Mandalay site from the critical habitat designation, citing that it is similar to exclusions we have granted under section 4(b)(2) for military installations, is not accurate. Where we have excluded a military installation from a critical habitat designation pursuant to section 4(b)(2), we determined that the benefits of excluding lands under the jurisdiction of the U.S. military outweigh the benefits of including them as critical habitat, and would not result in the extinction of the species.

As stated previously, this site supports the only naturally-occurring population. While there are other locations where the subspecies has been planted, these remain under study and it is not clear at this time how or whether they will contribute to the survival of the species. This site is the only seed source, has provided all of the initial propagules for establishing research populations of the species at other sites, and continues to be the source of genetic variability for future propagation. The research populations at McGrath State Beach, Carpinteria Marsh, and Mandalay State Beach are not intended to become new populations for the recovery of the species, but were established to generate data on the species' needs when such introductions for recovery begin. Their persistence is uncertain, and we have observed some failures (see Background section). Consequently, the population of Astragalus pycnostachyus var . lanosissimus on the North Shore at Mandalay site is currently the only one of which we can be relatively certain that the plants will persist. If this population is extirpated, and the research populations ultimately fail, all of the remaining individuals of Astragalus pycnostachyus var. lanosissimus will exist as seeds in collections or propagated in greenhouses. The designation of the North Shore at Mandalay site as critical habitat recognizes that this population is essential to the species' conservation. This southernmost unit is geographically separated from other critical habitat within its historical range. This will reduce the likelihood of all populations being destroyed by one naturally occurring catastrophic event.

(2) Comment: One comment stated that the proposed rule was based upon the wrong legal standard for determining critical habitat. Critical habitat is to be narrowly drawn.

Our Response: The critical habitat units as proposed meet the definition of critical habitat in the Act. The occupied areas designated are essential to the conservation of the species and may require special management. In addition, we have made the finding that the unoccupied areas are essential to the conservation of the species. The North Shore at Mandalay site, for which the comment seeks exclusion, supports the only naturally-occurring population of Astragalus pycnostachyus var. lanosissimus in existence. The plants on this site are the source of all genetic variation available to the subspecies, and its survival is dependent upon a diverse genetic base that can respond to environmental fluctuations and disease.

The designation includes the site of the one existing population and sufficient area to establish new populations necessary for survival and recovery of Astragalus pycnostachyus var. lanosissimus .

(3) Comment: One comment stated that the proposed rule was not specific enough to identify properties or whether they contained primary constituent elements, and, therefore, did not allow for comments on specific parcels.

Our Response: We disagree that the proposed rule did not adequately identify locations of critical habitat. The proposed rule provided maps and Universal Transverse Mercator (UTM) coordinates of the proposed critical habitat units. The UTM coordinates are typically used in Global Positioning System (GPS) data and are at a scale of 3.3 ft (1 m), which is of sufficient detail for locating the extent and configuration of the units, and should allow most property owners to determine if their property is within the boundaries of critical habitat. Detailed maps of the designation are available on our web site, and property owners may call our office for further assistance if necessary.

(4) Comment: One comment asserted that the proposed rule failed to include an economic analysis as required under the Act.

Our Response: We conducted an economic analysis as required by the Act. The draft economic analysis was made available for public review on March 20, 2003 (68 FR 13663), and we accepted public comments on it from March 20, 2003, until April 21, 2003. We did not receive any comments on the draft economic analysis. The final economic analysis is part of the administrative record for this rulemaking.

(5) Comment: One comment stated that the Service cannot designate critical habitat for the milk-vetch until it first complies with the requirements of the National Environmental Policy Act. The comment cites Catron County Board of Commissioners v. U.S. Fish and Wildlife Service (1996) to support its contention.

Our Response: As we indicated in our proposed rule, we have determined that an Environmental Assessment or an Environmental Impact Statement, as defined under the authority of the National Environmental Policy Act of 1969, need not be prepared in connection with regulations adopted pursuant to section 4(a) of the Act. A notice outlining our reason for this determination was published in the Federal Register on October 25, 1983 (48 FR 49244). This position has been upheld by the Ninth Circuit Court of Appeals in Douglas County v. Babbitt , 48 F.3d 1495 (9th Cir. 1995).

Also, the public involvement and notification requirements under both the Endangered Species Act and the Administrative Procedure Act provide ample opportunity for public involvement in the process, similar to the opportunities for public involvement and economic analysis of effects that would be provided in the NEPA process.

(6) Comment: One comment recommended that we avoid making conclusions about the success of efforts to establish Astragalus pycnostachyus var. lanosissimus at Carpinteria Marsh until the population proves to be self-sustaining, which could take 3 to 4 years.

Our Response: We recognize that the efforts to establish Astragalus pycnostachyus var. lanosissimus at Carpinteria Marsh were preliminary at the time the proposed rule was published. More recent data has been incorporated into this final rule that shows limited success with the experimental population due to physical ( e.g. , salinity) and biological factors ( e.g. , competition from nonnative plants).

(7) Comment: Two comments stated that a research population had not been initiated at Mandalay State Beach, despite our contention to that effect in the proposal.

Our Response: At the time the critical habitat proposal was published, the comments are correct that the research population had not yet been initiated; however, the CDFG has now implemented an experimental population at Mandalay State Beach in addition to those at McGrath State Beach, Carpinteria Marsh, and Coal Oil Point. The CDFG planted 57 1-gallon specimens of Astragalus pycnostachyus var. lanosissimus at Mandalay State Beach in February 2003. The status of this outplanting is described in the background section of this final rule.

(8) Comment: One comment stated that the plants at Coal Oil Point are an in-ground nursery and not intended to become a self-sustaining population.

Our Response: The intent of the Coal Oil Point experiment was not clear to us at the time the critical habitat proposal was published. From discussions with the science task force, we now recognize that the population is meant to provide propagules (cuttings or seed) for other populations.

(9) Comment: One comment expressed concern that critical habitat designations on land within the University of California's Natural Reserve System could cause regulatory delays for federally funded research projects on these lands.

Our Response: We did not receive any comments from representatives of the University of California's Natural Reserve System (Reserve) objecting to the proposed designation. We understand that one of the purposes of the Reserve system is conservation of plants and animals, such as Astragalus pycnostachyus var. lanosissimus, so the critical habitat designation is consistent with that goal. Federal funding of research projects at Carpinteria Marsh could trigger consultation under section 7 of the Act if the research project would adversely affect designated critical habitat for Astragalus pycnostachyus var. lanosissimus. However, we have concluded that these consultations would not cause undue delays in initiating research projects. Compliance with section 7 could range from simple concurrence, which is usually completed within 30 days, to formal consultation, which could take 135 days or less. Formal consultation on critical habitat would only be necessary if the action would have an adverse effect on the critical habitat. We anticipate that most research within the Reserve would be designed not to adversely affect the primary constituent elements of the critical habitat of Astragalus pycnostachyus var. lanosissimus.

(10) Comment: Two comments noted that the Wilken and Wardlaw (2001) report was not intended to represent a comprehensive analysis of all potential sites for introduction of Astragalus pycnostachyus var. lanosissimus, and that areas to the south of Ventura County within the historical range of Astragalus pycnostachyus var. lanosissimus should have been included.

Our Response: While Wilken and Wardlaw (2001) was not intended to be an exhaustive analysis of all potential sites for introduction of Astragalus pycnostachyus var. lanosissimus at the time critical habitat was proposed, it was, and remains, the best scientific information available to support the designations. Our designation is to be based on the best available scientific data. We do not have similar data for all other potential introduction sites, so we did not attempt to include areas for which we did not have data indicating that the location was essential to the conservation of Astragalus pycnostachyus var. lanosissimus. Based on museum records, we know that Astragalus pycnostachyus var. lanosissimus was once known from Los Angeles and Orange Counties. In preparation of the proposed rule, we interviewed biologists familiar with the coastal wetlands in Los Angeles and Orange Counties, and specifically, historical locations at the Ballona Wetlands and Bolsa Chica. The information they provided led us to conclude that opportunities for introductions of Astragalus pycnostachyus var. lanosissimus were incompatible with current conditions and future restoration efforts. We agree that the areas to the south within the historical range of Astragalus pycnostachyus var. lanosissimus are worth exploring for recovery efforts; however, the information we had at the time critical habitat units were identified did not support inclusion of sites in Los Angeles and Orange Counties.

(11) Comment: One comment asked why land at the Navy Base Ventura County was excluded from the designation when Wilken and Wardlaw (2001) included it, and why the Ormond Beach area was not included.

Our Response: Based upon Wilken and Wardlaw's (2001) research, we considered a site at the Navy Base Ventura County, Point Mugu for inclusion as critical habitat. Point Mugu Naval Air Weapons Station, in southern Ventura County, may have suitable habitat (Wilken and Wardlaw 2001). A. pycnostachyus var. lanosissimus was not found during cursory surveys of the base, nor has this taxon ever been collected there despite habitat evaluations and vegetation sampling by the Navy for the past 15 years (Navy Base Ventura County 2002). Further, our criteria for including sites required more than just suitable habitat. We designated areas with primary constituent elements, where the existing population occurs and those where research populations have been established. Nevertheless, we intend to continue to work with the Navy to develop an introduction and conservation plan for Astragalus pycnostachyus var. lanosissimus at the Navy Base Ventura.

For the Ormond Beach area, we did not have sufficient information at the time critical habitat for Astragalus pycnostachyus var. lanosissimus was proposed to warrant its inclusion. As stated above, we did not attempt to include areas for which we did not have data indicating that the location was essential to the conservation of Astragalus pycnostachyus var. lanosissimus .

(12) Comment: One comment stated that gophers ( Thomomys bottae ) are a continuing threat to the plants at some of the sites where Astragalus pycnostachyus var. lanosissimus has been introduced, but not at the native population site where buried oil sludge may deter gophers. Further, the comment notes that the nonnative Melilotus indicus is a competitor for the likely pollinator of Astragalus pycnostachyus var. lanosissimus where the two plants occur together.

Our Response: We recognize that current and new threats to Astragalus pycnostachyus var. lanosissimus exist; however, this new information does not affect the critical habitat designation at this time. We will consider this information and incorporate this data into the recovery efforts currently under way for Astragalus pycnostachyus var. lanosissimus.

Based upon our review of the public comments, peer review responses, and the economic analysis, we reevaluated our critical habitat and made changes as necessary. Although some pertinent information on the background of the subspecies was provided by reviewers, we did not receive new information that would warrant changes to the boundaries of critical habitat as proposed. We did incorporate changes to the information on Astragalus pycnostachyus var. lanosissimus which include the following:

(1) We updated the status of the natural and research populations. These changes are generally the result of more recent counts of the numbers of individual plants. Where available, we included new data on factors affecting the plants' growth and development.

(2) Information on participants in the science task force overseeing current experiments with Astragalus pycnostachyus var. lanosissimus has been revised.

(3) We updated information on experiments being conducted at Mandalay State Beach, which we erroneously described in the proposed rule.

(4) We updated the description of a proposed development on the North Shore at Mandalay site that supports the only natural population of Astragalus pycnostachyus var. lanosissimus.

(5) We provided a summary of the Economic Analysis that has been adopted as final for this rule.

Critical habitat is defined in section 3 of the Act as—(i) the specific areas within the geographic area occupied by a species, at the time it is listed in accordance with the Act, on which are found those physical or biological features (I) essential to the conservation of the species and (II) that may require special management considerations or protection; and (ii) specific areas outside the geographic area occupied by a species at the time it is listed, upon a determination that such areas are essential for the conservation of the species. “Conservation” means the use of all methods and procedures that are necessary to bring an endangered or a threatened species to the point at which listing under the Act is no longer necessary.

The designation of critical habitat does not affect land ownership or establish a refuge, wilderness, reserve, preserve, or other conservation area. It does not allow government or public access to private lands. Under section 7 of the Act, Federal agencies must consult with us on activities they undertake, fund, or permit that may affect critical habitat and lead to its destruction or adverse modification. However, the Act prohibits unauthorized take of listed species and requires consultation for activities that may affect them, including habitat alterations, regardless of whether critical habitat has been designated.

To be included in a critical habitat designation, habitat must be either a specific area within the geographic area occupied by the species on which are found those physical or biological features essential to the conservation of the species (primary constituent elements, as defined at 50 CFR 424.12(b)) and which may require special management considerations or protections, or be specific areas outside of the geographic area occupied by the species which are determined to be essential to the conservation of the species. Section 3(5)(C) of the Act states that critical habitat shall not include the entire geographical area which can be occupied by a species unless the Secretary determines that circumstances require such designation. Our regulations (50 CFR 424.12(e)) also state that, “The Secretary shall designate as critical habitat areas outside the geographic area presently occupied by the species only when a designation limited to its present range would be inadequate to ensure the conservation of the species.” Accordingly, when the best available scientific and commercial data do not demonstrate that the conservation needs of the species require designation of critical habitat outside of occupied areas, we will not designate critical habitat in areas outside the geographic area occupied by the species. Within the geographic area occupied by Astragalus pycnostachyus var. lanosissimus , we will designate only areas currently known to be essential. Essential areas should already have the features and habitat characteristics that are necessary to sustain Astragalus pycnostachyus var. lanosissimus . We will not speculate about what areas might be found to be essential if better information became available, or what areas may become essential over time. We have also excluded from this proposal, areas of suitable habitat where they might potentially occur, and some localities where they historically occurred.

To be included in a critical habitat designation, the Service must also find that habitat may require special management considerations or protections. As discussed in more detail below, with respect to the individual units, the Service finds that the three units designated as critical habitat for Astragalus pycnostachyus var. lanosissimus may require special management considerations or protections due to threats to the species and/or its habitat. Such special management considerations or protections may include management of invasive, non-native plants; reducing or eliminating herbivory by snails and rabbits; and reducing or eliminating the indirect effects of development, as well as protecting the composition of native plant and animal communities within critical habitat units.

Section 4(b)(2) of the Act requires that we take into consideration the economics, and any other relevant impact, of specifying any particular area as critical habitat. We may exclude areas from critical habitat designation when the benefits of exclusion outweigh the benefits of including the areas within critical habitat, provided the exclusion will not result in extinction of the species.

Our Policy on Information Standards under the Endangered Species Act, published in the Federal Register on July 1, 1994 (59 FR 34271), provides criteria, establishes procedures, and provides guidance to ensure that our decisions represent the best scientific and commercial data available. It requires our biologists, to the extent consistent with the Act and with the use of the best scientific and commercial data available, to use primary and original sources of information as the basis for recommendations to designate critical habitat. When determining which areas are critical habitats, a primary source of information should be the listing package for the species. Additional information may be obtained from a recovery plan, articles in peer-reviewed journals, conservation plans developed by states and counties, scientific status surveys and studies, biological assessments, or other unpublished materials.

Section 4 of the Act requires that we designate critical habitat based on what we know at the time of designation. Habitat is often dynamic, and species may move from one area to another over time. Furthermore, we recognize that designation of critical habitat may not include all of the habitat areas that may eventually be determined to be necessary for the conservation of the species. For these reasons, critical habitat designations do not signal that habitat outside the designation is unimportant or may not be required for recovery.

Areas that support populations, but are outside the critical habitat designation, will continue to be subject to conservation actions implemented under section 7(a)(1) of the Act and to the regulatory protections afforded by the section 7(a)(2) jeopardy standard and the section 9(a)(2) prohibitions, as determined on the basis of the best available information at the time of the action. Federally funded or permitted projects affecting listed species outside their designated critical habitat areas may still result in jeopardy findings in some cases. Similarly, critical habitat designations made on the basis of the best available information at the time of designation will not control the direction and substance of future recovery plans, HCPs, or other species conservation planning efforts if new information available to these planning efforts calls for a different outcome.

As required by section 4(b)(2) of the Act and regulations at 50 CFR 424.12, we used the best scientific information available to determine areas that contain the physical and biological features that are essential for the conservation of Astragalus pycnostachyus var. lanosissimus. This information included data from the final rule listing the species as endangered (66 FR 27901), the California Natural Diversity Data Base (CNDDB) (CDFG 2002), recent biological surveys, reports and aerial photos, additional information provided by interested parties, and discussions with botanical experts. We also conducted site visits to locations managed by Federal and State agencies, including NBVC, McGrath State Beach, and Carpinteria Marsh.

Much of our understanding of the habitat requirements of Astragalus pycnostachyus var. lanosissimus is derived from Wilken and Wardlaw (2001), which represents the most complete information to date regarding the biology and habitat of the species. Of particular relevance to this critical habitat determination, Wilken and Wardlaw (2001) provide descriptions of the habitat of Astragalus pycnostachyus var. lanosissimus ' closest relative, Astragalus pycnostachyus var. pycnostachyus (northern marsh milk-vetch). Wilken and Wardlaw (2001) collected data on habitat characteristics at sites occupied by Astragalus pycnostachyus var. pycnostachyus and compared these with the characteristics at the extant population of Astragalus pycnostachyus var. lanosissimus. Once common habitat characteristics had been established, Wilken and Wardlaw used these to evaluate areas for their suitability for establishing new populations of Astragalus pycnostachyus var. lanosissimus. The factors evaluated included: degree of disturbance; vegetative cover (percent and type); associated species; proximity to subterranean water table; and potential threats. Wilken and Wardlaw (2001) also analyzed soil from the site where Astragalus pycnostachyus var. lanosissimus currently exists for physical and chemical properties important for general plant growth, such as texture, pH, salinity, nutrients, and micronutrients.

Determining what constitutes habitat for Astragalus pycnostachyus var. lanosissimus is difficult because there is only one extant population, and the site has been altered by soil dumping and oil waste disposal. Also, the historical collections did not fully document the habitat where the plants were found. Therefore, both Wilken and Wardlaw (2001) and the Service's data (D. Steeck, in litt. 1998) were used to characterize the habitat of Astragalus pycnostachyus var. lanosissimus and to determine the primary constituent elements. Some differences between the two subspecies of Astragalus pycnostachyus are apparent, especially in regard to associated plant species and general habitat type. For example, some individuals of Astragalus pycnostachyus var. pycnostachyus are found in habitats similar to Astragalus pycnostachyus var. lanosissimus , but individuals are also found some distance from wet habitats in relatively dry or gravelly soils. Such differences may be a function of a small data set for Astragalus pycnostachyus var. lanosissimus due to its single population, uncertainty surrounding its presence on the extant site ( i.e. , whether it is a natural occurrence or was introduced through soil dumping), and differences in habitat needs of the two subspecies. We have paid particular attention to information from Wilken and Wardlaw (2001) because they analyzed conditions at the only known site where Astragalus pycnostachyus var. lanosissimus currently occurs.

In accordance with section 3(5)(A)(i) of the Act and regulations at 50 CFR 424.12, in determining which areas to designate as critical habitat, we consider those physical and biological features (primary constituent elements) that are essential to the conservation of the species and that may require special management considerations or protection. These include, but are not limited to: space for individual and population growth, and for normal behavior; food, water, air, light, minerals or other nutritional or physiological requirements; cover or shelter; sites for reproduction, germination, or seed dispersal; and habitats that are protected from disturbance or are representative of the known historical, geographical, and ecological distributions of a species.

Much of what is known about the specific physical and biological requirements of Astragalus pycnostachyus var. lanosissimus is described in the Background section of this final rule. The designated critical habitat is designed to provide sufficient habitat to maintain self-sustaining populations of Astragalus pycnostachyus var. lanosissimus throughout its range, and to provide those components essential for the conservation of the subspecies. These habitat components provide for: (1) Individual and population growth, including sites for germination, pollination, reproduction, pollen and seed dispersal, and seed dormancy; and (2) areas that provide basic requirements for growth, such as water, light, and minerals.

We have concluded that the long-term success of the conservation of Astragalus pycnostachyus var. lanosissimus is dependent upon the protection of the existing population site and sites where introductions can be conducted, as well as the maintenance of ecological functions within these sites, including connectivity between colonies ( i.e. , groups of plants within sites) within close geographic proximity to facilitate pollinator activity and seed dispersal. The areas we are designating as critical habitat provide some or all of the habitat components essential for the conservation of Astragalus pycnostachyus var. lanosissimus. Based on the best available information from the only extant site of the species, the primary constituent elements of critical habitat for Astragalus pycnostachyus var. lanosissimus. consist of, but are not limited to:

(1) Vegetation cover of at least 50 percent but not exceeding 75 percent, consisting primarily of known associated native species, including but not limited to, Baccharis salicifolia, Baccharis pilularis, Salix lasiolepis, Lotus scoparius (deerweed), and Ericameria ericoides (coast goldenbush);

(2) Low densities of nonnative annual plants and shrubs;

(3) The presence of a high water table, either fresh or brackish, as evidenced by the presence of channels, sloughs, or depressions that may support stands of Salix lasiolepis, Typha spp., and Scirpus spp. (cattail);

(4) Soils that are fine-grained, composed primarily of sand with some clay and silt, yet are well-drained; and

(5) Soils that do not exhibit a white crystalline crust that would indicate saline or alkaline conditions.

Critical habitat designated for Astragalus pycnostachyus var. lanosissimus includes the only known location where the subspecies currently occurs and two other sites with high potential to support the subspecies based upon habitat and/or historical occurrences. We have concluded that establishment of new, self-sustaining populations of Astragalus pycnostachyus var. lanosissimus at other sites is essential for the subspecies' survival because it is currently known from a single location where its future is uncertain due to its small population size, and the high degree of threat from chance catastrophic events. Catastrophic events are a concern when the number of populations or geographic distribution of a species is severely limited (Shaffer 1981, 1987; Meffe and Carroll 1997; Primack 1998), as is the case with Astragalus pycnostachyus var. lanosissimus. Because a critical habitat designation limited to this subspecies' present range, which is one known location, would be inadequate to ensure its conservation, the establishment of additional locations for Astragalus pycnostachyus var. lanosissimus is critical to reducing the risk of extinction.

For sites not currently occupied by Astragalus pycnostachyus var. lanosissimus , we first considered the historical range of the subspecies based upon collection data and records from the CNDDB (CDFG 2001). From this potential distribution, we located areas where the plants were observed or collected in the past.

By examining aerial photographs and reviewing pertinent literature, and through discussions with botanical experts, we identified areas where the primary constituent elements exist. These broader areas were refined with information on the extant population and the other locations as derived from Wilken and Wardlaw (2001). We also engaged in discussions, by phone and electronic mail, with the Carlsbad Fish and Wildlife Office, which has responsibility for and experience with, the historical locations in southern Los Angeles and Orange Counties (K. Clark, Service, pers. comm. 2002; J. Fancher, Service, pers. comm. 2002).

We identified the boundaries of the units on aerial photographs and U.S. Geological Survey topographical maps and refined them based upon adjacent land uses. For example, one unit is bordered on three sides by urban areas and on the other side by the Pacific Ocean. The critical habitat units were designed to encompass a large enough area to support existing ecological processes that may be essential to the conservation of Astragalus pycnostachyus var. lanosissimus ( i.e. , that provide areas for population expansion, provide connectivity or linkage between colonies within a unit, and support populations of pollinators and seed dispersal organisms).

Within the historical range of Astragalus pycnostachyus var. lanosissimus , we considered two of the collection localities: Bolsa Chica, Orange County, and the Ballona Wetlands, Los Angeles County. During discussions with biologists most familiar with these areas (K. Clark, pers. comm. 2002; J. Fancher, pers. comm. 2002), we concluded that, although the areas remain undeveloped for the most part, conditions have changed dramatically since the plants were collected. For example, the Bolsa Chica area has been altered by oil development, which created raised pads and lower excavated areas, and channelized the natural freshwater inflow that once existed. The influence of tidal flow is now more pronounced, to the point that the soils have become saline. The area, also, does not contain plant species that indicate freshwater influence. Plant species indicating freshwater influence are found at the currently occupied site and at locations where the close relative, Astragalus pycnostachyus var. pycnostachyus , occurs. Also, long-range plans for Bolsa Chica would increase the tidal influence by establishing a direct connection to the ocean across Bolsa Chica State Beach. The Ballona Wetlands are similarly isolated from a freshwater source and are subject to considerable disturbance from human activities. Consequently, we rejected both Bolsa Chica and the Ballona Wetlands as potential reintroduction sites for Astragalus pycnostachyus var. lanosissimus and as critical habitat units.

For critical habitat outside of the historical range, we considered areas from Gaviota State Beach, Santa Barbara County, south to San Diego County. We have included only one critical habitat unit (Carpinteria Marsh) that could be considered outside of the known range of the subspecies in this critical habitat designation. That location is included because of its proximity to the historical distribution and the presence of primary constituent elements. Data to support designation of critical habitat elsewhere outside the historic range of Astragalus pycnostachyus var. lanosissimus are limited. In addition, introducing Astragalus pycnostachyus var. lanosissimus in the vicinity of Astragalus pycnostachyus var. pycnostachyus is not prudent because of the potential for hybridization and dilution of genetic identity between the two varieties. Therefore, we did not consider other locations outside the historical range of Astragalus pycnostachyus var. lanosissimus.

In designating critical habitat, we made an effort to avoid developed areas, such as housing developments, that are unlikely to contain the primary constituent elements for Astragalus pycnostachyus var. lanosissimus. However, we did not map critical habitat at a small enough scale to all for the exclusion of all lands unlikely to contain the primary constituent elements essential for the conservation of Astragalus pycnostachyus var. lanosissimus. Areas within the boundaries of the mapped units such as buildings, roads, parking lots, railroads, airport runways and other paved areas, lawns, and other urban landscaped areas will not contain any of the primary constituent elements. Federal actions limited to these areas, therefore, would not trigger a section 7 consultation, unless they affect the species and/or primary constituent elements in adjacent critical habitat.

In summary, we selected critical habitat areas that provide for the conservation of Astragalus pycnostachyus var. lanosissimus where it is known to occur, as well as areas essential for establishment of new populations in order for the species to be conserved. As noted above, establishment of new populations is important to reduce the risk of extirpation from chance catastrophic events.

When designating critical habitat, we assess whether the areas determined to be essential for the conservation of the species may require special management or protections. The Mandalay Unit may require special management considerations or protections due to the threats to the species and its habitat posed by development ( e.g., loss of native vegetation, disruption of pollinator community, herbivory by snails, increase in non-native plants, soil remediation), herbivory by rabbits, and trampling as a result of human activity. Currently, competition by non-native plants, herbivory by snails and rabbits, and human activity are ongoing in the Mandalay Unit. The McGrath Unit may require special management considerations or protections due to the threats to the species and its habitat posed by invasive, non-native plants and trampling as a result of human activity. Currently, competition from non-native plants and human activity are ongoing in the McGrath Unit. The Carpinteria Salt Marsh Unit may require special management considerations or protections due to the threats to the species and its habitat posed by non-native plants and high salinity. Currently, competition from non-native plants and fluctuations in salinity levels are ongoing in the Carpinteria Salt Marsh Unit.

The critical habitat areas described below constitute our best assessment at this time of the areas essential for the conservation of Astragalus pycnostachyus var. lanosissimus. The areas designated as critical habitat are: (1) Mandalay, including the site of the extant population at Fifth Street and Harbor Boulevard in the city of Oxnard, Ventura County; (2) McGrath Lake area, McGrath State Beach, California Department of Parks and Recreation (CDPR), Ventura County, and (3) Carpinteria Salt Marsh Reserve run by the University of California, Santa Barbara, (UC Santa Barbara) Santa Barbara County.

The only site occupied by a natural population of Astragalus pycnostachyus var. lanosissimus is in the Mandalay Unit in the city of Oxnard. A research population has been initiated at the Mandalay State Beach portion of the unit. Research introductions have also occurred at the Carpinteria Salt Marsh Reserve and McGrath State Beach units. Research populations may be present in some of the units; however, these are not considered self-sustaining populations as they require continued monitoring and control. Therefore, we consider all of the units unoccupied except for the Mandalay Unit where the natural population occurs. We find that unoccupied areas are essential to the conservation of the species because the single extant natural population is likely to be affected by direct and indirect impacts of the approved development of the North Shore at Mandalay project ( i.e., due to inadequate preserve design). Furthermore, a catastrophic event could eliminate the population regardless of the development. In the absence of suitable off-site locations where the subspecies could be established, it is possible that it could go extinct. The two unoccupied sites we have included have been identified through research as the most likely candidates for new populations because the primary constituent elements are present and they can be adequately protected from the threats identified earlier. One site is within the historical range of the subspecies and one is not.

Our evaluation of Astragalus pycnostachyus var. lanosissimus has shown that suitable habitat areas are scarce within the historical range of the subspecies. The combination of associated plant species, high groundwater, low salinity, and other primary constituent elements has either been removed or disrupted by urbanization, agriculture, oilfield development, or flood control projects. Other areas within the historical range were considered and rejected, and areas outside of the historical range were limited in scope and only one was included. The scarcity of suitable habitat has also contributed to the need to designate areas currently unoccupied by Astragalus pycnostachyus var. lanosissimus as critical habitat. We have therefore concluded that the designation of currently unoccupied locations as critical habitat is essential to the conservation of Astragalus pycnostachyus var. lanosissimus.

In summary, we have designated approximately 420 ac (170 ha) of land in three units as critical habitat for Astragalus pycnostachyus var. lanosissimus. The approximate areas of designated critical habitat by land ownership are shown in Table 1. Private lands comprise approximately 33 percent of the designated critical habitat; and State lands comprise 67 percent. No Federal lands are included in the designation.

The three critical habitat units include the only known location where the subspecies currently occurs and two unoccupied sites that contain the primary constituent elements. A brief description of each critical habitat unit is given below.

The Mandalay Unit is approximately 153 ac (62 ha) in size and is essential to the conservation of Astragalus pycnostachyus var. lanosissimus because it contains the only known location where Astragalus pycnostachyus var. lanosissimus naturally exists and the remainder of the unit also supports the primary constituent elements. The State-owned Mandalay State Beach is managed by the Ventura County Parks and Recreation Department and comprises about 49 ac (20 ha) of this unit. The remaining area of the unit is privately owned and is currently undeveloped, but has been chosen as the site for a 300-housing-unit subdivision (Economic and Planning Systems, Inc. 2003).

The pending development is called North Shore at Mandalay and would occur in the eastern portion of this critical habitat unit. The project includes a 1.65-ac (0.67-ha) “milk-vetch preservation area” encompassing the entire natural population (California Coastal Commission 2002), which in turn, would be inside a 23.8-ac (9.6-ha) resource protection area (RPA). The RPA would be buffered from adjacent residential development by a 50-ft (15 m) wide landscaped area. The population will be mostly isolated from surrounding vegetation, and the ecological processes sustaining the population may be interrupted. Also, the project may allow increased human intrusion, provide habitat for nonnative plants and snails, alter the hydrologic regime, and introduce pesticides and fertilizers that adversely affect the plants. Therefore, the risk of extinction of the subspecies is high without the development of additional populations.

The portion of this unit on Mandalay State Beach is identified by Wilken and Wardlaw (2001) as a possible site for establishing a new population of Astragalus pycnostachyus var. lanosissimus. In 2003, the first efforts at researching how new populations could be established in this unit were begun. The proximity of Mandalay State Beach to the extant population indicates that some natural exchange of seeds or pollen could take place if a second population were established at Mandalay State Beach. The site contains one or more of the primary constituent elements defined for Astragalus pycnostachyus var. lanosissimus critical habitat, although Wilken and Wardlaw (2001) note some dense cover of nonnative annuals. Also, using their five parameters, Wilken and Wardlaw (2001) ranked the Mandalay State Beach portion of this unit as one of the most similar to the natural occurrences of Astragalus pycnostachyus var. lanosissimus and the closely related Astragalus pycnostachyus var. pycnostachyus, and hence one of the top candidates for establishing a new population.

California Department of Parks and Recreation (CDPR) has approved experimental introductions of Astragalus pycnostachyus var. lanosissimus conducted by the CDFG. Because the area is public land owned by the CDPR and the species is State-listed, we will work with the State to develop conservation strategies to reintroduce the subspecies and develop and manage reserves.

As discussed above, this unit is essential for the conservation of Astragalus pycnostachyus var. lanosissimus because it contains the primary constituent elements for Astragalus pycnostachyus var. lanosissimus. The population of Astragalus pycnostachyus var. lanosissimus at the North Shore at Mandalay site is the only naturally-occurring, self-perpetuating population of the species in existence. It has provided all of the initial propagules for establishing research populations of the species at other sites, and continues to be the source of genetic variability for future propagation. The research populations at McGrath State Beach and Carpinteria Marsh are not intended to become new populations for the recovery of the species, but were established to generate data on the species' needs when such introductions for recovery begin. Their persistence is uncertain, and we have observed some failures (see Background section). Consequently, the population of Astragalus pycnostachyus var. lanosissimus on the North Shore at Mandalay site is currently the only one of which we can be relatively certain that the plants will persist. If this population is extirpated, and the research populations ultimately fail, all of the remaining individuals of Astragalus pycnostachyus var. lanosissimus will exist as seeds in collections or propagated in greenhouses. The designation of the North Shore at Mandalay site as critical habitat recognizes that this population is essential to the species' conservation. This southernmost unit is geographically separated from other critical habitat within its historical range. This will reduce the likelihood of all populations being destroyed by one naturally occurring catastrophic event.

The site within McGrath Beach State Park is adjacent to McGrath Lake on the leeward side of the southern end of the lake, between the lake and Harbor Boulevard. The unit covers 62 ac (25 ha). It includes 35 ac (14 ha) of private land and 27 ac (11 ha) of State-owned land managed by CDPR.

Of the sites they examined, Wilken and Wardlaw (2001) identify the McGrath Lake area as having the best combination of habitat characteristics similar to that of the extant population of Astragalus pycnostachyus var. lanosissimus and its closest relative, Astragalus pycnostachyus var. pycnostachyus based upon five parameters ( i.e. , dominant vegetation composed of a shrub canopy less than 75 percent; absence of competitive annual or perennial exotic plants; water table in close proximity; soil types consistent with that at the site of the extant population; and native habitat supporting pollinators).

CDPR agreed to allow CDFG and RSABG establish a research population on this site. This effort is still in its early stages, and no conclusive data have yet been retrieved. Because the area is currently operated by CDPR and is public land, there is opportunity to work with the State to develop reintroduction strategies for Astragalus pycnostachyus var. lanosissimus and to form manageable reserves. This unit is also one of the last known places where the subspecies was observed growing naturally, and it is close to the extant population and shares many of the broader climatic and habitat features of that site.

As discussed above, this unit is essential for the conservation of Astragalus pycnostachyus var. lanosissimus because it once supported a population Astragalus pycnostachyus var. lanosissimus until it was extirpated in 1967. It contains the primary constituent elements for Astragalus pycnostachyus var. lanosissimus. It includes habitat that is necessary for the expansion of the only known population, which may become nonviable in the future. It contains habitat features that are essential for this species including, but not limited to, high diversity of native plants, open canopy, sandy dune hollows, seep margin areas, subterranean water table. This central unit is geographically separated from other critical habitat within Astragalus pycnostachyus var. lanosissimus historical range. This will reduce the likelihood of all populations being destroyed by one naturally occurring catastrophic event.

The Carpinteria Salt Marsh Unit extends from the Southern Pacific Railroad tracks south and west to Sand Point Drive and Santa Monica Creek and is approximately 205 ac (83 ha) in size. The entire unit is managed by the UC, Santa Barbara.

This unit includes saltmarsh habitat, which is essential to support the pollinators and other ecological processes that Astragalus pycnostachyus var. lanosissimus requires for its survival. The research population of Astragalus pycnostachyus var. lanosissimus was introduced in April 2002 into a portion of the unit. As of February 2003, 44 percent (68) of the 155 original plants survived. By June 2003, only 20 seedlings had been produced by plants at one of the planting sites. We have determined that this area contains the primary constituent elements necessary for the introduction of Astragalus pycnostachyus var. lanosissimus based on Wilken and Wardlaw's (2001) description of five parameters of habitat suitability. These parameters closely parallel the primary constituent elements, so one or more of the elements are represented at this site. The diverse native vegetation provides for a robust pollinator community. The unit is bordered by a residential community where nonnative snails were observed; protection is required for herbivory by snails on Astragalus pycnostachyus var. lanosissimus plants.

This site in Santa Barbara County is near the range of the subspecies as predicted by the historical collections and described by Skinner and Pavlik (1994), who list the known counties as Ventura, Los Angeles, and Orange. We have included this unit because, although it is outside the historical range for Astragalus pycnostachyus var. lanosissimus: (1) Insufficient suitable habitat for the subspecies remains within its historical range; and (2) the area has habitat features essential to the conservation of the subspecies, which suggests a high potential for successful establishment of a new population (Wilken and Wardlaw 2001). This unit is essential for the conservation of Astragalus pycnostachyus var. lanosissimus because it supports the pollinators and other ecological processes for Astragalus pycnostachyus var. lanosissimus. It contains habitat features that are essential for this species including, but not limited to, dominant vegetation composed of a shrub canopy less than 75 percent; absence of competitive annual or perennial exotic plants; water table in close proximity; soil type; and native habitat supporting pollinators. Seedling recruitment has been observed at this site in the research population. This northernmost unit is geographically separated from other critical habitat. This will reduce the likelihood of all populations being destroyed by one naturally occurring catastrophic event.

Section 7(a) of the Act requires Federal agencies, including the Service, to ensure that actions they fund, authorize, permit, or carry out do not destroy or adversely modify critical habitat. In our regulations at 50 CFR 402.02, we define destruction or adverse modification as “a direct or indirect alteration that appreciably diminishes the value of critical habitat for both the survival and recovery of a listed species. Such alterations include, but are not limited to: Alterations adversely modifying any of those physical or biological features that were the basis for determining the habitat to be critical.” However, in a March 15, 2001, decision of the United States Court of Appeals for the Fifth Circuit ( Sierra Club v. U.S. Fish and Wildlife Service et al. , 245 F.3d 434), the court found our definition of destruction or adverse modification to be invalid. In response to this decision, we are reviewing the regulatory definition of adverse modification in relation to the conservation of the species.

Section 7(a) of the Act requires Federal agencies, including the Service, to evaluate their actions with respect to any species that is proposed or listed as endangered or threatened, and with respect to its critical habitat, if any is proposed or designated. Regulations implementing this interagency cooperation provision of the Act are codified at 50 CFR part 402. Section 7(a)(4) of the Act requires Federal agencies to confer with us on any action that is likely to jeopardize the continued existence of a species proposed for listing or result in destruction or adverse modification of proposed critical habitat. Conference reports provide conservation recommendations to assist the agency in eliminating conflicts that may be caused by the proposed action. The conservation recommendations in a conference report are advisory.

We may issue a formal conference report if requested by a Federal agency. Formal conference reports include an opinion that is prepared according to 50 CFR 402.14, as if the species was listed or critical habitat designated. We may adopt the formal conference report as the biological opinion when the species is listed or critical habitat designated, if no substantial new information or changes in the action alter the content of the opinion (50 CFR 402.10(d)).

If a species is listed or critical habitat is designated, section 7(a)(2) of the Act requires Federal agencies to ensure that activities they authorize, fund, or carry out are not likely to jeopardize the continued existence of such a species or to destroy or adversely modify its critical habitat. If a Federal action may affect a listed species or its critical habitat, the responsible Federal agency (action agency) must enter into consultation with us. Through this consultation, we would ensure that the permitted actions do not destroy or adversely modify critical habitat.

If we issue a biological opinion concluding that a project is likely to result in the destruction or adverse modification of critical habitat, we also provide “reasonable and prudent alternatives” to the project, if any are identifiable. Reasonable and prudent alternatives are defined at 50 CFR 402.02 as alternative actions identified during consultation that can be implemented in a manner consistent with the intended purpose of the action, that are consistent with the scope of the Federal agency's legal authority and jurisdiction, that are economically and technologically feasible, and that the Director believes would avoid destruction or adverse modification of critical habitat. Reasonable and prudent alternatives can vary from slight project modifications to extensive redesign or relocation of the project.

Regulations at 50 CFR 402.16 require Federal agencies to reinitiate consultation on previously reviewed actions under certain circumstances, including instances where critical habitat is subsequently designated and the Federal agency has retained discretionary involvement or control over the action or such discretionary involvement or control is authorized by law. Consequently, some Federal agencies may request reinitiation of consultation or conference with us on actions for which formal consultation has been completed, if those actions may affect designated critical habitat, or adversely modify or destroy proposed critical habitat.

Activities on Federal lands that may affect Astragalus pycnostachyus var. lanosissimus or its critical habitat will require section 7 consultation. Activities on private or State lands requiring a permit from a Federal agency, such as a permit from the U.S. Army Corps of Engineers (Corps) under section 404 of the Clean Water Act, a section 10(a)(1)(B) permit from the Service, or some other Federal action, including funding ( e.g. , Federal Highway Administration, Environmental Protection Agency (EPA), or Federal Emergency Management Authority funding), would also be subject to the section 7 consultation process. Federal actions not affecting listed species or critical habitat and actions on non-Federal and private lands that are not federally funded, authorized, or permitted do not require section 7 consultation.

Section 4(b)(8) of the Act requires us to evaluate briefly and describe, in any proposed or final regulation that designates critical habitat, those activities involving a Federal action that may adversely modify such habitat or that may be affected by such designation. Activities that may destroy or adversely modify critical habitat would be those that alter the primary constituent elements to the extent that the value of critical habitat for the conservation of the subspecies is appreciably reduced. We note that such activities may also jeopardize the continued existence of the subspecies.

Activities that, when carried out, funded, or authorized by a Federal agency, may affect critical habitat and require that a section 7 consultation be conducted include, but are not limited to, the following:

(1) Alteration of existing hydrology by lowering the groundwater table through surface changes or pumping of groundwater, or redirection of freshwater sources through diverting surface waters ( e.g. , channelization);

(2) Compaction of soil through the establishment of trails or roads;

(3) Placement of structures or hardscape ( e.g. , pavement, concrete, nonnative rock or gravel);

(4) Removal of native vegetation that reduces native plant cover to below 50 percent;

(5) Introduction of nonnative vegetation or creation of conditions that encourage the growth of nonnatives, such as irrigation, landscaping, soil disturbance, addition of nutrients, etc.;

(6) Use of pesticides or other chemicals that can directly affect Astragalus pycnostachyus var. lanosissimus, its associated native vegetation, or pollinators;

(7) Introduction of nonnative snails or Argentine ants or creation of conditions favorable to these species. Such conditions arise as a result of landscaping with nonnative groundcover plants, irrigation, or other activities that increase moisture and food availability for these nonnative species that have been detrimental to the existing population;

(8) Activities that isolate the plants or their populations from neighboring vegetation or reduce the size of natural open spaces, and thus interfere with ecological processes that rely upon connectivity with adjacent habitat, such as maintaining pollinator populations and seed dispersal; and

(9) Soil disturbance that damages or interferes with the seedbank of the subspecies, such as discing, tilling, grading, removal, or stockpiling.

We recognize that designation of critical habitat may not include all of the habitat areas that may eventually be determined to be necessary for the recovery of the species. Critical habitat designations do not signal that habitat outside the designation is unimportant or not required for recovery. Areas outside the critical habitat designation will continue to be subject to conservation actions that may be implemented under section 7(a)(1) of the Act and to the regulatory protections afforded by the section 7(a)(2) jeopardy standard and the applicable prohibitions of section 9 of the Act, as determined on the basis of the best available information at the time of the action.

Several other species that are listed under the Act have been documented to occur in the same general areas as the current distribution of Astragalus pycnostachyus var. lanosissimus. These include: brown pelican ( Pelecanus occidentalis ); western snowy plover ( Charadrius alexandrinus nivosus ); California least tern ( Sterna antillarum browni ); light-footed clapper rail ( Rallus longirostris levipes ); and salt marsh bird's beak ( Cordylanthus maritimus ssp. maritimus ).

If you have questions regarding whether specific activities will likely constitute adverse modification of critical habitat, contact the Field Supervisor, Ventura Fish and Wildlife Office (see FOR FURTHER INFORMATION CONTACT section). Requests for copies of the regulations on listed wildlife and inquiries about prohibitions and permits may be addressed to the U.S. Fish and Wildlife Service, Portland Regional Office, 911 NE 11th Avenue, Portland, OR 97232-4181 (503/231-6131; facsimile 503/231-6243).

Currently, no HCPs exist that include Astragalus pycnostachyus var. lanosissimus as a covered species.

Following the publication of the proposed critical habitat designation on October 9, 2002, a draft economic analysis was prepared to estimate the potential direct and indirect economic impacts associated with the designation, in accordance with the recent decision in N.M. Cattlegrowers Ass'n v. U.S. Fish and Wildlife Serv., 248 F.3d 1277 (10th Cir. 2001) (Economic and Planning Systems 2003). The draft analysis was made available for public review and comment on March 20, 2003 (68 FR 13663), and we accepted comments on the draft analysis until April 21, 2003.

Our draft economic analysis evaluated the potential direct and indirect economic impacts associated with the proposed critical habitat designation for Astragalus pycnostachyus var. lanosissimus over the next 10 years. Direct impacts are those related to consultations under section 7 of the Act. They include the cost of completing the section 7 consultation process and potential project modifications resulting from the consultation. Indirect impacts are secondary costs and benefits not directly related to operation of the Act. Examples of indirect impacts include potential effects to property values, redistricting of land from agricultural or urban to conservation, and social welfare benefits of ecological improvements.

The categories of potential direct and indirect costs and benefits considered in the analysis included the costs associated with: (1) Conducting section 7 consultations, including incremental consultations and technical assistance; (2) modifications to projects, activities, or land uses resulting from the section 7 consultations; (3) uncertainty and public perceptions resulting from the designation of critical habitat including potential effects on property values and the interaction of State and local laws; and (4) potential offsetting beneficial costs associated with critical habitat, including educational benefits. The most likely economic effects of critical habitat designation are on activities funded, authorized, or carried out by a Federal agency ( i.e. , direct costs).

Following the close of the comment period on the draft economic analysis, an addendum was completed. We received no comments on the draft economic analysis. The draft economic analysis and addendum addressed the impact of the proposed critical habitat designation that may be attributable coextensively to the listing of the subspecies. Because of the uncertainty about the benefits and economic costs resulting solely from critical habitat designations, we believe that it is reasonable to estimate the economic impacts of a designation utilizing this single baseline. It is important to note that the inclusion of impacts attributable coextensively to the listing does not convert the economic analysis into a tool to be used in deciding whether or not a species should be added to the Federal list of threatened and endangered species.

The critical habitat designations for Astragalus pycnostachyus var. lanosissimus include State and private lands only. No Federal lands are involved. The estimates for section 7 consultation in the economic analysis were based upon activities that are “reasonably foreseeable,” which is defined as the time period from the present and for the next 10 years. Beyond 10 years, the numbers of projects and the potential for section 7 consultations become increasingly speculative.

Together, the draft economic analysis and the addendum constitute our final economic analysis. The final economic analysis estimates that over the next 10 years, the designation (co-extensive with the listing) will likely not result in section 7 consultations in any of the designated three units. Therefore, costs associated with section 7 implementation are anticipated to be $0. Similarly, the benefits of designation, which may include educational benefits that are difficult to quantify, are also limited. The cleanup of the Mandalay unit will be conducted by the developer and overseen by the Los Angeles Water Quality Control Board. There might have been a Federal nexus had the EPA overseen or funded the cleanup. However, the EPA has determined that the State's provision over the site cleanup was sufficient, and therefore, there will not be a Federal nexus (Economic and Planning Systems, Inc. 2003).

A copy of the final economic analysis and supporting documents are included in our administrative record and may be obtained by contacting our Ventura Fish and Wildlife Office (see ADDRESSES section).

In accordance with Executive Order 12866, the Office of Management and Budget (OMB) has determined that this critical habitat designation is not a significant regulatory action. This rule will not have an annual economic effect of $100 million or more or adversely affect any economic sector, productivity, competition, jobs, the environment, or other units of government. This designation will not create inconsistencies with other agencies' actions or otherwise interfere with an action taken or planned by another agency. It will not materially affect entitlements, grants, user fees, loan programs, or the rights and obligations of their recipients. Finally, this designation will not raise novel legal or policy issues. Accordingly, OMB has not formally reviewed this final critical habitat designation.

Under the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. , as amended by the Small Business Regulatory Enforcement Fairness Act (SBREFA) of 1996), whenever an agency is required to publish a notice of rulemaking for any proposed or final rule, it must prepare and make available for public comment a regulatory flexibility analysis that describes the effects of the rule on small entities ( i.e. , small businesses, small organizations, and small government jurisdictions). However, no regulatory flexibility analysis is required if the head of the agency certifies the rule will not have a significant economic impact on a substantial number of small entities. SBREFA amended the RFA to require Federal agencies to provide a statement of the factual basis for certifying that a rule will not have a significant economic effect on a substantial number of small entities. SBREFA also amended the RFA to require a certification statement.

According to the Small Business Administration, small entities include small organizations, such as independent non-profit organizations, and small governmental jurisdictions, including school boards and city and town governments that serve fewer than 50,000 residents, as well as small businesses (13 CFR 121 and http://www.sba.gov/size/ ). Small businesses include manufacturing and mining concerns with fewer than 500 employees, wholesale trade entities with fewer than 100 employees, retail and service businesses with less than $5 million in annual sales, general and heavy construction businesses with less than $27.5 million in annual business, special trade contractors doing less than $11.5 million in annual business, and agricultural businesses with annual sales less than $750,000. To determine if potential economic impacts to these small entities are significant, we consider the types of activities that might trigger regulatory impacts under this rule as well as the types of project modifications that may result.

SBREFA does not explicitly define either “substantial number” or “significant economic impact.” Consequently, to assess whether a “substantial number” of small entities is affected by this designation, this analysis considers the relative number of small entities likely to be impacted in the area. Similarly, this analysis considers the relative cost of compliance on the revenues/profit margins of small entities in determining whether or not entities incur a “significant economic impact.” Only small entities that are expected to be directly affected by the designation are considered in this portion of the analysis. This approach is consistent with several judicial opinions related to the scope of the RFA ( Mid-Tex Electric Co-Op, Inc. v. F.E.R.C. and American Trucking Associations, Inc. v. EPA ).

To determine if the rule would affect a substantial number of small entities, we considered the number of small entities affected within particular types of economic activities ( e.g. , housing development, grazing, oil and gas production, timber harvesting). We applied the “substantial number” test individually to each industry to determine if certification is appropriate. In estimating the numbers of small entities potentially affected, we also considered whether their activities have any Federal involvement; some kinds of activities are unlikely to have any Federal involvement and so will not be affected by critical habitat designation. The final economic analysis found that the designation of critical habitat will not affect a single entity, and therefore, the designation will not result in a significant economic impact on a substantial number of small entities.

Designation of critical habitat only affects activities conducted, funded, or permitted by Federal agencies; non-Federal activities are not affected by the designation if they lack a Federal nexus. In areas where the subspecies is present, Federal agencies funding, permitting, or implementing activities are already required to avoid jeopardizing the continued existence of Astragalus pycnostachyus var. lanosissimus through consultation with us under section 7 of the Act. Following finalization of this critical habitat designation, Federal agencies must also ensure that their activities do not destroy or adversely modify designated critical habitat through consultation with us. However, this will not result in any additional regulatory burden on Federal agencies or their applicants where the subspecies is present because conservation already would be required due to the presence of a listed species.

In unoccupied areas, or areas of uncertain occupancy, designation of critical habitat could trigger additional review of Federal activities under section 7 of the Act, and may result in additional requirements on Federal activities to avoid destroying or adversely modifying critical habitat. Astragalus pycnostachyus var. lanosissimus has only been listed since June 2001, and no formal consultations involving the subspecies have taken place. Therefore, for the purposes of this review and certification under the RFA, we are assuming that any future consultations in the areas proposed for critical habitat that are considered unoccupied will be due to the critical habitat designation. Should a federally funded, permitted, or implemented project be proposed that may affect designated critical habitat, we will work with the Federal action agency and any applicant, through section 7 consultation, to identify ways to implement the proposed project while minimizing or avoiding any adverse effect to the subspecies or critical habitat. In our experience, the vast majority of such projects can be successfully implemented with at most minor changes that avoid significant economic impacts to project proponents.

Based on our experience with section 7 consultations for all listed species, virtually all projects—including those that, in their initial proposed form, would result in jeopardy or adverse modification determinations in section 7 consultations—can be implemented successfully with, at most, the adoption of reasonable and prudent alternatives. These measures, by definition, must be economically feasible and within the scope of authority of the Federal agency involved in the consultation. As we have no consultation history for Astragalus pycnostachyus var. lanosissimus, we can only describe the general kinds of actions that may be identified in future reasonable and prudent alternatives. These are based on our understanding of the needs of the subspecies and the threats it faces, especially as described in the final listing rule and in this final critical habitat designation, as well as our experience with similar listed plants in California. In addition, the State of California listed Astragalus pycnostachyus var. lanosissimus as an endangered species under the California Endangered Species Act of 1978, and we have also considered the kinds of actions required through State regulations for this subspecies. The kinds of actions that may be included in future reasonable and prudent alternatives include conservation set-asides, management of competing nonnative species, restoration of degraded habitat, construction of protective fencing, and regular monitoring. These measures are not likely to result in a significant economic impact to project proponents.

As required under section 4(b)(2) of the Act, we have conducted an analysis of the potential economic impacts and benefits of this critical habitat designation, and made that analysis available for public review and comment before finalizing this designation. Based upon the economic analysis, we conclude that the economic effects of the final rule for Astragalus pycnostachyus var. lanosissimus will be less than those identified for other California plant critical habitat designations because the amount of private land involved is limited, and the plant occurs naturally in only one of the units. Further, no Federal nexus exists for a proposed development on the private land within the designated critical habitat. The designation of critical habitat in areas not occupied by A. pycnostachyus var. lanosissimus could result in extra costs involved with consultations that may not have occurred were it not for the designations. However, one unit is entirely State-owned and the burden of consultation should not cause economic hardship on private entities.

Efforts to establish Astragalus pycnostachyus var. lanosissimus on unoccupied sites would be mostly funded by Federal, State, and non-governmental organizations, and would likely not require private funding. Consequently, we conclude that the economic effects of the designation of critical habitat for Astragalus pycnostachyus var. lanosissimus are likely to be minimal.

In summary, we have concluded that this final rule would not result in a significant economic effect on a substantial number of small entities. The designation includes only one privately-owned parcel for which a project has been proposed and for which there is no Federal involvement or section 7 consultation required. This rule would result in project modifications only when proposed Federal activities would destroy or adversely modify critical habitat. While this may occur, it is not expected to affect any small entities. Even if a small entity is affected, we do not expect it to result in a significant economic impact, as the measures included in reasonable and prudent alternatives must be economically feasible and consistent with the proposed action. The kinds of measures we anticipate we would recommend can usually be implemented at low cost. Therefore, we are certifying that the designation of critical habitat for Astragalus pycnostachyus var. lanosissimus will not have a significant economic impact on a substantial number of small entities, and a final regulatory flexibility analysis is not required.

Under SBREFA, this rule is not a major rule (see Regulatory Flexibility Act section). Our assessment of the economic effects of this designation is described in the economic analysis. Based upon the effects identified in the economic analysis, this rule will not have an effect on the economy of $100 million or more, will not cause a major increase in costs or prices for consumers, and will not have significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of U.S.-based enterprises to compete with foreign-based enterprises. Please refer to the final economic analysis for a discussion of the effects of this determination.

On May 18, 2001, the President issued Executive Order (E.O.) 13211 on regulations that significantly affect energy supply, distribution, and use. E.O. 13211 requires agencies to prepare Statements of Energy Effects when undertaking certain actions. This rule is not a significant regulatory action under E.O. 13211, and it is not expected to significantly affect energy supplies, distribution, or use because none of those activities currently occur within the critical habitat units or would be affected by the designation. Therefore, this action is not a significant energy action, and no Statement of Energy Effects is required.

In accordance with the Unfunded Mandates Reform Act (2 U.S.C. 1501 et seq. )

(a) This rule will not “significantly or uniquely” affect small governments. A Small Government Agency Plan is not required. Small governments will be affected only to the extent that they must ensure that any programs involving Federal funds, permits, or other authorized activities, will not adversely modify the critical habitat.

(b) This rule will not produce a Federal mandate of $100 million or greater in any year; that is, it is not a “significant regulatory action” under the Unfunded Mandates Reform Act. The designation of critical habitat imposes no obligations on Tribal, State or local governments or private entities.

In accordance with Executive Order 12630 (“Government Actions and Interference with Constitutionally Protected Private Property Rights”), we have analyzed the potential takings implications of designating approximately 420 ac (170 ha) of lands in Santa Barbara and Ventura Counties, California, as critical habitat for Astragalus pycnostachyus var. lanosissimus in a takings implications assessment. The takings assessment concludes that this final rule does not pose significant takings implications.

In accordance with Executive Order 13132, this rule does not have significant Federalism effects. A Federalism assessment is not required. In keeping with Department of the Interior policy, we requested information from, and coordinated development of this critical habitat designation with, appropriate State Resource Agencies in California. The designation of critical habitat in areas currently occupied by Astragalus pycnostachyus var. lanosissimus imposes no additional restrictions beyond those currently in place and, therefore, has little incremental impact on State and local governments and their activities. The designation of critical habitat in unoccupied areas may require consultation under section 7 of the Act on non-Federal lands (where a Federal nexus occurs) that might otherwise not have occurred. The designation may have some benefit to California Department of Parks and Recreation in that the areas essential to the conservation of this subspecies are more clearly defined, and the primary constituent elements of the habitat necessary to the conservation of this subspecies are specifically identified. While this definition and identification do not alter where and what federally sponsored activities may occur, they may assist local governments in long-range planning (rather than waiting for case-by-case section 7 consultations to occur).

In accordance with Executive Order 12988, the Department of the Interior's Office of the Solicitor has determined that this rule does not unduly burden the judicial system and does meet the requirements of sections 3(a) and 3(b)(2) of the Order. We have designated critical habitat in accordance with the provisions of the Endangered Species Act. The rule uses standard property descriptions and identifies the primary constituent elements within the designated areas to assist the public in understanding the habitat needs of Astragalus pycnostachyus var. lanosissimus.

This rule does not contain any new or revised information collections for which OMB approval is required under the Paperwork Reduction Act. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number.

We have determined that an Environmental Assessment and/or an Environmental Impact Statement as defined by the National Environmental Policy Act of 1969 need not be prepared in connection with regulations adopted pursuant to section 4(a) of the Endangered Species Act, as amended. We published a notice outlining our reason for this determination in the Federal Register on October 25, 1983 (48 FR 49244). This final determination does not constitute a major Federal action significantly affecting the quality of the human environment.

In accordance with the President's memorandum of April 29, 1994, “Government-to-Government Relations with Native American Tribal Governments” (59 FR 22951), Executive Order 13175, and the Department of the Interior's manual at 512 DM 2, we readily acknowledge our responsibility to communicate meaningfully with federally recognized Tribes on a Government-to-Government basis. The designation of critical habitat for Astragalus pycnostachyus var. lanosissimus does not contain any Tribal lands or lands that we have identified as impacting Tribal trust resources.

A complete list of all references cited herein, as well as others, is available upon request from the Ventura Fish and Wildlife Office (see ADDRESSES section).

The primary author of this final rule is Rick Farris, Ventura Fish and Wildlife Office (see ADDRESSES section).

The final rule listing the Preble's meadow jumping mouse ( Zapus hudsonius preblei ) (Preble's) as a threatened species under the Endangered Species Act (Act) of 1973, as amended (16 U.S.C. 1531 et seq. ), was published in the Federal Register on May 13, 1998 (63 FR 26517). Section 9 of the Act prohibits take of endangered wildlife. The Act defines take to mean harass, harm, pursue, hunt, shoot, wound, kill, trap, capture, or collect or to attempt to engage in any such conduct. However, the Act also provides for the authorization of take and exceptions to the take prohibitions. Take of listed species by non-Federal property owners can be permitted through the process set forth in section 10 of the Act. For federally funded or permitted activities, take of listed species may be allowed through the consultation process of section 7 of the Act. While section 9 of the Act establishes prohibitions applicable to endangered species, the Service has issued regulations (50 CFR 17.31) applying those same prohibitions to threatened wildlife. These regulations may be tailored for a particular threatened species through promulgation of a special rule under section 4(d) of the Act. When a special rule has been established for a threatened species, the general regulations for some section 9 prohibitions do not apply to that species, and the special rule contains the prohibitions, and exemptions, necessary and advisable to conserve that species.

On May 22, 2001 (66 FR 28125), we adopted a final section 4(d) special rule for the Preble's that provided exemptions from section 9 take prohibitions for certain rodent control activities, ongoing agricultural activities, maintenance and replacement of existing landscaping, and existing uses of water. On October 1, 2002 (67 FR 61531), we amended this rule to provide exemptions for certain noxious weed control and ongoing ditch maintenance activities. The final special rule, as amended, is effective until May 22, 2004. We are now extending the amended special rule permanently.

We believe that the special rule, as amended, is necessary and advisable to provide for the conservation of the Preble's. The special rule has been shown to provide for the conservation of the Preble's by allowing activities that help to maintain the habitat characteristics needed by the species. Although such activities, including ditch maintenance and noxious weed control, may result in limited levels of take, they support the continued presence of occupied habitat that might otherwise be lost to succession or invasive species. Also, by offering flexibility to private landowners for ongoing activities that will not impede the conservation of the species, the special rule provides an incentive for landowners to pursue voluntary conservation efforts and advance our understanding of the species. The rule has garnered support of State and local governments, private landowners, and other interested parties, and we believe that the permanent extension of the special rule will contribute to a lasting, cooperative approach for the recovery of the species.

The special rule is best understood in the context of other regulations and actions, already in place or in development, to provide for conservation of the Preble's. First, section 10(a)(1)(B) of the Act allows the public to obtain from us, in appropriate circumstances, permits allowing take of Preble's, providing that the take is incidental to, and not the purpose of, each action or project. One of the purposes of the special rule is to make, in advance, general decisions that certain types of activities are consistent with the conservation of the Preble's without requiring people to seek additional section 10 permits authorizing those activities. This purpose will be continued by the permanent extension. Additional activities that result in take of Preble's that are not exempted by the special rule may still be permitted by the Service under section 10 of the Act.

Currently, the State of Colorado, the Service, and various local governments in Colorado and Wyoming are working together to develop plans to conserve the Preble's and its habitat. This collaborative approach is expected to result in the development of Habitat Conservation Plans (HCPs) and applications to the Service for incidental take permits under section 10 of the Act. These HCPs will provide an important component of a lasting, effective, and efficient recovery program for the Preble's.

Second, section 7 of the Act requires Federal agencies, in consultation with and with the assistance of the Service, to use their authorities to conserve listed species and ensure that actions authorized, funded, or carried out by the agency are not likely to jeopardize the Preble's. On private land, Federal actions in Preble's habitat that may require consultation include the issuance of section 404 permits by the Army Corps of Engineers for dredge and fill activities regulated under the Clean Water Act. A section 7 consultation was conducted on the current special rule, and the ensuing biological opinion addressed a wide array of potential effects from private actions, some of which have unknown timeframes, some of which occur sporadically, and some of which occur on a regular schedule. The biological opinion found that the special rule would not jeopardize the continued existence of the species, and that the level of take from the rule was not biologically significant. The analysis for this consultation considered effects that could occur within the 36-month period of the existing special rule but also recognized the adverse effects being considered could occur at any time in the future. Therefore, making this special rule permanent does not affect the Preble's or its critical habitat in a way not previously considered in the biological opinion. We have accordingly determined that reinitiation of consultation on the permanent extension of the special rule is not necessary.

Third, a variety of Federal, State, and local programs are available to help preserve the Preble's through the acquisition, preservation, and management of its habitat. These include the Service's Partners for Fish and Wildlife Program, the Natural Resource Conservation Service's wetland/riparian habitat protection programs, grant programs administered by Great Outdoors Colorado, city and county open space programs, and activities of local land trusts. In particular, our Partners for Fish and Wildlife Program has proven to be an especially effective approach for wildlife conservation on agricultural lands by providing funding for restoration of wetlands and riparian habitats.

Fourth, we are committed to development of a recovery program for the Preble's that achieves recovery of the species and provides solutions to conflicts between the species' recovery and economic activities, including agriculture. We believe that a recovery program that integrates both biological and social factors will have the highest chance of success. The Service has established a Recovery Team for the Preble's, and a draft recovery plan will be available for public review in the near future.

The May 22, 2001, special rule and the October 1, 2002, amendment recognized that the take exemptions provided by the rule would support the development of meaningful conservation efforts for the Preble's by State and local governments, agricultural interests, and the general public. The rule and the amendments identified the following conservation benefits to the Preble's—(1) Exemptions regarding rodent control and landscaping would elicit support from landowners for Preble's conservation and recovery; (2) exemptions for ongoing agricultural practices and the exercise of existing water rights would provide a positive incentive for agricultural interests to participate in voluntary conservation activities and advance our understanding of species biology and ecology; (3) exemptions for noxious weed control would facilitate maintaining desirable natural vegetation on which the Preble's depends for survival; and (4) exemptions for ditch maintenance would help assure that currently existing Preble's habitat along ditches remains functionally viable.

The special rule for the Preble's found at 50 CFR 17.40(l) will expire on May 22, 2004. With this rule we are permanently extending the amended special rule to continue the benefits it provides. We recognize that additional information on the Preble's will become available in forthcoming years. We will evaluate this information regarding possible impacts from exempted activities to determine whether any changes, up to and including discontinuance, should be made to the special rule.

Additionally, we are making a correction to the entry for the Preble's on the List of Endangered and Threatened Wildlife in 50 CFR 17.11(h). When the special rule for the Preble's was added to 50 CFR 17.40(l) on May 22, 2001 (66 FR 28125), we failed to amend the table in 50 CFR 17.11(h) to reflect the existence of the new special rule. Therefore, we are making the correction to the table in 50 CFR 17.11(h) in this rulemaking action.

A proposed rule permanently extending the existing special rule was published in the Federal Register on February 24, 2004 (69 FR 8359), and public comments were solicited. A public hearing was held on April 1, 2004, in Wheatland, Wyoming. Twenty-two public comments were received, primarily supporting the extension. A few asked for expansion of take exemptions to cover additional activities. Only one opposed the extension on general disagreement over the killing of threatened and endangered species. Comments were received from the State of Wyoming supporting the extension of the special rule and also requesting that additional kinds of activities be exempted under the special rule. In order to add exemptions to a rule, we must first propose them through a proposed rule published in the Federal Register that provides an opportunity for public comment. However, because we did not include exemptions for additional new activities in our February 24, 2004, proposal, it is not possible for us to include them in this final rule. In the future, it may be appropriate for us to consider proposing additional exemptions. At that time, we will need to evaluate the conservation benefit to the species and prepare a proposed rule for public comment.

In accordance with 5 U.S.C. 553(d)(1), we are making this rule effective upon publication because it grants or recognizes an exemption or relieves a restriction. This rule provides exemptions from the take provisions under section 9 of the Act for persons engaging in rodent control, ongoing agricultural activities, landscaping, ongoing use of existing water rights, noxious weed control, and ditch maintenance activities.

We prepared a Record of Compliance for the May 22, 2001, final rule that exempted the four activities of rodent control, ongoing agricultural activities, landscaping, and ongoing use of existing water rights from the take prohibitions listed in section 9 of the Act. A Record of Compliance certifies that a rulemaking action complies with the various statutory, Executive Order, and Department Manual requirements applicable to rulemaking. Amendment of the May 22, 2001, rule to include the two additional exemptions (noxious weed control and ditch maintenance activities) did not add any significant elements to this Record of Compliance. Permanent extension of the amended special rule also does not add any significant elements to this Record of Compliance.

Without this extension, activities included in the special rule, as amended, would no longer be exempted from the take prohibitions. This rule continues the exemptions and allows landowners to engage in certain activities, as identified in the rule, that may result in take of Preble's. Without this extension, anyone engaging in those activities might need to seek an authorization from us through an incidental take permit under section 10(a)(1)(B) or an incidental take statement under section 7(a)(2) of the Act. This process takes time and can involve an economic cost. This rule allows these landowners to avoid the costs associated with abstaining from conducting any such activities that may result in take, modifying these activities to prevent take from occurring, or seeking an incidental take permit from us.

In accordance with the criteria in Executive Order 12866, the Office of Management and Budget (OMB) has determined that this rule is a significant regulatory action as this rule may raise novel legal or policy issues. This rule will not have an annual economic impact of more than $100 million, or significantly affect any economic sector, productivity, jobs, the environment, or other units of government. This rule reduces the regulatory burden of the listing of the Preble's under the Act as a threatened species by continuing certain exemptions to the section 9 take prohibitions that would otherwise apply throughout the Preble's range.

Preble's habitat, which overlaps farming and ranching businesses, primarily affects four southeast Wyoming counties—(1) Converse; (2) Laramie; (3) Platte; and (4) Albany. This four-county area contains 1,739 farms and ranches covering 3.6 million hectares (8.9 million acres). The average size of an agricultural operation is about 2,064 hectares (5,100 acres), although individual operations vary greatly in size. The total marketing value of livestock and crops, measured as cash receipts, is about $182.5 million.

As previously discussed, the Service has adopted special regulations pursuant to section 4(d) of the Act for Preble's, and these regulations are currently set to expire on May 22, 2004. Specifically, these regulations provide exemption from take provisions under section 9 for certain activities related to rodent control, ongoing agricultural activities, landscape maintenance, perfected water rights, certain noxious weed control, and ditch maintenance activities. Should this regulation expire, such activities could result in the incidental take of Preble's, which is prohibited under section 9 of the Act. However, section 10 of the Act does allow landowners to obtain a permit to conduct otherwise lawful activities that may result in incidental take of a listed species. The incidental take permit requires the applicant to prepare, and the Service approve, a habitat conservation plan (HCP). The HCP may include certain restrictions to agricultural activities to minimize incidental take of Preble's.

The types of restrictions the Service might impose on agricultural activities to minimize take are expected to vary significantly from one application to another, depending on the specific situation. However, Service guidelines call for mitigating the take of Preble's to the maximum extent practicable. Examples of mitigation conditions include fencing, planting willows, or other measures intended to create a buffer zone along waterways in riparian areas. The Service also may impose restrictions on the methods or timing of activities associated with irrigation ditch maintenance.

The primary economic impacts to landowners associated with enforcement of the Act, should this section 4(d) rule expire, are the costs of preparing HCPs for the Preble's and the costs associated with any activity restrictions imposed by the Service to minimize take of the Preble's. These impacts would potentially affect agricultural operations in southeast Wyoming. The primary land use activities likely to be impacted by sections 9 and 10 of the Act are haying and grazing, and irrigation ditch maintenance. A short discussion follows of the impacts farmers and ranchers could incur should this regulation lapse.

The three commonly used methods of ditch maintenance are burning, flushing (flowing water through a ditch to clear blockages), and dipping (mechanically clearing blockages). Of these three options, the most cost effective is burning, which also may be the most likely to result in incidental take of Preble's. Because of this, some landowners are concerned that the burning could be prohibited after the expiration of the special rule, which would impact their irrigation activities.

An example of the potential impacts to irrigation canal and ditch maintenance is illustrated using estimates developed by the Wheatland Irrigation District. The Wheatland Irrigation District estimates that its annual irrigation ditch maintenance costs would increase by approximately 250 percent if burning is reduced by 50 percent. If all burning were prohibited, irrigation ditch maintenance costs could increase by approximately 400 percent annually.

Haying and grazing activities also would be subject to sections 9 and 10 of the Act to minimize take of the Preble's. To avoid violating this provision, landowners would have to either cease activities that might result in incidental take, or they may need to submit an application to the Service for an incidental take permit, including an HCP. As with irrigation canal and ditch maintenance activities, landowners could expect some restrictions or conditions on haying and grazing activities as mitigation for the incidental take of Preble's.

The types of restrictions or conditions would vary depending upon the situation. In situations where riparian areas have been degraded by intensive grazing activity, mitigation measures for an incidental take permit may include restrictions on the number of Animal Unit Months or AUMs (an AUM is the amount of forage needed to sustain one cow and her calf, one horse, or five sheep or goats for a month) within riparian areas, the construction of fencing with water gaps to keep herds out of riparian areas, and planting willows along stream banks. In situations where riparian areas are not degraded, mitigation measures may be minimal. The economic impacts of sections 9 and 10 of the Act on haying and grazing activities should this regulation expire can thus be expected to vary widely from landowner to landowner.

By permanently extending this section 4(d) rule, farm and ranch operators will avoid future costs associated with ensuring that their otherwise legal activities avoid incidentally taking Preble's. Consequently, the economic effect of the rule benefits landowners and the economy. This effect does not rise to the level of “significant” under Executive Order 12866.

This rule should not create inconsistencies with other Federal agencies' actions. Other Federal agencies are mostly unaffected by this rule.

This rule should not materially affect entitlements, grants, user fees, loan programs, or the rights and obligations of their recipients. Because this rule would allow landowners to continue otherwise prohibited activities without first obtaining individual authorization, the rule's impacts on affected landowners is positive.

We have previously promulgated section 4(d) special rules for this and other species, including the amended special rule for the Preble's pertaining to rodent control, ongoing agricultural activities, landscaping, existing uses of water, noxious weed control, and ongoing ditch maintenance activities. This rule permanently extends the effective period of the amended special rule for the Preble's. However, OMB has determined that this proposed rule may raise novel legal or policy issues. Therefore, in accordance with Executive Order 12866, OMB has reviewed this rule.

We have determined that this rule will not have a significant economic effect on a substantial number of small entities as defined under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ). A final regulatory flexibility analysis is not required, and a Small Entity Compliance Guide is not required. This rule reduces the regulatory burden of the listing of the Preble's as a threatened species. Without an extension of the amended special rule, all of the take prohibitions listed in section 9 of the Act would apply throughout the range of the Preble's. This rule allows certain affected landowners to continue to engage in certain activities that may result in take of Preble's, and to avoid the costs associated with abstaining from conducting these activities to avoid take of Preble's or seeking incidental take permits from us.

As previously discussed, this rulemaking will primarily affect farm and ranch operations within four counties in southeastern Wyoming. Although the precise numbers of affected operations are not known, the total number of farms and ranches in the area is estimated to be 1,739. The 2002 total cash receipts for these operations were approximately $182.5 million, which represents about 25 percent of the State total. Based on the State ratio of net farm income to animal and crop cash receipts (12 percent), the estimated average net farm income in this area would be $21,900.

The Office of Advocacy for the Small Business Administration defines small entities in the farm and ranch sector as those each having less than $750,000 in annual receipts. This qualifies most of the farms and ranches in the area as small businesses, according to data published in 1998 by the U.S. Department of Agriculture.

The permanent extension of the section 4(d) rule will allow these small entities to avoid incurring costs associated with the development of an HCP and the administrative costs that would reflect the effort to obtain an incidental take permit. Administrative costs alone could cost between $3,000 and $4,000, according to a recent economic analysis conducted by the Service as part of the critical habitat designation for the Preble's. Depending on how such costs are expensed, the cost to obtain a permit could be relatively significant.

This rulemaking avoids such impacts by providing an exemption from the take provisions under section 9 for certain activities related to rodent control, ongoing agricultural activities, landscape maintenance, use of perfected water rights, certain noxious weed control, and ditch maintenance activities. Consequently, pursuant to 5 U.S.C. 605(b), we are certifying that this rulemaking will not have a significant economic effect on a substantial number of small entities.

This rule is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act. This rule will not have an annual effect on the economy of $100 million or more; will not cause a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions; and will not have significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of U.S.-based enterprises to compete with foreign-based enterprises. As described above, this rule will continue to reduce regulatory burdens on affected entities, who are mostly agricultural producers.

In accordance with the Unfunded Mandates Reform Act (2 U.S.C. 1501 et seq. ), this rule will not impose an unfunded mandate on State, local, or tribal governments, or the private sector, of more than $100 million per year. This rule will not have a significant or unique effect on State, local, or tribal governments, or the private sector. A Small Government Agency Plan is not required.

In accordance with Executive Order 12630, this rule does not have significant takings implications. By continuing reductions in the regulatory burden placed on affected landowners resulting from the listing of the Preble's as a threatened species, this rule reduces the likelihood of potential takings. Affected landowners will continue to have more freedom to pursue certain activities that may result in take of Preble's without first obtaining individual authorization.

In accordance with Executive Order 13132, this rule does not have sufficient federalism implications to warrant the preparation of a federalism assessment. Currently, the State of Colorado, the Service, and various local governmental entities in Colorado and Wyoming are working together to develop plans to conserve the Preble's and its habitat. This collaborative approach is expected to result in the development of HCPs that should support a lasting, effective, and efficient conservation program for the Preble's. To support such efforts, we wish to permanently extend the special rule. The current amended special rule would otherwise expire on May 22, 2004.

In accordance with Executive Order 12988, the Office of the Solicitor has determined that this rule does not unduly burden the judicial system and meets the requirements of sections 3(a) and 3(b)(2) of the Executive Order.

We have examined this rule under the Paperwork Reduction Act of 1995 and found it to contain no requests for information. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number.

The National Environmental Policy Act (NEPA) analysis has been conducted. An Environmental Assessment was prepared for the May 22, 2001, final special rule, and for the additional exemptions covered in the amended rule. The extension of the October 1, 2002, amended special rule does not alter the analyses made in the Environmental Assessment. The Environmental Assessment discussed impacts to the mouse that are not specific to any time period, that is, they apply equally to both the short term and the long term. This is due to the fact that any possible take from year to year is not cumulative, because the species has a short life-span, and the types of activities allowed under the special rule are not related to any particular timeframe. This rule was not found to be significant under NEPA as these exemptions reduce regulatory burdens for activities that result in minimal levels of take allowing conservation efforts to be focused on those actions that will provide the greatest conservation benefit for the species. Therefore, no modification of the Environmental Assessment is needed.

In accordance with the President's memorandum of April 29, 1994, “Government-to-Government Relations With Native American Tribal Governments” (59 FR 22951) and Executive Order 13175, we have evaluated possible effects on federally recognized Indian Tribes. We have determined that, because no Indian trust resources occur within the range of the Preble's, this rule has no effects on federally recognized Indian Tribes.

We have evaluated this rule in accordance with Executive Order 13211 and have determined that this rule has no effects on energy supply, distribution, or use. Therefore, this action is not a significant energy action, and no Statement of Energy Effects is required.