[Federal Register Volume 69, Number 171 (Friday, September 3, 2004)]
[Proposed Rules]
[Pages 53866-53879]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-20038]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 166

[OPP-2004-0038; FRL-7371-3]
RIN 2070-AD36


Pesticides; Emergency Exemption Process Revisions

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing several revisions to its regulations 
governing emergency exemptions that allow unregistered uses of 
pesticides to address emergency pest conditions for a limited time. The 
first significant change would allow applicants for certain repeat 
exemptions a simple way to re-certify that the emergency conditions 
that initially qualified for an exemption continue to exist in the 
second and third years. The second significant proposal would re-define 
significant economic loss and adjust the data requirements for 
documenting the loss. These proposed revisions would streamline and 
improve the application and review process by reducing the burden to 
both applicants and the EPA, allowing for quicker decisions by the 
Agency, and providing for more consistently equitable determinations of 
``significant economic loss'' as the basis for an emergency. These two 
proposals are currently being employed in limited pilot programs. In 
addition, EPA is proposing several minor revisions to the regulations 
to clarify that quarantine exemptions may be used for control of 
invasive species, and to update or revise certain administrative 
aspects of the regulations. All of these proposed revisions can be 
accomplished without compromising protections for human health and the 
environment.

DATES: Comments must be received on or before November 2, 2004.

ADDRESSES: Submit your comments, identified by docket ID number OPP-
2004-0038, by one of the following methods:
    Federal eRulemaking Portal: http://www.regulations.gov/. Follow the 
on-line instructions for submitting comments.
    Agency Web Site: http://www.epa.gov/edocket/. EDOCKET, EPA's 
electronic public docket and comment system, is EPA's preferred method 
for receiving comments. Follow the on-line instructions for submitting 
comments.
    E-mail: [email protected].
    Mail: Public Information and Records Integrity Branch (PIRIB) 
(7502C), Office of Pesticide Programs (OPP), Environmental Protection 
Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001.
    Hand Delivery: Public Information and Records Integrity Branch 
(PIRIB), Office of Pesticide Programs (OPP), Environmental Protection 
Agency, Rm. 119, Crystal Mall 2, 1801 S. Bell St., Arlington, 
VA. Such deliveries are only accepted during the Docket's normal hours 
of operation, and special arrangements should be made for deliveries of 
boxed information.
    Instructions: Direct your comments to docket ID number OPP-2004-
0038. EPA's policy is that all comments received will be included in 
the public docket without change and may be made available online at 
http://www.epa.gov/edocket, including any personal information 
provided, unless the comment includes information claimed to be 
Confidential Business Information (CBI) or other information whose 
disclosure is restricted by statute. Do not submit information that you 
consider to be CBI or otherwise protected through EDOCKET, 
regulations.gov, or e-mail. The EPA EDOCKET and the federal 
regulations.gov websites are ``anonymous access'' systems, which means 
EPA will not know your identity or contact information unless you 
provide it in the body of your comment. If you send an e-mail comment 
directly to EPA without going through EDOCKET or regulations.gov, your 
e-mail address will be automatically captured and included as part of 
the comment that is placed in the public docket and made available on 
the Internet. If you submit an electronic comment, EPA recommends that 
you include your name and other contact information in the body of your 
comment and with any disk or CD-ROM you submit. If EPA cannot read your 
comment due to technical difficulties and cannot contact you for 
clarification, EPA may not be able to consider your comment. Electronic 
files should avoid the use of special characters, any form of 
encryption, and be free of any defects or viruses. For additional 
information about EPA's public docket visit EDOCKET on-line or see the 
Federal Register of May 31, 2002 (67 FR 38102) (FRL-7181-7). For 
additional instructions on submitting comments, go to Unit I.C. of the 
SUPPLEMENTARY INFORMATION section of this document.
    Docket: All documents in the docket are listed in the EDOCKET index 
at http://www.epa.gov/edocket/. Although listed in the index, some 
information is not publicly available, i.e., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, is not placed on the Internet and will be 
publicly available only in hard copy form. Publicly available docket 
materials are available either electronically in EDOCKET or in hard 
copy at the Public Information and Records Integrity Branch (PIRIB), 
Rm. 119, Crystal Mall 2, 1801 S. Bell St., Arlington, VA. This 
Docket Facility is open from 8:30 a.m. to 4 p.m., Monday through 
Friday, excluding legal holidays. The Docket telephone number is (703) 
305-5805.

FOR FURTHER INFORMATION CONTACT: Joseph Hogue, Field and External 
Affairs Division (7506C), Office of Pesticide Programs, Environmental 
Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-
0001; telephone number: 703-308-9072; fax number: 703-305-5884; e-mail 
address: [email protected].

SUPPLEMENTARY INFORMATION:

I. General Information

A. Does this Action Apply to Me?

    You may be potentially affected by this action if you are a 
Federal, State, or Territorial government agency that petitions EPA for 
an emergency use authorization under section 18 of the Federal 
Insecticide, Fungicide, and Rodenticide Act (FIFRA). Regulated 
categories and entities may include, but are not limited to:
     Federal Government (NAICS Code 9241), i.e., Federal 
agencies that petition EPA for section 18 use authorization.
     State or Territorial governments (NAICS Code 9241), i.e., 
States, as defined in FIFRA section 2(aa), that petition EPA for 
section 18 use authorization.
    This listing is not intended to be exhaustive, but rather provides 
a guide for readers regarding entities likely to be affected by this 
action. Other types of entities not listed in this unit could also be 
affected. The North American Industrial Classification System (NAICS) 
codes have been provided to assist you and others in determining 
whether this action might apply to

[[Page 53867]]

certain entities. To determine whether you or your business may be 
affected by this action, you should carefully examine the summary of 
the applicability provisions as found in Unit III.B. of this proposed 
rule. If you have any questions regarding the applicability of this 
action to a particular entity, consult the person listed under FOR 
FURTHER INFORMATION CONTACT.

B. How Can I Access Electronic Copies of this Document and Other 
Related Information?

    In addition to using EDOCKET (http://www.epa.gov/edocket/), you may 
access this Federal Register document electronically through the EPA 
Internet under the ``Federal Register'' listings at http://www.epa.gov/fedrgstr/. A frequently updated electronic version of 40 CFR part 166 
is available at E-CFR Beta Site Two at http://www.gpoaccess.gov/ecfr/.

C. What Should I Consider as I Prepare My Comments for EPA?

    1. Submitting CBI. Do not submit this information to EPA through 
EDOCKET, 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 ID number and other 
identifying information (subject heading, Federal Register date, and 
page number).
    ii. Follow directions. The Agency may ask you to respond to 
specific questions or organize comments by referencing a Code of 
Federal Regulations (CFR) part or section number.
    iii. Explain why you agree or disagree; suggest alternatives and 
substitute language for your requested changes.
    iv. Describe any assumptions and provide any technical information 
and/or data that you used.
    v. If you estimate potential costs or burdens, explain how you 
arrived at your estimate in sufficient detail to allow for it to be 
reproduced.
    vi. Provide specific examples to illustrate your concerns, and 
suggest alternatives.
    vii. Explain your views as clearly as possible, avoiding the use of 
profanity or personal threats.
    viii. Make sure to submit your comments by the comment period 
deadline identified.

II. Purpose

    The primary purpose of this notice of proposed rulemaking is to 
simplify the process of applying for emergency exemptions, and allow 
for quicker responses to emergency pest conditions, without affecting 
current protections for human health and the environment. This document 
proposes several revisions to the regulations at 40 CFR part 166, in an 
effort to make a variety of improvements to the pesticide emergency 
exemption program and process. The two most significant of the revised 
practices being proposed are streamlining provisions intended to reduce 
the burden to both applicants and the Agency, and expedite decisions on 
exemption requests. The first of these revisions would expressly 
authorize applicants for certain repeat exemptions to re-certify that 
an emergency condition continues in the second and third years, and to 
incorporate by reference all information submitted in a previous 
application rather than annually submit complete applications. The 
second revision would pertain to the determination of ``significant 
economic loss,'' shifting the emphasis from the historical profit 
variability to the potential loss relative to yields and/or revenues 
without the emergency, and establishing a tiered analysis that will in 
many cases substantially reduce applicants' data burden related to 
substantiating the significance of losses. Each of these revisions 
would streamline the application and review process for emergency 
exemptions. In addition, the proposed economic assessment approach 
would directly result in more consistently equitable determinations of 
whether a significant economic loss is expected than does the current 
approach. These two streamlining proposals are currently being employed 
in limited pilot projects.
    EPA also intends to achieve several other objectives in this 
proposed rule. First, revisions are proposed to correct or update 
several minor administrative aspects of the emergency exemption 
regulations, which have not been revised since 1986. The reason for 
each of these minor administrative revisions falls into one of the 
following categories: Correction of typographical or administrative 
errors; conformance with requirements of the Food Quality Protection 
Act of 1996 (FQPA); and codification of improved practices that have 
been voluntarily but widely followed by applicants. Second, the Agency 
is proposing to add specific language to the regulations to clarify 
that treatment of ``invasive species'' is a valid basis for issuing a 
quarantine exemption. Third, this proposed rule includes a discussion 
of how the Agency protects endangered and threatened species, and 
ensures compliance with the Endangered Species Act, through its 
implementation of the emergency exemption program. No regulatory 
proposals are included relative to endangered species measures. 
Finally, this proposed rule informs the public that EPA has revised its 
tentative plan to include in this proposed rule a proposal to allow 
exemptions for the purpose of pest resistance management. An 
explanation of why resistance management exemptions are not being 
proposed at this time, and a discussion of what alternative plans the 
Agency has for addressing resistance management, are included.
    The Agency encourages interested parties to submit comments on any 
of the proposed regulatory revisions by following the instructions 
under ADDRESSES. Commenters should explain any modifications they 
suggest for the proposed revisions, along with their rationale. EPA 
would like applicants for emergency exemptions to submit comments 
concerning their experience with the pilot for the two streamlining 
provisions being proposed. Applicants who have participated in the 
pilot are asked to submit comments explaining the pros and cons of the 
revised practices. Applicants who were eligible for, but elected not to 
participate in, the pilot are asked to submit comments explaining why 
they did not participate. Units V. and VI. outline the specific 
revisions being proposed, but also include discussion asking potential 
commenters to consider alternative approaches for particular aspects of 
the proposal. In addition to inviting public comments on this proposed 
rule, EPA plans to consult the Pesticide Program Dialogue Committee 
(PPDC) on these proposed revisions, as it has prior to initiating the 
pilot for the streamlining proposals. Input from the public comments 
received in response to this proposed rule, and experience from the 
pilot will be carefully considered, when deciding whether to modify 
these proposed revisions for the final rule.

[[Page 53868]]

III. Statutory and Regulatory Framework

A. Statutory Authority

    EPA regulates the use of pesticides under the authority of two 
federal statutes: the Federal Insecticide, Fungicide, and Rodenticide 
Act (FIFRA) and the Federal Food, Drug, and Cosmetic Act (FFDCA).
    FIFRA provides the basis for regulation, sale, distribution and use 
of pesticides in the United States. FIFRA generally prohibits the sale 
and distribution of any pesticide product, unless it has been 
registered by EPA in accordance with section 3. (7 U.S.C. 136a.). 
Section 18 of FIFRA gives the Administrator of EPA broad authority to 
exempt any Federal or State agency from any provision of FIFRA if the 
Administrator determines that emergency conditions exist which require 
such an exemption. (7 U.S.C. 136p). Under section 2(aa) of FIFRA, the 
term ``State'' is defined to include a ``State, the District of 
Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, Guam, 
the Trust Territory of the Pacific Islands, and America Samoa.'' (7 
U.S.C. 136(aa)).
    Section 408 of FFDCA authorizes EPA to set maximum residue levels, 
or tolerances, for pesticides used in or on foods or animal feed, or to 
exempt a pesticide from the requirement of a tolerance, if warranted. 
(21 U.S.C. 346a).

B. Existing Regulatory Provisions

    Regulations governing FIFRA section 18 emergency exemptions are 
codified in 40 CFR part 166. Generally, these regulations set forth 
information requirements, procedures, and standards for EPA's approval 
or denial of a request from a Federal or State agency for an exemption 
to allow a use of a pesticide that is not registered when such use is 
necessary to alleviate an emergency condition.
    Federal and State agencies may apply for an emergency exemption due 
to a public health emergency, a quarantine emergency, or a ``specific'' 
emergency. Most emergency exemptions requested or approved fall under 
the category of ``specific exemptions'' and are requested in order to 
avert an economic emergency for an agricultural activity. Typical 
justifications for specific exemptions include, but are not limited to, 
the expansion of the range of a pest; the cancellation or removal from 
the market of a previously registered and effective pesticide product; 
and the development of resistance in pests to a registered product, or 
loss of efficacy of available products for any reason. Additionally, an 
emergency situation is generally considered to exist when no other 
viable (chemical or non-chemical) means of control exist, and where the 
emergency situation will cause significant economic losses to affected 
individuals if the exemption is not approved.
    A Federal or State agency must submit an emergency exemption 
request in writing that documents the emergency situation, the 
pesticide proposed for the use, the target pest, the crop, the rate and 
number of applications to be made, the geographical region where the 
pesticide would be applied, and a discussion of risks that may be posed 
to human health or to the environment as a result of the pesticide use 
(40 CFR 166.20). EPA reviews the request, verifying the existence of 
the emergency, assessing risks posed to human health through food, 
drinking water, and residential exposure, assessing risks posed to 
farmworkers and other handlers of the pesticide, assessing any adverse 
effects on non-target organisms (including Federally listed endangered 
species), and assessing the potential for contamination of ground water 
and surface water. If an application for the requested use has been 
made in previous years, EPA also does an assessment of the progress 
toward registration for the use of the requested chemical on the 
requested crop, and considers this status in the final determination to 
approve or deny the exemption. If EPA concludes that the situation is 
an emergency, and that the use of the pesticide under the exemption 
will be consistent with the standards of section 18 and 40 CFR part 
166, and, for food uses, section 408 of FFDCA, then EPA may authorize 
emergency use of the pesticide.
    Use under specific and public health exemptions can be authorized 
for periods not to exceed 1 year, and uses under quarantine exemptions 
can be authorized for up to 3 years (40 CFR 166.28). Public health 
exemptions are for the control of pests that will cause a significant 
risk to human health, while quarantine exemptions are intended to 
control the introduction or spread of pests that are new or not known 
to be widely prevalent or distributed within and throughout the United 
States and its territories. Emergency exemptions should not be viewed 
as an alternative to registering the use(s) needed for longer periods. 
If the situation addressed with the section 18 exemption persists, or 
is expected to persist, affected entities must take the proper steps to 
amend the existing registration or seek a new registration to address 
that future need.

IV. Background

A. April 2003 Notice Initiating Pilot for Two Revisions Now Being 
Proposed

    EPA published a Notice in the Federal Register on April 24, 2003 
(68 FR 20145) (FRL-7293-6), announcing the initiation of a limited 
pilot program to test two potential improvements to the emergency 
exemption process. The two potential improvements currently being 
piloted are: (1) Allowing applicants for certain repeat exemptions to 
re-certify that the emergency condition still exists in the second and 
third years, and to incorporate by reference all information submitted 
in a previous application rather than annually submit complete new 
applications and, (2) a new approach to documenting a significant 
economic loss that focuses on the significance of the potential loss 
relative to yields and/or revenues without the emergency rather than 
comparison to historical profit variation. The April 2003 Notice also 
discussed whether exemptions for the purpose of pest resistance 
management might be allowed. Finally, the Notice solicited public 
comment on all three potential changes, and announced EPA's plan to 
issue a proposed rule addressing them. The two revised practices 
included in the pilot are also included in this proposed rule, without 
the restriction to reduced-risk pesticides that limits the scope of the 
pilot.
    Anyone interested in the background leading up to the pilot 
program, or other related documents, may wish to review the Federal 
Register Notice announcing the pilot, and the related documents. A 
public docket was established for that Notice under docket ID number 
OPP-2002-0231. Interested parties should follow instructions under 
ADDRESSES for accessing the docket, but use docket ID number OPP-2002-
0231 to access the docket for the April 24, 2003 Notice.

B. Summary of Early Pilot Experience

    The pilot program is limited to requests for a specific set of 
``reduced-risk'' pesticides, which significantly limits the number of 
potentially eligible exemption requests. The summary of participation 
in the pilot focuses on the 2003 growing season, since the 2004 season 
was still underway at this time.
    The first part of the pilot allowed applicants for eligible repeat 
exemptions to re-certify the existence of their emergency condition. 
The re-certification pilot involves exemptions that meet all of the 
following eligibility criteria: (1) EPA approved the same exemption the 
previous year, and it is the second or third year of the request

[[Page 53869]]

by that applicant, (2) the emergency situation can reasonably be 
expected to continue for longer than 1 year, (3) the exemption is not 
for a new chemical, a first food use, or for a chemical under Special 
Review, and (4) the exemption is for a chemical previously identified 
by EPA as reduced-risk. For the 2003 growing season, 16 exemptions were 
identified by EPA as eligible for re-certification and the list was 
made available to States and the public. Of the 16 exemptions eligible 
to repeat by re-certification, 7 submitted applications using re-
certification. Of the nine exemptions that were eligible but for which 
no re-certification was submitted, three were for pesticide uses that 
had obtained federal registration under FIFRA section 3 since the 2002 
exemption; three were not requested at all in 2003; and the remaining 
three were requested using conventional emergency exemption requests. 
In the seven instances of a re-certification, EPA staff was able to 
make expedited decisions with an average of 9 days from receipt of the 
request until the decision was made.
    The second part of the pilot, for the loss-based approach for 
determining a significant economic loss, is limited only by the 
restriction to reduced-risk pesticides. Unlike the re-certification 
part of the pilot, there is no specific list of eligible exemptions, 
only eligible pesticide active ingredients to be requested. Therefore, 
there is no fixed number of eligible exemptions for the loss-based 
economic approach. EPA did not receive any submissions using the loss-
based approach for determining a significant economic loss under the 
terms of the pilot during the 2003 growing season, although we have 
already received some in 2004. For the past year, the Agency has 
routinely prepared side-by-side assessments that evaluate the data 
under the traditional method, as well as the loss-based approach 
outlined in the pilot, to gain a better understanding and compare the 
ways of measuring whether pest situations represent emergencies. The 
loss-based approach is considered to measure more accurately the 
significance of losses associated directly with the pest problem, and 
is less influenced by other factors such as market fluctuations. In 
addition, cursory assessments of available past submissions have been 
done using the loss-based approach.
    Both of these proposed revisions offer a cost saving and reduce the 
burden on States as well as on EPA. The Agency expects that the level 
of participation in both areas of the pilot will increase as the level 
of familiarity and understanding among State agencies increases. 
Efforts to facilitate the understanding and use of the pilot 
initiatives are currently underway.

V. Proposed Revisions to Emergency Exemption Process

    The two revisions discussed below are currently being employed in 
limited pilot programs that were initiated by a Federal Register Notice 
in April 2003. A guidance document was prepared for use by applicants 
to participate in the pilot programs. After reviewing this Unit V., 
interested parties may find it useful to review that guidance document 
for the Agency's detailed plans for implementation of these revisions. 
A final guidance document will be made available when a final rule is 
published. In the meantime, the guidance document for the pilot would 
be particularly helpful in understanding what information would be 
required to be submitted by applicants under the proposed revisions. 
The pilot guidance document for the 2004 growing season is available in 
the public docket. Interested parties should follow instructions under 
ADDRESSES.

A. Re-certification of Emergency Condition by Applicants

    1. What is our current practice? EPA authorizes emergency 
exemptions (except quarantine exemptions) for no longer than 1 year. 
However, depending on the nature of the non-routine condition that 
caused the emergency, some exemptions may subsequently be approved 
again, 1 year at a time. Currently, EPA conducts a full review of an 
application for the first year of an exemption, to determine whether an 
emergency condition exists, to ensure the use will not result in 
unreasonable adverse effects to human health or the environment, and, 
if the use will result in pesticide residues in food or feed, to make a 
safety finding consistent with section 408 of the Federal Food, Drug, 
and Cosmetic Act (FFDCA).
    If the emergency condition continues in subsequent years, 
applicants may submit a similar application, in which case the Agency 
must again confirm the emergency condition and acceptability of the 
risk. For requests after the first year, the applicant again submits 
information to support the emergency finding, with a full application, 
including updated economic data. For these repeat requests EPA 
reevaluates the situation to determine, relative to the first year, 
whether: (1) The emergency condition has changed; (2) any alternative 
products have been newly registered for the use, or other effective 
pest control techniques are now available; (3) any changes have 
occurred in the status of the chemical's risk assessment; (4) the 
requested conditions of use have changed; and (5) the pesticide for the 
requested use has made sufficient progress towards registration.
    2. How would re-certification work under the proposed approach? 
This proposed revision would reduce the burden on applicants who seek 
re-approval of certain emergency exemptions in subsequent years. EPA 
proposes to add a new paragraph (b)(5) to 40 CFR 166.20, which would 
allow applicants for eligible repeat exemptions to submit applications 
that rely on the preceding year's submission to document the economic 
impact of the pest emergency. This re-certification approach would 
allow applicants to incorporate by reference all information submitted 
in a previous application, instead of submitting a complete re-
application and supporting documentation. The re-certification of the 
emergency condition by the applicant combined with the materials 
already in EPA's files would serve as the basis for EPA's determination 
as to whether an emergency condition continues to exist.
    Upon approval of any emergency exemption, EPA would make an up-
front, separate, additional determination regarding eligibility for a 
streamlined re-certification application the following year, in the 
event that the applicant reapplies the next year. Eligibility for a re-
certification application would not determine whether an emergency 
exemption application could be approved. Rather eligibility would 
affect the information that should be submitted in the application. EPA 
would consider several factors in determining eligibility to use a 
streamlined re-certification application:
    1. Whether the emergency situation could reasonably be expected to 
continue for longer than 1 year. An emergency situation could 
reasonably be expected to continue where, for example, a registered 
product relied upon by growers becomes permanently unavailable, a pest 
expands its range, or a registered product ceases to be effective 
against a pest. Situations that would not be expected to continue would 
include a temporary supply problem of a registered product, an isolated 
weather event, or a sporadic pest outbreak.
    2. Whether an emergency exemption has been approved more than twice 
for the same pesticide at the same site. EPA recognizes that some 
emergency situations can continue for more than 1 year, however, 
pesticide registration

[[Page 53870]]

pursuant to FIFRA section 3 is the appropriate long-term response, 
rather than the section 18 emergency exemption. According to the 
regulations and EPA policy, a failure to request registration of a use 
requested under section 18 for more than 3 years may indicate that 
adequate progress toward registration is not being made. Therefore, EPA 
carefully examines all exemption submissions submitted for more than 3 
years.
    3. Whether the pesticide product, owing to its regulatory status, 
warrants heightened review before any additional use is approved. EPA 
will rely on the same criteria used in the existing regulations at 40 
CFR 166.24(a), which identifies a number of different situations where, 
upon receipt of an application for an emergency exemption, the 
regulatory status of a pesticide product calls for public notice and 
comment:
    (1) The application proposes use of a new chemical.
    (2) The application proposes the first food use of an active 
ingredient.
    (3) The application proposes any use of a pesticide if the 
pesticide has been subject to a suspension notice under section 6(c) of 
the Act.
    (4) The application proposes use of a pesticide which:
    (i) Was the subject of a notice under section 6(b) of the Act and 
was subsequently canceled.
    (ii) Is intended for a use that poses a risk similar to the risk 
posed by any use of the pesticide which was the subject of the notice 
under section 6(b).
    (5) The application proposes use of a pesticide which:
    (i) Contains an active ingredient which is or has been the subject 
of a Special Review.
    (ii) Is intended for a use that could pose a risk similar to the 
risk posed by any use of the pesticide which is or has been the subject 
of the Special Review.
    In instances where EPA determines that the emergency situation 
could reasonably be expected to continue, where an emergency exemption 
has been approved not more than twice for the same pesticide at the 
same site, and where the pesticide product's regulatory status does not 
warrant heightened review, EPA would notify the successful applicant 
that, should it re-apply the following year, it is eligible to use a 
re-certification application. EPA anticipates that this notification 
would be included in the notice of approval of the current year's 
application. However, if an exemption is not classified as a candidate 
for re-certification in the approval notice, and an applicant believes 
that subsequent information would make it eligible, the applicant may 
contact the Agency to request an eligibility determination. In some 
instances, EPA may determine that an emergency condition exists, and 
that the exemption is eligible for a re-certification application the 
following year, yet conclude that additional information should be 
gathered in order to support approval in future years. In such 
instances, EPA may indicate in the approval notice that the exemption 
is eligible for re-certification upon submission of the specified 
information.
    Under the proposed rule, an eligible re-certification applicant 
would be exempted from the information requirements of 40 CFR 
166.20(a)(1) through (a)(10), and of the existing 40 CFR 166.20(b), 
where the applicant certifies that:
    (i) The emergency condition described in the preceding year's 
application continues to exist.
    (ii) Except as expressly identified, all information submitted in 
the preceding year's application is still accurate.
    (iii) Except as expressly identified, the proposed conditions of 
use are identical to the conditions of use EPA approved for the 
preceding year.
    (iv) Any conditions or limitations on the eligibility for re-
certification identified in the preceding year's notice of approval of 
the emergency exemption have been satisfied.
    Applicants meeting the above requirements would not need to submit 
new, updated documentation that the emergency condition continues or 
the additional data elements generally required under 40 CFR 166.20, 
except that the interim report specified in 40 CFR 166.20(a)(11) would 
still be required where a re-certification is filed before the final 
report on the previous exemption is available.
    Eligibility for re-certifying the emergency condition would not 
determine whether an emergency exemption application could be approved. 
For applications that are eligible and include a proper re-
certification of the emergency condition, EPA would again determine 
whether the requested use poses a risk to human health or the 
environment that exceeds statutory and regulatory standards. If the 
risks posed by the requested use are determined to be unacceptable, the 
exemption request would be denied unless the risks could be mitigated. 
Where an application re-certifies that the emergency condition and 
requested use are the same as in the initial year of the exemption, EPA 
would only re-evaluate the situation to determine, relative to the 
first year, whether: (1) Any alternative products have been newly 
registered for the use; (2) any changes have occurred in the status of 
the chemical's risk assessment; (3) the requested conditions of use 
have changed; and, (4) the pesticide for the requested use has made 
sufficient progress towards registration. If an effective product has 
been registered for the requested use since the previous exemption was 
approved, then an emergency condition may no longer exist. If the 
Agency has received new risk information since approving the previous 
exemption, then the risk would be re-evaluated. Likewise, if the 
request includes any change in the conditions of use that may increase 
exposure (application rate, number of applications, type of 
application, pre-harvest interval, re-entry interval, total number of 
acres, and all other directions for use) then the risk would also be 
re-evaluated. Because some applicants may start their 3-year re-
certification period in later years than others, it is possible that 
EPA may determine that sufficient progress towards registration has not 
been made for a pesticide requested by an applicant eligible for re-
certification.
    For eligible requests where the applicant has certified a 
continuing emergency, if the three remaining review factors (product 
registrations, risk assessment status, and requested conditions of use) 
have not changed, the Agency's review time is expected to be 
significantly reduced. In such cases, applicants are expected to 
benefit by expedited decisions, in addition to the reduced burden due 
to the certification of the emergency. Applicants would be permitted to 
modify the conditions of the emergency use in an application in which 
they re-certify the emergency. However, EPA would need to determine 
whether, and how, such changes impact exposure and risk to human health 
or the environment. Therefore, such changes may undercut the Agency's 
ability to make an expedited decision. If the conditions of use are the 
same as the conditions of use in the exemption approved by EPA in the 
previous year, applicants may include a separate certification that 
their requested conditions of use have not changed, and incorporate by 
reference all conditions of use submitted in a previous application or 
applications. This certification that the conditions of use are 
unchanged would aid in expediting the Agency's decision.
    If the Agency determines that there has been insufficient progress 
towards registration of the requested chemical on the requested crop, a 
request could be denied, consistent with current regulations and 
practice, regardless of eligibility for submitting a re-

[[Page 53871]]

certification application. Registrant progress toward registration is 
determined for a pesticide-crop combination, whereas the year-count 
(first, second, third) in the eligibility cycle for re-certification 
would be determined separately for each State/Federal applicant, and 
could often differ among section 18 applicants in a given year. Lack of 
progress towards registration would not cause denials during the first 
3 years of exemptions for a chemical-crop combination. However, since 
some applicants may apply for the first time in a year subsequent to 
the first request for a chemical-crop combination by another applicant, 
lack of progress towards registration could potentially interrupt the 
eligibility cycle for some applicants.
    It is EPA's view that section 18 applies to non-routine conditions, 
and thus the Agency does not expect to re-approve emergency exemptions 
indefinitely. Under this proposal EPA would not allow submission of re-
certification applications where exemptions have been previously 
granted for 3 or more years. As provided in 40 CFR 166.25(b)(2)(ii), an 
applicant for an emergency exemption for a use that has been subject to 
an emergency exemption in 3 previous years will be required to 
demonstrate reasonable progress towards registering the product for the 
use, as part of a full application.
    3. Why propose this change? Allowing applicants for certain 
eligible exemption requests to re-certify the existence of an ongoing 
emergency condition and to incorporate by reference all information 
submitted in a previous application is expected to reduce the burden to 
both applicants and EPA as well as allow for quicker decisions. When an 
applicant certifies the continuation of the emergency condition and 
incorporates previously submitted materials by reference, a complete 
new application sufficient to characterize the situation in accordance 
with 40 CFR 166.20 will not be required. This will save applicants time 
and effort in gathering data and preparing their submissions. The 
Agency will save time and resources by not having to annually repeat 
each step of its review of the documents supporting the exemption 
requests. If no pesticides that could avert the emergency have been 
newly registered, and nothing has changed to affect the assessment of 
risk, then re-certification of an emergency will lead to significantly 
shorter Agency review.
    EPA's experience indicates that emergency situations that continue 
after the initial year generally are projected to cause comparable 
yield losses in succeeding years. Therefore, with the certification of 
a continuing emergency, reliance on the previously submitted data and 
other supporting information should be adequate to support a decision 
to approve or deny an emergency exemption application.

B. Determining and Documenting ``Significant Economic Loss''

    1. What is our current practice? In determining whether a pest 
emergency is likely to result in ``significant economic loss,'' EPA 
ordinarily compares the affected growers' projected per-acre 
``profits'' (gross revenue less expenses, where expenses have often 
been poorly defined) for the affected crop, based on anticipated yield 
losses, to the historical variation in their ``profits'' for that crop 
in that region. Applicants are required under 40 CFR 166.20(b)(4) to 
submit economic information necessary to make this determination. In 
addition to information used to estimate the amount of the anticipated 
yield and profit losses, EPA generally asks for annual data for 5 years 
of average yields, prices, and production costs to establish profit 
variability.
    Under the current approach, EPA and applicants estimate expected 
net revenues under the emergency conditions and compare them to the 
variation in annual profitability during the previous 5 years. If the 
expected net revenues under the emergency are less than the smallest 
net revenues of the previous 5 years, then the Agency would typically 
conclude that a significant economic loss will occur. Some crops have 
very wide fluctuations in net revenues (that in many cases are the 
result of market forces entirely unrelated to pest pressure). For such 
crops, growers may experience a large economic loss due to non-routine 
pest-related conditions, without a significant economic loss finding by 
EPA under strict adherence to the current approach. Other crops may 
have very little variation in historical net revenues, which could lead 
to a very small economic loss being found significant under the current 
approach.
    2. How would the proposed approach work? This second proposed 
improvement would focus EPA's analysis on the economic impact of the 
pest emergency relative to yields and/or revenues without the pest 
emergency, rather than comparing it to historical profit variation for 
the crop and region. Moreover, the new approach would allow applicants 
to document economic losses with a less burdensome methodology where 
appropriate.
    The proposed loss-based approach would use the existing methodology 
to calculate the economic consequences of an unusual pest outbreak, 
although the calculation would be done in steps (tiers) and sometimes 
the later steps would be unnecessary. States would still have to submit 
data to demonstrate the emergency nature of the outbreak including the 
expected losses in quantity, and sometimes quality and/or additional 
production costs. However, the proposed approach would impose standard 
criteria for determining the significance of that loss, rather than 
comparing losses to past variations in revenue or profit. The goal of 
the criteria is to compare losses to farm or firm income in the absence 
of the emergency in a manner that can be easily and consistently 
measured. Further, successive screening levels (tiers) have been chosen 
that will permit situations that clearly qualify to be resolved 
quickly, with a minimum of data. Each tier has a quantitative threshold 
that would generally apply to all eligible emergency exemption 
applications. If the pest situation does not appear likely to result in 
a significant economic loss based on the first tier analysis, it might 
qualify based on further analysis in succeeding tiers. Each additional 
tier would require more data and involve more analysis on how the 
emergency affects revenues. Where conditions do not neatly fit into the 
tiered approach, for example long-term losses in orchard crops, the 
Agency would make its significant economic loss determinations based on 
other criteria, such as changes in the net present value of an orchard, 
if these losses are demonstrated by the applicant.
    Tier 1: Yield loss. Tier 1 is based on crop yield loss. If the 
projected yield loss due to the emergency condition is sufficiently 
large, EPA would conclude that a significant economic loss will occur, 
due to the magnitude of the expected revenue loss. The yield loss 
threshold in Tier 1 would be 20% for all crops. This threshold is set 
at a sufficiently high level such that a loss that exceeded the 
threshold would also meet the thresholds in Tiers 2 and 3, if the 
additional economic data were submitted and analyzed. Therefore, for 
such large yield losses it would not be necessary to separately 
estimate economic loss, which would require detailed economic data.
    Tier 2: Economic loss as a percentage of gross revenues. A yield 
loss that does not satisfy the threshold in Tier 1 may nonetheless 
cause a significant economic loss because yield loss alone may not 
reflect all economic losses. In addition to yield losses, there may be 
other impacts that contribute to economic loss. Quality losses may 
result

[[Page 53872]]

in reductions in prices received and/or there may be changes in 
production costs, such as pest control costs and harvesting costs. For 
situations with yield losses that do not meet the significant economic 
loss criterion for Tier 1, EPA would evaluate estimates of economic 
loss as a percent of gross revenue in Tier 2, to determine if the loss 
meets that threshold for a significant economic loss. The economic loss 
threshold in Tier 2 would be 20% of gross revenue for all crops. Again, 
this threshold in Tier 2 is set with the intention that losses 
exceeding the threshold would also meet the threshold in Tier 3, if the 
additional Tier 3 analysis were performed.
    Tier 3: Economic loss as a percentage of net revenues. If neither 
yield or economic losses were above the required thresholds in Tiers 1 
and 2, EPA would compare impacts to net revenues. Net revenues are 
defined for the purposes of this proposed rule as gross revenues minus 
operating costs. The loss threshold in Tier 3 would be 50% of net 
revenues for all crops. Some emergency conditions that would fall short 
of the thresholds in Tiers 1 and 2 may qualify as a significant 
economic loss in Tier 3, particularly for crops with narrow profit 
margins (net revenues as a percentage of gross revenues). Even if 
economic loss seems small in comparison to gross revenues, the 
situation could still be a significant economic loss if the profit 
margin is narrow.
    EPA selected the sizes of the proposed thresholds (20%, 20%, and 
50%) based on average farm income and production expenses in the U.S., 
and an analysis of past requests showing what results the proposed 
method would provide with various thresholds. Data on farm income in 
``USDA Agricultural Statistics, 2003'' shows that net farm income 
averages about 20% of gross revenue. Therefore, an economic loss of 20% 
of gross revenue would be sufficient to eliminate net farm income. A 
yield loss of 20% results in economic loss of 20% or higher. Also, 
since average net farm income is a little less than 50% of net revenue, 
an economic loss that is 50% of net revenue would be sufficient to 
eliminate net farm income. The analysis of past requests indicated that 
the average and median economic losses that qualified as a significant 
economic loss were about 18% and 15% of gross revenue, respectively. 
Since the first 2 tiers are screening thresholds, these thresholds were 
rounded up to 20% to be a little more stringent, with the intention 
that if a request did not pass Tiers 1 or 2, it could qualify with Tier 
3. The analysis of past requests also showed that the median economic 
loss that qualified as a significant economic loss was about 51% of net 
revenue. The analysis also showed that these thresholds collectively 
result in about the same overall likelihood of an application 
qualifying for a significant economic loss. That is, approximately the 
same total number of emergency requests that qualified for a 
significant economic loss using the current approach would qualify 
using the proposed loss-based approach, although there would be some 
differences in individual cases.
    The regulatory revisions in this proposed rule include the 
quantitative thresholds for the three tiers, presented above, as this 
is EPA's preferred approach. Commenters are asked to consider whether 
the actual thresholds should be included in the revised regulations, or 
whether more flexibility should be preserved to refine that aspect of 
the proposed approach in the future. Commenters should also consider 
whether the levels of the proposed thresholds are appropriate, and if 
not, what the levels should be and why.
    For specific emergency exemptions (the only ones in which 
significant economic loss is a qualifying factor), EPA anticipates that 
applicants would first determine whether their projected loss meets the 
Tier 1 yield loss threshold of 40 CFR 166.3(h)(1)(i), analytically the 
least burdensome criterion. The associated data requirements are 
proposed in 40 CFR 166.20(b)(4)(i). If the projected loss does not meet 
this threshold, EPA expects that applicants would determine whether 
their projected loss meets the Tier 2 gross revenue threshold of 40 CFR 
166.3(h)(1)(ii), providing additional data as noted in 40 CFR 166 
20(b)(4)(ii). Failing to meet that threshold, applicants would submit 
the data to perform the analysis necessary for the Tier 3 net revenue 
threshold of 40 CFR 166.3(h)(1)(iii) as given in 40 CFR 
166.20(b)(4)(iii). The three tiers established in 40 CFR 
166.3(h)(1)(i), (ii) and (iii) are designed such that when an emergency 
condition qualifies for significant economic loss under a lower tier, 
data for higher tiers are not required, and the burden and cost of 
preparing the emergency exemption application are reduced. Each 
successive tier builds upon the previous one. That is, the information 
required for estimating a lower tier is also necessary in estimating 
each higher tier. This would allow an applicant to collect data, and 
build a case for significant economic loss, as needed and determined by 
the conditions, without requiring additional unnecessary data.
    This loss-based approach is designed to capture the economic impact 
of pest activity as it affects the current growing season, which will 
be sufficient for most emergency exemption applications. Although the 
loss-based approach appears in a proposed revision to the definition of 
significant economic loss at 40 CFR 166.3(h)(1), EPA is not attempting 
to revise the approach for other types of losses, at the proposed 40 
CFR 166.3(h)(2). Where losses affect more than the current growing 
season, for example long-term losses in orchard crops, the Agency would 
continue to make its significant economic loss determinations based on 
other criteria, such as changes in the net present value of an orchard, 
if these losses are demonstrated by the applicant. In situations where 
the simple methods of the loss-based approach would not adequately 
reflect the likely extent of the economic loss, EPA would still attempt 
to determine, on a case-by-case basis, whether the pest emergency is 
likely to result in a substantial loss or impairment of capital assets, 
or a loss that would affect the long-term financial viability expected 
from the productive activity.
    3. Why propose this change? This proposed methodology for 
determining a significant economic loss is intended to streamline the 
data and analytical requirements for emergency exemption requests, and 
allow for quicker decisions by EPA. In addition, the methodology is 
designed to reflect more accurately the significance of an anticipated 
economic loss. Specifically, this approach makes a more direct 
comparison between the losses anticipated owing to the emergency 
situation and the yield and/or revenues without the pest emergency, 
rather than a comparison to the historical range of profit variability. 
Year-to-year profit variability often reflects market forces entirely 
unrelated to pest pressure. Although EPA has attempted to make 
allowances for crops' differing profit variability when determining the 
economic significance of losses under the current approach, EPA now 
believes that the loss-based approach better and more directly permits 
EPA to evaluate the significance of economic losses.
    An analysis of past section 18 requests suggests that this proposed 
approach would not cause a significant change in the overall likelihood 
of a significant economic loss finding, although findings may differ in 
individual cases. Further, it is expected to lead to savings to both 
applicants and EPA from reduced data and analytical burdens. Under the 
proposed procedure, applicants could elect to submit the

[[Page 53873]]

minimum amount of data necessary to demonstrate a significant economic 
loss in one of three increasingly refined tiers. If the first tier is 
sufficient, the burden is reduced most significantly. Even in the 
highest tier, the burden may be reduced relative to the current 
approach as the analysis focuses on the current year rather than 
historical data. Like re-certification of emergencies, this would save 
applicants time and resources in gathering data and preparing 
submissions. The Agency's burden would be reduced due to streamlined 
reviews.
    An analysis of available past requests for emergency exemptions 
submitted by States, including requests for which significant losses 
were not found, shows that in many cases significant economic loss can 
be adequately demonstrated in a more flexible manner without loss of 
reliability through the proposed methodology. The loss-based approach 
would require less data from applicants in cases that qualify under 
Tier 1, where the same conclusion of a significant economic loss would 
be made with the additional data and analysis under the higher tiers.
    Because the proposed approach shifts the focus from annual price 
variability to actual pest-related losses, while still considering 
typical net revenues for the crop and State, it leads to more 
consistently accurate findings of the significance of economic losses. 
Under the current approach, producers of crops that have very wide 
fluctuations in net revenues, even if due to price variability, may 
experience a large economic loss due to non-routine pest-related 
conditions, without a significant economic loss finding by EPA under 
strict adherence to the current approach. Other crops and cases may 
have very little variation in historical net revenues, which could lead 
to a small economic loss being found significant under the current 
approach. Again, the proposed approach is designed so that it would not 
cause a significant change in the overall likelihood of a significant 
economic loss finding, but it may change the findings in individual 
cases so that determinations of significance are more accurate, 
appropriate and equitable.
    Current regulations list certain information that must be included, 
as appropriate, in an application for a specific exemption: 40 CFR 
166.20(b) Information required for a specific exemption. An application 
for a specific exemption shall provide all of the following 
information, as appropriate, concerning the nature of the emergency:
    (4) A discussion of the anticipated significant economic loss, 
together with data and other information supporting the discussion, 
which addresses all of the following:
    (i) Historical net and gross revenues for the site;
    (ii) The estimated net and gross revenues for the site without 
the use of the proposed pesticide; and
    (iii) The estimated net and gross revenues for the site with use 
of the proposed pesticide.

    The existing regulations state that all of the above information 
must be included ``as appropriate.'' EPA recognizes that each pest 
emergency has individual characteristics, and exercises judgement based 
on experience, in determining what information is appropriate. For 
example, under the current approach, the Agency typically considers 5 
years of annual data on historical net and gross revenues to be 
appropriate, and has suggested in guidance materials that applicants 
submit revenue data for the preceding 5 years. However, in some cases, 
such as a very minor or new crop for which less data are available, the 
Agency may rely on other credible information. Further, EPA does not 
compare the emergency situation to the situation with the proposed 
pesticide, but to the situation without the emergency. Therefore, EPA 
believes that the proposed approach would allow applicants to focus 
their applications on the most ``appropriate'' information for 
determining whether or not a significant economic loss will occur.
    Because the analysis of past exemption requests, on which the 
proposed approach is based, demonstrates that the likelihood of 
approval of some requests is not significantly changed by the loss-
based approach, EPA believes that the current requirement of those 
additional data in those cases can be improved. However, even when 
annual historical data are not required, applicants would sometimes 
continue to utilize historical data under the proposed approach, albeit 
in a different way. This is because each tier requires a quantitative 
threshold to be met, that is a certain percentage of a baseline of 
either crop yield, gross revenues, or net revenues. The best approach 
to determine the baseline in some cases may be to use the average of 
historical data, including yield and price data.

VI. Proposed Minor Updates and Revisions

A. Specifying Invasive Species as Targets under Quarantine Exemptions

    Current regulations describe four types of exemptions, one of which 
is a quarantine exemption. The purpose of a quarantine exemption is 
stated in the regulations as follows:
40 CFR 166.2(b) Quarantine exemption
    A quarantine exemption may be authorized in an emergency 
condition to control the introduction or spread of any pest new to 
or not theretofore known to be widely prevalent or distributed 
within and throughout the United States and its territories.

    Quarantine exemptions are not directly for the purpose of, or 
approved on the basis of, averting a significant economic loss, 
although they may ultimately help prevent large economic losses. In 
addition to being for the control of pests that are not widely 
prevalent or distributed in the U.S., quarantine exemptions are 
intended to control recently-introduced, non-native species. In recent 
years such species have come to be commonly known as ``invasive 
species.'' Because of the potentially widespread and devastating 
impacts of invasive species to ecosystems, the environment, and the 
economy, the challenge of preventing their introduction, and when 
necessary controlling them, has garnered increasing attention in recent 
years. Although invasive species implicitly fall within the scope of 
quarantine exemptions, the now widely-recognized term does not appear 
in the regulations, probably because it was not widely used at the time 
40 CFR part 166 was promulgated. EPA is proposing to add the term 
``invasive species'' to 40 CFR 166.2(b) and to 166.3(d)(3)(i), to 
clarify that the intent of making quarantine exemptions available 
includes the control of invasive species. EPA also proposes to add, at 
40 CFR 166.3(k), a definition of ``invasive species'' that is derived 
from that used in Executive Order 13112 (64 FR 6183, February 3, 1999).

B. Updating Administrative and Communication Processes

    A number of minor revisions to 40 CFR part 166 are being proposed 
to correct errors or update administrative aspects of the emergency 
exemption regulations, particularly in light of the fact that FQPA was 
enacted since the regulations under part 166 were last revised. Each of 
these revisions is being proposed for one of the following reasons: (1) 
To correct typographical or administrative errors or inaccuracies, (2) 
to bring the regulations into agreement with current requirements put 
in place by the FQPA, or (3) to reflect improvements to the process 
that have been identified since 40 CFR part 166 was last revised, and 
that have been voluntarily practiced by applicants. Each of these 
revisions would be non-substantive or reflect minor changes to

[[Page 53874]]

the regulatory requirements, but all would correct, improve, or update 
the regulations. The corrections of typographical or administrative 
errors or inaccuracies are self-explanatory. The proposed revisions for 
the other reasons are discussed below.
    Under FFDCA section 408(l)(6), as amended by FQPA, EPA is required 
to establish time-limited tolerances, or exemptions from the 
requirement of a tolerance, for pesticide residues in food or feed 
resulting from uses under emergency exemptions. The current regulations 
predate FQPA and therefore do not reflect this requirement. Four 
revisions are being proposed to bring 40 CFR part 166 into agreement 
with current practices as required by the FFDCA. Inasmuch as section 
408(l)(6) applies to all food-use emergency exemptions, regardless of 
whether its requirements are reflected in 40 CFR part 166, these 
proposed changes to 40 CFR part 166 do not substantively change the 
applicable law. For ease of discussion, below, ``tolerance'' is used to 
refer to a tolerance or exemption from the requirement of a tolerance.
    First, EPA proposes to amend 40 CFR 166.3(e) to revise the 
definition of ``first food use,'' which reads ``The term first food use 
refers to the use of a pesticide on a food or in a manner which 
otherwise would be expected to result in residues in a food, if no 
permanent tolerance, exemption from the requirement of a tolerance, or 
food additive regulation for residues of the pesticide on any food has 
been established for the pesticide under section 408(d) or (e) or 409 
of the Federal Food, Drug, and Cosmetic Act.'' EPA is proposing to 
change this definition by removing the word ``permanent,'' so that the 
establishment of any tolerance, including a time-limited tolerance, 
would be considered when determining whether a use was the first food 
use, and by removing the reference to ``food additive regulation,'' 
because, owing to the FQPA amendments, EPA no longer issues food 
additive regulations.
    Second, under 40 CFR 166.25, Agency review, the regulations state 
that the review enables EPA to make a determination with respect to 
several items, including in 40 CFR 166.25(a)(2) the level of residues 
in or on all food resulting from the proposed use. The proposed 
revision would add to this list the establishment of a time-limited 
tolerance for such residues, where necessary.
    The third proposed revision made necessary by FQPA is to add, under 
40 CFR 166.40, an additional limitation to the authority of a State to 
issue a crisis exemption, namely, that a State may issue a crisis 
exemption for a food use only where a tolerance or exemption is already 
in effect, or where EPA has provided verbal confirmation that a time-
limited tolerance for the proposed use can be established in a timely 
manner. It is in the best interests of applicants and potential users 
of the pesticide under the crisis exemption that there is some 
assurance that an exemption can be established in a timely manner 
before use of the pesticide begins. EPA also proposes that all crisis 
exemptions be conditioned upon EPA confirming that it has no other 
risk-based objection to the use of the pesticide under the crisis 
provisions.
    The fourth proposed change, which arises because EPA now 
establishes formal tolerances under FQPA, is to remove the requirement 
under 40 CFR 166.30(b) and 40 CFR 166.47 to directly notify the U.S. 
Food and Drug Administration (FDA), the U.S. Department of Agriculture 
(USDA), and the State health officials. The purpose of this requirement 
was to notify these agencies of levels of pesticides that may occur in 
food and feed items as a result of an emergency exemption use. However, 
with the requirement that time-limited tolerances be established in 
accordance with FFDCA section 408(l)(6), such levels are published in 
the Federal Register, as well as the 40 CFR part 180, and detailed 
background is given regarding safety of these tolerances. Therefore, 
notifying the other regulatory organizations (FDA, USDA, and State 
health officials) on an individual basis is considered redundant to the 
Federal Register notice and incorporation of the regulatory decision in 
the appropriate section of 40 CFR part 180.
    Several proposed revisions are to codify minor improvements to the 
process that have been identified since the current regulations became 
effective. Applicants have been generally following these practices, in 
most cases for several years, and EPA believes that the public will 
generally agree that these are improvements to the regulatory 
requirements. First, under 40 CFR 166.20, Application for a specific, 
quarantine, or public health exemption, EPA is proposing to revise 40 
CFR 166.20(a)(2)(i)(A) so that an application must include a copy of 
the registered label(s) if a specific pesticide product(s) is/are 
requested, instead of the current requirement to include the 
registration number and name of the product. This is practical because 
emergency exemption requests are generally for pesticide products that 
are already registered for other uses, but not for the requested use.
    Next, under 40 CFR 166.20(a)(3), EPA is proposing to add a new item 
and revise several of the others, to specify that the conditions of use 
in an application must state the maximum number of applications, the 
period of time for which the use is proposed, and to specify the 
earliest possible harvest dates of the treated crop. Such information 
is clearly necessary for both risk assessment and tolerance setting, 
and in those rare occasions where it is not apparent from the 
application, EPA must contact the applicant to obtain the information. 
Expressly requiring this information in 40 CFR 166.20(a)(3) would 
expedite review of applications and allow tolerances to be established 
in a timely fashion.
    Additionally, EPA is proposing that 40 CFR 166.20(a)(9) be revised 
to specify that in addition to the registrant or manufacturer being 
notified of the application submission, the application must also 
include a statement of support from the registrant or manufacturer, and 
the expectation that supplies of the requested material will be 
adequate to meet the needs under the proposed emergency use.
    The existing regulations establish a measure of whether adequate 
progress toward the registration of a requested use is being made. 
Existing regulations suggest that the lack of a request for 
registration, within 3 years of an emergency exemption first being 
requested for the use, suggests that adequate progress is not being 
made. EPA proposes to revise 40 CFR 166.24(a)(6)(i) and 40 CFR 
166.25(b)(2)(ii) to relax this presumption for repeat emergency 
exemption applications for uses being supported by the Interregional 
Research Project No. 4 (IR-4). The IR-4 program is a cooperative effort 
of the state land grant universities, USDA and EPA, to address the 
chronic shortage of pest control options for minor crops. Generally, 
the crop protection industry lacks economic incentive to pursue 
registrations on minor crops because of low acreage. IR-4 generates and 
supplies research data needed by EPA in order to register compounds for 
use on minor crops. Owing to the limited pest control options available 
for minor use crops, the significance of the need evidenced by IR-4 
action, and the limits on IR-4 resources, EPA believes that a somewhat 
slower rate of progress towards registration should be accepted for 
emergency exemptions for uses being supported by the IR-4 program. 
Accordingly, EPA is proposing that 40 CFR 166.24(a)(6)(i) and 40 CFR

[[Page 53875]]

166.25(b)(2)(ii) be revised so that the presumption against adequate 
progress toward registration of repeat emergency exemptions for uses 
being supported by the IR-4 program would begin after 5 years, 2 years 
more than allowed for uses supported by the registrant. For such major 
crop uses, the 3-year presumption in the current regulations would 
remain in effect.
    EPA is proposing that 40 CFR 166.30(a)(1) be revised to reflect 
that EPA will not process incomplete applications, and that action on 
such submissions will be halted until required additional information 
is submitted.
    EPA is proposing to clarify 40 CFR 166.32(b) to ensure that 
applicants submit interim use reports for exemptions if requesting a 
repeated emergency exemption prior to the due date of the final report.
    EPA proposes clarifying the authority of an applicant to issue a 
crisis exemption by specifying in 40 CFR 166.40(a) that crisis 
exemptions are to be used only for unpredictable emergency conditions. 
This proposed change is strictly for purposes of clarification, as the 
term ``unpredictable'' already appears in the introductory language of 
40 CFR 166.40, and does not represent any intention by EPA to change 
the circumstances that are acceptable for crisis exemptions.
    EPA is proposing that 40 CFR 166.43(a)(1) be revised to improve the 
notification process for crisis exemptions, reflect the standard 
practice of the state agencies, and provide for advance notice so that 
EPA may make a determination of whether a tolerance may be supported in 
accordance with FFDCA section 408 requirements. EPA is proposing that 
40 CFR 166.43(a)(1) be revised to require advance notification for 
crisis exemptions by applicants. The state's authority to exercise the 
crisis exemption would be stayed for up to 36 hours pending verbal 
confirmation by EPA that a tolerance can be established in a timely 
manner and that the Agency has no other risk-based objections. This 
would replace the currently ambiguous requirement that notification 
must be made at least 36 hours in advance, or no later than 24 hours 
after the decision of a State to avail itself of a crisis exemption. 
Notification after the crisis has been declared does not allow EPA to 
evaluate whether a crisis use can be supported with a section 408 
safety finding, or whether other potential risks are unacceptable, 
before use of the pesticide begins. In any case, EPA would continue to 
provide the necessary verbal confirmations as quickly as possible, 
thereby often allowing use of the crisis exemption in less than 36 
hours. The Agency recognizes that speed is important for all crisis 
exemptions, and that certain situations may be particularly urgent, 
including, but not necessarily limited to, national security threats 
and some requests under USDA's Animal and Plant Health Inspection 
Service quarantine program.
    To clarify necessary information for a crisis exemption, EPA is 
proposing that 40 CFR 166.43(b)(1) and (b)(4), be revised to specify 
submission of the registered label(s) for the pesticide product(s) 
proposed for crisis use, as well as proposed use directions specific to 
the crisis use, and the timeframe for anticipated use, including end 
date.
    To bring the reporting requirements for crisis exemption requests 
into agreement with those for specific, quarantine, and public health 
exemption requests, EPA is proposing that 40 CFR 166.49(a)(1) through 
(a)(4) be revised and 40 CFR 166.49(a)(5) deleted, to clarify 
information requirements, such as applicant, product used, site 
treated, and contact information.

VII. EPA Plans for Resistance Management and Endangered Species 
Considerations

A. Revised Plans for Addressing Resistance Management

    The EPA-USDA Committee to Advise on Reassessment and Transition 
(CARAT) is a diverse group of stakeholders formed to make 
recommendations to EPA and USDA regarding strategic approaches for pest 
management planning, transition to safer pesticides for agriculture, 
and tolerance reassessment for pesticides. In October 2003, CARAT 
provided draft recommendations, including one that ``EPA and USDA need 
to recognize that any transition program has to consider efficacy, 
economics, resistance management, and impact on non-targets.'' EPA 
agrees with the CARAT on the importance of resistance management and is 
exploring how to use its regulatory and non-regulatory initiatives to 
support and facilitate effective resistance management.
    Although the April 2003 Federal Register Notice indicated that EPA 
was considering addressing resistance management in this proposed rule, 
EPA now plans to pursue opportunities to address pest resistance 
management as it implements the Pesticide Registration Improvement Act 
(PRIA) enacted January 23, 2004. This Act requires the Agency to 
establish a registration service fee system for applications for 
pesticide registration and amended registration. Under this new system, 
fees will be charged for new applications for registration received on 
or after the effective date of the statute (March 23, 2004) and EPA is 
required to make a decision on the application within prescribed 
decision timeframes. Under PRIA, EPA will eliminate its backlog of 
registration actions and make more timely decisions. This will 
accelerate the registration of many products that will be beneficial to 
resistance management, including reduced risk products. EPA's reduced 
risk process considers resistance management as an important factor. 
New products that would address significant resistance management needs 
would reach the market sooner, thereby providing a strong incentive to 
registrants to incorporate resistance management in their registration 
submissions.
    In addition, EPA will continue to promote the implementation of its 
voluntary resistance management labeling guidelines based on rotation 
of mode of action described in Pesticide Registration Notice 2001-5 (PR 
Notice 2001-5). These guidelines are part of a North American Free 
Trade Agreement (NAFTA) effort to harmonize resistance management 
guidelines. The Agency supports incorporating resistance management 
considerations into pesticide labeling (i.e., PR Notice 2001-5), 
resistance management education programs, crop management and 
stewardship programs, and outreach efforts with stakeholders. EPA will 
continue working with stakeholder groups on sustainable resistance 
management strategies that protect human health and the environment 
including the various Resistance Action Committees (RACs), registrants, 
consultants, academia, USDA, States, and public interest groups.

B. Protections for Endangered Species

    Like all federal agencies, EPA must comply with the requirements of 
the Endangered Species Act (ESA), which requires that an agency ensure, 
in consultation with the U.S. Fish and Wildlife Service (FWS) and the 
National Marine Fisheries Service (NMFS) (jointly referred to as ``the 
Services''), that its actions are not likely to jeopardize the 
continued existence of threatened or endangered (listed) species or 
destroy or adversely modify their critical habitat. This requirement 
applies, among others, to EPA actions approving emergency exemptions 
under FIFRA section 18. Under current ESA consultation regulations, an 
agency must consult with FWS and NMFS if an

[[Page 53876]]

action ``may affect'' a listed species or its critical habitat.
    FWS and NMFS, in collaboration with EPA and USDA, have developed a 
counterpart regulation (69 FR 48115, August 6, 2004), that would make 
the process of consultation about EPA actions involving pesticides more 
efficient, effective, and timely, thereby strengthening the protections 
for endangered and threatened species. As part of the work supporting 
the counterpart rule, the Services and EPA reviewed the Agency's 
approach to the assessment of potential risks to listed species 
resulting from pesticide use. A January 26, 2004, letter from the 
Services to EPA includes a quote stating that EPA's approach to 
ecological risk assessment ``will produce effects determinations that 
reliably assess the effects of pesticides on . . . listed species and 
critical habitat pursuant to the ESA and implementing regulations.'' 
That letter is in the public docket for this proposed rule, and 
interested parties may access it by following the instructions under 
ADDRESSES.
    As a result of the Services' review of the Agency's ecological risk 
assessment methodology, EPA intends to look more closely at potential 
risks of pesticide use in connection with decisions on requests for 
emergency exemptions. EPA currently requires, under 40 CFR 
166.20(a)(7), information to be included in applications for emergency 
exemption that addresses potential risks of the requested use to 
endangered and threatened species. Although EPA, under existing 
requirements, routinely considers the impacts of emergency exemptions 
on endangered and threatened species, the Agency seeks to improve the 
guidance it gives to applicants concerning data on endangered and 
threatened species. EPA will need to rely on States and federal 
agencies to supply information as part of their requests for emergency 
exemptions that will enable EPA to assess the potential impacts on 
listed species and critical habitat of pesticide use under the proposed 
exemption. EPA also plans to work with the Association of American Pest 
Control Officials (AAPCO) and with individual States, as the primary 
applicants for emergency exemptions, to improve the quality of their 
submissions as they try to frame the potential impact of a requested 
pesticide use on endangered and threatened species. EPA believes these 
measures fall within existing requirements but should increase the 
availability of essential information needed to make a timely and 
substantive determination of the potential impact to endangered and 
threatened species. EPA also plans through its reevaluation, to refocus 
and possibly increase consideration of these impacts in its decision 
process for exemption requests, including any need to consult with 
USFWS and NMFS.

VIII. FIFRA Review Requirements

    In accordance with FIFRA section 25(a), this proposed rule was 
submitted to the FIFRA Science Advisory Panel (SAP), the Secretary of 
Agriculture (USDA), and appropriate Congressional Committees. The SAP 
has waived its review of this proposed rule, and no comments were 
received from any of the Congressional Committees or USDA.

IX. Statutory and Executive Order Reviews

A. Executive Order 12866

    Pursuant to Executive Order 12866, entitled Regulatory Planning and 
Review (58 FR 51735, October 4, 1993), the Office of Management and 
Budget (OMB) has designated this proposed rule as a ``significant 
regulatory action'' under section 3(f) of the Executive Order because 
it may raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
the Executive Order. This action was therefore submitted to OMB for 
review under this Executive Order, and any changes to this document 
made at the suggestion of OMB have been documented in the public docket 
for this rulemaking.
    In addition, EPA has prepared an economic analysis of the potential 
regulatory impacts of this proposed action on those affected, which is 
contained in a document entitled Economic Analysis of the Proposed 
Pesticides Emergency Exemption Process Revisions. A copy of this 
Economic Analysis is available in the public docket for this action and 
is briefly summarized here.
    EPA is considering these improvements in an effort to reduce the 
burden to both the applicants and EPA, and to allow for quicker 
decisions by the Agency, while maintaining health and safety 
requirements. As such, this proposed action is not expected to cause 
any significant adverse economic impacts if implemented as proposed. 
This proposed action would only potentially affect Federal, State, or 
Territorial government agencies that can petition EPA for an emergency 
use authorization under FIFRA section 18. It would therefore have no 
direct impacts on local governments, small entities, pesticide 
producers or on government entities that may be registrants of 
pesticide products, and would have no direct impacts on any other 
sector of the economy.
    The only significant impacts expected would be burden reductions to 
States and Federal agencies in the application process for emergency 
exemptions, and to EPA in the review process, as well as quicker 
responses to emergency conditions. As detailed in the economic analysis 
prepared for this proposed rule, based on predicted future applications 
affected by the proposed revisions, EPA estimates the annual combined 
savings for applicants and EPA of around $0.94 million, a little over 
$0.6 million from re-certification, and about $0.33 million from 
changing to the loss-based method of determining significant economic 
loss.

B. Paperwork Reduction Act

    This action does not impose any new information collection burden 
that would require additional approval by OMB under the Paperwork 
Reduction Act (PRA), 44 U.S.C. 3501 et seq. This proposed rule is 
expected to reduce the existing burden that is approved under OMB 
Control No. 2070-0032 (EPA ICR No. 596), which covers the information 
collection activities contained in the existing regulations at 40 CFR 
part 166, and under the pilot program announced April 23, 2003 (68 FR 
20145). A copy of the OMB approved Information Collection Request (ICR) 
has been placed in the public docket for this rulemaking, and the 
Agency's estimated burden reduction is presented in the economic 
analysis that has been prepared for this proposed rule.
    Under the PRA, ``burden'' means the total time, effort, or 
financial resources expended by persons to generate, maintain, retain, 
or disclose or provide information to or for a Federal agency. This 
includes the time needed to review instructions; develop, acquire, 
install, and utilize technology and systems for the purposes of 
collecting, validating, and verifying information, processing and 
maintaining information, and disclosing and providing information; 
adjust the existing ways to comply with any previously applicable 
instructions and requirements; train personnel to be able to respond to 
a collection of information; search data sources; complete and review 
the collection of information; and transmit or otherwise disclose the 
information.
    An agency may not conduct or sponsor, and a person is not required 
to respond to an information collection request unless it displays a 
currently valid OMB control number. The OMB control numbers for EPA's 
regulations in 40 CFR, after appearing in the preamble of the final 
rule, are listed in

[[Page 53877]]

40 CFR part 9 and included on any related collection instrument (e.g., 
form or survey).
    Submit any comments on the Agency's need for this information, the 
accuracy of the provided burden estimates, and any suggested methods 
for minimizing respondent burden, including the use of automated 
collection techniques, along with your comments on the proposed rule. 
The Agency will consider any comments related to the information 
collection requirements contained in this proposed rule as it develops 
a final rule. Any changes to the burden estimate for the ICR will be 
effectuated with the final rule.

C. Regulatory Flexibility Act

    Pursuant to section 605(b) of the Regulatory Flexibility Act (RFA), 
5 U.S.C. 601 et seq., the Agency hereby certifies that this proposed 
rule will not have a significant adverse economic impact on a 
substantial number of small entities. This action will only directly 
impact State and Federal agencies, neither of which qualify as a small 
entity under the RFA. This proposed rule does not have any direct 
adverse impacts on small businesses, small non-profit organizations, or 
small local governments. Section 18 only applies to Federal and State 
governments.

D. Unfunded Mandates Reform Act

    Under Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) 
(Public Law 104-4), EPA has determined that this action does not 
contain a Federal mandate that may result in expenditures of $100 
million or more for State, local, and tribal governments, in the 
aggregate, or the private sector in any 1 year. This proposed rule only 
applies to Federal and State government agencies, the only entities 
that can petition the EPA under FIFRA section 18. As described in Unit 
IX.A., this proposed rule is expected to result in an overall reduction 
of existing costs for applicants and EPA of around $0.94 million. As 
such, this action will not impact local or tribal governments or the 
private sector, and will not significantly or uniquely affect small 
governments. Accordingly, this rule is not subject to the requirements 
of sections 202, 203, 204, and 205 of UMRA.

E. Executive Order 13132

    Pursuant to Executive Order 13132, entitled Federalism (64 FR 
43255, August 10, 1999), EPA has determined that this proposed rule 
does not have ``federalism implications,'' because it will not have 
substantial direct effects on the states, on the relationship between 
the national government and the states, or on the distribution of power 
and responsibilities among the various levels of government, as 
specified in the Order. As indicated above, this proposed rule is 
expected to reduce burden on Federal and State government agencies that 
petition EPA under FIFRA section 18, and on EPA in processing the 
applications. Thus, Executive Order 13132 does not apply to this 
proposed rule. In the spirit of the Order, and consistent with EPA 
policy to promote communications between the Agency and State 
governments, EPA has specifically solicited comment from State 
officials.

F. Executive Order 13175

    As required by Executive Order 13175, entitled Consultation and 
Coordination with Indian Tribal Governments (65 FR 67249, November 6, 
2000), EPA has determined that this proposed rule does not have tribal 
implications because it will not have any affect on tribal governments, 
on the relationship between the Federal government and the Indian 
tribes, or on the distribution of power and responsibilities between 
the Federal government and Indian tribes, as specified in the Order. As 
indicated above, this proposed rule only applies to State and Federal 
government agencies. FIFRA section 18 does not apply to tribal 
governments. Thus, Executive Order 13175 does not apply to this 
proposed rule.

G. Executive Order 13211

    This proposed rule is not subject to Executive Order 13211, Actions 
Concerning Regulations that Significantly Affect Energy Supply, 
Distribution, or Use (66 FR 28355, May 22, 2001) because it is not 
designated as an ``economically significant'' regulatory action as 
defined by Executive Order 12866 (see Unit XI.A.), nor is it likely to 
have any significant adverse effect on the supply, distribution, or use 
of energy.

H. Executive Order 13045

    Executive Order 13045, entitled Protection of Children from 
Environmental Health Risks and Safety Risks (62 FR 19885, April 23, 
1997) does not apply to this proposed rule because this action is not 
designated as an ``economically significant'' regulatory action as 
defined by Executive Order 12866 (see Unit XI.A.), nor does it 
establish an environmental standard, or otherwise have a 
disproportionate effect on children.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTAA), (15 U.S.C. 272 note) directs EPA to use voluntary 
consensus standards in its regulatory activities unless to do so would 
be inconsistent with applicable law or impractical. Voluntary consensus 
standards are technical standards (e.g., materials specifications, test 
methods, and sampling procedures) that are developed or adopted by 
voluntary consensus standards bodies. This proposed rule does not 
impose any technical standards that would require EPA to consider any 
voluntary consensus standards.

J. Executive Order 12898

    This proposed rule does not have an adverse impact on the 
environmental and health conditions in low-income and minority 
communities. Therefore, under Executive Order 12898, entitled Federal 
Actions to Address Environmental Justice in Minority Populations and 
Low-Income Populations (59 FR 7629, February 16, 1994), the Agency has 
not considered environmental justice-related issues.

List of Subjects in 40 CFR Part 166

    Environmental protection, Emergency exemptions, Pesticides and 
pests.


    Dated: August 25, 2004.
Michael O. Leavitt,
Administrator.
    Therefore, it is proposed that 40 CFR chapter I be amended as 
follows:

PART 166--[AMENDED]

    1. The authority citation for part 166 would continue to read as 
follows:

    Authority: 7 U.S.C. 136-136y.

    2. Section 166.2 is amended by revising paragraph (b) to read as 
follows:


Sec.  166.2  Types of exemptions.

* * * * *
    (b) Quarantine exemption. A quarantine exemption may be authorized 
in an emergency condition to control the introduction or spread of any 
pest that is an invasive species, or is otherwise new to or not 
theretofore known to be widely prevalent or distributed within and 
throughout the United States and its territories.
* * * * *
    3. Section 166.3 is amended by revising paragraphs (a), (d)(3)(i), 
(e), (h), and adding paragraphs (k) and (l) to read as follows:

[[Page 53878]]

Sec.  166.3  Definitions.

* * * * *
    (a) The term the Act means the Federal Insecticide, Fungicide, and 
Rodenticide Act, as amended, 7 U.S.C. 136 et seq.
* * * * *
    (d) * * *
    (3) * * *
    (i) Involves the introduction or dissemination of an invasive 
species or a pest new to or not theretofore known to be widely 
prevalent or distributed within or throughout the United States and its 
territories; or
* * * * *
    (e) The term first food use refers to the use of a pesticide on a 
food or in a manner which otherwise would be expected to result in 
residues in a food, if no tolerance or exemption from the requirement 
of a tolerance for residues of the pesticide on any food has been 
established for the pesticide under section 408(b)(2) and (c)(2) of the 
Federal Food, Drug, and Cosmetic Act.
* * * * *
    (h) The term significant economic loss means that, compared to the 
situation without the pest emergency and despite the best efforts of 
the affected persons, the emergency conditions at the specific use site 
identified in the application are reasonably expected to cause losses 
meeting any of the following criteria:
    (1) For pest activity that primarily affects the current crop, one 
or more of the following:
    (i) Crop yield loss greater than or equal to 20%;
    (ii) Economic loss, including revenue losses and cost increases, 
greater than or equal to 20% of gross revenues;
    (iii) Economic loss, including revenue losses and cost increases, 
greater than or equal to 50% of net revenues;
    (2) For all other pest activity, substantial loss or impairment of 
capital assets, or a loss that would affect the long-term financial 
viability expected from the productive activity.
* * * * *
    (k) The term invasive species means, with respect to a particular 
ecosystem, any species that is not native to that ecosystem, and whose 
introduction does or is likely to cause economic or environmental harm 
or harm to human health.
    (l) The term IR-4 program refers to the Interregional Research 
Project No. 4, which is a cooperative effort of the state land grant 
universities, the U.S. Department of Agriculture (USDA) and EPA, to 
address the chronic shortage of pest control options for minor crops, 
which are generally of too small an acreage to provide economic 
incentive for registration by the crop protection industry.
    4. Section 166.20 is amended by revising paragraphs (a)(2)(i)(A), 
(a)(3), (a)(9), (b)(4), and adding paragraph (b)(5) to read as follows:


Sec.  166.20  Application for a specific, quarantine, or public health 
exemption.

    (a) * * *
    (2) * * *
    (i) * * *
    (A) A copy of the label(s) if a specific product(s) is/are 
requested; or the formulation(s) requested if a specific product is not 
desired; and
* * * * *
    (3) Desciption of the proposed use. The application shall identify 
all of the following:
    (i) Sites to be treated, including their locations within the 
State;
    (ii) The method of application;
    (iii) The rate of application in terms of active ingredient and 
product;
    (iv) The maximum number of applications;
    (v) The total acreage or other appropriate unit proposed to be 
treated;
    (vi) The total amount of pesticide proposed to be used in terms of 
both active ingredient and product;
    (vii) All applicable restrictions and requirements concerning the 
proposed use which may not appear on labeling;
    (viii) The duration of the proposed use; and
    (ix) Earliest possible harvest dates.
* * * * *
    (9) Acknowledgment by registrant. The application shall contain a 
statement by the registrants of all pesticide products proposed for use 
acknowledging that a request has been made to the Agency for use of the 
pesticide under this section. This acknowledgment shall include a 
statement of support for the requested use, including the expected 
availability of adequate quantities of the requested product under the 
use scenario proposed by the applicant(s); and the status of the 
registration in regard to the requested use including appropriate 
petition numbers, or of the registrant's intentions regarding the 
registration of the use.
* * * * *
    (b) * * *
    (4) A discussion of the anticipated significant economic loss, 
together with data and other information supporting the discussion, 
that addresses one or more of the following, as appropriate:
    (i) Crop yield or utilized yield reasonably anticipated in the 
absence of the emergency and expected losses in quantity due to the 
emergency;
    (ii) The information in paragraph (b)(4)(i) of this section plus 
prices reasonably anticipated in the absence of the emergency and 
changes in prices and/or production costs due to the emergency;
    (iii) The information in paragraph (b)(4)(ii) of this section plus 
operating costs reasonably anticipated in the absence of the emergency;
    (iv) Any other information explaining the economic consequences of 
the emergency.
    (5) Re-certification of an emergency condition. Applicants for 
specific exemptions for which the emergency condition could reasonably 
be expected to continue for longer than 1 year, and for which the 
exemption was granted for the same pesticide at the same site to the 
same applicant the previous year, but no more than twice, may submit 
less information by basing such application on previously submitted 
information. For applications for such exemptions, except for 
applications subject to public notice pursuant to Sec.  166.24(a)(1) 
through (a)(5), the information requirements of paragraphs (a)(1) 
through (a)(10) of this section, and of paragraphs (b)(1) through 
(b)(4) of this section, shall not apply where the applicant certifies 
that all of the following are true:
    (i) The emergency condition described in the preceding year's 
application continues to exist;
    (ii) Except as expressly identified, all information submitted in 
the preceding year's application is still accurate;
    (iii) Except as expressly identified, the proposed conditions of 
use are identical to the conditions of use EPA approved for the 
preceding year;
    (iv) Any conditions or limitations on the eligibility for re-
certification identified in the preceding year's notice of approval of 
the emergency exemption have been satisfied.
* * * * *
    5. Section 166.24 is amended by revising the introductory text of 
paragraph (a) and (a)(6)(i) to read as follows:


Sec.  166.24  Public notice of receipt of application and opportunity 
for public comment.

    (a) Publication requirement. The Administrator shall issue a notice 
of receipt in the Federal Register for a specific, quarantine, or 
public health exemption and request public comment when any one of the 
following criteria is met:
* * * * *
    (6) * * *
    (i) An emergency exemption has been requested or approved for that 
use in

[[Page 53879]]

any 3 previous years, or any 5 previous years if the use is supported 
by the IR-4 program, and
* * * * *
    6. Section 166.25 is amended by revising paragraphs (a)(2), (a)(4), 
and (b)(2)(ii) to read as follows:


Sec.  166.25  Agency review.

    (a) * * *
    (2) The Agency's ability and intention to establish a time-limited 
tolerance(s) or exemption(s) from the requirement of a tolerance for 
any pesticide residues resulting from the authorized use, identifying 
the level of permissible residues in or on food or feed resulting from 
the proposed use;
* * * * *
    (4) The potential risks to human health, endangered or threatened 
species, beneficial organisms, and the environment from the proposed 
use.
    (b) * * *
    (2) * * *
    (ii) The progress which has been made toward registration of the 
proposed use, if a repeated specific or public health exemption is 
sought. It shall be presumed that if a complete application for 
registration of a use, which has been under a specific or public health 
exemption for any 3 previous years, or any 5 previous years if the use 
is supported for registration by the IR-4 program, has not been 
submitted, reasonable progress towards registration has not been made.
    7. Section 166.30 is amended by revising paragraph (a)(1), removing 
paragraph (b), and redesignating existing paragraph (c) as paragraph 
(b).


Sec.  166.30  Notice of Agency decision.

    (a) * * *
    (1) Incomplete applications. The Agency may discontinue the 
processing of any application that does not address all of the 
requirements of Sec.  166.20 until such time the additional information 
is submitted by the applicant.
* * * * *
    8. Section 166.32 is amended by revising the introductory text of 
paragraph (b) to read as follows:


Sec.  166.32  Reporting and recordkeeping requirements for specific, 
quarantine, and public health exemptions.

* * * * *
    (b) Interim and final reports. A final report summarizing the 
results of pesticide use under any specific, quarantine, or public 
health exemption must be submitted to the Agency within 6 months from 
the expiration of the exemption unless otherwise specified by the 
Agency. For quarantine exemptions granted for longer than 1 year, 
interim reports must be submitted annually. When an application for 
renewal of the exemption is submitted before the expiration of the 
exemption or before submission of the final report, an interim report 
must be submitted with the application. The information in interim and 
final reports shall include all of the following:
* * * * *
    9. Section 166.40 is amended by revising paragraph (a), removing 
the period at the end of paragraph (b) and adding a semi-colon and the 
word ``and'' at the end of paragraph (b), and adding paragraph (c) to 
read as follows:


Sec.  166.40  Authorization.

* * * * *
    (a) An unpredictable emergency condition exists;
* * * * *
    (c) EPA has provided verbal confirmation that, for food uses, a 
tolerance or exemption from the requirement of a tolerance can be 
established in a timely manner, responsive to the projected timeframe 
of use of the chemical and harvest of the commodity, and that, for any 
use, the Agency has no other risk-based objection.
    10. Section 166.43 is amended by revising paragraphs (a)(1) and (b) 
to read as follows:


Sec.  166.43  Notice to EPA and registrants or basic manufacturers.

    (a) * * * (1) The State or Federal Agency issuing the crisis 
exemption must notify the Administrator, and receive verbal 
confirmation from EPA required in Sec.  166.40(c), in advance of 
utilization of the crisis provisions. EPA will attempt to provide such 
confirmation as quickly as possible, but shall notify the applicant of 
its determination within 36 hours.
* * * * *
    (b) Contents of notice. Information required to be provided in 
notices shall include all of the following:
    (1) The name of the product and active ingredient authorized for 
use, along with the common name and CAS number if available, including 
a copy of the EPA registered label and use directions appropriate to 
the authorized use;
    (2) The site on which the pesticide is to be used or is being used;
    (3) The use pattern;
    (4) The date on which the pesticide use is to begin and the date 
when the use will end;
    (5) An estimate of the level of residues of the pesticide expected 
to result from use under the crisis exemption;
    (6) Earliest anticipated harvest date of the treated commodity;
    (7) Description of the emergency situation; and
    (8) Any other pertinent information available at the time.

Sec.  166.47--[Removed]

    11. Section 166.47 is removed.
    12. Section 166.49 is amended by revising paragraph (a) to read as 
follows:


Sec. 166.49  Public notice of crisis exemptions.

    (a) Periodic notices. At least quarterly, the Administrator shall 
issue a notice in the Federal Register announcing issuance of crisis 
exemptions. The notice shall contain all of the following:
    (1) The name of the applicant;
    (2) The pesticide authorized for use;
    (3) The crop or site to be treated; and
    (4) The name, address, and telephone number of a person in the 
Agency who can provide further information.
* * * * *

[FR Doc. 04-20038 Filed 9-2-04; 8:45 am]
BILLING CODE 6560-50-S