[Federal Register Volume 77, Number 100 (Wednesday, May 23, 2012)]
[Notices]
[Pages 30542-30546]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-12555]


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DEPARTMENT OF HOMELAND SECURITY

Transportation Security Administration

[Docket Nos. TSA-2004-19515 and TSA-2009-0018]
RIN 1652-AA64


Air Cargo Screening Fees

AGENCY: Transportation Security Administration, DHS.

ACTION: Notice of fees.

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SUMMARY: This notice establishes user fees for certain security threat 
assessments (STAs) performed by the Transportation Security 
Administration (TSA). In the Air Cargo Screening final rule published 
on August 18, 2011, TSA proposed a fee range for security threat

[[Page 30543]]

assessments of between $31 and $51 and sought comment on the fee range 
and on the methodology used to calculate the fee. The final rule stated 
that TSA would announce the final fee amount in a notice in the Federal 
Register. This notice establishes a fee of $41 for certain security 
threat assessments in the air cargo program and responds to public 
comments made regarding the fee range.

DATES: Effective June 22, 2012.

FOR FURTHER INFORMATION CONTACT: Michael Gambone, Director of Revenue, 
TSA-14, Transportation Security Administration, 601 South 12th Street, 
Arlington, VA 20598-6014; telephone (571) 227-2323; facsimile (571) 
227-2904; email [email protected].

SUPPLEMENTARY INFORMATION: 

Availability of Document

    You can get an electronic copy using the Internet by--
    (1) Searching the electronic Federal Docket Management System 
(FDMS) web page at http://www.regulations.gov;
    (2) Accessing the Government Printing Office's web page at http://www.gpo.gov/fdsys/browse/collection.action?collectionCode=FR to view 
the daily published Federal Register edition; or accessing the ``Search 
the Federal Register by Citation'' in the ``Related Resources'' column 
on the left, if you need to do a Simple or Advanced search for 
information, such as a type of document that crosses multiple agencies 
or dates; or
    (3) Visiting TSA's Security Regulations web page at http://www.tsa.gov and accessing the link for ``Research Center'' at the top 
of the page.
    In addition, copies are available by writing or calling the 
individual in the FOR FURTHER INFORMATION CONTACT section. Make sure to 
identify the docket number of this rulemaking.

Background

    On May 26, 2006, TSA issued the Air Cargo Security Requirements 
final rule (2006 rulemaking),\1\ which, in part, required certain cargo 
workers of aircraft operators, foreign air carriers, and indirect air 
carriers (IACs) to undergo an STA conducted by TSA. TSA checks a 
variety of government databases to verify the individual's identity and 
determine that he or she does not pose a security threat to 
transportation or national security. TSA is authorized to collect fees 
to offset the cost of conducting STAs. 6 U.S.C. 469. The 2006 
rulemaking established a fee for STAs of $28, and incorporated the fee 
amount in the civil aviation security regulation. 49 CFR 1540.209.
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    \1\ 71 FR 30478.
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    On September 16, 2009, TSA published the Air Cargo Screening 
interim final rule (IFR) (2009 IFR),\2\ which establishes requirements 
for certain additional individuals to obtain an STA. These individuals 
are certified cargo screening facilities (CCSF) employees and 
authorized representatives that screen cargo, and have unescorted 
access to screened cargo or carry out certain other cargo security 
duties.
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    \2\ 74 FR 47672.
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    The 2009 IFR amended Sec.  1540.209 to remove the specific fee 
amount from the regulatory text. In the preamble to the 2009 IFR, we 
described how TSA would calculate the fee for STAs and stated that the 
fee would be between $13 and $21, depending on the size of the 
population and whether there are changes to the costs involved in the 
calculation. TSA explained that TSA would publish specific fee amounts 
and changes to fee amounts as a notice in the Federal Register.\3\ We 
invited comment on the new proposed fee, and the methodology and 
population estimates we used to arrive at the proposed fee. Since the 
issuance of the IFR, TSA has not charged a fee for STA processing, 
because the specific fee amount was removed from the regulatory text 
and was not published elsewhere.
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    \3\ 74 FR 47684.
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    TSA has further reviewed costs and population data since the IFR 
was issued. On August 18, 2011, TSA published the Air Cargo Screening 
final rule (2011 rule) \4\ that responded to comments received on the 
IFR. The 2011 rule also explained that due to significant decreases in 
the population estimate, the fee necessary to recover TSA's costs of 
conducting threat assessments would increase. TSA proposed a new fee 
range between $31 and $51. We invited comment on the new proposed fee, 
and the methodology we used to arrive at the new proposed fee range. 
The 2011 rule stated that TSA would publish specific fee amounts and 
changes to fee amounts as a notice in the Federal Register.\5\
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    \4\ 76 FR 51848. Section 1540.209 of the 2006 rulemaking stated 
that a fee of $28 is required for TSA to conduct an STA. The 2009 
IFR, however, revised Sec.  1540.209 so that the regulation no 
longer contains a specific fee amount. Section 1540.209 now states 
that TSA will publish fee amounts and any revisions to the fee 
amounts as a notice in the Federal Register.
    \5\ 76 FR 51857.
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    The 2011 rule also stated that the ``Air Cargo Screening Security 
Threat Assessment Fee Development Report'' (Fee Report) provided 
additional detailed information regarding the fee. However, TSA 
inadvertently omitted to place the report in the public docket. 
Accordingly, on August 25, 2011, TSA published a correction notice in 
the Federal Register (August 25 notice) \6\ explaining the omission and 
indicating that TSA placed the Fee Report in the public docket and 
reopened the comment period on the fee for an additional 30 days. TSA 
responds to comments submitted on the fee below.
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    \6\ 76 FR 53080.
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Fee Amount

    By this notice, TSA announces the final fee of $41 for STAs for 
employees of aircraft operators, foreign air carriers, IACs, and CCSFs 
who have or are applying for unescorted access to cargo to be 
transported on passenger aircraft, screen cargo, supervise the 
screening of cargo, or perform certain other security functions as 
provided for in Sec.  1540.201(a).
    As TSA explained in the 2011 rule,\7\ changes in the population 
estimates necessitated that TSA propose an increase in the fee range to 
$31 to $51.\8\ In summarizing the changes from the 2009 IFR to the 2011 
rule, the five-year cost estimate for threat assessment services 
increased by approximately $4.2 million, and the five-year population 
estimate decreased significantly by approximately 551,000. Because of 
the substantial decrease in population, there will be fewer applicants 
from which fixed costs of threat assessment services can be recovered, 
thereby increasing the per applicant fee. To recover the full cost of 
the STA services from the estimated population described in Sec.  
1540.201, TSA is announcing a fee of $41.
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    \7\ 76 FR 51857.
    \8\ In the 2009 IFR, the fee range was $13 to $21.
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    Pursuant to the Chief Financial Officers Act of 1990 (Pub. L. 101-
576, 104 Stat. 2838, Nov. 15, 1990), TSA is required to review fees no 
less than every two years. 31 U.S.C. 3512. Upon review, if TSA finds 
that the fees are either too high (that is, total fees exceed the total 
cost to provide the services) or too low (that is, total fees do not 
cover the total costs to provide the services), TSA will adjust the fee 
accordingly.

Comments on the STA Fee Calculation and Other Issues Relating to STAs

    TSA received comments from 13 commenters on the 2011 rule and the 
August 25 notice relating to the STA fee. These comments are addressed 
below.

[[Page 30544]]

STA Fees

    Comment: Several commenters expressed the concern that the proposed 
fee range is excessive and too expensive for industry to bear, 
especially at this time of economic downturn. One commenter stated that 
the fee amount for the name checks component of the fee was 
disproportionate to the level of administrative costs the agency incurs 
by checking names against terrorists data bases. Additional commenters 
believed that an average annual personnel cost of $134,000 is 
overstated.
    Another commenter maintained that the information technology 
platform/systems component of the fee was unnecessary, as this system 
has been in place since 2006, and the commenter believes that TSA 
should not charge for the development of a system already in place.
    One commenter asserted that a search of the applicant's name 
through various databases is primarily conducted by electronic means, 
not requiring a large amount of personnel, and that other necessary 
functions for the STA are carried out by IACs/CCSFs' Security 
Coordinators, further reducing TSA's need for personnel in the STA 
process. A commenter suggested that if TSA would allow submission of 
names in batch format, versus one at a time, less staff would be needed 
for the name check.
    TSA Response: While TSA recognizes the STA fee will impose a new 
financial burden on the industry during a period of economic stress, 
TSA is required by statute to collect fees to recover all costs of 
conducting vetting and credentialing services. 6 U.S.C. 469. As part of 
this Congressional mandate, TSA works within Federal guidelines to 
ensure the most efficient use of resources to minimize the cost of 
vetting services. The STA fee is set to recover only the cost of 
vetting services being provided to STA applicants, and better aligns 
cost recovery from those that directly benefit from this unique 
security service. Further, TSA conducts regular reviews to ensure that 
fees are set to recover the full cost of vetting services.
    TSA used actual cost data from 2009 to determine that the average 
annual fully burdened \9\ cost of personnel necessary for this vetting 
service was $134,000. TSA used this actual figure to estimate future 
personnel costs accurately over the five-year period of the cost model.
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    \9\ The fully burdened employee cost is comprised of salary and 
benefits that include such items as the Government's contributions 
to an employee's health insurance, life insurance, and retirement.
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    While TSA can accomplish a portion of the vetting process using 
information technology, there is a substantial need for human resources 
to ensure timely, complete, and accurate vetting results. On average, 
TSA expects to process over 300 applicants each and every calendar day 
over the next five years. Such volume necessitates that various 
personnel carry out the multitude of threat assessment functions during 
the vetting process.
     Vetting Managers--establish, implement, operate, and 
monitor best practices necessary for efficient threat assessments.
     Vetting Analysts--provide a wide range of communications, 
operations, and administrative activities, including written 
correspondence, budgetary formulation and execution, programmatic 
standards and procedures.
     Transportation Security Specialists--provide analysis of 
vetting results and remediation of incomplete data or incorrect data.
     Technology Specialists--manage data ingest, processing, 
and reporting for the STA process. Duties include program architecture, 
requirements development and implementation, data information 
assurances and procedures, and completion of risk and vulnerability 
assessments.
     Business Management Specialists--manage administrative 
services that include budget formulation/execution, human resource 
management, training, and day-to-day office needs.
    TSA estimates that personnel costs will average approximately $2.6 
million in each of the first five years of the program. Over that same 
period, TSA estimates that over 130,000 individuals will apply for STA 
services annually. Accordingly, TSA will need to recover approximately 
$20 from each applicant to recover personnel costs fully.
    A robust technical platform ensures accurate and efficient threat 
assessment services. While TSA will capitalize on infrastructure 
investments already made to implement prior STA services, new 
technology investments are necessary to modify existing capacity and to 
develop further capabilities. For example, the technology platform 
needs to be enhanced to integrate an STA with a five-year duration and 
to provide sustained operational redundancy.
    With regard to the comment that TSA should allow submission of 
names in batch, the current system will only allow submission of 
information for one individual at a time.
    Comment: One association feared that a large percentage of their 
freight forwarders that are small businesses would pass the cost to 
their shipper clients, thereby increasing the cost of transportation. 
Another commenter complained that STA fees are particularly burdensome 
to the trucking industry that CCSP participants rely on to transport 
their cargo. According to this commenter, given the high employee 
turnover that trucking companies often experience, high STA fees may 
cause truck drivers transporting cargo to opt out of the business 
thereby reducing competition.
    One commenter was concerned that they not only have to submit and 
pay STAs for their direct employees but also for those of any of their 
authorized agents. This commenter suggested TSA should allow an 
authorized agent to submit and pay for their own STAs, and that TSA 
should regulate all non-IAC entities, such as haulers and ground 
handling agents, so that they can share in the costs of securing 
transportation.
    TSA Response: TSA agrees that some entities may pass on the costs 
of STA fees to their customers. However, since the STA requirement 
applies to all populations included in this fee calculation, TSA 
believes small businesses will not be put at a competitive 
disadvantage. For more information, see Appendix A (page 153), Economic 
Impacts on Existing CCSFs by Size, in the Regulatory Evaluation 
accompanying the 2011 rule.
    TSA believes STA fees will not be overly burdensome to the trucking 
industry. The STA requirement does not produce a competitive advantage 
for any specific firm because the STA requirement applies to all 
trucking entities carrying screened cargo for CCSFs. TSA does not 
prescribe how companies must finance STA costs. A firm may decide to 
pay for the STAs, charge employees, or pass on the costs to the CCSFs. 
In addition, an STA is valid for five years regardless of place of 
employment, so drivers will not have to undergo an additional STA until 
their current STA expires.
    TSA is currently developing enhancements to the existing Indirect 
Air Carrier Management System (IACMS) that will enable the authorized 
agent to process and pay for their own STAs. At this time, TSA has no 
plans to expand the scope of the regulations to include other entities 
beyond the air carriers, IACs, and CCSFs.
    Comment: An association commented that the cost of the STA fee is 
high because the current STA system is highly flawed and redundant. For 
example, IACs provide TSA names for STAs, many of which have been 
supplied several times over by other IACs. This association recommends 
that

[[Page 30545]]

TSA build a ``hosting portal'' through which IACs can access a database 
to determine whether an additional filing by a particular IAC is 
needed.
    TSA Response: The existing TSA portal for validating an STA enables 
any regulated party with access to the IACMS to view and validate a 
current STA in their profile without the need to resubmit payment and 
process a new STA. Thus, TSA does not require that an individual obtain 
more than one STA. Rather, the decision of whether to require an 
individual to obtain more than one STA is a business decision made by 
regulated parties.
    Comments: Several commenters believe that TSA grossly 
underestimated the population of those subject to STAs by limiting the 
population to IACs and certified cargo screening program (CCSP) 
participants. These commenters indicated that TSA must include all 
entities that are subject to STA requirements, not merely those in the 
CCSP. These commenters stated that other components of the aviation and 
cargo industry, such as employees of full all-cargo carriers, passenger 
air carriers, airports, and trucking companies, requiring STAs should 
be included in this fee calculation. According to these commenters, TSA 
would be able to leverage existing technology and infrastructure and 
thereby process fees at lower costs.
    One commenter was concerned that TSA did not include direct air 
carrier employees subject to the STA requirements, but who receive them 
at no extra cost, as part of the requirement to obtain Security 
Identification Display Area (SIDA) IDs.
    Another commenter requested that if TSA intends to limit the 
population to IACs and other CCSP participants, then TSA should clearly 
limit applicability of the proposed fees to those persons engaged in 
the CCSP. Another commenter submitted that even within the IAC and CCSP 
groups, the fee report estimates of 1,000 STAs that would be needed for 
``super'' \10\ shippers was too low.
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    \10\ For further information on the categorization of shippers, 
refer to the Fee Report. In the Fee Report on page 13, TSA describes 
the categorization of shippers as small, medium, large, and super.
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    TSA Response: TSA appreciates the questions regarding which 
populations are included in the STA fee, and provides clarification of 
TSA's population estimates below. In the 2011 rule, TSA combined 
populations from the 2006 rule including personnel of aircraft 
operators, foreign air carriers, and IACs with unescorted access to 
cargo, with the CCSF population. To estimate the size of the ``IAC'' 
population for the 2011 rule, TSA used the actual historical number of 
STA enrollments of aircraft operator, foreign air carrier, and IAC 
personnel. Thus, the population estimate in the 2011 rule properly 
considers not only IAC personnel, but also personnel of aircraft 
operators handling cargo off airport, all-cargo operators, foreign air 
carriers, and CCSFs.\11\ Therefore, since the STA fee takes into 
account all the population segments noted above, it is not limited to 
IACs and CCSFs.
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    \11\ While the 2011 rule and the Fee Report used the terms 
``IACs'' and ``CCSFs'' to describe the populations used to determine 
the fee, TSA has verified that the actual populations used to 
calculate the fee include personnel of aircraft operators, foreign 
air carriers, and all-cargo operators, as well as CCSFs. TSA also 
notes that the Regulatory Evaluation only considers the STA costs 
imposed by the 2009 IFR and 2011 rule, and thus only addresses the 
costs of an STA for CCSFs.
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    The cost and population estimates for airport personnel required to 
obtain SIDA IDs were not included in the fee models for this rulemaking 
because STAs for holders of SIDA IDs require different processes within 
TSA and it would not be appropriate to include these STA holders in the 
population estimates for determining the STA fee. TSA may address this 
population in a future rulemaking.
    CCSF STA projections in the 2011 rule, including those for 
``super'' shippers, were based on expected firm enrollment into the 
CCSP. The 1,000 STAs per super shipper was TSA's best estimate at the 
time the 2011 rule was completed. This estimate is an average, with 
some super shippers requiring more and some requiring fewer STAs.
    Comment: One commenter stated that it did not make sense that a 
decrease in the population results in an increase in the STA fee.
    TSA Response: The STA fee is set to recover fully the cost of the 
services provided to STA applicants. As such, the fee reflects both the 
service costs and the number of beneficiaries receiving services. It is 
important to note that a large portion of the estimated service costs 
are fixed and do not vary based on the number of estimated applicants. 
In addition, there are half as many applicants in the 2011 rule from 
which the sustained service costs must be recovered. This, in turn, 
caused the fee per person to increase.
    Comment: A number of commenters stated that it is incorrect for TSA 
to assume that the private sector should bear 100 percent of all costs 
related to the STA process. According to such commenters, security is 
an inherently governmental function, and it is reasonable to assume 
that public funds should cover at least some portion of the STA costs. 
Another commenter argued that the private sector is already bearing a 
significant portion of the costs of the STA by managing the process to 
provide and update information on its employees.
    TSA Response: TSA is required to collect fees to offset all costs 
of providing credentialing and background investigations in accordance 
with 6 U.S.C 469. As part of this mandate, TSA will work within Federal 
guidelines to ensure the most efficient use of resources to minimize 
the cost of vetting services. Further, TSA is mandated by statute to 
review fees no less than every two years to ensure that fees are set to 
recover the full cost of vetting services. If the fees are too high or 
too low, TSA will adjust the fee.
    Comment: One commenter alleges that TSA has violated the terms of 
Executive Order 13563 (EO 13563) because the Regulatory Evaluation for 
the 2011 rule does not separately address the costs and benefits of the 
STA fee. This same commenter argues that TSA never considered 
alternative methods of conducting STAs, as required by EO 13563, 
including the use of outside contractors that might perform the 
required checks for substantially less.
    TSA Response: TSA does not agree that it violated the terms of EO 
13563. The STA fee is an integral part of the implementation of the 
2011 rule as it provides the funding to offset the costs of vetting 
services being provided to STA applicants. As we have previously 
discussed, TSA is required to recover all costs of conducting vetting 
and credentialing services by 6 U.S.C. 469. Consequently, the benefits 
of the fee include providing the full funding TSA needs to operate the 
program and allowing TSA to comply with the requirement to recover all 
costs of providing this unique service. TSA's Regulatory Evaluation 
included an analysis of alternatives to achieving 100 percent screening 
of cargo transported on passenger aircraft; TSA compared the 
alternative of 100 percent screening solely by air carriers to the 
alternative of screening by participants of the CCSP program as well as 
air carriers, as established in the 2009 IFR. Both alternatives 
encompass a requirement that personnel with unescorted access to cargo 
successfully complete an STA conducted by TSA.
    Finally, only the Federal Government can access the consolidated 
Terrorist Screening Database (TSDB), and must first enter into a 
Memorandum of Understanding with the Federal Bureau of Investigation 
(FBI) with very specific

[[Page 30546]]

access privileges and justifications. Private entities such as outside 
contractors are not provided access. Checking applicants against the 
TSDB is a central feature of the STA that TSA conducts.
    Comment: Some commenters submitted that TSA should not base such 
fees on inexact estimates of the actual costs or the number of STAs 
that will be required, and should hold the STA fee in abeyance until 
TSA has further dialogue with industry. Other commenters recommended 
that TSA wait to charge an STA fee until issuance of the Standardized 
Vetting, Adjudication, and Redress rule that TSA is developing.
    TSA Response: Under 6 U.S.C. 469, TSA is currently required to fund 
vetting and credentialing programs through user fees. The STA fee is an 
important part of TSA's compliance with this Congressional mandate. 
Moreover, TSA does have sufficient information to make a reasonable 
estimate and has shared that information in the 2011 rule. For these 
reasons, TSA concludes that it would be inappropriate to delay 
implementation of the STA fee.
    With regard to the Standardized Vetting, Adjudication, and Redress 
Services rulemaking to which the commenter refers, TSA notes that this 
initiative is still in the developmental stages, and is not, therefore, 
a reasonable basis for delaying any part of this rulemaking.
    Finally, in addition to the extensive dialogue and industry 
outreach that TSA conducted in the development of air cargo security 
policy, industry has had the opportunity to comment on this STA fee 
through notice-and-comment rulemaking.

Other STA Issues

    Comment: A commenter stated that their organization conducts 
Criminal History Background Checks on all prospective employees, and 
that although these checks are not fingerprint-based checks, they are 
exhaustive. Accordingly, to avoid duplication of time, effort, and 
cost, the commenter requested that TSA accept such background checks in 
lieu of STAs.
    TSA Response: TSA does not believe that the name-based criminal 
check that the commenter's organization conducts is comparable to the 
STA TSA conducts on this population and is not sufficient to provide 
the necessary level of security needed in this industry. The STA TSA 
conducts includes matching names against the consolidated TSDB and 
other Government data sources, to which private entities do not have 
access. These databases contain information relating to terrorist 
activity, most of which is not criminal history information.
    Comment: One commenter stated that the TSA criminal history records 
check (CHRC) provides a greater degree of security than the STA 
requirements, and that to bring congruency among the STA requirements, 
TSA ought to require CHRCs immediately for workers with unescorted 
access to cargo.
    TSA Response: As TSA stated in the response to comments in the 2011 
rule,\12\ TSA agrees that CHRCs add a level of security to the name-
based STA requirement. TSA intends to address the CHRC requirement in 
the broader context of all TSA programs.
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    \12\ 76 FR 51854.
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    Comment: One commenter appreciated TSA's recognition that the STAs 
performed under the SIDA, Commercial Driver's License-Hazardous 
Material Endorsement, Transportation Workers Identification Card, and 
Free and Secure Trade programs have been deemed comparable to STAs 
performed under the CCSP. This commenter states that it is not clear 
whether a CCSP facility operator is relieved of the burden to submit 
personal identifying information for each individual who has been 
vetted under these comparable programs, because the CCSP is designed on 
a facility-specific basis rather than an individual enrollment basis. 
This commenter believes that TSA should be moving toward a common 
program platform for security vetting programs and should grant full 
reciprocity to individuals who have been vetted against the TSDB, no 
matter what program the STA was first required under.
    TSA Response: When an individual asserts that he or she has 
successfully completed an STA comparable to the STA required under the 
2011 rule, TSA requires that the individual present the credential that 
corresponds to the comparable STA to the operator so that the operator 
may retain a copy, and that the individual notify the operator when the 
credential expires. 49 CFR 1540.203(i)(1) and (2). TSA does not require 
the submission of personal identifying information to TSA for an 
individual who has been vetted under a comparable STA.
    As we understand this comment, the commenter suggests that TSA 
should implement a system for conducting and administering STAs that is 
focused on the individual rather than the employer for which, or the 
facility in which, he or she currently works. TSA may consider such a 
process in a future rulemaking.

    Issued in Arlington, Virginia, on May 17, 2012.
John S. Pistole,
Administrator.
[FR Doc. 2012-12555 Filed 5-22-12; 8:45 am]
BILLING CODE 9110-05-P