[Federal Register Volume 71, Number 195 (Tuesday, October 10, 2006)]
[Proposed Rules]
[Pages 59592-59612]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-16575]



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Part II





Department of the Interior





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Office of Surface Mining Reclamation and Enforcement



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30 CFR Parts 701, 773, 774, 778, 843, and 847



 Ownership and Control; Permit and Application Information; Transfer, 
Assignment, or Sale of Permit Rights; Proposed Rule

  Federal Register / Vol. 71, No. 195 / Tuesday, October 10, 2006 / 
Proposed Rules  

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DEPARTMENT OF THE INTERIOR

Office of Surface Mining Reclamation and Enforcement

30 CFR Parts 701, 773, 774, 778, 843, and 847

RIN 1029-AC52


Ownership and Control; Permit and Application Information; 
Transfer, Assignment, or Sale of Permit Rights

AGENCY: Office of Surface Mining Reclamation and Enforcement, Interior.

ACTION: Proposed Rule.

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SUMMARY: We, the Office of Surface Mining Reclamation and Enforcement 
(OSM), propose to revise certain provisions of our December 19, 2000, 
final ``ownership and control'' and related rules, as well as our rules 
pertaining to the transfer, assignment, or sale of permit rights. More 
specifically, we propose to amend our definitions pertaining to 
ownership, control, and transfer, assignment or sale of permit rights 
and to revise our regulatory provisions governing: permit eligibility 
determinations; improvidently issued permits, ownership or control 
challenges; post-permit issuance actions and requirements; transfer, 
assignment, or sale of permit rights; application and permit 
information; and alternative enforcement. Additionally, we propose to 
remove our current rules pertaining to improvidently issued State 
permits. In order to satisfy our obligations under a settlement 
agreement we entered into with the National Mining Association, we 
previously issued two proposed rules covering these subjects. 
(Ownership and Control Settlement Rule, December 29, 2003; Transfer, 
Assignment, or Sale of Permit Rights, January 26, 2005.) After 
receiving comments on those proposed rules, and holding an outreach 
meeting with our State co-regulators to discuss the ramifications of 
finalizing the proposed rules, we have decided to alter the proposals 
in certain respects and to propose additional revisions. We have also 
decided to combine the two prior proposals into one new proposed rule, 
which will allow the public to review and comment on the proposed 
revisions in context. As with the two prior proposals, our primary 
objective in issuing this proposed rule is to introduce greater clarity 
to our regulations and to achieve regulatory stability with regard to 
aspects of our regulatory program that have been the subject of 
litigation for many years. This proposed rulemaking does not suspend or 
withdraw any of the provisions of our 2000 final ownership and control 
rule or our current rules pertaining to the transfer, assignment, or 
sale of permit rights. We are, however, withdrawing our December 29, 
2003, proposed rule and our January 26, 2005, proposed rule. This 
proposed rule is authorized under the Surface Mining Control and 
Reclamation Act of 1977, as amended (SMCRA or the Act).

DATES: Written comments: Comments on the proposed rule must be received 
by or before 4:30 p.m., Eastern Time, on December 11, 2006 to ensure 
our consideration.
    Public hearings: Upon request, we will hold a public hearing on the 
proposed rule at a date, time, and location to be announced in the 
Federal Register before the hearing. We will accept requests for a 
public hearing until 4:30 p.m., Eastern Time, on October 31, 2006. If 
you wish to attend a hearing, but not speak, you should contact the 
person identified under FOR FURTHER INFORMATION CONTACT before the 
hearing date to verify that the hearing will be held. If you wish to 
attend and speak at the hearing, you should follow the procedures under 
``III. Public Comment Procedures.''

ADDRESSES: You may submit comments, identified by docket number 1029-
AC52, by any of the following methods:
     E-mail: [email protected]. Include docket number 1029-AC52 
in the subject line of the message.
     Mail/Hand Delivery/Courier: Office of Surface Mining 
Reclamation and Enforcement, Administrative Record, Room 252, 1951 
Constitution Avenue, NW., Washington, DC 20240.
     Federal e-Rulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
    You may review the docket (administrative record) for this 
rulemaking, including comments received in response to this proposed 
rule, at the Office of Surface Mining Reclamation and Enforcement, 
Administrative Record Office, Room 101, 1951 Constitution Avenue, NW., 
Washington, DC 20240. The Administrative Record Office is open Monday 
through Friday, excluding holidays, from 8 a.m. to 4 p.m. The telephone 
number is (202) 208-2847.
    Instructions: All written submissions must include the agency name 
and docket number for this rulemaking. For detailed instructions on 
submitting comments and additional information on the rulemaking 
process, see ``III. Public Comment Procedures'' in the SUPPLEMENTARY 
INFORMATION section of this notice.
    If you wish to comment on the information collection aspects of 
this proposed rule, submit your comments to the Office of Management 
and Budget, Office of Information and Regulatory Affairs, Attention: 
Interior Desk Officer, via electronic mail, to [email protected] 
or via telefacsimile at (202) 395-6566.
    You may submit a request for a public hearing orally or in writing 
to the person and address specified under FOR FURTHER INFORMATION 
CONTACT. We will announce the address, date, and time for any hearing 
in the Federal Register before the hearing. If you are disabled and 
require reasonable accommodation to attend a public hearing, you should 
contact the person listed under FOR FURTHER INFORMATION CONTACT.

FOR FURTHER INFORMATION CONTACT: Earl D. Bandy, Jr., Office of Surface 
Mining Reclamation and Enforcement, Appalachian Region, Applicant/
Violator System Office, 2679 Regency Road, Lexington, Kentucky 40503. 
Telephone: (859) 260-8424 or (800) 643-9748. E-mail: [email protected].

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Background to the Proposed Rule
II. Discussion of the Proposed Rule
    A. Section 701.5--Definition: Control or Controller
    B. Section 701.5--Definition: Own, Owner, or Ownership
    C. Section 701.5--Definition: Transfer, Assignment, or Sale of 
Permit Rights
    D. Section 773.3--Information Collection
    E. Section 773.7--Review of Permit Applications
    F. Section 773.8--General provisions for Review of Permit 
Application Information and Entry of Information into AVS
    G. Section 773.9--Review of Applicant and Operator Information
    H. Section 773.10--Review of Permit History
    I. Section 773.12--Permit Eligibility Determination
    J. Section 773.14--Eligibility for Provisionally Issued Permits
    K. Section 773.21--Initial review and Finding Requirements for 
Improvidently Issued Permits
    L. Section 773.22--Notice Requirements for Improvidently Issued 
Permits
    M. Section 773.23--Suspension or Rescission Requirements for 
Improvidently Issued Permits
    N. Section 773.26--How to Challenge an Ownership or Control 
Listing or Finding
    O. Section 773.27--Burden of proof for ownership or control 
challenges
    P. Section 773.28--Written Agency Decisions on Challenges to 
Ownership or Control Listings or Findings
    Q. Section 774.9--Information Collection
    R. Section 774.11--Post-permit Issuance Requirements for 
Regulatory Authorities

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and Other Actions Based on Ownership, Control, and Violation 
Information
    S. Section 774.12--Post-permit Issuance Information Requirements 
for Permittees
    T. Section 774.17--Transfer, Assignment, or Sale of Permit 
Rights
    U. Section 778.8--Information Collection
    V. Section 778.11--Providing Applicant and Operator Information
    W. Section 843.21--Procedures for Improvidently Issued State 
Permits
    X. Sections 847.11 and 847.16--Criminal penalties and civil 
actions for relief
III. Clarifications to the Preamble to Our 2000 Ownership and 
Control Final Rule
IV. Public Comments Procedures
V. Procedural Determinations

I. Background to the Proposed Rule

    This proposed rule would amend certain provisions of our 2000 final 
ownership and control rule (65 FR 79582) and our current rules 
pertaining to the transfer, assignment, or sale of permit rights at 30 
CFR 701.5 (definition of transfer, assignment, or sale of permit 
rights) and 30 CFR 774.17 (regulatory requirements). The 2000 final 
rule, which took effect for Federal programs (i.e., SMCRA programs for 
which OSM is the regulatory authority) on January 18, 2001, primarily 
addresses issues concerning and related to ownership or control of 
surface coal mining operations under section 510(c) of SMCRA. 30 U.S.C. 
1260(c). Under section 510(c), an applicant for a permit to conduct 
surface coal mining and reclamation operations (hereafter ``applicant'' 
or ``permit applicant'') is not eligible to receive a permit if the 
applicant owns or controls any surface coal mining operation that is in 
violation of SMCRA or other applicable laws. In addition to 
implementing section 510(c), the rule also addresses, among other 
things, permit application information requirements, post-permit 
issuance information requirements, entry of information into the 
Applicant/Violator System (AVS), application processing procedures, and 
alternative enforcement. See generally 65 FR 79661-71. Our current 
rules pertaining to the transfer, assignment, or sale of permit rights 
contain, among other things, application submission, review, and 
approval criteria. We have historically viewed our transfer, 
assignment, or sale rules as related to our ownership and control rules 
because our current definition of transfer, assignment, or sale of 
permit rights (30 CFR 701.5) incorporates ownership and control 
concepts.
    On February 15, 2001, the National Mining Association (NMA) filed a 
lawsuit in the U.S. District Court for the District of Columbia in 
which it challenged our 2000 final rule on multiple grounds. NMA's 
lawsuit included a challenge to our transfer, assignment, or sale 
rules. Although the 2000 rule did not include any amendments to our 
transfer, assignment, or sale rules, NMA argued that we reopened those 
rules by proposing to revise them in the proposed rule that preceded 
the 2000 final rule. See 63 FR 70580, 70591, 70601 (Dec. 21, 1998).
    As we explained in our 2003 proposed rule, NMA's lawsuit is the 
latest chapter in litigation concerning ownership and control and 
related issues. Litigation in this area--involving, at various times, 
OSM, State regulatory authorities (administering OSM-approved State 
programs), NMA, and environmental groups--has been contentious and 
ongoing, virtually uninterrupted, since at least 1988. The 2000 final 
rule, which we are proposing to revise, replaced a 1997 interim final 
rule (62 FR 19451), which was partially invalidated by the U.S. Court 
of Appeals for the District of Columbia Circuit. National Mining Ass'n 
v. Dep't of the Interior, 177 F.3d 1 (DC Cir. 1999) (NMA v. DOI II). 
The interim final rule replaced three sets of predecessor regulations 
dating back to 1988 and 1989 (53 FR 38868, 54 FR 8982, 54 FR 18438), 
which were invalidated by the DC Circuit because the court found that 
one aspect of the rules was inconsistent with section 510(c) of SMCRA. 
National Mining Ass'n v. Dep't of the Interior, 105 F.3d 691 (D.C. Cir. 
1997) (NMA v. DOI I). The preamble to the 2000 final rule contains a 
detailed discussion of the prior rules and the related litigation. See 
generally 65 FR 79582-84.
    This ongoing cycle of litigation has created a great deal of 
regulatory uncertainty for OSM, State regulatory authorities 
(administering OSM-approved State programs), the regulated community, 
and the public in general. Thus, in an effort to bring the litigation 
between OSM and NMA to an end, we entered into negotiations with NMA in 
an attempt to settle NMA's challenge to the 2000 final rule. 
Ultimately, the parties were able to settle all of the issues presented 
in NMA's rule challenge. Under the terms of the settlement, we agreed 
to publish two proposed rules in the Federal Register in accordance 
with the Administrative Procedure Act's standard notice and comment 
procedures. We did not agree to finalize any of the provisions as 
proposed. In order to fulfill our obligations under the settlement 
agreement, we published the first of the proposed rules--relating to 
ownership and control and related issues--on December 29, 2003. 68 FR 
75036 (2003 proposed rule). The public comment period, as extended, 
closed on March 29, 2004. We published the second proposed rule--
relating to the transfer, assignment, or sale of permit rights--on 
January 26, 2005. 70 FR 3840 (2005 proposed rule). The public comment 
period, as extended, closed on April 15, 2005. In the settlement 
agreement, we also agreed to publish certain clarifications to our 
preamble supporting the 2000 final rule. We published those 
clarifications in the preamble to our December 29, 2003 proposed rule. 
68 FR 75043. However, because we today withdraw our 2003 proposed rule 
(as well as our 2005 proposed rule), we are repeating the 
clarifications in today's proposed rule.
    After the comment periods had closed on the two proposed rules 
described above, we reviewed all comments received and decided it was 
appropriate to meet with representatives of our State co-regulators 
before taking further action on the two proposals. States with OSM-
approved SMCRA programs have primary responsibility for the regulation 
of surface coal mining and reclamation operations within their State 
and must have State rules that are consistent with, and no less 
stringent than, our national rules. Thus, because any new national 
rules could directly affect the primacy States, we deemed it important 
to meet with the States prior to promulgating any new rules. We met 
with the State representatives from June 7-9, 2005, in Cincinnati, OH. 
The results of the outreach meeting are detailed in a report that is 
included in the administrative record supporting this rulemaking 
initiative. After our outreach meeting with the States, we also met 
with representatives of NMA, as a courtesy, to inform them of the 
status of, and our potential future actions with regard to, the two 
proposed rules we issued in accordance with the settlement agreement. 
We deemed this meeting appropriate because the litigation NMA 
instituted over our 2000 final rule is still pending in Federal 
district court, and the parties are still required to file periodic 
joint status reports with the court.
    After meeting with the States, we conducted further internal 
research and deliberations and reassessed our options. Given the 
historic interrelatedness of our ownership and control and transfer, 
assignment, or sale rules, we decided it was best to combine the topics 
covered in the two proposed rules and issue one, new reproposal. This 
approach will allow the public to view the proposed changes in context 
and provide more meaningful comments. With respect to the ownership and 
control amendments we

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propose today, we have considered the comments received on our 2003 
proposed rule and additional input from the States and have concluded 
that, with a few exceptions, we do not need to deviate substantially 
from our 2003 proposal. (We note any significant departures in the 
discussion of the proposed rule, below.) However, our proposed 
transfer, assignment, or sale amendments (discussed under headings C 
and T, below) do differ from our 2005 proposal in material respects.
    As with the 2003 and 2005 proposed rules, our settlement agreement 
with NMA does not obligate us to issue a final rule based on this 
proposal. We will give due consideration to any public comments 
received on the proposed rule before deciding whether to issue a final 
rule and whether to finalize any provisions as proposed. We view this 
rulemaking initiative as an opportunity to ensure we and our State 
counterparts have the tools we need to enforce SMCRA, clarify ambiguous 
provisions in our regulations, and reduce reporting burdens on the coal 
mining industry and regulatory authorities. We are hopeful that any 
final rule resulting from this proposal will introduce a measure of 
regulatory stability to areas that have been in flux since at least 
1988.

II. Discussion of the Proposed Rule

    In this section we discuss the proposed revisions to our rules. 
With relatively few modifications, we are carrying forward the proposed 
ownership and control and related amendments that were the subject of 
our 2003 proposed rule, which was based on our settlement agreement 
with NMA. With regard to the transfer, assignment, or sale issues 
discussed under headings C and T, below, the settlement did not require 
us to propose any specific regulatory language; we committed only to 
propose new transfer, assignment, or sale rules. While we are carrying 
forward some aspects of the proposed transfer, assignment, or sale 
amendments from our 2005 proposed rule, including the key conceptual 
change, today's proposal does differ from the 2005 proposal in some 
material respects.
    Following are discussions of our proposed revisions to certain of 
our definitions at 30 CFR 701.5 and to our rules at 30 CFR parts 773, 
774, 778, 843, and 847.

A. Section 701.5--Definition: Control or Controller

    In the 2000 final rule, we defined control or controller in terms 
of certain circumstances or relationships that establish a person's 
control of a surface coal mining operation. We also provided examples 
of persons who may be, but are not necessarily, controllers. NMA 
challenged the definition of control or controller on multiple grounds, 
including allegations that the definition is vague, arbitrary and 
capricious, and contrary to NMA v. DOI II. Given the alleged vagueness 
of the definition, NMA also objected to the requirement that an 
applicant must list all of its controllers in a permit application.
    In order to settle this claim, we agreed to propose removing from 
the definition of control or controller at 30 CFR 701.5 the following: 
all of paragraph (3) (general partner in a partnership); all of 
paragraph (4) (person who has the ability to commit financial or real 
property assets; from paragraph (5), the phrase ``alone or in concert 
with others,'' the phrase ``indirectly or directly,'' and all of the 
examples at paragraphs (5)(i) through (5)(vi). Both parties agreed that 
if we adopted the proposed revisions, the remaining portion of the 
definition would still allow a regulatory authority to reach any person 
or entity with the ``ability'' to determine the manner in which a 
surface coal mining operation is conducted. Both parties also agreed 
that the ``ability to determine'' standard could encompass indirect and 
direct control, as well as control in concert with others, where there 
is actual ability to control. We are carrying this proposal forward 
from our 2003 proposal.
    Despite our renewed proposal to remove two categories of 
controllers from the definition of control or controller (general 
partner in a partnership; person who has the ability to commit 
financial or real property assets), and the list of examples of persons 
who may be controllers, we stress that, under this proposal, all of 
these persons may still be controllers. In fact, general partners and 
persons who can commit assets are almost always controllers. See, e.g., 
NMA v. DOI II, 177 F.3d at 7. However, because these persons are 
already covered under the ``ability to determine'' standard, we propose 
to remove them from the regulatory text in order to simplify the 
definition. Likewise, although we propose to remove the examples of 
controllers, these persons may still be controllers if they in fact 
have the ability to determine the manner in which a surface coal mining 
operation is conducted. In our experience implementing section 510(c) 
of SMCRA since 1977, the persons identified in the examples are often 
controllers. Therefore, our discussion of these examples in the 
preamble to the 2000 final rule remains instructive, though it is 
important to remember that these examples are not exhaustive. See 65 FR 
79598-600.
    In today's proposed rulemaking, our proposed revision of the 
definition of control or controller is coupled with a proposal to 
remove the requirement to list all controllers in a permit application 
under current 30 CFR 778.11, which is also carried forward from our 
2003 proposal. Instead, as discussed in more detail under heading V, 
below, we propose to modify the information disclosure requirements of 
30 CFR 778.11 so that they more closely resemble certain application 
information requirements of section 507 of SMCRA. We propose this 
revision to the permit application information requirements in order to 
establish an objective standard for both applicants (who must submit 
certain information in a permit application) and regulatory authorities 
(who review applications for completeness and compliance with the Act). 
This proposed revision would also reduce the information collection 
burden for both permit applicants and regulatory authorities.
    The ``ability to determine'' standard discussed above gives 
regulatory authorities flexibility to consider all of the relevant 
facts, on a case-by-case basis, in determining whether control is 
present; regulatory authorities also have the leeway to follow control 
wherever it may exist in a series of business relationships. However, 
while it is important for regulatory authorities to retain this 
flexibility and leeway, it is difficult to have an objective 
information disclosure standard based on this type of definition. By 
removing the requirement for applicants to list all of their 
controllers in a permit application, this proposal would greatly reduce 
any uncertainty or subjectivity associated with the relevant permit 
information disclosure requirements. In sum, the proposals discussed 
above would give regulatory authorities the flexibility they need to 
enforce the Act, while simultaneously making the permit information 
requirements more objective and less burdensome.

B. Section 701.5--Definition: Own, Owner, or Ownership

    In its judicial challenge, NMA claimed that the definition of own, 
owner, or ownership at 30 CFR 701.5 in our 2000 final rule is 
inconsistent with SMCRA, arbitrary and capricious, and contrary to NMA 
v. DOI II. NMA also took issue with the ``downstream'' reach of the 
rule, as it pertains to ownership. The term ``downstream,'' as used by 
the

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DC Circuit in the NMA v. DOI I and NMA v. DOI II litigation, refers to 
surface coal mining operations that are down a corporate (or other 
business) chain from an applicant. For example, if an applicant has a 
subsidiary, the subsidiary would be considered ``downstream'' from the 
applicant; by contrast, if an applicant has a parent company, the 
parent company would generally be considered ``upstream'' from the 
applicant. NMA's claim pertained to how far downstream a regulatory 
authority can look when making a permit eligibility determination based 
on ownership (as distinct from control) of a surface coal mining 
operation.
    In order to settle NMA's claim, we agreed to propose to revise the 
regulatory definition of own, owner, or ownership at 30 CFR 701.5 and 
the provision at 30 CFR 773.12(a)(2) that governs the downstream reach 
of the definition when making a permit eligibility determination. Our 
first proposed revision is to the definition itself. The definition, at 
30 CFR 701.5, includes persons ``possessing or controlling in excess of 
50 percent of the voting securities or other instruments of ownership 
of an entity.'' We concede the definition could be confusing in that it 
uses the word ``controlling,'' which is an intrinsic part of the 
separately defined term control or controller. In order to remove any 
potential confusion, we propose to add the term ``owning of record'' in 
place of ``possessing or controlling.'' The term ``owning of record'' 
is a variant of ``owners of record,'' which is found in section 507(b) 
of the Act. Thus, regulatory authorities and the regulated industry 
will be familiar with the term and its meaning. This proposed revision, 
which is carried forward from our 2003 proposal, would not change the 
substance of our current definition of own, owner, or ownership.
    Our second proposed revision would affect current 30 CFR 
773.12(a)(2), which addresses the downstream reach of the definition 
under the rules pertaining to permit eligibility. In NMA v. DOI II, the 
U.S. Court of Appeals for the District of Columbia Circuit clearly held 
that we can deny a permit based on limitless ``downstream'' control 
relationships. NMA v. DOI II, 177 F.3d at 4-5. That is, if an applicant 
indirectly controls an operation with a violation, through its 
ownership or control of intermediary entities, the applicant is not 
eligible for a permit. Id. at 5. The operation with a violation can be 
limitlessly downstream from the applicant. While we believe the court's 
logic arguably extends to ownership, the NMA v. DOI II decision is not 
entirely clear on this point. See proposed 30 CFR 773.12 for greater 
discussion concerning the effects of the proposed definition on permit 
eligibility determinations.
    Our current rules allow us to reach ``downstream'' with regard to 
both ownership and control. Thus, under the current rules, we can deny 
a permit if an applicant indirectly owns an operation in violation of 
SMCRA or other applicable laws. The operation in violation can be 
infinitely downstream from the applicant--meaning that ownership of the 
operation can be indirect, through intermediary entities--as long as 
there is an uninterrupted chain of ownership between the applicant and 
the operation. NMA argued that this provision is contrary to the plain 
meaning of SMCRA and violates principles of corporate law. NMA claimed 
that ownership of a corporation does not equate to ownership of the 
corporation's assets (including mining operations). Thus, according to 
NMA, we should be able to deny a permit based on ownership only if one 
of the applicant's own operations has a violation.
    While we do not necessarily agree with NMA's analysis, in order to 
settle this claim, we agreed to propose a regulatory revision at 30 CFR 
773.12(a), the effect of which would be to limit the reach of permit 
denials based on ownership to ``one level down'' from the applicant. 
For example, if an applicant directly owns an entity with an unabated 
or uncorrected violation of SMCRA or other applicable laws--meaning 
there are no intermediary entities between the applicant and the entity 
with a violation--the applicant would not be eligible for a permit. In 
other words, the rule would reach one level down from the applicant to 
the entity the applicant owns. However, if the applicant indirectly 
owns an entity with a violation--meaning that there is at least one 
intermediary entity between the applicant and the entity with a 
violation--the applicant would not be ineligible for a permit based on 
ownership of the entity with violations. Of course, the same applicant 
would be ineligible for a permit if it controlled the violator entity. 
This proposed revision is also carried forward from our 2003 proposed 
rule.
    We do not believe this approach is compelled by either SMCRA or the 
decision in NMA v. DOI II. However, we do believe it is a reasonable 
interpretation of the Act. Moreover, with regard to control, the rules 
for determining permit eligibility will continue to reach limitlessly 
``downstream.'' That is, in determining an applicant's eligibility for 
a permit, we may continue to consider violations at ``downstream'' 
operations, as long as there is control by the applicant. Because we 
can still deny a permit based on indirect control of an operation with 
a violation, through intermediary entities, our proposal to limit the 
downstream reach of ownership will not impair our ability to adequately 
enforce section 510(c) of the Act. The proposed revision at 30 CFR 
773.12(a) that pertains to the downstream reach of the definition of 
own, owner, or ownership is further discussed under heading I, below.

C. Section 701.5--Definition: Transfer, Assignment, or Sale of Permit 
Rights

    As mentioned above, in order to settle the litigation instituted by 
NMA, we agreed to propose new transfer, assignment, or sale rules. In 
accordance with the settlement agreement, we published a proposed rule 
on January 26, 2005. 70 FR 3840. In that proposed rule, we proposed 
fairly sweeping changes to our existing regulations. More specifically, 
we proposed to: revise our regulatory definitions of transfer, 
assignment, or sale of permit rights and successor in interest at 30 
CFR 701.5; revise our regulatory provisions at 30 CFR 774.17 relating 
to the transfer, assignment, or sale of permit rights; and create, for 
the first time, separate rules for successors in interest.
    At various points in the preamble to our 2005 proposed rule, we 
expressly invited comments as to whether such major changes are 
warranted given that the existing regulatory scheme has been in 
existence for more than 25 years. In response, a number of commenters 
suggested that the broad conceptual changes we proposed are not 
warranted. Several commenters stated that our statutory rationales for 
some of the proposed changes, including our reading of the legislative 
history, were flawed. Further, commenters suggested that we did not 
achieve our primary purpose of providing greater clarity in our 
transfer, assignment, or sale regulations. Upon consideration of these 
and other comments, and input from our State co-regulators, we have 
come to believe that we can achieve our purpose of simplifying and 
clarifying our regulations through more modest revisions to our 
existing rules. As a result, today we propose to revise our current 
definition of transfer, assignment, or sale of permit rights at section 
701.5 but to keep our existing regulatory requirements for transfers, 
assignments, or sales of permit rights

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largely intact. As with our 2005 proposed rule, we also seek to 
distinguish clearly the circumstances that will trigger a transfer, 
assignment, or sale of permit rights as opposed to an information 
update under 30 CFR 774.12 (see heading S, below).
    Section 511(b) of SMCRA, 30 U.S.C. 1261(b), provides that ``[n]o 
transfer, assignment, or sale of permit rights granted under any permit 
issued pursuant to this Act shall be made without the written approval 
of the regulatory authority.'' Under our current definition, transfer, 
assignment, or sale of permit rights means ``a change in ownership or 
other effective control over the right to conduct surface coal mining 
operations under a permit issued by the regulatory authority.'' We 
propose to revise our regulatory definition of transfer, assignment, or 
sale of permit rights to mean a change of a permittee. Our proposal is 
informed by a decision of the Department of the Interior's Office of 
Hearing and Appeals (OHA) Peabody Western Coal Co. v. OSM, No. DV 2000-
1-PR (June 15, 2000) (Peabody Western), comments received on our 2005 
proposed rule, and our further discussions with our State co-
regulators.
    In Peabody Western, OHA examined the impact of NMA v. DOI II on 
transfer, assignment, or sale issues. OSM had determined that Peabody 
Western's change of all of its corporate officers and directors 
constituted a transfer, assignment, or sale of permit rights under 30 
CFR 701.5. The administrative law judge disagreed, explaining that, 
after NMA v. DOI II, OSM cannot presume that an officer or director is 
a controller and, therefore, a change of an officer or director, or 
even that a change of all officers and directors, cannot, standing 
alone, automatically constitute a change of ``effective control'' 
triggering a transfer, assignment, or sale of permit rights. The 
administrative law judge also made other observations that we assigned 
particular weight to in developing our 2005 proposed rule and today's 
proposal. The judge noted that the ``other effective control'' language 
is ``vague and imprecise'' and ``discloses no meaningful standard and 
provides no advance notice to a regulated corporate entity'' as to 
which corporate changes will constitute a transfer, assignment, or 
sale. This defect, according to the judge, does not provide ``adequate 
advance notice of the purported regulatory standard'' and leaves 
permittees ``to speculate'' as to when regulatory approval is required.
    Throughout our deliberations, we were mindful of OHA's admonition 
that our existing definition, to the extent it relies on the concept of 
``effective control,'' is ``vague and imprecise'' and ``discloses no 
meaningful standard and provides no advance notice to a regulated 
corporate entity'' as to which corporate changes will constitute a 
transfer, assignment, or sale. We concede that our definition has 
created confusion--among regulatory authorities, the regulated 
industry, and the public--that has led to various interpretations of 
the regulatory requirements. As in our 2005 proposed rule, we conclude 
that the imprecision in our current definition was created largely by 
our inclusion of the phrase ``or other effective control.'' Under 
SMCRA, the concept of control, in the context of permit eligibility, is 
found in section 510(c) of the Act. Under that section, an applicant is 
not eligible to receive a permit if it owns or controls an operation 
with an unabated or uncorrected violation. Our existing definition of 
transfer, assignment, or sale of permit rights imports the ownership 
and control concept from section 510(c), but nothing in the Act compels 
that approach. Because we believe that infusing transfer, assignment, 
or sale issues with the section 510(c) ownership and control concepts 
has created undue confusion as to what constitutes a transfer, 
assignment, or sale of permit rights, we propose to remove ownership 
and control concepts from the definition. As explained in more detail 
below, one of the results of this proposed revision is that a change of 
a permittee's owners or controllers would not constitute a transfer, 
assignment, or sale.
    In addition to responding to the decision in Peabody Western, we 
also believe that revising our definition of transfer, assignment, or 
sale of permit rights to mean a change of a permittee is consistent 
with the objective of section 511(b) of the Act. As explained above, 
section 511(b) requires regulatory approval for a transfer, assignment, 
or sale of permit rights. Those permit rights are held by the 
permittee. As long as the permit continues to be held by the same legal 
entity or ``person''--for example, a corporation or other business 
entity recognized under State law--we see no reason to apply the 
regulatory provisions governing transfer, assignment, or sale of permit 
rights. When the permittee changes--such as when the existing permittee 
sells its assets, including a mining permit or the rights granted under 
a permit, to a new permittee--there clearly has been a transfer, 
assignment, or sale of permit rights that would require regulatory 
approval. However, we propose that if the permittee's owners or 
controllers change, but the permittee remains the same, there has not 
been a transfer, assignment, or sale; in this instance, the existing 
permittee is the entity that will continue mining under the permit and 
will, as such, have to maintain appropriate bond coverage. Under this 
proposed definition, we would be looking for indicia that the existing 
permittee has actually conveyed its permit rights to a new permittee 
that desires to continue mining under the permit. We emphasize that 
while a permittee's change of an officer, director, shareholder, owner, 
controller, or certain other persons in its organizational structure 
would not trigger a transfer, assignment, or sale of permit rights 
under this proposal, the permittee would be required to report certain 
of these changes under proposed 30 CFR 774.12 (see heading S, below). 
Our proposed revision to the definition of transfer, assignment, or 
sale of permit rights at section 701.5 would reduce the reporting 
burden on both the coal mining industry and regulatory authorities due 
to the fact that fewer transactions or events would qualify as a 
transfer, assignment, or sale requiring an application and regulatory 
approval under 30 CFR 774.17. We invite your comments as to whether 
there are legal or practical reasons weighing in favor of or against 
our proposed revision.
    It also bears mention that we are not proposing to revise our 
definition of successor in interest, as we did in our 2005 proposed 
rule. Historically, we have viewed a successor in interest as ``any 
person who succeeds to rights granted under a permit, by transfer, 
assignment, or sale of those rights.'' See 30 CFR 701.5. In our 2005 
proposed rule, we proposed to give the term successor in interest 
independent meaning, apart from our definition of transfer, assignment, 
or sale of permit rights. However, based on comments received on the 
proposed rule, we have determined that there is no benefit in creating 
separate regulatory requirements and that our historic approach is 
preferable.

D. Section 773.3--Information Collection

    Current 30 CFR 773.3 contains a discussion of Paperwork Reduction 
Act requirements and the information collection aspects of 30 CFR part 
773. In keeping with the Office of Management and Budget's guidelines, 
we propose to revise current section 773.3 by streamlining the codified 
information collection discussion. A more detailed discussion of the 
information collection burdens associated with part 773 is

[[Page 59597]]

contained under the Procedural Determinations section (see heading 
V.10.), below.

E. Section 773.7--Review of Permit Applications

    We propose to revise current 30 CFR 773.7(a) in order to correct 
one cross-reference and to eliminate a cross-reference that is no 
longer relevant. In general, section 773.7(a) requires the regulatory 
authority to review certain information developed in connection with an 
application for a permit, revision, or renewal and to issue a written 
decision on the application. The second sentence of the current 
provision reads: ``If an informal conference is held under Sec.  
773.13(c), the decision shall be made within 60 days of the close of 
the conference, unless a later time is necessary to provide an 
opportunity for a hearing under paragraph (b)(2) of this section.'' In 
our 2000 final rule, we redesignated previous section 773.15(a)(1) as 
773.7(a), but made no other revisions to the provision at that time. 
Since the promulgation of our 2000 rule, it has come to our attention 
that the cross-references in that provision are either incorrect or no 
longer applicable.
    We propose to correct the first cross-reference so that it properly 
refers to current section 773.6(c). We also propose to remove the 
language that includes the second cross-reference because it is no 
longer relevant due to certain revisions we adopted in our 2000 final 
rule. More specifically, we propose to remove the qualifier phrase 
``unless a later time is necessary to provide an opportunity for a 
hearing under paragraph (b)(2) of this section'' because ``(b)(2)'' 
refers to a provision--previous 30 CFR 773.15(b)(2)--that no longer 
exists and because the logic behind the current provision is no longer 
applicable. The hearing contemplated by previous section 773.15(b)(2) 
was a hearing held in conjunction with an applicant's appeal of a 
notice of violation. Under today's proposal, if an applicant is 
pursuing a good faith appeal of a violation, and otherwise meets the 
criteria of proposed 30 CFR 773.14 (see heading J, below), the 
applicant will be eligible to receive a provisionally issued permit. 
Under these circumstances, we no longer see a need to delay the 
permitting decision in order to provide an opportunity for a hearing on 
a violation.

F. Section 773.8--General Provisions for Review of Permit Application 
Information and Entry of Information into AVS

    Among other things, current 30 CFR 773.8 requires a regulatory 
authority to enter certain permit application information into AVS. We 
propose to revise current 30 CFR 773.8 by removing the phrase 
``ownership and control'' from paragraph (b)(1). We propose this 
revision because we are also proposing to revise the heading of current 
30 CFR 778.11 by removing the phrase ``ownership and control.'' See 
discussion under heading V, below. Our rationale for these proposed 
revisions is that, under section 778.11, an applicant must submit 
information in addition to what could be called ``ownership and 
control'' information. At paragraph 773.8(b)(1), we are also proposing 
to add language clarifying that the information described (through a 
cross-reference to sections 778.11 and 778.12(c)) is required to be 
disclosed; disclosure of this information is not optional. The entire 
proposed provision at paragraph 773.8(b)(1) would read: ``The 
information you are required to submit under Sec. Sec.  778.11 and 
778.12(c) of this subchapter.''

G. Section 773.9--Review of Applicant and Operator Information

    Current 30 CFR 773.9 requires a regulatory authority to review 
certain information provided by the applicant during the regulatory 
authority's permit eligibility review. Similar to our proposed revision 
to section 773.8, we are proposing to revise the section heading at 
current 30 CFR 773.9 by removing references to ``ownership and 
control'' information. Thus, the revised section heading would read, 
``Review of applicant and operator information.'' We also propose to 
revise current section 773.9(a) by removing the phrase ``applicant, 
operator, and ownership or control.'' Again, these non-substantive 
proposed revisions merely clarify that the information that the 
applicant is required to disclose under section 778.11 is not limited 
to ownership and control information.
    As with the proposed revision to section 773.8, we also propose to 
revise section 773.9(a) by adding language that clarifies that the 
information described in the section (through a cross-reference to 
section 778.11) must be disclosed in a permit application; disclosure 
is not optional. Finally, we propose to revise section 773.9(a) by 
changing the term ``business structure'' to ``organizational 
structure.'' This proposed change is a broader description of the 
entities subject to the review.
    In sum, revised paragraph (a) would read: ``We, the regulatory 
authority, will rely upon the information that you, the applicant are 
required to submit under Sec.  778.11 of this subchapter, information 
from AVS, and any other available information, to review your and your 
operator's organizational structure and ownership and control 
relationships.''

H. Section 773.10--Review of Permit History

    We propose to revise current 30 CFR 773.10, which requires a 
regulatory authority to, among other things, review the permit history 
of an applicant and its operator during the regulatory authority's 
permit eligibility review. More specifically, we propose to revise 
section 773.10(b) by removing the reference to the applicant's 
``controllers disclosed under Sec. Sec.  778.11(c)(5) and 778.11(d) of 
this subchapter.'' Paragraph (b) would then read: ``We will also 
determine if you or your operator have previous mining experience.''
    In paragraph (c), we propose to remove the language ``your 
controllers, or your operator's controllers'' from the first sentence. 
In the second sentence of paragraph (c), we would remove ``and was not 
disclosed under Sec.  778.11(c)(5) of this subchapter.'' Paragraph (c) 
would then read: ``If you or your operator do not have any previous 
mining experience, we may conduct an additional review under Sec.  
774.11(f) of this subchapter. The purpose of this review will be to 
determine if someone else with mining experience controls the mining 
operation.'' We are proposing these revisions because we also propose 
to remove the requirement for an applicant to disclose its controllers 
(including its ``designated controller'') in a permit application. See 
discussion under heading V, below. These proposed revisions differ from 
the proposed revisions in our 2003 proposed rule in that we are 
proposing to remove all references to controllers. In our 2003 proposed 
rule, we proposed to substitute the references to all controllers with 
references to the designated controller an applicant is required to 
disclose under current 30 CFR 778.11(d). See 68 FR 75038. In light of 
today's proposal to remove section 778.11(d), cross-references to that 
section would no longer be necessary.

I. Section 773.12--Permit Eligibility Determination

    We propose to revise our provisions for permit eligibility 
determinations at current 30 CFR 773.12. As indicated above, under our 
discussion of the

[[Page 59598]]

definition of own, owner, or ownership (see heading B), current 30 CFR 
773.12(a) is the provision in our 2000 final rule that determines the 
``downstream'' reach of the rule in terms of permit eligibility. More 
specifically, we propose to revise paragraph (a)(2) so that we can no 
longer deny a permit based on indirect ownership of a surface coal 
mining operation with a violation; we would, however, retain the right 
to deny a permit based on indirect control. In order to simplify the 
rule, we also propose to merge paragraphs (a)(2) and (a)(3), without 
changing the substantive meaning of those provisions. The proposed 
revision to paragraph (a)(2), which would remove the reference to 
ownership, would provide that a permit applicant is not eligible for a 
permit if any surface coal mining operation that the applicant or the 
applicant's operator ``indirectly control[s] has an unabated or 
uncorrected violation and [the applicant's or operator's] control was 
established or the violation was cited after November 2, 1988.'' Thus, 
as explained above under heading B (definition of own, owner, or 
ownership), with respect to ownership, we could only look ``one level 
down'' from the applicant in making a permit eligibility determination. 
This proposed revision is carried forward from our 2003 proposed rule.
    We are also proposing to revise current 30 CFR 773.12(b). 
Consistent with the D.C. Circuit's ruling on retroactivity in NMA v. 
DOI II, 30 CFR 773.12(b) of our 2000 final rule provides that an 
applicant is eligible to receive a permit, notwithstanding the fact 
that the applicant or the applicant's operator indirectly owns or 
controls an operation with an unabated or uncorrected violation, if 
both the violation and the assumption of ownership or control occurred 
before November 2, 1988. However, 30 CFR 773.12(b) also provides that 
the applicant is not eligible to receive a permit under this provision 
if there ``was an established legal basis, independent of authority 
under section 510(c) of the Act, to deny the permit * * * .'' NMA 
challenged 30 CFR 773.12(b), claiming that if there is an ``independent 
authority'' to deny the permit, that authority exists whether or not it 
is referenced in the regulatory language. According to NMA, the 
provision is superfluous and potentially confusing. We agree that any 
``independent authority'' exists independent of this regulatory 
provision. Thus, in order to settle this claim, we propose to remove 30 
CFR 773.12(b). Because we propose to remove 30 CFR 773.12(b), we also 
propose to redesignate paragraphs (c), (d), and (e) as (b), (c), and 
(d), respectively. This proposed revision is carried forward from our 
2003 proposed rule.
    Finally, although we are not proposing any regulatory changes on 
this issue, we want to emphasize an inherent aspect of current section 
773.12: In meeting its obligations under section 510(c) of the Act and 
the State counterparts to that provision, each State, when it processes 
a permit application, must apply its own ownership and control rules to 
determine whether the applicant owns or controls any surface coal 
mining operations with violations. Consistent with the concept of State 
primacy, it is appropriate for the regulatory authority with 
jurisdiction over an application to apply its own ownership or control 
rules when making a permit eligibility determination, since that 
regulatory authority has the greatest interest in whether or not mining 
should commence or continue within its jurisdiction. However, when a 
regulatory authority is applying its ownership or control rules to 
violations in other jurisdictions, it is advisable for the regulatory 
authority to consult and coordinate, as necessary, with the regulatory 
authority with jurisdiction over the violation and our Applicant/
Violator System Office (AVS Office). We also stress that a regulatory 
authority processing a permit application has no authority to make 
determinations relating to the initial existence or current status of a 
violation, or a person's responsibility for a violation, in another 
jurisdiction.

J. Section 773.14--Eligibility for Provisionally Issued Permits

    Section 773.14 of our 2000 final rule allows for the issuance of a 
``provisionally issued permit'' if the applicant meets the criteria 
under 30 CFR 773.14(b). The promulgated regulatory language uses the 
word ``may,'' which indicates that the regulatory authority retains 
discretion to grant a provisionally issued permit, even if the 
applicant otherwise meets the eligibility criteria at 30 CFR 773.14(b). 
While the preamble discussion in our 2000 rule is not explicit on this 
point, we intended in this context that an applicant is eligible to 
receive a provisionally issued permit under the specified 
circumstances. See, e.g., 65 FR 79618-19, 79622-24, 79632, 79634-35, 
and 79638.
    In order to reconcile any ambiguity, today we propose to revise our 
rule language at 30 CFR 773.14(b) to clarify that an applicant who 
meets the 30 CFR 773.14(b) eligibility criteria will be eligible for a 
provisionally issued permit. We stress that an applicant must also meet 
all other permit application approval and issuance requirements before 
receiving a provisionally issued permit and that the provisional 
permittee must comply with all performance standards. See generally 65 
FR 79622. This proposed revision is carried forward from our 2003 
proposed rule.

K. Section 773.21--Initial Review and Finding Requirements for 
Improvidently Issued Permits

    Sections 773.21 through 773.23 of our rules are the provisions 
governing improvidently issued permits. In this context, these are 
permits we should not have issued in the first instance because of an 
applicant's ownership or control of a surface coal mining operation 
with an unabated or uncorrected violation at the time of permit 
issuance. We propose two substantive revisions to 30 CFR 773.21(c).
    The first revision concerns our burden of proof when making a 
preliminary finding that a permit was improvidently issued. In our 2003 
proposed rule, in accordance with our settlement with NMA, we proposed 
to revise section 773.21(c) so that our preliminary finding that a 
permit was improvidently issued ``must be based on reliable, credible, 
and substantial evidence and establish a prima facie case that [the 
permittee's] permit was improvidently issued.'' See 68 FR 75039. Based 
on input received from our State co-regulators--both in their comments 
on our 2003 proposed rule and in our outreach meeting--and other 
commenters, we have come to believe that requiring a prima facie case 
of improvident permit issuance to be based on ``reliable, credible, and 
substantial'' evidence is too high of a burden on a regulatory 
authority (particularly in the context of a preliminary finding). Thus, 
today we propose that our preliminary finding that a permit was 
improvidently issued ``must be based on evidence sufficient to 
establish a prima facie case that [the permittee's] permit was 
improvidently issued.'' This evidentiary standard, we believe, is more 
in line with traditional notions of what it takes to establish a prima 
facie case and is consonant with the standard that typically applies to 
OSM's regulatory findings. See headings O and R, below, for additional 
discussions on burden of proof issues.
    We also propose to remove current 30 CFR 773.21(c)(2), which 
requires us to post a notice of a preliminary finding of improvident 
permit issuance at our

[[Page 59599]]

office closest to the permit area and on the Internet. This proposed 
revision is carried forward from our 2003 proposed rule. We are also 
carrying forward our 2003 proposal to remove all other Internet posting 
requirements adopted in our 2000 final rule. In addition to 30 CFR 
773.21(c)(2), we propose to remove the Internet posting requirements 
found in current 30 CFR 773.22(d), 773.23(c)(2), and 773.28(d). We also 
propose to remove the requirement to post preliminary decisions ``at 
our office closest to the permit area.'' The requirements to post 
preliminary decisions that we propose to remove are found in current 30 
CFR 773.21(c)(2) and 773.22(d). (Current section 843.21 contains 
additional posting requirements that would be removed as part of our 
proposal to remove 843.21 in its entirety. See discussion under heading 
W, below.) We would retain the current requirement at 30 CFR 
773.23(c)(2) to post a notice of permit suspension or rescission at our 
office closest to the permit area. We also would retain the current 
requirement at 30 CFR 773.28(d) to post a final agency decision on a 
challenge of an ownership or control listing or finding on AVS.
    Our inclusion of the Internet posting requirements in the 2000 rule 
was primarily based on comments that we should expand the public's 
access to our decisions. See, e.g., 65 FR 79632. While public access to 
final decisions remains important, we have come to believe that the 
various Internet posting requirements in the 2000 final rule could be 
unduly burdensome to regulatory authorities, especially when public 
notice of final decisions can be accomplished by the less burdensome, 
conventional method of posting them at our office closest to the permit 
area. Further, regulatory authorities are already required to enter 
much of the relevant information into AVS, which is available to the 
public. Posting preliminary findings by any method could likewise 
become unduly burdensome; further, posting of preliminary findings is 
of questionable value to the public. For these reasons, we propose to 
remove all Internet and preliminary finding posting requirements, but 
retain public posting of our final decisions. In terms of information 
collection burdens on regulatory authorities, we note that we have not 
yet required the States to implement these posting requirements. Thus, 
because we propose to eliminate an information collection that never 
took effect for the States, there is no net change to the information 
collection burden.

L. Section 773.22--Notice Requirements for Improvidently Issued Permits

    As discussed above, we propose to remove 30 CFR 773.22(d), which 
contains posting requirements similar to those found at current 30 CFR 
773.21(c)(2), discussed above under heading K. Specifically, we propose 
to remove the requirement to post a notice of proposed suspension or 
rescission at our office closest to the permit area and on the 
Internet. Because we propose to remove paragraph (d), we further 
propose to redesignate current paragraphs (e) through (h) as paragraphs 
(d) through (g). In the proposed rule language that follows this 
discussion of the proposed rules, our proposed revision to 30 CFR 
773.22 is shown as a Federal Register instruction. This proposed 
revision is carried forward from our 2003 proposed rule.

M. Section 773.23--Suspension or Rescission Requirements for 
Improvidently Issued Permits

    We propose to revise the posting requirements contained in current 
30 CFR 773.23. Current 30 CFR 773.23(c)(2) requires us to post a final 
notice of permit suspension or rescission (which requires the holder of 
the improvidently issued permit to cease all surface coal mining 
operations on the permit) at our office closest to the permit area and 
on the Internet. We propose to remove the requirement to post final 
notices on the Internet. (Our rationale for removing this and similar 
posting requirements is discussed more fully above under heading K.) 
However, because section 773.23(c)(2) pertains to final findings (as 
opposed to the preliminary and proposed findings under sections 30 CFR 
773.21 and 773.22, respectively), we have decided to retain the 
requirement to post a final notice at our office closest to the permit 
area. We believe it is appropriate to post notices of such final 
actions for public view. These proposed revisions are carried forward 
from our 2003 proposed rule.

N. Section 773.26--How to Challenge an Ownership or Control Listing or 
Finding

    Sections 773.25 through 773.28 of our rules govern challenges to 
ownership or control listing or findings. Generally speaking, an 
ownership or control listing arises when an applicant identifies, or 
``lists,'' a person as an owner or controller in a permit application. 
That information is, in turn, entered into AVS by a regulatory 
authority. By contrast, an ownership or control finding under 30 CFR 
774.11(f) constitutes a regulatory authority's fact-specific 
determination that a person owns or controls a surface coal mining 
operation.
    In its judicial challenge to our 2000 final rule, NMA claimed that 
30 CFR 773.26(a) is confusing. That section explains how and where a 
person may challenge an ownership or control listing or finding. NMA 
claimed that the provision does not clearly delineate the appropriate 
forum in which to bring a challenge. NMA also expressed concern that 
the provision seems to refer only to applicants and permittees, but not 
other persons who are identified in AVS as owners or controllers.
    Section 773.25 of our 2000 final rule provides that any person 
listed in a permit application or in AVS as an owner or controller, or 
found by a regulatory authority to be an owner or controller, may 
challenge the listing or finding. As we explained in the preamble, our 
intent was, in fact, to allow any person listed in a permit application 
or in AVS, or found to be an owner or controller, to initiate a 
challenge at any time, regardless of whether there is a pending permit 
application or an issued permit. See 65 FR 79631. Section 773.26(a) was 
not intended to limit, in any way, the universe of persons who may 
avail themselves of the challenge procedures under 30 CFR 773.25; 
rather, it merely specifies the procedure and forum in which to 
challenge an ownership or control listing or finding.
    Nonetheless, in order to provide greater clarity to the provisions 
in 773.26(a), and in accordance with our settlement with NMA, we 
proposed (in our 2003 proposed rule) to revise our regulations at 30 
CFR 773.26(a) to more clearly specify the forum in which a person may 
initiate an ownership or control challenge. Today, we carry forward 
this aspect of our 2003 proposed rule. Specifically, we propose that 
challenges pertaining to a pending permit application must be submitted 
to the regulatory authority with jurisdiction over the pending 
application. We further propose that all other challenges concerning 
ownership or control of a surface coal mining operation must be 
submitted to the regulatory authority with jurisdiction over the 
relevant surface coal mining operation.
    We note that, in meeting its obligations under section 510(c) of 
the Act and the State counterparts to that provision, each State, when 
it decides an ownership or control challenge under its counterpart to 
30 CFR 773.28, must apply its own ownership and control rules to 
determine whether the applicant owns or controls (or owned or 
controlled) any surface coal mining

[[Page 59600]]

operations with violations. See generally 65 FR 79637. Further, we 
stress that an ownership or control decision by one State is not 
necessarily binding on any other State. This provision comports with 
principles of State primacy, and recognizes that not all States will 
have identical ownership and control rules.
    In our 2003 proposed rule, we also proposed to add new 30 CFR 
773.26(e), in accordance with our settlement with NMA. Today, we carry 
forward this aspect of our 2003 proposed rule. This new provision would 
allow a person who is unsure why he or she is shown in AVS as an owner 
or controller of a surface coal mining operation to request an informal 
explanation from our (AVS Office). The new provision would require us 
to respond to such a request within 14 days. Our response would be 
informal and would set forth in simple terms why the person is shown in 
AVS. In most, if not all, cases, the explanation would be as simple as 
specifying that the person was found to be an owner or controller under 
30 CFR 774.11(f) (of which the person should already be aware due to 
that section's written notice requirement) or was listed as an owner or 
controller in a permit application. Understanding the basis for being 
shown in AVS will give persons a better sense of the type of evidence 
they will need to introduce in an ownership or control challenge. See 
also 30 CFR 773.27(c), which provides examples of materials a person 
may submit in support of his or her ownership or control challenge.

O. Section 773.27--Burden of Proof for Ownership or Control Challenges

    As mentioned above, our rules contain provisions for challenging 
ownership or control listings or findings. Under current 30 CFR 
773.27(a), a successful challenger must prove by a preponderance of the 
evidence that he or she is not, or was not, an owner or controller. In 
its judicial challenge to our 2000 final rule, NMA argued that we must 
demonstrate at least a prima facie case so that the challenger can know 
what evidence he or she must rebut.
    The preamble to our 2000 final rule already made it clear that we 
had to establish a prima facie case when making a finding of ownership 
or control:

    [I]n making a finding [of ownership or control] under final 
Sec.  774.11(f), the regulatory authority must indeed make a prima 
facie determination of ownership and control, based on the evidence 
available to the regulatory authority. In making a prima facie 
determination, the finding should include evidence of facts which 
demonstrate that the person subject to the finding meets the 
definition of own, owner, or ownership or control or controller in 
Sec.  701.5.

65 FR 79640. Nonetheless, in order to settle NMA's claim and to set 
forth more clearly the relative burdens of the parties, we agreed to 
propose revisions to section 30 CFR 773.27(a) and 774.11(f), as well as 
a related revision to 30 CFR 773.21(c) (see discussion above under 
heading K). The proposed revisions were part of our 2003 proposed rule. 
Today, we are proposing revisions that deviate slightly from the 2003 
proposed revisions but retain the general substance of our prior 
proposals. As explained in more detail below under heading R, we are 
proposing to amend 30 CFR 774.11(f) in order to clarify that a 
regulatory authority's finding of ownership or control must be based on 
evidence sufficient to establish a prima facie case of ownership or 
control. We propose to amend section 773.27(a) so that it reads:

    (a) When you challenge a listing of ownership or control, or a 
finding of ownership or control made under Sec.  774.11(f) of this 
subchapter, you must prove by a preponderance of the evidence that 
you either--
    (1) Do not own or control the entire surface coal mining 
operation or relevant portion or aspect thereof; or
    (2) Did not own or control the entire surface coal mining 
operation or relevant portion or aspect thereof during the relevant 
time period.

Our proposed revision to paragraph (a) merely clarifies that a person 
can challenge either an ownership or control listing or a finding of 
ownership or control under 30 CFR 774.11(f). In our 2003 proposed rule, 
we proposed adding the term ``prima facie'' before the word ``finding'' 
in paragraph (a). However, we now believe the addition of that term is 
redundant given that our proposed revision to section 774.11(f) would 
clarify that our written findings of ownership or control must be based 
on evidence sufficient to establish a prima facie case. At paragraphs 
(a)(1) and (a)(2), we propose to clarify that the ``operation'' 
referred to in these provisions is a surface coal mining operation.
    Under the burden of proof allocation we propose today, as under our 
current rules, if the challenge concerns a finding of ownership or 
control, the regulatory authority will have borne the initial burden of 
establishing a prima facie case of ownership or control by issuing its 
finding in accordance with section 774.11(f). If the challenge concerns 
an ownership or control listing, the regulatory authority's initial 
burden is substantially lower: The regulatory authority must specify 
only the circumstances of the listing, such as who listed the person, 
the date of the listing, and in what capacity the person was listed. In 
either type of challenge, after the regulatory authority meets its 
initial burden, the burden shifts to the challenger to prove, by a 
preponderance of the evidence, that he or she does not, or did not, own 
or control the relevant surface coal mining operation. The challenger 
bears the ultimate burden of persuasion.

P. Section 773.28--Written Agency Decision on Challenges to Ownership 
or Control Listings or Findings

    We propose to revise the posting requirements of 30 CFR 773.28, our 
rules governing written agency decisions on challenges to ownership or 
control listings or findings. Current section 773.28(d) requires us to 
post final decisions on ownership or control challenges on AVS and on 
the AVS Office's Internet home page. We propose to remove the 
requirement to post these decisions on the Internet. However, because 
30 CFR 773.28 pertains to final decisions on ownership or control 
challenges, we have decided to retain the requirement to post these 
decisions on AVS. Because these final decisions may have permit 
eligibility consequences, it is appropriate to make such decisions 
publicly available by posting them on AVS. This proposed revision is 
carried forward from our 2003 proposed rule. Our rationale for removing 
this and similar posting requirements is set forth more fully above, 
under the discussion of 30 CFR 773.21 (see heading K).

Q. Section 774.9--Information Collection

    Current 30 CFR 774.9 contains a discussion of Paperwork Reduction 
Act requirements and the information collection aspects of 30 CFR part 
774. In keeping with the Office of Management and Budget's guidelines, 
we propose to revise current section 774.9 by streamlining the codified 
information collection discussion. A more detailed discussion of the 
information collection burdens associated with part 774 is contained 
under the Procedural Determinations section (see heading V.10.), below.

R. Section 774.11--Post-Permit Issuance Requirements for Regulatory 
Authorities and Other Actions Based on Ownership, Control, and 
Violation Information

    We propose several revisions to current 30 CFR 774.11 which, among 
other things, contains requirements for

[[Page 59601]]

regulatory authorities following the issuance of a permit. First, we 
propose to revise section 774.11(a)(3), which currently requires a 
regulatory authority to enter into AVS all ``[c]hanges of ownership or 
control within 30 days after receiving notice of a change.'' We propose 
to revise paragraph (a)(3) by removing ``Changes in ownership or 
control'' and replacing it with ``Changes to information initially 
required to be provided by an applicant under 30 CFR 778.11.'' We 
propose this revision because we are also proposing to revise the 
heading of current 30 CFR 778.11 by removing the phrase ``ownership and 
control.'' See discussion below, under heading V. Our rationale for 
these proposed revisions is that, under section 778.11, an applicant 
must submit information in addition to what could be called ``ownership 
and control'' information. This proposed revision is carried forward 
from our 2003 proposed rule.
    Second, we propose to revise 30 CFR 774.11(e). Under the specified 
circumstances, 30 CFR 774.11(c) of our rules requires us to make a 
preliminary finding of permanent permit ineligibility. Section 30 CFR 
774.11(d) provides for administrative review of a preliminary finding. 
Current 30 CFR 774.11(e) reads as follows: ``We must enter the results 
of the finding and any hearing into AVS.'' Confusion has arisen as to 
whether we must enter a preliminary finding into AVS, prior to 
administrative resolution.
    To settle a claim brought by NMA, we agreed to clarify that a 
finding of permanent permit ineligibility would be entered into AVS 
only if it is affirmed on administrative review or if the person 
subject to the finding does not seek administrative review and the time 
for seeking administrative review has expired. In order to incorporate 
this clarification into our regulatory requirements, we propose to 
revise 30 CFR 774.11(e). Specifically, at the beginning of paragraph 
(e), we propose to add the subheading ``Entry into AVS.'' We further 
propose to create new paragraph (e)(1), which would read: ``If you do 
not request a hearing, and the time for seeking a hearing has expired, 
we will enter our finding into AVS,'' and new paragraph (e)(2), which 
would read: ``If you request a hearing, we will enter our finding into 
AVS only if that finding is upheld on administrative appeal.'' With a 
minor, non-substantive modification, this proposed revision is carried 
forward from our 2003 proposed rule.
    Third, we propose to revise 30 CFR 774.11(f), which governs a 
regulatory authority's finding of ownership or control. As with the 
proposed revision of 30 CFR 773.27, discussed above under heading O, we 
propose to revise 30 CFR 774.11(f) to clarify that a regulatory 
authority's written finding of ownership or control must be based on 
evidence sufficient to establish a prima facie case. In the preamble to 
our 2000 final rule, we explained that a finding of ownership or 
control must be based on a prima facie determination of ownership or 
control (65 FR 79640); the revision we propose today makes this 
requirement explicit. In the context of a regulatory authority's 
finding of ownership or control, a prima facie case is one consisting 
of sufficient evidence to establish the elements of ownership or 
control and that would entitle the regulatory authority to prevail 
unless the evidence is overcome by other evidence.
    In our 2003 proposed rule, we proposed that a regulatory 
authority's prima facie finding under section 774.11(f) must be based 
on reliable, credible, and substantial evidence. However, as with 
section 773.21 (see heading K, above), based on input received from our 
State co-regulators and other commenters, we have come to believe that 
requiring a prima facie finding of ownership or control to be based on 
``reliable, credible, and substantial'' evidence is too high of a 
burden on a regulatory authority for an initial finding. Thus, we 
propose that our findings of ownership or control under section 774.11 
``must be based on evidence sufficient to establish a prima facie case 
of ownership or control.'' This evidentiary standard, we believe, is 
more in line with traditional notions of what it takes to establish a 
prima facie case and is consonant with the standard that typically 
applies to OSM's regulatory findings.
    For logistical reasons, we also propose to merge the substance of 
current paragraph (f)(1) into proposed paragraph (f); merge the 
substance of current paragraph (f)(2) into proposed paragraph (g) 
(discussed below); and remove current paragraph (f)(3), to be 
consistent with the revisions we propose to 30 CFR 778.11(c)(5) and (d) 
(discussed below under heading V). These proposed changes include 
removing the current requirement at paragraph (f)(3) that, following a 
finding of ownership or control, a person must disclose his or her 
identity under 30 CFR 778.11(c)(5) and, if appropriate, certify that 
they are a controller under 30 CFR 778.11(d). As discussed below under 
heading V, we propose to remove the information disclosure requirements 
at 778.11(c)(5) and (d). Therefore, the cross-references to those 
provisions in section 774 would no longer make sense.
    Fourth, we propose to revise 30 CFR 774.11 to address NMA's claim 
that our 2000 final rule denies a person the right to challenge a 
decision to ``link'' it by ownership or control to a violation before 
the ``link'' is entered into AVS. (See 30 CFR 701.5 for definition of 
Applicant/Violator System or AVS.) While we disagree with the 
characterization that we enter ``links'' to violations into AVS, today 
we propose to create a new paragraph (g). The new regulatory provision 
would specify that, after we issue a written finding of ownership or 
control under 30 CFR 774.11(f), and before we enter the finding into 
AVS, we will allow the person subject to the finding 30 days in which 
to submit any information tending to demonstrate a lack of ownership or 
control. After reviewing any information submitted, if we are persuaded 
that the person is not an owner or controller, we will serve the person 
with a written notice to that effect; if we still find the person to be 
an owner or controller or if the person does not submit any information 
within the 30-day period, we must enter our finding under paragraph (f) 
into AVS. The requirement to enter our decision into AVS is currently 
found in section 774.11(f)(2); we propose to move that requirement into 
proposed paragraph (g). The process envisioned in proposed paragraph 
(g) would be informal and non-adjudicatory. With a minor modification, 
this proposed revision is carried forward from our 2003 proposed rule.
    Fifth, we propose to add a new paragraph (h), which would specify 
that we do not need to make a finding of ownership or control under 
paragraph (f) before entering into AVS the information that permit 
applicants are required to disclose under sections 778.11(b) and (c). 
For example, if we find that an applicant failed to disclose an 
operator in a permit application, we can enter the identity of the 
operator into AVS without making a finding of ownership or control. 
This is so because an applicant is required to identify its operator 
under section 507(b)(1) of the Act. 30 U.S.C. 1257(b)(1); 30 CFR 
778.11(b)(3). However, proposed paragraph (h) would also make clear 
that the mere listing of a person in AVS pursuant to 30 CFR 778.11(b) 
or (c) does not create a presumption or constitute a determination that 
such person owns or controls a surface coal mining operation. Of 
course, some of the persons required to be disclosed under sections 30 
CFR 778.11(b) and (c) will, in fact, be owners or controllers, but that

[[Page 59602]]

is because they meet the definition of own, owner, or ownership or 
control or controller at 30 CFR 701.5, not because they are listed in 
AVS. This proposal is carried forward from our 2003 proposed rule.
    Finally, we propose to make non-substantive revisions to current 
paragraph (g) and redesignate that provision as paragraph (i). Proposed 
paragraph (i) would read: ``If we identify you as an owner or 
controller under paragraph (f) of this section, you may challenge the 
finding using the provisions of Sec. Sec.  773.25, 773.26, and 773.27 
of this subchapter.'' This proposed revision is carried forward from 
our 2003 proposed rule.

S. Section 774.12--Post-permit Issuance Information Requirements for 
Permittees

    We propose to revise 30 CFR 774.12, which sets forth information 
reporting requirements for permittees after the issuance of a permit. 
More specifically, at paragraph (c), we propose to remove the reference 
to 30 CFR 778.11(d) (as we are proposing to remove that provision) and 
to add new paragraph (3), which would require a permittee to provide 
written notification to the surety, bonding entity, guarantor, or other 
person that provides the bonding coverage currently in effect whenever 
there is an addition, departure, or change in any position of any 
person the permittee was required to identify under 30 CFR 778.11(c). 
Sureties have expressed to us that it is important to review bond 
coverage following such events. We agree and believe notifying the 
bonding entities of such events is important to ensure that appropriate 
bond coverage remains in place. In addition, proposed paragraph (c)(3) 
would provide that the regulatory authority with jurisdiction over the 
permit may require written verification of continued appropriate bond 
coverage following such additions, departures, or changes. Given that 
some of these changes can be quite significant, we believe it is 
reasonable for a regulatory authority to require proof that bond 
coverage will continue and has not been jeopardized by the changes. We 
invite your comments as to whether there are practical or legal reasons 
weighing in favor of or against these proposed new provisions.

T. Section 774.17--Transfer, Assignment, or Sale of Permit Rights

    In 2005, we proposed to revise our regulations governing the 
transfer, assignment, or sale of permit rights. Our proposal was 
expansive and constituted a significant departure from our existing 
regulations. As explained above under heading C, we have decided to 
scale back the scope of our proposal. Under today's proposal, the 
primary change to our transfer, assignment, or sale regulations would 
be our proposed revision to our definition of transfer, assignment, or 
sale of permit rights at 30 CFR 701.5. By contrast, we propose 
relatively minor revisions to our existing regulations at 30 CFR 
774.17, which contains our regulatory procedures governing the 
transfer, assignment, or sale of permit rights.
    Current 30 CFR 774.17(a) provides that ``[n]o transfer, assignment, 
or sale of rights granted by a permit shall be made without the prior 
written approval of the regulatory authority.'' Our requirement for 
``prior written approval'' of a transfer, assignment, or sale has been 
construed by some as an attempt to require regulatory authority 
approval of private business transactions. We want to make clear that 
we have no involvement in private business transactions. However, we 
also stress that, under this proposal, a person's acquisition of a 
permit or the rights granted under a permit does not mean that the 
purchaser has acquired the right to mine. We continue to believe that 
only the regulatory authority can validate permit rights upon a 
transfer, assignment, or sale and that, in validating such permit 
rights, the regulatory authority must determine that the entity that 
proposes to mine as a result of the private transaction is eligible to 
conduct surface coal mining operations under the Act and its 
implementing regulations and that the entity has obtained sufficient 
bond coverage. Only upon validation by the regulatory authority can it 
be said that the successor in interest has become the new permittee and 
has permit rights.
    However, we also recognize that requiring operations to cease while 
a permittee seeks regulatory approval of a transfer, assignment, or 
sale of permit rights could result in unnecessary disruptions to the 
nation's energy supply. Thus, we propose that operations on the permit 
may continue on a short-term basis, at the discretion of the regulatory 
authority, while the permittee seeks regulatory approval of a transfer, 
assignment, or sale, but only if the successor in interest can 
demonstrate to the satisfaction of the regulatory authority that 
sufficient bond coverage will remain in place. Prior to a decision on 
an application for a transfer, assignment, or sale, the regulatory 
authority retains all of its enforcement powers and should take 
immediate action if the successor in interest is not complying with the 
terms of the permit or any requirements of the Act or its implementing 
regulations. Revised paragraph (a) would read: ``(a) General. No 
transfer, assignment, or sale of rights granted by a permit shall be 
made without the prior written approval of the regulatory authority. At 
its discretion, the regulatory authority may allow a successor in 
interest to continue surface coal mining and reclamation operations 
under the permit during the pendency of an application for approval of 
a transfer, assignment, or sale of permit rights submitted under 
paragraph (b) of this section, provided that the successor in interest 
can demonstrate to the satisfaction of the regulatory authority that 
sufficient bond coverage will remain in place.'' We invite your 
comments as to whether there are practical or legal reasons weighing in 
favor of or against this proposed new provision.
    At paragraph (d)(1), we propose to revise the cross-references to 
our permit eligibility rules. While the reference to section 773.12 
remains correct, the reference to section 773.15 is no longer correct, 
due to revisions we adopted in our 2000 final rule. Thus, we propose to 
revise the paragraph so that it cross-references sections 773.12 and 
773.14.

U. Section 778.8--Information Collection

    Current 30 CFR 778.8 contains a discussion of Paperwork Reduction 
Act requirements and the information collection aspects of 30 CFR part 
778. In keeping with the Office of Management and Budget's guidelines, 
we propose to revise current section 778.8 by streamlining the codified 
information collection discussion. A more detailed discussion of the 
information collection burdens associated with part 778 is contained 
under the Procedural Determinations section (see heading V.10.), below.

V. Section 778.11--Providing Applicant and Operator Information

    We propose several revisions to current 30 CFR 778.11, which sets 
forth certain information disclosure requirements for permit 
applicants. First, in a proposal carried forward from our 2003 proposed 
rule, we propose to remove the term ``ownership and control'' from the 
heading of the section. Thus, the heading for 30 CFR 778.11 would be 
revised to read: ``Providing applicant and operator information.'' We 
are proposing this revision largely because, under section 778.11, an 
applicant must submit information in addition to what could be called 
``ownership and control'' information and because we are also proposing 
to

[[Page 59603]]

remove current 30 CFR 778.11(c)(5) and (d), which require an applicant 
to disclose all of its owners and controllers in a permit application, 
including its ``certified controller'' under paragraph (d). (See 
discussions above under heading A and below under this heading). As a 
result of these proposed changes, and the other proposed revisions 
discussed below, revised 30 CFR 778.11 would comport more closely with 
certain of the permit information requirements contained in section 
507(b) of the Act. 30 U.S.C. 1257(b). While some of the persons 
identified in revised 30 CFR 778.11 would in fact be owners or 
controllers under our regulatory definitions, the broad term 
``applicant and operator'' information more aptly describes the range 
of information an applicant would be required to disclose.
    Current 30 CFR 778.11(a)(1) requires an applicant to identify 
whether it and its operator are ``corporations, partnerships, sole 
proprietorships, or other business entities.'' As we did in our 2003 
proposed rule, we today propose to add ``associations'' to this list of 
business entities to conform the provision more closely to section 
507(b)(4) of the Act.
    We propose to remove current paragraph 778.11(b)(4), which requires 
an applicant to disclose the identity of the person(s) responsible for 
submitting the Federal Coal Reclamation Fee Report (Form OSM-1) and for 
remitting the fee to OSM. As a practical matter, this information may 
not be known at the time of the application, and therefore, 
characterizing it as an application requirement seems improper. 
Moreover, the requirements for submission of OSM-1 forms and 
reclamation fee payments are clearly provided for under Subchapter R of 
our rules; an overlapping requirement is not necessary. Finally, the 
current provision requires States to obtain this information even 
though mining operators pay the reclamation fee to OSM. We see no 
reason to impose an information collection burden on the States when 
they have no use for the information. By removing the provision, we 
would also reduce the information collection burden on permit 
applicants. This proposed revision was not contained in either our 2003 
or 2005 proposed rules.
    We propose to replace current paragraph (b)(4) with a new provision 
that would require an applicant to disclose the identity of each 
business entity in the applicant's and operator's organizational 
structure, up to and including the ultimate parent entity of the 
applicant and operator. This proposed provision is based on our 
discussions with our State co-regulators, who explained that it is 
important for a regulatory authority to obtain this information at the 
time of application, particularly if we remove the requirement for 
applicants to disclose all of their owners and controllers (see 
discussion under this heading, below). Under this proposal, an 
applicant would only have to identify the business entities in its and 
its operator's organizational structures and not, for example, the 
officers, directors, and shareholders of each of those entities. This 
proposed provision was not contained in our 2003 or 2005 proposed 
rules.
    We also propose to revise paragraph 778.11(c). A permit applicant 
must provide certain information for the persons listed in the 
provision. We propose to add ``partner'' and ``member'' to this list of 
persons and to reorder the list. We propose to add ``partner'' because 
that term is used in section 507(b)(4) of the Act and because 
partnerships are common business entities in the coal mining industry. 
Likewise, limited liability companies, comprised of ``members,'' have 
become prevalent in the industry. Thus, we propose to include the term 
``member'' to ensure that we obtain the necessary information for 
members of a limited liability company. We also propose to redesignate 
current 30 CFR 778.11(c)(4) as 30 CFR 778.11(c)(6) and revise it to 
read: ``Person who owns, of record, 10 percent or more of the applicant 
or operator.'' This proposed change comports with section 507(b)(4) of 
the Act.
    As we explain under heading A, above, in conjunction with revising 
the definition of control or controller, we propose to remove the 
requirement at current 30 CFR 778.11(c)(5), which requires an applicant 
to identify all of its owners or controllers in a permit application 
(though we would still obtain ownership information under proposed 
paragraph (c)(6) and some of the persons a permit applicant identifies 
under section 778.11 would likely, in fact, be controllers under our 
regulatory definition). We propose this revision because we believe it 
is important to establish ``bright line,'' objective permit information 
requirements. As explained above, we propose to retain a definition of 
control that vests regulatory authorities with discretion to make fact-
specific findings of control on a case-by-case basis; we have concluded 
that it is difficult to impose an objective reporting requirement based 
on that type of definition. Even though we propose to remove this 
reporting requirement, we are confident that the disclosure 
requirements at sections 507(b) and 510(c) of the Act, as implemented 
in our regulations at 30 CFR 778.11, 778.12, and 778.14, will give 
regulatory authorities information sufficient to enforce the ownership 
and control provisions of section 510(c), as well as other provisions 
of the Act.
    Finally, we propose to remove current 30 CFR 778.11(d), which was 
part of NMA's challenge to our 2000 final rule. This section provides 
that ``[t]he natural person with the greatest level of effective 
control over the entire proposed surface coal mining operation must 
submit a certification, under oath, that he or she controls the 
proposed surface coal mining operation.'' NMA challenged the provision 
on procedural and substantive grounds, claiming, among other things, 
that it is vague and raises self-incrimination concerns. In order to 
settle this claim, we agreed to propose a revision to clarify the 
applicability and scope of the provision, which we did in our 2003 
proposed rule. However, after receiving input from our State co-
regulators, we propose to remove this provision from our regulations. 
Our sense is that this concept is ultimately unworkable given that an 
applicant may not know the identity of this person at the time of 
application and the identity of the person may change over time. As a 
result of this proposed revision, we also propose to redesignate 
current paragraph 778.11(e) as 778.11(d).
    Although we are proposing a new information collection at proposed 
paragraph (b)(4), the revisions we propose at 30 CFR 778.11 would 
result in a net reduction in the information disclosure requirements 
for applicants and in the information collection requirements for us 
and State regulatory authorities.

W. Section 843.21--Procedures for Improvidently Issued State Permits

    We propose to remove 30 CFR 843.21 in its entirety. Section 843.21 
sets forth Federal procedures relative to State-issued permits that may 
have been improvidently issued based on certain ownership or control 
relationships. This section provides for direct Federal inspection and 
enforcement, including our authority to issue notices of violation and 
cessation orders, if, after an initial notice, a State fails to take 
appropriate action or show good cause for not taking action with 
respect to an improvidently issued State permit. We have decided to 
propose its removal for the two reasons discussed in more detail below. 
Further, its removal will provide greater regulatory stability through

[[Page 59604]]

clarification of the State/Federal relationship related to permitting 
in primacy States, which has been a source of great confusion for many 
years. See, e.g., Coteau Prop. Co. v. Dep't of the Interior, 53 F.3d 
1466, 1472 (8th Cir. 1995) (``there exists a state of general confusion 
regarding SMCRA's allocation of power between OSM and primacy 
states'').
    First, we are proposing to remove section 843.21 because it is no 
longer needed. We first adopted regulations concerning improvidently 
issued permits on April 28, 1989 (54 FR 18438). (A discussion of the 
subsequent regulatory history and related litigation leading up to the 
present is found above under ``Background to the Proposed Rule.'') In 
our 2003 proposal (68 FR 75036), we proposed to eliminate the various 
provisions of 30 CFR 843.21 that required posting of notices and 
findings on the Internet. In addition, pursuant to our settlement with 
NMA, we proposed to clarify the basis for a notice under 30 CFR 
843.21(a).
    Since we issued our 2003 proposal, we have reviewed our historic 
use of this section. Since 1989, when this rule was first promulgated, 
we have found no record of OSM taking enforcement action under its 
provisions against a permittee holding a State-issued permit. From 1989 
through 1995, we issued fewer than 50 initial notices of improvidently 
issued permits to State regulatory authorities. In those cases, the 
issue that gave rise to the initial notice was resolved prior to the 
point at which OSM would have taken direct enforcement action against 
the permittee holding the State-issued permit. Since 1996, we have not 
even issued an initial notice for an improvidently issued permit to any 
State regulatory authority. The fact that we have not had a need to use 
the provisions of section 843.21 at all in at least a decade 
demonstrates that State regulatory authorities are making proper permit 
eligibility determinations pursuant to section 510 of the Act, 30 
U.S.C. 1260, and their State-program counterparts and, in the rare case 
of improvident permit issuance, properly applying State counterparts to 
our improvidently issued permit regulations. (Under our improvidently 
issued permit regulations--currently found at 30 CFR 773.21 through 
773.23--and the State counterparts to those regulations, a regulatory 
authority can initiate procedures to suspend or rescind permits it has 
improvidently issued due to certain ownership or control 
relationships.)
    Further, most, if not all, of the initial notices OSM did issue 
under section 843.21 prior to 1996 would not have been valid under the 
D.C. Circuit's subsequent decisions in NMA v. DOI I and NMA v. DOI II, 
which limited the scope of our rules implementing section 510(c) of the 
Act. (The NMA v. DOI decisions are discussed in greater detail above 
under ``Background to the Proposed Rule'' and at 65 FR 79582-84.) 
Consequently, we believe there is no longer a need for the provisions 
of 30 CFR 843.21 authorizing OSM to take direct enforcement action 
against an operation with a State-issued permit that may have been 
improvidently issued.
    The second reason for proposing the removal of section 843.21 is 
that a recent event has caused us to examine further our oversight role 
relative to State permitting decisions. On October 21, 2005, the 
Department of the Interior's Assistant Secretary for Land and Minerals 
Management (ASLMM) issued a final decision concerning a citizen group's 
request that OSM conduct a Federal inspection in a case where the 
citizen's group was dissatisfied with a State regulatory authority's 
decision to issue a coal mining permit. (A copy of the ASLMM's October 
21, 2005, final decision is contained in the administrative record for 
this rulemaking.) The citizen's group requested an inspection even 
though mining on the permit had not yet commenced and the citizen's 
group failed to prosecute a direct appeal of the State's permitting 
decision in State tribunals.
    In her decision, the ASLMM pointed out that ``OSM intervention at 
any stage of the state permit review and appeal process would in effect 
terminate the state's exclusive jurisdiction over the matter and [would 
frustrate SMCRA's] careful and deliberate statutory design.'' See also 
Bragg v. Robertson, 248 F. 3d 275, 288-289, 293-295 (4th Cir. 2001) 
(regulation under SMCRA is ``mutually exclusive, either Federal or 
State law regulates coal mining activity in a State, but not both 
simultaneously''; primacy States have ``exclusive jurisdiction'' over 
surface coal mining operations on nonfederal lands within their 
borders). The final decision also explained that in a ``primacy state, 
permit decisions and any appeals are solely matters of the state 
jurisdiction in which OSM plays no role.'' In support of this 
statement, the final decision cited the following passage from In re: 
Permanent Surface Mining Regulation Litig., 653 F.2d 514 (DC Cir. 1981) 
(PSMRL):

    In an approved and properly enforced state program, the state 
has the primary responsibility for achieving the purposes of the 
Act. First, the State is the sole issuer of permits. In performing 
this centrally important duty, the state regulatory authority 
decides who will mine in what areas, how long they may conduct 
mining operations, and under what conditions the operations will 
take place. See Act Sec. Sec.  506, 510. It decides whether a 
permittee's techniques for avoiding environmental degradation are 
sufficient and whether the proposed reclamation plan is acceptable. 
Act Sec.  510(b).
* * * * *
    Administrative and judicial appeals of permit decisions are 
matters of state jurisdiction in which the Secretary [of the 
Interior] plays no role. Act Sec.  514.

Id. at 519 (emphasis added).
    The ASLMM's decision has caused us to look more carefully at the 
statutory and regulatory scheme governing our oversight role related to 
State permitting decisions and, in particular, the propriety of 
retaining section 843.21. Inasmuch as current section 843.21 authorizes 
direct Federal enforcement against State permittees based on State 
permitting decisions, it is inconsistent with the ASLMM's decision, and 
arguably inconsistent with PSMRL's admonition that a primacy State is 
the ``sole issuer of permits'' within the State.
    Further, under SMCRA, State permitting is entirely separate from 
Federal inspections and associated Federal enforcement. The statutory 
provisions related to permit application review and permit decisions 
are found at section 510 of the Act, 30 U.S.C. 1260, and appeals of 
permitting decisions are provided for under section 514 of the Act, 30 
U.S.C. 1264. Nothing in these statutory provisions discusses 
inspections--the predicate to Federal enforcement under section 521 of 
the Act (30 U.S.C. 1271)--in connection with State permitting 
decisions, and certainly nothing in these provisions mandates Federal 
intervention in State permitting decisions.
    The Act's provisions for Federal inspections expressly provide that 
such inspections are of mining ``operations.'' See SMCRA section 
517(a), 30 U.S.C. 1267(a) (referring to inspections of surface coal 
mining and reclamation operations) and SMCRA section 521(a) (referring 
to inspections of surface coal mining operations). The definitions of 
surface coal mining and reclamation operations and surface coal mining 
operations at SMCRA sections 701(27) and (28), 30 U.S.C. 1291(27) and 
(28), do not mention anything about permits or permitting decisions. 
Instead, those definitions refer to activities and the areas upon which 
those activities occur. In short, the purpose of a Federal inspection 
is to determine what is happening at the mine, and, thus,

[[Page 59605]]

SMCRA's inspection and enforcement provisions do not readily apply to 
State permitting decisions because they are not activities occurring at 
the mine. See, e.g., Coteau, 53 F.3d at 1473 (``Permitting requirements 
such as revelation of ownership and control links are not likely to be 
verified through the statutorily-prescribed method of physical Federal 
inspection of the mining operation * * *''). In sum, we believe that 
Congress provided for inspection and enforcement for activities 
occurring at the mine, and purposely excluded permitting activities 
from the operation-specific inspection and enforcement process. 
Instead, the Secretary of the Interior's ``ultimate power over lax 
state enforcement is set out in section 521(b) of the Act [30 U.S.C. 
1271(b)].'' PSMRL, 653 F.2d at 519. The Secretary's power under section 
521(b) includes taking over an entire State permit-issuing process. Id.
    We recognize that in the preamble to our December 19, 2000, final 
rule--in which we, among other things, repromulgated section 843.21--we 
stated that, in NMA v. DOI II, the U.S. Court of Appeals for the DC 
Circuit upheld our ability to take remedial action relative to 
improvidently issued State permits. 65 FR 79653. We still believe that 
that is one possible reading of the decision; however, after further 
review, we believe the better interpretation is that NMA v. DOI II, 
when taken together with the same court's decision in PSMRL, the 
ASLMM's final decision, and the statutory framework discussed above, 
does not support retention of section 843.21.
    In NMA v. DOI II, the DC Circuit addressed, among other things, 
NMA's assertion that our 1997 version of section 843.21 (see 62 FR 
19450) impinged on State primacy. The DC Circuit agreed with NMA and 
invalidated our improvidently issued State permit regulations. 177 F.3d 
at 9. In invalidating section 843.21, the court noted that section 521 
of the Act ``sets out specific procedural requirements to be met before 
the Secretary may take remedial action against a state permittee.'' Id. 
Ultimately, the court concluded that our 1997 version of section 843.21 
was invalid because it did not comply with the procedural requirements 
of section 521(a)(3) of the Act. Id. In our 2000 preamble, we 
interpreted the NMA v. DOI II decision as holding that our ability to 
take enforcement action against improvidently issued State permits is 
authorized by section 521 of the Act, as long as we adhere to the 
specific procedures set forth in that section. Thus, in our 2000 final 
rule, we attempted to cure the perceived defect in the 1997 version of 
section 843.21 by repromulgating it in accordance with the procedures 
set forth in section 521 of the Act. 65 FR 79652. NMA timely challenged 
our 2000 rule, including section 843.21, but we ultimately settled that 
litigation by agreeing to propose new rules.
    As mentioned above, we reassessed the viability of section 843.21, 
including our analysis of the NMA v. DOI II decision, in light of the 
ASLMM's final decision. Upon reexamination, another possible reading of 
NMA v. DOI II, as it relates to our 1997 version of section 843.21, is 
that the court identified section 521(a)(3) of the Act as the only 
procedures under which we can take enforcement action against a State 
permittee, but did not expressly hold that our improvidently issued 
State permits regulations could, if amended, fall within the contours 
of section 521(a)(3). For a number of reasons, we now believe this is 
the better reading of NMA v. DOI II.
    For example, we have already discussed the fact that a Federal 
inspection of mining operations is a predicate to Federal enforcement 
under section 521(a) and that there is a mismatch between these types 
of inspections and alleged permitting defects. Further, the ASLMM's 
decision and SMCRA's statutory scheme suggest that there is no Federal 
role in State permitting decisions. Finally, up until our 2000 final 
rule, our provisions related to Federal enforcement against State 
permittees resulting from the inspections identified in section 521(a) 
were contained in 30 CFR 843.12, and it is clear from the regulatory 
history that we have historically intended sections 843.11 and 843.12 
to be the only regulatory provisions for Federal enforcement actions 
against State permittees based on the inspections identified in section 
521(a) of the Act. When we repromulgated section 843.21, we 
unintentionally created overlapping provisions implementing section 
521(a) of the Act. Removing section 843.21 would remove any confusion 
or uncertainty created by these unintentionally overlapping provisions.
    Based on the preceding discussion, we have reexamined the need and 
statutory basis for current section 843.21. While we recognize that 
there may be legal arguments in support of retaining the rule, we have 
determined that its removal would be more consistent with the ASLMM's 
decision discussed above and the framework of SMCRA. As such, we 
propose to delete 30 CFR 843.21.

X. Sections 847.11 and 847.16--Criminal Penalties and Civil Actions for 
Relief

    During the course of litigation over our 2000 final rule, NMA 
claimed that certain of the rule's ``alternative enforcement'' 
provisions unlawfully abrogate State prosecutorial discretion by making 
it mandatory for States to seek criminal penalties or institute civil 
actions for relief when certain specified conditions occur. See 
sections 30 CFR 847.11 (criminal penalties), 847.16 (civil actions for 
relief), and 847.2(c) (requiring State regulatory programs to include 
criminal penalty and civil action provisions that are no less stringent 
than the Federal requirements). Upon further reflection, we agreed that 
the regulatory authority--Federal or State--should retain the 
discretion to evaluate the severity of a violation and ultimately to 
determine whether referral for alternative enforcement is warranted. As 
such, and in order to settle NMA's claim, we proposed in 2003 to revise 
our regulations at 30 CFR 847.11 and 847.16 to remove the mandatory 
nature of referrals for alternative enforcement. In today's proposed 
rule, we carried forward this aspect of our 2003 proposed rule. 
Specifically, we propose to change the word ``will'' to ``may'' in the 
operative provisions to underscore that a regulatory authority ``may,'' 
but is not obligated to, refer a particular matter for alternative 
enforcement.

III. Clarifications to the Preamble to Our 2000 Ownership and Control 
Final Rule

    As explained above, as part of our settlement with NMA, we agreed 
to publish certain clarifications to the preamble supporting our 2000 
final rule. Like the corresponding preamble provisions in our 2000 
final rule, the clarifications we announce today do not impose 
regulatory requirements. As such, we are not seeking public comments on 
these issues, and we do not expect to address these topics again in any 
final rule.
    1. In NMA v. DOI I, the court of appeals explained that, as a 
general rule, we may not deny a permit based on violations of persons 
who own or control the applicant (so-called ``upstream'' owners and 
controllers). However, the court explained: ``OSM has leeway in 
determining who the applicant is. As [NMA] concedes, OSM has the 
authority, in instances where there is subterfuge, to pierce the 
corporate veil in order to identify the real applicant.'' NMA v. DOI I, 
105 F.3d at 695. Thus, the court held, ``once OSM

[[Page 59606]]

has determined that it has the true applicant before it, OSM's power is 
constrained by the specific statutory language of section 510(c)--only 
those violations of operations owned or controlled by the applicant are 
relevant.'' Id.
    At 65 FR 79609 through 79611 of the preamble of our 2000 final 
ownership and control rule, there is substantial discussion of the 
``true applicant'' concept and a related discussion of corporate veil-
piercing. In that portion of the 2000 final rule's preamble, our intent 
was to explain why we chose not to define the term ``true applicant,'' 
as well as to identify a non-exclusive list of theories that may be 
available to a regulatory authority in attempting to ascertain the 
identity of the true applicant. This general preamble language was not 
intended to impose any regulatory requirement on regulatory 
authorities.
    Nonetheless, confusion has arisen as to whether we are directing 
State regulatory authorities, via preamble language, to use any of the 
identified theories to identify the true applicant. To settle a claim 
brought by NMA in its judicial challenge to our 2000 final rule, we 
today clarify that we are not directing State regulatory authorities to 
use any of the three identified tools, or any other particular means, 
in ascertaining whether the nominal permit applicant is also the true 
applicant. Should a State attempt to pierce a corporate veil or 
otherwise ascertain the identity of the true applicant, it is for the 
State to decide which legal authorities it can and will advance. 
Ultimately, however, each permitting authority--whether State or 
Federal--must be satisfied that it indeed has the ``true applicant 
before it.'' NMA v. DOI I, 105 F.3d at 695. As we stated in the 
preamble of the 2000 final rule:

    In most cases, the nominal applicant (the person whose name 
appears on the permit application) will also be the true applicant. 
* * * However, if the regulatory authority has reason to believe 
that the nominal applicant is not the true applicant, the regulatory 
[authority] should conduct an investigation to determine the 
identity of the true applicant. In short, each regulatory authority 
should consider the totality of circumstances in determining whether 
the nominal applicant is also the true applicant.

65 FR 79610-11.
    2. Section 773.12 of our 2000 final rule requires regulatory 
authorities to determine whether permit applicants are eligible to 
receive a permit under section 510(c) of SMCRA, based on certain 
ownership or control relationships. At 65 FR 79616, in response to 
public comments, we explained that permit revisions and renewals are 
not necessarily exempt from the requirements of section 510(c) of 
SMCRA. Specifically, we stated that regulatory authorities may evaluate 
all permitting actions, including revisions and renewals, for 
eligibility under section 510(c). Confusion has arisen as to whether we 
are directing States to conduct a section 510(c) permit eligibility 
review for permit revisions and renewals.
    To settle a claim brought by NMA, today we clarify that we do not 
require States to conduct such a review for permit renewals and 
revisions other than transfers, assignments, or sales of permit rights 
under 30 CFR 774.17. However, in our view, States retain the discretion 
to require section 510(c) reviews for any revision or renewal. 
Nonetheless, we do not believe a section 510(c) review is necessarily 
warranted when a regulatory authority orders a revision under 30 CFR 
774.10. In that circumstance, we believe that it would make little 
sense to conduct a section 510(c) review if such a review would 
preclude the permittee from correcting the problem that resulted in 
issuance of the revision order. Other than the clarification we 
announce today, the 2000 final rule's preamble discussion on this 
topic, including the legal rationale supporting our position, remains 
in force.

IV. Public Comment Procedures

    Electronic or Written comments: If you submit written comments, 
they should be specific, confined to issues pertinent to this proposed 
rule, and explain the reason for any recommended change(s). We 
appreciate any and all comments, but the most useful and likely to 
influence decisions on a final rule will be those that either involve 
personal experience or include citations to and analyses of SMCRA, its 
legislative history, its implementing regulations, case law, other 
pertinent State or Federal laws or regulations, technical literature, 
or other relevant publications. Please note that, in the context of 
this proposed rule, we will not consider any comments received on our 
2003 and 2005 proposals. 68 FR 75036; 70 FR 3840. To the extent your 
previous comments are applicable to this proposed rule, we request that 
you resubmit them if you want us to consider them in the context of 
this proposed rule.
    Except for comments provided in an electronic format, you should 
submit three copies of your comments if practical. We will make every 
attempt to log all comments into the administrative record for this 
rulemaking, but comments received after the close of the comment period 
(see DATES) or at locations other than those listed above (see 
ADDRESSES) may not be included in the administrative record or 
considered when we develop any final rule.
    Availability of Comments: Our practice is to make comments, 
including names and home addresses of respondents, available for public 
review during regular business hours at the OSM Administrative Record 
Room (see ADDRESSES). Individual respondents may request that we 
withhold their home address from the rulemaking record. We will honor 
this request to the extent allowable by law. There also may be 
circumstances in which we would withhold from the rulemaking record a 
respondent's identity, to the extent allowed by law. If you wish us to 
withhold your name and/or address, you must state this prominently at 
the beginning of your comment, state the basis for your request, and 
submit your comment by regular mail, not electronically. We will make 
all submissions from organizations or businesses, and from individuals 
identifying themselves as representatives or officials of organizations 
or businesses, available for public inspection in their entirety.
    Public hearings: We will hold a public hearing on the proposed rule 
upon request only. The time, date, and address for any hearing will be 
announced in the Federal Register at least 7 days prior to the hearing.
    Any person interested in participating in a hearing should inform 
Mr. Earl Bandy (see FOR FURTHER INFORMATION CONTACT), either orally or 
in writing by 4:30 p.m., Eastern time, on October 31, 2006. If no one 
has contacted Mr. Bandy to express an interest in participating in a 
hearing by that date, a hearing will not be held. If only one person 
expresses an interest, a public meeting rather than a hearing may be 
held, with the results included in the administrative record for this 
rulemaking.
    The public hearing will continue on the specified date until all 
persons scheduled to speak have been heard. If you are in the audience 
and have not been scheduled to speak and wish to do so, you will be 
allowed to speak after those who have been scheduled. We will end the 
hearing after all persons scheduled to speak and persons present in the 
audience who wish to speak have been heard. To assist the transcriber 
and ensure an accurate record, we request, if possible, that each 
person who speaks at a public hearing provide us with a written copy of 
his or her testimony.
    Public meeting: If there is only limited interest in a hearing at a 
particular

[[Page 59607]]

location, a public meeting, rather than a public hearing, may be held. 
Persons wishing to meet with us to discuss the proposed rule may 
request a meeting by contacting the person listed under FOR FURTHER 
INFORMATION CONTACT. All meetings will be open to the public and, if 
possible, notice of the meetings will be posted at the appropriate 
locations listed under ADDRESSES. A written summary of each public 
meeting will be made a part of the administrative record for this 
rulemaking.

V. Procedural Determinations

1. Executive Order 12866--Regulatory Planning and Review

    This proposed rule is not considered a significant regulatory 
action under the criteria of Executive Order 12866.
    a. The proposed rule will not have an effect of $100 million or 
more on the economy. It will not adversely affect in a material way the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local, or Tribal governments or 
communities. The proposed revisions to the regulations will not have an 
adverse economic impact on the coal industry or State regulatory 
authorities.
    The proposed revisions would result in a reduction in expenses for 
the coal industry and State regulatory authorities because of proposed 
programmatic changes to the regulations that would reduce the reporting 
burden for certain types of applicants and transactions. Expenses would 
be reduced primarily due to the fact that, as a result of our proposed 
revision to the definition of transfer, assignment, or sale of permit 
rights at 30 CFR 701.5, fewer transactions or events would qualify as a 
transfer, assignment, or sale requiring an application and regulatory 
approval under 30 CFR 774.17. In addition, permit applicants would no 
longer have to identify all of their controllers in a permit 
application under 30 CFR 778.11(c), and State regulatory authorities 
would no longer have to enter that information into AVS under 30 CFR 
773.8(b)(1).
    The programmatic changes to the regulations are estimated to result 
in a savings to the coal industry of approximately $251,000 per year, 
and a savings to the State and Federal regulatory authorities of 
approximately $127,000 per year. Paragraph 10, below, contains tables 
indicating the changes in the information collection burdens for Parts 
773, 774, and 778. The tables for Parts 774 and 778 indicate an 
increase in total annual burden hours. However, the net increase for 
those parts is due to an increase in the number of respondents and not 
to a net increase in the per respondent burden hours. None of the 
changes in the proposed rule would significantly alter the fundamental 
conceptual framework of our regulatory program.
    b. This proposed rulemaking would not create a serious 
inconsistency or otherwise interfere with an action taken or planned by 
another agency.
    c. This proposed rulemaking would not alter the budgetary effects 
of entitlements, grants, user fees, loan programs, or the rights and 
obligations of their recipients.
    d. This proposed rulemaking does not raise novel legal or policy 
issues.

2. Regulatory Flexibility Act

    The Department of the Interior certifies that this proposed rule 
will not have a significant economic impact on a substantial number of 
small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et 
seq.). As previously stated, the proposed revisions to the regulations 
would likely reduce the cost of doing business for the regulated 
industry and State regulatory authorities and, therefore, would not 
have an adverse economic impact on the coal industry or State 
regulatory authorities. In addition, the proposed rulemaking would 
produce no adverse effects on competition, employment, investment, 
productivity, innovation, or the ability of United States enterprises 
to compete with foreign-based enterprises in domestic or export 
markets.

3. Small Business Regulatory Enforcement Fairness Act

    For the reasons previously stated, this proposed rule is not a 
major rule under 5 U.S.C. 804(2), the Small Business Regulatory 
Enforcement Fairness Act. This proposed rule:
    a. Does not have an annual effect on the economy of $100 million or 
more.
    b. Will not cause major increases in costs or prices for consumers, 
individual industries, Federal, State, or local government agencies, or 
geographic regions.
    c. Does not have significant adverse effects on competition, 
employment, investment, productivity, innovation, or the ability of 
United States-based enterprises to compete with foreign-based 
enterprises.

4. Unfunded Mandates Reform Act of 1995

    For the reasons previously stated, this proposed rule would not 
impose an unfunded mandate on State, local, or Tribal governments or 
the private sector of more than $100 million per year. The proposed 
rule does not have a significant or unique effect on State, local, or 
Tribal governments or the private sector. A statement concerning 
information required under the Unfunded Mandates Reform Act (2 U.S.C. 
1531) is not required.

5. Executive Order 12630--Takings

    We have determined that this proposed rulemaking does not have any 
significant takings implications under Executive Order 12630. 
Therefore, a takings implication assessment is not required.

6. Executive Order 12988--Civil Justice Reform

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

7. Executive Order 13132--Federalism

    For the reasons discussed above, this proposed rule does not have 
significant Federalism implications that warrant the preparation of a 
Federalism Assessment under Executive Order 13132.

8. Executive Order 13175--Consultation and Coordination With Indian 
Tribal Governments

    In accordance with Executive Order 13175, we have evaluated the 
potential effects of this proposed rule on Federally-recognized Indian 
tribes. We have determined that the proposed rule would not have 
substantial direct effects on the relationship between the Federal 
Government and Indian tribes or on the distribution of power and 
responsibilities between the Federal Government and Indian Tribes.

9. Executive Order 13211--Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use

    This proposed rule is not considered a significant energy action 
under Executive Order 13211. For the reasons previously stated, the 
proposed revisions to the regulations implementing SMCRA would not have 
a significant effect on the supply, distribution, or use of energy.

10. Paperwork Reduction Act

    The proposed rulemaking requires information collection under the 
Paperwork Reduction Act. In accordance with 44 U.S.C. 3507(d), we have 
submitted the information collection and record keeping requirements 
for 30 CFR Parts 773, 774, and 778 to the Office of Management

[[Page 59608]]

and Budget (OMB) for review and approval.
30 CFR Part 773
    Title: Requirements for Permits and Permit Processing.
    OMB Control Number: 1029-0115.
    Summary: Sections 507 and 510 of SMCRA set forth requirements 
pertaining to, among other things, information required from permit 
applicants, permit eligibility, and permit denial. Among other things, 
regulatory authorities use the information obtained from applicants in 
making permitting decisions. Our regulations at 30 CFR part 773 
implement, in part, these statutory provisions.
    Bureau Form Number: None.
    Frequency of Collection: Occasionally.
    Description of Respondents: Applicants for permits to conduct 
surface coal mining and reclamation operations and State regulatory 
authorities.
    Total Annual Responses for All Respondents: 1,470.
    Total Annual Burden Hours: 10,955.

                                                       Information Collection for 30 CFR part 773
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                          Regulatory       Regulatory
                Section                    Applicant       Applicant       authority       authority       Total hours      Currently       Change to
                                           responses     burden hours      responses      burden hours                   approved hours    burden hours
--------------------------------------------------------------------------------------------------------------------------------------------------------
773.6 (a) & (b).......................             326            1.75             316              1               887             818            7069
773.10(c).............................               0            0                 33              5               165             150              15
773.12................................               0            0                282             32             9,024           9,312            (288)
773.14(b).............................              32            1                 32              1                64              32              32
773.19(b).............................               0            0                282               .5             141             146              (5)
773.19(e)(2)..........................              85            6                 82              2               674             600              74
    Totals............................             443  ..............           1,027  ...............          10,955          11,058            (103)
--------------------------------------------------------------------------------------------------------------------------------------------------------

30 CFR Part 774
    Title: Revision; Renewal; Transfer, Assignment, or Sale of Permit 
Rights; Post-Permit Issuance Requirements; and Other Actions Based on 
Ownership, Control, and Violation Information.
    OMB Control Number: 1029-0125.
    Summary: Sections 506 and 511 of SMCRA set forth requirements 
pertaining to, among other things, permit revisions; permit renewals; 
and transfers, assignments, or sales of permit rights. Section 507 and 
510 set forth requirements pertaining to, among other things, 
information required from applicants and, by extension, permittees and 
permit eligibility determinations. Regulatory authorities use the 
information collected, among other things, to determine whether a 
person is eligible for certain permit revisions; permit renewals; and 
transfers, assignments, or sales of permit rights. Our regulations at 
30 CFR part 774 implement, in part, these statutory provisions.
    Bureau Form Number: None.
    Frequency of Collection: Occasionally.
    Description of Respondents: Applicants for certain permit 
revisions, permit renewals, and transfers, assignments, or sales of 
permit rights; permittees required to report changes to information 
initially disclosed under 30 CFR 778.11; and State regulatory 
authorities.
    Total Annual Responses for all Respondents: 6,983.
    Total Annual Burden Hours: 58,525.

                                                       Information Collection for 30 CFR Part 774
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                          Regualtory       Regulatory
                Section                    Applicant       Applicant       authority       authority       Total hours      Currently       Change to
                                           responses     burden hours      responses      burden hours                   approved hours    burden hours
--------------------------------------------------------------------------------------------------------------------------------------------------------
774.12(a).............................              80            4                  0              0               320             240              80
774.12(c).............................             433            1.5              408               .5             854             490             364
774.13................................           1,978            8              1,929              8            31,256          32,400          (1,144)
774.15................................             734           16                719             16.5          23,608          12,377          11,231
774.17(b)(1)..........................             142            8                  0              0    ..............  ..............  ...............
774.17(b)(2)..........................             142             .75               0              0    ..............  ..............  ...............
774.17(d)(1)..........................               0            0                138              8             2,487           3,657          (1,170)
774.17(e)(1)..........................               0            0                138               .5  ..............  ..............  ...............
774.17(e)(2)..........................             142             .5                0              0    ..............  ..............  ...............
                                       -----------------------------------------------------------------------------------------------------------------
    Totals............................           3,651  ..............           3,332  ...............          58,525          49,164           9,361
--------------------------------------------------------------------------------------------------------------------------------------------------------

30 CFR Part 778
    Title: Permit Application--Minimum Requirements for Legal, 
Financial, Compliance, and Related Information.
    OMB Control Number: 1029-0117.
    Summary: Sections 507 and 510 of SMCRA require permit applicants to 
submit certain information to regulatory authorities. The required 
disclosures include information about the applicant's legal identity, 
business structure, and business relationships; permit and violation 
histories; and related information. Regulatory authorities use this 
information, in part, to make permit eligibility determinations. Our 
regulations at 30 CFR part 778 implement, in part, these statutory 
provisions.
    Bureau Form Number: None.
    Frequency of Collection: Once.
    Description of Respondents: Applicants for permits to conduct 
surface coal mining and reclamation operations and State regulatory 
authorities.
    Total Annual Responses for All Respondents: 3,099.
    Total Annual Burden Hours: 7,335.

[[Page 59609]]



                                                       Information Collection for 30 CFR part 778
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                           Regulatory      Regulatory
                Section                     Applicant       Applicant       authority       authority      Total hours      Currently       Change to
                                            responses     burden hours      responses     burden hours                   approved hours    burden hours
--------------------------------------------------------------------------------------------------------------------------------------------------------
778.9..................................             962            1.15               0               0           1,109           1,024              85
778.11.................................              81            5                  0               0             429             526             (97)
778.12.................................              81            4                  0               0             324             180             144
778.13.................................              81            4                  0               0             324             180             144
778.14.................................              81            2.4                0               0             194             120              74
778.15.................................             326            5                316               1           1,946           1,806             140
778.16.................................             218            8                215               1           1,896           1,710             186
778.17.................................             326            2                316               1             968             903              65
778.22.................................              49            2                 47               1             145             135              10
                                        ----------------------------------------------------------------------------------------------------------------
    Totals.............................           2,205  ..............             894  ..............           7,335           6,584             751
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Comments are invited on:
    (a) Whether the proposed collection of information is necessary for 
the proper performance of OSM and State regulatory authorities, 
including whether the information will have practical utility;
    (b) The accuracy of OSM's estimate of the burden of the proposed 
collection of information;
    (c) Ways to enhance the quality, utility, and clarity of the 
information to be collected; and
    (d) Ways to minimize the burden of collection on the respondents.
    Under the Paperwork Reduction Act, we must obtain OMB approval of 
all information and recordkeeping requirements. No person is required 
to respond to an information collection request unless the form or 
regulation requesting the information has a currently valid OMB control 
(clearance) number. To obtain a copy of OSM's information collection 
clearance request, explanatory information, and related forms, contact 
John A. Trelease at (202) 308-2783 or by e-mail at [email protected].
    By law, OMB must respond to OSM's request for approval within 60 
days of the publication of this proposed rule, but may respond as soon 
as 30 days after publication. Therefore, to ensure consideration by 
OMB, you must send comments regarding these burden estimates or any 
other aspect of these information collection and recordkeeping 
requirements by November 9, 2006, to the Office of Management and 
Budget, Office of Information and Regulatory Affairs, Attention: 
Interior Desk Officer, via e-mail to [email protected], or via 
telefacsimile to (202) 395-6566. Also, please send a copy of your 
comments to John A. Trelease, Office of Surface Mining Reclamation and 
Enforcement, Room 202-SIB, 1951 Constitution Avenue, NW., Washington, 
DC 20240, or electronically to [email protected].

11. National Environmental Policy Act

    We have reviewed this proposed rule and determined that it is 
categorically excluded from the National Environmental Policy Act of 
1969, as amended, 42 U.S.C. 4332 et seq. In addition, we have 
determined that none of the ``extraordinary circumstances'' exceptions 
to the categorical exclusion apply. This determination was made in 
accordance with the Departmental Manual (516 DM 2, Appendices 1.9 and 
2).

12. Effect of the Proposed Rule on State and Indian Programs

    Following publication of any final rule, we will evaluate the State 
and Indian programs approved under section 503 of SMCRA to determine 
any changes in those programs that may be necessary. When we determine 
that a particular State program provision should be amended, the 
particular State will be notified in accordance with the provisions of 
30 CFR 732.17. On the basis of this proposed rule, we have made a 
preliminary determination that State program revisions will be 
required. The revisions in the proposed rule would apply to Indian 
lands as a result of the cross-referencing in 30 CFR 750.12.

13. Clarity of This Proposed Rule

    Executive Order 12866 requires each agency to write regulations 
that are easy to understand. We invite your comments on how to make 
this proposed rule easier to understand, including answers to questions 
such as the following: (1) Are the requirements in the proposed rule 
clearly stated? (2) Does the proposed rule contain technical language 
or jargon that interferes with its clarity? (3) Does the format of the 
proposed rule (grouping and order of sections, use of headings, 
paragraphing, etc.) aid or reduce its clarity? (4) Would the rule be 
easier to understand if it were divided into more (but shorter) 
sections? (A ``section'' appears in bold type and is preceded by the 
symbol ``Sec.  '' and a numbered heading: for example, Sec.  773.14.) 
(5) Is the description of the proposed rule in the SUPPLEMENTARY 
INFORMATION section of this preamble helpful in understanding the 
proposed rule? (6) What else could we do to make the proposed rule 
easier to understand? Send a copy of any comments that concern how we 
could make this proposed rule easier to understand to: Office of 
Regulatory Affairs, Department of the Interior, Room 7229, 1849 C 
Street, NW., Washington, DC 20240. You may also e-mail the comments to 
this address: [email protected].

List of Subjects

30 CFR Part 701

    Law enforcement, Surface mining, Underground mining.

30 CFR Part 773

    Administrative practice and procedure, Reporting and record keeping 
requirements, Surface mining, Underground mining.

30 CFR Part 774

    Reporting and record keeping requirements, Surface mining, 
Underground mining.

30 CFR Part 778

    Reporting and record keeping requirements, Surface mining, 
Underground mining.

30 CFR Part 843

    Administrative practice and procedure, Law enforcement, Reporting 
and record keeping requirements, Surface mining, Underground mining.

[[Page 59610]]

30 CFR Part 847

    Administrative practice and procedure, Law enforcement, Penalties, 
Surface mining, Underground mining.

    Dated: September 26, 2006.
Chad Calvert,
Principal Deputy Assistant Secretary, Land and Minerals Management.
    For the reasons given in the preamble, OSM proposes to amend 30 CFR 
parts 701, 773, 774, 778, 843, and 847 as set forth below.

PART 701--PERMANENT REGULATORY PROGRAM

    1. The authority citation for part 701 continues to read as 
follows:


    Authority: 30 U.S.C. 1201 et seq.

    2. Amend Sec.  701.5 as follows:
    a. Revise the definition of control or controller.
    b. Revise the definition of own, owner, or ownership.
    c. Revise the definition of transfer, assignment, or sale of permit 
rights.
    The revisions read as follows:


Sec.  701.5  Definitions.

* * * * *
    Control or controller, when used in parts 773, 774, and 778 of this 
chapter, refers to or means--
    (1) A permittee of a surface coal mining operation;
    (2) An operator of a surface coal mining operation; or
    (3) Any other person who has the ability to determine the manner in 
which a surface coal mining operation is conducted.
* * * * *
    Own, owner, or ownership, as used in parts 773, 774, and 778 of 
this chapter (except when used in the context of ownership of real 
property), means being a sole proprietor or owning of record in excess 
of 50 percent of the voting securities or other instruments of 
ownership of an entity.
* * * * *
    Transfer, assignment, or sale of permit rights means a change of a 
permittee.
* * * * *

PART 773--REQUIREMENTS FOR PERMITS AND PERMIT PROCESSING

    3. The authority citation for part 773 continues to read as 
follows:


    Authority: 30 U.S.C. 1201 et seq., 16 U.S.C. 470 et seq., 16 
U.S.C. 661 et seq., 16 U.S.C. 703 et seq., 16 U.S.C. 668a et seq., 
16 U.S.C. 469 et seq., and 16 U.S.C. 1531 et seq.

    4. Revise Sec.  773.3 to read as follows:


Sec.  773.3  Information collection.

    The collections of information contained in part 773 have been 
approved by the Office of Management and Budget under 44 U.S.C. 3501 et 
seq. and assigned clearance number 1029-XXX1. The information collected 
will be used by the regulatory authority in processing surface coal 
mining permit applications. Persons intending to conduct surface coal 
mining operations must respond to obtain a benefit. A Federal agency 
may not conduct or sponsor, and a person is not required to respond to, 
a collection of information unless it displays a currently valid OMB 
control number. Response is required to obtain a benefit in accordance 
with SMCRA. Send comments regarding burden estimates or any other 
aspect of this collection of information, including suggestions for 
reducing the burden, to the Office of Surface Mining Reclamation and 
Enforcement, Information Collection Clearance Officer, Room 202--SIB, 
1951 Constitution Avenue, NW., Washington, DC 20240.
    5. In Sec.  773.7, revise paragraph (a) to read as follows:


Sec.  773.7  Review of permit applications.

    (a) The regulatory authority will review an application for a 
permit, revision, or renewal; written comments and objections 
submitted; and records of any informal conference or hearing held on 
the application and issue a written decision, within a reasonable time 
set by the regulatory authority, either granting, requiring 
modification of, or denying the application. If an informal conference 
is held under Sec.  773.6(c) of this part, the decision will be made 
within 60 days of the close of the conference.
* * * * *
    6. In Sec.  773.8, revise paragraph (b)(1) to read as follows:


Sec.  773.8  General provisions for review of permit application 
information and entry of information into AVS.

* * * * *
    (b) * * *
    (1) The information you are required to submit under Sec. Sec.  
778.11 and 778.12(c) of this subchapter.
* * * * *
    7. In Sec.  773.9, revise paragraph (a) to read as follows:


Sec.  773.9  Review of applicant and operator information.

    (a) We, the regulatory authority, will rely upon the information 
that you, the applicant, are required to submit under Sec.  778.11 of 
this subchapter, information from AVS, and any other available 
information, to review your and your operator's organizational 
structure and ownership or control relationships.
* * * * *
    8. In Sec.  773.10, revise paragraphs (b) and (c) to read as 
follows:


Sec.  773.10  Review of permit history.

* * * * *
    (b) We will also determine if you or your operator have previous 
mining experience.
    (c) If you or your operator do not have any previous mining 
experience, we may conduct an additional review under Sec.  774.11(f) 
of this subchapter. The purpose of this review will be to determine if 
someone else with mining experience controls the mining operation.
    9. In Sec.  773.12, revise paragraphs (a)(1) and (a)(2), remove 
paragraphs (a)(3) and (b), and redesignate paragraphs (c), (d), and (e) 
as paragraphs (b), (c), and (d), respectively, to read as follows:


Sec.  773.12  Permit eligibility determination.

* * * * *
    (a) * * *
    (1) You directly own or control has an unabated or uncorrected 
violation; or
    (2) You or your operator indirectly control has an unabated or 
uncorrected violation and your control was established or the violation 
was cited after November 2, 1988.
* * * * *
    10. In Sec.  773.14, revise paragraph (b) introductory text to read 
as follows:


Sec.  773.14  Eligibility for provisionally issued permits.

* * * * *
    (b) We, the regulatory authority, will find you eligible for a 
provisionally issued permit under this section if you demonstrate that 
one or more of the following circumstances exists with respect to all 
violations listed in paragraph (a) of this section--
* * * * *
    11. In Sec.  773.21, revise paragraph (c) to read as follows:


Sec.  773.21  Initial review and finding requirements for improvidently 
issued permits.

* * * * *
    (c) When we make a preliminary finding under paragraph (a) of this 
section, we must serve you with a written notice of the preliminary 
finding, which must be based on evidence sufficient to establish a 
prima facie case that your permit was improvidently issued.
* * * * *
    12. Amend Sec.  773.22, by removing paragraph (d) and redesignating

[[Page 59611]]

paragraphs (e), (f), (g), and (h) as (d), (e), (f), and (g), 
respectively.
    13. In Sec.  773.23, revise paragraph (c)(2) to read as follows:


Sec.  773.23  Suspension or rescission requirements for improvidently 
issued permits.

* * * * *
    (c) * * *
    (2) Post the notice at our office closest to the permit area.
* * * * *
    14. In Sec.  773.26, revise the table in paragraph (a) and add new 
paragraph (e) to read as follows:


Sec.  773.26  How to challenge an ownership or control listing or 
finding.

* * * * *
    (a) * * *

------------------------------------------------------------------------
                                        Then you must submit a written
   If the challenge concerns . . .           explanation to . . .
------------------------------------------------------------------------
(1) A pending State or Federal        The regulatory authority with
 permit application . . .              jurisdiction over the
                                       application.
(2) Your ownership or control of a    The regulatory authority with
 surface coal mining operation, and    jurisdiction over the surface
 you are not currently seeking a       coal mining operation.
 permit . . .
------------------------------------------------------------------------

* * * * *
    (e) At any time, you, a person listed in AVS as an owner or 
controller of a surface coal mining operation, may request an informal 
explanation from the AVS Office as to the reason you are shown in AVS 
in an ownership or control capacity. Within 14 days of your request, 
the AVS Office will provide a response describing why you are listed in 
AVS.
    15. In Sec.  773.27, revise paragraph (a) to read as follows:


Sec.  773.27  Burden of proof for ownership or control challenges.

* * * * *
    (a) When you challenge a listing of ownership or control, or a 
finding of ownership or control made under Sec.  774.11(f) of this 
subchapter, you must prove by a preponderance of the evidence that you 
either--
    (1) Do not own or control the entire surface coal mining operation 
or relevant portion or aspect thereof; or
    (2) Did not own or control the entire surface coal mining operation 
or relevant portion or aspect thereof during the relevant time period.
* * * * *
    16. In Sec.  773.28, revise paragraph (d) to read as follows:


Sec.  773.28  Written agency decision on challenges to ownership or 
control listings or findings.

* * * * *
    (d) We will post all decisions made under this section on AVS.
* * * * *

PART 774--REVISION; RENEWAL; TRANSFER, ASSIGNMENT, OR SALE OF 
PERMIT RIGHTS; POST-PERMIT ISSUANCE REQUIREMENTS; AND OTHER ACTIONS 
BASED ON OWNERSHIP, CONTROL, AND VIOLATION INFORMATION

    17. The authority citation for part 774 continues to read as 
follows:


    Authority: 30 U.S.C. 1201 et seq.

    18. Revise Sec.  774.9 to read as follows:


Sec.  774.9  Information collection.

    (a) The collections of information contained in part 774 have been 
approved by the Office of Management and Budget under 44 U.S.C. 3501 et 
seq. and assigned clearance number 1029-XXX2. Regulatory authorities 
will use this information to:
    (1) Determine if the applicant meets the requirements for revision; 
renewal; transfer, assignment, or sale of permit rights;
    (2) Enter and update information in AVS following the issuance of a 
permit; and
    (3) Fulfill post-permit issuance requirements and other obligations 
based on ownership, control, and violation information.
    (b) A Federal agency may not conduct or sponsor, and a person is 
not required to respond to, a collection of information unless it 
displays a currently valid OMB control number. Response is required to 
obtain a benefit in accordance with SMCRA. Send comments regarding 
burden estimates or any other aspect of this collection of information, 
including suggestions for reducing the burden, to the Office of Surface 
Mining Reclamation and Enforcement, Information Collection Clearance 
Officer, Room 202-SIB, 1951 Constitution Avenue, NW., Washington, DC 
20240.
    19. Amend Sec.  774.11 as follows:
    a. Revise the table in paragraph (a).
    b. Revise paragraphs (e), (f), and (g).
    c. Add new paragraphs (h) and (i).
    The amendments read as follows:


Sec.  774.11  Post-permit issuance requirements for regulatory 
authorities and other actions based on ownership, control, and 
violation information.

    (a) * * *

------------------------------------------------------------------------
     We must enter into AVS all . . .        Within 30 days after . . .
------------------------------------------------------------------------
(1) Permit records........................  The permit is issued or
                                             subsequent changes made.
(2) Unabated or uncorrected violations....  The abatement or correction
                                             period for a violation
                                             expires.
(3) Changes to information initially        Receiving notice of a
 required to be provided by an applicant     change.
 under 30 CFR 778.11.
(4) Changes in violation status...........  Abatement, correction, or
                                             termination of a violation,
                                             or a decision from an
                                             administrative or judicial
                                             tribunal.
------------------------------------------------------------------------

* * * * *
    (e) Entry into AVS.
    (1) If you do not request a hearing, and the time for seeking a 
hearing has expired, we will enter our finding into AVS.
    (2) If you request a hearing, we will enter our finding into AVS 
only if that finding is upheld on administrative appeal.
    (f) At any time, we may identify any person who owns or controls an 
entire operation or any relevant portion or aspect thereof. If we 
identify such a person, we must issue a written finding to the person 
and the applicant or permittee describing the nature and extent of 
ownership or control. Our written finding must be based on evidence 
sufficient to establish a prima facie case of ownership or control.
    (g) After we issue a written finding under paragraph (f) of this 
section, we will allow you, the person subject to the finding, 30 days 
in which to submit any information tending to demonstrate your lack of 
ownership or control. If, after reviewing any information you submit, 
we are persuaded that you are not an owner or controller, we will serve 
you a written notice to that effect. If, after reviewing any 
information you submit, we still find that you are an owner or 
controller or if you do not submit any information within the 30-day 
period, we must enter our finding under paragraph (f) into AVS.
    (h) We need not make a finding as provided for under paragraph (f) 
of this section before entering into AVS the information required to be 
disclosed under Sec.  778.11(b) and (c) of this subchapter; however, 
the mere listing in AVS of a person identified in Sec.  778.11(b) or 
(c) does not create a presumption or constitute a determination that 
such person owns or

[[Page 59612]]

controls a surface coal mining operation.
    (i) If we identify you as an owner or controller under paragraph 
(f) of this section, you may challenge the finding using the provisions 
of Sec. Sec.  773.25, 773.26, and 773.27 of this subchapter.
    20. In Sec.  774.12, revise paragraph (c) to read as follows:


Sec.  774.12  Post-permit issuance information requirements for 
permittees.

* * * * *
    (c) Within 60 days of any addition, departure, or change in 
position of any person identified in Sec.  778.11(c) of this 
subchapter, you must provide--
    (1) The information required under Sec.  778.11(d) of this 
subchapter;
    (2) The date of any departure; and
    (3) Written notification of the addition, departure, or change to 
the surety, bonding entity, guarantor, or other person that provides 
the bond coverage currently in effect. Further, as a result of these 
additions, departures, or changes, the regulatory authority may require 
written verification of continued appropriate bond coverage under 
subchapter J of this chapter.
    21. In Sec.  774.17, revise paragraph (a), paragraph (d) 
introductory text, and paragraph (d)(1) to read as follows:


Sec.  774.17  Transfer, assignment, or sale of permit rights.

* * * * *
    (a) General. No transfer, assignment, or sale of rights granted by 
a permit shall be made without the prior written approval of the 
regulatory authority. At its discretion, the regulatory authority may 
allow a successor in interest to engage in surface coal mining and 
reclamation operations under the permit during the pendency of an 
application for approval of a transfer, assignment, or sale of permit 
rights submitted under paragraph (b) of this section, provided that the 
successor in interest can demonstrate to the satisfaction of the 
regulatory authority that sufficient bond coverage will remain in 
place.
* * * * *
    (d) Criteria for approval. The regulatory authority may allow a 
permittee to transfer, assign, or sell permit rights to a successor, if 
it finds in writing that the successor--
    (1) Is eligible to receive a permit in accordance with Sec. Sec.  
773.12 and 773.14 of this chapter;
* * * * *

PART 778--PERMIT APPLICATIONS--MINIMUM REQUIREMENTS FOR LEGAL, 
FINANCIAL, COMPLIANCE, AND RELATED INFORMATION

    22. The authority citation for part 778 continues to read as 
follows:


    Authority: 30 U.S.C. 1201 et seq.

    23. Revise Sec.  778.8 to read as follows:


Sec.  778.8  Information collection.

    The collections of information contained in part 778 have been 
approved by the Office of Management and Budget under 44 U.S.C. 3501 et 
seq. and assigned clearance number 1029-XXX3. The information collected 
will be used by the regulatory authority to ensure that all legal, 
financial, and compliance information requirements are satisfied before 
issuance of a permit. Persons intending to conduct surface coal mining 
operations must respond to obtain a benefit. A Federal agency may not 
conduct or sponsor, and a person is not required to respond to, a 
collection of information unless it displays a currently valid OMB 
control number. Response is required to obtain a benefit in accordance 
with SMCRA. Send comments regarding burden estimates or any other 
aspect of this collection of information, including suggestions for 
reducing the burden, to the Office of Surface Mining Reclamation and 
Enforcement, Information Collection Clearance Officer, Room 202-SIB, 
1951 Constitution Avenue, NW., Washington, DC 20240.
    24. Amend Sec.  778.11 as follows:
    a. Revise the section heading.
    b. Revise paragraph (a) introductory text and paragraphs (a)(1), 
(b)(4), and (c).
    c. Remove paragraph (d).
    d. Redesignate paragraph (e) as paragraph (d).
    e. Revise newly designated paragraph (d) introductory text.
    The revisions read as follows:


Sec.  778.11  Providing applicant and operator information.

    (a) You, the applicant, must provide in the permit application--
    (1) A statement indicating whether you and your operator are 
corporations, partnerships, associations, sole proprietorships, or 
other business entities;
* * * * *
    (b) * * *
    (4) Each business entity in the applicant's and operator's 
organizational structure, up to and including the ultimate parent 
entity.
    (c) For you and your operator, you must provide the information 
required by paragraph (d) of this section for every--
    (1) Officer.
    (2) Partner.
    (3) Member.
    (4) Director.
    (5) Person performing a function similar to a director.
    (6) Person who owns, of record, 10 percent or more of the applicant 
or operator.
    (d) You must provide the following information for each person 
listed in paragraph (c) of this section--
* * * * *

PART 843--FEDERAL ENFORCEMENT

    25. The authority citation for part 843 continues to read as 
follows:


    Authority: 30 U.S.C. 1201 et seq.

Sec.  843.21  [Removed]

    26. Remove Sec.  843.21.

PART 847--ALTERNATIVE ENFORCEMENT

    27. The authority citation for part 847 continues to read as 
follows:


    Authority: 30 U.S.C. 1201 et seq.

    28. In Sec.  847.11, revise the introductory text to read as 
follows:


Sec.  847.11  Criminal penalties.

    Under sections 518(e) and (g) of the Act, we, the regulatory 
authority, may request the Attorney General to pursue criminal 
penalties against any person who--
* * * * *
    29. In Sec.  847.16, revise paragraph (a) introductory text to read 
as follows:


Sec.  847.16  Civil actions for relief.

    (a) Under section 521(c) of the Act, we, the regulatory authority, 
may request the Attorney General to institute a civil action for relief 
whenever you, the permittee, or your agent--
* * * * *
[FR Doc. E6-16575 Filed 10-6-06; 8:45 am]
BILLING CODE 4310-05-P