This rule is issued under Marketing Order No. 985 (7 CFR part 985), as amended, regulating the handling of spearmint oil produced in the Far West (Washington, Idaho, Oregon, and designated parts of Nevada and Utah), hereinafter referred to as the “order.” The order is effective under the Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-674), hereinafter referred to as the “Act.”

The Department of Agriculture (USDA) is issuing this rule in conformance with Executive Order 12866.

This rule has been reviewed under Executive Order 12988, Civil Justice Reform. Under the marketing order now in effect, salable quantities and allotment percentages may be established for classes of spearmint oil produced in the Far West. This proposed rule would establish the quantity of spearmint oil produced in the Far West, by class, which handlers may purchase from, or handle on behalf of, producers during the 2011-2012 marketing year, which begins on June 1, 2011.

The Act provides that administrative proceedings must be exhausted before parties may file suit in court. Under section 608c(15)(A) of the Act, any handler subject to an order may file with USDA a petition stating that the order, any provision of the order, or any obligation imposed in connection with the order is not in accordance with law and request a modification of the order or to be exempted therefrom. A handler is afforded the opportunity for a hearing on the petition. After the hearing, USDA would rule on the petition. The Act provides that the district court of the United States in any district in which the handler is an inhabitant, or has his or her principal place of business, has jurisdiction to review USDA's ruling on the petition, provided an action is filed not later than 20 days after the date of the entry of the ruling.

The Committee meets annually in the fall to adopt a marketing policy for the ensuing marketing year or years. In determining such marketing policy, the Committee considers a number of factors, including, but not limited to, the current and projected supply, estimated future demand, production costs, and producer prices for all classes of spearmint oil, as well as input from spearmint oil handlers and producers regarding prospective marketing conditions. During the meeting, the Committee recommends to USDA any volume regulations deemed necessary to meet market requirements and to establish orderly marketing conditions for Far West spearmint oil. If the Committee's marketing policy considerations indicate a need for limiting the quantity of any or all classes of spearmint oil marketed, the Committee subsequently recommends the establishment of a salable quantity and allotment percentage for such class or classes of oil for the forthcoming marketing year.

The salable quantity represents the total amount of each class of spearmint oil that handlers may purchase from, or handle on behalf of, producers during the marketing year. Each producer is allotted a prorated share of the salable quantity by applying the allotment percentage to that producer's allotment base for each applicable class of spearmint oil. The producer allotment base is each producer's quantified share of the spearmint oil market based on a statistical representation of past spearmint oil production and the accommodation for reasonable and normal adjustments to such base as prescribed by the Committee and approved by USDA. Salable quantities are established at levels intended to meet market requirements and to establish orderly marketing conditions. Committee recommendations for volume controls are made well in advance of the period in which the regulations are to be effective, thereby allowing producers the chance to adjust their production decisions accordingly.

Pursuant to authority in §§ 985.50, 985.51, and 985.52 of the order, the full eight-member Committee met on October 13, 2010, and recommended salable quantities and allotment percentages for both classes of oil for the 2011-2012 marketing year. The Committee, in a vote of six members in favor and two members opposed, recommended the establishment of a salable quantity and allotment percentage for Scotch spearmint oil of 694,774 pounds and 34 percent, respectively. The two members opposing the action favored an undetermined greater salable quantity and allotment percentage for Scotch spearmint oil. For Native spearmint oil, the Committee unanimously recommended the establishment of a salable quantity and allotment percentage of 1,012,983 pounds and 44 percent, respectively.

This rule would limit the amount of spearmint oil that handlers may purchase from, or handle on behalf of, producers during the 2011-2012 marketing year, which begins on June 1, 2011. Salable quantities and allotment percentages have been placed into effect each season since the order's inception in 1980.

The U.S. production of Scotch spearmint oil is concentrated in the Far West, which includes Washington, Idaho, Oregon, and a portion of Nevada and Utah. Scotch type oil is also produced in seven other States: Indiana, Michigan, Minnesota, Montana, North Dakota, South Dakota, and Wisconsin. Additionally, Scotch spearmint oil is produced outside of the U.S., with China and India being the largest global competitors of domestic Scotch spearmint oil production.

The Far West's share of total global Scotch spearmint oil sales has varied considerably over the past several decades, from 72 percent in 1980 to 27 percent in 2002. Recently, sales of Far West Scotch spearmint oil have risen to over 48 percent of world sales, and are expected to hold steady, or go even higher, in the coming years.

In spite of the Far West's growing share of the world market for Scotch spearmint oil, the industry has faced some stressful marketing conditions during the most recent marketing years. Spearmint oil producers experienced relatively good economic conditions in the years from 2004 through 2007, which led to overproduction and an environment of excess supply in the market beginning in 2008 and continuing through 2010. The Far West region, which produced 635,508 pounds of Scotch spearmint oil in 2004, produced 1,050,700 pounds just five years later in 2009, a 65 percent increase.

To compound matters, in addition to increasing overproduction concerns, the demand for Far West Scotch spearmint oil began to actually decline over this period. Sales peaked in 2005 at 1,002,779 pounds, declining to 627,868 pounds in 2009. With production rising and sales dropping, excess inventory of uncommitted Scotch spearmint oil began to accumulate. Scotch spearmint oil carry-in (unsold salable quantity from prior years that is available for sale at the beginning of a new marketing year), which serves as a measure of oversupply in the market, grew from 23,141 pounds in 2007 to 431,028 pounds in 2010.

The Committee's response to the deteriorating marketing environment since 2008 has been to recommend the tightening of volume control regulations. The Committee, which recommended a 2008-2009 marketing year Scotch spearmint oil salable quantity of 993,067 pounds, dropped the recommendation to 802,067 pounds for the 2009-2010 marketing year, and to only 566,962 pounds for the 2010-2011 marketing year. Similarly, the recommended allotment percentage was reduced from 50 percent for the 2008-2009 period to 40 percent for 2009-2010, and down to just 28 percent for 2010-2011.

When the Committee met in October 2010 to consider volume regulation for the 2011-2012 marketing year, many of the previously mentioned negative marketing conditions still persisted. Even while showing some signs of incremental improvement, the current inventories, expected production, and projected demand of Scotch spearmint oil were all at levels considered unhealthy for the industry.

The Committee estimates that the carry-in of Scotch spearmint oil on June 1, 2011, the primary measure of excess supply, will be approximately 197,551 pounds. That quantity, while down from the previous year's high of 431,028 pounds, would still be above what the Committee considers to be optimum.

Overproduction of Scotch spearmint oil, while improving, also continues to be an area of concern for the Committee. Production of Far West Scotch spearmint oil has declined, from a high of 1,050,700 pounds in 2009, to 868,487 pounds in 2010, and the Committee expects it to drop even further during the 2011 season. The recent declining trend in Scotch spearmint oil production is viewed by the Committee as a positive development and is expected to contribute some relief to the industry's oversupply situation.

In addition, spearmint oil handlers indicated that demand for Scotch spearmint oil might be gaining strength. Handlers that had projected that the trade demand for Far West Scotch oil would range from a low of 750,000 pounds to a high of 850,000 pounds for the 2010-2011 marketing year, expect the trade demand to be within a range of 800,000 pounds to 900,000 pounds for the 2011-2012 period.

However, this increase in projected Scotch demand, generally thought of as a positive indicator for the industry, is viewed cautiously by some industry participants. Consumer demand for mint flavored products is reportedly steady, providing optimism for long term increases in the demand for Far West spearmint oil. Some handlers, though, believe that the manufacturers of such products are currently increasing spearmint oil purchases just to rebuild inventories that were depleted during the worst of the recent U.S. economic recession. As such, those handlers feel that at least some of the recent increase in Scotch spearmint oil sales may not represent an actual increase in sustained demand, but a temporary response to fluctuations in the strategic inventories of the manufacturers.

Still, given the moderately improving economic indicators for the Far West Scotch spearmint oil industry outlined above, the Committee took a cautiously optimistic perspective into the discussion of establishing appropriate salable quantities and allotment percentages for the upcoming season.

Therefore, at the October 13, 2010, meeting, the Committee recommended the 2011-2012 Scotch spearmint oil salable quantity of 694,774 pounds and allotment percentage of 34 percent. The Committee utilized sales estimates for 2011-2012 Scotch spearmint oil, as provided by several of the industry's handlers, as well as historical and current Scotch spearmint oil production and inventory statistics, to arrive at those recommendations. The volume control levels recommended by the Committee represent a 127,812 pound and 6 percentage point increase over the previous year's salable quantity and allotment percentage, reflecting a more positive assessment of the industry's economic conditions.

The Committee estimates that about 800,000 pounds of Scotch spearmint oil may be sold during the 2011-2012 marketing year. When considered in conjunction with the estimated carry-in of 197,551 pounds of Scotch spearmint oil on June 1, 2011, the recommended salable quantity of 694,774 pounds results in a total available supply of approximately 892,325 pounds of Scotch spearmint oil during the 2011-2012 marketing year. The Committee estimates that carry-in of Scotch spearmint oil into the 2012-2013 marketing year, which begins June 1, 2012, would be 92,325 pounds, a decrease of 105,226 pounds from the beginning of the 2011-2012 marketing year.

The Committee's stated intent in the use of marketing order volume control regulations for Scotch spearmint oil is to keep adequate supplies available to meet market needs and establish orderly marketing conditions. With that in mind, the Committee developed its recommendation for the proposed Scotch spearmint oil salable quantity and allotment percentage for the 2011-2012 marketing year based on the information discussed above, as well as the data outlined below.

(A) Estimated carry-in on June 1, 2011—197,551 pounds. This figure is the difference between the revised 2010-2011 marketing year total available supply of 997,551 pounds and the estimated 2010-2011 marketing year trade demand of 800,000 pounds.

(B) Estimated trade demand for the 2011-2012 marketing year—800,000 pounds. This figure is based on input from producers at six Scotch spearmint oil production area meetings held in late September and early October 2010, as well as estimates provided by handlers and other meeting participants at the October 13, 2010, meeting. The average estimated trade demand provided at the six production area meetings is 800,000 pounds, which is 33,333 pounds less than the average of the trade demand estimates submitted by handlers. The average of Far West Scotch spearmint oil sales over the last five years is 789,243 pounds.

(C) Salable quantity required from the 2011-2012 marketing year production—602,449 pounds. This figure is the difference between the estimated 2011-2012 marketing year trade demand (800,000 pounds) and the estimated carry-in on June 1, 2011 (197,551 pounds). This figure represents the minimum salable quantity that may be needed to satisfy estimated demand for the coming year with no carryover.

(D) Total estimated allotment base for the 2011-2012 marketing year—2,043,453 pounds. This figure represents a one percent increase over the revised 2010-2011 total allotment base. This figure is generally revised each year on June 1 due to producer base being lost because of the bona fide effort production provisions of § 985.53(e). The revision is usually minimal.

(E) Computed allotment percentage—29.5 percent. This percentage is computed by dividing the minimum required salable quantity by the total estimated allotment base.

(F) Recommended allotment percentage—34 percent. This is the Committee's recommendation and is based on the computed allotment percentage (29.5 percent), the average of the computed allotment percentage figures from the six production area meetings (31 percent), and input from producers and handlers at the October 13, 2010, meeting. The actual recommendation of 34 percent is based on the Committee's determination that the computed percentage (29.5 percent) may not adequately supply the potential 2011-2012 Scotch spearmint oil market.

(G) The Committee's recommended salable quantity—694,774 pounds. This figure is the product of the recommended allotment percentage and the total estimated allotment base.

(H) Estimated available supply for the 2011-2012 marketing year—892,325 pounds. This figure is the sum of the 2011-2012 recommended salable quantity (694,774 pounds) and the estimated carry-in on June 1, 2011 (197,551 pounds).

The Native spearmint oil industry is facing market conditions that are very similar to those affecting the Scotch spearmint oil market, although not nearly as severe. Over 90 percent of U.S. production of Native spearmint oil is produced within the Far West production area, thus domestic production outside this area is not a major factor in the marketing of Far West Native spearmint oil. This has been an attribute of U.S. production since the order's inception. A minor amount of domestic Native spearmint oil is produced outside of the Far West region in the States of Indiana, Michigan, Minnesota, Montana, North Dakota, South Dakota, and Wisconsin.

According to the Committee, very little true Native spearmint oil is produced outside of the United States. However, India produces an increasing quantity of spearmint oil with qualities very similar to Native spearmint oil. Committee records show that in 1996 the Far West accounted for nearly 93 percent of the global sales of Native or Native quality spearmint oil. By 2008 that share had shrunk to a low of 48 percent. Since that point, however, the percentage has rebounded and is now estimated to be over 57 percent for 2010.

In spite of the fact that Far West Native spearmint oil has been gaining world market share, the industry has endured challenging marketing conditions over the past several marketing years. Overproduction, coupled with a decrease in demand, created a similar oversupply situation for Native spearmint oil as was previously discussed for Scotch spearmint oil. Production of Native spearmint oil in the Far West region was 701,372 pounds in 2004, but increased to 1,453,896 pounds just five years later in 2009, a 107 percent increase. In addition, over that same timeframe, demand for Native oil was moving in the opposite direction. Sales of Far West Native oil peaked in 2004 at 1,249,507 pounds. From that cyclical high, sales steadily declined over the next five years, dropping to just 976,888 pounds by 2009. As production rose and sales dropped, excess inventory of uncommitted Native spearmint oil began to accumulate. Carry-in of Native oil measured at the beginning of each marketing year, which serves as a measure of oversupply in the market, grew from 83,417 pounds at the beginning of the 2007-2008 marketing year to 343,517 pounds at the beginning of the 2010-2011 marketing year.

The Committee's response to the difficult marketing environment for Native spearmint oil over the 2008 through 2010 period was similar to the response to the situation with Scotch spearmint oil over that time, to recommend the moderate tightening of volume control regulations. The Committee, which recommended a 2008-2009 Native spearmint oil salable quantity of 1,178,946 pounds, maintained a similar recommendation for the 2009-2010 marketing year and then dropped its recommendation to 953,405 pounds for the 2010-2011 marketing year. Similarly, the recommended allotment percentage, which was 53 percent for the 2008-2009 and 2009-2010 periods, was recommended to be reduced to just 43 percent for 2010-2011.

Although improving, many of the negative marketing conditions present leading up to the the 2010-2011 marketing year were still evident when the Committee met to consider volume regulation for the upcoming 2011-2012 marketing year. The June 1, 2011, carry-in of Native spearmint oil on June 1, 2011, is estimated to be 216,737 pounds, down from the previous year's high of 343,517 pounds, but still at a level above what the Committee believes to be optimum.

Also, production of Native spearmint oil, while showing some signs of improvement, still remains an area of concern for the Committee. Production of Far West Native spearmint oil, which declined from a high of 1,453,896 pounds in 2009 to 1,244,361 pounds in 2010, is still considered by the Committee to be high relative to the current level of demand and the excess inventory of Native spearmint oil. However, the Committee believes that the declining trend in Native spearmint oil production may continue into the 2011 season and that much of the pressure on the industry's current oversupply situation may be relieved moving forward.

In addition to an improved supply situation, demand for Far West Native spearmint oil appears to have halted its downward movement and is expected to improve in the coming year. Spearmint oil handlers, who projected that the 2010-2011 trade demand for Far West Native spearmint oil would range from a low of 1,050,000 pounds to a high of 1,200,000 pounds, have increased their projections modestly for the 2011-2012 period to a range of 1,100,000 pounds to 1,200,000 pounds.

However, similar to Scotch spearmint oil, the small increase in projected Native spearmint oil demand, generally thought of as a positive indicator for the industry, is viewed by some handlers with caution. As mentioned previously, consumer demand for mint flavored products is expected to be steady or increase slightly moving forward, which provides optimism for long term improvement in the demand for Far West spearmint oil. Some handlers, though, have reported that the manufacturers of such products may just be temporarily increasing purchases of spearmint oil to rebuild inventories that were depleted during the worst of the current U.S. economic recession. As such, the handlers believe that at least some of the recent increase in purchases do not represent an actual increase in sustained demand but, rather, a short term response to fluctuations in the strategic inventories of the manufacturers.

Given the moderately improving economic indicators for the Far West Native spearmint oil industry outlined above, the Committee took a cautiously optimistic perspective into the discussion of establishing appropriate salable quantities and allotment percentages for the upcoming season.

As such, at the October 13, 2010, meeting, the Committee recommended a 2011-2012 Native spearmint oil salable quantity of 1,012,983 pounds and an allotment percentage of 44 percent. The Committee utilized sales estimates for 2011-2012 Native spearmint oil, as provided by several of the industry's handlers, as well as historical and current Native spearmint oil market statistics to establish these thresholds. The recommended volume control levels represent a 32,763 pound and a 1 percentage point increase over the previous year's salable quantity and allotment percentage. Even with these increases in the salable quantity and allotment percentages, the carry-in at the beginning of the 2012-2013 marketing year is projected to drop by 117,018 pounds.

The Committee estimates that approximately 1,130,000 pounds of Native spearmint oil may be sold during the 2011-2012 marketing year. When considered in conjunction with the estimated carry-in of 216,737 pounds of Native spearmint oil on June 1, 2011, the recommended salable quantity of 1,012,983 pounds results in a total available supply of about 1,229,719 pounds of Native spearmint oil during the 2011-2012 marketing year. The Committee estimates that carry-in of Native spearmint oil at the beginning of the 2012-2103 marketing year to be 99,719 pounds, a significant reduction from the previous year's level of 216,737 pounds.

The Committee's stated intent in the use of marketing order volume control regulations for Native spearmint oil is to keep adequate supplies available to meet market needs and establish orderly marketing conditions. With that in mind, the Committee developed its recommendation for the proposed Native spearmint oil salable quantity and allotment percentage for the 2011-2012 marketing year based on the information discussed above, as well as the data outlined below.

(A) Estimated carry-in on June 1, 2011—216,737 pounds. This figure is the difference between the revised 2010-2011 marketing year total available supply of 1,323,737 pounds and the estimated 2010-2011 marketing year trade demand of 1,107,000 pounds.

(B) Estimated trade demand for the 2011-2012 marketing year—1,130,000 pounds. This estimate is established by the Committee and is based on input from producers at the seven Native spearmint oil production area meetings held in late September and early October 2010, as well as estimates provided by handlers and other meeting participants at the October 13, 2010, meeting. The average estimated trade demand provided at the seven production area meetings was 1,130,238 pounds, whereas the handler estimate ranged from 1,100,000 pounds to 1,200,000 pounds.

(C) Salable quantity required from the 2011-2012 marketing year production—913,263 pounds. This figure is the difference between the estimated 2011-2012 marketing year trade demand (1,130,000 pounds) and the estimated carry-in on June 1, 2011 (216,737 pounds). This is the minimum amount that the Committee believes would be required to meet the anticipated 2011-2012 Native spearmint oil trade demand.

(D) Total estimated allotment base for the 2011-2012 marketing year—2,302,233 pounds. This figure represents a one percent increase over the revised 2010-2011 total allotment base. This figure is generally revised each year on June 1 due to producer base being lost due to the bona fide effort production provisions of § 985.53(e). The revision is usually minimal.

(E) Computed allotment percentage—39.7 percent. This percentage is computed by dividing the required salable quantity (913,263 pounds) by the total estimated allotment base (2,302,233 pounds).

(F) Recommended allotment percentage—44 percent. This is the Committee's recommendation based on the computed allotment percentage (39.7 percent), the average of the computed allotment percentage figures from the seven production area meetings (39.7 percent), and input from producers and handlers at the October 13, 2010, meeting. The actual recommendation of 44 percent is based on the Committee's determination that the computed percentage (39.7 percent) may not adequately supply the potential 2011-2012 Native spearmint oil market.

(G) The Committee's recommended salable quantity—1,012,983 pounds. This figure is the product of the recommended allotment percentage (44 percent) and the total estimated allotment base (2,302,233 pounds).

(H) Estimated available supply for the 2011-2012 marketing year—1,229,720 pounds. This figure is the sum of the 2011-2012 recommended salable quantity (1,012,983 pounds) and the estimated carry-in on June 1, 2011 (216,737 pounds).

The salable quantity is the total quantity of each class of spearmint oil that handlers may purchase from, or handle on behalf of, producers during a marketing year. Each producer is allotted a share of the salable quantity by applying the allotment percentage to the producer's allotment base for the applicable class of spearmint oil.

The Committee's recommended Scotch and Native spearmint oil salable quantities and allotment percentages of 694,774 pounds and 34 percent, and 1,012,983 pounds and 44 percent, respectively, are based on the goal of establishing and maintaining market stability. The Committee anticipates that this goal would be achieved by matching the available supply of each class of Spearmint oil to the estimated demand of such, thus avoiding extreme fluctuations in inventories and prices.

The proposed salable quantities are not expected to cause a shortage of spearmint oil supplies. Any unanticipated or additional market demand for spearmint oil which might develop during the marketing year could be satisfied by an intra-seasonal increase in the salable quantity. The order makes this provision for an intra-seasonal increase to allow the Committee the flexibility to respond quickly to changing market conditions. In addition, producers who produce more than their annual allotments during the 2011-2012 marketing year may transfer such excess spearmint oil to producers with production less than their annual allotment, or, up until November 1, 2011, place it into the reserve pool to be released in the future in accordance with market needs.

This proposed regulation, if adopted, would be similar to regulations issued in prior seasons. The average allotment percentage for the five most recent marketing years for Scotch spearmint oil is 42 percent, while the average allotment percentage for the same five-year period for Native spearmint oil is 51 percent. Costs to producers and handlers resulting from this rule are expected to be offset by the benefits derived from a stable market and improved returns. In conjunction with the issuance of this proposed rule, USDA has reviewed the Committee's marketing policy statement for the 2011-2012 marketing year. The Committee's marketing policy statement, a requirement whenever the Committee recommends volume regulation, fully meets the intent of § 985.50 of the order.

During its discussion of potential 2011-2012 salable quantities and allotment percentages, the Committee considered: (1) The estimated quantity of salable oil of each class held by producers and handlers; (2) the estimated demand for each class of oil; (3) the prospective production of each class of oil; (4) the total of allotment bases of each class of oil for the current marketing year and the estimated total of allotment bases of each class for the ensuing marketing year; (5) the quantity of reserve oil, by class, in storage; (6) producer prices of oil, including prices for each class of oil; and (7) general market conditions for each class of oil, including whether the estimated season average price to producers is likely to exceed parity. Conformity with the USDA's “Guidelines for Fruit, Vegetable, and Specialty Crop Marketing Orders” has also been reviewed and confirmed.

The establishment of these salable quantities and allotment percentages would allow for anticipated market needs. In determining anticipated market needs, consideration by the Committee was given to historical sales, as well as changes and trends in production and demand. This rule also provides producers with information on the amount of spearmint oil that should be produced for the 2011-2012 season in order to meet anticipated market demand.

Pursuant to requirements set forth in the Regulatory Flexibility Act (RFA), the Agricultural Marketing Service (AMS) has considered the economic impact of this action on small entities. Accordingly, AMS has prepared this initial regulatory flexibility analysis.

The purpose of the RFA is to fit regulatory actions to the scale of business subject to such actions in order that small businesses will not be unduly or disproportionately burdened. Marketing orders issued pursuant to the Act, and the rules issued thereunder, are unique in that they are brought about through group action of essentially small entities acting on their own behalf.

There are eight spearmint oil handlers subject to regulation under the order, and approximately 38 producers of Scotch spearmint oil and approximately 84 producers of Native spearmint oil in the regulated production area. Small agricultural service firms are defined by the Small Business Administration (SBA) (13 CFR 121.201) as those having annual receipts of less than $7,000,000, and small agricultural producers are defined as those having annual receipts of less than $750,000.

Based on the SBA's definition of small entities, the Committee estimates that 2 of the 8 handlers regulated by the order could be considered small entities. Most of the handlers are large corporations involved in the international trading of essential oils and the products of essential oils. In addition, the Committee estimates that 19 of the 38 Scotch spearmint oil producers and 29 of the 84 Native spearmint oil producers could be classified as small entities under the SBA definition. Thus, a majority of handlers and producers of Far West spearmint oil may not be classified as small entities.

The Far West spearmint oil industry is characterized by producers whose farming operations generally involve more than one commodity, and whose income from farming operations is not exclusively dependent on the production of spearmint oil. A typical spearmint oil-producing operation has enough acreage for rotation such that the total acreage required to produce the crop is about one-third spearmint and two-thirds rotational crops. Thus, the typical spearmint oil producer has to have considerably more acreage than is planted to spearmint during any given season. Crop rotation is an essential cultural practice in the production of spearmint oil for weed, insect, and disease control. To remain economically viable with the added costs associated with spearmint oil production, a majority of spearmint oil-producing farms fall into the SBA category of large businesses.

Small spearmint oil producers generally are not as extensively diversified as larger ones and as such are more at risk from market fluctuations. Such small producers generally need to market their entire annual allotment and do not have the luxury of having other crops to cushion seasons with poor spearmint oil returns. Conversely, large diversified producers have the potential to endure one or more seasons of poor spearmint oil markets because income from alternate crops could support the operation for a period of time. Being reasonably assured of a stable price and market provides small producing entities with the ability to maintain proper cash flow and to meet annual expenses. Thus, the market and price stability provided by the order potentially benefit the small producer more than such provisions benefit large producers. Even though a majority of handlers and producers of spearmint oil may not be classified as small entities, the volume control feature of this order has small entity orientation.

This proposed rule would establish the quantity of spearmint oil produced in the Far West, by class that handlers may purchase from, or handle on behalf of, producers during the 2011-2012 marketing year. The Committee recommended this rule to help maintain stability in the spearmint oil market by matching supply to estimated demand thereby avoiding extreme fluctuations in supplies and prices. Establishing quantities to be purchased or handled during the marketing year through volume regulations allows producers to plan their spearmint planting and harvesting to meet expected market needs. The provisions of §§ 985.50, 985.51, and 985.52 of the order authorize this rule.

Instability in the spearmint oil sub-sector of the mint industry is much more likely to originate on the supply side than the demand side. Fluctuations in yield and acreage planted from season-to-season tend to be larger than fluctuations in the amount purchased by handlers. Demand for spearmint oil tends to be relatively stable from year-to-year. The demand for spearmint oil is expected to grow slowly for the foreseeable future because the demand for consumer products that use spearmint oil will likely expand slowly, in line with population growth.

Demand for spearmint oil at the farm level is derived from retail demand for spearmint-flavored products such as chewing gum, toothpaste, and mouthwash. The manufacturers of these products are by far the largest users of mint oil. However, spearmint flavoring is generally a very minor component of the products in which it is used, so changes in the raw product price have virtually no impact on retail prices for those goods.

Spearmint oil production tends to be cyclical. Years of relatively high production, with demand remaining reasonably stable, have led to periods in which large producer stocks of unsold spearmint oil have depressed producer prices for a number of years. Shortages and high prices may follow in subsequent years, as producers respond to price signals by cutting back production.

The significant variability of the spearmint oil market is illustrated by the fact that the coefficient of variation (a standard measure of variability; “CV”) of Far West spearmint oil production from 1980 through 2009 was about 0.23. The CV for spearmint oil grower prices was about 0.16 for that period, well below the CV for production. This provides an indication of the price stabilizing impact of the marketing order.

Production in the shortest marketing year was about 48 percent of the 30-year average (1.89 million pounds from 1980 through 2009) and the largest crop was approximately 163 percent of the 30-year average. A key consequence is that in years of oversupply and low prices the season average producer price of spearmint oil is below the average cost of production (as measured by the Washington State University Cooperative Extension Service.)

The wide fluctuations in supply and prices that result from this cycle, which was even more pronounced before the creation of the marketing order, can create liquidity problems for some producers. The marketing order was designed to reduce the price impacts of the cyclical swings in production. However, producers have been less able to weather these cycles in recent years because of the increase in production costs. While prices have been relatively steady, the cost of production has increased to the extent that plans to plant spearmint may be postponed or changed indefinitely. Producers are also enticed by the prices of alternative crops and their lower cost of production.

In an effort to stabilize prices, the spearmint oil industry uses the volume control mechanisms authorized under the order. This authority allows the Committee to recommend a salable quantity and allotment percentage for each class of oil for the upcoming marketing year. The salable quantity for each class of oil is the total volume of oil that producers may sell during the marketing year. The allotment percentage for each class of spearmint oil is derived by dividing the salable quantity by the total allotment base.

Each producer is then issued an annual allotment certificate, in pounds, for the applicable class of oil, which is calculated by multiplying the producer's allotment base by the applicable allotment percentage. This is the amount of oil of each applicable class that the producer can sell.

By November 1 of each year, the Committee identifies any oil that individual producers have produced above the volume specified on their annual allotment certificates. This excess oil is placed in a reserve pool administered by the Committee.

There is a reserve pool for each class of oil that may not be sold during the current marketing year unless USDA approves a Committee recommendation to increase the salable quantity and allotment percentage for a class of oil and make a portion of the pool available. However, limited quantities of reserve oil are typically sold by one producer to another producer to fill deficiencies. A deficiency occurs when on-farm production is less than a producer's allotment. In that case, a producer's own reserve oil can be sold to fill that deficiency. Excess production (higher than the producer's allotment) can be sold to fill other producers' deficiencies. All of these provisions need to be exercised prior to November 1 of each year.

In any given year, the total available supply of spearmint oil is composed of current production plus carry-over stocks from the previous crop. The Committee seeks to maintain market stability by balancing supply and demand, and to close the marketing year with an appropriate level of carryout. If the industry has production in excess of the salable quantity, then the reserve pool absorbs the surplus quantity of spearmint oil, which goes unsold during that year, unless the oil is needed for unanticipated sales.

Under its provisions, the order may attempt to stabilize prices by (1) limiting supply and establishing reserves in high production years, thus minimizing the price-depressing effect that excess producer stocks have on unsold spearmint oil, and (2) ensuring that stocks are available in short supply years when prices would otherwise increase dramatically. The reserve pool stocks, which are increased in large production years, are drawn down in years where the crop is short.

An econometric model was used to assess the impact that volume control has on the prices producers receive for their commodity. Without volume control, spearmint oil markets would likely be over-supplied, resulting in low producer prices and a large volume of oil stored and carried over to the next crop year. The model estimates how much lower producer prices would likely be in the absence of volume controls.

The Committee estimated the trade demand for the 2011-2012 marketing year for both classes of oil at 1,930,000 pounds, and that the expected combined carry-in will be 414,288 pounds. This results in a combined required salable quantity of 1,515,712 pounds. With volume control, sales by producers for the 2011-2012 marketing year would be limited to 1,707,757 pounds (the recommended salable quantity for both classes of spearmint oil).

The recommended allotment percentages, upon which 2011-2012 producer allotments are based, are 34 percent for Scotch and 44 percent for Native. Without volume controls, producers would not be limited to these allotment levels, and could produce and sell additional spearmint. The econometric model estimated a $1.89 decline in the season average producer price per pound (from both classes of spearmint oil) resulting from the higher quantities that would be produced and marketed without volume control. The surplus situation for the spearmint oil market that would exist without volume controls in 2011-2012 also would likely dampen prospects for improved producer prices in future years because of the buildup in stocks.

The use of volume controls allows the industry to fully supply spearmint oil markets while avoiding the negative consequences of over-supplying these markets. The use of volume controls is believed to have little or no effect on consumer prices of products containing spearmint oil and will not result in fewer retail sales of such products.

The Committee discussed alternatives to the recommendations contained in this rule for both classes of spearmint oil. The Committee discussed and rejected the idea of recommending that there not be any volume regulation for both classes of spearmint oil because of the severe price-depressing effects that would occur without volume control.

After computing the initial 29.5 percent Scotch spearmint oil allotment percentage, the Committee considered various alternative levels of volume control for Scotch spearmint oil. Considered levels ranged from 30 percent to 40 percent. Given the moderately improving marketing conditions, there was consensus that the allotment percentage for 2011-2012 should be more than the percentage established for the 2010-2011 marketing year (28 percent). After considerable discussion, in a vote of six members in favor and two members opposed, the Committee determined that 694,774 pounds and 34 percent would be the most effective salable quantity and allotment percentage, respectively, for the 2011-2012 marketing year. The two dissenting members felt that the salable quantity and allotment percentage should be set at some unidentified higher level.

The Committee was also able to reach a consensus regarding the level of volume control for Native spearmint oil. After first determining the computed allotment percentage at 39.7 percent, the Committee voted unanimously to recommend 1,012,983 pounds and 44 percent for the effective salable quantity and allotment percentage, respectively, for the 2011-2012 marketing year.

As noted earlier, the Committee's recommendation to establish salable quantities and allotment percentages for both classes of spearmint oil was made after careful consideration of all available information, including: (1) The estimated quantity of salable oil of each class held by producers and handlers; (2) the estimated demand for each class of oil; (3) the prospective production of each class of oil; (4) the total of allotment bases of each class of oil for the current marketing year and the estimated total of allotment bases of each class for the ensuing marketing year; (5) the quantity of reserve oil, by class, in storage; (6) producer prices of oil, including prices for each class of oil; and (7) general market conditions for each class of oil, including whether the estimated season average price to producers is likely to exceed parity. Based on its review, the Committee believes that the salable quantity and allotment percentage levels recommended would achieve the objectives sought.

Without any regulations in effect, the Committee believes the industry would return to the pronounced cyclical price patterns that occurred prior to the order, and that prices in 2011-2012 could decline substantially below current levels.

According to the Committee, the recommended salable quantities and allotment percentages are expected to facilitate the goal of establishing orderly marketing conditions for Far West spearmint oil.

As previously stated, annual salable quantities and allotment percentages have been issued for both classes of spearmint oil since the order's inception. Reporting and recordkeeping requirements have remained the same for each year of regulation. These requirements have been approved by the Office of Management and Budget under OMB Control No. 0581-0178, Vegetable and Specialty Crops. Accordingly, this rule would not impose any additional reporting or recordkeeping requirements on either small or large spearmint oil producers or handlers. As with all Federal marketing order programs, reports and forms are periodically reviewed to reduce information requirements and duplication by industry and public sector agencies. Furthermore, USDA has not identified any relevant Federal rules that duplicate, overlap, or conflict with this rule.

AMS is committed to complying 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.

In addition, the Committee's meeting was widely publicized throughout the spearmint oil industry and all interested persons were invited to attend the meeting and participate in Committee deliberations on all issues. Like all Committee meetings, the October 13, 2010, meeting was a public meeting and all entities, both large and small, were able to express views on this issue. Finally, interested persons are invited to submit comments on this proposed rule, including the regulatory and informational impacts of this action on small businesses.

A small business guide on complying with fruit, vegetable, and specialty crop marketing agreements and orders may be viewed at: http://www.ams.usda.gov/MarketingOrdersSmallBusinessGuide. Any questions about the compliance guide should be sent to Antoinette Carter at the previously mentioned address in the FOR FURTHER INFORMATION CONTACT section.

A 30-day comment period is deemed appropriate to allow interested persons the opportunity to respond to this proposal, taking into account that the marketing year begins on June 1, 2011. All written comments timely received will be considered before a final determination is made on this matter.

For the reasons set forth in the preamble, 7 CFR part 985 is proposed to be amended as follows:

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal.

Communications should identify both docket numbers (FAA Docket No. FAA-2011-0010 and Airspace Docket No. 11-AAL-1) and be submitted in triplicate to the Docket Management Facility ( see ADDRESSES section for address and phone number). You may also submit comments through the Internet at http://www.regulations.gov.

Commenters wishing the FAA to acknowledge receipt of their comments on this action must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to FAA Docket No. FAA-2011-0010 and Airspace Docket No. 11-AAL-1.” The postcard will be date/time stamped and returned to the commenter.

All communications received on or before the specified closing date for comments will be considered before taking action on the proposed rule. The proposal contained in this action may be changed in light of comments received. All comments submitted will be available for examination in the public docket both before and after the closing date for comments. A report summarizing each substantive public contact with FAA personnel concerned with this rulemaking will be filed in the docket.

An electronic copy of this document may be downloaded through the Internet at http://www.regulations.gov. Recently published rulemaking documents can also be accessed through the FAA's web page at http://www.faa.gov/air_traffic/publications/airspace_amendments/.

You may review the public docket containing the proposal, any comments received and any final disposition in person in the Dockets Office ( see ADDRESSES section for address and phone number) between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Alaskan Service Center, Operations Support Group, Federal Aviation Administration, 222 West 7th Avenue, Box 14, Anchorage, AK 99513.

Persons interested in being placed on a mailing list for future NPRMs should contact the FAA's Office of Rulemaking, (202) 267-9677, for a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

The Anchorage VOR, located on Fire Island, is one of the navigation aids used to form points along numerous Federal airways in Alaska. Due to construction of wind turbines on Fire Island, AK, the Anchorage VOR is being relocated to Ted Stevens Anchorage International Airport and renamed. In addition, the equipment is being upgraded to a DOPPLER VOR/distance measuring equipment (VOR/DME) facility that would improve coverage and reliability. Due to the relocation, the published radials from the old Anchorage VOR/DME, as used in each route description, will change by several degrees.

The FAA is proposing an amendment to Title 14 Code of Federal Regulations (14 CFR) part 71 to amend Federal airways that currently use the Anchorage (ANC) VOR located on Fire Island, AK. The ANC VOR is being upgraded to a Doppler VOR and redesignated as the Anchorage (TED) VOR. The Doppler VOR will be located on the Ted Stevens Anchorage International Airport property. This action would affect 15 Low Altitude Federal airways (Victor Airways and T-Routes), and 14 High Altitude Federal airways (Jet Routes and Q-Routes). In addition to these airways using the TED VOR as the new reference point, the descriptions would be adjusted, where necessary, to show new radials to describe airway intersections.

VOR Federal airways, United States Area Navigation Routes (low), Jet Routes, Alaska Area Navigation Routes, and United States Area Navigation Routes (high), are published in paragraphs 6010, 6011, 2004, 2005, and 2006, respectively, of FAA Order 7400.9U, dated August 18, 2010 and effective September 15, 2010, which is incorporated by reference in 14 CFR 71.1. The Federal Airways listed in this document will be published subsequently in the Order.

The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. Therefore, this proposed regulation: (1) Is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under Department of Transportation (DOT) Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this proposed rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. 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.

This rulemaking is promulgated under the authority described in subtitle VII, part A, subpart I, section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of the airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it amends Federal airways in Alaska.

This proposal will be subject to an environmental analysis in accordance with FAA Order 1050.1E, “Environmental Impacts: Policies and Procedures,” prior to any FAA final regulatory action.

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

Today's document does not contain or establish any regulatory requirements. Rather, it announces public listening sessions and seeks public input for use in developing proposed regulations under the CWA Section 312(o).

Today's document will be of interest to the general public, State regulatory agencies, other Federal agencies, environmental groups, and owners or operators of recreational vessels.

1. Submitting CBI. Do not submit this information to EPA through http://www.regulations.gov or e-mail. Clearly mark the part or all of the information that you claim to be CBI. For CBI information on a disk or CD-ROM that you mail to EPA, mark the outside of the disk or CD-ROM as CBI and then identify electronically within the disk or CD-ROM the specific information that is claimed as CBI. In addition to one complete version of the comment that includes information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public docket. Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2.

2. Tips for Preparing Your Comments. When submitting comments, remember to:

• Identify the document by docket number and other identifying information (subject heading, Federal Register date, and page number).

• Follow directions.

• Describe any assumptions and provide any technical information and/or data that you used.

• Provide specific examples to illustrate your concerns and suggest alternatives.

• Explain your views as clearly as possible and provide reasons to support your views.

The potential environmental impacts from discharges incidental to the normal operation of recreational vessels are broad. Recreational boating activities can introduce non-indigenous invasive species to new aquatic environments through the discharge of encrusting organisms from boat hulls, boat trailers, fishing gear, and through water retained by live wells and fishing buckets, recreational gear, ballast water, and bilge water. Boating activities can also introduce toxic chemicals and other pollutants. For example, graywater discharges from the vessel galley, sinks, or showers can contribute to eutrophication, enhanced turbidity, and introduce pathogenic organisms to the surrounding water. Coatings used to deter organism growth on vessel hulls can release heavy metals and/or other biocides, which can lead to acute or chronic toxicity in non-targeted organisms. Bilgewater can contain oils, dissolved heavy metals, and other chemical constituents that can result in toxic effects on aquatic organisms, contribute to eutrophication, and have negative aesthetic impacts.

The CBA creates a new section 402(r) of the CWA to exclude recreational vessels from National Pollutant Discharge Elimination System permitting requirements. In addition, it adds a new CWA section 312(o) directing EPA to develop regulations that identify the discharges incidental to the normal operation of recreational vessels (other than a discharge of sewage), for which it is reasonable and practicable to develop management practices to mitigate adverse impacts on waters of the United States. Those regulations need to include management practices, as well as performance standards for each such practice. Following promulgation of the EPA performance standards, new CWA section 312(o) directs the United States Coast Guard (USCG) to promulgate regulations governing the design, construction, installation, and use of the management practices. Following promulgation of the USCG regulations, new CWA section 312(o)(6) prohibits the operation of a recreational vessel or any discharge incidental to their normal operation in waters of the United States and waters of the contiguous zone (i.e., 12 miles into the ocean), unless the vessel owner or operator is using an applicable management practice meeting the EPA-developed performance standards.

To be successful, the management practices and performance standards to be developed under the Act will need to be technically effective in reducing or controlling discharges, but also will need to be readily implemented by the recreational boat owner.

To help the public prepare for the listening session, the following background information is provided. Please note that the information presented in this section is in summary form; for more detail, please refer to the information available at http://water.epa.gov/lawsregs/lawsguidance/cwa/vessel/CBA/about.cfm.

In July of 2008, Congress passed the Clean Boating Act of 2008 (Pub. L. 110-288). The CBA directs EPA to promulgate regulations to establish management practices and associated standards of performance for discharges incidental to the normal operation of recreational vessels.

The CBA defines recreational vessels as vessels: (1) Manufactured primarily for pleasure, (2) used primarily for pleasure, or (3) vessels leased, rented, or chartered for pleasure (CWA section 502(25)). The definition specifically excludes vessels that are subject to USCG inspection and either engaged in commercial use or carry paying passengers. EPA anticipates that the proposed regulation will apply to recreational vessels including, but not limited to: personal watercraft, canoes, kayaks, recreational fishing boats, sail boats, ski boats, power boats and large yachts.

EPA anticipates the proposed regulation will consist of a number of MPs that will describe practices to reduce environmental pollution from recreational vessels. Each vessel owner/operator would be responsible for implementing the MPs applicable to the types of discharges their vessel creates. The owner/operator is not responsible for those MPs for discharges that their vessel does not create (for example, a sailboat owner is not responsible for the engine maintenance MPs if the sailboat does not have an engine).

At this time, we are only seeking public input to assist us in developing the regulations. Under the CBA, the regulations are to be developed in three phases: Phase 1, EPA develops MPs for incidental discharges from recreational vessels; Phase 2, EPA develops performance standards for the MPs; and Phase 3, USCG develops regulations requiring use of the MPs. Following promulgation of the USCG Phase 3 regulations, discharges incidental to the normal operation of recreational vessels into waters of the United States or the contiguous zone that are not in accordance with the management practices and performance standards will be prohibited. Violations of the CWA section 312(o) regulations will be subject to fines under the CWA.

The regulations will be enforceable upon finalization of the Phase 3 regulations by the USCG. The USCG will be the Federal agency enforcing MPs and performance standards. Relevant State agencies can, at their discretion, also enforce these practices and standards under CWA section 312(j) and 312(k).

Today's document is being issued to inform the public that EPA is in the process of developing regulations under the CWA section 312(o) and to solicit input from the public. EPA is accepting information during the listening sessions scheduled for March 18 and April 29, 2011, and/or by submission of written comments or relevant information to gain early public input on development of the MPs. Additionally, EPA will be conducting a series of weekly “webinars” to facilitate public participation. More information about the webinar series can be found at http://water.epa.gov/lawsregs/lawsguidance/cwa/vessel/CBA/. EPA is also seeking input from the public on whether to hold additional listening sessions in other locations ( e.g., Gulf of Mexico, Great Lakes region, and West Coast).

In addition to requesting recommendations for MPs that should be considered for inclusion in the forthcoming proposed rule, EPA is specifically requesting comment on the following:

(1) Are there any guidances, supporting documentation, or communication strategies that you would recommend EPA develop to help vessel owner/operators better understand and comply with the MPs being developed by EPA? If so, please suggest your approaches.

(2) Are there specific discharges ( e.g., ballast water) or broad categories of discharges ( e.g., oily wastes) for which EPA should consider developing MPs?

(3) Are there specific effluent limitations or best management practices that EPA should consider incorporating into the forthcoming regulations? If so, please provide the recommendation and any supporting information.

(4) Are there relevant Federal, State, or international permits, rules, or guidances EPA should consider using to inform decisions being made for the CWA section 312(o)? If so, please identify the specific sections of the permits, rules, or guidances you believe EPA should consider.

On January 4, 2011, the Pennsylvania Department of Environmental Protection (PADEP) submitted to EPA a SIP revision concerning the adoption of the CTG for paper, film, and foil surface coating processes.

Section 172(c)(1) of the CAA provides that SIPs for nonattainment areas must include reasonably available control measures (RACM), including RACT for sources of emissions. Section 182(b)(2)(A) provides that for certain nonattainment areas, states must revise their SIPs to include RACT for sources of volatile organic compounds (VOC) emissions covered by a CTG document issued after November 15, 1990 and prior to the area's date of attainment.

CTGs are intended to provide state and local air pollution control authorities information that should assist them in determining RACT for VOCs from various sources, including paper, film, and foil coatings. In developing these CTGs, EPA, among other things, evaluated the sources of VOC emissions from this industry and the available control approaches for addressing these emissions, including the costs of such approaches. Based on available information and data, EPA provided recommendations for RACT for VOCs from paper, film, and foil coatings.

In December 1977, EPA published a CTG for surface coating of paper (EPA-450/2-77-008). This CTG discusses the nature of VOC emissions from this industry, available control technologies for addressing such emissions, the costs of available control options, and other items. EPA promulgated national standards of performance for new stationary sources (NSPS) for the paper, foil, and film industry and EPA also published a national emission standard for hazardous air pollutants (NESHAP) for this industry.

In 2006 and 2007, after conducting a review of currently existing state and local VOC emission reduction approaches for the paper, foil, and film industry, reviewing the 1977/1978 CTG and the NESHAP for this industry, and taking into account the information that has become available since then, EPA developed a new CTG surface coating for paper, entitled Control Techniques Guidelines for Paper, Film, and Foil Coatings (Publication No. EPA 453/R-07-003; September 2007).

The paper, film, and foil product category includes coatings that are applied to paper, film, or foil surfaces in the manufacturing of several major product types for the following industry sectors: Pressure sensitive tape and labels; photographic film; industrial and decorative laminates; abrasive products; and flexible packaging. The category also includes coatings applied during miscellaneous coating operations for several products including: Corrugated and solid fiber boxes; die-cut paper paperboard and cardboard; converted paper and paperboard not elsewhere classified; folding paperboard boxes, including sanitary boxes; manifold business forms and related products; plastic asceptic packaging; and carbon paper and inked ribbons. VOC emissions from paper, film, or foil surface coating processes result from the evaporation of the components of the coatings and cleaning materials.

On January 4, 2011, PADEP submitted to EPA a SIP revision concerning the adoption of the EPA paper, film, and foil surface coating processes. EPA develops CTGs as guidance on control requirements for source categories. States can follow the CTGs or adopt more restrictive standards. Pennsylvania has adopted EPA's CTG standards for paper, film, and foil surface coating processes. These regulations are in Chapter 121—General Provisions, and in Chapter 129—Standards for Sources, in Title 25 of the Pennsylvania Code. Specifically, this revision amends the existing regulations at sections 121.1, 129.51 and 129.52 and adds new section 129.52b. Several definitions were amended or added in section 121.1 and section 129.52 was amended to extend coverage to paper, film, and foil surface coating processes. New section 129.52b includes VOC emission limits, work practices, and recordkeeping and reporting requirements, all of which are consistent with EPA's CTG for paper, film, and foil surface coating processes. The requirements in section 129.52b supersede the requirements in 129.52 relating to control of VOC emissions from paper, film, and foil surface coating processes. The emission limits of VOCs for paper, film, and foil surface coatings are shown in Table 1. These emission limits apply if potential VOC emissions from a single line, prior to control, are 25 tons per year (tpy) or more.

Additionally, VOC emission limits for paper coatings only and the associated applicability criteria that were in section 129.52(a)(2) were added to section 129.52(b) in order to carry forward previously regulated paper coating sources and to eliminate the potential for backsliding. These VOC emission limits apply only to paper coatings if actual VOC emissions have exceeded 3 pounds per hour, 15 pounds per day or 2.7 tpy in any year since January 1, 1987. The emission limits are shown in Table 2.

EPA is proposing to approve the Pennsylvania's SIP revision for adoption of the CTG standards for paper, film, and foil surface coating processes. EPA is soliciting public comments on the issues discussed in this document. These comments will be considered before taking final action.

Under the CAA, the Administrator is required to approve a SIP submission that complies with the provisions of the CAA and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely proposes to approve state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this proposed action:

• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Order 12866 (58 FR 51735, October 4, 1993);

• Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq. );

• Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. );

• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

• Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

• Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

• Is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and

• Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

In addition, this proposed rule concerning Pennsylvania's adoption of a CTG for paper, film, and foil surface coating processes does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law.

DoD published a proposed rule in the Federal Register on December 22, 2010 (75 FR 80427). DoD published an extension of the public comment period on February 18, 2011 (75 FR 9527). The public comment period ends on April 8, 2011.

DOE is proposing to amend parts 908, Required Sources of Supplies and Services, 945, Government Property, and related 970, Management and Operating Contracts, to remove out-of-date coverage, to update references and to conform to the FAR.

Part 945 is amended to conform to FAR Part 45, Government Property. On May 15, 2007 (72 FR 27364), in the Federal Acquisition Circular (FAC) 2005-17, FAR Part 45 was amended to simplify procedures, clarify language, and eliminate out-of-date requirements related to the management and disposition of Government property in the possession of contractors by establishing a life-cycle approach to property management and sanctioning the use of consensus standards or industry-leading standards and practices for property management. The FAC deleted outdated clauses and combined selected FAR property clauses into a single clause. This proposed rule updates corresponding DEAR sections to conform to the FAR and other federal agencies' procedures. None of these changes are substantive or of a nature to cause any significant expense for DOE or its contractors.

DOE proposes to amend the DEAR as follows:

1. Section 908.1102 is amended by redesignating paragraph (a)(4) as 908.1102-70 Vehicle leasing to conform to the FAR convention, and adding the phrase “All subsequent lease renewals or extensions may be exercised only when General Service Administration (GSA) has advised that it cannot furnish the vehicle(s) as prescribed herein.”

2. Section 908.1104(f) is amended by removing “Federal Property Management Regulation (FPMR) 41 CFR 101-38.6.” and adding in its place “Federal Management Regulation (FMR) 41 Code of Federal Regulation (CFR) 102-34.160, 102-34.175 and 102-34.80” to provide the updated citation.

3. Section 908.7101-2(a) is amended by removing “FPMR 41 CFR 101-25.304, 101-26.501, and 101-38.13 and DOE-PMR 41 CFR 109-25.304, 109-38.13, and 109-38.51” and adding in its place “Federal Property Management Regulations (FPMR) 41 CFR 101-26.501, and FMR 41 CFR 102-34, and Department of Energy-Property Management Regulations (DOE-PMR) 41 CFR 109-26.501” to provide the updated citation.

4. Section 908.7101-2 paragraph (b) is amended by removing “on GSA Form 1781, Motor Vehicle Requisition—Delivery Order—Invoice,” and adding in its place “utilizing GSA's on-line system (Auto Choice)” to update the procedures.

5. Section 908.7101-3 is amended by removing “those” in the third sentence and removing in the last sentence, “(See DOE-PMR 41 CFR 109-38.5102-4)” to correct grammar and to remove an out-of-date citation.

6. Section 908.7101-4 is amended in paragraph (a) by removing “FMPR 101-38.9 and DOE-PMR 41 CFR 109-38.9” and adding in its place “FMR 102-34.270” to update the citation.

7. Section 908.7101-5 is amended in the third sentence by removing “38.5102” and adding in its place “26.501-50 and 109-26.501-51,” to update the citation.

8. Section 908.7101-6 is amended in paragraph (a) by removing the last three sentences and adding in their place “Such forecast shall be submitted to the Property Executive, or designee, when requested.

9. Section 908.7101-6 is amended in paragraph (b) by removing “Sedans, station wagons, and light trucks requisitioned according to an approved forecast, but not contracted for by GSA until the subsequent fiscal year, will” and adding in its place “Approved sedans, station wagons, and light trucks requisitioned, but not contracted for by GSA until the subsequent fiscal year, shall” to update the procedures.

10. Section 908.7101-7 is amended in paragraph (a) by removing “101-38.303” and adding in its place “102-34.140” to update the citation.

11. Section 908.7101-7 is amended in paragraph (b) by removing in the second sentence the “,” after records; removing in the second sentence the “Director, Office of Property Management,” and adding in its place “Director, Personal Property Management Division,” to correct grammar and update office names.

12. Section 908.7101-7 is amended in paragraph (e) by removing the sentence and adding in its place “See DOE-PMR 41 CFR 109-38.202-2 and 109-38.202-3 for additional guidance.” to update the citation.

13. Section 908.7102 is amended by removing the sentence and adding in its place “Acquisition of aircraft shall be in accordance with FMR 41 CFR 102-33, subpart B and DOE Order 440.2B latest revision.” to update the citation.

14. Section 908.7103 is amended by removing “FPMR 41 CFR 101-25.104, 101-25.302, 101-25.302-3, 101-25.302-4, and 101-25.302-6, and 101-25.403, and DOE-PMR 41 CFR 109-25.302, 109-25.302-3, and 109-25.4” and by adding in its place “FPMR 41 CFR 101-25.104, 101-25.302, and DOE-PMR 41 CFR 109-25.302, and 109-25.4” to update the citations.

15. Section 908.7104 is amended by removing “FPMR 41 CFR 101-25.104, 101-25.302, 101-25.302-1, 101-25.302-5, 101-25.302-7, and 101-25.302-8, 101-25.404 and 101-26.505, and DOE-PMR 41 CFR 109-25.302, 109-25.302-1, and 109-25.350” and adding in its place “FPMR 41 CFR 101-25.104, 101-25.302, 101-25.302-5, 101-25.302-7, 101-25.404 and 101-26.505, and DOE-PMR 41 CFR 109-25.302, and 109-25.350” to update the citations.

16. Section 908.7121 is revised to update the first paragraph to clarify that the contracting officers shall require authorized contractors to follow procedures set forth in paragraphs (a) through (c).

17. Section 908.7121(b) Precious metals is revised to update the responsible office in subparagraph (1) and add subparagraph (2) to reference 945.604-1 for contractor identification and reporting for contractor inventory containing precious metals or possessing precious metals excess.

18. Section 908.7121(c) is amended to state that lithium is available from The National Nuclear Security Administration (NNSA), Y-12 National Security Complex in Oak Ridge, TN (Y-12) and that the excess quantities at Y-12 are to be the first source of supply.

19. Part 945 is amended to simplify procedures, clarify language, and eliminate obsolete requirements related to the management and disposition of Government property in the possession of contractors to conform to FAR Part 45 Government Property regulation.

20. Section 945.000 is amended by lower casing the first letter of the word “part”; by reversing “operating and management” to read “management and operating”; and by removing the second sentence in its entirety.

21. Section 945.101 is amended by removing the definition of capital equipment; and adding a definition of sensitive property. For clarity, since the FAR definition of sensitive property was changed under FAC 2005-17 and for further emphasis by DOE, the FAR definition is incorporated by reference.

22. Section 945.102-70 is revised in the first paragraph, first sentence, by removing “Within 30 days after the end of each fiscal year,” and adding in its place “The below listed information may be required to be reported from time to time to”; and by removing “Director, Office of Property Management,” and adding in its place “Personal Property Management Division”; in paragraph (e), by removing “dollar” and adding in its place “acquisition”; and in paragraph (e), by removing “as reported on last semiannual asset report (including date of report),”. These changes correct the reporting process and provide the correct title of the receiving activity. Changes pertain to the Property Information Database System (PIDS) which was created by the Idaho National Lab and has been in use since the late 1990s. The PIDS system is used by both DOE and Contractors alike.

23. Subpart 945.1 is revised to add the new section “945.102-72 Reporting of contractor sensitive property inventory” to reflect the current sensitive property policy.

24. Section 945.3 is amended by redesignating subpart 945.3 and section 945.303-1 as section 945.170 and section 945.170-1, respectively, and by reserving section 945.3 and by using lower case letters for “property” and “contractors” in the section 945.170 title, and by adding a period at the end of “contractors”. These changes are made to conform to the FAR.

25. Subpart 945.4 is amended by removing and reserving this subpart in its entirety to conform to the FAR.

26. Section 945.5 title is amended by removing “Management of Government Property in the Possession of Contractors” and adding in its place “Support Government Property Administration” to conform to the FAR.

27. Section 945.505-11 is removed in its entirety to conform to the FAR.

28. Subpart 945.5 is revised by changing its title to “945.570 Management of Government property in the possession of contractors” to conform to the FAR.

29. Section 945.506 is removed in its entirety.

30. Section 945.570-2 is redesignated as 945.570-1 and is amended at paragraph (c) the second sentence by removing “(GSA Form 1781)”, and adding “via GSA Autochoice” after “should be processed”. The replaced information updates the DEAR to conform to GSA's current procedures.

31. Redesignated 945.570-1(f) is amended by removing “Motor Vehicle Rental” and adding in its place “Leasing of Automobiles and Light Trucks”.

32. Section 945.570-7 is redesignated as 945.570-2.

33. Section 945.570-8 is redesignated as 945.570-3 and is revised in section (a) in the first sentence, by removing “(on or before December 1)”.

34. Redesignated 945.570-3(b) is amended after “DOE-owned” by adding “, GSA leased”; before “and/or” and by adding “electronically” before “submit”.

35. Redesignated 945.570-3(b)(1) is amended by removing “DOE Report of Motor Vehicle Data (passenger vehicles)” and adding in its place “Annual Motor Vehicle Fleet Report”.

36. Redesignated section 945.570-3(b)(2) is amended by removing “DOE Report of Truck Data” and adding in its place “Federal Fleet Report (41 CFR 102-34.335)”.

37. Subpart 945.6 is amended by removing the subpart title “Reporting, Redistribution, and Disposal of Contractor Inventory” and adding in its place “Reporting, Reutilization, and Disposal”.

38. Subpart 945.6 is amended by adding a new section “945.602 Reutilization of Government property.”

39. Subpart 945.6 is amended by adding a new section “945.602-70 Local screening”.

40. Section 945.603 is redesignated as 945.670, DOE disposal methods.

41. Section 945.603-70 is amended by redesignating this section as “945.670-1”; and removing “FAR Subpart 45.6” and adding in its place “48 CFR 45.606-3”. This amendment is to conform the DEAR to the FAR.

42. Section 945.603-71 is redesignated as “945.670-2”.”

43. Subpart 945.6 is amended by adding a new section 945.603 Abandonment, destruction or donation of excess personal property which refers to 945.670 for disposal methods. These changes are made to conform to the FAR and move current DEAR information to a new section.

44. Subpart 945.6 is revised by adding a new section 945.604 Disposal of surplus property to conform to the FAR.

45. Section 945.607-2(b) is redesignated as 945.604-1 Recovering precious metals. The office name and address are updated. Paragraph (d) references 945.670 for DOE disposal methods. By adding the other precious metals, we are aligning the DEAR to FAR 46.101.

47. Section 945.608-2 is redesignated as “945.602-3(a)” and is amended by removing subparagraph (b)(1) in its entirety and adding in its place “(a) Standard screening. (1) Prior to reporting excess property to GSA, all reportable property, as identified in Federal Management Regulation 41 CFR 102-36.220, shall be reported for centralized screening in the DOE Energy Asset Disposal System (EADS). Reportable excess personal property will be screened internally via the EADS system for a period of 15 days.” These changes are made to update the DEAR to the current on-line reporting.

50. Redesignated section 945.602-3(a)(1)(i) [previously 945.608-2(b)(1)] is amended by in the first sentence, by removing “REAPS” and adding in its place “EADS”; in the first sentence, by removing “address code” and adding in its place “Activity Address Code (AAC)”; by removing the second sentence in its entirety and adding in its place “The AAC will be assigned by DOE Headquarters upon receipt of a formal letter of authorization signed by the DOE contracting officer,”, and by removing the third sentence in its entirety. These changes are made to update the current procedure.

51. Redesignated section 945.602-3(a)(1)(ii) is amended by removing the sentence in its entirety and adding a new sentence to indicate that any changes to an Activity Address code shall be submitted to the Office of Procurement and Assistance Management, Personal Property Management Division, within the Headquarters procurement organization.

52. The section designated as 945.608-3 is removed. Section 945.602-70 Local screening provides the correct process and title for property screening and disposal.

53. The section designated as 945.608-4 is removed.

54. Section 945.608-5 is redesignated as 945.602-3(b)(2) and is amended in the first paragraph, by adding “(b) Special screening requirements. (2) Special test equipment with commercial components—” prior to the redesignated text.

55. Section 945.608-5(c) is redesignated as 945.602-3(b)(3).

56. Section 945.608-6 is redesignated as 945.670-3; and is amended in paragraph (a) after requirements, by removing “in accordance with the provisions of FAR 45.608-6.”; in both paragraphs, by removing “Office of Property Management Division” and adding in its place “Personal Property Management Division”; and in paragraph (b) by removing “HCA” and adding in its place “Procurement Directors”.

57. Section 945.610-4 is redesignated as 945.671.

58. Section 970.5244-1(k) is amended by removing the paragraph in its entirety and adding in its place “ Government Property”. The Contractor shall establish and maintain a property management system that complies with criteria in 48 CFR 970.5245-1, Property, and 48 CFR 52.245-1, Government Property.”

59. Section 970.5244-1(q)(13) is added to correct an error in the DEAR Final Rule [74 FR 36376-36378, dated July 22, 2009] which omitted “Products made in Federal and penal and correctional institutions—41 CFR 101-26.702.”

60. Section 970.5245-1 is amended by removing and reserving paragraph (i)(1)(ii)(B). This amendment clarifies the contract conditions for property management systems approval.

This regulatory action has been determined not to be a “significant regulatory action” under Executive Order 12866, “Regulatory Planning and Review,” [58 FR 51735, October 4, 1993]. Accordingly, this rule is not subject to review under that Executive Order by the Office of Information and Regulatory Affairs (OIRA) of the Office of Management and Budget (OMB).

With respect to the review of existing regulations and the promulgation of new regulations, section 3(a) of Executive Order 12988, “Civil Justice Reform,” [61 FR 4729, February 7, 1996], imposes on Executive agencies the general duty to adhere to the following requirements: (1) Eliminate drafting errors and ambiguity; (2) write regulations to minimize litigation; and (3) provide a clear legal standard for affected conduct rather than a general standard and promote simplification and burden reduction. With regard to the review required by section 3(a), section 3(b) of Executive Order 12988 specifically requires that Executive agencies make every reasonable effort to ensure that the regulation: (1) Clearly specifies the preemptive effect, if any; (2) clearly specifies any effect on existing Federal law or regulation; (3) provides a clear legal standard for affected conduct while promoting simplification and burden reduction; (4) specifies the retroactive effect, if any; (5) adequately defines key terms; and (6) addresses other important issues affecting clarity and general draftsmanship under any guidelines issued by the United States Attorney General. Section 3(c) of Executive Order 12988 requires Executive agencies to review regulations in light of applicable standards in section 3(a) and section 3(b) to determine whether they are met or if it is unreasonable to meet one or more of them. DOE has completed the required review and determined that, to the extent permitted by law, this rule meets the relevant standards of Executive Order 12988.

The Regulatory Flexibility Act (5 U.S.C. 601 et seq. ) requires that an agency prepare an initial regulatory flexibility analysis for any regulation for which a general notice or proposed rulemaking is required, unless the agency certifies that the rule, if promulgated, will not have a significant economic impact on a substantial number of small entities (5 U.S.C. 605(b)). This rule updates references in the DEAR that apply to public contracts and does not impose any additional requirements on small businesses. This proposed rule does not alter any substantive rights or obligations and consequently, this proposed rule will not have a significant cost or administrative impact on contractors, including small entities.

On the basis of the foregoing, DOE certifies that this proposed rule would not have a significant economic impact on a substantial number of small entities. Accordingly, DOE has not prepared a regulatory flexibility analysis for this rulemaking. DOE's certification and supporting statement of factual basis will be provided to the Chief Counsel for Advocacy of the Small Business Administration pursuant to 5 U.S.C. 605(b).

This proposed rule does not impose a collection of information requirement subject to the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. Existing burdens associated with the collection of certain contractor data under the DEAR have been cleared under OMB control number 1910-4100.

DOE has concluded that promulgation of this proposed rule falls into a class of actions which would not individually or cumulatively have significant impact on the human environment, as determined by DOE's regulations (10 CFR part 1021, subpart D) implementing the National Environmental Policy Act (NEPA) of 1969 (42 U.S.C. 4321 et seq. ). Specifically, this proposed rule is categorically excluded from NEPA review because the amendments to the DEAR are strictly procedural (categorical exclusion A6). Therefore, this proposed rule does not require an environmental impact statement or an environmental assessment pursuant to NEPA.

Executive Order 13132, [64 FR 43255, August 4, 1999], imposes certain requirements on agencies formulating and implementing policies or regulations that preempt State law or that have federalism implications. Agencies are required to examine the constitutional and statutory authority supporting any action that would limit the policymaking discretion of the States and carefully assess the necessity for such actions. The Executive Order requires agencies to have an accountability process to ensure meaningful and timely input by state and local officials in the development of regulatory policies that have federalism implications. On March 14, 2000, DOE published a statement of policy describing the intergovernmental consultation process it will follow in the development of such regulations [65 FR 13735]. DOE has examined the proposed rule and has determined that it does not preempt State law and does 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. No further action is required by Executive Order 13132.

The Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) generally requires a Federal agency to perform a written assessment of costs and benefits of any rule imposing a Federal mandate with costs to State, local or tribal governments, or to the private sector of $100 million or more. This rulemaking proposes changes that do not alter any substantive rights or obligations. This proposed rule does not impose any mandates.

Section 654 of the Treasury and General Government Appropriations Act, 1999 (Pub. L. 105-277), requires Federal agencies to issue a Family Policymaking Assessment for any rulemaking or policy that may affect family well-being. This rulemaking will have no impact on the autonomy or integrity of the family as an institution. Accordingly, DOE has concluded that it is not necessary to prepare a Family Policymaking Assessment.

Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use, [66 FR 28355, May 22, 2001] requires Federal agencies to prepare and submit to Office of Information and Regulatory Affairs (OIRA) of the Office of Management and Budget, a Statement of Energy Effects for any proposed significant energy action. A “significant energy action” is defined as any action by an agency that promulgates or is expected to lead to promulgation of a final rule, and that: (1) Is a significant regulatory action under Executive Order 12866, or any successor order; (2) is likely to have a significant adverse effect on the supply, distribution, or use of energy, or (3) is designated by the Administrator of OIRA as a significant energy action. For any proposed significant energy action, the agency must give a detailed statement of any adverse effects on energy supply, distribution, or use should the proposal be implemented, and of reasonable alternatives to the action and their expected benefits on energy supply, distribution, and use. This proposed rule is not a significant energy action. Accordingly, DOE has not prepared a Statement of Energy Effects.

The Treasury and General Government Appropriations Act, 2001 (44 U.S.C. 3516, note) provides for agencies to review most disseminations of information to the public under guidelines established by each agency pursuant to general guidelines issued by OMB. OMB's guidelines were published at [67 FR 8452, February 22, 2002], and DOE's guidelines were published at [67 FR 62446 October 7, 2002]. DOE has reviewed the proposed rule under the OMB and DOE guidelines and has concluded that it is consistent with applicable policies in those guidelines.

Issuance of this proposed rule has been approved by the Office of the Secretary of Energy.

For the reasons set out in the preamble, the Department of Energy (DOE) proposes to amend Chapter 9 of Title 48 of the Code of Federal Regulations as set forth below.

The proposed rule is intended specifically to help implement Sec. 205 of the Rail Safety Improvement Act of 2008 (RSIA), Public Law 110-432, Division A, which was enacted October 16, 2008, and generally to increase safety at highway-rail and pathway grade crossings. See 49 U.S.C. 20152, Notification of grade crossing problems, and definitions in proposed § 234.301. Sec. 205 of RSIA mandates that the Secretary of Transportation (Secretary) require certain railroad carriers (railroads) to take a series of specified actions related to setting up and using systems for the public to notify the dispatching railroad of grade crossing problems. A separate statutory provision, 49 U.S.C. 20103, gives the Secretary very broad authority to prescribe rail safety regulations and issue rail safety orders pursuant to notice-and-comment procedures. The Secretary has delegated the responsibility to carry out both Sec. 205 of RSIA and 49 U.S.C. 20103 to the Administrator of FRA. 49 CFR 1.49(m), (oo). Essentially, Sec. 205 of RSIA imposes a mandate requiring FRA as the Secretary's delegate to prescribe regulations or orders imposing the requirements specified in that section; FRA has chosen to require the railroads to set up and use a notification program specified by Sec. 205 of RSIA by conducting a rulemaking and prescribing a regulation.

In particular, under Sec. 205 of RSIA, FRA is to require railroads to “establish and maintain a toll-free telephone service for rights-of-way over which the railroad dispatches trains” through “the grade crossing of railroad trains on those rights-of-way and public or private roads,” “to directly receive calls reporting” any of three types of unsafe conditions at the grade crossings or other safety-related information involving such a grade crossing. Under that section, the three types of reportable unsafe conditions are as follows: (1) Malfunctions of warning signals, crossing gates, and other devices intended to promote safety at the highway-rail grade crossing; (2) disabled vehicles blocking railroad tracks at such grade crossings; and (3) obstructions to the view of a pedestrian or a vehicle operator for a reasonable distance in either direction of a train's approach to such a grade crossing. To the extent that the requirements proposed in this NPRM exceed the requirements specified by Sec. 205 of RSIA, such as covering pathway grade crossings, FRA relies primarily upon its general safety rulemaking authority under 49 U.S.C. 20103.

In addition to specifying the requirement that the Secretary must impose on dispatching railroads to establish a telephonic notification system, Sec. 205 of RSIA includes a series of additional specifications to be reflected in FRA's regulation. When a railroad receives a report of a malfunction of a warning signal, crossing gate, and/or other device intended to promote safety at the grade crossing or a report of a disabled vehicle blocking a railroad track at a grade crossing through which the railroad dispatches a train, the dispatching railroad must immediately contact trains operating near the grade crossing to warn them of the malfunctioning device or disabled vehicle. After contacting the trains as necessary, the dispatching railroad must contact, as necessary, appropriate public safety officials having jurisdiction over the grade crossing to provide them with the information necessary for them to direct traffic, assist in the removal of the disabled vehicle, or carry out other activities. When a railroad receives a report of either obstructions to the view of a pedestrian or a vehicle operator for a reasonable distance in either direction of a train's approach to the grade crossing or other safety information involving such grade crossings, the railroad must timely investigate the report, remove the obstruction if possible, or correct the unsafe condition.

Further, under Sec. 205 of RSIA, FRA must require that the owner of the track at the grade crossing “ensure the placement * * * of appropriately located signs” bearing, at a minimum, a toll-free telephone number to be used by the public for placing calls to report unsafe conditions at the crossing to the railroad that dispatches trains on that right-of-way through the crossing, an explanation of the purpose of that toll-free telephone number, and the grade crossing number assigned to that crossing by the U.S. Department of Transportation (DOT) National Crossing Inventory File.

Finally, Sec. 205 of RSIA allows FRA to waive the requirement in the mandated rule that the telephone service be toll-free for Class II and Class III rail carriers if the agency determines that the toll-free service would be cost prohibitive or unnecessary.

There are approximately 221,000 public and private at-grade highway-rail and pathway grade crossings in the United States. In other words, the country has 221,000 locations where a collision can occur between a train and a car, truck, or other motor vehicle, or a pedestrian at any one time. Grade crossing collisions are among the most challenging areas in FRA's efforts to reduce deaths and injuries along the Nation's railroads. In fact, since 1997, grade crossing collisions have caused more railroad-related fatalities per year than any other single factor except for trespassing on railroad property. During the 11-year period from 1999-2009, 2,306 collisions occurred at highway-rail and pathway grade crossings where a vehicle was stalled or sight obstructions were reported to FRA. See accident reporting regulations at 49 CFR part 225 and 49 CFR 234.7.

A train striking a pedestrian can result in serious injury or death. Further, a collision between a train and a vehicle of any size can be catastrophic. Serious injuries or deaths are far more likely to occur with a collision between a train and a vehicle than with a collision between two vehicles. While significant improvements have been achieved over the last two decades, grade crossing collisions still pose a significant public safety threat that can spiral beyond the immediate impact of the vehicle and train.

The derailment of a train as a result of a collision at the grade crossing can have a disastrous effect on the train crew or even on an entire community, especially if the derailment results in a release of hazardous material that necessitates the evacuation of a neighborhood or the community. Moreover, if a passenger train derails as a result of a collision, the risk of injuries extends beyond the vehicle occupants to the crew and passengers of the train. This was the case in 1999 in Bourbonnais, Illinois, when a National Railroad Passenger Corporation (Amtrak) passenger train struck a truck loaded with steel at a highway-rail grade crossing. Almost the entire train derailed, causing 11 deaths and 131 injuries to the passengers and crew of the train.

Other vehicles and pedestrians in the vicinity of a highway-rail or pathway grade crossing collision can also be at grave risk. This was the scenario in 1993 when an Amtrak passenger train collided with a gasoline tanker truck at a highway-rail grade crossing in Ft. Lauderdale, Florida. The truck driver was attempting to cross through a grade crossing where traffic was congested. The tanker truck was punctured when it was struck by the Amtrak train; a fire erupted and engulfed the truck and nine other vehicles near the crossing. The fire killed the driver of the truck and five occupants of three stopped vehicles near the grade crossing.

The ability to provide an effective means for a member of the public to immediately alert the railroad to an emergency situation or other unsafe condition at a highway-rail or pathway grade crossing enables the railroad and local public safety officials to respond earlier to avert a serious incident. Currently, all Class I railroads have put in place some sort of means by which they can receive notification from the public of any emergency or unsafe condition at most of their grade crossings, whereas many regional and short line railroads do not have any such kind of notification system in place. The proposed rule would require certain railroads to implement such a system, which this proposed rule calls an Emergency Notification System (ENS), covering public and private highway-rail and pathway grade crossings.

In 1983, the State government of Texas established the first toll-free call-in program in the United States that has enabled the public to notify a State call center of problems at the State's public highway-rail grade crossings equipped with automated warning devices. In the current Texas program, after receiving such a call, the Texas call center operated by the Texas Department of Public Safety in turn notifies the railroad involved. The call-in system requires that a sign be posted at the highway-rail grade crossing with the crossing's unique identifying number from the U.S. DOT National Crossing Inventory File, as well as a toll-free telephone number. Texas's call center has a dedicated computer with a modified inventory database that facilitates the call recipient's identification of the relevant crossing and railroad. The Center operator then calls the appropriate railroad and relays the report of the problem. At last report the Texas system handles more than 1,200 calls per month for the State's public crossings, even though only those crossings equipped with active warning devices are equipped with the signs containing the Center's toll-free telephone number. It should be noted that if FRA adopts the proposed rule, railroads using State programs for notification of unsafe conditions at grade crossings, such as Texas's program, may no longer comply with the regulation. However, a State would be allowed to operate as a “third-party telephone service” as described in the proposed rule as long as the program complies with all the conditions specified.

Following the successful establishment of this program in Texas, and in part at the urging of FRA and the National Transportation Safety Board (NTSB), our Nation's major railroads have voluntarily adopted similar systems for the majority of their highway-rail and pathway grade crossings, sometimes including all grade crossings, i.e., systems not limited only to public highway-rail grade crossings or only to those equipped with active warning devices. Unfortunately, more than 72,000 public and private highway-rail and pathway grade crossings belonging to our Nation's short line and regional railroads are not included. Many of these railroads do not have 24-hour operations and do not have the resources to establish such a call-in program.

In 1994, Congress directed FRA to conduct pilot projects in at least two States to demonstrate the efficiency of such “emergency notification system” programs covering highway-rail grade crossings and to report to Congress on the results of the programs. Sec. 301, “Emergency Notification of Grade Crossing Problems,” of Public Law 103-440 (108 Stat. 4626). Initial efforts were spent in a cooperative effort with the Texas Department of Emergency Management evaluating the Texas system. Texas was designated one of the pilot States, and an extensive list of software, hardware, and operating improvements was developed. FRA prepared and implemented new software on an upgraded system in 1999. Based on comments and suggestions, further improvements were implemented in 2001 when the Texas call center operation was transferred to the Texas Department of Public Safety.

This 2001 version was modified for use by a 911 center in Clinton County, Pennsylvania, with the participation of eight short line railroads. A 30-month demonstration program was initiated in November 2001.

In 2002, an agreement was reached with the Paducah & Louisville Railroad to conduct an additional pilot project (the third). At the time this was a regional railroad with 24-hour operations and approximately 400 grade crossings. FRA modified the program software to accommodate the railroad's needs.

Further, the 1994 Highway-Rail Crossing Safety Action Plan issued by DOT recommended an automated telephone answering system for handling telephone calls to report emergencies, malfunctions, and other safety-related problems at highway-rail intersections. However, the automated system proved to be unworkable, whereas the staffed systems were successful.

In May 2006, as mandated by Congress in Sec. 301, “Emergency Notification of Grade Crossing Problems,” of Public Law 103-440, FRA published a report to Congress outlining the development of ENS programs up to that date (Report). A copy of the Report can be found at http://www.fra.dot.gov/downloads/safety/1_800_report.pdf. The Report covered, among other things, the Texas ENS program, the Pennsylvania ENS program, Congressional action, NTSB recommendations, and FRA actions. Based on the findings of the Report, FRA made certain recommendations, to Congress. These recommendations were as follows: (1) Class I railroads should continue to implement, augment, and review the emergency notification programs they have initiated; (2) smaller railroads, including commuter railroads, should work cooperatively through The American Short Line and Regional Railroad Association, or another suitable organization or organizations, to establish ENS programs serving member railroads; (3) signs installed or replaced at highway-rail grade crossings should be displayed prominently to crossing users ( e.g., mounted on signal masts where practicable) and conform to the Federal Highway Administration's (FHWA) Manual on Uniform Traffic Control Devices (MUTCD) guidance; and (4) any program that does not currently include passive highway-rail grade crossings be expanded to include, at minimum, all such public crossings where it is practicable to do so.

The Report concluded that the pilot ENS programs in both Texas and Pennsylvania afforded the general public a quick and easy means of alerting appropriate railroad officials of safety-related problems. Additionally, the Report concluded that the Texas ENS likely resulted in the prevention of numerous accidents and injuries, and Pennsylvania's ENS, albeit on a smaller scale than Texas's, demonstrated that it is possible to create emergency call systems through the development of agreements with multiple railroads. Finally, the Report emphasized that the Pennsylvania ENS also showed the value of including all highway-rail grade crossings, not just those with train-activated warning devices.

FRA proposes to expand this part to include new subpart E, Emergency Notification Systems for Reporting Unsafe Conditions at Highway-Rail and Pathway Grade Crossings. For this reason, FRA proposes to amend the description of the scope of the part, § 234.1, by inserting the following sentence: “[t]his part also prescribes minimum requirements that railroads establish a system for receiving toll-free telephone calls from the public at large about unsafe conditions at highway-rail and pathway grade crossings and taking certain actions in response.” Further, for readability of the section, FRA proposes to designate the text of proposed § 234.1 as two paragraphs, with paragraph (b) consisting of the last sentence of current § 234.1.

FRA also proposes to amend § 234.3, Application. Currently, that section, says that, except for § 234.11 (which requires certain States to file State-specific grade crossing safety action plans), part 234 applies to all railroads with the exception of three types. The first type of railroad not subject to part 234 is a railroad that “exclusively operates freight trains only on track which is not part of the general railroad system of transportation.” 49 CFR 234.3(a). This existing exception is intended to cover “plant railroads” as defined in proposed § 234.5, discussed below. The second category of railroads not subject to part 234 is “[r]apid transit operations within an urban area that are not connected to the general railroad system of transportation.” 49 CFR 234.3(b). The third category of railroads not subject to part 234 is each “railroad that operates passenger trains only on track inside an installation is ins ular * * *.” The term “insular” is explained in the rest of the exception. 49 CFR 234.3(c).

Proposed § 234.3(a) would clarify that these same three categories—(1) Plant railroads, (2) urban rapid transit operations not connected to the general railroad system of transportation, and (3) insular tourist, scenic, historic, and excursion railroads (tourist railroads) that are not part of the general railroad system of transportation—are exempt from the requirements of part 234. See 49 CFR part 209, app. A for a discussion of the term “general railroad system of transportation” (general system). FRA's reasons for excluding these three categories of railroads are policy or statutory. FRA almost never exercises its statutory safety jurisdiction over plant railroads as a matter of policy. FRA lacks statutory jurisdiction over urban rapid transit operations not connected to the general system. See 49 U.S.C. 20102, 20103. As a matter of policy, FRA generally does not exercise its statutory jurisdiction over tourist railroads that operate only off the general system; however, part 234 is an existing example of an FRA safety regulation that does apply to tourist railroads that operate only off the general system but only if the tourist railroads are noninsular, e.g., because they have a public highway-rail grade crossing that is in use.

In addition, proposed paragraph (b) of § 234.3 explains that even though a provision of part 234 is stated as requiring certain action by a railroad, a railroad may not avoid fulfilling the requirements of this part by using contractors or subcontractors. For example, if a railroad uses a contractor to put up ENS signs required by proposed § 234.311, FRA will still enforce the provisions of § 234.311 to ensure that the proper signs have been posted and maintained. FRA will hold the railroad liable for its contractor's or subcontractor's failing to fulfill the requirements of this proposed part.

FRA proposes three amendments to the existing “Definitions” section for part 234. First, FRA proposes to amend part 234's existing definition of “credible report of system malfunction.” Currently, subpart C and proposed subpart E refer to “credible reports of warning system malfunctions” rather than “credible report of system malfunction.” To address this inconsistency, FRA proposes to replace “credible report of system malfunction” with “credible report of warning system malfunction” in § 234.5. Furthermore, as a minor clarification within the definition of “credible report of system malfunction,” FRA proposes to replace “an identified highway-rail crossing” with “an identified highway-rail grade crossing.” “[H]ighway-rail crossing” would be replaced with “highway-rail grade crossing” because Subpart C was never intended to apply to grade-separated highway-rail crossings because Subpart C deals only with reports of warning system malfunctions and grade-separated highway-rail crossings are not equipped with warning systems.

Second, FRA proposes to add a definition of “FRA.” The term would be an acronym meaning the Federal Railroad Administration of the U.S. Department of Transportation.

Finally, FRA proposes to add a definition of “plant railroad.” The term refers to a type of operation that has traditionally been excluded from the application of FRA regulations because it is not part of the general railroad system of transportation. There is a more extensive explanation of the general railroad system of transportation in appendix A to 49 CFR part 209, and it is explicitly defined there as “the network of standard gage track over which goods may be transported throughout the nation and passengers may travel between cities and within metropolitan and suburban areas.”

FRA proposes to amend part 234 by adding new subpart E, Emergency Notification Systems for Reporting Unsafe Conditions at Highway-Rail and Pathway Grade Crossings (proposed subpart E), which would include §§ 234.301-234.317.

This proposed section contains definitions of terms used in proposed subpart E, listed alphabetically without designations. “Automated answering service” means a type of answering service in which a telephone call is answered by any means other than a human being speaking live to the caller at the time the call is made. Multiple provisions in proposed subpart E prohibit a railroad from using an automated answering service to receive calls. See proposed §§ 234.303(a), 234.305(h)(2), 234.307(a), and 234.307(b)(2). The rationale for this prohibition is FRA's belief that because in certain scenarios, such as a disabled vehicle blocking the crossing, time is of the essence, and speaking to a human being rather than a machine or recording reduces the time required to initiate the appropriate remedial action, thus improving the opportunity to avert a collision. FRA is considering and seeks comment regarding setting forth a maximum amount of time a caller must wait before a call is answered by the railroad.

“Class II” and “Class III” have the meanings assigned by regulations of the Surface Transportation Board, which may be found at 49 CFR part 1201, General Instructions 1-1, Classification of carriers. To ensure that the definitions of “Class II” and “Class III” as used in this proposed subpart incorporate any changes that the Surface Transportation Board may make after the publication of this proposed subpart, FRA's definition includes any revision to the regulations as applied by the Surface Transportation Board, which includes modifications in the class threshold based on revenue deflator adjustments.

In certain scenarios the railroad that dispatches or otherwise provides the authority for the movement of a train through a grade crossing (such as movement on the mainline under yard limit authority) is not the same railroad that has maintenance responsibility for that crossing. To address this type of situation, FRA proposes to use the terms “dispatching railroad” and “maintaining railroad.” “Dispatching railroad” is defined as a railroad that dispatches or otherwise provides the authority for the movement of one or more trains through a highway-rail or pathway grade crossing. The definition of “maintaining railroad” is discussed below.

To properly receive notification of unsafe conditions at grade crossings, a railroad or group of railroads would be required to implement a system that consists of multiple components. To refer to the entire set of these various components, the term “Emergency Notification System” or its abbreviation (“ENS”) is used. Specifically, “Emergency Notification System” means a system in place by which a railroad informs the public how to report an unsafe condition at a highway-rail or pathway grade crossing and enables the public to do so and receives, processes, and attends to reports of unsafe conditions at highway-rail or pathway grade crossings. The required components of an Emergency Notification System are as follows: (1) Signs, placed and maintained at the grade crossings by the railroad responsible for maintaining the crossing, that display the information necessary for the public to report an unsafe condition at the grade crossing to the railroad that dispatches trains through the crossing; (2) the method that the dispatching railroad uses to receive and process a telephone call reporting the unsafe condition; (3) the remedial actions that the dispatching railroad takes to address the report of the unsafe condition; (4) the remedial actions that the maintaining railroad takes if the dispatching railroad does not have maintenance responsibility; and (5) the recordkeeping conducted by the railroad or railroads in response to the report of the unsafe condition at the grade crossing. Although the word “emergency” is part of the term “Emergency Notification System,” FRA does not intend to imply that all reportable unsafe conditions are emergencies, i.e., conditions that create an imminent hazard of death or injury to an individual or damage to property. In other words, some reportable unsafe conditions are not emergencies. The term “Emergency Notification System” is used in part because of its use in the 1994 legislation and its use colloquially.

It may be noted that this proposed section lacks a proposed definition of “highway-rail grade crossing.” Such a proposed definition is unnecessary because the current definition in § 234.5 applies to part 234 as a whole and would apply to proposed subpart E. Existing § 234.5 defines “highway-rail grade crossing” as “a location where a public highway, road, street, or private roadway, including associated sidewalks and pathways crosses one or more railroad tracks at grade.”

“Maintaining railroad” means the owner of the track at the highway-rail or a pathway grade crossing. If the track owner has contracted out the responsibility to maintain the warning system or track structure at a highway-rail or a pathway grade crossing, the contractor is considered the “maintaining railroad” for the purposes of this subpart. As mentioned previously, the railroad that dispatches a train through a grade crossing and the railroad that maintains the crossing may not necessarily be the same entity. To address this scenario, FRA proposes a definition for “maintaining railroad.”

“Pathway grade crossing” means a pathway that has all of the following characteristics: (1) It is explicitly authorized by a public authority or a railroad; (2) it is dedicated for the use of nonvehicular traffic, including pedestrians, bicyclists, and others; (3) it is not associated with a public highway, road, or street, or a private roadway; and (4) it crosses one or more railroad tracks at grade. Sec. 205 of RSIA provides that the Secretary should require railroads to provide for telephonic notification of safety problems at “the grade crossing of railroad tracks on those rights-of-way and public or private roads.” 49 U.S.C. 20152(a)(1)(A) and references to “such grade crossings” in 49 U.S.C. 20152(a)(1)(B)-(D). In other words, Sec. 205 of RSIA does not mention pathway grade crossings. Section 2 of RSIA, however, defines “crossing,” as used in RSIA, as a location, other than a location where one more railroad tracks cross one or more railroad tracks, where—

FRA recognizes that the definition of “crossing” from section 2 of RSIA includes public, private, and pathway crossings that are grade separated; however, at this time FRA does not intend to expand part 234 and proposed subpart E to include grade-separated crossings. FRA declines to include grade-separated crossings in the proposed rule either because the unsafe conditions that an ENS addresses do not occur at grade-separated crossings  1 or because there is no clear, unambiguous place to put an ENS sign at a grade-separated highway-rail or pathway crossing; therefore, an ENS at grade-separated crossings would not be effective to increase the safety of those crossings.

Proposed § 234.303(a) requires each railroad that dispatches a train through a highway-rail or pathway grade crossing, or provides authority for a train to traverse such a crossing, to set up a system to directly receive telephonic notification of certain unsafe conditions at the crossing. This proposed section would require these dispatching railroads to establish and maintain a toll-free telephone service by which the railroad can directly receive calls from the public reporting any of the unsafe conditions listed in proposed § 234.303(b) (with respect to highway-rail grade crossings) and § 234.303(c) (with respect to pathway grade crossings).

FRA recognizes that in certain scenarios there may be multiple railroads dispatching trains on one or more tracks through one highway-rail or pathway grade crossing. While FRA believes that an ENS should include these types of crossings, it is not clear whether the responsibility to receive reports of unsafe conditions at these types of crossing should fall on one railroad or whether each railroad that dispatches a train through the crossing should be responsible to receive reports. FRA seeks comments on how to handle these types of situations.

The frequency with which a crossing is used does not determine whether it is included in the system established pursuant to proposed § 234.301(a). FRA believes that it is important to provide an immediate means to communicate a notice of an unsafe condition even at grade crossings traversed infrequently. Imagine, for example, the driver of a logging truck stuck at a seldom-used private crossing in the Rocky Mountains with no knowledge of what actions to take or whom to contact.

The FRA Administrator, as the Secretary's delegate, has the discretion to issue a waiver to a Class II or Class III railroad relieving it from the requirement that the telephone number used be toll-free. 49 U.S.C. 20152(b); 49 CFR 1.49. The Administrator may waive the toll-free telephone service requirement for a Class II or Class III railroad if the Administrator determines that the use of a toll-free telephone service would be cost prohibitive or unnecessary. FRA's procedures for seeking a waiver are at 49 CFR part 211 ( e.g., §§ 211.7, 211.9, and 211.41).

A railroad that dispatches a train through a highway-rail or pathway grade crossing or provides authority for a train to traverse such a grade crossing must be able to directly receive calls through the toll-free telephone service. “Directly” does not necessarily mean that the railroad must be the first entity that receives the telephone call when the toll-free service is used. However, “directly” does mean that only a limited number of entities may be placed between the caller reporting the unsafe condition(s) at the grade crossing and the dispatching railroad. FRA proposes that only one entity may exist between the caller and the railroad. This restriction is addressed further in proposed § 234.307. Regardless if an additional entity is used, the railroad ultimately remains responsible for setting up and using a system by which it can receive notification of unsafe conditions at a grade crossing and take the appropriate action in response to a notification. This responsibility is placed on the railroad because it is in the best position to immediately contact and warn the trains authorized to operate through the grade crossing about which the report pertains.

The four types of unsafe conditions at highway-rail grade crossings that are to be reportable through the ENS system are set forth in proposed § 234.303(b). (Again, the four types of unsafe conditions at pathway grade crossings that are to be reportable through the ENS system are listed in proposed § 234.303(c).) The first type of reportable unsafe condition at a highway-rail grade crossing is a warning system malfunction at the crossing. “Warning system malfunction,” as defined in proposed § 234.5, means an activation failure, a partial activation, or a false activation of a highway-rail grade crossing warning system. The terms “activation failure,” “partial activation,” and “false activation” are all defined in existing § 234.5 as well.

The second type of reportable unsafe condition at a highway-rail grade crossing is a disabled vehicle or other obstruction blocking a railroad track at the crossing. As mentioned in Section II of this preamble, a significant number of collisions between a train and a vehicle have occurred at highway-rail grade crossings due to a vehicle blocking the railroad tracks at the crossing, with many of these collisions resulting in injuries and fatalities. While FRA acknowledges that not all of these incidents may have been prevented by the presence of an ENS, such a system increases the likelihood that the dispatching railroad will learn of the disabled vehicle in time to alert any trains authorized to operate through that crossing, thus potentially averting a collision and any resulting casualties. Further, other obstructions, aside from a disabled vehicle, may block the tracks at a crossing and create an unsafe condition that needs to be reported to the railroad. For instance, as a result of a severe storm, a large tree may fall onto the tracks at a highway-rail grade crossing, and if a railroad is not alerted about this unsafe condition, a train that is authorized to operate through that crossing could collide with the downed tree, thus potentially causing a derailment. Under Sec. 205 of RSIA, the second category of unsafe conditions is a disabled vehicle blocking the tracks at a grade crossing. To the extent that FRA's proposed rule requires more than Sec. 205 of RSIA would have it require, the agency relies on its general safety rulemaking authority.

The third type of a reportable unsafe condition at a highway-rail crossing is an obstruction to the view of a pedestrian or a vehicle operator for a reasonable distance in either direction of a train's approach to the crossing. FRA's Track Safety Standards provide that “vegetation on railroad property which is on or immediately adjacent to the roadbed shall be controlled so that it does not [o]bstruct visibility of railroad signs and signals [a]t highway-rail grade crossings.” 49 CFR 213.7(b)(1) (§ 213.7(b)(1)). Proposed § 234.303(b)(3) allows a member of the public to inform the railroad of conditions at highway-rail grade crossings that may not fall under § 213.7(b)(1), but that, in the individual's opinion, present an unsafe condition involving a sight obstruction at the crossing. FRA seeks comment regarding what is a “reasonable distance” to determine whether an obstruction to a pedestrian or vehicle operator's view of a train's approach to a highway-rail grade crossing presents an unsafe condition at the grade crossing.

The final type of reportable unsafe condition at a highway-rail grade crossing is any condition at the crossing that may be considered unsafe and is not covered by § 234.303(b)(1)-(3). A downed or missing crossbuck sign illustrates the type of condition at a highway-rail grade crossing that may be deemed unsafe, and therefore should be reported to the railroad, but does not fall into one of the three other categories. However, a downed or missing crossbuck sign is merely an example and is not intended to be an exhaustive list of the various conditions that may be considered unsafe under this catch-all provision.

Proposed § 234.303(c) sets forth the four types of reportable unsafe conditions at pathway grade crossings as opposed to highway-rail grade crossings. These four types of reportable unsafe conditions at pathway grade crossings are, essentially, the same as those for highway-rail grade crossings, but, as detailed below, the four types of reportable unsafe conditions at pathway grade crossings are not described in the exact same words, and unlike the first type of report for a highway-rail grade crossing, the first type of report for a pathway grade crossing does not trigger the duty to address the report in the manner prescribed by existing 49 CFR part 234, subpart C (subpart C).

The first type of reportable condition for a pathway grade crossing is a failure of the active warning system at the pathway grade crossing to perform as intended. Proposed § 234.303(c)(1) does not use term “warning system malfunction” to refer to a failure of an active warning system at a pathway grade crossing because, as defined in § 234.5, a “warning system malfunction” is an activation failure, partial activation, or false activation of the active warning system at a highway-rail grade crossing, not a pathway grade crossing. Further, “activation failure,” “partial activation,” and “false activation” are all defined in § 234.5 and only apply to highway-rail grade crossings. FRA has not proposed specific standards regarding the maintenance and repair of active warning systems at pathway grade crossings and does not intend to do so at this time. However, FRA does intend to require that certain railroads provide the public with a means to report when the active warning system at a pathway grade crossing is not performing as intended and is creating an unsafe condition at the crossing.

While the term “failure of the active warning system at the pathway grade crossing to perform as intended” as used in proposed § 234.303(c)(1) is not specifically defined, FRA believes that the term sufficiently addresses the scenarios in which an active warning system at a pathway grade crossing malfunctions and poses a significant safety risk to a pathway grade crossing user. FRA seeks comment regarding the types of failures of an active warning system at a pathway grade crossing that may differ from failures of active warning systems at highway-rail grade crossings. Additionally, FRA seeks comment regarding how the maintenance and repair of an active warning system at a pathway grade crossing differ from the required maintenance and repair of an active warning system at a highway-rail grade crossing.

The second type of reportable unsafe condition at a pathway grade crossing is an obstruction blocking a railroad track at the crossing. To avoid confusion, the term “disabled vehicle” is purposely omitted from proposed § 234.303(c)(2), though it is used in proposed § 234.303(b)(2), because, as defined in proposed § 234.301, a “pathway grade crossing” is, among other things, dedicated for the use of nonvehicular traffic; thus, by the definition, a vehicle should not be using a pathway grade crossing. However, to ensure that all possible scenarios in which an obstruction could be blocking the tracks at a pathway grade crossing, including certain disabled vehicles that may be using the pathway (such as all-terrain vehicles, golf carts, maintenance vehicles, or snowmobiles), § 234.303(c)(2) uses the broad term “obstruction.”

The third type of reportable unsafe condition at a pathway grade crossing is an obstruction to the view of a pathway user for a reasonable distance in either direction of a train's approach to the crossing. See discussion of proposed § 234.303(b)(3).

The final type of reportable unsafe condition at a pathway grade crossing is any condition at the crossing that may be considered unsafe and is not covered by § 234.303(c)(1)-(3). See discussion of proposed § 234.303(b)(4).

As mentioned previously, the FRA Administrator has the discretion to waive the requirement that the ENS telephone number be toll-free for Class II and Class III railroads. The Administrator may waive the toll-free requirement for these railroads if he or she determines that the use of a toll-free service would be cost prohibitive or unnecessary. FRA believes that there may be certain scenarios in which a caller would be discouraged from reporting an unsafe condition at a grade crossing because the use of a non-toll-free number would impose an additional cost on the caller as opposed to if a toll-free number was used. Further, the requirement for the number to be toll-free may be overly burdensome to a short line or other small railroad. To avoid these types of situations, FRA proposes in § 234.303(d) that if a Class II or Class III railroad dispatches trains within an area in which the use of a non-toll-free number would not incur any additional fees for the caller compared to if a toll-free number was used, then that railroad may use that non-toll-free number to receive calls pursuant to § 234.303(a) regarding each grade crossing in that area.

Paragraph (e) ensures that if a report of an unsafe condition at a highway-rail or pathway grade crossing was not made through the telephone service described in proposed § 234.303(a), subpart E does not apply. Since subpart E only sets forth the requirements of an ENS and the actions taken in response to a report of unsafe condition received through an ENS, a report that is not received through an ENS does not invoke the requirements in subpart E.

FRA is considering whether to extend proposed subpart E to cover all public highway-rail grade crossings located within a port, or dock facility, railroad yard or private industrial facility and such a facility/yard is subject to part 234 as set forth in amended § 234.3. If these types of crossings are covered by proposed subpart E, FRA is considering whether to treat all of the crossings located in such facilities/yards as a single public highway-rail grade crossing for the purposes of proposed subpart E. These areas often have a significant number of crossings located in a small area, and FRA believes that it may be impracticable to consider each crossing within these areas as a separate grade crossing. Treating all the public highway-rail grade crossings within these facilities/yards as one public highway-rail grade crossing is consistent with the U.S. DOT National Highway-Rail Crossing Inventory, Policy, Procedures and Instructions for States and Railroads, published August 2007, which can be found at— http://www.fra.dot.gov/downloads/safety/RXIPolicyInstructions0807.pdf. FRA seeks comment whether proposed subpart E should be extended to incorporate public highway-rail grade crossings located within a port, or dock facility, railroad yard or private industrial facility. FRA also seeks comment whether it is practicable to treat all of the public highway-rail grade crossings within such facilities/yards as one public highway-rail grade crossing for the purposes of proposed subpart E.

Proposed § 234.305 addresses the actions that a railroad must take in response to an ENS-generated report of an unsafe condition at a highway-rail or pathway grade crossing. Paragraph (a) of the proposed section is the general rule on required response to ENS-generated credible reports of warning system malfunctions. If a railroad receives an ENS-generated report of a warning system malfunction that is a credible report of warning system malfunction and the railroad has maintenance responsibility for the warning system at the highway-rail grade crossing to which the report pertains, the railroad is required to take the appropriate action as required by subpart C. As defined in proposed § 234.5, a “credible report of warning system malfunction” is “specific information regarding a malfunction at an identified highway-rail grade crossing, supplied by a railroad employee, law enforcement officer, highway traffic official, or other employee of a public agency acting in an official capacity.” If a report of a warning system malfunction is not provided by one of the four specific types of people listed, then the report is not a credible report of system malfunction within the meaning of both subpart C and proposed subpart E, and subpart C does not require any remedial action in response to those reports. It should be noted that a credible report of warning system malfunction only applies to highway-rail grade crossings and does not include pathway grade crossings. At this time FRA does not plan to expand the definition of “credible report of warning system malfunction” to include pathway grade crossings. Thus, regardless of who reports a warning system malfunction at a pathway grade crossing, the report is not considered a “credible report of warning system malfunction” within the meaning of both subpart C and proposed subpart E. However, it is important to note that the term “credible” does not go to the accuracy or truthfulness of the report; rather, it distinguishes the type of person providing the report to the railroad. Just because a report is not considered a “credible report of warning system malfunction,” as defined by proposed § 234.5, does not mean that it is not accurate or truthful.

If the report is a credible report of warning system malfunction, but the railroad that initially receives the report is not the railroad that has maintenance responsibility for the warning system at the highway-rail grade crossing to which the report pertains, that railroad is already responsible for contacting the trains that are authorized to operate through the highway-rail grade crossing and warn the trains of the reported malfunction under subpart C. After warning the trains, the railroad must then contact the railroad that has maintenance responsibility for the warning system at the highway-rail grade crossing, which will then be responsible for taking the appropriate remedial action under subpart C. FRA recognizes that in many instances the railroad that initially receives the report may not be the railroad that has maintenance responsibility over the warning system at that crossing. Therefore, to ensure that the responsibility to take the appropriate remedial action as required by subpart C falls on the appropriate railroad, proposed § 234.305(a)(2) requires the railroad with maintenance responsibility to take the appropriate remedial action under subpart C, except for immediately contacting the trains operating through the crossing; this responsibility remains with the dispatching railroad.

Paragraph (b) of proposed § 234.305 is the general rule on response to ENS-generated reports of warning system malfunctions at highway-rail grade crossings that are not considered credible reports of warning system malfunctions as defined by proposed § 234.5 and requires that railroads take certain specified remedial action in response to those reports. In other words, proposed § 234.305(b) addresses ENS-generated reports of warning system malfunctions that do not fall within the amended definition of “credible report of warning system malfunction” in § 234.5 because the report is made by someone who is not a railroad employee, law enforcement officer, highway traffic official, or other employee of a public agency acting in an official capacity. In particular, if a railroad receives a report of a warning system malfunction that is not a credible report of warning system malfunction and that railroad has maintenance responsibility for the warning system at the crossing, the railroad must immediately contact all trains that are authorized to operate through the grade crossing about which the report pertains and warn those trains of the reported malfunction. The railroad must then promptly contact the law enforcement agency that has jurisdiction over the crossing and provide the necessary information for the law enforcement agency to direct traffic or carry out other activities to maintain safety at the grade crossing. Further, the railroad must promptly investigate the report and determine the nature of the malfunction and, if necessary, take appropriate action as required by a provision of existing 49 CFR part 234, subpart D, i.e., § 234.207(a), which requires that “[w]hen any essential component of a highway-rail grade crossing warning system fails to perform its intended function, the cause shall be determined and the faulty component adjusted, repaired, or replaced without undue delay.”

If a railroad receives a report of a warning system malfunction that is not a credible report of warning system malfunction and that railroad does not have maintenance responsibility for the warning system at the highway rail grade crossing, the railroad must immediately contact all trains that are authorized to operate through the grade crossing to which the report pertains and warn those trains of the reported malfunction. The railroad must then promptly contact the law enforcement agency that has jurisdiction over the grade crossing and provide the necessary information for the law enforcement agency to direct traffic or carry out other activities to maintain safety at the grade crossing. The railroad must then promptly contact the railroad that has maintenance responsibility for the warning system and inform that railroad of the reported malfunction. The railroad having maintenance responsibility must promptly investigate the report, determine the nature of the malfunction and take the appropriate action as required by § 234.207(a) if necessary.

Proposed § 234.305(c) is the general rule on response to a warning system failure at a pathway grade crossing. If the dispatching railroad receives a report pursuant to § 234.303(c)(1) and that railroad also has maintenance responsibility for the active warning system at the pathway grade crossing, the railroad shall immediately contact all trains that are authorized to operate through the pathway grade crossings to which the report pertains and warn the trains of the reported failure. The railroad shall then promptly contact the law enforcement agency having jurisdiction over the pathway grade crossing and provide the necessary information to the law enforcement agency to direct traffic or carry out other activities to maintain safety at the pathway grade crossing. Finally, the railroad shall the promptly investigate the report and determine the nature of the reported failure and repair the warning system if necessary.

If the dispatching railroad receives a report of a warning system failure at a pathway grade crossing and that dispatching railroad does not have maintenance responsibility for the warning system at the pathway grade crossing, the dispatching railroad must immediately contact all trains that are authorized to operate through the pathway grade crossing to which the report pertains and warn those trains of the reported failure. The dispatching railroad must then promptly contact the law enforcement agency that has jurisdiction over the pathway grade crossing and provide the necessary information for the law enforcement agency to direct traffic or carry out other activities to maintain safety at the pathway grade crossing. The dispatching railroad must then promptly contact the railroad that has maintenance responsibility for the warning system at the pathway grade crossing and inform that railroad of the reported failure. The railroad having maintenance responsibility shall then promptly investigate the report and determine the nature of the reported failure and repair the warning system if necessary.

Proposed § 234.305(d) is the general rule on a dispatching railroad's response to reports of a disabled vehicle or other obstruction blocking a railroad track at a highway-rail or pathway grade crossing through which it dispatches trains. When a railroad receives a report of a disabled vehicle or obstruction blocking a railroad track at a grade crossing, the railroad must immediately contact all trains that are authorized to operate through the grade crossing to which the report pertains and warn the trains of the reported disabled vehicle or obstruction. Once all of the necessary trains are contacted, the railroad must then contact the law enforcement agency having jurisdiction over the grade crossing to provide that agency with the information necessary to assist in the removal of the disabled vehicle or other obstruction or carry out other activities as appropriate. FRA is considering and seeks comments on whether to require the railroad that receives the report (dispatching railroad) to contact the maintaining railroad if the obstruction is anything other than a disabled vehicle. The maintaining railroad would then be responsible for contacting the law enforcement agency and any other entities to assist in directing traffic (if necessary) and removing the obstruction.

Proposed § 234.305(e) is the special rule on contacting a train that is not required to have communication equipment. Section 220.9 of FRA's regulations on railroad communications sets forth communication equipment standards for trains. 49 CFR 220.9 (§ 220.9). These standards vary according to specific criteria set forth in § 220.9. According to § 220.9(b), no communication equipment is required on a train if that train does not transport passengers or hazardous material and does not engage in joint operations or operate at greater than 25 miles per hour. See 63 FR 47188; § 220.9(b)(1)-(4). However, as proposed in subpart E, upon receipt of a report of a warning system malfunction, a warning system failure at a pathway grade crossing, or a disabled vehicle or other obstruction blocking a track, a railroad will be required to immediately contact a train authorized to operate through the highway-rail or pathway grade crossing to which the report pertains. If that train is not required by § 220.9 to have any communications equipment, the railroad must contact that train by the quickest means available. Currently, railroad employees are required by 49 CFR 220.13(a) (§ 220.13(a)) to immediately report certain emergencies by the quickest means available. To maintain consistency among FRA regulations, proposed § 234.305(e) requires that the quickest means used to contact a train upon receipt of a report of a warning system malfunction or disabled vehicle or other obstruction blocking a track at the crossing is consistent with the quickest means that an employee would use to report an emergency pursuant to § 220.13(a).

Proposed § 234.305(f) is the general rule on response to reports of an obstruction to the view of a pedestrian or a vehicle operator for a reasonable distance in either direction of a train's approach to the highway-rail or pathway grade crossing (visual obstruction). FRA proposes that when the dispatching railroad receives a report of a visual obstruction and the railroad also has maintenance responsibility for the highway-rail or pathway grade crossing, the railroad shall timely investigate the report and, if the report is confirmed, shall remove the visual obstruction if it is feasible and lawful to do so. If the dispatching railroad does not have maintenance responsibility for the highway-rail or pathway grade crossing, the dispatching railroad shall promptly contact the railroad having maintenance responsibility for the highway-rail or pathway grade crossing, which shall timely investigate the report; and, if the report is confirmed, shall remove the visual obstruction, if it is lawful and feasible to do so. FRA recognizes that in certain instances a visual obstruction may not be removed, such as a natural visual obstruction due to the steepness of the road or path approaching the crossing or a visual obstruction due to the curvature of the track, or it may not be lawful to do so. Therefore, proposed § 234.305(f)(2) imposes a duty on the maintaining railroad to remove the visual obstruction only if it is lawful and feasible to do so. FRA seeks comment on what types of visual obstructions are not feasible to remove.

Proposed § 234.305(g) is the general rule on response to reports of other unsafe conditions at highway-rail or pathway grade crossings. Proposed § 234.305(g)(1) states that if the railroad receives a report related to a safety device at a highway-rail or pathway grade crossing, such as a downed crossbuck, that is not covered by proposed § 234.305(a), (b), or (c), and the railroad has maintenance responsibility for the device, the railroad must timely investigate the report, and if the railroad finds that the unsafe condition exists, the railroad must timely correct it. However, if the railroad that receives the report does not have maintenance responsibility over the device, upon receipt of the report, the railroad must timely inform the railroad with maintenance responsibility for correcting the unsafe condition. The railroad with maintenance responsibility must then timely investigate the report and if it finds that the unsafe condition exists, it must timely correct it if it is lawful and feasible to do so. FRA seeks comment on what types of other unsafe conditions are not feasible to correct.

Proposed § 234.305(g)(2) states that if the dispatching railroad receives a report relating to any other unsafe condition at the highway-rail or pathway grade crossing that is not covered by proposed § 234.305(g)(1) and the dispatching railroad is also the maintaining for the grade crossing, the dispatching railroad shall timely investigate the report and if it finds that the unsafe condition exists, the dispatching railroad shall timely correct it if it is lawful and feasible to do so. If the dispatching railroad is not the maintaining railroad, the dispatching railroad shall timely inform the maintaining railroad of the report and the maintaining railroad shall timely investigate the report. If, after investigating the report, the maintaining railroad finds that the unsafe condition exists, the maintaining railroad shall timely correct it if it is lawful and feasible to do.

Paragraph (h) is the general rule on contacting the maintaining railroad. If the dispatching railroad is not the same as the maintaining railroad, the maintaining railroad shall provide the dispatching railroad with sufficient contact information by which the dispatching railroad may immediately contact the maintaining railroad upon receipt of a report if necessary. Furthermore, the maintaining railroad shall not use an automated answering service for the purpose of receiving a call from the dispatching railroad.

Proposed § 234.307 would address the third-party telephone service that a dispatching railroad may use to receive reports concerning an unsafe condition at a highway-rail or pathway grade crossing pursuant to proposed § 234.303.

For a railroad to “directly” receive calls reporting unsafe conditions at a crossing as required by proposed § 234.303, FRA proposes that one entity is the maximum number of entities that may exist between (1) a caller reporting an unsafe condition at a grade crossing and (2) the railroad. FRA believes that allowing more than one entity in between could potentially delay the railroad's receipt of the report and therefore delay its response to the unsafe condition to the extent that the ENS would not be effective. Proposed § 234.307 sets forth the requirements for the third-party telephone service.

FRA recognizes that many regional and short line railroads may not have the capability and resources to set up and operate a 24-hour system to respond to reports of unsafe conditions at highway-rail and pathway grade crossings. To ensure that the public can call in such reports and that more dispatching railroads can receive the reports, the proposed rule allows railroads to use a third-party telephone service.

Paragraph (a) permits a railroad to use a third-party telephone service to receive reports pursuant to proposed § 234.303. FRA believes that it is in the railroad's interest to use a third-party telephone service that is in the business of receiving and processing calls from the public because that is its specialty. Even if the railroad uses a third-party telephone service, the railroad ultimately remains responsible for receiving the report received by the third party, and the railroad is responsible for taking the appropriate remedial action as required by proposed § 234.305 and complying with the proper recordkeeping requirements proposed in § 234.313. The third-party telephone service is merely an extension of the railroad. The third-party service must be reached directly by the telephone number placed on the sign pursuant to proposed § 234.309. Furthermore, the third-party service is prohibited from using an automated answering service, as defined in proposed § 234.301, to receive calls. The railroad remains responsible for ensuring that an automated answering service is not used.

Proposed paragraph (b) obliges a railroad that uses the third-party service to provide the service with sufficient contact information so that when the third-party service receives a report of an unsafe condition at a grade crossing, it can immediately contact the railroad. The railroad is prohibited from using an automated answering service to receive calls from the third-party service. There may be an unsafe condition for which immediate action by the railroad is necessary, such as a disabled vehicle blocking a track at the crossing; therefore, the contact information that the railroad provides the third-party service must be sufficient to the extent that when the third-party service contacts the railroad, a railroad employee answers the call and takes the appropriate action necessary under proposed § 234.305. The responsibility of the third-party service is solely to receive reports and relay those reports to the railroad; any remedial action that is necessary to correct the unsafe condition is the responsibility of the railroad.

Proposed paragraph (b) also requires a railroad to promptly inform FRA of its intent to use a third-party service to receive reports pursuant to proposed § 234.303. The railroad must also provide FRA with the contact information of the third-party service that the railroad intends to use. Further, the railroad must provide FRA with a list of the grade crossings about which the third-party service will be receiving reports pursuant to proposed § 234.303. This information will allow FRA to evaluate whether the use of a third-party service substantially increases the railroad's response time to the extent that, because of the use of the service, the railroad is no longer considered to be receiving calls “directly.” Finally, proposed paragraph (b) reaffirms the requirement that once a railroad receives a report of an unsafe condition at a grade crossing pursuant to proposed § 234.303, the railroad must, at a minimum, take the remedial action required by proposed § 234.305.

Proposed paragraph (c) sets forth the duties of the third-party service. The third-party service is required to contact the contracting railroad immediately when the third-party service receives a report pursuant to proposed § 234.303. The third-party service must then provide the contracting railroad with a minimum amount of information. The first type of information that the third-party service must provide is the nature of the reported unsafe condition. The nature of the reported unsafe condition must fall into one of the categories listed in proposed § 234.303(b)(1)-(4) or (c)(1)-(4) so that the contracting railroad can take the appropriate remedial action as required by proposed § 234.305. Second, the third-party service must provide information on the location of the unsafe condition, which includes providing the U.S. DOT National Crossing Inventory File Number for the crossing. Third, the third-party service must inform the contracting railroad whether the person reporting the unsafe condition is a railroad employee, law enforcement officer, highway traffic official, or other employee of a public agency acting in an official capacity. The third-party service is required to provide this information so that the contracting railroad can determine whether the report is a credible report of warning system malfunction and, if it is, the railroad can take the appropriate remedial action required by proposed § 234.305 and existing subpart C. Finally, the third-party service must provide the contracting railroad with any additional information provided by the caller that may be useful to restore the crossing to a safe condition.

Paragraph (d) ensures that the third-party service, in addition to the contracting railroad, is responsible for complying with proposed subpart E and that both the railroad and the third party service can be held liable for a violation of proposed subpart E.

FRA recognizes that future advances in technology may provide opportunities for call-in systems that are not specifically described in this rule. FRA is willing to review any new technology and consider its applicability to the regulation, or consider amending the regulation in the future if warranted. FRA welcomes comments on any such technologies that meet the requirements of the proposed regulation.

Proposed § 234.309 would specify the color, minimum required dimensions, contents, and other aspects of the signs that § 234.311 requires to be placed and maintained at highway-rail and pathway grade crossings as part of an ENS. A minimum amount of information must be placed on the sign so that the unsafe condition may be properly reported and remedied. This minimum information is the toll-free number established to receive reports pursuant to § 234.303(a) (or non-toll-free number as provided for in § 234.303(d)), an explanation of the purpose of the sign, and the U.S. DOT National Crossing Inventory File Number assigned to the crossing. To maintain a certain amount of consistency among the signs so that a grade crossing user may be able to easily identify and understand it, FRA proposes that the sign dimensions must be at least 12 inches by 9 inches, the lettering must be, at a minimum, 1 inch in height, and the sign must have a white legend and border on a blue background.

FRA is considering whether the final rule should require that the sign be designed in accordance with the applicable provisions of the FHWA's MUTCD and Standard Highway Signs and Markings (SHSM) book. Currently, § 8B.18 of the 2009 edition of the MUTCD provides standards and guidance regarding emergency notification signs. Figure 1 is the example of an emergency notification sign provided in the MUTCD. Further, the new edition of the SHSM book, which had not been published at the time of the writing of this NPRM, provides two alternate designs for emergency notification signs, one of which is identical to the emergency notification sign provided in the MUTCD. The SHSM can be found at http://mutcd.fhwa.dot.gov/shsm_interim/index.htm. Figure 2 is an alternate design found in the new edition of the SHSM book. FRA is seeking comment regarding which standards and guidance provided in the MUTCD and SHSM book should be adopted in the final rule as the requirements for the signs placed at crossings pursuant to proposed §§ 234.309 and 234.311.

Proposed § 234.311 would require signs of the type specified by proposed § 234.309 to be placed and maintained at highway-rail and pathway grade crossings. The maintaining railroad would be responsible for the proper placement and maintenance of the sign. The dispatching railroad would be responsible for providing the telephone number posted on the sign to the maintaining railroad if the two are not the same railroad.

A sign must be placed and maintained for each direction of traffic at that grade crossing. This will ensure that grade crossing users will be able to see the sign from whichever direction they approach the crossing. A pathway grade crossing is considered to have a minimum of two directions of traffic unless specifically designed for traffic in one direction only.

Each sign placed at a highway-rail or pathway grade crossing must be placed and maintained so that the sign is conspicuous to the users of the roadway or pathway, optimizes nighttime visibility, minimizes the effect of mud splatter and debris, and does not obscure any other sign at the crossing. FRA does not propose a specific location at a crossing where a sign must be placed because such a specific location may not exist at every crossing. However, FRA proposes general requirements regarding the placement of the sign so that the sign may be easily seen and does not interfere with any other traffic control devices at the crossing. FRA is seeking comment on sign placement so the appropriate placement for optimal visual effectiveness of the sign may be determined. FRA is also seeking comment on how many and where to place signs at a highway-rail or pathway grade crossing in which there are multiple railroads dispatching trains on one or more tracks through that crossing.

Proposed paragraph (c) does not prohibit the placement of an ENS sign on a signal bungalow; however, a sign on the signal bungalow and nowhere else at the crossing does not comply with proposed § 234.311. It is difficult to envision a scenario in which placing the sign on the signal bungalow would satisfy all of the requirements in proposed § 234.311(b), particularly, § 234.311(b)(1), which requires a sign to be placed at a grade crossing so that it is conspicuous to the users of the roadway or pathway. FRA seeks comment on other locations at grade crossings where the placement of the sign would not satisfy proposed § 234.311(b).

As mentioned previously, FRA is considering whether to expand proposed subpart E to cover all public highway-rail grade crossings located within a port or dock facility, railroad yard, or private industrial facility and to make such a facility or yard subject to part 234. In turn, if these types of crossings would be covered by proposed subpart E, FRA is considering whether to treat all of the crossings located in such a facility or yard as a single public highway-rail grade crossing for the purposes of proposed subpart E. If these crossings are treated as a single public highway-rail grade crossing, FRA is considering whether to require a sign that conforms to proposed § 234.309 to be placed and maintained as provided under proposed § 234.311(a) and (b) at each point at which a public highway enters the facility or yard. FRA seeks comment whether this would be the optimal location for the sign for these types of facilities or yards if they are covered.

Proposed § 234.313 sets forth the recordkeeping requirements for this proposed subpart that apply to each railroad subject to this proposed subpart. Proposed paragraph (a) of this section requires each railroad to keep records pertaining to compliance with this subpart. Records may be kept on paper forms generated by the railroad or kept electronically in a manner that conforms with proposed § 234.315. Each railroad must keep the following information for each report received under the proposed subpart: (1) The nature of the reported unsafe condition; (2) the location of the grade crossing (by highway name and U.S. DOT National Crossing Inventory File Number); (3) the time and date of receipt of the report by the railroad; (4) whether the person who provided the report was a railroad employee, law enforcement officer, highway traffic official, or other employee of a public agency acting in an official capacity; (5) the actions taken by the railroad prior to rectifying the reported unsafe condition; (6) the actions taken by the railroad to rectify, if possible, the reported grade crossing problem; (7) the date and time at which the reported unsafe condition was rectified; and (8) if the railroad is required to contact the railroad with maintenance responsibility, the time and date the railroad contacted the railroad having maintenance responsibility. FRA is considering whether to require the railroad to also record the caller's name and contact information so the railroad can follow-up with the caller if necessary. FRA seeks comment on what other information the railroad should be required to record.

Subpart C at 49 CFR 234.109 (§ 234.109) already has specific recordkeeping requirements for a railroad that receives a credible report of warning system malfunction; therefore, there is no separate recordkeeping requirement in proposed subpart E for credible reports of warning system malfunction. Proposed § 234.313(c) requires that each railroad retain for at least one year (from the latest date of railroad activity in response to a report received under this part) all records that it makes that are required by this section. Records required to be kept must be made available to FRA as provided by statute (49 U.S.C. 20107).

Proposed § 234.315 would address the keeping of records required by proposed subpart E electronically. This proposed section applies to railroads that choose to conduct electronic recordkeeping under proposed subpart E. These proposed electronic recordkeeping requirements are modeled after the requirements set forth in 49 CFR 217.9(g).

If a railroad chooses to conduct electronic recordkeeping of records required by proposed subpart E, the railroad must provide adequate security measures to limit employee access to its electronic data processing system and must prescribe who is allowed to create, modify, or delete data from the database. Although FRA does not identify the management position authorized to institute changes in the database, the railroad must indicate the source authorized to make such changes. The railroad must have a computer and a facsimile or printer connected to the computer to retrieve and produce records for immediate review. Section 217.9(g) requires the computer to be a desk-top computer. However, FRA recognizes that all railroads may not necessarily maintain their records on a desktop computer, so rather than adopting this requirement from § 217.9(g); FRA proposes to allow railroads the flexibility to maintain their records on other types of computers, such as laptops. However, regardless of the computer on which the railroad maintains its electronic records, it must be possible for a facsimile or printer to be connected to the computer to retrieve and produce records for immediate review. The documents must be made available for FRA inspection during “normal business hours,” which FRA interprets as the time, any day of the week, when railroads conduct their regular business transactions. Nevertheless, FRA reserves the right to review and examine the documents prepared in accordance with the applicable section of part 234 at any reasonable time if situations warrant. Each railroad must also designate who will be authorized to authenticate the hard copies produced from the electronic format. In short, each railroad electing to retain its records electronically must ensure the integrity of the information and prevent possible tampering of data, enabling FRA to fully execute its enforcement responsibilities.

Proposed § 234.317 would state the date by which each of various groups of railroads must comply with this proposed subpart. If a railroad does not have an ENS of any kind in place on the effective date of the subpart, the railroad has 18 months from the effective date of the final rule to implement a system that conforms to the subpart. This paragraph applies to railroads that do not have anything any place that could be considered an ENS as defined in § 234.301. However, if a railroad has a system in place, but some or all of the components do not conform to this subpart, the amount of time the railroad has to bring it into compliance depends on which component is non-compliant.

If a railroad already has its own ENS telephone service or is using a third-party telephone service on the effective date of this subpart, but that telephone service does not comply with the requirements proposed in §§ 234.303 and 243.307, the railroad has six months from the effective date of the final rule to bring the telephone service into compliance.

If a railroad already has ENS signs in place on the effective date, but those signs do not comply with the requirements set forth in proposed § 234.309, subject to proposed § 234.317(d)(2), the railroad has five years from the effective date of the final rule to bring the signs into compliance. If the railroad replaces a non-conforming sign before the five-year period, the railroad must replace the sign with one that conforms to proposed § 234.309. However, there is an exception to this five-year period. To ensure that a non-conforming sign is still large enough to be visible to the majority of grade crossing users, if a sign is less than 60 square inches, the railroad has 18 months from the effective date of the final rule to bring the sign into compliance with proposed § 234.309. If the railroad replaces a non-conforming sign before the 18-month period, the railroad must replace the sign with one that conforms to proposed § 234.309.

FRA is considering whether to reduce the amount of time that the railroad has to bring the sign into compliance based on whether the non-compliant element of the sign effectively renders the sign useless. For example, if a sign does not comply because the telephone number on the sign is not the correct number, the sign is effectively useless because a person is unable to report any unsafe conditions at the crossing to the appropriate railroad. In these instances it is as if there were not a sign at the crossing, thus, the railroad would then have 18 months, as required by § 234.317(a), to place a sign at the crossing. Therefore, FRA is considering reducing the compliance period from five years to 18 months if the non-compliant element of the sign effectively renders the sign useless. FRA seeks comment regarding reducing the compliance period.

If a railroad already has ENS signs in place on the effective date, but the placement of those signs does not comply with the requirements set forth in proposed § 234.311, the railroad has five years from the effective date of the final rule to ensure the placement of the signs conforms to proposed § 234.311. If the railroad changes the placement of the sign before the expiration of the five-year period, the placement of the sign must conform to proposed § 234.311. Furthermore, if a railroad replaces a sign before the expiration of the five-year period so that the sign conforms to proposed § 234.309 and the placement of the sign does not conform to proposed § 234.311, the railroad must also change the placement of the sign so that it conforms to proposed § 234.311.

FRA is considering whether to reduce the amount of time that the railroad would have to bring the placement of the sign into compliance if the only sign at the crossing is placed on the signal bungalow. As mentioned previously, signs placed on a signal bungalow are not considered to be conspicuous to the grade crossing user; therefore, FRA believes that giving the railroad five years to replace signs on the bungalow may be excessive and is considering reducing this period to 18 months. FRA welcomes comments regarding reducing the compliance period from five years to 18 months.

If a railroad already conducts recordkeeping as part of its ENS on the effective date, but the recordkeeping does not conform to proposed § 234.313, the railroad has six months from the effective date of the final rule to ensure that the recordkeeping conforms to proposed § 234.313.

This proposed rule has been evaluated in accordance with existing policies and procedures and determined to be non-significant under both Executive Order 12866 and 13563 and DOT policies and procedures. See 44 FR 11034; February 26, 1979. FRA has prepared and placed in the docket a regulatory evaluation addressing the economic impact of this proposed rule. FRA has met with and made presentations to those who are likely to be affected by this rule in order to seek their views on the rule.

As part of the regulatory evaluation, FRA has assessed quantitative measurements of the cost streams expected to result from the implementation of this proposed rule. For the 20-year period analyzed, the estimated quantified cost that would be imposed on industry totals $36.6 million with a present value (PV, 7 percent) of $18.9 million. The requirements that are expected to impose the largest burdens relate to recordkeeping and the purchase and installation of signs at grade crossings. The table below presents the estimated costs associated with the proposed rulemaking.

As part of the regulatory evaluation, FRA has explained what the likely benefits for this proposed rule would be, and provided numerical assessments of the potential value of such benefits. The proposed rulemaking is expected to improve railroad safety by ensuring that all highway-rail and pathway grade crossings have adequate signage to enable the public to inform the railroad of emergencies and other unsafe conditions. The primary benefits include a heightened safety environment in grade crossing areas and potential avoidance of casualties, fatalities, and damage through earlier awareness of track obstructions, including stalled highway vehicles, and other safety hazards. Thus, in general, the proposed rule should decrease grade crossing accidents and incidents and associated casualties and damages. FRA believes the value of the anticipated safety benefits would meet or exceed the cost of implementing the proposed rule. Over a 20-year period, this analysis finds that $49.2 million in cost savings would accrue through casualty prevention and damage avoidance. The discounted value of this is $23.4 million (PV, 7 percent). The table below presents the estimated benefits associated with the proposed rule.

The Regulatory Flexibility Act of 1980 (5 U.S.C. 601 et seq. ) and Executive Order 13272 (67 FR 53461; August 16, 2002) require agency review of proposed and final rules to assess their impact on small entities. The Regulatory Flexibility Act requires an agency to review regulations to assess their impact on small entities. An agency must conduct a regulatory flexibility analysis unless it determines and certifies that a rule is not expected to have a significant impact on a substantial number of small entities. Pursuant to the Regulatory Flexibility Act of 1980, 5 U.S.C. 605(b), the FRA Administrator certifies that this proposed rule will not have a significant economic impact on a substantial number of small entities. No small railroads will be affected by the rule. FRA has prepared and placed in the docket this certification. FRA requests comments on this certification as well as all other aspects of this NPRM.

“Small entity” is defined in 5 U.S.C. 601 as including a small business concern that is independently owned and operated, and is not dominant in its field of operation. The U.S. Small Business Administration (SBA) has authority to regulate issues related to small businesses, and stipulates in its size standards that a “small entity” in the railroad industry is a for profit “line-haul railroad” that has fewer than 1,500 employees, a “short line railroad” with fewer than 500 employees, or a “commuter rail system” with annual receipts of less than seven million dollars. See “Size Eligibility Provisions and Standards,” 13 CFR part 121, subpart A. Additionally, 5 U.S.C. 601(5) defines as “small entities” governments of cities, counties, towns, townships, villages, school districts, or special districts with populations less than 50,000. Federal agencies use a different standard for small entities, in consultation with SBA and in conjunction with public comment. Pursuant to that authority FRA has published a final statement of agency policy that formally establishes “small entities” or “small businesses” as being railroads, contractors and hazardous materials shippers that meet the revenue requirements of a Class III railroad as set forth in 49 CFR 1201.1-1, which is $20 million or less in inflation-adjusted annual revenues, and commuter railroads or small governmental jurisdictions that serve populations of 50,000 or less. See 68 FR 24891, May 9, 2003, codified at appendix C to 49 CFR part 209. The $20-million limit is based on the Surface Transportation Board's revenue threshold for a Class III railroad. Railroad revenue is adjusted for inflation by applying a revenue deflator formula in accordance with 49 CFR 1201.1-1. FRA is using this definition for this rulemaking.

Certain provisions of this proposed rule would apply to all railroads that dispatch trains over highway-rail or pathway grade crossings. Out of the 674 Class III railroads, FRA estimates there are 117 small railroads that do not have a dispatching function as part of their operations and, therefore, would not be affected by these certain provisions of this regulation. Therefore, FRA has concluded that 557 small railroads would be affected by those provisions of this rule. However, the impact on these small railroads would not be significant.

Other provisions of this proposed rule would require railroads that own track at highway-rail or pathway grade crossings (or maintain grade crossing signal warning systems at such crossings per rule text) to incur fixed costs, such as the purchase of signs and posts, which are directly proportional to the number of crossings. Additionally, the number of calls received is also expected to be proportional to the number of highway-rail or pathway grade crossings owned or maintained by each railroad.

Smaller railroads generally have fewer highway-rail or pathway grade crossings than larger railroads do. Although each grade crossing may have the same probability of being the subject of an ENS-generated call, the total burden on smaller railroads should be smaller, when implementing and complying with the major requirements of purchasing signage and recordkeeping. For example, FRA has found that there are 137 extremely small railroads, accounting for 4,408 grade crossings. On average, each of the 137 railroads has approximately 32 grade crossings. Additionally, the average total implementation cost for these railroads is approximately $2,300 per railroad for the first year and $519 per railroad per year for each of the following 14 years. Expressed differently, the cost for these railroads to comply with this proposed rule is about $72 per crossing per railroad for the first year and approximately $16 per crossing per railroad for each of the following 14 years. Railroads with just a few crossings would incur minimal costs to comply with this proposed rule. Thus, FRA believes that this proposed regulation would not have a significant impact on these railroads.

Some small railroads are subsidiaries of large short-line holding companies with the expertise and resources comparable to larger railroads. The proposed requirements to install two new signs per highway-rail or pathway grade crossing and provide a toll-free telephone number to report emergencies and other unsafe conditions would not have a significant impact on these railroads. Short lines affected by this proposed rule might collaborate with other small railroads to jointly implement its requirements, which would lower the burden on these small railroads.

Previously, FRA sampled small railroads and found that revenue averaged approximately $4.7 million (not discounted) in 2006. One percent of average annual revenue per small railroad, or $47,000, is far less than the average annual cost that these railroads would incur because of this proposed rule. FRA concludes that the proposed burden would not have a noticeable impact on the competitive position of small entities, or on the small entity segment of the railroad industry as a whole.

Pursuant to the Regulatory Flexibility Act (5 U.S.C. 601(b)), FRA certifies that this proposed rule would not have a significant impact on a substantial number of small entities. Although a substantial number of small railroads would be affected by the proposed rule, these entities would be significantly impacted. A more thorough discussion on the basis of this certification can be found in Appendix B of the Regulatory Evaluation, which has been submitted to the docket for this proposed rulemaking. FRA invites all interested parties to submit data and information regarding the potential economic impact that would result from adoption of the proposals in this NPRM. FRA will consider all comments received in the public comment process when making a final determination for certification of the final rule.

Executive Order 13132, “Federalism” (64 FR 43255, Aug. 10, 1999), requires FRA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” are defined in the Executive Order to include regulations 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.” Under Executive Order 13132, the agency may not issue a regulation with federalism implications that imposes substantial direct compliance costs and that is not required by statute, unless the Federal government provides the funds necessary to pay the direct compliance costs incurred by State and local governments, the agency consults with State and local governments, or the agency consults with State and local government officials early in the process of developing the regulation. Where a regulation has federalism implications and preempts State law, the agency seeks to consult with State and local officials in the process of developing the regulation.

This NPRM has been analyzed in accordance with the principles and criteria contained in Executive Order 13132. FRA has determined that the proposed rule will not have substantial direct effects on the States, on the relationship between the national government and the States, nor on the distribution of power and responsibilities among the various levels of government. In addition, FRA has determined that this proposed rule will not impose substantial direct compliance costs on State and local governments. Therefore, the consultation and funding requirements of Executive Order 13132 do not apply.

This NPRM amends part 234, which contains FRA principal regulations regarding grade crossing safety. Although the final rule on State-specific highway-rail grade crossing action plans published June 28, 2010 (75 FR 36552) removed the preemptive effect provision in part 234, FRA notes that this part could have preemptive effect by the operation of law under a provision of the former Federal Railroad Safety Act of 1970 (former FRSA), that is, 49 U.S.C. 20106 (Sec. 20106). Sec. 20106 provides that States may not adopt or continue in effect any law, regulation, or order related to railroad safety or security that covers the subject matter of a regulation prescribed or order issued by the Secretary of Transportation (with respect to railroad safety matters) or the Secretary of Homeland Security (with respect to railroad security matters), except when the State law, regulation, or order qualifies under the “essentially local safety or security hazard” exception to Sec. 20106.

In sum, FRA has analyzed this proposed rule in accordance with the principles and criteria contained in Executive Order 13132. As explained above, FRA has determined that this proposed rule has no federalism implications, other than the preemption of State laws covering the subject matter of this proposed rule, which occurs by operation of law under 49 U.S.C. 20106 whenever FRA issues a safety rule or order. Accordingly, FRA has determined that preparation of a federalism summary impact statement for this proposed rule is not required.

The Trade Agreement Act of 1979 prohibits Federal agencies from engaging in any standards or related activities that create unnecessary obstacles to the foreign commerce of the United States. Legitimate domestic objectives, such as safety, are not considered unnecessary obstacles. The statute also requires consideration of international standards and where appropriate, that they be the basis for U.S. standards. This rulemaking is purely domestic in nature and is not expected to affect trade opportunities for U.S. firms doing business overseas or for foreign firms doing business in the United States.

The information collection requirements in this proposed rule have been submitted for approval to the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995, 44 U.S.C. 3501 et seq. The sections that contain the new information collection requirements are duly designated, and the estimated time to fulfill each requirement is as follows:

All estimates include the time for reviewing instructions; searching existing data sources; gathering or maintaining the needed data; and reviewing the information. Pursuant to 44 U.S.C. 3506(c)(2)(B), FRA solicits comments concerning the following issues: whether these information collection requirements are necessary for the proper performance of the functions of FRA, including whether the information has practical utility; the accuracy of FRA's estimates of the burden of the information collection requirements; the quality, utility, and clarity of the information to be collected; and whether the burden of collection of information on those who are to respond, including through the use of automated collection techniques or other forms of information technology, may be minimized. For information or a copy of the paperwork package submitted to OMB, contact Mr. Robert Brogan, Information Clearance Officer, at 202-493-6292, or Ms. Kimberly Toone at 202-493-6132.

Organizations and individuals desiring to submit comments on the collection of information requirements should direct them to Mr. Robert Brogan or Ms. Kimberly Toone, Federal Railroad Administration, 1200 New Jersey Avenue, SE., 3rd Floor, Washington, DC 20590. Comments may also be submitted via e-mail to Mr. Brogan or Ms. Toone at the following address: Robert.Brogan@dot.gov; Kimberly.Toone@dot.gov

OMB is required to make a decision concerning the collection of information requirements contained in this proposed rule between 30 and 60 days after publication of this document in the Federal Register . Therefore, a comment to OMB is best assured of having its full effect if OMB receives it within 30 days of publication. The final rule will respond to any OMB or public comments on the information collection requirements contained in this proposal.

FRA is not authorized to impose a penalty on persons for violating information collection requirements which do not display a current OMB control number, if required. FRA intends to obtain current OMB control numbers for any new information collection requirements resulting from this rulemaking action prior to the effective date of the final rule. The OMB control number, when assigned, will be announced by separate notice in the Federal Register .

FRA has evaluated this proposed rule in accordance with its “Procedures for Considering Environmental Impacts” (FRA's Procedures) (64 FR 28545, May 26, 1999) as required by the National Environmental Policy Act (42 U.S.C. 4321 et seq. ), other environmental statutes, Executive Orders, and related regulatory requirements. FRA has determined that this proposed rule is not a major FRA action (requiring the preparation of an environmental impact statement or environmental assessment) because it is categorically excluded from detailed environmental review pursuant to section 4(c)(20) of FRA's Procedures. ( See 64 FR 28547, May 26, 1999.) Section 4(c)(20) reads as follows: “(c) Actions categorically excluded. Certain classes of FRA actions have been determined to be categorically excluded from the requirements of these Procedures as they do not individually or cumulatively have a significant effect on the human environment. * * * The following classes of FRA actions are categorically excluded: * * * (20) Promulgation of railroad safety rules and policy statements that do not result in significantly increased emissions or air or water pollutants or noise or increased traffic congestion in any mode of transportation.”

In accordance with section 4(c) and (e) of FRA's Procedures, the agency has further concluded that no extraordinary circumstances exist with respect to this regulation that might trigger the need for a more detailed environmental review. As a result, FRA finds that this proposed rule is not a major Federal action significantly affecting the quality of the human environment.

Pursuant to Section 201 of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4, 2 U.S.C. 1531), each Federal agency “shall, unless otherwise prohibited by law, assess the effects of Federal regulatory actions on State, local, and Tribal governments, and the private sector (other than to the extent that such regulations incorporate requirements specifically set forth in law).” Section 202 of the Act (2 U.S.C. 1532) further requires that “before promulgating any general notice of proposed rulemaking that is likely to result in the promulgation of any rule that includes any Federal mandate that may result in 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 1 year, and before promulgating any final rule for which a general notice of proposed rulemaking was published, the agency shall prepare a written statement” detailing the effect on State, local, and Tribal governments and the private sector. For the year 2010, this monetary amount of $100,000,000 has been adjusted to $140,800,000 to account for inflation. This proposed rule would not result in the expenditure of more than $140,800,000 by the public sector in any one year, and thus preparation of such a statement is not required.

Executive Order 13211 requires Federal agencies to prepare a Statement of Energy Effects for any “significant energy action.” 66 FR 28355 (May 22, 2001). Under the Executive Order, a “significant energy action” is defined as any action by an agency (normally published in the Federal Register ) that promulgates, or is expected to lead to the promulgation of, a final rule or regulation (including a notice of inquiry, advance notice of proposed rulemaking, and notice of proposed rulemaking) that (1)(i) is a significant regulatory action under Executive Order 12866 or any successor order and (ii) is likely to have a significant adverse effect on the supply, distribution, or use of energy; or (2) is designated by the Administrator of the Office of Information and Regulatory Affairs as a significant energy action. FRA has evaluated this NPRM in accordance with Executive Order 13211. FRA has determined that this NPRM will not have a significant adverse effect on the supply, distribution, or use of energy. Consequently, FRA has determined that this regulatory action is not a “significant energy action” within the meaning of Executive Order 13211.

Interested parties should be aware that anyone is able to search the electronic form of all comments received into any agency docket by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc. ). You may review DOT's complete Privacy Act Statement in the Federal Register published on April 11, 2000 (Volume 65, Number 70; Pages 19477-78), or you may visit http://www.regulations.gov.

In consideration of the foregoing, FRA proposes to amend part 234 of chapter II, subtitle B of title 49, Code of Federal Regulations, as follows: