[Federal Register Volume 71, Number 18 (Friday, January 27, 2006)]
[Rules and Regulations]
[Pages 4495-4512]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-743]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 166

[EPA-HQ-OPP-2004-0038; FRL-7749-3]
RIN 2070-AD36


Pesticides; Emergency Exemption Process Revisions

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: This action revises the regulations governing emergency 
exemptions that allow unregistered uses of pesticides to address 
emergency pest conditions for a limited time. One change provides 
applicants for certain repeat exemptions a simple way to re-certify 
that the emergency conditions that qualified for an exemption in a 
previous year continue to exist. Another change revises the criteria 
for determining when a potential emergency condition is expected to 
cause a significant economic loss and revises the data requirements for 
documenting the loss. These revisions streamline and improve the 
application and review process by reducing the burden to both 
applicants and the Environmental Protection Agency (EPA, or ``the 
Agency''), allowing for potentially quicker decisions by the Agency, 
and providing for consistent and equitable determinations of 
``significant economic loss`` as the basis for an emergency. This 
action also includes several minor revisions to the regulations. None 
of these various improvements compromise protections for human health 
and the environment.

DATES: This final rule is effective on March 28, 2006.

ADDRESSES: EPA has established a docket for this action under docket 
identification (ID) number EPA-HQ-OPP-2004-0038. All documents in the 
docket are listed on the www.regulations.gov web site. (EDOCKET, EPA's 
electronic public docket and comment system was replaced on November 
25, 2005, by an enhanced federal-wide electronic docket management and 
comment system located at http://www.regulations.gov/). Follow the on-
line instructions. 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, 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). Potentially 
affected 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 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. 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/. An electronic version of 40 CFR part 166 is available at E-
CFR Beta Site Two at http://www.gpoaccess.gov/ecfr/.

II. Purpose

    The primary purpose of this rulemaking is to simplify the process 
of applying for emergency exemptions, and allow for potentially quicker 
responses to emergency pest conditions, without affecting current 
protections for human health and the environment. This action revises 
the regulations at 40 CFR part 166, to make a variety of improvements 
to the pesticide

[[Page 4496]]

emergency exemption program and process. The two most significant of 
the revised requirements are streamlining provisions intended to reduce 
the burden to both applicants and the Agency and to expedite decisions 
on some exemption requests. The first of these revisions expressly 
authorizes applicants for certain repeat exemptions to re-certify that 
an emergency condition continues in subsequent years, and to 
incorporate by reference all information submitted in a previous 
application rather than annually re-submit complete but perhaps 
redundant applications.
    The second change revises the approach to determining when a 
potential emergency condition is expected to cause a ``significant 
economic loss'' (SEL). In addition to reducing the application and 
review burden, the new economic assessment approach will result in 
consistent and equitable determinations of whether a significant 
economic loss is expected. These two streamlining approaches have been 
tested in limited pilot projects since 2003.
    In addition, EPA is making a number of revisions to correct or 
update minor administrative aspects of the emergency exemption 
regulations. The reason for each of these minor administrative 
revisions falls into one of the following categories: Conformance with 
statutory requirements arising from the Food Quality Protection Act of 
1996 (FQPA); codification of improved practices that have been 
voluntary but widely followed by applicants; and correction of 
typographical or administrative errors. Also, the Agency is adding 
specific language to the regulations to clarify that treatment of 
``invasive species'' is a valid basis for issuing a quarantine 
exemption.

III. Statutory Authority

    EPA regulates the use of pesticides under the authority of two 
federal statutes: 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 that 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 USC 346a). Section 408(l)(6) provides that where EPA grants an 
emergency exemption under FIFRA section 18, the Agency must establish a 
time-limited tolerance or exemption from the requirement of a tolerance 
for any residues of the pesticide chemical in food or feed.

IV. Background

A. April 2003 Notice Initiating Pilot for Two Primary Revisions now 
being Codified

    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 pilot continued through the end of 2005, but has 
not been extended for 2006 as it is superceded by this final rule. The 
two potential improvements included in the pilot were: (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 re-submit to EPA complete new 
applications and, (2) a new approach to documenting an SEL that focuses 
on the significance of the potential loss relative to yields and/or 
revenues without the emergency rather than a 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 final rule, with modification. Today's final rule 
expands the application to all pesticides, beyond the restriction to 
reduced-risk pesticides under the limited terms of the pilot.
    Anyone interested in the background leading up to the pilot 
program, or other related documents, may wish to review the 
announcement of the pilot, and the related documents. EPA considers the 
comments on the pilot program to be part of the administrative record 
for this rulemaking. A public docket was established for that 
announcement under docket ID number EPA-HQ-OPP-2002-0231. Interested 
parties should follow instructions under ADDRESSES for accessing the 
docket, but should use docket ID number EPA-HQ-OPP-2002-0231 to access 
the docket for the April 24, 2003, announcement.

B. September 2004 Proposed Rule

    EPA published a proposed rule on September 3, 2004 (69 FR 53866) 
(FRL-7371-3). The proposed rule included proposals for the two revised 
practices in the pilot program, but without the limitation to reduced-
risk pesticides, as well as a number of minor administrative revisions. 
Key public comments and Agency responses are briefly summarized in Unit 
V. of this document and, more completely, in a separate Response to 
Comments document available in the public docket.
    Those interested in seeing the proposed rule, related documents, 
and public comments submitted may access them in the docket. A public 
docket was established for this rulemaking under docket ID number EPA-
HQ-OPP-2004-0038. Interested parties should follow instructions under 
ADDRESSES for accessing the docket.

C. Summary of Pilot Experience

    The pilot was started on April 24, 2003, and will not be extended 
for the 2006 growing season as it is being superceded by today's final 
rule. Applicability of the pilot was restricted to ``reduced-risk'' 
pesticides in order to limit the scope and effectively add an 
additional margin of safety while the new procedures were tested. 
Although participation in the pilot was limited, the process worked 
well for both applicants and EPA.
    For the 2003 growing season, 16 exemptions were identified by EPA 
as eligible for re-certification, of which 7 submitted re-certification 
applications. In 2004, 12 exemptions were eligible, of which 4 applied 
by re-certification, while in 2005, 10 exemptions were eligible for re-
certification and 6 used the process. EPA made expedited decisions on 
re-certification requests under the pilot in an average of 9 days in 
2003, 14 days in 2004, and 8 days in 2005, counted from receipt of the 
request until the decision was made. Of the exemptions that were 
eligible but for which no re-certification was submitted, some were for 
pesticide uses that had obtained federal registration under FIFRA 
section 3 since the previous year's exemption, some were not requested 
at all (indicating that the

[[Page 4497]]

emergency ended), and the others were requested using conventional 
exemption requests.
    The revised approach to determining an SEL applied to any new 
exemption request, as long as the requested chemical was designated as 
reduced-risk. However, for all 3 years of the pilot, EPA voluntarily 
conducted economic evaluations of exemption requests using both the 
current approach of historical 5-year data, as well as the proposed new 
loss-based (tiered) approach. This experience indicates that the new 
approach will not cause EPA to find SEL more commonly, nor expand the 
definition of emergency. A retrospective analysis to develop the loss-
based approach, covering 2000 through 2003, showed that approximately 
the same number of requests would result in an SEL finding using the 
new, loss-based approach as actually occurred under the existing 
approach. The new criteria will, in most cases, reduce applicants' data 
burden and thereby streamline the exemption process.

V. Public Comments, EPA Responses, and Modifications for Final Rule

    This unit briefly discusses the major public comments received on 
the proposed rule, EPA's responses to those comments, and changes made 
in the final rule as a result. All comments leading to modifications to 
the proposed revisions for the final rule are included here, as are 
opposing comments on the same issues, and comments opposed to proposed 
revisions for which modifications were not made. A more detailed, 
complete summary of public comments and Agency responses is available 
in a separate document in the public docket for this rule. That 
document also addresses comments and responses on the April 2003 
document that announced the pilot program.
    A total of 28 submissions of public comments on the proposed rule 
were received. A total of 41 commenters were represented by these 
comments, as some were submitted jointly by multiple parties. For ease 
of discussion and a better understanding of the sources of the various 
comments, commenters are grouped according to the type of organization 
or interest. The number of comment submissions on the proposed rule, by 
type of commenter are: Two by education/research groups; 3 by 
agriculture/food industry groups; 1 by environmental/public interest 
groups (joint submission by 13 groups); 12 by grower groups; 2 by 
pesticide industry/registrants; 1 by a private citizen; and, 10 by 
States (9 State lead pesticide regulatory agencies and 1 by the 
American Association of Pesticide Control Officials, which represents 
the States in pesticide regulatory matters).
    Generally, all except for the environmental/public interest groups 
and the private citizen favored both of the two primary proposals, 
although a few only commented on one of the two, and some suggested 
modifications. The 13 environmental/public interest groups and the 
private citizen were opposed to both of the primary revisions, but the 
environmental/public interest groups also suggested some modifications 
to the proposals.
    All changes made in the final rule relative to the proposed rule 
are explained in this unit, while a summary of all provisions of the 
final rule is in Unit VI. EPA decided to make these changes to the 
proposed revisions after considering public comments on the proposed 
rule. Each substantive comment is briefly paraphrased, followed by 
EPA's response to that comment. Where multiple commenters made a 
substantially similar comment, it is stated once, with an indication of 
how many made the comment and the types of organizations the commenters 
represent.
    This unit is organized into separate sections for the two main 
provisions of the final rule, a section on all other aspects of the 
rule, and a section on miscellaneous comments not covered in the first 
three sections. Within each section, one or more issues raised by 
commenters is addressed. For each issue, all applicable comments are 
presented, followed by EPA's response, including the resulting 
modification to the proposed revision, if any, and the rationale for 
making the change or not.

A. Re-certification of Emergency Condition by Applicants

    EPA has significantly reorganized Sec.  166.20(b)(5) for improved 
clarity, but no substantive changes relative to the proposed rule are 
intended, except as discussed below.
    1. Commenter Issue: Allow re-certification beyond third year--(a) 
Comments requesting modification to proposal. The proposed rule would 
have allowed re-certification applications only in the second and third 
years of an exemption for an applicant, assuming the exemption met the 
eligibility criteria (e.g., type of emergency condition that could 
reasonably be expected to continue). Many commenters stated that 
eligibility to use a streamlined re-certification application for 
repeat requests should not be limited to the second and third years of 
an exemption, but rather be longer or indefinite, as there is no 
compelling reason to limit it to 3 years. These commenters argued that 
re-certification is specifically and solely for the purpose of 
determining the existence of an emergency condition, and that EPA could 
still decline a valid re-certification application based on new risk 
information, availability of new alternative controls, or insufficient 
progress toward registration of the requested use.
    In addition, full registration of a pesticide product often takes 
longer than 3 years, particularly for minor uses, even when States move 
expeditiously to identify the need. The commenters felt that States and 
affected growers should not be penalized when registration actions take 
more than 3 years. Commenters who supported allowing re-certification 
beyond the third year suggested various alternative limitations, 
including no limit. These general comments were made by 22 commenters 
(9 grower groups, 7 State lead agencies, 2 education/research groups, 2 
agriculture/food industry groups, and 2 pesticide industry/
registrants).
    (b) Opposing comments. Other commenters felt that applicants should 
not be allowed to re-certify emergency conditions at all. They stated 
that repeat conditions are routine, and therefore not an emergency, as 
defined in the regulations. These commenters believe that repeat 
requests reflect poor management by growers and that repeat exemptions 
should be more difficult, not easier, to obtain. They contend that EPA 
already grants too many repeat exemptions and ignores progress-toward-
registration requirements. Allowing applicants to re-certify emergency 
conditions would only make matters worse. These comments were made by 
13 environmental/public interest groups in a joint submission, and by 
one private citizen.
    (c) EPA Response, including decision on re-certification limits. 
EPA has carefully considered the comments summarized above concerning 
whether, and how long, to allow re-certification applications. The 
Agency is convinced not only that the re-certification process will 
provide the intended benefits of reduced burden and potentially quicker 
emergency response without negative consequences, but also that it 
would afford the same benefits in subsequent years as it would in the 
second and third years. Therefore, benefits would increase with the 
greater applicability of this improved process. Any specific limit to 
the number of years of eligibility for re-certification would be 
arbitrary. Therefore, in the final rule EPA has chosen to remove the 
applicability

[[Page 4498]]

restriction for re-certification that would have limited it to the 
second and third years.
    However this modification to the proposed 40 CFR 166.20(b)(5) 
includes the authority for EPA to declare an exemption ineligible for 
re-certification at any time, on a case-by-case basis. In determining 
whether to end eligibility for re-certification, the Agency will 
consider the continued validity of the information, generally from the 
original application, that documents the projected losses, as well as 
whether any of the other information needs to be updated. If EPA 
decides that updating the documentation of an SEL is likely to 
significantly improve the projected loss estimates, or, if any other 
information casts doubt on whether the initial conditions still exist, 
then the Agency may declare the exemption ineligible for re-
certification. The applicant for any exemption that is ineligible for 
re-certification may use a standard, full application format.
    In response to comments questioning whether re-certification, or 
any repeat exemption requests, should be allowed at all, EPA has 
recognized for many years that an emergency may continue for multiple 
years when the emergency condition continues relative to the routine 
situation prior to the first occurrence of the emergency. This most 
commonly occurs when a pesticide, formerly relied upon by growers, 
becomes unavailable for use or loses effectiveness and no other 
effective means of pest control is available. Such a situation would 
generally continue until an alternative control becomes available, 
e.g., an effective alternative pesticide becomes registered for the use 
(often the chemical requested for the exemption), or an effective 
alternative non-chemical control becomes available.
    The ability to indefinitely re-certify emergency conditions is not 
expected to increase the number of exemption requests submitted or the 
number of exemptions granted. EPA expects that when an emergency 
condition continues in a subsequent year, States would submit a repeat 
application regardless of whether a streamlined or full application 
were required. This rule reduces the burden in such situations. EPA 
believes that the reduced burden afforded by this rule would not induce 
applicants to make a repeat request.
    Re-certification that an emergency condition continues to exist, 
for a previously granted exemption, would be part of a streamlined 
application for an emergency exemption. If the same emergency condition 
exists in a subsequent year that existed for the first year of an 
exemption, then EPA would generally again find that the emergency 
condition exists, regardless of whether a full application or a re-
certification application were submitted. A re-certification 
application would simply reduce the burden on the applicant and help 
the Agency make the emergency determination more quickly. However, a 
determination by EPA that an emergency condition exists is not 
sufficient basis for an exemption to be approved. A re-certification 
application is no more likely to be approved than a full application 
for the same repeat request. Like a full application, a re-
certification application would also be reviewed for, and could be 
denied owing to any of the following: New risk information; 
availability of new, effective alternative controls; or insufficient 
progress toward registration of the requested pesticide use.
    Some commenters believe EPA grants too many repeat exemptions and 
that some exemptions are repeated for too many years. EPA would like to 
limit the number and length of long-running exemptions, and is pursuing 
new opportunities for minimizing such outcomes. Each year, EPA makes 
registration decisions on a large number of pesticide uses sought 
separately by State applicants under the emergency exemption program. 
For the fiscal years 2001 through 2004, EPA transitioned 313 uses to 
federal labels that had been requested under the section 18 exemption 
program, thereby precluding further repeat exemptions for those uses. 
These products are registered after a comprehensive analysis of the 
risks posed by these uses.
    In addition, the Pesticide Registration Improvement Act (PRIA), 
enacted in early 2004, established time limits for EPA to make 
decisions on registration actions under section 3 of FIFRA which should 
further accelerate the pace of registration decision-making for all 
actions. Because of the emphasis within PRIA on review schedules, EPA 
is processing registration decisions more quickly than in the past. 
Pesticide uses that are requested for repeat exemptions will either 
gain registration more quickly than in the past, or their registration 
application could be not granted or denied in the same timeframe. The 
congressionally mandated review schedules under PRIA all become shorter 
and more compressed in upcoming years. For instance, the Agency's 
available review period for a new food use for a conventional pesticide 
goes from 38 months in FY 2004 to 22 months in FY 2006. Similarly, the 
review schedule for each type of registration action becomes shorter in 
later implementation years of the law. Although PRIA shortens the 
timeframe for registration decisions, the law also provides more 
resources through registrant fees and does not compromise the rigorous, 
comprehensive nature of the risk analysis necessary to support each 
registration decision. In this manner, EPA expects that each 
registration action will be evaluated within the context of PRIA. Under 
the previous priority planning scheme, certain actions did not receive 
priority due to resource and policy considerations. Additionally, EPA 
is mandated to complete re-registration of older pesticides by the end 
of 2006. Remaining decisions on eligibility to re-register pesticide 
products are also expected to affect repeat exemptions, leading to the 
denial of some and paving the way for the registration of others.
    The Interregional Research Project No. 4 (IR-4) program is a highly 
successful cooperative effort and partnership of the State land grant 
universities, industry, the U.S. Department of Agriculture (USDA), and 
EPA, to address the chronic shortage of pest control options for minor 
crops. In many cases, the crop protection industry lacks economic 
incentive to pursue registrations on minor crops because of low acreage 
and limited sales potential. IR-4 generates and supplies research data 
needed by EPA in order to register compounds for use on minor crops. 
The IR-4 process continues to improve, and registrations for repeat 
exemptions are among the highest priorities in the IR-4 queue. In 1999, 
IR-4 initiated a streamlined project schedule of 30 months for its 
highest priority clearance projects. Pest management gaps associated 
with section 18 applications qualify for this highest priority schedule 
of 30 months. IR-4 is also increasingly performing research on 
pesticides which are presumed to pose less hazard than traditional 
synthetic chemicals. Over three quarters of the pesticides IR-4 
evaluates and then submits for review to EPA are classified as reduced-
risk materials under the Agency's programs for supporting transition to 
lower toxicity and sustainable means of pest management. Additionally, 
the review schedule under PRIA also favors and places a bias in support 
of submissions involving reduced-risk pesticides. For instance, the 
Agency's review time period under PRIA for a new use of a conventional 
pesticide in FY 2006 is 22 months whereas the review period for a 
reduced-risk pesticide in FY 2006 is 20 months. These incentives could 
help IR-4 and its collaborators realize a large

[[Page 4499]]

number of clearances. EPA anticipates that the processes discussed 
above will further enhance recent successes in registering repeat uses 
faster, as well as ensure that regulatory evaluations for any pending 
registration actions associated with a section 18 use will take place 
efficiently.
    EPA has authority under Sec.  166.32 to revoke any exemption during 
its active use period, if the Agency learns that the emergency no 
longer exists, the risks are unacceptable, the use is not effective, or 
users are not complying with the terms and conditions of the exemption. 
When necessary and appropriate, this provides another means to end 
long-running exemptions quickly, without waiting for an exemption to 
expire.
    2. Commenter Issue: Make voluntarily canceled pesticides ineligible 
for re-certification--(a) Comments requesting modification to proposal. 
Some commenters felt that voluntarily canceled pesticides should be 
added to the list of pesticide categories for which, when requested for 
an exemption, the applicant is not eligible to use a re-certification 
application. The proposal already lists several categories of 
pesticides (e.g., new active ingredient, first food use, canceled 
pesticides) that warrant heightened review and public notice, and are 
therefore not eligible for re-certification. These commenters contended 
that EPA should not allow re-certification for voluntarily canceled 
pesticides. This comment was made by 13 environmental/public interest 
groups in a joint submission.
    (b) Opposing comments. No other comments were received on the issue 
of pesticide categories ineligible for re-certification.
    (c) EPA Response, including decision on modification. The proposed 
rule listed several categories of pesticides as ineligible for re-
certification. Specifically, the existing regulations at 40 CFR 
166.24(a) identify a number of situations where, upon receipt of an 
application for an emergency exemption, the regulatory status of a 
pesticide product calls for public notice and comment. EPA believes 
there is a legitimate need for heightened review and awareness of 
exemption requests with the listed regulatory statuses. Both the 
notice-and-comment requirements as well as the need for heightened 
review would preclude the benefit of an expedited review that would 
otherwise be expected from a re-certification application. The 
categories proposed as ineligible for re-certification include new 
pesticide active ingredients, first food uses, canceled or suspended 
pesticides, and pesticides that have been the subject of a Special 
Review. Because a pesticide that has been voluntarily canceled by its 
registrant may be similar to these other categories of pesticides, the 
Agency agrees with this comment and believes this category of pesticide 
uses should also be ineligible for re-certification. Therefore, the 
proposed 40 CFR 166.20(b)(5) is modified accordingly in the final rule. 
Also, EPA is expanding the provision for 40 CFR 166.24 to add this 
category of pesticide uses to those for which EPA will issue a Notice 
of Receipt. Therefore, a Notice of Receipt will be published in 
connection with the submission of emergency exemption uses that involve 
pesticide uses which have been voluntarily canceled. Therefore, while 
applicants may still request exemptions for a voluntarily canceled 
pesticide, the streamlined re-certification application process will 
not be allowed for such uses.
    3. Commenter Issue: Add to documentation requirements for repeat 
exemptions--(a) Comments requesting modification to proposal. Some 
commenters suggested that repeat applicants should be required to 
document at least:
    (i) What effect the exemption had on the emergency condition during 
the first year,
    (ii) Why the exemption continues to be necessary,
    (iii) That there are no feasible non-chemical alternatives, and,
    (iv) That the original predictions of economic harm are legitimate. 
This comment was made by 13 environmental/public interest groups in a 
joint submission.
    (b) Opposing comments. No other comments were received on the issue 
of modifying the documentation requirements for repeat exemption 
requests.
    (c) EPA Response, including decision on modification. EPA's 
responses below correspond to the lettered list of the commenters' 
suggested documentation requirements for repeat requests:
    (i) Annually, in a post-exemption report per Sec.  166.32, and with 
any repeat application per Sec.  166.20(a)(11), applicants will still 
be required to include a description of the effect the exemption had on 
the emergency condition.
    (ii) A re-certification application must contain a certification 
that the same emergency condition previously documented continues and 
is the reason the exemption continues to be necessary.
    (iii) EPA believes that the applicant is in a better position than 
the Agency to identify availability of a non-chemical alternative, 
i.e., cultural practice, for the specific use in their State. EPA 
agrees that it would be appropriate to have applicants (which are 
primarily State agencies) for repeat exemptions document availability 
and effectiveness of new non-chemical controls identified since the 
previous year's application, or to certify that none are known. 
Therefore, in the final rule EPA has added a requirement, at Sec.  
166.20(b)(5)(v)(E), that applicants certify that they are not aware of 
any alternative non-chemical practice that may offer a meaningful level 
of pest control, or else provide documentation that each such known 
practice does not provide adequate control or is not economically or 
environmentally feasible. In situations where such effective and 
feasible cultural practices are available, EPA would not grant the 
exemption because there would not be an emergency condition, by 
definition.
    (iv) One way to validate the reasonableness of the estimated losses 
would be to allow them to happen, i.e., to grow the crop under the 
emergency condition without use of the requested pesticide. EPA already 
has the discretion to grant a repeat exemption subject to the condition 
that some research areas be grown under the emergency condition without 
use of the requested pesticide, although such validation has generally 
not been required. Occasionally, confirmatory data, such as comparative 
product performance studies, are required on repeat requests. The re-
certification program would not alter this practice. Furthermore, re-
certification requires that other economic factors that result in a 
projection of an SEL (e.g. cost of alternative, crop prices) have not 
changed substantially, and that there is no new information about pest 
damage.

B. Determining and Documenting ``Significant Economic Loss'' (SEL)

    1. Commenter Issue: Lower quantitative thresholds for SEL, add 
flexibility--(a) Comments requesting modification to proposal. Some 
commenters said that the thresholds for the three tiers for determining 
SEL should be lower, as the proposed thresholds require total 
elimination of net income to qualify. Also, EPA should be allowed 
flexibility to use judgement to make an SEL finding for situations not 
meeting any of the thresholds. Commenters argued that total elimination 
of annual net income is too severe a threshold, and that some lesser 
loss constitutes a significant economic loss. These commenters feel the 
three tiers should be screens to identify obvious emergencies, and that 
flexibility, which does not clearly exist

[[Page 4500]]

in the proposed rule, should be added to identify the less obvious 
emergencies. No commenter suggested an alternative level for any 
threshold, or a basis on which to develop one. This general comment was 
made by 17 commenters (9 grower groups, 4 State lead agencies, 2 
agriculture/food industry groups, and 2 pesticide industry/
registrants).
    (b) Opposing comments. Other commenters felt that the proposed 
quantitative thresholds for determining SEL are already too low. They 
stated that the proposed tiered approach to document an SEL with the 
selected thresholds would unreasonably expand the definition of 
emergency and make it easier to find that an emergency exists. These 
commenters felt that the proposed method allows prohibited pesticide 
uses for profit. They assert that the proposed new approach together 
with the quantitative thresholds for the three tiers are unlawful, 
arbitrary and capricious, and contrary to congressional intent. This 
comment was made by 13 environmental/public interest groups in a joint 
submission.
    (c) EPA Response, including decision on modification. After 
considering all comments, EPA believes that the proposed thresholds are 
appropriate and should not be relaxed, but that flexibility should be 
available to allow EPA to use judgement to make an SEL finding where 
projected losses are particularly difficult to quantify or other 
factors warrant an emergency exemption. Some commenters concluded that 
the proposal provided no flexibility for EPA to use judgement to 
determine an SEL for situations not meeting any threshold, regardless 
of how close to a threshold quantitative loss projections may come. To 
the extent that this comment reflects a concern that EPA would consider 
only quantitative data in determining whether the loss thresholds are 
met, EPA notes that it interprets the language of both the proposed and 
final rule to allow for consideration of estimates based on qualitative 
information, either alone or in addition to quantitative information, 
in determining whether losses under the emergency condition would 
exceed the thresholds for SEL. However, EPA intends to limit the use of 
qualitative information to document projected losses, relying on such 
information only in cases where credible quantitative information is 
not available.
    In response to the concern that the quantitative loss thresholds of 
Sec.  166.3(h)(1) may not apply to all pest activity primarily 
affecting the current growing season, EPA has expanded Sec.  
166.3(h)(2) so that EPA may use its broader criteria wherever they are 
more appropriate. The proposed rule provided a loss-based approach with 
quantitative thresholds applicable to pest activity primarily affecting 
the current growing season under Sec.  166.3(h)(1), and ``for all other 
pest activity'' included in a provision at Sec.  166.3(h)(2) to 
determine an SEL for situations where the loss-based approach does not 
adequately address the expected loss, similar to a provision in the 
existing regulations. Such losses include those not confined to the 
current year or those that impact capital assets rather than productive 
activities. This change to Sec.  166.3(h)(2) will allow the flexibility 
to apply an appropriate methodology for assessing the consequences of 
an emergency, and help ensure that any of the widely variable 
situations potentially causing an SEL can be adequately addressed.
    Although no commenter addressed the issue, EPA has corrected the 
scope of the proposed SEL definition. The SEL criteria under the 
proposed Sec.  166.3(h)(1) would have applied to ``pest activity that 
primarily affects the current crop.'' For the final rule ``or other 
output'' is added after ``current crop,'' so that non-crop productive 
activities (e.g., dairy production) may also be assessed under the 
loss-based, tiered approach. For the same reason, EPA has removed the 
word ``crop'' from Sec. Sec.  166.3(h)(1)(i) and 166.20(b)(4)(i).
    As explained above, some commenters believe that the proposed 
thresholds for SEL are too high, arguing that these thresholds 
effectively require total elimination of net income to qualify. Other 
commenters believe that the proposed thresholds make it easier to find 
that an emergency exists, allowing unregistered pesticide uses for 
profit. Actually, the selected thresholds neither raise nor lower the 
standard for SEL. EPA's retrospective analysis of past exemption 
requests, discussed in the Economic Analysis available in the public 
docket for this final rule, shows that the new approach would not make 
SEL findings any more common and would not otherwise expand the 
definition of emergency. The analysis indicates that virtually the same 
number of requests would result in an SEL finding using the new 
approach as actually occurred under the current approach, although 
different findings (in both directions) may occur in some individual 
cases.
    Although the new tiered approach for determining SEL maintains the 
same overall standard to qualify, its fixed, quantitative thresholds 
intentionally make the standard consistent, in contrast to the current 
variable standard. However, the fixed SEL standard allows an easy 
comparison of the quantitative thresholds to farm income statistics. It 
is true that, according to USDA statistics, the new thresholds for SEL 
are roughly equivalent to elimination of net farm income from the 
affected crop, if fixed costs are also considered. Because the new SEL 
standard is comparable to the average of the current standard, for the 
first time it is apparent that the current standard is approximately 
equivalent to elimination of net farm income. However, when the States 
recommended revising the approach to determining SEL, their stated 
reason was to establish a fixed standard that is more equitable and 
easier to document. EPA had extensive interaction with stakeholders 
during the development of this rule, but received no input saying that 
the existing standard for SEL was too high.
    EPA acknowledges that economic terms such as ``net revenue'' and 
``net farm income'' may be confusing and are not always used the same 
way by all parties. Although the proposed threshold for the third tier 
for SEL is 50% of ``net revenues,'' as defined in the preamble to the 
proposed rule, this is not equivalent to ``profits'' because it does 
not include fixed costs. For the purpose of this rule, EPA defines net 
revenue as gross revenue less variable operating costs. A calculation 
of ``profit'' would typically subtract fixed costs from this amount. In 
this case, ``profit'' is roughly equivalent to the gross pay of a 
typical salaried employee and is essentially the return to the farmer's 
labor and managerial skills. This is also referred to as ``net farm 
income.'' If typical fixed costs were included in the consideration of 
impacts on income, a loss of 50% of net revenues (Tier 3 threshold) 
would, according to USDA statistics, result in approximate elimination 
of net farm income. With this as the context for the SEL thresholds, 
EPA believes that there is no basis for concern that farmers might 
unduly profit from emergency exemptions.
    Section 18 of FIFRA provides broad discretion for EPA to define and 
determine, by regulation, when an emergency exists. The Agency believes 
that the new approach and thresholds are not arbitrary or capricious, 
as they are essentially refinements to make the standard that has been 
used for years more uniform and equitable, without raising or lowering 
it. Furthermore, while this standard may seem severe to some, the 
standard for SEL was always intended to identify and avert true 
economic emergencies, and was not intended to maintain farm income at 
or

[[Page 4501]]

near a certain level. EPA believes that there should be a high standard 
for allowing an exemption from the requirements of registration. Even 
if EPA were to consider a lower standard, the Agency is not aware of a 
basis for selecting a lower standard that would not be arbitrary.

C. Other Regulatory Provisions

    1. Commenter Issue: Confirm efficacy and economics of non-chemical 
alternatives--(a) Comments requesting modification to proposal. 
Commenters stated that EPA should use section 18 to promote Integrated 
Pest Management (IPM) by confirming the efficacy and economics of non-
chemical alternatives for pesticide uses requested for an emergency 
exemption. This comment was made by 13 environmental/public interest 
groups in a joint submission.
    (b) Opposing comments. No other comments were received on this 
issue.
    (c) EPA Response, including decision on modification. The existing 
Sec.  166.20(a)(4)(ii) already requires applicants to explain why 
alternative practices would not provide adequate control or would not 
be economically or environmentally feasible. Some time after this final 
rule is issued, EPA plans to provide new guidance for applicants to 
improve the quality and consistency of information submitted on non-
chemical alternatives. Although EPA supports and encourages IPM and use 
of risk-reducing, alternative, non-chemical controls, as evidenced by 
the Agency's voluntary Pesticide Environmental Stewardship Program, the 
Agency does not directly regulate cultural practices. For this reason 
and because applicants are typically State agricultural agencies, EPA 
believes that the applicant is in a better position than the Agency to 
identify availability of a non-chemical alternative practice for the 
specific use in their State, and to assess its effectiveness and 
feasibility. In this final rule, a new provision has been added at 
Sec.  166.20(b)(5)(v)(E) to require that applicants using the re-
certification process separately certify that they are not aware of any 
available chemical alternatives or reasonable non-chemical alternative 
practices, or if they know of any such practice that they include with 
the application documentation demonstrating that the chemical or 
practice does not provide adequate control or is not economically or 
environmentally feasible.
    2. Commenter Issue: Clarify or improve notification/confirmation 
for crisis exemptions--(a) Comments requesting modification to 
proposal. Commenters stated that for crisis exemptions, the proposal to 
have applicants notify EPA and receive verbal confirmation from the 
Agency of no risk-based objections before using the crisis provisions 
needs clarification and possible revision. The proposal says that EPA 
will attempt to provide such confirmation as quickly as possible, and 
within 36 hours. Commenters stated that they may not be able to reach 
the appropriate EPA contact on a Friday, a weekend, or a holiday, which 
could delay confirmation and use of the crisis exemption until 36 hours 
after the beginning of the next work day. They suggest that EPA make 
someone available at all times, or, add a provision that notification 
can be made by voicemail, and a consent by default would be assumed 
after 36 hours if the applicant has not heard back from EPA by that 
time. One commenter also suggested that EPA should make exceptions to 
the 36-hour waiting period for EPA confirmation for some uses, 
including public health crises, bioterrorism attacks, and non-food 
uses. This comment was made by two State lead agencies.
    (b) Opposing comments. No other comments were received on this 
issue.
    (c) EPA Response, including decision on modification. The reason 
for this revision is to replace the current ambiguous language at 40 
CFR 166.43(a), which allows for the possibility of a State or federal 
agency notifying EPA after beginning use of the crisis provisions. The 
revision will codify a process that has been widely practiced and 
accepted by applicants, and that has become more necessary after 
enactment of FQPA. FQPA expressly required that time-limited tolerances 
be established for emergency exemption uses that may result in residues 
in food. EPA maintains that it is in the best interest of all parties 
(including States, EPA, users of pesticides under section 18, the food 
processing and marketing industries, etc.) that there is some assurance 
before the use begins that EPA will be able to establish a ``safe'' 
tolerance for a pesticide to be used under a crisis exemption. Without 
that assurance, users run the risk of producing an adulterated crop 
that results in unsafe pesticide residues and would be illegal to sell. 
It is also important that EPA be given the opportunity to voice other 
objections to a use being considered for a crisis exemption. The Agency 
may be aware of risk issues unknown to the applicant, and has the 
authority to deny crisis provisions for a particular pesticide use, 
under Sec.  166.41(a).
    EPA is keenly aware of the time-sensitivity of emergency situations 
for which crisis exemptions are needed. The Agency will continue to 
make every effort to receive and quickly respond to notifications of 
intent to declare a crisis. EPA believes that the concerns raised by 
these commenters can be adequately addressed in the same manner that 
EPA has managed these issues since enactment of FQPA. It is true that 
EPA staff are not available at all times, such as at night or during 
weekends, to receive notification of a State's intent to declare a 
crisis. However, EPA believes that applicants generally first become 
aware of the need for a crisis exemption at least a few days before 
notifying EPA of its intent to issue a crisis exemption. If an 
applicant notifies the Agency of their intent to declare a crisis as 
soon as possible, even before they have gathered all of the necessary 
information, EPA should be able to provide confirmation before use of 
the pesticide is needed. The Agency believes that the existing 
confirmation process now being codified has not caused significant 
delays to use of crisis exemptions in the past. In fact, there have 
been cases where EPA staff have worked with applicants during weekends 
in order to provide timely confirmation, and in extraordinary 
circumstances EPA will continue to do this in the future. A default 
presumption of no EPA objection to a crisis exemption, in cases when 
the Agency cannot be immediately reached, would provide neither the 
necessary assurances for users of the pesticide, nor proper protections 
for human health and the environment.
    EPA is not taking the commenter's suggestion that an exception to 
the need for EPA confirmation be made in cases of non-food uses, or 
public health or bioterrorism threats. For non-food uses, EPA can 
generally provide confirmation more quickly than for food uses, but 
must still be allowed the opportunity to identify other unacceptable 
risks. In the case of major public health threats or bioterrorism, a 
national emergency network and system is in place that will enable 
applicants to contact EPA at any time, and EPA will quickly respond. 
Through the National Infrastructure Protection Plan, as part of a 
network of federal, State, and local governments, agencies can quickly 
contact EPA whenever a public health threat arises, including 
terrorism. In such cases, the Agency expects to be able to act very 
quickly and at any time. For certain listed biological threats, there 
is an expedited process in place whereby, once notified of the 
emergency need for an unregistered pesticide or use, EPA would evaluate 
the applicant's remedial action plan and, after considering the

[[Page 4502]]

safety and efficacy of such use, would decide whether to issue a crisis 
decision.
    The Agency has modified the proposed language at Sec.  166.43(a) 
for the final rule, to remove references to EPA's confirmation and the 
36-hour time period, as it is not appropriate in this paragraph for 
notification by applicants to EPA. EPA will strive to provide the 
confirmation as quickly as possible and within the customary 36 hours, 
and will attempt to match the urgency of decision-making with the 
urgency of the situation. This final rule does not attempt to change 
the timeframe in which EPA provides confirmation. The Agency's practice 
will continue that the 36-hour clock does not start until EPA actually 
receives and acknowledges the notice, and only applies to business 
days. The lack of a response in 36 hours should not be interpreted as 
approval of the crisis exemption; this final rule does not include 
decision by default. The language in the proposed Sec.  166.40(c) is 
modified for this final rule to allow EPA to withhold confirmation due 
to any objection, not just risk-based objections.

D. Miscellaneous Comments

    Protections for endangered species under the emergency exemption 
program and pest resistance management issues are discussed in Unit 
VIII. These are important issues that were discussed in the preamble to 
the proposed rule, but for which no regulatory revisions were proposed. 
Some comments received on these issues are addressed in Unit VIII, 
while other significant miscellaneous comments are included below.
    1. Commenter Issue: The section 18 pilot violates the 
Administrative Procedure Act--(a) Comment summary. Commenters stated 
that the section 18 pilot violates the Administrative Procedure Act 
(APA) as a binding regulation without notice and comment. These 
commenters went on to say that EPA solicited public comment on the 
pilot provisions in the Federal Register Notice that initiated the 
pilot, but failed to respond to those comments. This comment was made 
by 13 environmental/public interest groups in a joint submission.
    (b) Opposing comments. No other comments were received on this 
issue.
    (c) EPA Response. The comment that the pilot violated the APA is 
not relevant to the proposed or final rule and to whatever extent it 
might have been relevant to the pilot program, the issue is moot 
because EPA has ended the pilot program. EPA disagrees with the comment 
because the section 18 pilot program was not a binding regulation and 
did not require notice and comment rulemaking under section 553 of the 
APA. EPA believes that participants in the section 18 pilot program 
conformed to the requirements of the Agency's existing regulations 
pertaining to emergency exemption requests at 40 CFR part 166. The 
purpose of the pilot was to gain experience and gather information for 
the rulemaking on improvements to the section 18 process. The pilot was 
intentionally limited in scope. During the course of the pilot, less 
than 5% of all applications received were eligible for the pilot and 
utilized its provisions. No applicant was required to use the pilot. 
EPA is confident that the pilot's standard for an emergency finding was 
no higher or lower than the current standard. The risk side of the 
assessment and decision process was not changed for the pilot. 
Furthermore, an additional safety margin was essentially added to the 
pilot by limiting application to ``reduced-risk'' pesticides.
    During development of the proposed rule, EPA carefully considered 
public comments received on the Federal Register Notice that initiated 
the pilot. Those comments and EPA responses are summarized in the 
separate response-to-comments document that also addressed comments on 
the proposed rule and is available in the public docket.
    2. Commenter Issue: Documentation for endangered species needs 
clarification--(a) Comment summary. Commenters stated that 
documentation requirements for endangered species concerns in emergency 
exemption requests need clarification and further guidance. They also 
said that EPA, the U.S. Fish and Wildlife Service and the National 
Marine Fisheries Service have data on endangered species that States do 
not have, and these federal agencies should either provide such data, 
or make it readily available to States. One commenter suggested that 
when measures are necessary to protect endangered species, EPA should 
involve the State early (before decision). This comment was made by 
three State lead agencies and by AAPCO.
    (b) Opposing comments. No other comments were received on this 
issue.
    (c) EPA Response: EPA believes that an important aspect of assuring 
protections of endangered and threatened species in the implementation 
of the emergency exemption program is to have available good 
information on the potential exposure and risk of a requested use to a 
listed species and its habitat. Some time after promulgation of this 
final rule, EPA plans to issue improved guidance on what information 
regarding threatened and endangered species should be included with an 
application. EPA will continue to involve applicants in the discussion 
of possible mitigation measures whenever it appears that threatened or 
endangered species may be at risk.

VI. Final Rule Revisions to Emergency Exemption Process

    While Unit V. summarizes changes in the regulatory provisions of 
the final rule from those in the proposed rule, Unit VI. summarizes how 
this final rule revises the existing regulations at 40 CFR part 166 
that govern the emergency exemption process.

A. Re-certification of Emergency Condition by Applicants

    1. How the re-certification process will work. This final rule adds 
a new paragraph (b)(5) to 40 CFR 166.20 that allows applicants for 
eligible repeat exemptions to submit streamlined ``re-certification'' 
applications. The re-certification application process applies only to 
specific exemptions, and is not available to applicants for quarantine 
exemptions, public health exemptions, or crisis exemptions. In 
addition, re-certification can only be used if the same exemption was 
approved for the same applicant the previous year, or use period, and 
meets other eligibility criteria discussed below. Subject to 
limitations specified in Sec.  166.20(b)(5) and discussed below, where 
an emergency condition that originally qualified for an emergency 
exemption continues in a subsequent year, eligible applicants may re-
certify that the same emergency condition continues and rely on the 
preceding year's submission to document the economic impact of the pest 
emergency. This re-certification approach allows applicants to 
incorporate by reference all information submitted in a previous 
application, instead of submitting a complete new application and 
supporting documentation. The re-certification of the emergency 
condition by the applicant combined with other information available to 
EPA will serve as the basis for EPA's determination as to whether an 
emergency condition continues to exist.
    While a re-certification application may allow for speedier 
preparation of exemption requests and quicker determinations by EPA 
that an emergency condition exists, it will not result in automatic 
granting of an emergency exemption. In addition to an emergency 
finding, before granting an exemption EPA must also determine that, 
among other things, there are no

[[Page 4503]]

effective registered alternatives to the requested pesticide use, no 
feasible alternative practices that provide adequate control are 
available, the requested pesticide use will not cause unreasonable 
adverse effects on human health or the environment, and there has been 
sufficient progress towards registration of the requested use. If an 
effective product has been registered for the requested use since the 
previous exemption was approved, an emergency condition may no longer 
exist. If the Agency has received new risk information since approving 
the previous exemption, then the risk will be re-evaluated. Likewise, 
if the request includes any change in the conditions of use that may 
increase exposure, such as application rate, number of applications, 
type of application, pre-harvest interval, re-entry interval, total 
number of acres, or change in the geographic area proposed for 
treatment, then the risk will also be re-evaluated. EPA may determine 
that sufficient progress towards registration has not been made for a 
requested pesticide use. The risk evaluation process for repeat 
requests is not changed by this rule.
    Not all repeat exemption requests will be eligible for re-
certification. Upon approval of any specific exemption, EPA intends to 
make an initial assessment regarding potential eligibility for a 
streamlined re-certification application the following year, in the 
event that the applicant reapplies the next year. EPA will consider the 
following in determining potential 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, and 
therefore not be eligible for re-certification, would include a 
temporary supply problem of a registered product, an isolated weather 
event, or a sporadic pest outbreak.
    2. Whether the pesticide product, owing to its regulatory status, 
warrants heightened review before any additional use is approved. EPA 
will rely primarily 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. The first five categories listed below are 
from the existing 40 CFR 166.24(a), while the sixth is a similar 
category, added for the final rule, as discussed in Unit V.A.2. An 
applicant will be ineligible to use a re-certification application when 
the following categories of pesticides are requested for an exemption:
    (a) A new chemical;
    (b) The first food use of an active ingredient;
    (c) Any use of a pesticide if the pesticide has been subject to a 
suspension notice under section 6(c) of the Act;
    (d) A pesticide which:
    (i) Was the subject of a notice under section 6(b) of the Act and 
was subsequently canceled, and
    (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);
    (e) A pesticide which:
    (i) Contains an active ingredient which is or has been the subject 
of a Special Review, and
    (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;
    (f) A pesticide which:
    (i) Contains an active ingredient which was contained in a 
pesticide product that was voluntarily canceled by its registrant, and
    (ii) Is intended for a use that could pose a risk similar to the 
risk posed by any use of the pesticide which was voluntarily canceled 
by its registrant.
    Furthermore, EPA may declare that an exemption that was previously 
eligible for re-certification is no longer eligible. In determining 
whether to end eligibility for re-certification, the Agency will 
consider the continued validity of the information, generally from the 
original application, that documents the projected losses, as well as 
whether any of the other information needs to be updated. If EPA 
decides that updating the documentation of an SEL is likely to 
significantly improve the projected loss estimates, or, if any other 
information casts doubt on whether the initial conditions still exist, 
then the Agency may declare the exemption ineligible for re-
certification. The applicant for any exemption that is ineligible for 
re-certification may use a standard application.
    In instances where EPA determines that an exemption is potentially 
eligible for re-certification, EPA will advise the successful applicant 
that, should it reapply the following year, they appear eligible to use 
a re-certification application. EPA anticipates that this advice will 
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 appears 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 
appears eligible for re-certification provided the applicant submits 
the specified information. Finally, EPA reserves the authority to 
declare an emergency exemption ineligible for re-certification where, 
in the Agency's sole discretion, it determines that a complete 
application is necessary.
    An acceptable re-certification application must include not only 
the applicant's re-certification that the emergency condition 
continues, but also its certification to several other specific facts, 
or be accompanied by additional information. An eligible re-
certification applicant will be exempted from the information 
requirements of Sec.  166.20(a)(1) through (a)(10), and of the existing 
Sec.  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;
    (v) The applicant is not aware of any alternative chemical or non-
chemical practice that may offer a meaningful level of pest control, 
or, if any, has provided documentation that each such known practice 
does not provide adequate control or is not economically or 
environmentally feasible.
    Applicants meeting the requirements of Sec.  166.20(b)(5), as 
discussed above, would not need to submit new, updated documentation 
that the emergency condition continues or the data elements otherwise 
required under 40 CFR 166.20, except that the interim

[[Page 4504]]

report specified in Sec.  166.20(a)(11) would still be required where a 
re-certification is filed before the final report on the previous 
exemption is available.
    2. Rationale for new re-certification process. Allowing applicants 
for eligible exemption requests to recertify 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 potentially 
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 administrative step of its review of the 
documents supporting the exemption requests. If no pesticides that 
could avert the emergency have been newly registered, no new non-
chemical controls have been developed, and nothing has changed to 
affect the assessment of risk, then re-certification of an emergency 
will lead to significantly shorter Agency review.
    For repeat exemption requests where the emergency situation has not 
changed, EPA's experience with full, annual applications indicates that 
projected yield and revenue losses are generally comparable to those 
found the first year and a significant economic loss is again found. 
This is reasonable since applicable losses are those resulting from the 
emergency situation relative to the situation prior to the first 
occurrence of the emergency. Therefore, with the applicant's 
certification that the emergency condition continues and that all 
information in the earlier application is still accurate, reliance on 
the previously submitted data and other supporting information should 
be adequate to support an emergency finding. Re-certification only 
alters the process for an emergency finding, whereas determinations of 
acceptable risk, availability of alternative controls, and progress 
toward registration are not changed by this final rule. With a re-
certification application, the applicant and Agency must still address 
these other areas necessary to approve or deny the request, just as 
with a full application. Furthermore, the final rule provides that EPA 
may declare an exemption ineligible for re-certification at any time, 
should the Agency decide that a full application is more appropriate. 
For the reasons discussed above, EPA believes that the re-certification 
process will provide the benefits of reduced burden and quicker 
emergency response, without compromising either the quality of 
decisions or protections for human health and the environment.

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

    1. How determination of significant economic loss (SEL) will work. 
This rule re-defines ``significant economic loss'' at 40 CFR 166.3(h). 
Under the new definition, the method for determining the amount of the 
projected loss due to the emergency condition will not change, although 
the calculation will be done in steps (tiers) and sometimes the later 
steps will be unnecessary. However, the new definition of SEL changes 
how EPA will determine whether the loss is considered ``significant.'' 
The revised approach provides standard criteria for determining the 
significance of the projected 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. Successive 
screening levels (tiers) have been chosen that permit situations that 
clearly qualify to be resolved quickly, with a minimum of data. Each 
tier has a quantitative loss threshold that generally applies 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 requires more data and involves 
more analysis on how the emergency affects revenues.
    Tier 1: Yield Loss - Tier 1 is based on quantity loss, i.e., crop 
yield or other output 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 is 20% for 
all situations. 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 is not necessary to 
separately estimate economic loss, which would require detailed 
economic data.
    Tier 2: Economic Loss as a Percentage of Gross Revenues - A 
quantity or yield loss that does not satisfy the threshold in Tier 1 
may nonetheless cause a significant economic loss because such loss 
alone may not reflect all economic losses. Quality losses may result 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 or output 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 is 20% of gross revenue for all situations. 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 
quantity nor economic losses are above the thresholds in Tiers 1 and 2, 
EPA will compare impacts to net revenues. Net revenues are defined for 
the purposes of this rule as gross revenues minus operating costs. The 
loss threshold in Tier 3 is 50% of net revenues for all situations. 
Emergency conditions that fall short of the thresholds in Tiers 1 and 2 
may qualify as a significant economic loss in Tier 3, particularly for 
enterprises with high costs of production relative to gross revenue.
    Applicants should 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 appear in Sec.  166.20(b)(4)(i). If the projected loss 
does not meet this threshold, applicants should determine whether their 
projected loss meets the Tier 2 gross revenue threshold of Sec.  
166.3(h)(1)(ii), providing additional data as noted in Sec.  166 
20(b)(4)(ii). Failing to meet that threshold, applicants should submit 
the data to perform the analysis necessary for the Tier 3 net revenue 
threshold of Sec.  166.3(h)(1)(iii) as given in Sec.  
166.20(b)(4)(iii). The three tiers established in Sec.  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

[[Page 4505]]

necessary in estimating each higher tier. This allows an applicant to 
collect data, and build a case for significant economic loss, as needed 
and determined by the conditions, without requiring additional data. 
Applicants will continue to submit data to demonstrate the emergency 
nature of the pest outbreak including the basis for expected losses in 
quantity, and sometimes quality and/or additional production costs. 
However, applicants no longer need to submit historical economic data 
demonstrating variations in revenues, although historical data may be 
appropriate to define the baseline, routine, or ``without emergency'' 
scenario. The new guidance document that EPA is issuing in conjunction 
with this final rule includes a description of information that EPA 
expects applicants to submit in order to demonstrate an SEL.
    This loss-based approach is designed to capture the economic impact 
of pest activity as it affects the current production season, which 
will be sufficient for most emergency exemption applications. Although 
Sec.  166.3(h)(1) applies the loss-based approach to pest activity 
primarily affecting the current growing season, EPA has reserved the 
authority to use a case-by-case approach in the new Sec.  166.3(h)(2). 
Where EPA determines that the loss-based approach of Sec.  166.3(h)(1) 
would not adequately describe the expected loss, for example long-term 
losses in orchard crops, the Agency would continue to make its 
significant economic loss determinations based on other criteria (i.e., 
a substantial loss or impairment of capital assets, or a loss that 
would affect the long-term financial viability expected from the 
productive activity) where the applicant demonstrates significant 
losses that would not be recognized under Sec.  166.3(h)(1).
    2. Rationale for revised SEL approach. The revised methodology for 
determining an SEL is intended to streamline the data and analytical 
requirements for emergency exemption requests, and allow for 
potentially 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 
believes that the loss-based approach better and more directly permits 
EPA to evaluate the significance of economic losses.
    An analysis of past emergency exemption requests suggests that this 
revised approach will not cause a significant change in the overall 
likelihood of an SEL finding, although findings may differ in 
individual cases. The results of this analysis are discussed in the 
Economic Analysis of the final rule, available in the public docket. 
The analysis shows that in many cases an SEL can be adequately 
demonstrated with less data and without loss of reliability or 
flexibility through the revised methodology. The new approach is 
expected to lead to savings to both applicants and EPA from reduced 
data and analytical burdens. Under the new procedure, applicants may 
elect to submit the 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, as it identifies the most obvious emergencies with less 
data. The loss-based approach requires 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. 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 approach is expected to save applicants time and 
resources in gathering data and preparing submissions. The Agency's 
burden should be reduced due to the simplified approach and clear, 
consistent thresholds.
    Because the loss-based approach in today's final rule shifts the 
focus from annual price variability to actual pest-related losses, it 
is expected to lead to more consistent and transparent 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 new, loss-based 
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.

C. Specifying Invasive Species as Targets under Quarantine Exemptions

    Existing regulations describe four types of emergency exemptions, 
one of which is a quarantine exemption. The purpose of a quarantine 
exemption is stated in 40 CFR 166.2(b) as follows:
    (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 necessarily 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 existing regulations, probably because it was not widely used at 
the time 40 CFR part 166 was promulgated. This final rule adds the term 
``invasive species'' to Sec.  166.2(b) and to Sec.  166.3(d)(3)(i), to 
clarify that the intent of making quarantine exemptions available 
includes the control of invasive species. The rule also adds, at Sec.  
166.3(k), a definition of ``invasive species'' that is derived from 
that used in Executive Order 13112 (64 FR 6183, February 3, 1999).

D. Updating Administrative and Communication Processes

    A number of minor revisions to 40 CFR part 166 are made with this 
final rule to correct errors or update administrative aspects of the 
emergency exemption regulations, particularly in light of the fact that 
the Food Quality

[[Page 4506]]

Protection Act (FQPA), which amended FIFRA and the FFDCA, was enacted 
since the regulations under part 166 were last revised. Each of these 
revisions is made 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 are 
non-substantive or reflect minor changes to the regulatory 
requirements, but all correct, improve, or update the regulations. The 
corrections of typographical or administrative errors or inaccuracies 
are self-explanatory. The 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 existing 
regulations predate FQPA and therefore do not reflect this requirement. 
Four revisions are made to bring 40 CFR part 166 into agreement with 
current practices as required by the FFDCA. Inasmuch as FFDCA section 
408(l)(6) applies to all food-use emergency exemptions, regardless of 
whether its requirements are reflected in 40 CFR part 166, these 
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, this rule amends Sec.  166.3(e) to revise the definition of 
``first food use.'' The existing definition includes an explanation 
that no permanent tolerance or food additive regulation has been 
established for such a use. The word ``permanent'' is removed in the 
revised definition so that any tolerance would be included, and the 
reference to ``food additive regulation'' is removed because, owing to 
the FQPA amendments, EPA no longer issues food additive regulations.
    Second, under Sec.  166.25--Agency Review, the regulations state 
that the review enables EPA to make a determination with respect to 
several items, including the level of residues in or on all food 
resulting from the proposed use. The final rule revises Sec.  
166.25(a)(2) to add the establishment of a time-limited tolerance for 
such residues, where necessary.
    The third revision made necessary by FQPA is to add, under Sec.  
166.40, an additional limitation to the authority of a State or federal 
agency to issue a crisis exemption, namely, that they 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. This revision at Sec.  166.40(c) 
also stipulates that all crisis exemptions be conditioned upon EPA 
confirming that it has no other objection to the use of the pesticide 
under the crisis provisions.
    The fourth change is to remove from Sec.  166.30(b) and Sec.  
166.47 the now-superfluous requirement that EPA directly notify the 
U.S. Food and Drug Administration (FDA), USDA, and State health 
officials. The original 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. Prior to FQPA, EPA did not 
routinely establish tolerances for food use pesticides applied under an 
emergency exemption program. This notification provision served to 
advise other agencies of the exemption and to support field enforcement 
activities. Now, however, with the FQPA requirement that time-limited 
tolerances be established in accordance with FFDCA section 408(l)(6), 
such levels are published in the Federal Register, along with detailed 
background regarding safety of these tolerances, as well as 
incorporated into 40 CFR part 180. Therefore, EPA considers providing 
separate notification to the other regulatory organizations (FDA, USDA, 
and State health officials) on an individual basis redundant to the 
Federal Register notice and incorporation of the regulatory decision in 
the appropriate section of 40 CFR part 180.
    Several revisions are made in this final rule to codify minor 
improvements to the process that have been identified since the 
existing 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 Sec.  166.20, 
``Application for a specific, quarantine, or public health exemption,'' 
paragraph (a)(2)(i)(A) is revised so that an application must include a 
copy of the EPA-approved label for each specific pesticide product 
requested, instead of the existing requirement to include the 
registration number and name of the product. This will facilitate the 
review of applications.
    Next, under Sec.  166.20(a)(3), the final rule adds a new item, and 
revises several of the others, to specify that the conditions of use 
requested in an application must include the maximum number of 
applications, the period of time for which the use is proposed, and 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 in the past where it was not apparent from 
the application, EPA had to contact the applicant to obtain the 
information. Expressly requiring this information in Sec.  166.20(a)(3) 
will expedite review of applications and allow tolerances to be 
established in an orderly fashion.
    Additionally, this rule revises Sec.  166.20(a)(9) 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 repeat 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. This final rule revises Sec.  166.24(a)(6)(i) and Sec.  
166.25(b)(2)(ii) to relax this presumption for repeat emergency 
exemption applications for uses being supported by 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. In many cases, 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, a somewhat slower rate of progress towards registration 
is reasonable for emergency exemptions for uses being supported by the 
IR-4 program. Accordingly, this rule

[[Page 4507]]

revises Sec.  166.24(a)(7)(i) and Sec.  166.25(b)(2)(ii) 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 
other, typically commercial, parties. For uses supported by parties 
other than IR-4, the 3-year presumption in the existing regulations 
remains in effect.
    This rule revises Sec.  166.30(a)(1) to reflect that EPA will not 
process incomplete applications, and that action on such submissions 
will be halted until required additional information is submitted.
    The rule clarifies Sec.  166.32(b) to ensure that applicants submit 
interim use reports for exemptions when requesting a repeated emergency 
exemption prior to the due date of the final report.
    This rule also clarifies the authority of an applicant to issue a 
crisis exemption by specifying in Sec.  166.40(a) that crisis 
exemptions are to be used only for unpredictable emergency conditions. 
This change is strictly for purposes of clarification, as the term 
``unpredictable'' already appears in the introductory language of Sec.  
166.40, and does not represent any intention by EPA to change the 
criteria for crisis exemptions. This rule also adds a paragraph (c) 
under Sec.  166.40, so that the state's authority to exercise the 
crisis exemption is stayed pending verbal confirmation by EPA that a 
tolerance can be established in a timely manner and that the Agency has 
no other objections.
    This final rule also revises Sec.  166.43(a)(1) 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. Section 166.43(a)(1) is 
revised to require advance notification for crisis exemptions by 
applicants. This replaces 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 will 
continue to provide the necessary verbal confirmations as quickly as 
possible, thereby often allowing use of the crisis exemption in less 
than 36 hours. This final rule does not attempt to change the customary 
36-hour timeframe for Agency response to notification. 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. EPA believes that these requests can be reviewed in a timely 
manner through the appropriate use of OPP resources.
    To clarify necessary information for a crisis exemption, this rule 
revises Sec.  166.43(b)(1) and (b)(4), 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 the 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, this rule revises Sec.  166.49(a)(1) through (a)(4) 
and deletes Sec.  166.49(a)(5), to clarify information requirements, 
such as applicant, product used, site treated, and contact information.

VII. Implementation of Final Rule

    This final rule becomes effective March 28, 2006. Applicants 
submitting exemption requests that are received by the Agency after 
publication of the final rule, but before the effective date, will have 
the option of using the revised approaches for re-certification or 
documenting an SEL, or using the outgoing application method and 
approach. Applications received by EPA after the effective date will be 
processed under the approach described in today's final rule. However, 
applicants for exemptions eligible to use a streamlined re-
certification request may still submit a full application, even after 
the effective date. EPA recognizes that persons who have previously 
obtained emergency exemptions have not yet been advised whether those 
emergency exemptions are eligible for the re-certification program. The 
Agency will use submissions received in fiscal year 2005 as the 
baseline year for evaluating whether emergency exemptions are eligible 
for the new re-certification program. As soon as possible, and before 
the effective date of this final rule, EPA intends to share with 
applicants and post on its web page a list of candidate exemptions that 
appear to Agency reviewers to be eligible for the re-certification 
program. Applicants that believe an exemption is eligible for re-
certification may submit a re-certification application prior to EPA's 
release of the eligibility list. However, upon receipt, the Agency must 
agree that it was eligible for re-certification in order to process the 
request in that fashion.
    Applications that have already been received by EPA as of today's 
publication date, January 27, 2006, will be processed and reviewed in 
the context of the existing framework and authorities, unless the 
applicant submits a replacement request under the provisions of the 
final rule. The section 18 pilot program is terminated as a result of 
the promulgation of this final rule.
    Mindful that this national program has many stakeholders, EPA plans 
to provide training on how this final rule affects the application, 
review, and approval process for emergency exemptions. EPA intends to 
hold public meetings and develop information materials to help 
applicants comply with this final rule and help others understand its 
new provisions. A guidance document concerning the re-certification 
process and the new, loss-based approach for determining and 
documenting an SEL is being issued in conjunction with this final rule. 
EPA plans to issue new guidance on other aspects of the final rule, or 
revised guidance on other areas, in the future as it is needed and 
available.

VIII. Related Issues and Emergency Exemption Program Context

A. Pest Resistance Management

    The April 24, 2003 Federal Register Notice, that initiated the 
pilot to test the re-certification and revised SEL processes, indicated 
that EPA was considering addressing pest resistance management (RM) in 
this rulemaking. However, after carefully considering public comments 
on that Notice and re-considering the possibility of emergency 
exemptions for the purpose of resistance management, EPA decided not to 
include such a change in the proposed rule. Additional comments on this 
issue were received in response to the proposed rule and considered by 
the Agency. EPA believes that section 18 is an inappropriate avenue for 
addressing the worthy goal of managing pest resistance, for several 
reasons.
    Some who commented on the proposed rule also stated that exemptions 
for the purpose of RM should be allowed. Some commenters said that 
although the recently enacted Pesticide Registration Improvement Act 
(PRIA) may help bring more RM tools to

[[Page 4508]]

market sooner, it will not be sufficient to address the lack of RM 
tools, particularly for minor crops. While these commenters recognize 
the need to prevent abuse of RM exemptions, and the difficulty in 
developing clear criteria for approval of an exemption for RM, they 
believe that there is ample middle ground between liberally allowing RM 
exemptions and allowing no such exemptions. This general comment was 
made by 19 commenters (nine grower groups, four State lead agencies, 
two education/research groups, two agriculture/food industry groups, 
and two pesticide industry/ registrants).
    Virtually all commenters that addressed RM agree with EPA that any 
potentially successful approach for RM exemptions would be proactive, 
allowing exemptions before resistance has occurred for a particular use 
in the field. Most also agree that predicting and documenting a case of 
resistance would be highly variable and complex. The Agency believes 
that the burden to applicants of preparing a request for an RM 
exemption that included such documentation would be substantially 
higher than the burden of preparing other requests. EPA believes such 
costly and complex burden is contrary to the purpose of this 
rulemaking. Likewise, the burden to EPA of reviewing and deciding on 
such a request would be high, diverting resources from other 
priorities. EPA feels that such a burden is not the best use of Agency 
resources, and that other means of dealing with RM would be both more 
efficient and more appropriate. Furthermore, a need for an RM tool to 
address a future problem arguably does not fit within a conventional 
interpretation of ``emergency.''
    EPA understands the importance of pest resistance management and 
continues to explore how to best use its regulatory and non-regulatory 
authorities to support and facilitate effective RM. The Agency believes 
that RM capabilities will be improved through a multi-faceted approach 
involving incorporating RM considerations into pesticide labeling 
(i.e., Pesticide Registration Notice 2001-5), registering more 
pesticides for minor crops, resistance management education programs, 
crop management and stewardship programs, further crop grouping for 
tolerance setting, and outreach efforts with stakeholders. Under PRIA, 
EPA is making more timely decisions and accelerating the registration 
of many products expected to be useful for RM. EPA's process for 
classifying a pesticide product as ``reduced-risk'' considers RM as an 
important factor. New products that would address significant RM needs 
would reach the market sooner, thereby providing a strong incentive to 
registrants to incorporate RM in their registration submissions. Also, 
the IR-4 process has continued to improve in recent years, identifying 
priority pesticide needs for minor crops and facilitating quicker 
registrations, including many useful RM tools.

B. Endangered Species Considerations

    The existing emergency exemption regulations include information 
requirements for applicants and review requirements for EPA concerning 
threatened and endangered species. In the proposed rule, EPA did not 
propose to revise these requirements. However, a discussion of plans 
for improving the process for ensuring that pesticides used under 
emergency exemptions do not affect threatened and endangered species 
was included in the preamble. One comment submission on the proposed 
rule claimed that EPA's section 18 activities routinely violate the 
Endangered Species Act (ESA). These commenters said that the 
streamlining proposals would make matters worse. The commenters said 
that EPA does not list a single example of consultation with the U.S. 
Fish and Wildlife Service (FWS) or the National Marine Fisheries 
Service (NMFS) in the course of a section 18 review. They also cite a 
recent letter from FWS to EPA Region 2 stating that the section 18 
process insufficiently addresses EPA's consultation obligations under 
ESA. This comment was made by 13 environmental/public interest groups 
in a joint submission, and no other comments were received on this 
issue.
    EPA disagrees that this final rule in any way lessens protections 
for threatened and endangered species. As noted, the regulatory 
provisions regarding submission and consideration of information 
relating to listed species have not been altered by the rule nor have 
EPA's obligations under the ESA been altered. EPA also disagrees that 
its plans for improving its processes will make matters worse. Indeed, 
EPA plans, as discussed in the proposal, explain that the Agency and 
FWS and NMFS (the Services) have developed mechanisms to provide 
increased and more expeditious scrutiny to these issues than the Agency 
has in the past.
    The Services, in collaboration with EPA and USDA, have developed a 
counterpart regulation (50 CFR part 402), that would make the process 
of consultation about EPA actions involving pesticides - including any 
necessary consultations for emergency exemptions under section 18 - 
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. The Services agreed 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 section 7 of the ESA and 
implementing regulations.'' (69 FR at 47735).
    EPA looks closely at potential ecological risks of pesticide use in 
connection with decisions on requests for emergency exemptions. As a 
result of the Services' acceptance of the Agency's ecological risk 
assessment process, the Agency intends to provide new guidance and to 
work closely with applicants for emergency exemptions, to improve the 
information submitted concerning threatened and endangered species and 
possible effects on them of the requested use. EPA anticipates that 
these measures will 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. As EPA develops this new guidance, 
EPA will look for opportunities to enhance consideration of these 
impacts in its emergency exemption decision process, including any need 
to consult with FWS and NMFS.

C. Improving Transparency in Decisions

    One of the ongoing challenges for EPA in relation to the emergency 
exemption program is to ensure that State agencies and interested 
stakeholders have useful, accurate, and timely information on the 
status of applications they are interested in as well as other key 
information that could help clarify pesticide use directions and 
facilitate observance of necessary safety restrictions that have been 
placed on the exempted use pattern. Along these lines, EPA is striving 
to upgrade the quality of the information available to States, 
pesticides users, extension agents and other key stakeholders under the 
section 18 program and also to enhance the transparency of this program 
in general. One activity that the Agency has developed in this area is 
a searchable section 18 data system that is supported on the Office of 
Pesticide Programs' web page. This data system, located at http://cfpub1.epa.gov/oppref/section18/search.cfm permits basic queries of

[[Page 4509]]

submissions and overall status information for emergency exemption 
applications. EPA also publishes information notices in the Federal 
Register in accordance with 40 CFR 166.30. These are retrospective 
summaries of the section 18 activity sorted and presented on the basis 
of the requesting agency.
    EPA is also exploring other means of providing useful status and 
regulatory information for emergency exemptions that involve pest 
management concerns of national significance. For instance, in 
connection with the response to the newly identified select agent that 
causes the plant disease soybean rust, EPA has developed a special web 
page (http://www.epa.gov/oppfod01/cb/csb_page/updates/soybean_rust.htm) that provides the public with a comprehensive listing of all 
of the products that have claims for control of the soybean rust 
pathogen. Soybean rust is a serious disease of soybean crops and has 
been identified as a select agent under the Agricultural Bioterrorism 
Control Act. Due to the national scope of the soybean industry, there 
has been significant interest on the part of the public in learning 
which pesticides have regulatory clearances for this pest. Finally, EPA 
is exploring another initiative for sharing information on the section 
18 program more extensively. Specifically, EPA is investigating ways to 
post more comprehensively its decision documents under this program. 
Section 18 decision letters are public documents which the Agency 
transmits to the requesting state agency. However, certain stakeholders 
have requested copies of these materials directly. To this end, EPA has 
plans for posting its decision documents under section 18 on the 
Agency's web page.

IX. FIFRA Review Requirements

    In accordance with FIFRA section 25(a), this final 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 final rule, and no comments were received 
from any of the congressional committees or USDA.

X. Statutory and Executive Order Reviews

A. Executive Order 12866

    Under Executive Order 12866, entitled Regulatory Planning and 
Review (58 FR 51735, October 4, 1993), the Office of Management and 
Budget (OMB) has determined that this final rule is not a ``significant 
regulatory action'' under section 3(f) of the Executive Order.
    In addition, EPA has prepared an economic analysis, entitled 
Economic Analysis of the Pesticides Emergency Exemption Process 
Revisions, of the potential regulatory impacts of this final action on 
those affected. A copy of this Economic Analysis is available in the 
public docket for this action and is briefly summarized here.
    This action is not expected to cause any significant adverse 
economic impacts. There are no direct impacts on local governments or 
small entities, because this action directly affects only Federal and 
State agencies that petition EPA for section 18 use authorization, 
neither of which qualify as a small entity under the Regulatory 
Flexibility Act (RFA). The only substantive impacts expected are burden 
reductions to applicants 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 final rule, 
based on predicted future applications affected by the regulatory 
revisions, EPA estimates the annual combined savings for applicants and 
EPA of around $1.5 million; nearly $1.2 million from re-certification, 
and over $0.3 million from changing to the loss-based method of 
determining SEL.

B. Paperwork Reduction Act (PRA)

    This action does not impose any new information collection burden 
that would require additional approval by OMB under the Paperwork 
Reduction Act (PRA), 44 USC 3501 et seq. This 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).
    The annual respondent burden for the collection of information 
currently approved by OMB is estimated to average 99 hours per 
application. 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 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 number assigned to 
this final rule (No. 2070-0032) will be listed in 40 CFR part 9.

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 rulemaking 
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 final 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 final rule only 
applies to Federal and State government agencies, the only entities 
that can petition the EPA under FIFRA section 18. As such, this action 
will not impact local or tribal governments or the private sector, and 
will not significantly or uniquely affect small governments. In 
addition, as described in Unit X.A., this final rule is expected to 
result in an overall reduction of existing costs for applicants and EPA 
of around $1.5 million. Accordingly, this rule is not subject to the 
requirements of sections 202 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 final rule does 
not have ``federalism implications,'' because it

[[Page 4510]]

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 final 
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 final rule. In the spirit of the Order, and consistent with EPA 
policy to promote communications between the Agency and State 
governments, EPA specifically solicited comment from State officials on 
the proposed rule.

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 final rule does not have tribal 
implications because it will not have any effect 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 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 final rule.

G. Executive Order 13211

    This final rule is not subject to Executive Order 13211, Actions 
Concerning Regulations that Significantly Affect Energy Supply, 
Distribution, or Use (66 FR 28355, May 22, 2001) because it is not 
designated as an ``economically significant'' regulatory action as 
defined by Executive Order 12866 (see Unit X.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 final rule because this action is not 
designated as an ``economically significant'' regulatory action as 
defined by Executive Order 12866 (see Unit X.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, sampling procedures) that are developed or adopted by 
voluntary consensus standards bodies. This final rule does not impose 
any technical standards that would require EPA to consider any 
voluntary consensus standards.

J. Executive Order 12898

    This final 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.

XI. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et seq., generally 
provides that before a rule may take effect, the Agency promulgating 
the rule must submit a rule report that includes a copy of the rule to 
each House of the Congress and the Comptroller General of the United 
States. EPA will submit a report containing this rule and other 
required information to the U.S. Senate, the U.S. House of 
Representatives, and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register. This rule is not a 
``major rule'' as defined by 5 U.S.C. 804(2).

List of Subjects in 40 CFR Part 166

    Environmental protection, Administrative practice and procedure, 
Agricultural commodities, Pesticides and pests, Reporting and 
recordkeeping requirements.


    Dated: January 13, 2006.
Stephen L. Johnson,
Administrator.

0
Therefore, 40 CFR chapter I is amended as follows:

PART 166--[AMENDED]

0
1. The authority citation for part 166 continues to read as follows:

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

0
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.
* * * * *
0
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:


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 or 
other output, one or more of the following:
    (i) 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 any pest activity where EPA determines that the criteria in 
paragraph

[[Page 4511]]

(h)(1) would not adequately describe the expected loss, 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 means the Interregional Research Project 
No. 4, a cooperative effort of the state land grant universities, the 
U.S. Department of Agriculture 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.
0
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 
requested; and
* * * * *
     (3) Description 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) 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 may submit re-certification applications relying on 
previously submitted information to satisfy the information 
requirements of paragraphs (a)(1) through (a)(10) of this section, and 
of paragraphs (b)(1) through (b)(4) of this section, where all of the 
following conditions are met:
    (i) An exemption was granted for the same pesticide at the same 
site to the same applicant the previous year;
    (ii) The emergency condition could reasonably be expected to 
continue for longer than 1 year;
    (iii) EPA has not declared the use ineligible for re-certification;
    (iv) The use is not subject to public notice pursuant to Sec.  
166.24(a)(1) through (a)(6);
    (v) The applicant certifies that all of the following are true:
    (A) The emergency condition described in the preceding year's 
application continues to exist;
    (B) Except as expressly identified, all information submitted in 
the preceding year's application is still accurate;
    (C) Except as expressly identified, the proposed conditions of use 
are identical to the conditions of use EPA approved for the preceding 
year;
    (D) 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;
    (E) The applicant is not aware of any alternative chemical or non-
chemical practice that may offer a meaningful level of pest control, or 
has provided documentation that each such known practice does not 
provide adequate control or is not economically or environmentally 
feasible.
* * * * *
0
5. Section 166.24 is amended by revising the introductory text of 
paragraph (a), redesignating paragraphs (a)(6) and (a)(7) as paragraphs 
(a)(7) and (a)(8) respectively, adding a new paragraph (a)(6), and 
revising newly redesignated paragraph (a)(7)(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) The application proposes use of a pesticide which:
    (i) Was voluntarily canceled under section 6(f) of the Act, and
    (ii) Is intended for a use that poses a risk similar to the risk 
posed by any use of the pesticide which was voluntarily canceled under 
section 6(f);
    (7) * * *
    (i) An emergency exemption has been requested or approved for that 
use in any 3 previous years, or any 5 previous years if the use is 
supported by the IR-4 program, and
* * * * *
0
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.

[[Page 4512]]

    (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.
0
7. Section 166.30 is amended by revising paragraph (a)(1), removing 
paragraph (b), and redesignating 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.
* * * * *
0
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:
* * * * *
0
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 objection.
0
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 in advance of utilization of the crisis 
provisions.
* * * * *
    (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]

0
11. Section 166.47 is removed.
0
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. 06-743 Filed 1-26-06; 8:45 am]
BILLING CODE 6560-50-S