[Federal Register Volume 70, Number 45 (Wednesday, March 9, 2005)]
[Notices]
[Pages 11662-11666]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-4590]


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FEDERAL TRADE COMMISSION


Agency Information Collection Activities; Proposed Collection; 
Comment Request; Extension

AGENCY: Federal Trade Commission (``Commission'' or ``FTC'').

ACTION: Notice.

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SUMMARY: The information collection requirements described below will 
be submitted to the Office of Management and Budget (``OMB'') for 
review, as required by the Paperwork Reduction Act (``PRA'') (44 U.S.C. 
3501-3520). The FTC is seeking public comments on its proposal to 
extend through June 30, 2008, the current Paperwork Reduction Act 
clearances for information collection requirements contained in three 
Commission Rules. Those clearances expire on June 30, 2005.

DATES: Comments must be submitted on or before May 9, 2005.

ADDRESSES: Interested parties are invited to submit written comments. 
Comments should refer to ``Paperwork Comment: FTC File No. P822108'' to 
facilitate the organization of comments. A comment filed in paper form 
should include this reference both in the text and on the envelope and 
should be mailed or delivered to the following address: Federal Trade 
Commission/Office of the Secretary, Room H-159 (Annex X), 600 
Pennsylvania Avenue, NW., Washington, DC 20580. The FTC is requesting 
that any comment filed in paper form be sent by courier or overnight 
service, if possible, because U.S. postal mail in the Washington area 
and at the Commission is subject to delay due to heightened security 
precautions. Alternatively, comments may be filed in electronic form 
(in ASCII format, WordPerfect, or Microsoft Word) as part of or as an 
attachment to e-mail messages directed to the following e-mail box: 
[email protected]. If the comment contains any material for 
which confidential treatment is requested, it must be filed in paper 
form, and the first page of the document must be clearly labeled 
``Confidential.'' \1\
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    \1\ Commission Rule 4.2(d), 16 CFR 4.2(d). The comment must be 
accompanied by an explicit request for confidential treatment, 
including the factual and legal basis for the request, and must 
identify the specific portions of the comment to be withheld from 
the public record. The request will be granted or denied by the 
Commission's General Counsel, consistent with applicable law and the 
public interest. See Commission Rule 4.9(c), 16 CFR 4.9(c).
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    The FTC Act and other laws the Commission administers permit the 
collection of public comments to consider and use in this proceeding as 
appropriate. All timely and responsive public comments will be 
considered by the Commission and will be available to the public on the 
FTC Web site, to the extent practicable, at http://www.ftc.gov. As a 
matter of discretion, the FTC makes every effort to remove home contact 
information for individuals from the public comments it receives before 
placing those comments on the FTC Web site. More information, including 
routine uses permitted by the Privacy Act, may be found in the FTC's 
privacy policy at http://www.ftc.gov/ftc/privacy.htm.

FOR FURTHER INFORMATION CONTACT: Requests for additional information or 
copies of the proposed information requirements for the Funeral 
Industry Practices Rule (``Funeral Rule'') should be addressed to 
Catherine Harrington-McBride, Attorney, Division of Marketing 
Practices, Bureau of Consumer Protection, Federal Trade Commission, 
Room H-238, 600 Pennsylvania Ave., NW., Washington, DC 20580, (202) 
326-2452. Requests for additional information or copies of the proposed 
information requirements for the Children's Online Privacy Protection 
Act Rule (``COPPA Rule'') should be addressed to Rona Kelner, (202) 
326-2752, or Karen Muoio, (202) 326-2491, Federal Trade Commission, 
Bureau of Consumer Protection, Division of Advertising Practices, 600 
Pennsylvania Ave., NW., Mail Drop NJ-3212, Washington, DC 20580. 
Requests for additional information or copies of the proposed 
information requirements for the Gramm-Leach-Bliley Act Privacy Rule 
(``GLBA Rule'') should be addressed to Laura Berger, Attorney, Division 
of Financial Practices, Bureau of Consumer Protection, Federal Trade 
Commission, Room S-4429, 601 Pennsylvania Ave., NW., Washington, DC 
20580, (202) 326-3224.

SUPPLEMENTARY INFORMATION: Under the PRA, Federal agencies must obtain 
approval from OMB for each collection of information they conduct or 
sponsor. ``Collection of information'' means agency requests or 
requirements that members of the public submit reports, keep records, 
or provide information to a third party. 44 U.S.C. 3502(3), 5 CFR 
1320.3(c). As required by section 3506(c)(2)(A) of the PRA, the FTC is 
providing this opportunity for public comment before requesting that 
OMB extend the existing paperwork clearance for the Funeral Rule, 16 
CFR part 453 (OMB Control Number 3084-0025); the COPPA Rule, 16 CFR 
part 312 (OMB Control Number 3084-0117); and the GLBA Rule, 16 CFR part 
313 (OMB Control Number 3084-0121).
    The FTC invites comments on: (1) Whether the proposed collection of 
information is necessary for the proper performance of the functions of 
the agency, including whether the information will have practical 
utility; (2) the accuracy of the agency's estimate of the burden of the 
proposed collection of information, including the validity of the 
methodology and assumptions used; (3) ways to enhance the quality, 
utility, and clarity of the information to be collected; and (4) ways 
to minimize the burden of the collection of information on those who 
are to respond, including through the use of appropriate automated, 
electronic, mechanical, or other technological collection techniques or 
other forms of information technology, e.g., permitting electronic 
submission of responses.

1. The Funeral Rule, 16 CFR Part 453 (OMB Control Number 3084-0025)

    The Funeral Rule ensures that consumers who are purchasing funeral 
goods and services have accurate information about the terms and 
conditions (especially prices) for such goods and services. The Rule 
requires that funeral providers disclose this information to consumers 
and maintain records to facilitate enforcement of the Rule. The PRA 
clearance for the Funeral Rule was scheduled to expire on March 31, 
2005. On February 7, 2005, the OMB granted the FTC's request for a 
short-term extension to June 30, 2005, to allow for this opportunity 
for public comment.
    The estimated burden associated with the collection of information 
required by the Rule is 21,500 hours for recordkeeping, 104,545 hours 
for disclosures, and 43,000 hours for training, for a total of 169,000 
hours (rounded to the nearest thousand). This estimate is based on the 
number of funeral providers (approximately 21,500),\2\ the number of 
funerals

[[Page 11663]]

annually (approximately 2.4 million),\3\ and the time needed to fulfill 
the information collection tasks required by the Rule. The methodology 
followed in deriving burden estimates for the existing clearance is 
detailed in an April 11, 2002, Federal Register Notice that responded 
to a comment by the National Funeral Directors Association (``NFDA'') 
regarding the FTC's 2001 request for an extension of the clearance. See 
67 FR 17691.
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    \2\ The estimated number of funeral providers is from data 
provided on the National Funeral Directors Association (``NFDA'') 
Web site (http://www.nfda.org), which was accessed in January 2005.
    \3\ The estimated number of funerals annually is taken from the 
National Center for Health Statistics, http://www.cdc.gov/nchs/. 
According to NCHS, 2,443,387 deaths occurred in the United States in 
2002, the most recent year for which final data is available. See 
National Vital Statistics Reports, vol. 53, no. 5 ``Deaths: Final 
Data for 2002,'' available at http://www.cdc.gov/nchs/data/nvsr/nvsr53/nvsr53_05acc.pdf.
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    Recordkeeping: The Rule requires that funeral providers retain 
copies of price lists and statements of funeral goods and services 
selected by consumers. Based on a maximum average burden of one hour 
per provider per year for this task, the total burden for the 21,500 
providers is 21,500 hours. This estimate is lower than FTC staff's 2002 
estimate of 22,300 hours due to a decrease in the number of funeral 
providers.
    Disclosure: The Rule requires that funeral providers: (1) Maintain 
current price lists for funeral goods and services, (2) provide written 
documentation of the funeral goods and services selected by consumers 
making funeral arrangements, and (3) provide information about funeral 
prices in response to telephone inquiries.
    1. Maintaining current price lists requires that funeral providers 
revise their price lists from time to time throughout the year to 
reflect price changes. Staff estimates, consistent with its current 
clearance, that this task requires a maximum average burden of two and 
one-half hours per provider per year for this task. Thus, the total 
burden for 21,500 providers is 53,750 hours.
    2. Staff retains its 2002 estimate that 13% of funeral providers 
prepare written documentation of funeral goods and services selected by 
consumers specifically due to the Rule's mandate. The original 
rulemaking record indicated that 87% of funeral providers provided 
written documentation of funeral arrangements, even absent the Rule's 
requirements.\4\ The NFDA's 2002 comment indicates that even before the 
Rule became effective, nearly every funeral home already had been 
providing consumers with some kind of final statement in writing. NFDA 
stated that likely only the timing of the statement's issuance had 
changed as a result of the Rule. Nonetheless, staff believes it prudent 
to err, if at all, on the side of overestimating the burden imposed by 
the Rule.
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    \4\ The original version of the Funeral Rule required that 
funeral providers retain a copy of and give each customer a separate 
``Statement of Funeral Goods and Services Selected.'' The 1994 
amendments to the Rule eliminated that requirement, allowing instead 
for such disclosures to be incorporated into a written contract, 
bill of sale, or other record of a transaction that providers use to 
memorialize sales agreements with customers.
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    According to the rulemaking record, these providers are typically 
the smallest funeral homes. The written documentation requirement can 
be satisfied through the use of a standard form (an example of which 
the FTC has provided to all funeral providers in its compliance 
guide).\5\ Based on an estimate that these smaller funeral homes 
arrange, on average, approximately twenty funerals per year and that it 
would take each of them about three minutes to record prices for each 
consumer on the standard form, FTC staff estimates that the total 
burden associated with the written documentation requirement is one 
hour per provider not already in compliance, for a total of 2,795 hours 
[(21,500 funeral providers x 13%) x (20 statements per year x 3 minutes 
per statement)].
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    \5\ The FTC has provided its compliance guide to all funeral 
providers at no cost, and additional copies are available on the FTC 
Web site, http://www.ftc.gov, or by mail.
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    3. The Funeral Rule also requires funeral providers to answer 
telephone inquiries about the provider's offerings or prices. Industry 
data indicate that only about 12% of funeral purchasers make telephone 
inquiries, with each call lasting an estimated ten minutes. Thus, 
assuming that the average purchaser who makes telephone inquiries 
places one call per funeral to determine prices, the estimated burden 
is 48,000 hours (2.4 million funerals per year x 12% x 10 minutes per 
inquiry), a slight increase over the 46,000 hours estimated by staff in 
2002 due to the increase in the number of funerals per year. This 
burden likely will decline over time as consumers increasingly rely on 
the Internet for funeral price information.
    In sum, the burden due to the Rule's disclosure requirements totals 
104,545 hours (53,750 + 2,795 + 48,000).
    Training: In addition to the recordkeeping and disclosure-related 
tasks noted above, funeral homes may also have training requirements 
specifically attributable to the Rule. While staff believes that annual 
training burdens associated with the Rule should be minimal because 
Rule compliance is generally included in continuing education 
requirements for licensing and voluntary certification programs, staff 
estimates that, industry-wide, funeral homes should incur no more than 
43,000 hours related to training specific to the Rule each year. This 
estimate is consistent with staff's assumption for the current 
clearance that an ``average'' funeral home consists of approximately 
five employees (full-time and part-time employment combined), but with 
no more than four of them having tasks specifically associated with the 
Funeral Rule. Staff retains its estimate that each of the four 
employees (three directors and a clerical employee) per firm would each 
require one-half hour, at most, per year, for such training. Thus, 
total estimated time for training is 43,000 hours (4 employees per firm 
x \1/2\ hour x 21,500 providers).
    Estimated annual cost burden: $4,882,000, rounded to the nearest 
thousand ($3,654,000 in labor costs and $1,228,000 in non-labor costs).
    Labor costs: Labor costs are derived by applying appropriate hourly 
cost figures to the burden hours described above. The hourly rates used 
below are averages.
    Clerical personnel, at an hourly rate of $13, can perform the 
recordkeeping tasks required under the Rule. Based on the estimated 
hour burden of 21,500 hours, the estimated cost burden for 
recordkeeping is $279,500 ($13 per hour x 21,500 hours).
    The two and one-half hours required of each provider, on average, 
to update price lists should consist of approximately one and one-half 
hours of managerial or professional time, at $27.50 per hour, and one 
hour of clerical time, at $13 per hour, for a total of $54.25 per 
provider \6\ [($27.50 per hour x 1.5 hours) + ($13.00 per hour x 1 
hour)]. Thus, the estimated total cost burden for maintaining price 
lists is $1,166,375 ($54.25 per provider x 21,500 providers).
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    \6\ National Compensation Survey: Occupational Wages in the 
United States, July 2003, U.S. Department of Labor, Bureau of Labor 
Statistics (Aug. 2004) (``BLS National Compensation Survey'') 
(citing the mean hourly earnings for funeral directors as $21.30/
hour), available at http://www.bls.gov/ncs/ocs/sp/ncbl0636.pdf. As 
in the past, staff has increased this figure on the assumption that 
the owner or managing director, who would be paid at a slightly 
higher rate, would be responsible for making pricing decisions.
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    The cost of providing written documentation of the goods and 
services selected by the consumer is 2,795 hours of managerial or 
professional time at approximately $27.50 per hour, or $76,862.50 
(2,795 hours x $27.50 per hour).

[[Page 11664]]

    The cost of responding to telephone inquiries about offerings or 
prices is 48,000 hours of managerial or professional time at $27.50 per 
hour, or $1,320,000 (48,000 hours x $27.50 per hour).
    The cost of training licensed and non-licensed funeral home staff 
to comply with the Funeral Rule is two hours per funeral home, with 
four employees of varying ranks each spending one-half hour on 
training. Consistent with estimates in the current clearance, the 
Commission is assuming that three funeral directors, at hourly wages of 
$27.50, $20, and $15, respectively, as well as one clerical or 
administrative staff member, at $13 per hour, require such training, 
for a total burden of 43,000 hours (21,500 funeral homes x 2 hours 
total per establishment), and $811,625 [($27.50 + $20 + $15 + $13) x 
\1/2\ hour per employee x 21,500 funeral homes].
    The total labor cost of the three disclosure requirements imposed 
by the Funeral Rule is $2,563,237.50 ($1,166,375 + $76,862.50 + 
$1,320,000). The total labor cost for recordkeeping is $279,500. The 
total labor cost for disclosures, recordkeeping and training is 
$3,654,000 ($279,500 for recordkeeping + $811,625 for training + 
$2,563,237.50 for disclosures), rounded to the nearest thousand.
    Capital or other non-labor costs: The Rule imposes minimal capital 
costs and no current start-up costs. The Rule first took effect in 1984 
and the revised Rule took effect in 1994, so funeral providers should 
already have in place capital equipment to carry out tasks associated 
with Rule compliance. Moreover, most funeral homes already have access, 
for other business purposes, to the ordinary office equipment needed 
for compliance, so the Rule likely imposes minimal additional capital 
expense.
    Compliance with the Rule, however, does entail some expense to 
funeral providers for printing and duplication of price lists. Assuming 
that two price lists per funeral/cremation are created by industry to 
adhere to the Rule, 4,800,000 copies per year are made for a total cost 
of $1,200,000 (2,400,000 funerals per year x 2 copies per funeral x 
$.25 per copy). In addition, the estimated 2,795 providers not already 
providing written documentation of funeral arrangements apart from the 
Rule will incur additional printing and copying costs. Assuming that 
those providers use the standard two-page form shown in the Compliance 
Guide, at twenty-five cents per page, at an average of twenty funerals 
per year, the added cost burden would be $27,950 (2,795 providers x 20 
funerals per year x 2 pages per funeral x $.25). Thus, estimated non-
labor costs are $1,228,000, rounded to the nearest thousand.

2. The COPPA Rule, 16 CFR Part 312 (OMB Control Number 3084-0117)

    The COPPA Rule prohibits unfair and deceptive acts and practices in 
connection with the collection and use of personally identifiable 
information from and about children on the Internet.
    Estimated annual hours burden: 2000 hours (rounded to the nearest 
thousand).
    Disclosure Requirements: 1800 hours.
    The COPPA Rule contains certain statutorily-required notice 
requirements, which constitute a ``collection of information'' under 
the PRA:
    (a) the Rule requires each Web site and online service operator 
directed to children, and any Web site or online service operator with 
actual knowledge that it is collecting personal information from 
children, to provide notice of how it collects, uses, and discloses 
such information and, with exceptions, to obtain the prior consent of 
the child's parent in order to engage in such collection, use, and 
disclosure;
    (b) the Rule requires the operator to provide the parent with 
notice of the specific types of personal information being collected 
from the child, to give the parent the opportunity to forbid the 
operator at any time from further collecting, using, or maintaining 
such information, and to provide reasonable means for the parent to 
obtain the information;
    (c) The Rule prohibits a child's participation in a game, a prize 
offer, or other activity from being conditioned on the child's 
disclosure of more personal information than is ``reasonably 
necessary'' for the child to participate in that activity; and
    (d) The Rule requires Web site and online service operators to 
establish procedures that protect the confidentiality, security, and 
integrity of personal information collected from children.
    After consulting with the COPPA safe harbor programs and industry 
groups, the FTC staff retains its earlier estimate that roughly thirty 
new Web entrants each year will fall within the Rule's coverage. Web 
site operators that have previously created or adjusted their sites to 
comply with the Rule will incur no further burden associated with the 
Rule, unless they opt to change their policies and information 
collection in ways that will further invoke the Rule's provisions. 
Moreover, the staff believes that existing COPPA-compliant operators 
who introduce additional sites beyond those they already have created 
will incur minimal, if any, incremental PRA burden. This is because 
such operators already have been through the start-up phase and can 
carry over the results of that to the new sites they create.
    Staff also retains its prior estimate that on average, new entrants 
will spend approximately sixty hours crafting a privacy policy, 
designing a mechanism to provide the required notice, and posting it 
online. Accordingly, the staff estimates that complying with the Rule's 
disclosure requirements will require approximately 1,800 hours (30 new 
Web entrants x 60 hours per entrant). Consistent with prior estimates, 
FTC staff estimates that the time spent on compliance would be 
apportioned five to one between legal (lawyers or similar 
professionals) and technical (computer programmers) personnel. The 
staff therefore estimates that lawyers or similar professionals who 
craft privacy policies will account for 1,500 of the 1,800 hours 
required. Computer programmers responsible for posting the policy will 
account for the remaining 300 hours.
    Voluntary Reporting Requirements for Safe Harbor Participants: 130 
hours.
    Operators can comply with the Rule by meeting the terms of industry 
self-regulatory guidelines that the Commission approves after notice 
and comment.\7\ While the submission of industry self-regulatory 
guidelines to the agency is voluntary, the Rule includes specific 
reporting requirements that all safe harbor applicants must provide to 
receive Commission approval.
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    \7\ See Section 312.10(c). Approved self-regulatory guidelines 
can be found on the FTC's Web site at http://www.ftc.gov/privacy/safeharbor/shp.htm.
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    FTC staff retains its estimate that it would require, on average, 
265 hours per new safe harbor program applicant to prepare and submit 
its safe harbor proposal in accordance with Section 312.12(c) of the 
Rule. Industry sources have confirmed recently that this estimate is 
reasonable and advised that all of this time would be attributable to 
the efforts of lawyers. Based on past experience and industry input, 
the staff believes that no more than one applicant every two years will 
submit a request. Thus, the burden attributable to this requirement 
would be approximately 130 hours per year (265 hours/2 years).
    The staff believes that most of the records submitted in connection 
with a safe harbor request would be records that marketing and online 
industry representatives have kept in the

[[Page 11665]]

ordinary course of business before the Rule was issued. Any incremental 
effort associated with maintaining the results of independent 
assessments under Section 312.10(d)(3) would also be in the normal 
course of business. Thus, in accordance with the regulations 
implementing the PRA, the burden estimate does not include effort 
expended for these activities. 5 CFR 1320.3(b)(2).
    Accordingly, the staff estimates that total hours per year for the 
disclosure requirements affecting new Web entrants and the reporting 
requirements for safe harbor applications would be approximately 2000 
hours (rounded to the nearest thousand).
    Labor costs: Labor costs are derived by applying appropriate hourly 
cost figures to the burden hours described above. The staff 
conservatively assumes hourly rates of $85 and $30, respectively, for 
lawyers or similar professionals and computer programmers.\8\ Based on 
these inputs, the staff further estimates that the associated annual 
labor costs for new entrants would be $136,500 [(1,500 hours x $85 per 
hour for legal) + (300 hours x $30 per hour for computer programmers)] 
and for safe harbor applicants would be $11,050 (130 hours per year x 
$85 per hour), for a total labor cost of $148,000 (rounded to the 
nearest thousand).
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    \8\ FTC staff estimates average legal costs at $85 hour, which 
is consistent with Commission experience with other information 
collection activities. The $30 estimate for computer programmers is 
based on the BLS National Compensation Survey, which indicates the 
mean hourly wage rate for computer programmers as $29.53.
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    Non-labor costs: Because Web sites will already be equipped with 
the computer equipment and software necessary to comply with the Rule's 
notice requirements, the sole costs incurred by the Web sites are the 
aforementioned estimated labor costs. Similarly, industry members 
should already have in place the means to retain and store the records 
that must be maintained under the Rule's safe harbor recordkeeping 
provisions, because they are likely to have been keeping these records 
independent of the Rule.

3. The GLBA Rule, 16 CFR Part 313 (OMB Control Number 3084-1021)

    The GLBA Rule is designed to ensure that customers and consumers, 
subject to certain exceptions, will have access to the privacy policies 
of the financial institutions with which they conduct business. As 
mandated by the GLBA, 15 U.S.C. 6801-6809, the Rule requires financial 
institutions to disclose to consumers: (1) Initial notice of the 
financial institution's privacy policy when establishing a customer 
relationship with a consumer and/or before sharing a consumer's non-
public personal information with certain nonaffiliated third parties; 
(2) notice of the consumer's right to opt out of information sharing 
with such parties; (3) annual notice of the institution's privacy 
policy to any continuing customer; and (4) notice of changes in the 
institution's practices on information sharing. These requirements are 
subject to the PRA. The Rule does not require recordkeeping.
    Estimated annual hours burden: As noted in the original burden 
estimate for the GLBA Rule, determining the paperwork burden of the 
Rule's disclosure requirements is very difficult because of the highly 
diverse group of affected entities, consisting of financial 
institutions not regulated by a Federal financial regulatory agency. 
See 15 U.S.C. 6805 (committing to the Commission's jurisdiction 
entities that are not specifically subject to another agency's 
jurisdiction).
    The burden estimates represent the FTC staff's best assessment, 
based on its knowledge and expertise relating to the financial 
institutions subject to the Commission's jurisdiction under this law. 
To derive these estimates, staff considered the wide variations in 
covered entities. In some instances, covered entities may make the 
required disclosures in the ordinary course of business, apart from the 
GLBA Rule. In addition, some entities may use highly automated means to 
provide the required disclosures, while others may rely on methods 
requiring more manual effort. The burden estimates shown below include 
the time that may be necessary to train staff to comply with the 
regulations. These figures are averages based on staff's best estimate 
of the burden incurred over the broad spectrum of covered entities.
    Staff retains its prior estimate of the number of entities each 
year that will address the GLBA Rule for the first time (5,000) and its 
estimate of established entities already familiar with the Rule 
(100,000). While the number of established entities familiar with the 
Rule would theoretically increase each year with the addition of new 
entrants, staff retain its previous estimate of established entities in 
consideration of the fact that a number of the established entities 
will close in any given year, and the difficulty of establishing a more 
precise estimate. Staff's burden estimates for new entrants and 
established entities are detailed in the charts below.
    Start-up hours and labor costs for new entities:

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                                                                                          Labor cost per
                                                Hourly wage and labor        Hours per      event* (per   Approx. number   Approx. total   Approx. total
                   Event                              category              respondent      respondent)   of respondents    annual hrs.     labor costs
                                                                                             (dollars)                                       (dollars)
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Reviewing internal policies and developing  $35.92 managerial/                        20         $718.40           5,000         100,000      $3,592,000
 GLBA-implementing instructions**.           professional.
Creating disclosure document or electronic  $13.77 clerical.............               5           68.85           5,000          25,000         344,250
 disclosure (including initial, annual,
 and opt out disclosures).
                                            $28.37 professional/                      10          283.70           5,000          50,000       1,418,500
                                             technical.
Disseminating initial disclosure            $13.77 clerical.............              15          206.55           5,000          75,000       1,032,750
 (including opt out notices).
                                            $28.37 professional/                      10          283.70           5,000          50,000       1,418,500
                                             technical.
 
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\*\ Staff calculated labor costs by applying appropriate hourly cost figures to burden hours. The hourly rates used were based on mean wages for
  managerial/professional time (e.g., compliance evaluation and/or planning), professional/technical time (e.g., designing and producing notices,
  reviewing and updating information systems), and clerical time (e.g., reproduction tasks, filing, and, where applicable to the given event, typing or
  mailing). See BLS National Compensation Survey, Table 3, available at http://www.bls.gov/ncs/ocs/sp/ncbl0635.pdf. Labor cost totals reflect solely
  that of the commercial entities affected. Staff assumes that the time required of consumers to respond affirmatively to respondents' opt-out programs
  (be it manually or electronically) would be minimal.

[[Page 11666]]

 
\**\ Reviewing instructions includes all efforts performed by or for the respondent to: determine whether and to what extent the respondent is covered
  by an agency collection of information, understand the nature of the request, and determine the appropriate response (including the creation and
  dissemination of document and/or electronic disclosures).

    Burden hours and costs for established entities:
    Burden for established entities already familiar with the Rule 
predictably would be less than for start-up entities because start-up 
costs, such as crafting a privacy policy, are generally one-time costs 
and have already been incurred. Staff's best estimate of the average 
burden for these entities is as follows:

----------------------------------------------------------------------------------------------------------------
                                                                  Approx. number                   Approx. total
            Event               Hourly wage and     Hours per           of         Approx. total    labor costs
                                labor  category   respondent\*\  respondents\**\   annual hours      (dollars)
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Reviewing GLBA-implementing    $35.72                         4           70,000         280,000     $10,001,600
 policies and practices.        managerial/
                                professional.
Disseminating annual           $13.77 clerical.              15           70,000       1,050,000      14,458,500
 disclosure.
                               $28.37                         5           70,000         350,000       9,929,500
                                professional/
                                technical.
Changes to privacy policies    $13.77 clerical.              15            1,000          15,000         206,550
 and related disclosures.
                               $28.37                         5            1,000           5,000         141,850
                                professional/
                                technical.
                                                                                 -----------------
    Total....................  ................  ..............  ...............       1,700,000     34,738,000
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\*\ Staff calculated labor costs by applying appropriate hourly cost figures to burden hours. The hourly wage
  rates used were based on mean wages for managerial/professional time (e.g., compliance evaluation and/or
  planning), skilled professional/technical time (e.g., designing and producing notices, reviewing and updating
  information systems), and clerical time (e.g., reproduction tasks, filing, and, where applicable to the given
  event, typing or mailing). (Bureau of Labor Statistics, Table 3, July 2003; http://www.bls.gov/ncs/ocs/sp/ncbl0635.pdf). Consumers have a continuing right to opt-out, as well as a right to revoke their opt-out at any
  time. When a respondent changes its information sharing practices, consumers are again given the opportunity
  to opt-out. Again, staff assumes that the time required of consumers to respond affirmatively to respondents'
  opt-out programs (be it manually or electronically) would be minimal.
\**\ The estimate of respondents is based on the following assumptions: (1) 100,000 respondents, approximately
  70% of whom maintain customer relationships exceeding one year, (2) no more than 1% (1,000) of whom make
  additional changes to privacy policies at any time other than the occasion of the annual notice; and (3) such
  changes will occur no more often than once per year.

    As calculated above, the total annual PRA burden for all affected 
entities in a given year would be 2,000,000 hours and $42,544,000.
    Estimated Capital/Other Non-Labor Costs Burden: Staff estimates 
that the capital or other non-labor costs associated with the document 
requests are minimal. Covered entities will already be equipped to 
provide written notices (e.g., computers with word processing programs, 
typewriters, copying machines, mailing capabilities). Most likely, only 
entities that already have on-line capabilities will offer consumers 
the choice to receive notices via electronic format. As such, these 
entities will already be equipped with the computer equipment and 
software necessary to disseminate the required disclosures via 
electronic means.

Christian S. White,
Acting General Counsel.
[FR Doc. 05-4590 Filed 3-8-05; 8:45 am]
BILLING CODE 6750-01-P