November 2, 1994—Public Law 103-448, the Healthy Meals for Healthy Americans Act of 1994, amended Section 9 of the Richard B. Russell National School Lunch Act (NSLA), 42 U.S.C. 1758, to statutorily provide for the first time, some disclosure of children's eligibility information, without parental consent, to specified programs, such as Federal and State education programs and to certain individuals. The provisions of Public Law 103-448 specifically exclude disclosures of children's eligibility information to Medicaid but did not address disclosures to the State Children's Health Insurance Program (SCHIP), which was nonexistent at that time.

June 20, 2000—Public Law 106-224, the Agricultural Risk Protection Act of 2000, amended the NSLA to allow disclosure of children's eligibility information to Medicaid and SCHIP, provided that parents/guardians not decline to have their information disclosed to those health insurance programs. Congress directed the Secretary to promulgate regulations without regard to the provisions of Administrative Procedure Act, the Statement of Policy of the Secretary of Agriculture, effective July 24, 1971 (36 FR 13804) and the Paperwork Reduction Act.

July 25, 2000—A proposed rule, with a request for comments, was published in the Federal Register (65 FR 45725).

January 11, 2001—An interim rule, with a request for comments, amended a number of program regulations to implement the Medicaid and SCHIP disclosure provisions of Public Law 106-224. The regulatory provisions were effective October 1, 2000, in accordance with Public Law 106-224.

June 30, 2004—Public Law 108-265, Child Nutrition and WIC Reauthorization Act of 2004 (Pub. L. 108-265) further amended the NSLA to specify that Medicaid and SCHIP officials may request that determining officials for the Child Nutrition Programs verify children's eligibility for free and reduced price meal and free milk benefits.

This final rule—Finalizes the current regulations codified by the interim rule, which only addressed disclosures to Medicaid and SCHIP, and amends the current regulations to add the provisions from the July 25, 2000 proposed rule and the confidentiality provision from Public Law 108-265.

A detailed discussion of the confidentiality provisions of the public laws and the actions taken to address the provisions follows.

The Healthy Meals for Healthy Americans Act of 1994, Public Law 103-448, enacted on November 2, 1994, amended section 9(b)(2)(C) of the Richard B. Russell National School Lunch Act (NSLA) (42 U.S.C. 1758(b)(2)(C)) to allow limited access to children's free and reduced price meal information, without parental/guardian consent. In general, the statute included the following provisions:

1. Authorized disclosure of children's eligibility status only (whether children are eligible for free meals or reduced price meals) to:

• Persons who are directly connected with the administration or enforcement of programs under the NSLA or the Child Nutrition Act of 1966 (CNA) (42 U.S.C. 1771 et seq. ) or a regulation issued under either of those Acts;

• Persons who are directly connected with the administration or enforcement of a Federal education program;

• Persons who are directly connected with the administration or enforcement of a State health or education program (other than Medicaid) administered by the State or local education agency; and

• Persons who are directly connected with the administration or enforcement of a Federal, State or local means-tested nutrition program with eligibility standards comparable to the National School Lunch Program (NSLP).

2. Authorized disclosure of all eligibility information for children that is obtained through the free and reduced price meal application process or through the direct certification process (determining children eligible based on information obtained from certain other agencies) to:

• The Comptroller General of the United States for audit and examination; and

• Certain law enforcement officials investigating alleged program violations.

3. Specified penalties for unauthorized disclosure or misuse of children's eligibility information of a fine of not more than $1000 or imprisonment of not more than 1 year, or both.

Public Law 103-448 specifically excluded disclosure of children's eligibility information, without consent, to a program under title XIX of the Social Security Act, i.e. , Medicaid (42 U.S.C. 1396 et seq .), and did not address disclosure of children's eligibility information to SCHIP, which was established in later Federal legislation. The Department issued a proposed rule, which would have extended the provisions to all the Child Nutrition Programs, (65 FR 45725, July 25, 2000) with a 90-day public comment period to implement the disclosure provisions of Public Law 103-448.

The Agricultural Risk Protection Act of 2000, Public Law 106-224, enacted on June 20, 2000, further amended the disclosure provisions in section 9(b)(2)(C) of the NSLA (42 U.S.C. 1758(b)(2)(C)). In general, Public Law 106-224 included the following provisions:

1. Authorized disclosure of children's eligibility information to Medicaid and SCHIP provided that the following conditions are met:

• Both the State agency and school food authority must elect to disclose eligibility information to these health insurance programs;

• School and health insurance program officials must have a written agreement that requires the health insurance program to use the information to seek to enroll children in Medicaid and SCHIP; and

• Parents/guardians must be notified that their eligibility information may be disclosed to Medicaid or SCHIP and given an opportunity to decline to have their children's eligibility information disclosed.

2. Directed the Department to promptly promulgate regulations to implement the disclosure provisions of Public Law 106-224 without regard to the Administrative Procedure Act's notice and comment provisions, the Statement of Policy of the Secretary of Agriculture effective July 24, 1971 (36 FR 13804) or the Paperwork Reduction Act facilitated making health insurance benefits available to low-income children as quickly as possible.

In implementing the provisions of Public Law 106-224, the Department issued an interim rule with a request for comments (66 FR 2195, January 11, 2001). The Department sought comments on the disclosure of eligibility information to Medicaid and SCHIP due to the sensitivity of household privacy issues and also to gain insights on operational experience prior to issuing a final regulation. Additionally, at the time, the Department was reviewing comments received on its proposed rule to implement the disclosure provisions of Public Law 103-448 (discussed above) which would allow the disclosure of eligibility information to education and several other programs and individuals. The interim rule became effective on October 1, 2000, and amended 7 CFR Parts 215, 225, 226, and 245 to allow determining agencies (agencies responsible for the determination of free and reduced price meals or free milk) to disclose children's eligibility information to Medicaid and SCHIP under the conditions mandated by Public Law 106-224, as listed above. Issuance of an interim rule allowed the Department to comply with the Congressional mandate to promulgate regulations regarding disclosures to Medicaid and SCHIP, and to collect public comment on these important requirements. As stated in the Preamble to the interim rule, it was our clear intent to then publish a final rule, incorporating the comments received.

The Child Nutrition and WIC Reauthorization Act of 2004, enacted June 30, 2004, (Pub. L. 108-265) amended the Richard B. Russell National School Lunch Act in a number of ways. First, it redesignated section 9(b)(2)(C)(iii), which contains the disclosure provisions, to section 9(b)(6) and second, titled the section “Use or Disclosure of Information.” Third, Public Law 108-265 added a provision allowing school officials to provide third party contractors access to children's free and reduced price meal eligibility status when the contractors are assisting school food authorities with contacting households which do not respond to the school's verification efforts. The amendments were nondiscretionary and are codified in this final rule at 7 CFR 215.13a(g)(1), 225.15(g)(1), 226.23(i)(1) and 245.6(k)(1). Finally, the NSLA now allows Medicaid and SCHIP officials to use the eligibility information to verify children's eligibility for programs under the NSLA or CNA. Previously, determining officials could disclose children's eligibility information to Medicaid and SCHIP solely for the purpose of identifying and enrolling eligible children in a health insurance program. These statutory provisions were also non-discretionary and are codified in this final rule at 7 CFR 215.13a (h)(2), 225.15(h)(2), 226.23(j)(2), and 245.6(g)(2).

Regulations for the Child Nutrition Programs, as amended by the interim rule to implement Public Law 106-224, in general allow the disclosure of children's free and reduced price meal eligibility information to Medicaid and SCHIP officials when both the State agency and school food authority elect to disclose eligibility information to these health insurance programs; when determining agencies and health insurance program officials have a written agreement that requires the health insurance program agency to use the information to seek to enroll eligible children in Medicaid and SCHIP; and when parents/guardians are given an opportunity to decline to have their children's eligibility information disclosed. Sections 215.2, 225.2, 226.2 and 245.2 include definitions for the terms “Disclosure,” “Medicaid” and “SCHIP.”

Current 7 CFR Part 215, as amended by the interim rule, requires that the free milk application used in child care centers include a Privacy Act notice/statement. Note that schools that participate in the SMP follow the provisions contained in 7 CFR Part 245, which includes requirements for a Privacy Act notice/statement. Section 215.13a provides a prototype Privacy Act notice/statement for the milk application and the prototype Privacy Act notices/statements provided in 7 CFR Parts 225, 226 and 245 were revised to be consistent with the simplified notice/statement added to 7 CFR Part 215.

Guidance was issued December 1998, to explain the disclosure provisions of Public Law 103-448 contained in the proposed rule. The proposed rule was published in 2000. Determining agencies are operating under that guidance for disclosures to education and certain other programs and activities specified in Public Law 103-448. Additionally, the Department issued guidance on disclosing eligibility information in cases when parents/guardians authorize the disclosure. Parents/guardians may provide consent for the disclosure of information that goes beyond that authorized by the statute.

We received twelve comments on the proposed rule and eight comments on the interim rule. Commenters generally were supportive of the proposed and interim rules in that they believe that the provisions are in accordance with the statute. Several commenters view the sharing of free and reduced price eligibility information as helpful in streamlining the enrollment process for other programs that also serve low-income individuals. Other commenters oppose any sharing of households' free and reduced price meal or free milk eligibility information. They cite privacy concerns, the potential for deterring participation in the Child Nutrition Programs and additional burdens on school food service staff due to requests for children's free and reduced price eligibility information. This preamble discusses the specific provisions and comments received.

In general, no major changes are being made to the current regulations relating to the disclosure of children's eligibility information to Medicaid and SCHIP. However, Section 104 (b)(i) of Public Law 108-265 amended the disclosure provisions contained in the NSLA. As a result, Medicaid and SCHIP officials are now allowed to verify children's eligibility for a program under the NSLA or Child Nutrition Act of 1966. An amendment to current regulations to accommodate this nondiscretionary provision is included in this rule.

Additionally, because this rule adds the disclosure provisions of Public Law 103-448 and Public Law 108-265 to the current disclosure provisions, the section numbers for many of the provisions are changed from the current or proposed designations and obsolete references are deleted. Further, several commenters did not like the section headings in question format. Because of their concerns, the section headings are revised to a statement format consistent with most of the sections headings currently in the regulations. For a detailed explanation of the provisions, the reader may refer to the interim and proposed rules published at 65 FR 45725 and 66 FR 2195, respectively. A discussion of the major provisions follows.

1. Applicability to all the Child Nutrition Programs—Although the NSLA addresses the disclosure of children's free and reduced price school lunch eligibility information, the interim rule extended the provisions to all the Child Nutrition Programs to provide consistency among the programs. This was consistent with Food and Nutrition Service's (FNS) practices and policies as discussed in the interim rule. The proposed rule also would have extended the disclosure provisions to all the Child Nutrition Programs. Commenters did not address this issue.

Final rule—The disclosure provisions continue to apply to all the Child Nutrition Programs.

2. Definitions—The interim rule added the terms, “disclosure,” “Medicaid” and “State Children's Health Insurance Program (SCHIP)” to current §§ 215.2, 225.2, 226.2, and 245.2 in the alphabetical lists of definitions. One commenter addressed the definitions and that commenter concurred with the meanings ascribed to the terms. The proposed rule did not include any definitions.

Final Rule— In §§ 215.2, 225.2, 226.2, and 245.2, the definitions “Medicaid” and “State Children's Health Insurance Program (SCHIP)” are adopted without change. The definition “Disclosure” is revised in this final rule to improve readability. No substantial changes are made to the definition.

3. Prototype Privacy Act Notice/Statement—The interim rule revised the programs' previous regulatory prototype Privacy Act notice/statement to make the notice/statement more understandable by simplifying the wording. The Privacy Act notice/statement must inform households whether the information being requested is mandatory or voluntary; the authority for the request; how the information may be used; and the consequence of not providing the information. Sections 215.13a(f), 225.15(f)(4)(iv), 226.23(e)(1)(ii)(F) and 245.6(a)(1) currently provide a prototype statement. Additionally, §§ 215.13a(g)(6), 225.15(g)(6), 226.23(i)(6), and 245.6(f )(6) require schools and institutions intending to disclose social security numbers to include additional information in their Privacy Act notices/statements that inform households of the potential disclosures and the planned uses of the numbers. The NSLA permits the disclosure of all eligibility information to some entities. This disclosure may include the social security number of the adult household member who signs the application. Social security numbers also may be disclosed with prior notice and parental/guardian consent.

One commenter addressed the Privacy Act notice/statement and expressed agreement with the Department that households should be made aware of potential uses of the information. The Department reminds readers that State agencies and school food authorities are responsible for ensuring that the Privacy Act notice/statement included on their applications comply with section 7(b) of the Privacy Act.

Final Rule—Sections 215.13a(f), 215.13a(i), 225.15(f)(4)(iv), 225.15(i)(1), 226.23(e)(1)(ii)(F), 226.23(k), and 245.6(a)(1) and 245.6(h) provide a prototype Privacy Act notice/statement and require that households be given adequate notice regarding the request for free and reduced price eligibility information and how the information, including social security numbers, will be used.

4. Responsibility for deciding whether to disclose eligibility information—Currently, §§ 215.13a(g)(1), 225.15(g)(1), 226.23(i)(1), and 245.6(f)(1) require that both the State agency and local agency that determines free and reduced price meal or free milk eligibility must agree on whether to disclose eligibility information to Medicaid and SCHIP officials. This shared responsibility for determining whether to disclose information to Medicaid and SCHIP is mandated by the NSLA as amended by Public Law 106-224 and was included in the interim regulations.

Unlike with disclosures to Medicaid and SCHIP, the NSLA does not address who has the responsibility for deciding whether to disclose eligibility information to education and other programs authorized to receive eligibility information under Public Law 103-448. The proposed rule and this final rule place this responsibility on the determining agency. As noted in the preamble to the interim rule, the determining agency may be the State agency, when that agency makes the eligibility determination, or it may be a school within the school food authority, a child care institution, or a Summer Food Service Program sponsor who makes the free and reduced price meal or free milk eligibility determinations. No comments were received on this provision.

Two individuals commenting on the proposed rule expressed concern that it would be difficult to refuse requests for eligibility information. We agree that there often is pressure to disclose eligibility information. Determining agencies must evaluate each request for information to ensure that, at a minimum, the disclosure is in accordance with statutory and regulatory provisions. Additionally, determining agencies should consider, along with the agency requesting the information, whether aggregate data is sufficient.

Although currently the National School Lunch Program (NSLP), School Breakfast Program (SBP), Special Milk Program (SMP), Child and Adult Care Food Program (CACFP), and Summer Food Service Program (SFSP) regulations do not address the disclosure of aggregate information, the disclosure of aggregate data is allowed because individuals cannot be personally identified. This is consistent with longstanding FNS policy and practices. As proposed at §§ 215.13a(g)(2), 225.15(g)(2), 226.23(i)(2), and 245.6(f)(2), we would codify this policy. A commenter stated that the disclosure of aggregate information could result in the disclosure of personal information. The Department acknowledges that it might be possible for a determining agency to improperly disclose information making a person's identity recognizable. Determining officials should be aware of the possibility of inadvertently disclosing personally identifiable information when releasing aggregate information, carefully reviewing the data to ensure that the identities of children or their households are masked or cannot be identified by the combining of information or by deduction. This is essential in every disclosure.

Final Rule—Sections 215.13a(g), 225.15(g), 226.23(i), and 245.6(f) specify that determining agencies may release aggregate data, without parental/guardian consent, provided children cannot be identified through disclosure of the data or by deduction and that determining agencies are responsible for deciding whether to disclose eligibility information; and that, for disclosures to individuals and programs other than to Medicaid and SCHIP, determining agencies are responsible for deciding whether or not to disclose individual children's eligibility. Readers are reminded that State agencies may prohibit the disclosure of free and reduced price eligibility information in schools and institutions under their jurisdiction at their discretion. For disclosures to Medicaid and SCHIP, §§ 215.13a(h), 225.15(h), 226.23(j) and 245.6(g) of this final rule continue to require that both the State agency and local determining agency must agree to disclose eligibility information to Medicaid and SCHIP.

5. Notice to parents about potential disclosures—Currently, once the joint decision is made by State agencies and local determining agencies to release information to Medicaid and SCHIP, the regulations at §§ 215.13a(g)(5), 225.15(g)(5), 226.23(i)(5), and 245.6(f)(5) require that parents are notified of the upcoming disclosure and given opportunity to decline the disclosure, as mandated by the NSLA. For disclosures to education and other programs and individuals permitted access to eligibility information by the NSLA permits the disclosure without parental/guardian consent and does not include a requirement for parental/guardian notification prior to the disclosure. The proposed rule would not have required notification to parents/guardians of potential disclosures to education and other programs and individuals, as long as the disclosure was in accordance with the NSLA, i.e. , disclosure of names and eligibility status. However, the preamble to the proposed rule suggested that officials notify parents of how their information will be used. It was suggested that officials include the notification in the letter/notice to parents that accompanies the free and reduced price meal and free milk application; on the application; or in the case of direct certification, on the document informing households of their eligibility. One commenter addressed this provision. The commenter believes that parents should be informed of all disclosures. The Department agrees.

Final Rule—Sections 215.13a(i), 225.15(i), 226.23(k) and 245.6(h) require determining agencies to notify parents/guardians of potential disclosure of their eligibility information at the time of application or when the household is directly certified.

6. Parental consent/declination to the disclosure of the household's eligibility information—As mentioned above, prior to any disclosure to Medicaid or SCHIP, parents/guardians must be given the opportunity to decline to have their information disclosed to those health insurance agencies; i.e. , opt out. This opt out provision was mandated by a provision in Public Law 106-224 amending the NSLA and is currently codified at §§ 215.13a(g)(5), 225.15(g)(5), 226.23(i)(5), and 245.6(f)(5). No specific timeframe for households to respond was specified in the NSLA or the rule. Rather the regulations require that households be informed that their information may be disclosed to Medicaid and SCHIP unless they notify the determining agency by a date, chosen by the determining agency, if they do not want their information disclosed to those health insurance agencies. No response from the parent/guardian by the date specified is considered consent, ( i.e. , passive consent) and allows the determining agency to disclose children's eligibility information to Medicaid and SCHIP.

Previously, amendments to the NSLA by Public Law 103-448 authorized determining agencies to disclose certain limited information to educational and certain other programs and individuals without parental/guardian consent. Therefore, §§ 215.13a(g)(8) and (g)(9), 225.15(g)(8) and(g)(9), 226.23(i)(8) and (g)(9), and 245.6(f)(8) and (f)(9) of the proposed rule would have, without requiring parental/guardian consent, permitted determining agencies to make disclosure consistent with the NSLA.

An indication of parental/guardian consent, however, would be required when the disclosure would go beyond the scope of the statute, such as a disclosure to a program or individual not authorized by the statute to receive eligibility information or the disclosure of information goes beyond the information allowed by the statute to be disclosed to a particular entity. For example, a Federal education program is authorized to have information regarding a student's eligibility status but no other information on the application. If an education program wanted names of household members, the determining agency must obtain parental/guardian consent prior to disclosing that information. Additionally, some determining agencies include on the free and reduced price meal application a list of other benefits, such as programs or services for which a household may be eligible; i.e. , free or reduced cost bus transportation, text books, eye exams, or other school related fees. In those cases, to obtain a listed benefit, the parent/guardian must take action, ( i.e. , check a box to indicate consent (opt in)), before their information may be disclosed.

One individual commenting on the interim rule suggested that the parents be given, by regulation, a specified length of time to respond before consent to disclose information to Medicaid or SCHIP is assumed. Currently, §§ 215.13a(g)(5), 245.6(f)(5), 225.15(g)(5) and 226.23(i)(5) require that parents must be given adequate time to respond before information is disclosed, but leaves it to local agencies to determine how much time is adequate. The Department has determined that local officials are in a better position to assess what constitutes adequate time to respond.

Additionally, a commenter took the position that requiring the parent to actively provide consent is preferable to passive consent; i.e. , assuming consent when the parent/guardian does not notify/indicate that they do not want their information disclosed. The former is the case with disclosures to Medicaid and SCHIP. The commenter stated that most other disclosures require the parents to take action by providing a check mark, for example, to indicate that their information may be disclosed. The commenter believes that consistency would be less confusing for parents/guardians. Public Law 106-224 mandates that disclosures to Medicaid and SCHIP be allowed to occur unless parents/guardians decline to have their information disclosed to the health insurance programs, ( i.e. , opt out). Also, it has been the Department's long-standing policy and practice to require that determining agencies provide parents/guardians the opportunity to opt in when the determining agency provides parents/guardians a choice on whether they want their free and reduced price eligibility information used for other purposes. Providing parents/guardians with the opportunity to agree to have their information used for purposes other than for the purpose for which the information was originally provided, ( i.e. , for determining eligibility for free and reduced price meals), gives parents/guardians greater control over their personal information than the opt out approach.

Final rule—For the reasons cited above, §§ 215.13a(i)(2), 225.15(i)(2), 226.23(k)(2) and 245.6(h)(2) continue to require that determining agencies which have decided to disclose information to Medicaid and SCHIP provide parents/guardians the opportunity to decline to have their information disclosed to those health insurance agencies (opt out). Sections 215.13a(j), 225.15(j), 226.23(l) and 245.6(i) require that determining agencies that want to use free and reduced price meal eligibility information for other purposes or that want to disclose the information to programs and individuals who are not authorized to have access to household information by the statute must provide parents/guardians with the opportunity to consent to having their information disclosed. Additionally, no consent is required for disclosure to education and other programs permitted access to children's eligibility status as provided in the statute.

7. Disclosure of information obtained through the verification of eligibility process—The proposed rule included a provision to allow, without parental/guardian consent, the disclosure of household information obtained from sources other than the free and reduced price application or through direct certification, such as information obtained through the verification process. The interim rule did not include a similar provision and, therefore, it is not included in current regulations. Five commenters to the proposed rule opposed the disclosure of information obtained through the verification process stating that this went beyond the disclosure provisions in the NSLA. The Department agrees that the disclosure of eligibility information should be limited to information provided by households on the application or obtained through direct certification, as specified in the statute and should not include information obtained through the verification process.

Final rule: For the reasons cited above, this final rule does not include authority for determining agencies to disclose information obtained through the verification of eligibility process.

8. Persons authorized to receive children's eligibility information and how the information must be used—The NSLA specifies that individuals authorized access to children's eligibility information for health insurance purposes must be directly connected with the administration of the Medicaid Program or SCHIP. Additionally, the NSLA requires that, for education and the other specified programs or activities listed, the individuals must be either directly connected with administration of the specified program or activity or directly connected to its enforcement. The Department has also specified in guidance that these authorized individuals also must have a need to know children's eligibility information to carry out their duties, since the information must be used for program purposes.

As mandated by the statute, current regulations specify that persons directly connected to the administration of Medicaid or SCHIP are permitted access to children's eligibility information to identify children eligible for enrollment in Medicaid or SCHIP, provided that parents/guardians have not declined to have their information disclosed to those health insurance programs. Public Law 108-265 further allows determining agencies to communicate with Medicaid and SCHIP officials to verify children's eligibility for a Child Nutrition Program. This provision is nondiscretionary and is being added to this final rule. Currently, §§ 215.13a(g)(3), 225.15(g)(3), 226.23(i)(3), and 245.6(f)(3) define a person directly connected with Medicaid and SCHIP as State employees and persons authorized under Federal requirements to carry out initial processing of Medicaid or SCHIP applications or to make eligibility determinations. Please refer to the interim rule for a detailed discussion.

Persons directly connected with the administration or enforcement of Federal and State education programs and several of the other programs authorized access to children's eligibility information under Public Law 103-448 are not as clearly defined. Also, whereas Public Law 106-224 had mandated that children's free and reduced price meal information must be used specifically to identify and enroll eligible children in Medicaid or SCHIP, Public Law 103-448 did not include a clear directive that the information must be used for a specific purpose. The Department has specified the information must be used for a legitimate program purpose of the receiving program.

In 2002 and 2003, joint memoranda were issued by the Department of Education and the Department of Agriculture (USDA) regarding the use of free and reduced price meal eligibility in implementing the No Child Left Behind provisions. The memorandum, Guidance on Implementing the No Child Left Behind Act (NCLB), December 17, 2002, can be found on the USDA Food and Nutrition Service Web site at http://www.fns.usda.gov/cnd/lunch/ and then click on “Policy.” A follow-up memorandum on implementing NCLB in Provision 2 and 3 schools was later issued on February 20, 2003. However, there remains some confusion regarding the Department of Education's requirements under the No Child Left Behind Act of 2001 (NCLB) and the relationship to children's free and reduced price eligibility information. (NCLB reauthorized Title I, Part A of the Elementary and Secondary Education Act.)

Title I, Part A, as amended by NCLB, requires schools to disaggregate information about children, such as by limited English proficiency, gender, socio-economic status, etc. Certain educational services, such as priority in school choice and remedial programs, are required under NCLB to be provided to disadvantaged students.

Schools tend to use certification for free and reduced price school meals to determine that children are economically disadvantaged. The question has arisen whether each teacher in a school, because they are providing educational services under NCLB, is considered directly connected to NCLB administration, a Federal education program. The disclosure of meal eligibility information must be limited to as few individuals as possible to protect the confidential nature of the information. All teachers in the school do not need to know the names of all children eligible for free and reduced price meals. Rather, most teachers only need to know which children need the additional services. A list of children needing services, without identifying the children as eligible for free or reduced price meals, may be provided to the teachers by someone who was associated with the free and reduced price meal eligibility process, such as a determining official.

Several commenters to the proposed rule requested that the final rule clearly define who are persons directly connected with program administration or enforcement. Additionally several other commenters believe that the need to know criteria are too broad. We acknowledge commenters concerns that often it is difficult to determine who are the persons directly connected with a program and whether they have a legitimate need to know. With that in mind, determining agencies will need to make careful and well informed judgments.

Public Law 108-265 added certain third party contractors as eligible recipients of children's free or reduced price eligibility status only. These contractors must be assisting in contacting households who have not responded to the schools' verification of eligibility efforts. Contracts providing for such assistance services must include confidentiality assurances, binding contractors to follow the provisions of the NSLA and program regulations.

Final rule—The description of persons directly connected to the administration of Medicaid and SCHIP remains as stated in current regulations. The description and how the information may be used are included in §§ 215.13a(h), 225.15(h), 226.23(j) and 245.6(g). For persons directly connected to education and other programs and activities authorized by Public Law 103-448, the proposed rule is adopted in this final rule. These descriptions and how children's eligibility information may be used are included at §§ 215.13a(g), 225.15(g), 226.23(i) and 245.6(f).

9. Agreement/Memorandum of Understanding—Sections 215.13a(g)(7), 225.15(g)(7), 226.23(i)(7), and 245.6(f)(7) currently require determining agencies that choose to disclose children's eligibility information to Medicaid and SCHIP to have an agreement or Memorandum of Understanding (MOU) with the receiving agency. In the case of disclosures to Medicaid or SCHIP, an agreement/MOU is mandated by the NSLA and is, therefore, nondiscretionary. The agreement/MOU would include such provisions as who will receive the information, how the information will be used, how it will be protected from unauthorized uses and third party disclosures, and acknowledgement of the penalties for misuse of the information. The NSLA does not require or address an agreement or MOU between the determining agency and other individuals or agencies to which children's eligibility status or other information is disclosed. However, in the preamble to the proposed rule, we strongly recommended that determining agencies consider using an agreement.

Two commenters advised that an agreement/MOU should be required for all disclosures of confidential information. The Department agrees and expects that the determining agency should have a written record of individuals and programs that are provided children's eligibility status and/or all eligibility information. An agreement/MOU or other type of written record would serve to advise recipients of their responsibilities to maintain the confidential nature of the information, guard against its misuse, and put the recipient on notice of the penalties for misuse of the information. The Department will let determining agencies decide whether a formal or other type of agreement is necessary, such as a list of persons and programs granted access to eligibility information. Except for disclosure to Medicaid and SCHIP, the regulations will continue to recommend, rather than require, that determining agencies use an agreement/MOU when disclosing children's eligibility information to other individuals or agencies.

Final rule—Sections 215.13a(k), 225.15(k), 226.23(m), and 245.6 (j) require that determining agencies have an agreement/MOU for disclosures to Medicaid and SCHIP and recommend that the determining agency and other recipient agencies enter into an agreement/MOU prior to the disclosure of children's free and reduced price eligibility information for other purposes.

10. Penalties—The NSLA specifies a fine of not more than $1000 and imprisonment for up to 1 year for unauthorized disclosures and misuse of children's eligibility information. This provision is nondiscretionary. The provision was included in both the proposed and interim rules.

Final rule—This final rule retains the penalties stated above at §§ 215.13a(l), 225.15(l), 226.23(n) and 245.6(k).

11. Technical Amendments—This rule also makes several technical amendments to correct or remove obsolete references or provisions. Section 210.19(c)(6)(ii) is revised to replace the acronym AFDC (Aid to Families with Dependent Children) with the acronym TANF (Temporary Assistance for Needy Families), the acronym for the program that replaced AFDC, and adding the words “other FDPIR identifier” in §§ 210.19(c)(6)(ii) and 245.2(a-4)(ii) to clarify that in some cases households participating in FDPIR do not have a case number, but instead are issued another type of identifier. Additionally, corrections are made to the definitions “School” in § 215.2 and “Children” in §§ 210.2 and 220.2 to remove incorrect citations or references.

This rule has been determined to be significant and was reviewed by the Office of Management and Budget under Executive Order 12866.

This final rule provides for the statutory limitations under which children's free and reduced price meal or free milk eligibility information may be disclosed, without parental/guardian consent. This final rule provides State agencies and local program operators that administer the Child Nutrition Programs, as well as households which apply for and/or are approved for free and reduced price meals or free milk the specifics on how and when information may be disclosed. This final rule reflects the disclosure provisions of the Healthy Meals for Healthy Americans Act of 1994 as well as the disclosure provisions of the Agricultural Risk Protection Act of 2000. Additionally, in accordance with the mandates of the Child Nutrition and WIC Reauthorization Act of 2004, this final rule will allow certain third party contractors access to children's eligibility status and will allow school officials to communicate with Medicaid and SCHIP officials to verify that children are eligible for free and reduced price school meals or free milk.

Potential benefits from the sharing of meal benefit eligibility data include reducing redundant means testing, increasing the number of needy families being reached by assistance programs, improving targeting of U.S. Department of Education's programs for needy children, and increasing the integrity of certain assistance programs. The disclosure provisions are intended to reduce paperwork for administrators of certain programs that target low-income households and for low-income households who may benefit from those programs by allowing some sharing of household's free and reduced price meal eligibility information.

Potential costs include an additional administrative burden imposed on school food authorities, privacy infringement on some families, and an increase in program costs for programs that acquire meal benefit eligibility data through this rule. These costs are not expected to be significant. Based on the regulatory impact analysis as well as comments received on the proposed rule, the potential benefits of the final rule are expected to outweigh the potential costs.

This final rule has been reviewed with regard to the requirements of the Regulatory Flexibility Act (5 U.S.C. 601-612). Nancy Montanez Johner, Under Secretary for Food, Nutrition and Consumer Services, has certified that this rule will not have a significant economic impact on a substantial number of small entities. While a regulatory impact analysis was conducted to determine the costs and benefits of the rule, the potential costs and benefits are too diverse and too uncertain to be quantified. The parents and guardians of children applying for free or reduced price meal benefits or free milk will be impacted by the disclosure provisions as well as school districts required to maintain confidentiality.

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104-4, establishes a requirement for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Under section 202 of the UMRA, FNS generally prepares a written statement, including a cost-benefit analysis. This is done for proposed and final rules that have “Federal mandates” which may result in expenditures of $100 million or more in any one year by State, local, or tribal governments, in the aggregate, or by the private sector. When this statement is needed for a rule, section 205 of the UMRA generally requires FNS to identify and consider a reasonable number of regulatory alternatives. It must then adopt the least costly, most cost-effective or least burdensome alternative that achieves the objectives of the rule.

This final rule contains no Federal mandates of $100 million or more in any one year (under regulatory provisions of Title II of the UMRA) for State, local, and tribal governments or the private sector. Thus, this final rule is not subject to the requirements of sections 202 and 205 of the UMRA.

The School Breakfast Program, National School Lunch Program, Special Milk Program, the Summer Food Service Program, and the Child and Adult Care Food Program are listed in the Catalog of Federal Domestic Assistance under Nos. 10.553, 10.555, 10.556, 10.559, and 10.558 respectively. These programs are subject to the provisions of Executive Order 12372, which requires intergovernmental consultation with State and local officials (7 CFR Part 3015, Subpart V, and final rule related notice at 48 FR 29115, June 24, 1983).

Executive Order 13132 requires Federal agencies to consider the impact of their regulatory actions on State and local governments. Where such actions have “federalism implications,” agencies are directed to provide a statement for inclusion in the preamble to the regulation describing the agency's considerations in terms of the three categories called for under section (6)(a)(B) of Executive Order 13132:

Prior to drafting this final rule, we received input from State and local agencies at various times. The Child Nutrition Programs (CNP) are State administered, federally funded programs. Food and Nutrition Service headquarters and regional staff have informal and formal discussions with State and local officials on an ongoing basis regarding program implementation and performance. This arrangement allows State and local agencies to provide feedback that forms the basis for any discretionary decisions in this and other CNP rules. The provisions in this rule are primarily non-discretionary in response to Public Law 103-448, Public Law 106-224 and Public Law 108-265. However, we received comments to the proposed and interim rules from State agencies and school food authorities which were taken into consideration in developing this final rule.

State and local agencies are generally concerned about protecting the confidentiality of children's eligibility information. They are also concerned about the paperwork and financial burdens placed on food service to provide eligibility information to Medicaid and SCHIP officials and the numerous Federal and State education and other programs that request the information throughout the year.

The issuance of this regulation is required by amendments made to the Richard B. Russell National School Lunch Act by Public Law 103-448, Public Law 106-224 and Public Law 108-265. Prior to those amendments, program official could only disclose children's eligibility information with parental consent. This rule establishes and codifies the requirements for any disclosure of children's eligibility information.

We believe that we adequately address the issue of State and local flexibility. We clarify (consistent with the requirements of this rule) that the disclosures of children's eligibility information for use other than to determine and verify eligibility for free and reduced price meals or free milk is a State and local decision. Officials are not required to disclose children's eligibility information. When an exchange of information is agreed upon, we encourage State and local agencies to work with the receiving agency officials to make the exchange of eligibility information as streamlined as possible. Additionally, we have issued prototype materials, such as a prototype agreement between program operators and an agency receiving eligibility information and a prototype notification to parents/guardians a school may use to explain to parents that their children's eligibility information may be disclosed. Additionally, we have clarified through guidance that the school food service may require reimbursement for administrative costs of providing free and reduced price eligibility information to other programs.

Federal and State education programs are the most frequent users of children's free and reduced price meal eligibility information. We encourage food service and the education community to work together to minimize the burdens on food service to limit requests for free and reduced price meal eligibility information to the extent possible. In this regard, Department of Education and Food and Nutrition Service officials have issued joint memoranda on the issue of disclosure of children's free and reduced price eligibility information. These memoranda may be viewed at http://www.fns.usda.gov/cnd/lunch/ and then click on “Policy.”

This final rule has been reviewed under Executive Order 12988, Civil Justice Reform. It is intended to have preemptive effect with respect to any State or local laws, regulations or policies which conflict with its provisions or which would impede its full implementation. This rule is not intended to have retroactive effect unless that is specified in the Effective Date section of the preamble of the final rule. Before any judicial challenge to the provisions of this rule or the application of its provisions, all administrative procedures that apply must be followed. The only administrative appeal procedures relevant to this rule are the hearings that FNS must provide for decisions relating to eligibility for free and reduced price meals and free milk (§ 245.7 for the NSLP, SBP, and SMP in schools; § 225.13 for the SFSP, and § 226.23(e)(5) for the CACFP).

FNS has reviewed this final rule in accordance with the Department Regulation 4300-4, “Civil Rights Impact Analysis,” to identify any major civil rights impacts the rule might have on children on the basis of race, color, national origin, sex, age or disability. After a careful review of the rule's intent and provisions, FNS has determined that it does not affect the participation of protected individuals in the Child Nutrition Programs.

The Paperwork Reduction Act of 1995 (44 U.S.C. Chap. 35; see 5 CFR 1320) requires that the Office of Management and Budget (OMB) approve all collections of information by a Federal agency before they can be implemented. Respondents are not required to respond to any collection of information unless it displays a current valid OMB control number. Information collections in this final rule have been approved by OMB under OMB control numbers 0584-0005, 0584-0280, 0584-0055, and 0584-0026.

FNS is committed to compliance with the E-Government Act to promote the use of the Internet and other information technologies to provide increased opportunities for citizen access to Government information and services and for other purposes.

The regulations in “Subpart-Fruits and Vegetables” (7 CFR 319.56 through 319.56-8, referred to below as the regulations) prohibit or restrict the importation of fruits and vegetables into the United States from certain parts of the world to prevent the introduction and dissemination of plant pests that are new to or not widely distributed within the United States.

On November 17, 2006, we published in the Federal Register (71 FR 66881-66888, Docket No. APHIS-2006-0121) a proposal  1 to allow the importation into the continental United States of mangoes from India under certain conditions. As a condition of entry, we proposed that the mangoes would have to be treated with a minimum absorbed dose of 400 gray of irradiation and be accompanied by a phytosanitary certificate certifying that the fruit received the required irradiation treatment. In addition, because the required irradiation treatment would not mitigate the risks posed by the fungi Cytosphaera mangiferae and Macrophoma mangiferae or the bacterium Xanthomonas campestris pv. mangiferaeindicae, which we consider to be of medium risk of introduction and dissemination within the continental United States, we proposed additional safeguarding measures. For the two fungi; we proposed three options: (1) The mangoes be treated with a broad-spectrum post-harvest fungicidal dip, (2) the orchard of origin be inspected at a time prior to the beginning of harvest as determined by the mutual agreement between the Animal and Plant Health Inspection Service (APHIS) and the national plant protection organization (NPPO) of India and be found free of Cytosphaera mangiferae and Macrophoma mangiferae, or (3) the orchard of origin be treated with a broad-spectrum fungicidal application during the growing season, be inspected at a time prior to the beginning of harvest as determined by the mutual agreement between APHIS and the NPPO of India, and the fruit found free of Cytosphaera mangiferae and Macrophoma mangiferae. For the bacterium X. campestris pv. mangiferaeindicae, we proposed that the shipment be inspected during preclearance activities and found free of X. campestris pv. mangiferaeindicae. The required phytosanitary certificate would have to confirm that one of the three measures described above for the fungi and the inspection for the bacterium had been carried out.

We solicited comments concerning our proposal for 60 days, ending January 16, 2007. We received three comments by that date. The first comment was from a private citizen who requested that American businesses be allowed to import fruit from wherever they like without being subject to regulations. Such an approach would present an unacceptable level of risk. As The Plant Protection Act (PPA, 7 U.S.C. 7701 et seq. ) states, the unregulated movement of plant pests, noxious weeds, plants, certain biological control organisms, plant products, and articles capable of harboring plant pests or noxious weeds could present an unacceptable risk of introducing or spreading plant pests or noxious weeds, which is contrary to APHIS' mission to protect American agriculture. Therefore, the PPA authorizes the Secretary of Agriculture to prohibit or restrict the importation, entry, exportation, or movement in interstate commerce of any plant, plant product, biological control organism, noxious weed, article, or means of conveyance if the Secretary determines that the prohibition or restriction is necessary to prevent the introduction of a plant pest or noxious weed into the United States or the dissemination of a plant pest or noxious weed within the United States. The Secretary of Agriculture has delegated this authority to APHIS.

The second comment was from an industry group that offered a correction to the statement in the proposed rule that India contains only one irradiation facility. The commenter stated that there are multiple food irradiation facilities in India, although the commenter did not know of the APHIS certification status of these additional facilities. To our knowledge, India is currently making the necessary adjustments to only one facility to meet the requirements outlined in 7 CFR part 305. Additional irradiation facilities can be evaluated for APHIS certification, if requested by the Government of India.

The third comment was from a representative of the NPPO of India. The commenter asked that APHIS work with the NPPO of India to reduce the cost of the trust fund required by the regulations to pay for the cost of preclearance activities. APHIS acknowledges, and has considered, India's concerns about the cost of the preclearance program and we will work with the NPPO to explore ways to minimize costs.

The commenter also asked that APHIS recognize a secondary government agency, The Agricultural and Processed Food Products Export Development Authority, working on behalf of the NPPO of India to implement the requirement for the registration of packinghouses and orchards within India. This request is consistent with the terms of the operational workplan, which allows the NPPO of an importing country or its designee to conduct inspections, registration, etc.

The commenter also requested that APHIS forward guidelines for the labeling of mango shipments from other countries to the NPPO of India in order to develop its own guidelines. Due to the irradiation requirement for mangoes from India, labeling requirements for shipments of Indian mangoes will be different than mangoes imported from other countries. The use of irradiation on Indian mangoes also means that, in addition to APHIS labeling requirements, Indian mangoes must also meet Food and Drug Administration labeling requirements. Requirements for the labeling of shipments of mangoes from India will be provided in the operational workplan.

The commenter also suggested limiting the additional declarations on the phytosanitary certificate to a statement regarding the broad spectrum fungicidal dip and pest freedom of shipments. The commenter stated that the additional declarations in the proposed rule were needless due to preclearance activities already requiring pre-export inspection by APHIS. Additional declarations are common on phytosanitary certificates for fruit and vegetable imports and serve to alert APHIS inspectors at the port of entry to specific pests of concern or specific operational procedures that were required to be met before import. While we do not agree with the statement that the additional declarations are needless, we agree that the text of the requirement could be simplified. Therefore, in this final rule, paragraph (e) of § 319.56-2tt requires, with respect to the additional declaration, that the NPPO confirm that (1) The mangoes were subjected to one of the pre- or post-harvest mitigation options described in § 319.56-2tt(b) and (2) the mangoes were inspected during preclearance activities and found free of Cytosphaera mangiferae, Macrophoma mangiferae, and Xanthomonas campestris pv. mangiferaeindicae.

The commenter indicated that producers in India may wish to export mango varieties other than, or in addition to, the three varieties mentioned in the proposed rule. We mentioned specific varieties in the proposed rule's economic analysis, but the regulatory text of the proposed rule and this final rule contains no limitations on the varieties of mangoes that will be eligible for importation into the continental United States from India.

The economic analysis in the proposed rule stated that the mango harvest season in India usually begins in April or May and lasts about 2 months. The commenter stated that the harvest season stretches from March to July. The economic analysis in this final rule has been updated to reflect the timeframe provided by the commenter. That change does not affect the conclusions of our analysis.

Finally, the commenter stated that the wrapping of pallet-loads of cartons with polyethylene prior to leaving the treatment facility will not be practical for shipments to the United States because the final palletization of air shipments would be conducted at the airport. As an alternative, the commenter suggested the use of individual, pest-proof boxes with less than 1.6 mm netting to protect against pests entering the boxes through ventilation holes. The regulations in § 305.31(g)(3)(i)(A) provide for the use of the individual pest-proof boxes suggested by the commenter as a means of protecting treated fruit from reinfestation. However, the wrapping or strapping of pallet-loads of cartons referred to by the commenter is required under regulations in § 305.31(g)(3)(ii) in order to preserve the identity of treated lots, which is something that the commenter's suggestion does not address. We are willing to work with the Indian NPPO to explore alternative ways to preserve the identity of treated lots in accordance with the applicable regulations.

Therefore, for the reasons given in the proposed rule and in this document, we are adopting the proposed rule as a final rule, with the changes discussed in this document.

This is a substantive rule that relieves restrictions and, pursuant to the provisions of 5 U.S.C. 553, may be made effective less than 30 days after publication in the Federal Register . Immediate implementation of this rule is necessary to provide relief to those persons who are adversely affected by restrictions we no longer find warranted. The harvest season for mangoes from India begins in March. Making this rule effective immediately will allow interested producers and others in the marketing chain to benefit during this year's shipping season. Therefore, the Administrator of the Animal and Plant Health Inspection Service has determined that this rule should be effective upon publication in the Federal Register .

This rule has been reviewed under Executive Order 12866. The rule has been determined to be not significant for the purposes of Executive Order 12866 and, therefore, has not been reviewed by the Office of Management and Budget.

We are amending the fruits and vegetables regulations to allow the importation into the continental United States of mangoes from India under certain conditions. As a condition of entry, the mangoes must undergo irradiation treatment and be accompanied by a phytosanitary certificate with additional declarations providing specific information regarding the treatment and inspection of the mangoes and the orchards in which they were grown. In addition, the mangoes will be subject to inspection at the port of first arrival. This action allows for the importation of mangoes from India into the continental United States while continuing to provide protection against the introduction of quarantine pests.

Production of mangoes in the United States is limited to three States: Florida, California, and Hawaii. Due to climatic conditions and expanding urbanization in areas of production, mango-producing acreage is small and production minimal. We rely heavily on imports of fresh mangoes in order to meet consumer demand. The majority of mangoes produced in Florida, California, and Hawaii are destined for local markets, with very limited larger-scale commercial production. The Small Business Administration's (SBA) size standard for mango farming is $750,000 or less in annual receipts. 2 According to the 2002 Census of Agriculture, there were a total of 623 farms (400 in Florida, 11 in California, and 212 in Hawaii) engaged in mango production. Census data did not include annual sale valuation statistics for mango-producing farms. The exact number of mango farms that would be considered small by SBA standards is unknown. However, based on the small bearing acreage, production principally for local markets, and our dependence on imports to meet domestic demand for mangoes, we would expect the majority of these operations to be classified as small. Below we examine recent production in the three mango-producing States, followed by a discussion of foreign supply.

Over 80 percent of mango acreage in Florida is located in Miami-Dade County, and the remaining acreage is located in surrounding areas. Mango cultivars commonly grown in Florida, which also make up the majority of varieties currently exported to the United States, are ‘Tommy Atkins,' ‘Keitt,' ‘Haden,' and ‘Kent.' The 2002 Census of Agriculture states that Florida had 400 mango-producing farms with 1,373 acres. 3 By 2003, the most recent year for which statistics are available, the number of acres had dropped to 1,300, a 24 percent decline in 3 years. Recent estimates indicate that the acreage has decreased still further, to a modest 1,000 acres in 2005. 4 Only two new acres of mangoes have been planted in Florida since 2000. In a 1997 production report, the last year these statistics were gathered, a mango crop of 100,000 bushels (5.5 million pounds) was harvested, with a price of $14.50 per bushel, yielding a total value of $1.45 million. 5 Due to declining acreage, and consequently reduced harvest yield, production and value statistics are no longer maintained. The majority of mangoes produced in Florida are destined for local farmers' and specialty markets, or sold as green fruit for processing. We are unaware of any larger-scale commercial shipments of fresh mangoes by Florida producers.

According to the 2002 Census of Agriculture, there were 11 mango-producing farms in California, with an unknown amount of acreage. 6 Until recently, mangoes produced in California were thought to be sold only in local markets. However, recent news reports indicate that there are two commercial mango operations in the Coachella Valley of California that sell their fruit through the Corona College Heights Orange & Lemon Association in Corona, CA. 7 According to the article, the two operations have a combined total of 210 bearing acres, yielding about 275,000 cartons of mangoes (approximately 3.8 million pounds), with a little less than half being certified organic. 8 In addition, one of the growers expects to have an additional 48 acres bearing fruit in 2007. Commercial mango production in California is a relatively new venture, and is expected to grow only gradually. As the article points out, the availability of suitable land for mangoes is limited due to the fruits' susceptibility to frost. For those areas that are not prone to frost, producers are reluctant to switch to mango production from profitable crops such as grapes and citrus because of the heavy initial investments and the long period between first investment and return. The time period between first planting and first production is 5 years for mango trees, so it is not surprising that producers are reluctant to enter into this industry.

In 2002, the Census of Agriculture recorded 212 mango-producing farms in Hawaii, but withheld production acreage to avoid disclosing information for individual operations. In 2004, the Hawaiian field office of the National Agricultural Statistics Service (NASS) reported there were 140 farms, with a total of 275 acres of crops, of which 200 acres yielded utilized production of 380,000 pounds, with a sales value of $350,000. Preliminary reports for 2005 indicate a decrease of 28.5 percent in the number of mango farms to 100, but an increase in total crop acreage to 295. The amount of harvested acres in 2005 was 190, which represents a slight decrease. However, there was a 39.4 percent increase in utilized production, which, combined with a higher farm price per pound, yielded a 40.2 percent increase in total sales value to $586,000. 9 The amount of commercial production of mangoes in Hawaii is unknown at this time; however, we believe the majority of production is funneled into local markets.

As is evident, U.S. mango production is limited, with most of the fruit sold locally. In fact, official supply and utilization data maintained by USDA's Economic Research Service (ERS) have not recorded domestic production figures since 1998. U.S. consumers are almost entirely dependent on imports to meet domestic demand. Table 1 presents ERS data on the supply and utilization of fresh mangoes, 2002-2005. 10

The Office of Management and Budget (OMB) has determined that this rule is non-significant for the purposes of Executive Order 12866 and, therefore, it has not been reviewed by OMB.

Pursuant to the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 35), the collections of information in this rule have been approved by OMB under control number 0563-0053 through November 30, 2007.

FCIC is committed to compliance with the GPEA, which requires Government agencies, in general, to provide the public with the option of submitting information or transacting business electronically to the maximum extent possible. FCIC requires that all reinsured companies be in compliance with the Freedom to E-File Act and section 508 of the Rehabilitation Act.

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. This rule contains no Federal mandates (under the regulatory provisions of title II of the UMRA) for State, local, and tribal governments or the private sector. Therefore, this rule is not subject to the requirements of sections 202 and 205 of UMRA.

It has been determined under section 1(a) of Executive Order 13132, Federalism, that this rule does not have sufficient implications to warrant consultation with the States. The provisions contained in this rule will not have a substantial direct effect on States, or on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

FCIC certifies that this regulation will not have a significant economic impact on a substantial number of small entities. Written agreement requirements for the Federal crop insurance program are the same for all producers regardless of the size of their operations. For instance, all producers requesting this type of written agreement must submit actual yields for at least the most recent three crop years in which the crop was planted during the base period. Any producer who did not produce the crop for at least three years, for which the written agreement is requested, must submit actual yields for a similar crop, or a combination of actual yields for the crop and a similar crop in the county for which the written agreement is being requested. Whether a producer has 10 acres or 100 acres there is no difference in the kind of information required for requesting a written agreement. To ensure crop insurance is available to small entities, the Federal Crop Insurance Act authorizes FCIC to waive collection of administrative fees from limited resource farmers. FCIC believes this change helps ensure that small entities are given the same opportunities as large entities to manage their risks through the use of crop insurance. A Regulatory Flexibility Analysis has not been prepared since this regulation does not have an impact on small entities, and, therefore, this regulation is exempt from the provisions of the Regulatory Flexibility Act (5 U.S.C. 605).

This program is listed in the Catalog of Federal Domestic Assistance under No. 10.450.

This program is not subject to the provisions of Executive Order 12372, which require intergovernmental consultation with State and local officials. See the Notice related to 7 CFR part 3015, subpart V, published at 48 FR 29115, June 24, 1983.

This proposed rule has been reviewed in accordance with Executive Order 12988 on civil justice reform. The provisions of this rule will not have a retroactive effect. The provisions of this rule will preempt State and local laws to the extent such State and local laws are inconsistent herewith. With respect to any direct action taken by FCIC or to require the insurance provider to take specific action under the terms of the crop insurance policy, the administrative appeal provisions published at 7 CFR part 11 must be exhausted before any action against FCIC for judicial review may be brought.

This action is not expected to have a significant economic impact on the quality of the human environment, health, or safety. Therefore, neither an Environmental Assessment nor an Environmental Impact Statement is needed.

On Tuesday, March 21, 2006, FCIC published a notice of proposed rulemaking in the Federal Register at 71 FR 6016-6021 to amend 7 CFR 457.122 Walnut crop insurance provisions and 7 CFR 457.123 Almond crop insurance provisions effective for the 2008 and succeeding crop years.

The public was afforded 60 days to submit written comments and opinions. The commenters were an insurance services organization and an insurance provider. The comments received and FCIC's response is as follows:

Comment: Two commenters recommended changing the language in section 6(d) of the Walnut Crop Provisions and section 6(e) of the Almond Crop Provisions from “unless otherwise provided in the Special Provisions or by written agreement” to read; “unless otherwise provided in the Special Provisions or we agree in writing”.

The commenters concerns with issuing written agreements to insure production from underage trees would require approved insurance providers to submit all policies to the Regional Office for written agreement consideration. Currently, insureds have the ability to insure production from underage almond and walnut trees at all coverage levels by “we agree in writing” under the current Crop Provisions.

The commenters state that approved insurance providers would be faced with a difficult and costly task to abide by all documentation requirements for written agreement submissions within the standard 15 business days after the sales closing date and thus result in the insured potentially not getting insurance coverage timely. As a result, the use of the written agreements as a means to provide coverage for production from underage almond and walnut trees would be burdensome to the producer.

The commenters also state that producers now have the ability to insure production from underage almond and walnut trees at the catastrophic risk protection (CAT) level. They claim the current proposal would make CAT policies ineligible for this insurance coverage under the written agreement criteria, since written agreements are not available under CAT coverage.

The commenters state that the use of “we agree in writing” language allows the approved insurance providers and RO's to efficiently process the request to insure production from underage almond and walnut trees. Any deviation from this process would be resisted by the AIPs, Regional Office, agents and insureds.

Response: FCIC realized that the proposed language would have needlessly imposed a heavy burden on producers, agents, AIPs and ROs. However, the preamble of the policy only allows deviation from the policy terms if allowed by written agreement. Therefore, use of the term “agree in writing” is not a viable solution. Instead, FCIC has amended the language to state coverage on production from under-aged trees is allowed if provided for in the Special Provisions. This change will provide insurance coverage for production from under-aged trees without the need to have a written agreement. This will also allow coverage to be available at all buy-up coverage levels and at the CAT level of coverage.

On July 24, 2006, we issued a proposal to amend part 39 of the Federal Aviation Regulations (14 CFR part 39) to include an AD that would apply to all RAC Beech Models 45 (YT-34), A45 (T-34A, B45), and D45 (T-34B) airplanes. That proposal was published in the Federal Register as a notice of proposed rulemaking (NPRM) on July 31, 2006 (71 FR 43075). The NPRM proposed to supersede AD 62-24-01 with a new AD that would retain the actions required in AD 62-24-01 and only change the inspection procedure from the dye penetrant method to the surface eddy current method.

We provided the public the opportunity to participate in developing this AD. The following presents the comments received on the proposal and FAA's response to each comment:

Larry Bierma, Joe Enzminger, John Aldous, Michael Vadeboncoeur, John Rippinger, William E. Mayher, Dan Thomas, and Victor Barrett state that the inspection compliance in the proposed AD is a duplication of the inspection for those who have done the eddy current inspection recently as part of compliance with an alternative method of compliance (AMOC) to AD 2004-25-51.

The commenters state that requiring another eddy current inspection within 6 months after the effective date of this AD would be unnecessary and economically burdensome for those who have already done it. The commenters request credit for the last inspection done in compliance with an AMOC to AD 2004-25-51 as compliance for the initial inspection required in the proposed AD.

We have rewritten the compliance time to give full credit for previously accomplished eddy current inspections done in the area affected by this AD.

Michael Vadeboncoeur, John Aldous, Mike Talbot, Eric Evans, Earle Parks, Floyd Stilwell, Dan Thomas, Stephen Baksa, William Beitler, and Terrance Brennan state that, since the time AD 62-24-01 was issued, there have not been any accidents as a result of cracks in the horizontal stabilizer. The commenters request the proposed AD be withdrawn.

The commenters also request that stabilizer spars modified by Parks Industries supplemental type certificate (STC) either be exempt from the inspections or the inspection interval be increased to 1,000 hours TIS.

We do not agree with the commenters. In 2005, 148 of the affected airplanes were eddy current inspected. Cracks in the stabilizer spars and/or spar webs were found on 6 of these airplanes, which required the spars to be replaced. If no eddy current inspections had been done, those cracks may have grown and reached critical crack lengths, which could have compromised the integrity of the spar structure.

In order to increase the inspection interval or eliminate the spar inspections, we need supporting engineering analysis data regarding fatigue life, crack growth rate, etc. We have not received such data for the spars modified by the Parks Industries STC.

If we receive engineering analysis data that supports increasing the inspection intervals or eliminating the inspections, we may take additional rulemaking action at that time.

We are not changing the final rule AD action based on these comments.

Floyd Stilwell, Earle Parks, and Terrance Brennan state that the surface eddy current inspection is expensive and inconvenient. Qualified technicians to do the surface eddy current inspections have to be brought to the repair station from other parts of the country, which contributes to the expense of doing the eddy current inspection. The commenters request retaining the dye penetrant inspection.

We do not agree with the commenters. AD 2001-13-18 R1 currently requires owners/operators of all Beech Models 45 (YT-34), A45 (T-34A, B-45), and D45 (T-34B) airplanes to do repetitive 80-hour TIS eddy current inspections of the wing spar assemblies and other components following Raytheon Aircraft Mandatory Service Bulletin No. SB 57-3329, Part II, Page 3/65, Issued: February, 2000. If the wing spar and stabilizer spar inspections are properly planned, these two inspections could be done at the same time. This planning would eliminate any extra expenses.

We have reason to believe that damage tolerance analysis of the stabilizer spar is being conducted by some owners. This may result in additional rulemaking action that could eliminate the inspection or increase the inspection interval. Until that time, AMOCs for this AD may be approved, if requested using the procedures found in 14 CFR 39.19.

We are not changing the final rule AD action based on these comments.

Dan Thomas, William Beitler, Floyd Stilwell, William Mayher, and Mike Talbot state that the eddy current inspection method is no better than the dye penetrant method for detecting cracks. The level of safety will not be enhanced by changing the inspection methods. Further, the eddy current method could produce false positives and the frequent inspections could also incur damage to the stabilizer spar. The commenters request the method of inspection be at the owner's/operator's option.

We do not agree with the commenters. The eddy current inspection method is a more sensitive inspection process. The dye penetrant inspection method at times could completely miss detecting the cracks.

All inspection methods have some inherent drawbacks. Eddy current inspection methods detect small surface cracks better than dye penetrant methods, and eddy current inspection methods are also capable of detecting subsurface cracks. Detection of cracks early is a definite advantage. Eddy current inspection methods could occasionally produce false positives; however, this could be avoided if cracks are confirmed by repeatable flaw indications.

If the inspections required by this AD are carefully done by qualified technicians, any damage to the spars could be prevented.

The 500-hour TIS repetitive inspection interval is a long interval between inspections for this type of airplane, which normally will take place once in 5 years or longer in most cases; therefore, we do not consider this inspection requirement as frequent.

We are not changing the final rule AD action based on this comment.

We have carefully reviewed the available data and determined that air safety and the public interest require adopting the AD as proposed except for minor editorial corrections. We have determined that these minor corrections:

• Are consistent with the intent that was proposed in the NPRM for correcting the unsafe condition; and

• Do not add any additional burden upon the public than was already proposed in the NPRM.

We estimate that this AD affects 475 airplanes in the U.S. registry.

We estimate the following costs to accomplish each inspection:

We estimate the following costs to do any necessary horizontal stabilizer replacements that will be required based on the results of the inspection. We have no way of determining the number of airplanes that may need this replacement:

The only difference between this AD and AD 62-24-01 is the change of inspection method. There may be some minimal additional cost involved in doing the eddy current inspection because of possible equipment rentals necessary. No additional actions are being required. We have determined that this AD action does not increase the cost impact over that already required by AD 62-24-01.

Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority.

We are issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701, “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this AD.

We have determined that this AD will not have federalism implications under Executive Order 13132. This AD will not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

For the reasons discussed above, I certify that this AD:

1. Is not a “significant regulatory action” under Executive Order 12866;

2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and

3. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

We prepared a summary of the costs to comply with this AD (and other information as included in the Regulatory Evaluation) and placed it in the AD Docket. You may get a copy of this summary by sending a request to us at the address listed under ADDRESSES. Include “Docket No. FAA-2006-25105; Directorate Identifier 2006-CE-33-AD” in your request.

The FAA proposed to amend 14 CFR part 39 with a proposed AD. The proposed AD applies to TCM GTSIO-520 series reciprocating engines. We published the proposed AD in the Federal Register on October 26, 2006, (71 FR 62570). That action proposed to require performing the inspection ordered in paragraph (h) of AD 2005-20-04 every 100 hours time-in-service (TIS), or annually to correct an error that required the inspection at every 100-hour inspection.

You may examine the docket that contains the AD, any comments received, and any final disposition in person at the Docket Management Facility Docket Office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone (800) 647-5227) is located on the plaza level of the Department of Transportation Nassif Building at the street address stated in ADDRESSES . Comments will be available in the AD docket shortly after the DMS receives them.

We provided the public the opportunity to participate in the development of this AD. We have considered the comment[s] received.

Two commenters propose dropping the placard from the requirements of the proposed AD. The commenters do not believe the placard is necessary. We agree. It appears the commenters are basing their comment on the original notice of proposed rulemaking (NPRM) that we issued on April 6, 2005, not the current NPRM. We received comments to the original NPRM similar to these comments and removed the requirement to add a placard before we issued AD 2005-20-05. We didn't change this AD.

The same two commenters request we mandate a more detailed inspection for the components. The commenters state that a visual inspection might not be sufficient. We don't agree. The commenters didn't specify any additional inspections. We consider a visual inspection the best method to detect abnormal surface wear. We don't have any requirement for nondestructive testing because we have no indication of subsurface deterioration. We didn't change the AD.

One commenter asks us to perform additional economic assessment. The commenter states we didn't consider the economic effects on other small entities. We don't agree. We used our current procedures to consider the economic effects of this action. We didn't change the AD.

We changed paragraph (f) of this AD from “If, during an inspection * * * crankcase, replace it with a serviceable bushing before reassembling components” to “(f) If, during an inspection required by paragraph (g), (h), (i), or (j) of this AD, you find needle bearing, part number (P/N) 537721, installed in the crankcase, replace it with a serviceable bushing, P/N 654472 or equivalent FAA approved bearing, before reassembling components” to clarify the intent of that requirement.

We also added paragraph (h)(3) to make the compliance times in that requirement consistent with paragraph (i)(3).

We have carefully reviewed the available data, including the comments received, and determined that air safety and the public interest require adopting the AD with the changes described previously. We have determined that these changes will neither increase the economic burden on any operator nor increase the scope of the AD.

We estimate that this AD will affect 4,240 engines installed on airplanes of U.S. registry. We also estimate that it will take about one work-hour per engine to perform the inspection, about one work-hour per engine to perform the proposed bushing installation and about six work-hours per engine to install the TCM service kit. The average labor rate is $80 per work-hour. We estimate that about 25 percent of the engines will require an unscheduled (rough-running engine) inspection and about half of the engines will require the bushing and TCM service kit. Required bushings would cost about $16 per engine and service kits about $800 per engine. Based on these figures, we estimate the total cost of the AD to U.S. operators to be $6,393,432.

Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, Section 106, describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the Agency's authority.

We are issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701, “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.

We have determined that this AD will not have federalism implications under Executive Order 13132. This AD will not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

For the reasons discussed above, I certify that this AD:

(1) Is not a “significant regulatory action” under Executive Order 12866;

(2) Is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and

(3) Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

We prepared a summary of the costs to comply with this AD and placed it in the AD Docket. You may get a copy of this summary at the address listed under ADDRESSES .

The FAA is implementing a new process for streamlining the issuance of ADs related to MCAI. This streamlined process will allow us to adopt MCAI safety requirements in a more efficient manner and will reduce safety risks to the public. This process continues to follow all FAA AD issuance processes to meet legal, economic, Administrative Procedure Act, and Federal Register requirements. We also continue to meet our technical decision-making responsibilities to identify and correct unsafe conditions on U.S.-certificated products.

This AD references the MCAI and related service information that we considered in forming the engineering basis to correct the unsafe condition. The AD contains text copied from the MCAI and for this reason might not follow our plain language principles.

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 to include an AD that would apply to the specified products. That NPRM was published in the Federal Register on December 18, 2006 (71 FR 75684). That NPRM proposed to correct an unsafe condition for the specified products. The MCAI states that:

We gave the public the opportunity to participate in developing this AD. We received no comments on the NPRM or on the determination of the cost to the public.

We reviewed the available data and determined that air safety and the public interest require adopting the AD as proposed.

We have reviewed the MCAI and related service information and, in general, agree with their substance. But we might have found it necessary to use different words from those in the MCAI to ensure the AD is clear for U.S. operators and is enforceable. In making these changes, we do not intend to differ substantively from the information provided in the MCAI and related service information.

We might also have required different actions in this AD from those in the MCAI in order to follow our FAA policies. Any such differences are described in a separate paragraph of the AD, and take precedence over the actions copied from the MCAI.

Based on the service information, we estimate that this AD will affect about 3 products of U.S. registry. We also estimate that it will take about 10 work-hours per product to comply with this AD. The average labor rate is $80 per work-hour. Required parts will cost about $1,000 per product. Where the service information lists required parts costs that are covered under warranty, we have assumed that there will be no charge for these costs. As we do not control warranty coverage for affected parties, some parties may incur costs higher than estimated here. Based on these figures, we estimate the cost of the AD on U.S. operators to be $5,400 or $1,800 per product.

Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. “Subtitle VII: Aviation Programs,” describes in more detail the scope of the Agency's authority.

We are issuing this rulemaking under the authority described in “Subtitle VII, Part A, Subpart III, Section 44701: General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.

We determined that this AD will not have federalism implications under Executive Order 13132. This AD will not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

For the reasons discussed above, I certify this AD:

1. Is not a “significant regulatory action” under Executive Order 12866;

2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and

3. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

We prepared a regulatory evaluation of the estimated costs to comply with this AD and placed it in the AD docket.

You may examine the AD docket on the Internet at http://dms.dot.gov; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains the NPRM, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (telephone (800) 647-5227) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

HRSA oversees transplantation of organs through the Organ Procurement and Transplantation Network (OPTN), which sets policies related to the procurement, transplantation, and allocation of human organs (see 42 CFR part 121). FDA currently regulates blood vessels. However, FDA does not regulate vascularized human organs (see 21 CFR 1270.3(j)(4) and 1271.3(d)(1)). FDA's jurisdiction over blood vessels intended for use in organ transplantation overlaps with HRSA's oversight of the OPTN.

There is a routine practice of recovering blood vessels intended for use in organ transplantation during organ procurement and using such blood vessels to connect donor organ and recipient vessels. Blood vessels intended for use in organ transplantation are recovered with human organs by Organ Procurement Organizations (OPOs) and stored for use at transplant centers. Both OPOs and transplant centers are already subject to HRSA oversight because of their organ procurement and transplantation activities. The application of both HRSA and FDA regulatory requirements to these facilities in relation to organs and blood vessels procured for use in organ transplantation is not supported by a need for such dual oversight. In order to avoid the duplication of efforts and reduce the burden on affected facilities, this final rule transfers from FDA to HRSA jurisdiction over blood vessels intended and labeled for use in organ transplantation. This final rule does not affect the regulation of blood vessels intended for transplantation that do not involve organ transplantation. Jurisdiction over such blood vessels remains with FDA.

Under this final rule, blood vessels labeled and intended solely for use in organ transplantation will be subject to HRSA requirements in 42 CFR part 121 and any enforceable OPTN policies established under 42 CFR part 121. To be regulated under HRSA requirements, such blood vessels intended for use in organ transplantation must be labeled “For use in organ transplantation only.” However, they are not required to be attached to the organ(s), transplanted simultaneously with such organ(s) to the same recipient, or transplanted with the organ(s) from the same donor. For example, occasionally blood vessels not used immediately for the transplantation of a donated organ are stored for a number of days and subsequently used to modify the organ transplant in the same recipient or to accomplish transplantation in the recipient of an organ from a different donor. Such blood vessels intended and labeled for use in organ transplantation may be used in these ways when the use is consistent with HRSA requirements.

In the Federal Register of May 12, 2006, we published a direct final rule and a companion proposed rule (71 FR 27606 and 27649, respectively) to revise HRSA's definition of “organ” to include blood vessels recovered from an organ donor during the same recovery procedure of such organ(s) and intended and labeled for use in organ transplantation; and to exclude such blood vessels from FDA's definition of human cells, tissues, or cellular or tissue-based products (HCT/Ps) (21 CFR 1271.3(d)). The direct final rule amended the regulations so that blood vessels intended and labeled for use in organ transplantation were under the same regulatory scheme as organs, thereby making blood vessels intended and labeled for use in organ transplantation readily available to meet organ transplant needs. Such direct final rule would become effective unless we received significant adverse comment. We published a companion proposed rule to provide a procedural framework within which the rule could be finalized in the event we received any significant adverse comments regarding the direct final rule, and the direct final rule had to be withdrawn.

We received comments from health care professionals and a nonprofit organization. Among the comments received, one comment fully supported the rulemaking. Another comment concerned the use and tracking of blood vessels recovered from a deceased organ donor but not transplanted with the recovered organ, and questioned the transfer of regulatory responsibility for such blood vessels from FDA to HRSA. Another comment suggested that the rulemaking distinguish between organ transplant recipients based on the type of their organ donor (living, nonrelated; living, related; or deceased) and use these distinctions to define who may receive the blood vessels addressed in the rulemaking. The comments received and our responses to the comments are discussed in section IV of this document. Because we received significant adverse comment in response to the rulemaking, we published a notice in the Federal Register of September 14, 2006 (71 FR 54198), withdrawing the direct final rule.

To transfer from FDA to HRSA jurisdiction over blood vessels intended for use in organ transplantation, the final rule amends 21 CFR 1271.3(d), 42 CFR 121.2, and 42 CFR 121.7 as follows:

21 CFR 1271.3(d) defines HCT/Ps as “articles containing or consisting of human cells or tissues that are intended for implantation, transplantation, infusion, or transfer into a human recipient.” In the definition, we also exclude certain articles from the definition of HCT/Ps. This final rule adds § 1271.3(d)(8), excluding from the definition of HCT/Ps blood vessels intended for use in organ transplantation. The rule excludes such blood vessels intended for use in organ transplantation only when they are labeled as “For use in organ transplantation only,” to distinguish such vessels from blood vessels not intended for use in organ transplantation. By labeling such blood vessels “For use in organ transplantation only,” we expect that they will not be used for other purposes. Under the final rule, blood vessels intended for other uses remain subject to 21 CFR part 1271.

Under 42 CFR 121.2, “Organ” means a human kidney, liver, heart, lung, or pancreas. This final rule adds to that definition “Blood vessels recovered from an organ donor during the recovery of such organ(s) are considered part of an organ with which they are procured for purposes of this Part if the vessels are intended for use in organ transplantation and labeled ‘For use in organ transplantation only’.” Blood vessels intended for use in organ transplantation are required to be in compliance with HRSA provisions for donor screening and testing. The labeling provision is required in order for such blood vessels to fall under this regulatory program. Any OPTN labeling policies, whether voluntary or enforceable, supplement this requirement.

In 42 CFR 121.7, we are redesignating paragraph (e) as paragraph (f), and adding a new paragraph (e). Under 42 CFR 121.7(e), a blood vessel intended for use in organ transplantation is subject to the allocation requirements under 42 CFR part 121 and enforceable OPTN policies pertaining to the organ with which the blood vessel is procured. These provisions apply until the transplant center receiving the organ determines that the blood vessel is not needed for the transplantation of that organ. This allocation priority assures that vessels that may be necessary for the immediate transplantation of the organs with which they are recovered are made available for that use prior to being diverted to other organ transplant uses.

(Comment 1) One comment supported the proposed rule. The comment stated that the Organ Procurement and Transplantation Network/United Network for Organ Sharing (OPTN/UNOS) Board of Directors has approved a policy to provide guidance for the recovery, use, and storage of deceased donor vascular allografts. The comment also stated that the OPTN/UNOS policy does not result in undue burden to the transplant community and is consistent with the provisions of the proposed rule.

(Response) We appreciate the supportive comment. One of our reasons for the proposed rule is to eliminate the burden of dual oversight, by FDA and HRSA, of those blood vessels used in organ transplantation. The policy discussed in the comment is OPTN/UNOS Policy 5.7. 1 OPTN/UNOS Policy 5.7 addresses practices for blood vessel recovery, storage, and transplant by transplant centers and OPOs. The policy will only be implemented once this final rule goes into effect.

(Comment 2) One comment stated that patients would be better protected under the existing regulatory scheme. The comment questioned the safety of transplanting blood vessels recovered from a deceased organ donor into third party recipients who received organs from other donors. The comment explained that use of blood vessels in these recipients poses disease transmission and human leukocyte antigen (HLA) sensitization risks that jeopardize patient safety. The comment also stated that the OPTN and organ transplant programs lack adequate tracking and traceability mechanisms for such blood vessels.

(Response) We acknowledge that the use of blood vessels poses disease transmission and HLA sensitization risks in third party recipients. The intent of this rule is to facilitate the successful completion of life-saving organ transplants in medical procedures where the vasculature of the donated organ is inadequate, or to salvage a graft that would otherwise be lost. It is up to the organ transplant surgeon to assess the risks and benefits of, and alternatives to, using a particular vessel to accomplish or modify an organ transplant. Moreover, the risks of disease transmission and HLA sensitization would apply even if FDA retained jurisdiction over these blood vessels as HCT/Ps. FDA regulations, like HRSA policies, reduce, but cannot entirely eliminate, the risk of disease transmission, and FDA tissue regulations do not address HLA sensitization. In addition, the OPTN has long-established mechanisms for tracking of organs from the donor to the recipient, which require the reporting of transplant outcomes. HRSA intends to monitor the use and outcomes of these vessels used in organ transplantation, and to work with the OPTN to modify policies governing their use as needed.

(Comment 3) One comment suggested that the rulemaking should distinguish between organ recipients based on the type of their organ donor (living, nonrelated; living, related; or deceased) and use these distinctions to define the types of transplant recipients who may receive these vessels for organ transplant use. The comment asked whether a surgeon may use vessels from a deceased donor to repair a thrombosed renal artery in the recipient of a living donor kidney.

(Response) We decline to make these suggested changes to the rulemaking. The language in 42 CFR 121.7(e) establishes a priority allocation for use of vessels with organs from the same donor. If vessels are not needed for this use, the rule does not preclude vessels recovered from deceased donors and labeled “For use in organ transplantation only” from being transplanted into recipients of organs from living donors, either to perform the initial transplant of the organ or to later modify the organ transplant. The situation described in the comment would be an example of the use of such vessels to modify a transplant.

We are issuing these regulations under the authority of the National Organ Transplant Act as amended (NOTA) and section 361 of the Public Health Service Act (the PHS Act). NOTA authorizes HRSA, by delegation from the Secretary, to issue regulations governing the operation of the OPTN. NOTA, as amended, also authorizes the Secretary to define human organs to be covered by the OPTN. Section 374 of the PHS Act specifically states, “[t]he term ‘organ’ means the human kidney, liver, heart, lung, pancreas, and any other human organ (other than corneas and eyes) specified by the Secretary by regulation .* * *.” (42 U.S.C. § 274b(d)(2)) (emphasis supplied). Accordingly, HRSA is issuing this regulation to modify the definition of “organ,” and to make blood vessels labeled and intended for use in the transplantation of organs subject to regulations governing the operation of the OPTN. Extending the definition of organs governed by HRSA in 42 CFR 121.2 to add blood vessels recovered with organs that are intended for use in organ transplantation, and labeled as such, furthers the Secretary's charge under NOTA.

Under the authority of section 361 of the PHS Act delegated to the Commissioner of FDA, the Department of Health and Human Services may make and enforce regulations necessary to prevent the introduction, transmission, or spread of communicable diseases between the States or from foreign countries into the States. This modification of FDA's existing regulation reflects FDA's re-evaluation of the level of regulation that is necessary to prevent disease transmission involving blood vessels intended for use in organ transplantation.

FDA and HRSA have examined the impacts of the final rule under Executive Order 12866 and the Regulatory Flexibility Act (5 U.S.C. 601-612), and the Unfunded Mandates Reform Act of 1995 (Public Law 104-4). Executive Order 12866 directs agencies to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). The agencies believe that this final rule is not a significant regulatory action under the Executive order.

The Regulatory Flexibility Act requires agencies to analyze regulatory options that would minimize any significant impact of a rule on small entities. Because the agencies do not expect that the transfer from FDA to HRSA of jurisdiction over the blood vessels described in the rule will result in substantial changes in the way transplant hospitals and OPOs procure, store, and transplant such blood vessels, FDA and HRSA certify that the final rule will not have a significant economic impact on a substantial number of small entities.

Section 202(a) of the Unfunded Mandates Reform Act of 1995 requires that agencies prepare a written statement, which includes an assessment of anticipated costs and benefits, before proposing “any rule that includes any Federal mandate that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100,000,000 or more (adjusted annually for inflation) in any one year.” The current threshold after adjustment for inflation is $122 million, using the most current (2005) Implicit Price Deflator for the Gross Domestic Product. FDA does not expect this final rule to result in any 1-year expenditure that would meet or exceed this amount.

This final rule contains no collections of information. Therefore, clearance by OMB under the Paperwork Reduction Act of 1995 is not required.

FDA and HRSA have determined under 21 CFR 25.30(j) that this action is of a type that does not individually or cumulatively have a significant effect on the human environment. Therefore, neither an environmental assessment nor an environmental impact statement is required.

FDA and HRSA have analyzed this final rule in accordance with the principles set forth in Executive Order 13132. FDA and HRSA have determined that the rule does not contain policies that have substantial direct effects on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of government. Accordingly, FDA and HRSA have concluded that the rule does not contain policies that have federalism implications as defined in the Executive order and, consequently, a federalism summary impact statement is not required.

This final rule is effective on April 11, 2007.

The Chemical Diversion and Trafficking Act of 1988 (CDTA), (Pub. L. 100-690) created the definition of “chemical mixture” (21 U.S.C. 802(40)), and exempted chemical mixtures from regulatory control. The CDTA established 21 U.S.C. 802(39)(A)(vi), as amended by Title VII of Public Law 109-177, to exclude “any transaction in a chemical mixture” from the definition of a “regulated transaction.” The exemption of all chemical mixtures, however, provided traffickers with an unregulated source for obtaining listed chemicals for use in the illicit manufacture of controlled substances.

To remedy this situation, the Domestic Chemical Diversion Control Act of 1993 (Pub. L. 103-200) (DCDCA), enacted in April 1994, subjected chemical mixtures containing listed chemicals to CSA regulatory requirements, unless specifically exempted by regulation. The DCDCA, therefore, subjected all regulated chemical mixtures to recordkeeping, reporting, and security requirements of the CSA. Additionally, the DCDCA added a registration requirement for handlers of regulated List I chemical mixtures.

The DCDCA, however, also amended 21 U.S.C. 802(39)(A)(vi), as amended by Title VII of Public Law 109-177, to provide the Attorney General with the authority to establish regulations exempting chemical mixtures from the definition of a “regulated transaction” “based on a finding that the mixture is formulated in such a way that it cannot be easily used in the illicit production of a controlled substance and that the listed chemical or chemicals contained in the mixture cannot be readily recovered” (21 U.S.C. 802(39)(A)(vi) as amended by Title VII of Pub. L. 109-177). This authority has been delegated to the Administrator of DEA by 28 CFR 0.100 and redelegated to the Deputy Administrator under 28 CFR Appendix to Subpart R, section 12.

Prior to publication of a final rulemaking, chemical mixtures containing listed chemicals have been treated as exempt from CSA regulatory control. Regulations regarding the exemption of chemical mixtures were initially proposed by DEA on October 13, 1994, as part of its proposed regulations to implement the DCDCA (59 FR 51888). In response to industry concerns, the proposed regulations were withdrawn on December 9, 1994, (59 FR 63738).

DEA proposed new regulations regarding the exemption of chemical mixtures by publishing a new NPRM entitled “Exemption of Chemical Mixtures” on September 16, 1998 (63 FR 49506). DEA proposed the following three-tiered approach to identify which chemical mixtures qualify for automatic exemption: (1) It contains a listed chemical at or below an established concentration limit; or (2) it falls within a specifically defined category; or (3) the manufacturer of the mixture applies for and is granted a specific exemption for the product.

On December 15, 2004, DEA published a final rule which specified criteria used to determine whether chemical mixtures qualify for automatic exemption from CSA chemical regulatory controls for 27 listed chemicals (69 FR 74957; corrected at 70 FR 294, January 4, 2005). Those chemical mixtures that do not meet the exemption criteria are treated as regulated chemicals and therefore, subject to CSA chemical regulatory controls.

Title 21 U.S.C. 802(40) defines the term “chemical mixture” as “a combination of two or more chemical substances, at least one of which is not a List I chemical or a List II chemical, except that such term does not include any combination of a List I chemical or a List II chemical with another chemical that is present solely as an impurity.” Therefore, a chemical mixture contains any number of listed chemicals along with any number of non-listed chemicals. A combination of only listed chemicals is, therefore, not a chemical mixture pursuant to the CSA definition. As such, the regulatory controls pertaining to each individual listed chemical are applicable.

It is DEA's longstanding policy that the combination of a listed chemical in an inert carrier is not considered a chemical mixture. An inert carrier can be any chemical that does not interfere with the listed chemical's function but is present to aid in the delivery of the listed chemical so it can be used in some chemical process. Examples include, but are not limited to, solutions of listed chemicals such as methylamine in water or hydrogen chloride dissolved in water or alcohol. Persons who question if their formulations are chemical mixtures should contact DEA for guidance.

The Final Rule published on December 15, 2004, (69 FR 74957; corrected at 70 FR 294, January 4, 2005) also added, on an interim basis, a new exemption category. DEA determined that certain solvent-based mixtures involving silicon-based products, paint-related materials, and other solvent-based chemical mixtures containing acetone, ethyl ether, 2-butanone, and toluene are not likely to be diverted domestically. These solvent chemicals are mostly a concern because they are used in cocaine and heroin processing, which occurs outside the United States.

Therefore, the December 15, 2004 rulemaking created a new exemption category for these mixtures. Domestic and import transactions in chemical mixtures that are regulated solely due to the presence of the List II solvent chemicals acetone, ethyl ether, 2-butanone, or toluene were removed, on an interim basis, from the definition of a regulated transaction by adding a new paragraph to 21 CFR 1310.08. Methyl isobutyl ketone, also a List II solvent chemical, was not included because domestic and import transactions in that chemical have already been excluded from the definition of a regulated transaction at 21 CFR 1310.08.

This new exemption (for domestic and import transactions in chemical mixtures containing the List II chemicals acetone, ethyl ether, 2-butanone, and toluene) was not discussed in the original NPRM published on September 16, 1998 (63 FR 49506). Therefore, this exemption was implemented on an interim basis with opportunity for public comment in the December 15, 2004 rulemaking (69 FR 74957; corrected at 70 FR 294, January 4, 2005). DEA solicited comments on this portion of the rulemaking.

DEA received three comments in response to the December 15, 2004, rulemaking (69 FR 74957) from interested parties. Two comments were from trade associations, and one comment was from a chemical manufacturer. In general, the comments supported efforts by DEA to regulate chemical mixtures that have potential use to drug traffickers. Each comment specifically supported finalization of the exemption for domestic and import transactions for chemical mixtures containing the List II solvent chemicals acetone, ethyl ether, 2-butanone, and toluene.

Two comments, however, requested that the exemption be expanded to include certain exports of such chemical mixtures. The comments suggested that DEA only regulate exports of such mixtures to certain specific countries of concern. Given the applicability of such solvents for both cocaine and heroin processing, however, the geographic regions of concern are extremely widespread. Additionally, DEA has concerns that exports of solvent chemical mixtures can be subject to re-exportation from destination countries. DEA believes that such exports of chemical mixtures should not be exempted since exports of these chemical mixtures could have significant potential for diversion. Therefore, these chemical mixtures, unless otherwise exempt, are subject to the export and other CSA chemical regulatory requirements.

One commenter expressed concerns regarding the regulatory language found in 21 CFR 1310.08(l) stating that, “Domestic and import transactions in chemical mixtures that contain acetone, ethyl ether, 2-butanone, or toluene unless regulated because of being formulated with another listed chemical above the concentration limit” shall be excluded transactions. The commenter stated that the regulatory language does not make it clear that this exemption applies if the mixture contains more than one of these chemicals (i.e. contains two or more of the following: acetone, ethyl ether, 2-butanone or toluene). The commenter expressed concerns that enforcement officials may deem chemical mixtures containing more than “one” of these solvents as regulated if the total quantity exceeded the List II concentration limits. DEA agrees. Therefore, DEA is modifying 21 CFR 1310.08(l) to read, “Domestic and import transactions in chemical mixtures that contain acetone, ethyl ether, 2-butanone, and/or toluene, unless regulated because of being formulated with other List I or List II chemical(s) above the concentration limit” shall be excluded.

As DEA stated in its Final Rule establishing concentration limits for the vast majority of chemical mixtures (69 FR 74957, December 15, 2004), and codified at 21 CFR 1310.14(c), mixtures containing a listed chemical in concentrations equal to or less than those specified in the “Table of Concentration Limits” are designated as exempt from specified provisions set forth in that section. The concentration limit is set at 35 percent (by weight or volume) for the cumulative amount of acetone, methyl ethyl ketone (MEK), methyl isobutyl ketone (MIBK), toluene, and ethyl ether. Therefore, the table in 21 CFR 1310.14(c) specifies that for exports, the limit applies to the specific chemical or any combination of acetone, ethyl ether, 2-butanone, methyl isobutyl ketone, and toluene, if present in the mixture by summing the concentrations for each chemical. For example, an export involving a chemical mixture containing 20 percent acetone and 20 percent ethyl ether would not be exempt because the cumulative total of 40 percent exceeds the 35 percent concentration limit.

After considering all comments, DEA has decided to exempt domestic and import transactions in chemical mixtures that contain acetone, ethyl ether, 2-butanone, and/or toluene under 21 CFR 1310.08 pursuant to 21 U.S.C. 802(39)(A)(iii) because regulation of such transactions has been determined to be unnecessary for the enforcement of the CSA. DEA determined that there is not a significant risk of domestic diversion for these chemical mixtures.

The above exemption only exempts such chemical mixtures from the domestic recordkeeping and import notification requirements. All other CSA chemical regulatory provisions, as specified in detail in the December 15, 2004 rule [69 FR 74957; corrected at 70 FR 294, January 4, 2005], shall apply.

The CSA authorizes DEA, pursuant to 21 U.S.C. 802(39)(A)(iii), to remove certain transactions in listed chemicals from the definition of a regulated transaction that are unnecessary for enforcement of the CSA. Based on comments to the Federal Register proposed rule “Exemption of Chemical Mixtures” (63 FR 49506, September 16, 1998), DEA identified certain transactions in mixtures of acetone, ethyl ether, 2-butanone, and toluene that are unlikely sources for diversion. DEA was informed that tens of thousands of domestic transactions in these chemical mixtures occur annually. DEA determined that the regulation of domestic and import transactions in mixtures containing the chemicals acetone, ethyl ether, 2-butanone, and toluene were unnecessary for enforcement of the CSA and should be removed from the definition of a regulated transaction.

Since the NPRM to this rulemaking did not discuss this exemption, the public did not have the opportunity to comment on the exclusion of these transactions from the definition of a regulated transaction.

However, to avoid unnecessary burdens on affected companies during the pendency of proceedings in this matter, DEA decided to include as part of its December 15, 2004, Final Rule an interim rule, with request for comment, removing these transactions from the definition of a regulated transaction. Now that DEA has had the opportunity to solicit and review comments, the exemption is being finalized in this rule.

DEA has become aware that a substantial number of chemical mixtures that are not useful to traffickers could potentially be regulated if the chemical mixtures that are subject to this rulemaking were not excluded from certain regulatory requirements. DEA determined that the regulation of these chemical mixtures is not necessary for enforcement of the CSA. Therefore, DEA decided to exempt these chemical mixtures from regulatory controls by exemption of certain types of transactions.

DEA notes that the List II solvent chemicals acetone, ethyl ether, 2-butanone, and toluene contribute to the largest number of potentially regulated chemical mixtures of List II chemicals. To limit the number of potentially regulated chemical mixtures to those necessary for enforcement of the CSA, DEA decided to define all domestic and import transactions of mixtures in these List II solvent chemicals as exempt transactions. This exemption applies to all persons that handle these chemical mixtures and not only to those who are represented in the comments. DEA previously implemented this exemption and is finalizing the exemption in this rulemaking.

In accordance with the Regulatory Flexibility Act (5 U.S.C. 605(b)), the Deputy Administrator has reviewed this regulation and by approving it certifies that this regulation will not have a significant economic impact upon a substantial number of small entities.

This regulation has been drafted and reviewed in accordance with Executive Order 12866, Section 1(b), Principles of Regulation. DEA has determined that this rule is a “significant regulatory action” under Executive Order 12866, Section 3(f), Regulatory Planning and Review, and accordingly this rule has been reviewed by the Office of Management and Budget. This rule finalizes an exemption for domestic and import transactions involving the List II chemicals acetone, ethyl ether, 2-butanone, and toluene.

This regulation meets the applicable standards set forth in Sections 3(a) and 3(b)(2) of Executive Order 12988.

This rulemaking does not preempt or modify any provision of state law; nor does it impose enforcement responsibilities on any state; nor does it diminish the power of any state to enforce its own laws. Accordingly, this rulemaking does not have federalism implications warranting the application of Executive Order 13132.

This rule will not result in the expenditure by state, local, and tribal governments, in the aggregate, or by the private sector, of $118,000,000 or more in any one year, and will not significantly or uniquely affect small governments. Therefore, no actions were deemed necessary under the provisions of the Unfunded Mandates Reform Act of 1995.

This rule is not a major rule as defined by Section 804 of the Small Business Regulatory Enforcement Fairness Act of 1996 (Congressional Review Act). This rule will not result in an annual effect on the economy of $100,000,000 or more; a major increase in costs or prices; or significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based companies to compete with foreign-based companies in domestic and export markets.

This rulemaking finalizes an exemption provision which reduced the paperwork burden on handlers of acetone, ethyl ether, 2-butanone and toluene. By exempting domestic and import transactions involving chemical mixtures containing these List II chemicals DEA is not subjecting these transactions to CSA recordkeeping and reporting requirements. Domestic and import transactions involving chemical mixtures containing acetone, ethyl ether, 2-butanone and toluene are not subject to the following information collections: DEA information collection 1117-0023: Import/Export Declaration for List I and List II Chemicals [imports only]; and DEA information collection 1117-0029: Annual Reporting Requirement for Manufacturers of Listed Chemicals.

Section 503(a) of the Act permits a State to assume primacy for the regulation of surface coal mining and reclamation operations on non-Federal and non-Indian lands within its borders by demonstrating that its State program includes, among other things, “a State law which provides for the regulation of surface coal mining and reclamation operations in accordance with the requirements of this Act * * *; and rules and regulations consistent with regulations issued by the Secretary pursuant to this Act.” See 30 U.S.C. 1253(a)(1) and (7). On the basis of these criteria, the Secretary of the Interior conditionally approved the Missouri program on November 21, 1980. You can find background information on the Missouri program, including the Secretary's findings, the disposition of comments, and conditions of approval, in the November 21, 1980, Federal Register (45 FR 77017). You can also find later actions concerning the Missouri program and program amendments at 30 CFR 925.10, 925.12, 925.15, and 925.16.

By letter dated October 11, 2006 (Administrative Record No. MO-666), Missouri sent us a “permanent rule” amendment to its program regarding bonding under SMCRA (30 U.S.C. 1201 et seq. ). This amendment was sent as a replacement for Missouri's “emergency rule” that we previously approved on June 8, 2006 (71 FR 33243). The “emergency rule” allowed Missouri to transition from a “bond pool” approach to bonding to a “full cost bond” approach in a timely manner. The “permanent rule” amendment, when approved, will become a permanent part of Missouri's program.

We announced receipt of Missouri's proposed “emergency rule” amendment in the November 29, 2005, Federal Register (70 FR 71425). In the same document, we opened the public comment period and provided an opportunity for a public hearing or meeting on the adequacy of the amendment. We did not hold a public hearing or meeting because no one requested one and we did not receive any comments. We also stated in this Federal Register document that if Missouri submitted a “permanent rule” with language that has the same meaning as the “emergency rule,” we would publish a final rule and Missouri's “permanent rule” would become part of the Missouri program. Because Missouri's “permanent rule” has the same meaning as the “emergency rule,” we are proceeding with the final rule.

Following are the findings we made concerning Missouri's “permanent rule” amendment under SMCRA and the Federal regulations at 30 CFR 732.15 and 732.17. We are approving the amendment as described below. Any revisions that we do not specifically discuss below concern nonsubstantive wording or editorial changes.

Missouri's definition for “regulatory authority,” found at 10 CSR [Code of State Regulations] 40-8.010(82), means the Land Reclamation Commission (commission), the director, or their designated representatives and employees unless otherwise specified in the State's rules. Missouri proposed to replace the words “commission” or “regulatory authority” with the word “director” in the following regulations: 10 CSR 40-7.011(2)(A), (3)(C), (4)(B), (6)(B)1., 5., 6., and 7., (6)(C)1. and 8., (6)(D)2., and (6)(D)2.B, 3.B, 3.B(I) and 5.C; and 10 CSR 40-7.041(1)(A), (B)1. and (B)2. Missouri proposed to improve operational efficiency by specifying that the director is to perform certain duties. We find that the substitution of the word “director” for the words “commission” or “regulatory authority” will not render Missouri's regulations less effective than the Federal regulations because in accordance with Missouri's definition for regulatory authority, the director is a regulatory authority as is the commission and the certain duties specified in the regulations cited above are not duties reserved solely for the commission according to section 444.810 of Missouri's surface coal mining law. Therefore, we are approving these revisions.

The State regulations listed in the table below contain language that is the same as or similar to the corresponding sections of the Federal regulations.

Because the above State regulations have the same meaning as the corresponding Federal regulations, we find that they are no less effective than the Federal regulations.

a. Missouri proposed to revise its definition for personal bond in paragraph (1)(C) to read as follows:

Missouri has chosen to limit the vehicles that support an indemnity agreement to negotiable certificates of deposit and irrevocable letters of credit. Missouri also provides that the director may use funds from personal bonds if reclamation is not completed or if the permit is revoked before the completion of reclamation. We are, therefore, approving Missouri's definition for personal bond because it is no less effective than the above Federal regulations.

b. Missouri proposed to revise its definition for Phase I bond in paragraph (1)(D) to read as follows:

Missouri proposed to revise paragraph (6)(A)8. regarding surety bonds. This paragraph inappropriately refers to a “bank” or “bank charter” when the subject matter of this paragraph pertains to a surety company. Missouri proposed to delete the language that refers to a “bank” or “bank charter.” Also, Missouri proposed to correct the incorrect reference citation, 10 CSR 40-7.031(A)(6), so that it correctly reads 10 CSR 40-7.031(1)(F)2. We are approving Missouri's revisions regarding the deletion of the terms “bank” and “bank charter” because they are inappropriately included in this paragraph that pertains only to surety companies. We are also approving the correction of the incorrect reference citation.

Finally, Missouri proposed that, upon the incapacity of the surety because of bankruptcy or insolvency, or suspension or revocation of its license, the permittee must promptly notify the director. Upon this notification, the director must issue a notice of violation (NOV) against the operator who is without bond coverage specifying that the operator must replace the bond in no more than 90 days. If the NOV is not abated in accordance with the schedule, a cessation order must be issued requiring immediate compliance with 10 CSR 40-3.150(4), Cessation of Operations—Permanent.

The Federal regulation at 30 CFR 800.16(e)(2) sets forth a requirement that upon the incapacity of a bank or surety company by reason of bankruptcy or insolvency, or suspension or revocation of a charter or license, the permittee must be deemed to be without bond coverage and must promptly notify the regulatory authority. When the regulatory authority receives the notification, it must notify the operator in writing to replace the bond in a period not to exceed 90 days. If the operator does not provide an adequate bond, the operator must cease mining and immediately begin reclamation operations in accordance with the approved reclamation plan.

We are approving the above revision because it is no less effective than the Federal regulation at 30 CFR 800.16(e)(2).

i. Missouri proposed to revise paragraphs (6)(B)2., 4., 6., and 7. regarding personal bonds secured by certificates of deposit. Paragraph (6)(B)4. refers to banks or savings and loan companies issuing the certificates of deposit, while paragraphs (6)(B)2., 6., and 7. only refer to banks issuing certificates of deposit. Missouri proposed to revise these paragraphs to make them consistent with paragraph (6)(B)4. Missouri also proposed to remove the term “Federal Savings and Loan Insurance Corporation (FSLIC)” from this paragraph because the FSLIC was abolished and the Federal Deposit Insurance Corporation (FDIC) now insures savings and loan companies. We are approving these revisions because the Federal regulation at 30 CFR 800.21(a)(4) implies that banks or savings and loan companies are acceptable sources for certificates of deposit by its reference to certificates of deposits insured by the FDIC or the FSLIC.

ii. Missouri proposed to revise paragraph (6)(B)4. by adding that permittees may not submit, from a single bank or savings and loan company, certificates of deposit totaling more than the maximum insurable amount as determined by the FDIC. We are approving this revision because the Federal regulation at 30 CFR 800.21(a)(4) contains the provision that an individual certificate of deposit cannot be accepted in an amount that is greater than the maximum insurable amount as determined by the FDIC.

iii. Missouri proposed to revise paragraph (6)(B)7. by changing the number of days that an operator has for replacing bond coverage from 60 to 90 days if the operator is without bond because of a bank's or savings and loan company's insolvency or bankruptcy or suspension or revocation of its charter or license. Missouri also proposed to add a requirement to paragraph (6)(B)7. that prohibits an operator from resuming mining operations until after the director has determined that an acceptable bond has been posted. We are approving the revision because the Federal regulation at 30 CFR 800.16(e) provides that the operator must replace the bond in a period not to exceed 90 days and that the operator must not resume mining operations until the regulatory authority has determined that an acceptable bond has been posted.

i. Missouri proposed to revise paragraph (6)(C)4. as follows:

ii. Missouri proposed to revise paragraph (6)(C)9. to require the bond to have a mechanism by which a bank must give prompt notice to the director and the permittee of any action filed alleging the insolvency or bankruptcy of the bank or permittee or alleging any violations which would result in the suspension or revocation of the bank's charter or license to do business. Missouri also proposed that upon the incapacity of any bank by reason of insolvency or bankruptcy or suspension or revocation of its charter or license, the permittee shall be deemed to be without bond and the director must, upon notification of the incapacity, issue an NOV to the operator who is without bond. The NOV must specify a period not to exceed 90 days in which to replace the bond coverage. In addition, if the NOV is not abated in accordance with the abatement schedule, a cessation order must be issued requiring the immediate compliance with 10 CSR 40-3.150(4) Cessation of Operations—Permanent and the mining operations must not resume until the director has determined that an acceptable bond has been posted.

The Federal regulation at 30 CFR 800.16(e)(1) requires the bond to have a mechanism for a bank or surety company to promptly notify the regulatory authority and the permittee of any action filed alleging the insolvency or bankruptcy of the bank, surety company, or permittee or alleging any violations which would result in the suspension or revocation of the bank's or surety company's charter or license to do business. The Federal regulation at 30 CFR 800.16(e)(2) deems the permittee to be without bond coverage upon the incapacity of the bank or surety company by reason of insolvency or bankruptcy or suspension or revocation of its charter or license and requires the permittee to promptly notify the regulatory authority of the incapacity. The regulatory authority upon this notification must notify, in writing, the operator who is without bond coverage, to replace bond coverage in a period not to exceed 90 days. If an adequate bond is not posted, the operator must (1) cease mining, (2) comply with 30 CFR 816.132 or 30 CFR 817.132, Cessation of Operations: Permanent, and (3) immediately begin reclamation operations in accordance with the reclamation plan.

We are approving Missouri's revisions because they are no less effective than the above Federal regulations.

i. Missouri proposed to revise paragraph (6)(D)8. by changing the time period for replacing the bond from 60 days to 90 days if the financial conditions of the permittee or third-party guarantors change so that they no longer satisfy the requirements for being able to post self bonds. Missouri also proposed that if the bond is not replaced in accordance with the schedule set by the director, the operator must immediately begin to conduct reclamation operations in accordance with the reclamation plan.

The Federal regulation at 30 CFR 800.23(g) provides that if the financial conditions of the applicant, parent, or non-parent corporate guarantor change so that the criteria for being able to post self bonds are not met, the permittee must immediately notify the regulatory authority and must post an alternative form of bond within 90 days. If the permittee does not post the alternate bond, the operator must cease mining operations and immediately begin to conduct reclamation operations in accordance with the reclamation plan.

We are approving Missouri's revision because it is no less effective than the Federal regulation at 30 CFR 800.23(g).

Missouri proposed to revise paragraph (7)(A). This paragraph allows permittees to replace existing surety or personal bonds with other surety or personal bonds. Missouri proposed to add self bonds so that permittees may replace existing surety, personal or self bonds with other surety, personal or self bonds.

The Federal regulation at 30 CFR 800.30(a) provides that the regulatory authority may allow a permittee to replace existing bonds with other bonds that provide adequate coverage.

We are approving Missouri's revision because it is no less effective than the Federal regulation at 30 CFR 800.30(a).

1. Missouri proposed to revise paragraphs (2) and (2)(E) Paragraph (2) reads as follows:

Paragraph (2)(E) reads as follows:

2. Missouri proposed to revise paragraph (2)(A) regarding the criteria for release of Phase I liability. Paragraph (2)(A) reads as follows:

The Federal counterpart regulation is found at 30 CFR 800.40(c)(1) and provides that Phase I reclamation is complete after the operator completes the backfilling, regrading (which may include the replacement of topsoil), and drainage control of the bonded area in accordance with the approved reclamation plan. We are approving the deletion of the above phrase from Missouri's regulation because it will not render the State regulation less effective than the Federal counterpart regulation.

3. Missouri proposed to revise paragraph (2)(B)4. regarding the criteria for qualifying for release of Phase II liability to read as follows:

4. Missouri proposed to revise paragraph (2)(D) regarding bond release by deleting the language and replacing it with new language, and by adding new paragraphs 1. through 3. to read as follows:

Missouri proposed to revise paragraph (2) regarding the procedures for permit suspension or revocation and paragraph (4) regarding declaration of permit revocation. More specifically, Missouri proposed to revise paragraphs (2)(E)1. and (4), and to delete paragraphs (2)(E)2.C and D in order to remove provisions related to the Missouri Coal Mine Land Reclamation Fund. Missouri also proposed to add new paragraphs (4)(A) through (B)2. to specify what monies the director may use for reclamation purposes for bonds forfeited before January 1, 2006, and for those forfeited on or after January 1, 2006.

The Federal regulations at 30 CFR 800.11(a) through (d) set forth the provisions for a permit applicant to file, with the regulatory authority, a bond or bonds for performance that is conditioned upon the faithful performance of all the requirements of the Act, the regulatory program, the permit, and the reclamation plan. The regulations also include a “full cost bond” bonding system. The Federal regulation at 30 CFR 800.11(e) provides that we may approve an alternative bonding system as part of a State program. The previously approved Missouri Coal Mine Land Reclamation Fund is a “bond pool” fund that is part of Missouri's alternative bonding system and is used to complete reclamation on permit sites for which the permits have been revoked and the associated bonds have been forfeited. Missouri proposed to terminate its alternative bonding system and to adopt a “full cost bond” bonding system effective January 1, 2006. With this transition to a “full cost bond” bonding system, Missouri proposed that only permit sites whose bonds have been forfeited before January 1, 2006, are eligible to have monies expended from the “bond pool” fund for the purpose of completing reclamation of the sites. Missouri also proposed that permit sites whose bonds have been forfeited on or after January 1, 2006, are eligible to have monies expended from the forfeited “full cost bonds” for the purpose of completing reclamation of the sites. We are approving Missouri's revisions as they are no less effective than the Federal regulations because permit sites under the alternative bonding system and the “full cost bond” bonding system have funds available for reclamation, if required.

Finally, Missouri proposed to add new paragraphs (4)(B)1. and 2. to read as follows:

We asked for public comments on the emergency rule amendment (70 FR 71425), but did not receive any.

On November 10, 2005, and December 13, 2005, under 30 CFR 732.17(h)(11)(i) and section 503(b) of SMCRA, we requested comments on the emergency rule amendment from various Federal agencies with an actual or potential interest in the Missouri program (Administrative Record Nos. MO-665.1 and MO-665.9). We did not receive any comments.

Under 30 CFR 732.17(h)(11)(ii), we are required to get a written concurrence from EPA for those provisions of the program amendment that relate to air or water quality standards issued under the authority of the Clean Water Act (33 U.S.C. 1251 et seq. ) or the Clean Air Act (42 U.S.C. 7401 et seq. ). None of the revisions that Missouri proposed to make in this amendment pertain to air or water quality standards. Therefore, we did not ask EPA to concur on the emergency rule amendment.

On November 10, 2005, and December 13, 2005, under 30 CFR 732.17(h)(11)(i), we requested comments on the emergency rule amendment from EPA (Administrative Record Nos. MO-665.1 and MO-665.9). EPA did not respond to our request.

Under 30 CFR 732.17(h)(4), we are required to request comments from the SHPO and ACHP on amendments that may have an effect on historic properties. On November 10, 2005, and December 13, 2005, we requested comments on Missouri's emergency rule amendment (Administrative Record No. MO-665.1 and MO-665.9), but neither responded to our request.

Based on the above findings, we approve the amendment Missouri sent us on October 11, 2006.

To implement this decision, we are amending the Federal regulations at 30 CFR part 925, which codify decisions concerning the Missouri program to include the original amendment submission date and the date of final publication for this rulemaking.

This final rule has been issued without prior public notice or opportunity for public comment. The Administrative Procedure Act (APA) (5 U.S.C. 553) provides an exception to the notice and comment procedures when an agency finds there is good cause for dispensing with such procedures on the basis that they are impracticable, unnecessary or contrary to the public interest. We have determined that under 5 U.S.C. 553(b)(3)(B), good cause exists for dispensing with the notice of proposed rulemaking and public comment procedures for this rule. The provisions being approved in this rulemaking are substantively identical to those approved in the emergency rulemaking on June 8, 2006. At that time, notice and an opportunity to comment were provided to members of the public and no comments were received. Consequently, an additional comment period on the same provisions is viewed as unnecessary. In addition, we find that good cause exists under 5 U.S.C. 553(d)(3) to make this final rule effective immediately. Section 503(a) of SMCRA requires that the State's program demonstrate that the State has the capability of carrying out the provisions of the Act and meeting its purposes. Making this rule effective immediately will expedite that process. SMCRA requires consistency of State and Federal standards.

This rule does not have takings implications. This determination is based on the analysis performed for the counterpart Federal regulations.

This rule is exempted from review by the Office of Management and Budget (OMB) under Executive Order 12866.

The Department of the Interior has conducted the reviews required by section 3 of Executive Order 12988 and has determined that this rule meets the applicable standards of subsections (a) and (b) of that section. However, these standards are not applicable to the actual language of State regulatory programs and program amendments because each program is drafted and promulgated by a specific State, not by OSM. Under sections 503 and 505 of SMCRA (30 U.S.C. 1253 and 1255) and the Federal regulations at 30 CFR 730.11, 732.15, and 732.17(h)(10), decisions on proposed State regulatory programs and program amendments submitted by the States must be based solely on a determination of whether the submittal is consistent with SMCRA and its implementing Federal regulations and whether the other requirements of 30 CFR parts 730, 731, and 732 have been met.

This rule does not have Federalism implications. SMCRA delineates the roles of the Federal and State governments with regard to the regulation of surface coal mining and reclamation operations. One of the purposes of SMCRA is to “establish a nationwide program to protect society and the environment from the adverse effects of surface coal mining operations.” Section 503(a)(1) of SMCRA requires that State laws regulating surface coal mining and reclamation operations be “in accordance with” the requirements of SMCRA, and section 503(a)(7) requires that State programs contain rules and regulations “consistent with” regulations issued by the Secretary pursuant to SMCRA.

In accordance with Executive Order 13175, we have evaluated the potential effects of this rule on Federally-recognized Indian tribes and have determined that the rule does not have substantial direct effects on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. This determination is based on the fact that the Missouri program does not regulate coal exploration and surface coal mining and reclamation operations on Indian lands. Therefore, the Missouri program has no effect on Federally-recognized Indian tribes.

On May 18, 2001, the President issued Executive Order 13211 which requires agencies to prepare a Statement of Energy Effects for a rule that is (1) considered significant under Executive Order 12866, and (2) likely to have a significant adverse effect on the supply, distribution, or use of energy. Because this rule is exempt from review under Executive Order 12866 and is not expected to have a significant adverse effect on the supply, distribution, or use of energy, a Statement of Energy Effects is not required.

This rule does not require an environmental impact statement because section 702(d) of SMCRA (30 U.S.C. 1292(d)) provides that agency decisions on proposed State regulatory program provisions do not constitute major Federal actions within the meaning of section 102(2)(C) of the National Environmental Policy Act (42 U.S.C. 4332(2)(C)).

This rule does not contain information collection requirements that require approval by OMB under the Paperwork Reduction Act (44 U.S.C. 3507 et seq. ).

The Department of the Interior certifies that this rule will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ). The State submittal, which is the subject of this rule, is based upon counterpart Federal regulations for which an economic analysis was prepared and certification made that such regulations would not have a significant economic effect upon a substantial number of small entities. In making the determination as to whether this rule would have a significant economic impact, the Department relied upon the data and assumptions for the counterpart Federal regulations.

This rule is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act. This rule: (a) Does not have an annual effect on the economy of $100 million; (b) Will not cause a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions; and (c) Does not have significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of U.S.-based enterprises to compete with foreign-based enterprises. This determination is based upon the fact that the State submittal, which is the subject of this rule, is based upon counterpart Federal regulations for which an analysis was prepared and a determination made that the Federal regulation was not considered a major rule.

This rule will not impose an unfunded mandate on State, local, or tribal governments or the private sector of $100 million or more in any given year. This determination is based upon the fact that the State submittal, which is the subject of this rule, is based upon counterpart Federal regulations for which an analysis was prepared and a determination made that the Federal regulations did not impose an unfunded mandate.

Aboriginal subsistence whaling in the United States is governed by the Whaling Convention Act (16 U.S.C. 916 et seq. ). Regulations that implement the Act, found at 50 CFR 230.6, require the Secretary of Commerce (Secretary) to publish, at least annually, aboriginal subsistence whaling quotas and any other limitations on aboriginal subsistence whaling deriving from regulations of the IWC.

At the 2002 Special Meeting of the IWC, the Commission set quotas for aboriginal subsistence use of bowhead whales from the Bering-Chukchi-Beaufort Seas stock. The bowhead quota was based on a joint request by the United States and the Russian Federation, accompanied by documentation concerning the needs of two Native groups: Alaska Eskimos and Chukotka Natives in the Russian Far East.

This action by the IWC thus authorized aboriginal subsistence whaling by the AEWC for bowhead whales. This aboriginal subsistence harvest is conducted in accordance with a cooperative agreement between NOAA and the AEWC.

The IWC set a 5-year block quota of 280 bowhead whales landed. For each of the years 2003 through 2007, the number of bowhead whales struck may not exceed 67, except that any unused portion of a strike quota from any year, including 15 unused strikes from the 1998 through 2002 quota, may be carried forward. No more than 15 strikes may be added to the strike quota for any one year. At the end of the 2006 harvest, there were 15 unused strikes available for carry-forward, so the combined strike quota for 2007 is 82 (67 + 15).

This arrangement ensures that the total quota of bowhead whales landed and struck in 2007 will not exceed the quotas set by the IWC. Under an arrangement between the United States and the Russian Federation, the Russian natives may use no more than seven strikes, and the Alaska Eskimos may use no more than 75 strikes.

NOAA is assigning 75 strikes to the Alaska Eskimos. The AEWC will allocate these strikes among the 10 villages whose cultural and subsistence needs have been documented in past requests for bowhead quotas from the IWC, and will ensure that its hunters use no more than 75 strikes.

The IWC regulations, as well as the NOAA regulation at 50 CFR 230.4(c), forbid the taking of calves or any whale accompanied by a calf.

NOAA regulations (at 50 CFR 230.4) contain a number of other prohibitions relating to aboriginal subsistence whaling, some of which are summarized here. Only licensed whaling captains or crew under the control of those captains may engage in whaling. They must follow the provisions of the relevant cooperative agreement between NOAA and a Native American whaling organization. The aboriginal hunters must have adequate crew, supplies, and equipment. They may not receive money for participating in the hunt. No person may sell or offer for sale whale products from whales taken in the hunt, except for authentic articles of Native handicrafts. Captains may not continue to whale after the relevant quota is taken, after the season has been closed, or if their licenses have been suspended. They may not engage in whaling in a wasteful manner.

Regulations governing the Atlantic bluefish fishery are found at 50 CFR part 648. The regulations require annual specification of a commercial quota that is apportioned among the coastal states from Florida through Maine. The process to set the annual commercial quota and the percent allocated to each state is described in § 648.160.

Two or more states, under mutual agreement and with the concurrence of the Administrator, Northeast Region, NMFS (Regional Administrator), can transfer or combine bluefish commercial quota under § 648.160(f). The Regional Administrator is required to consider the criteria set forth in § 648.160(f)(1) in the evaluation of requests for quota transfers or combinations.

Virginia has agreed to transfer 150,000 lb (68,039 kg) of its 2007 commercial quota to New York. The Regional Administrator has determined that the criteria set forth in § 648.160(f)(1) have been met. The revised bluefish quotas for calendar year 2007 are: New York, 1,034,278 lb (469,141 kg); and Virginia, 868,660 lb (394,018 kg).

This action is taken under 50 CFR part 648 and is exempt from review under Executive Order 12866.

These regulations modify the process NMFS uses to renew and replace permits in the U. S. West Coast HMS fisheries managed under the HMS FMP. The FMP was prepared by the Pacific Fishery Management Council and was implemented through regulations at 50 CFR part 660 under authority of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act), 16 U.S.C. 1801 et seq.

NMFS requires a permit for all commercial vessels and all recreational charter vessels that fish for HMS in the U.S. exclusive economic zone (EEZ) off the States of California, Oregon, and Washington, or land or transship HMS shoreward of the outer boundary of the U.S. EEZ off the States of California, Oregon, and Washington. The purpose of the HMS permit is to identify vessels in the HMS fisheries so that NMFS knows those participants who need to be contacted when management information is required and who to notify when potential management actions affecting the fisheries are being considered.

The requirement for a permit was established by final rule implementing the approved portions of the FMP for HMS published on April 7, 2004 (69 FR 18444). These permits were initially issued in 2005 after publishing a Federal Register notice on February 10, 2005 (70 FR 7022), that announced approval by the Office of Management and Budget of the collection-of-information components of the permit system.

Permits are issued to the managing owner of a specific vessel for a 2-year term. The initial issuance of HMS permits began in 2005 and these permits expire in 2007. NMFS initially implemented a permit term renewal process intentionally staggered so that there will be less likelihood of an excessive number of renewals at any one time of the year. NMFS used the last day of the month designated by the last digit of the vessel identification number as determining the renewal date for expiring permits (e.g., if the vessel identification number ends in 3, the renewal date is March 31, 2 years later). Use of this criterion extends the renewal process over a 10-month term: January through October.

Because of the administrative burden of processing the high number of permits in effect, this final rule modifies the criterion by using the last day of the managing vessel owner's birth month as the expiration date. The managing vessel owner's date of birth is required in the Pacific HMS Vessel Permit Application and is already contained in the Pacific HMS Vessel Permit database. NMFS believes that staggering the renewal process over 12 months rather than 10 months will improve the efficiency of the permit renewal process. The first renewal date under this new system will be the last day of the vessel owner's birthday month in the second calender year after the permit is issued. NMFS anticipates that the system implemented by this final rule should result in delivery of permits to vessel operators in a more efficient manner. This final rule does not require any new information to be provided by the applicant. A Southwest Region Pacific HMS Vessel Permit Application form may still be obtained from the SFD (see ADDRESSES ) or downloaded from the Southwest Region home page ( http://swr.nmfs.noaa.gov/permits.htm ) to apply for a permit under this section. A completed application is one that contains all the required information and signatures. NMFS intends to contact vessel owners with a renewal notice by mail 3 months in advance of their permit expiration date. This procedure should provide additional time for fishermen to renew their HMS permits before the start of the fishing season. NMFS will also allow HMS fishermen to renew their permits even earlier by contacting NMFS directly (see ADDRESSES ).

Replacement permits are issued by NMFS to vessel owners to replace lost or mutilated permits. Vessel owners with a lost or mutilated permit primarily notify NMFS by telephone when requesting a replacement permit. NMFS has never established a formal process to provide replacement permits, but the number of requests for replacements over the past year make it clear that such a process is required. Under this regulation, vessel owners requiring a replacement permit must submit a new completed application form to NMFS by mail or fax (see ADDRESSES ).

A summary of the comments on the proposed rule and responses to those comments follow. After considering these comments, NMFS is adopting the proposed rule as final without change.

Comment 1: Several commenters objected to the use of birth month as the criterion used to establish the expiration date. They stated that the birth month of many vessel owners may coincide during months when they could be at sea.

Response: This final rule only substitutes the month used to determine the expiration of a 2-year term HMS permit from the last digit of the vessel's identification number to the birth month of the vessel owner. When NMFS originally set up the process for permit renewals in a final rule published in 2004 and implemented in April 2005, it announced that it would use the last digit of the vessel identification number of an owner's vessel to determine the month the permit would be renewed. Based on a 0 to 9 numbering system, this staggered the renewal process over a 10-month time period. This procedure was designed at a time when NMFS believed that approximately 1300 HMS permits would be issued for HMS fisheries. Since the HMS permit program originated in April 2005, NMFS has issued approximately 2,000 HMS permits. Use of the vessel owner's birth month allows NMFS to stagger the issuance of permits over a 12 month time period and thereby provide more time to complete the renewal process. However, NMFS is sensitive to the concerns raised by commenters pertaining to a permit expiring when they may be at sea. NMFS will notify each fisherman by mail 3 months in advance of the expiration of her/his HMS permit. NMFS will also allow fishermen to contact NMFS directly and request renewal of their permit prior to the expiration date (see ADDRESSES ).

Comment 2: Some commenters suggested that NMFS standardize the procedure for renewing permits and do it at one time of the year such at the end or beginning of the calender year when many fishermen are not fishing and are in port.

Response: NMFS had always intended that HMS permit renewals be staggered over an extended period to eliminate the likelihood of an extreme permit renewal accumulation at any one time of the year. NMFS decided in 2004 that a staggered process would be more efficient for the agency and more likely to result in the delivery of permits to each fisherman in a timely manner.

Comment 3: Regarding the idea of processing all permit renewals within a shorter time frame, one commenter believed that if NMFS could place two people on permit renewals full time for two weeks, that NMFS could renew up to 1600 permits within that period.

Response: In almost 2 years of processing HMS permit applications, NMFS has learned that approximately 30% percent of the applications are lacking some type of information (e.g., address, date of birth etc.). In order to complete the application, NMFS must contact the vessel owner either by phone or mail to obtain the omitted information. NMFS has learned that any followup effort on its part does extend the time required to process a permit application especially if the vessel owner is difficult to reach. NMFS had always intended that HMS permit renewals be staggered over an extended period to eliminate the likelihood of an extreme permit renewal accumulation at any one time of the year which might prevent delivery of permits to each fisherman in a timely manner.

Comment 4: One commenter suggested staggering the permit renewals on a yearly basis by providing three different terms or periods of duration for future renewals. By this method, one-third of the permits would have a term of 1-year, one-third would have a 2-year term, and the last third would have a 3-year term. Then after the first year, the 1-year group would be ready for renewal. In the second year, the 2-year group would be up for renewal and so on. By using this system, NMFS would only have to renew one third of all HMS permits each year and thereby could conduct the renewal process in a much shorter time frame.

Response: NMFS appreciates recommendations from the fishing industry for simplifying processes that affect them. However, the intent of this final rule is only to change the criterion for determining what month a vessel owner's HMS permit comes up for renewal. There is no intent to change the term of the permit. When NMFS originally promulgated proposed regulations for the HMS permit process in 2003, it was considering setting the term of the permits at 5 years. However, after reviewing the experience of other fisheries and other areas of the country, it became clear to NMFS that a permit period of 2 years or less is more effective for ensuring accurate information about patterns of fishery participation and the names and addresses of participants in the fisheries. NMFS believes now, as it did then, that a permit term of more than 2 years increases the probability that changes in vessel names and owners and interests of related businesses will not be accurately tracked compared to a 2-year or less term. A longer term would reduce NMFS' effectiveness in advising HMS participants of changes in management measures or in permit and reporting requirements.

Comment 5: In addition to processing all HMS permits renewals at one time of the year, one commenter also suggested combining all permits handled by NMFS (e.g., HMS, Federal groundfish permits, etc.) into a single process. The commenter mentioned that this would simplify the permit requirements and minimize complications to fishermen to ensure that they were in compliance with all permits.

Response: NMFS makes note of this comment and recognizes it as a laudable objective but such a recommendation goes beyond the scope of this rulemaking.

This final rule revises procedures for renewing and replacing permits issued under regulations implementing the HMS FMP published at 69 FR 18444 on April 7, 2004. The Regional Administrator, NMFS Southwest Region, determined that this rule is consistent with the Magnuson-Stevens Fishery Conservation and Management Act, codified at 16 U.S.C. 1801 et seq.

This final rule has been determined to be not significant for the purposes of Executive Order (E.O.) 12866.

The Chief Counsel for Regulation of the Department of Commerce certified to the Chief Counsel for Advocacy of the Small Business Administration during the proposed rule stage (71 FR 70939) that this action would not have a significant economic impact on a substantial number of small entities. The factual basis for the certification was published in the proposed rule and is not repeated here. No comments were received regarding this certification. As a result, a regulatory flexibility analysis was not required and none was prepared.

This final rule contains a collection-of-information requirement subject to the Paperwork Reduction Act (PRA) and which has been approved by OMB under control number 0648-0204. Public reporting burden for preparing an HMS Vessel Permit Application is estimated to average 0.42 hours per vessel, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection-of-information. Send comments regarding these burden estimates or any other aspect of this data collection, including suggestions for reducing the burden, to NMFS (see ADDRESSES ) and by e-mail to David Rostker@omb.eop.gov , or fax to (202) 395-7285.

Notwithstanding any other provision of the law, no person is required to respond to, and no person shall be subject to a penalty for failure to comply with a collection-of-information subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB control number.

Administrative practice and procedure, Permits.

NMFS manages the groundfish fishery in the GOA exclusive economic zone according to the Fishery Management Plan for Groundfish of the Gulf of Alaska (FMP) prepared by the North Pacific Fishery Management Council under authority of the Magnuson-Stevens Fishery Conservation and Management Act. Regulations governing fishing by U.S. vessels in accordance with the FMP appear at subpart H of 50 CFR part 600 and 50 CFR part 679.

The A season allocation of the 2007 TAC of Pacific cod apportioned to vessels catching Pacific cod for processing by the inshore component of the Western Regulatory Area of the GOA is 7,813 metric tons (mt) as established by the 2007 and 2008 harvest specifications for groundfish of the GOA (72 FR 9676, March 5, 2007).

In accordance with § 679.20(d)(1)(i), the Administrator, Alaska Region, NMFS (Regional Administrator), has determined that the 2007 TAC of Pacific cod apportioned to vessels catching Pacific cod for processing by the inshore component of the Western Regulatory Area of the GOA will soon be reached. Therefore, the Regional Administrator is establishing a directed fishing allowance of 7,613 mt, and is setting aside the remaining 200 mt as bycatch to support other anticipated groundfish fisheries. In accordance with § 679.20(d)(1)(iii), the Regional Administrator finds that this directed fishing allowance has been reached. Consequently, NMFS is prohibiting directed fishing for Pacific cod by vessels catching Pacific cod for processing by the inshore component in the Western Regulatory Area of the GOA.

After the effective date of this closure the maximum retainable amounts at § 679.20(e) and (f) apply at any time during a trip.

This action responds to the best available information recently obtained from the fishery. The Assistant Administrator for Fisheries, NOAA (AA), finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such requirement is impracticable and contrary to the public interest. This requirement is impracticable and contrary to the public interest as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay the closure of Pacific cod apportioned to vessels catching Pacific cod for processing by the inshore component of the Western Regulatory Area of the GOA. NMFS was unable to publish a notice providing time for public comment because the most recent, relevant data only became available as of March 6, 2007.

The AA also finds good cause to waive the 30-day delay in the effective date of this action under 5 U.S.C. 553(d)(3). This finding is based upon the reasons provided above for waiver of prior notice and opportunity for public comment.

This action is required by § 679.20 and is exempt from review under Executive Order 12866.