Executive Order 12866

This final rule has been determined to be not significant for purposes of Executive Order 12866; and, therefore has not been reviewed by the Office of Management and Budget (OMB).

This final rule has been reviewed under Executive Order 12988, Civil Justice Reform. It is not intended to have retroactive effect. There are no administrative procedures that must be exhausted prior to any judicial challenge to the provisions of this rule.

Pursuant to requirements set forth in the Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612), AMS has considered the economic impact of this action on small entities and has determined that its implementation will not have a significant economic impact on a substantial number of small businesses.

The purpose of the RFA is to fit regulatory actions to the scale of businesses subject to such actions so that small businesses will not be disproportionately burdened. There are an estimated 25,000 cotton growers in the U.S. who voluntarily use the AMS cotton classing services annually, and the majority of these cotton growers are small businesses under the criteria established by the Small Business Administration (13 CFR 121.201). Maintaining the user fee at the 2012 crop level as stated will not significantly affect small businesses as defined in the RFA because:

(1) The fee represents a very small portion of the cost per-unit currently borne by those entities utilizing the services. (According to USDA's Economic Research Service, the U.S. average total cost of production in 2011 was $755 per bale. The user fee for classification services of $2.20 per bale represents less the one third percent of this average U.S. per-bale cost of production.);

(2) The fee for services will not affect competition in the marketplace;

(3) The use of classification services is voluntary. For the 2012 crop, 16,800,600 bales were produced; and, almost all of these bales were voluntarily submitted by growers for the classification service; and

(4) Based on the average price paid to growers for cotton from the 2012 crop of 0.7162 cents per pound, 500 pound bales of cotton are worth an average of $358.10 each. The user fee for classification services, $2.20 per bale, is less than one percent of the value of an average bale of cotton.

In compliance with OMB regulations (5 CFR part 1320), which implement the Paperwork Reduction Act (PRA) (44 U.S.C. 3501), the information collection requirements contained in the provisions to be amended by this rule have been previously approved by OMB and were assigned OMB control number 0581-0008, Cotton Classing, Testing, and Standards.

This final rule establishes a 2013 user fee of $2.20 per bale charged to producers for cotton classification—the same level as the 2012 user fee. The 2013 user fee was set in accordance to section 14201 of the Food, Conservation, and Energy Act of 2008 (Pub. L. 110-234) (2008 Farm Bill). Section 14201 of the 2008 Farm Bill provides that: (1) the Secretary shall make available cotton classification services to producers of cotton, and provide for the collection of classification fees from participating producers or agents that voluntarily agree to collect and remit the fees on behalf of the producers; (2) classification fees collected and the proceeds from the sales of samples submitted for classification shall, to the extent practicable, be used to pay the cost of the services provided, including administrative and supervisory costs; (3) the Secretary shall announce a uniform classification fee and any applicable surcharge for classification services not later than June 1 of the year in which the fee applies; and (4) in establishing the amount of fees under this section, the Secretary shall consult with representatives of the United States cotton industry. At pages 313-314, the Joint Explanatory Statement of the committee of conference for section 14201 stated the expectation that the cotton classification fee would be established in the same manner as was applied during the 1992 through 2007 fiscal years. Specifically, it states that the classification fee should continue to be a basic, uniform fee per bale fee as determined necessary to maintain cost-effective cotton classification service. Further, in consulting with the cotton industry, the Secretary should demonstrate the level of fees necessary to maintain effective cotton classification services and provide the Department of Agriculture with an adequate operating reserve, while also working to limit adjustments in the year-to-year fee.

Under the provisions of section 14201, a user fee (dollar amount per bale classed) is established for the 2013 cotton crop that, when combined with other sources of revenue, will result in projected revenues sufficient to reasonably cover budgeted costs—adjusted for inflation—and allow for adequate operating reserves to be maintained. Costs considered in this method include salaries, costs of equipment and supplies, and other overhead costs, such as facility costs and costs for administration and supervision. In addition to covering expected costs, the user fee is set such that projected revenues will generate an operating reserve adequate to effectively manage uncertainties related to crop size and cash-flow timing. Furthermore, the operating reserve is expected to meet minimum reserve requirements set by the Agricultural Marketing Service, which require maintenance of a reserve fund amount equal to at least four months of projected operating costs.

The user fee charged cotton producers for cotton classification in 2013 is $2.20 per bale, which is the same fee charged for the 2012 crop. This fee is based on the preseason projection that 13,250,000 bales will be classed by the United States Department of Agriculture during the 2013 crop year.

Accordingly, § 28.909, paragraph (b) reflects the continuation of the cotton classification fee at $2.20 per bale.

As provided for in the 1987 Act, a 5 cent per bale discount continues to be applied to voluntary centralized billing and collecting agents as specified in § 28.909(c).

Growers or their designated agents receiving classification data continue to incur no additional fees if classification data is requested only once. The fee for each additional retrieval of classification data in § 28.910 remains at 5 cents per bale. The fee in § 28.910 (b) for an owner receiving classification data from the National Database remains at 5 cents per bale, and the minimum charge of $5.00 for services provided per monthly billing period remains the same. The provisions of § 28.910 (c) concerning the fee for new classification memoranda issued from the National Database for the business convenience of an owner without reclassification of the cotton remains the same at 15 cents per bale or a minimum of $5.00 per sheet.

The fee for review classification in § 28.911 is maintained at $2.20 per bale.

The fee for returning samples after classification in § 28.911 remains at 50 cents per sample.

A proposed rule was published in the Federal Register on March 28, 2013, with a comment period of March 28, 2013 through April 12, 2013 (78 FR 18898). AMS received two comments: one from a national trade organization that represents approximately 80 percent of the US cotton industry, including cotton producers, ginners, warehousemen, merchants, cooperatives, cottonseed processors, and textile manufacturers from Virginia to California; and one from a national trade organization comprised of eight state and regional membership organizations that represent approximately 680 individual cotton ginning operations in 17 cotton-producing states. Comments from these national trade organizations expressed support for the decision to maintain the fee at the level established for the 2012 crop. Comments may be viewed at www.regulations.gov.

For the reasons set forth in the preamble, 7 CFR part 28 is amended to read as follows:

This rule is issued under Marketing Order No. 905, as amended (7 CFR part 905), regulating the handling of oranges, grapefruit, tangerines, and tangelos grown in Florida, 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. This rule is not intended to have retroactive effect.

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.

This rule revises the reporting requirements prescribed under the order. This rule requires all fresh citrus handlers to provide the Committee with a list of all growers whose fruit they handled each season. This information will enable the Committee to more efficiently administer the order and better communicate fresh market issues to fresh market citrus growers. This rule was unanimously recommended by the Committee at a July 17, 2012, meeting.

Section 905.71 of the order provides the Committee, with the approval of the Secretary, authority to collect information from handlers that is deemed necessary for administering the order. This rule utilizes this authority to establish a new § 905.171 under the rules and regulations of the order. This new section requires handlers of fresh citrus to report to the Committee a list of names and contact information for all growers whose fruit they have shipped by June 15 of each season.

Prior to this action, the Committee did not require handlers to report any information regarding the growers who supply them. In order to communicate with its grower base regarding the order or Committee actions, the Committee depended on mailing lists from other industry groups. However, third party lists are often incomplete, out-of-date, or do not distinguish between those growing for the fresh market or those growing for the processed market.

Ninety percent of the volume of citrus produced in Florida is sold for processing into juice, which is not regulated under the order. Consequently, while there are an estimated 8,000 citrus growers, it is estimated only 750 growers produce for the fresh market. Because there is no readily available comprehensive list of fresh citrus growers, the Committee could allocate a great deal of resources into information distribution and still not be certain that the information is getting to those covered under the order.

Recently, the Committee began discussing potential changes to the order to make it more efficient and responsive to industry needs. In these discussions, the Committee recognized that grower involvement could be improved through focused communication with fresh market citrus growers. However, in order to actively reach out to growers in the industry, the Committee must have accurate information. The Committee discussed developing a list of growers compiled annually from information provided by handlers to make effective outreach possible. Some members expressed concerns about the disclosure of proprietary information. The Committee addressed these concerns by stating the scope of the information collection could be limited to only grower contact information.

In addition, while this action assists the Committee in its efforts to keep growers informed and to solicit their input on potential changes to the order, it also can be used to increase grower outreach and involvement in Committee elections and membership, facilitate grower participation in amendment and continuance referenda, and provide for a more efficient use of Committee resources.

As a result, Committee members recommended collecting grower names and contact information each season from handlers of fresh citrus so that the Committee will have an accurate and updated list to use in communicating with fresh market citrus growers. June 15 was selected as the due date for this information as it is toward the end of the season and Committee members agreed handlers will have a complete list at that time.

This change revises reporting requirements to require all fresh citrus handlers regulated under the order to provide the Committee with contact information for all growers whose fruit they have shipped. This information is due by June 15 of each season. The change enables the Committee to more efficiently administer the order and communicate fresh market issues to fresh market citrus growers.

Pursuant to requirements set forth in the Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612), the Agricultural Marketing Service (AMS) has considered the economic impact of this action on small entities. Accordingly, AMS has prepared this final 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 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 approximately 8,000 growers of citrus in the production area and approximately 45 handlers subject to regulation under the marketing order. Small agricultural producers are defined by the Small Business Administration (SBA) as those having annual receipts less than $750,000, and small agricultural service firms are defined as those whose annual receipts are less than $7,000,000 (13 CFR 121.201).

Based on production data, grower prices as reported by the National Agricultural Statistics Service, and the total number of Florida citrus growers, the average annual grower revenue is below $750,000. In addition, based on industry and Committee data, the average annual f.o.b. price for fresh Florida citrus during the 2010-11 season was approximately $12.16 per 4/5 bushel carton, and total fresh shipments were approximately 30.4 million cartons. Using the average f.o.b. price and shipment data, about 55 percent of the Florida citrus handlers could be considered small businesses under SBA's definition. Thus, assuming a normal distribution, the majority of producers and handlers of Florida citrus may be classified as small entities.

This rule revises the reporting requirements prescribed under the order. This action requires all fresh citrus handlers to provide the Committee with a list of all growers whose fruit they handled by June 15 of each season. This information will enable the Committee to more efficiently administer the order and better communicate fresh market issues to fresh market citrus growers. This rule creates a new § 905.171, which establishes the new reporting requirement. The authority for this action is provided for in § 905.71. This change was unanimously recommended by the Committee at a July 17, 2012, meeting.

Requiring grower contact information each season imposes a minor increase in the reporting burden on all citrus handlers. However, this data is already recorded and maintained by handlers as a part of their daily business. Handlers, regardless of size, should be able to readily access this information. Consequently, any additional costs associated with this change will be minimal and apply equally to all handlers.

This action will also help growers receive more information about the activities under the order, and make them more aware of their opportunities to participate in the efforts of the Committee. The benefits of this rule are expected to be equally available to all fresh citrus growers, regardless of their size.

The Committee discussed making no change as an alternative to this action, but determined that in order to efficiently carry out the objectives of the marketing order, the information collection within this new report was necessary. Therefore, this alternative was rejected.

In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), this collection has been submitted to the Office of Management and Budget (OMB) with the reference number 0581-0284. Upon approval, the collection will be merged with OMB No. 0581-0189, Generic OMB Fruit Crops. This final rule establishes the use of a new Committee form, which imposes a minor burden increase of 15 hours. The form, Handler Supplier Report, requires minimum information necessary to effectively carry out the requirement of the order. The information would enable the Committee to more efficiently administer the order and improve communication with growers.

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.

As noted in the initial regulatory flexibility analysis, 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.

Further, the Committee's meeting was widely publicized throughout the citrus industry and all interested persons were invited to attend the meeting and participate in Committee deliberations on all issues. Like all Committee meetings, the July 17, 2012, meeting was a public meeting and all entities, both large and small, were able to express views on this issue.

A proposed rule concerning this action was published in the Federal Register on March 5, 2013 (78 FR 14236). Copies of the rule were mailed or sent via facsimile to all Committee members and citrus handlers. Finally, the rule was made available through the Internet by USDA and the Office of the Federal Register. A 60-day comment period ending May 6, 2013, was provided to allow interested persons to respond to the proposal. No comments were received.

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

After consideration of all relevant matter presented, including the information and recommendation submitted by the Committee and other available information, it is hereby found that this rule, as hereinafter set forth, will tend to effectuate the declared policy of the Act.

It is further found that good cause exists for not postponing the effective date of this rule until 30 days after publication in the Federal Register (5 U.S.C. 553) because the Committee requires time to prepare and mail out a handler information packet that should include the Handler Supplier Report, prior to the beginning of shipments for the next crop year that begins August 1. In addition, handlers are aware of this rule that was recommended at a Committee meeting on July 17, 2012. Also, a 60-day comment period was provided in the proposed rule.

For the reasons set forth in the preamble, 7 CFR part 905 is amended as follows:

This final 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 final 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 rule establishes 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 2013-2014 marketing year, which begins on June 1, 2013.

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. Input from spearmint oil handlers and producers regarding prospective marketing conditions is considered as well. 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, with 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 17, 2012, and recommended salable quantities and allotment percentages for both classes of oil for the 2013-2014 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 1,344,858 pounds and 65 percent, respectively. The two members opposing the action felt that the proposed levels were too high and favored establishing a lower salable quantity and allotment percentage for Scotch spearmint oil. For Native spearmint oil, the Committee, in a vote of six members in favor and two members opposed, recommended the establishment of a salable quantity and allotment percentage of 1,432,189 pounds and 61 percent, respectively. Once again, the two members opposing the action supported volume regulation but favored an undetermined lower salable quantity and allotment percentage for Native spearmint oil than what was proposed.

This final rule limits the amount of spearmint oil that handlers may purchase from, or handle on behalf of, producers during the 2013-2014 marketing year, which begins on June 1, 2013. 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 as high as 72 percent in 1988, and as low as 27 percent in 2002. More recently, sales of Far West Scotch spearmint oil have been approximately 50 percent of world sales, and are expected to hold steady, or increase slightly, in upcoming years. In addition, imports of foreign produced spearmint oil into the U.S. have recently been trending down, while exports of domestic spearmint oil have been trending up. As a result, competition in the domestic market from foreign produced spearmint oil has decreased and the demand for Far West spearmint oil, both domestically and abroad, has been very strong.

The Scotch spearmint industry is emerging from the difficult market environment that has existed in the past few years. Many of the negative market components that were present in the spearmint oil industry from 2008 through 2011 have corrected. During that period, increased production and weakened market demand for Scotch spearmint oil combined to create large stocks of excess oil held in reserve. However, most recently, production of Scotch spearmint oil has moderated, trade demand for Scotch spearmint oil has increased, and excess inventory levels have dropped dramatically. In fact, production of Scotch spearmint oil will need to increase during the 2013 season to meet the anticipated market demand.

Although the spearmint oil industry continues to have some concerns over the strength of the U.S. economy, marketing conditions for Scotch spearmint oil have improved significantly. Lower inventories, steady to increasing production, and strong projected demand are all positive indicators of improving marketing conditions for Scotch spearmint oil. Inventories, production, and market demand are now at levels that are considered healthy for the industry.

Certain factors may be contributing to the recent increase in demand for Far West Scotch spearmint oil. First, although China and India have been significant suppliers of spearmint oil for the past 15 years, they have started to replace some spearmint acreage with other mint varieties, such as Mentha arvensis (wild mint), and other non-mint competing crops. In addition, both countries are utilizing more of their domestically produced spearmint oil, removing oil that might otherwise have been exported. Also, the Midwest region of the U.S. is experiencing a significant reduction in Scotch spearmint oil production. This decrease in regional production is partly due to unexpected disease and weather related factors and partly the result of competition from other alternate crops, such as corn and soybeans, which are currently experiencing higher than average returns. Lastly, improving global economic conditions have led to increased consumption of spearmint flavored products.

The Committee estimates that the carry-in of Scotch spearmint oil on June 1, 2013, the primary measure of excess supply, will be approximately 16,570 pounds. This amount is down from the previous year's estimate of 149,740 pounds and is lower than the minimum carry-in quantity that the Committee considers to be favorable.

Production of Scotch spearmint oil has decreased in recent years in response to high Scotch spearmint oil inventory levels and below average market demand. Production dropped from a high of 1,050,700 pounds in 2009 to an estimated 621,480 pounds in 2012. Total industry production of Scotch spearmint oil is now below the level that the Committee views as optimum. The Committee expects production will increase during the 2013 season in response to the strong market demand currently observed in the industry and the low inventory levels of Scotch spearmint oil available to the market. The Committee considers the current trends in supply and demand to be favorable, as it marks an end to the oversupply situation in Scotch spearmint oil and the beginning of a period where supply and demand are in harmony.

Handlers indicate that increasing consumer demand for mint flavored products provide a positive expectation for long-term increases in the demand for Far West Scotch spearmint oil. Spearmint oil handlers have indicated that demand for Scotch spearmint oil has been gaining strength. Handlers who had projected the 2012-2013 trade demand for Far West Scotch Spearmint oil to be in the range of 825,000 pounds to 1,100,000 pounds now expect it to increase to between 900,000 pounds to 1,200,000 pounds during the 2013-2014 marketing year.

Given the improving economic indicators for the Far West Scotch spearmint oil industry outlined above, the Committee took a positive perspective into the discussion of establishing appropriate salable quantities and allotment percentages for the upcoming season. At the October 17, 2012, meeting, the Committee recommended the 2013-2014 Scotch spearmint oil salable quantity of 1,344,858 pounds and an allotment percentage of 65 percent. The Committee utilized sales estimates for 2013-2014 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 these recommendations. The volume control levels recommended by the Committee represent an increase of 566,418 pounds and 27 percentage points over the previous year's initial salable quantity and allotment percentage, reflecting a much more positive assessment of the industry's current economic conditions.

The Committee estimates that about 1,200,000 pounds of Scotch spearmint oil may be sold during the 2013-2014 marketing year. When considered in conjunction with the estimated carry-in of 16,570 pounds of Scotch spearmint oil on June 1, 2013, the recommended salable quantity of 1,344,858 pounds results in a total available supply of approximately 1,361,428 pounds of Scotch spearmint oil during the 2013-2014 marketing year. The Committee estimates that carry-in of Scotch spearmint oil into the 2014-2015 marketing year, which begins June 1, 2014, will be 161,428 pounds, an increase of 144,858 pounds from the beginning of the 2013-2014 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 of Scotch spearmint oil salable quantity and allotment percentage for the 2013-2014 marketing year based on the information discussed above, as well as the data outlined below.

(A) Estimated carry-in of Scotch spearmint oil on June 1, 2013—16,570 pounds. This figure is the difference between the revised 2012-2013 marketing year total available supply of 986,570 pounds and the estimated 2012-2013 marketing year trade demand of 970,000 pounds.

(B) Estimated trade demand of Scotch spearmint oil for the 2013-2014 marketing year—1,200,000 pounds. This figure is based on input from producers at five Scotch spearmint oil production area meetings held in late September and early October 2012, as well as estimates provided by handlers and other meeting participants at the October 17, 2012, meeting. The average estimated trade demand provided at the five production area meetings is 1,120,000 pounds, which is 35,000 pounds less than the average of trade demand estimates submitted by handlers. The average of Far West Scotch spearmint oil sales over the last five years is 772,543 pounds.

(C) Salable quantity of Scotch spearmint oil required from the 2013-2014 marketing year production—1,183,430 pounds. This figure is the difference between the estimated 2013-2014 marketing year trade demand (1,200,000 pounds) and the estimated carry-in on June 1, 2013 (16,570 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 of Scotch spearmint oil for the 2013-2014 marketing year—2,069,012 pounds. This figure represents a one percent increase over the revised 2012-2013 total allotment base. This figure is generally revised each year on June 1 due to producer base being lost as a result of the bona fide effort production provisions of § 985.53(e). The revision is usually minimal.

(E) Computed Scotch spearmint oil 2013-2014 marketing year allotment percentage—57.2 percent. This percentage is computed by dividing the minimum required salable quantity (1,183,430 pounds) by the total estimated allotment base (2,069,012 pounds).

(F) Recommended Scotch spearmint oil 2013-2014 marketing year allotment percentage—65 percent. This is the Committee's recommendation and is based on the computed allotment percentage (57.2 percent), the average of the computed allotment percentage figures from the five production area meetings (55.8 percent), and input from producers and handlers at the October 17, 2012, meeting. The recommended allotment percentage of 65 percent is also based on the Committee's determination that the computed percentage (57.2 percent) may not adequately supply the potential 2013-2014 Scotch spearmint oil market.

(G) Recommended Scotch spearmint oil 2013-2014 marketing year salable quantity—1,344,858 pounds. This figure is the product of the recommended allotment percentage (65 percent) and the total estimated allotment base (2,069,012 pounds).

(H) Estimated total available supply of Scotch spearmint oil for the 2013-2014 marketing year—1,361,428 pounds. This figure is the sum of the 2013-2014 recommended salable quantity (1,344,858 pounds) and the estimated carry-in on June 1, 2013 (16,570 pounds).

The Native spearmint oil industry is experiencing market conditions similar to those observed in the Scotch spearmint oil market. Approximately 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 has been producing 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 declined to only 48 percent. Since then, the percentage has been increasing again and Far West Native spearmint oil is estimated to be over 70 percent of global sales in 2012.

Despite the fact that Far West Native spearmint oil has been gaining world market share, the industry has endured challenging marketing conditions over the past five years. Overproduction, coupled with a decrease in demand during the global economic recession, created an excess inventory situation for Native spearmint oil that negatively impacted the industry. However, most recently, production of Native spearmint oil has moderated, trade demand for Native spearmint oil has increased, and excess inventory levels have dropped to levels considered optimal by the Committee.

When the Committee met on October 17, 2012, to consider volume regulations for the upcoming 2013-2014 marketing year, the general consensus within the Native spearmint oil industry was that marketing conditions had improved over recent years and are expected to keep improving into the future. The production of Far West Native spearmint oil, which declined from a high of 1,453,896 pounds in 2009 to approximately 1,210,260 pounds in 2012, is anticipated to remain steady during the 2013 season. The Committee further expects that production will be more in line with the projected demand of Native spearmint oil in upcoming years.

Excess Native spearmint oil inventory, as measured by oil held in reserve by producers and reported by the Committee, is estimated to be 379,006 pounds at the end of the 2012-2013 marketing year, down from a recent high of 606,942 pounds in 2011. Reserve Native spearmint oil is approaching the level that the Committee believes is optimum for the industry.

In addition to an improved supply situation, demand for Far West Native spearmint oil has been improving. Spearmint oil handlers, who previously projected the 2012-2013 trade demand for Far West Native spearmint oil in the range of 1,275,000 pounds to 1,450,000 pounds, with an average of 1,350,000 pounds, have projected trade demand for the 2013-2014 marketing period to be in the range of 1,200,000 pounds to 1,500,000 pounds, with an average of 1,400,000.

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

As such, at the October 17, 2012, meeting, the Committee recommended a 2013-2014 Native spearmint oil salable quantity of 1,432,189 pounds and an allotment percentage of 61 percent. The Committee utilized Native spearmint oil sales estimates for 2013-2014, as provided by several of the industry's handlers, as well as historical and current Native spearmint oil market statistics to establish these thresholds. These volume control levels represent an increase of 268,887 pounds and 11 percentage points over the previous year's initial salable quantity and allotment percentage. Should these levels prove insufficient to adequately supply the market, the Committee has the authority to recommend an intra-seasonal increase, as it has done in the past two marketing periods, if demand rises beyond expectations.

The Committee estimates that approximately 1,425,000 pounds of Native spearmint oil may be sold during the 2013-2014 marketing year. When considered in conjunction with the estimated carry-in of 43,411 pounds of Native spearmint oil on June 1, 2013, the recommended salable quantity of 1,432,189 pounds results in an estimated total available supply of 1,475,600 pounds of Native spearmint oil during the 2013-2014 marketing year. The Committee also estimates that carry-in of Native spearmint oil at the beginning of the 2014-2015 marketing year will be approximately 50,600 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 of Native spearmint oil salable quantity and allotment percentage for the 2013-2014 marketing year based on the information discussed above, as well as the data outlined below.

(A) Estimated carry-in of Native spearmint oil on June 1, 2013—43,411 pounds. This figure is the difference between the revised 2012-2013 marketing year total available supply of 1,418,411 pounds and the estimated 2012-2013 marketing year trade demand of 1,375,000 pounds.

(B) Estimated trade demand of Native spearmint oil for the 2013-2014 marketing year—1,425,000 pounds. This estimate is established by the Committee and is based on input from producers at the six Native spearmint oil production area meetings held in late September and early October 2012, as well as estimates provided by handlers and other meeting participants at the October 17, 2012, meeting. The average estimated trade demand provided at the six production area meetings was 1,354,167 pounds, whereas the handler estimate ranged from 1,200,000 pounds to 1,500,000 pounds, and averaged 1,400,000 pounds. The average of Far West Native spearmint oil sales over the last five years is 1,158,520 pounds.

(C) Salable quantity of Native spearmint oil required from the 2013-2014 marketing year production—1,381,589 pounds. This figure is the difference between the estimated 2013-2014 marketing year trade demand (1,425,000 pounds) and the estimated carry-in on June 1, 2013 (43,411 pounds). This is the minimum amount that the Committee believes is required to meet the anticipated 2013-2014 Native spearmint oil trade demand.

(D) Total estimated allotment base of Native spearmint oil for the 2013-2014 marketing year—2,347,850 pounds. This figure represents a one percent increase over the revised 2012-2013 total allotment base. This figure is generally revised each year on June 1 due to producer base being lost as a result of the bona fide effort production provisions of § 985.53(e). The revision is usually minimal.

(E) Computed Native spearmint oil 2013-2014 marketing year allotment percentage—58.8 percent. This percentage is computed by dividing the required salable quantity (1,381,589 pounds) by the total estimated allotment base (2,347,850 pounds).

(F) Recommended Native spearmint oil 2013-2014 marketing year allotment percentage—61 percent. This is the Committee's recommendation based on the computed allotment percentage (58.8 percent), the average of the computed allotment percentage figures from the six production area meetings (56.5 percent), and input from producers and handlers at the October 17, 2012, meeting. The recommended allotment percentage of 61 percent is also based on the Committee's determination that the computed percentage (58.8 percent) may not adequately supply the potential 2013-2014 Native spearmint oil market.

(G) Recommended Native spearmint oil 2013-2014 marketing year salable quantity—1,432,189 pounds. This figure is the product of the recommended allotment percentage (61 percent) and the total estimated allotment base (2,347,850 pounds).

(H) Estimated available supply of Native spearmint oil for the 2013-2014 marketing year—1,475,600 pounds. This figure is the sum of the 2013-2014 recommended salable quantity (1,432,189 pounds) and the estimated carry-in on June 1, 2013 (43,411 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 1,344,858 pounds and 65 percent, and 1,432,189 pounds and 61 percent, respectively, are based on the goal of establishing and maintaining market stability. The Committee anticipates that this goal will 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 salable quantities are not expected to cause a shortage of spearmint oil supplies. Any unanticipated or additional market demand for spearmint oil which may develop during the marketing year could be satisfied by an intra-seasonal increase in the salable quantity. The order makes the provision for intra-seasonal increases 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 2013-2014 marketing year may transfer such excess spearmint oil to producers who have produced less than their annual allotment, or, up until November 1, 2013, place it into the reserve pool to be released in the future in accordance with market needs.

This regulation is similar to regulations issued in prior seasons. The average allotment percentage for the five most recent marketing years for Scotch spearmint oil is 38.8 percent, while the average allotment percentage for the same five-year period for Native spearmint oil is 52.2 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 final rule, USDA has reviewed the Committee's marketing policy statement for the 2013-2014 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 2013-2014 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 USDA's “Guidelines for Fruit, Vegetable, and Specialty Crop Marketing Orders” has also been reviewed and confirmed.

The salable quantities and allotment percentages established by this final rule allow the anticipated market needs to be fulfilled. In determining anticipated market needs, the Committee considered 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 2013-2014 season in order to meet anticipated market demand.

Pursuant to requirements set forth in the Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612), the Agricultural Marketing Service (AMS) has considered the economic impact of this action on small entities. Accordingly, AMS has prepared this final 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 36 producers of Scotch spearmint oil and approximately 91 producers of Native spearmint oil in the 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 two of the eight 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 36 Scotch spearmint oil producers and 29 of the 91 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 purposes of 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 income from 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 small producers 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 final rule establishes 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 2013-2014 marketing year. The Committee recommended this action 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 that may 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. Notwithstanding the recent global recession and the overall negative impact on demand for consumer goods that utilize spearmint oil, demand for spearmint oil tends to change slowly from year to year.

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 spearmint 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 grower prices for the period 1980-2011 (when the marketing order was in effect) is 0.19 compared to 0.34 for the decade prior to the promulgation of the order (1970-79) and 0.48 for the prior 20-year period (1960-79). 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 32-year average (1.897 million pounds from 1980 through 2011) and the largest crop was approximately 162 percent of the 32-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 were even more pronounced before the creation of the order, can create liquidity problems for some producers. The 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 carryover 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. This could result 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 trade demand for the 2013-2014 marketing year for both classes of oil at 2,625,000 pounds, and that the expected combined salable carry-in on June 1, 2013, will be 59,981 pounds. This results in a combined required salable quantity of 2,565,019 pounds. With volume control, sales by producers for the 2013-2014 marketing year would be limited to 2,777,047 pounds (the salable quantity for both classes of spearmint oil).

The allotment percentages, upon which 2013-2014 producer allotments are based, are 65 percent for Scotch and 61 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 $1.35 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 2013-2014 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 may occur without volume control.

After computing the initial 57.2 percent Scotch spearmint oil allotment percentage, the Committee considered various alternative levels of volume control for Scotch spearmint oil. Given the moderately improving marketing conditions, there was consensus that the Scotch spearmint oil allotment percentage for 2013-2014 should be more than the percentage established for the 2012-2013 marketing year (38 percent). After considerable discussion, the eight-member committee, on a vote of six members in favor and two members opposed, determined that 1,344,858 pounds and 65 percent would be the most effective Scotch spearmint oil salable quantity and allotment percentage, respectively, for the 2013-2014 marketing year. The two dissenting members felt that the salable quantity and allotment percentage should be set at an unidentified lower 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 58.8 percent, the Committee, in a vote of six members in favor and two members opposed, recommended 1,432,189 pounds and 61 percent for the effective Native spearmint oil salable quantity and allotment percentage, respectively, for the 2013-2014 marketing year. The two dissenting members felt that the salable quantity and allotment percentage should be set at an unidentified lower level.

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 determined that the salable quantity and allotment percentage levels recommended will achieve the objectives sought.

Without any regulations in effect, the Committee believes the industry could return to the pronounced cyclical price patterns that occurred prior to the order, and that prices in 2013-2014 could decline substantially below current levels.

According to the Committee, the established 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.

In accordance with the Paperwork Reduction Act of 1995, (44 U.S.C. Chapter 35), the order's information collection requirements have been previously approved by the Office of Management and Budget (OMB) and assigned OMB No. 0581-0178, Generic Vegetable and Specialty Crops. No changes in those requirements as a result of this action are necessary. Should any changes become necessary, they would be submitted to OMB for approval.

This final rule establishes the salable quantities and allotment percentages of Class 1 (Scotch) spearmint oil and Class 3 (Native) spearmint oil produced in the Far West during the 2013-2014 marketing year. Accordingly, this final rule will 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 final 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 17, 2012, meeting was a public meeting and all entities, both large and small, were able to express views on this issue.

A proposed rule concerning this action was published in the Federal Register on April 15, 2013 (78 FR 22202). A copy of the rule was provided to Committee staff, who in turn made it available to all Far West spearmint oil producers, handlers, and interested persons. Finally, the rule was made available through the Internet by USDA and the Office of the Federal Register. A 15-day comment period ending April 30, 2013, was provided to allow interested persons to respond to the proposal. No comments were received.

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

After consideration of all relevant matter presented, including the information and recommendation submitted by the Committee and other available information, it is hereby found that this rule, as hereinafter set forth, will tend to effectuate the declared policy of the Act.

It is further found that good cause exists for not postponing the effective date of this rule until 30 days after publication in the Federal Register (5 U.S.C. 553) because the 2013-2014 marketing year starts on June 1, 2013, and handlers will need to begin purchasing the spearmint oil allotted under this rulemaking. Further, handlers are aware of this rule, which was recommended at a public meeting. Finally, a 15-day comment period was provided for in the proposed rule.

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

On March 18, 2013 (78 FR 16601), the NRC published in the Federal Register a direct final rule amending its regulations in part 72 of Title 10 of the Code of Federal Regulations (10 CFR) to include Amendment No. 3 to CoC No. 1031, MAGNASTOR® System listing within the “List of Approved Spent Fuel Storage Casks.” The direct final rule was to become effective on June 3, 2013. The NRC also concurrently published a companion proposed rule on March 18, 2013 (78 FR 16619).

In the March 18, 2013, proposed rule, the NRC stated that if any significant adverse comments were received, a document that withdraws the direct final rule would be published in the Federal Register. As a result, the direct final rule would not take effect.

The NRC received a significant adverse comment on the proposed rule that accompanied the direct final rule; therefore, the NRC is withdrawing the direct final rule. The comment was submitted by NAC International on April 17, 2013 (available at www.regulations.gov by searching on Docket ID NRC-2012-0308). NAC International's comment identified several corrections to the information used by the NRC to develop the proposed Technical Specifications. Specifically, the comment identified revisions to Table B2-4, Bounding PWR [Pressurized Water Reactor] Fuel Assembly Loading Criteria—Enrichment/Soluble Boron Limits, in Appendix B, Approved Contents for the MAGNASTOR® System, of the CoC. This table provides bounding pressurized water reactor fuel assembly loading criteria, in terms of enrichment limits. The comment also identified a typographical error in Table B2-4 which must be corrected in a revision to that table. The NRC considers these revisions to be a significant adverse comment as defined in Section I, Procedural Background, of the direct final rule, because these revisions require a change (other than editorial) to the Technical Specifications.

As stated in the March 18, 2013, proposed rule, the NRC will address the comment in a subsequent final rule. The NRC will not initiate a second comment period on this action.

The FAA has determined that the substance of these special conditions has been subject to the public-comment process in several prior instances with no substantive comments received. The FAA therefore finds that good cause exists for making these special conditions effective upon issuance.

We invite interested people to take part in this rulemaking by sending written comments, data, or views. The most helpful comments reference a specific portion of the special conditions, explain the reason for any recommended change, and include supporting data. We ask that you send us two copies of written comments.

We will file in the docket all comments we receive, as well as a report summarizing each substantive public contact with FAA personnel concerning these special conditions. You can inspect the docket before and after the comment closing date. If you wish to review the docket in person, go to the address in the ADDRESSES section of this preamble between 7:30 a.m. and 4:00 p.m., Monday through Friday, except Federal holidays.

We will consider all comments we receive on or before the closing date for comments. We will consider comments filed late if it is possible to do so without incurring expense or delay. We may change these special conditions based on the comments we receive.

If you want us to acknowledge receipt of your comments on this proposal, include with your comments a self-addressed, stamped postcard on which you have written the docket number. We will stamp the date on the postcard and mail it back to you.

Note: The term “enhanced vision system” (EVS) in this document refers to a system comprised of a head-up display, imaging sensor(s), and avionics interfaces that display the sensor imagery on the HUD, and which overlay that imagery with alpha-numeric and symbolic flight information. However, the term has also been commonly used in reference to systems that displayed the sensor imagery, with or without other flight information, on a head-down display. For clarity, the FAA created the term “enhanced flight vision system” (EFVS) to refer to certain EVS systems that meet the requirements of the new operational rules—in particular, the requirement for a HUD and specified flight information—and which can be used to determine “enhanced flight vision.” An EFVS can be considered a subset of a system otherwise labeled EVS.

On October 21, 2010, Gulfstream Aerospace Corporation applied to the FAA, via a G280 STC project, for approval of the installation of an Enhanced Flight Vision System (EFVS) with a head up display (HUD). The EFVS is also capable of displaying forward-looking infrared (FLIR) imagery. The original type certificate for the G280 airplanes is A61NM, revision 3, November 5, 2012.

The Gulfstream Model G280 is a two-crew-member transport business jet with a maximum ramp weight of 39,750 lbs and is certified for up to 19 passengers.

The electronic infrared image displayed between the pilot and the forward windshield represents a novel or unusual design feature in the context of 14 CFR 25.773. Section 25.773 was not written in anticipation of such technology. The electronic image has the potential to enhance the pilot's awareness of the terrain, hazards, and airport features. At the same time, the image may partially obscure the pilot's direct outside compartment view. Therefore, the FAA needs adequate safety standards to evaluate the EFVS to determine that the imagery provides the intended visual enhancements without undue interference with the pilot's outside compartment view. The FAA intent is that the pilot will be able to use a combination of the information seen in the image, and the natural view of the outside scene seen through the image, as safely and effectively as a pilot compartment view without an EVS image, that is compliant with § 25.773.

Although the FAA has determined that the existing regulations are not adequate for certification of EFVSs, it believes that EFVSs could be certified through application of appropriate safety criteria. Therefore, the FAA has determined that special conditions should be issued for certification of EFVS to provide a level of safety equivalent to that provided by the standard in § 25.773.

On January 9, 2004, the FAA published revisions to operational rules in 14 CFR parts 1, 91, 121, 125, and 135 to allow aircraft to operate below certain altitudes during a straight-in instrument approach while using an EFVS to meet visibility requirements.

Prior to this rule change, the FAA issued Special Conditions No. 25-180-SC, which applied to an EVS installed on Gulfstream Model G-V airplanes. Those special conditions addressed the requirements for the pilot compartment view and limited the scope of the intended functions permissible under the operational rules at the time. The intended function of the EVS imagery was to aid the pilot during the approach, and allow the pilot to detect and identify the visual references for the intended runway down to 100 feet above the touchdown zone. However, the EVS imagery alone was not to be used as a means to satisfy visibility requirements below 100 feet.

The 2004 operational rule change expands the permissible application of certain EVSs that are certified to meet the new EFVS standards. This rule will allow the use of an EFVS for operation below the minimum descent altitude or decision height to meet new visibility requirements of § 91.175(l). The purpose of these special conditions is not only to address the issue of the “pilot compartment view,” as was done by Special Conditions No. 25-180-SC, but also to define the scope of intended function consistent with § 91.175(l) and (m).

Under the provisions of 14 CFR 21.101, Gulfstream must show that the Model G280, as modified, complies with the regulations in the U.S. type-certification basis established for those airplanes. The U.S. type-certification basis for the airplanes is established in accordance with § 21.21 and 21.17, and the type certification application date. The U.S. type-certification basis for these airplane models is listed in Type Certificate Data Sheet No. A16NM, revision 3, November 5, 2012, which covers all variants of the Model G280 airplanes.

In addition, the certification basis includes certain special conditions and exemptions that are not relevant to these special conditions. Also, if the regulations incorporated by reference do not provide adequate standards with respect to the change, the applicant must comply with certain regulations in effect on the date of application for the change.

If the Administrator finds that the applicable airworthiness regulations (i.e., part 25 as amended) do not contain adequate or appropriate safety standards for the Gulfstream Model G280 airplanes, modified by the applicant, because of a novel or unusual design feature, special conditions are prescribed under the provisions of § 21.16.

Special conditions are initially applicable to the model for which they are issued. Should the applicant apply for a supplemental type certificate to modify any other model included on the same type certificate, to incorporate the same novel or unusual design feature, the special conditions would also apply to the other model.

Special conditions, as defined in § 11.19, are issued in accordance with § 11.38 and become part of the type-certification basis in accordance with § 21.101.

The G280 airplanes will incorporate an EFVS, which is a novel or unusual design feature. The EFVS is a novel or unusual design feature because it projects a video image derived from a FLIR camera through the HUD. The EFVS image is projected in the center of the “pilot compartment view,” which is governed by § 25.773. The image is displayed with HUD symbology and overlays the forward outside view. Therefore, § 25.773 does not contain appropriate safety standards for the EFVS display.

Operationally, during an instrument approach, the EFVS image is intended to enhance the pilot's ability to detect and identify “visual references for the intended runway” (see § 91.175(l)(3)) to continue the approach below decision height or minimum descent altitude. Depending on atmospheric conditions and the strength of infrared energy emitted and/or reflected from the scene, the pilot can see these visual references in the image better than he or she can see them through the window without EFVS.

Scene contrast detected by infrared sensors can be much different from that detected by natural pilot vision. On a dark night, thermal differences of objects which are not detectable by the naked eye are easily detected by many imaging infrared systems. On the other hand, contrasting colors in visual wavelengths may be distinguished by the naked eye but not by an imaging infrared system. Where thermal contrast in the scene is sufficiently detectable, the pilot can recognize shapes and patterns of certain visual references in the infrared image. However, depending on conditions, those shapes and patterns in the infrared image can appear significantly different than they would with normal vision. Considering these factors, the EFVS image needs to be evaluated to determine that it can be accurately interpreted by the pilot.

The EFVS image may improve the pilot's ability to detect and identify items of interest. However, the EFVS needs to be evaluated to determine that the imagery allows the pilot to perform the normal flight-crew duties and adequately see outside the window through the image, consistent with the safety intent of § 25.773(a)(2).

Compared to a HUD displaying the EFVS image and symbology, a HUD that only displays stroke-written symbols is easier to see through. Stroke symbology illuminates a small fraction of the total display area of the HUD, leaving much of that area free of reflected light that could interfere with the pilot's view out the window through the display. However, unlike stroke symbology, the video image illuminates most of the total display area of the HUD (approximately 30 degrees horizontally and 25 degrees vertically) which is a significant fraction of the pilot compartment view. The pilot cannot see around the larger illuminated portions of the video image, but must see the outside scene through it.

Unlike the pilot's external view, the EFVS image is a monochrome, two-dimensional display. Many, but not all, of the depth cues found in the natural view are also found in the image. The quality of the EFVS image and the level of EFVS infrared-sensor performance could depend significantly on conditions of the atmospheric and external light sources. The pilot needs adequate control of sensor gain and image brightness, which can significantly affect image quality and transparency (i.e., the ability to see the outside view through the image). Certain system characteristics could create distracting and confusing display artifacts. Finally, because this is a sensor-based system intended to provide a conformal perspective corresponding with the outside scene, the system must be able to ensure accurate alignment. Therefore, safety standards are needed for each of the following factors:

• An acceptable degree of image transparency;

• Image alignment;

• Lack of significant distortion; and

• The potential for pilot confusion or misleading information.

Section 25.773, Pilot compartment view, specifies that “Each pilot compartment must be free of glare and reflection that could interfere with the normal duties of the minimum flight crew. . .” In issuing § 25.773, the FAA did not anticipate the development of the EFVS and does not consider that § 25.773 adequately addresses the specific issues related to such a system. Therefore, the FAA has determined that special conditions are needed to address the specific issues particular to the installation and use of an EFVS.

The EFVS is intended to present an enhanced view during the landing approach. This enhanced view would help the pilot see and recognize external visual references, as required by § 91.175(l), and to visually monitor the integrity of the approach, as described in FAA Order 6750.24D (“Instrument Landing System and Ancillary Electronic Component Configuration and Performance Requirements,” dated March 1, 2000).

Based on this approved functionality, users would seek to obtain operational approval to conduct approaches—including approaches to Type I runways—in visibility conditions much lower than those for conventional Category I.

The purpose of these special conditions is to ensure that the EFVS to be installed can perform the following functions:

• Present an enhanced view that aids the pilot during the approach.

• Provide enhanced flight visibility to the pilot that is no less than the visibility prescribed in the standard instrument-approach procedure.

• Display an image that the pilot can use to detect and identify the “visual references for the intended runway” required by 14 CFR 91.175(l)(3), to continue the approach with vertical guidance to 100 feet height above the touchdown-zone elevation.

Depending on the atmospheric conditions and the particular visual references that happen to be distinctly visible and detectable in the EFVS image, these functions would support its use by the pilot to visually monitor the integrity of the approach path.

Compliance with these special conditions does not affect the applicability of any of the requirements of the operating regulations (i.e., 14 CFR parts 91, 121, and 135). Furthermore, use of the EFVS does not change the approach minima prescribed in the standard instrument approach procedure being used; published minima still apply.

The FAA certification of this EFVS is limited as follows:

1. The infrared-based EFVS image will not be certified as a means to satisfy the requirements for descent below 100 feet height above touchdown.

2. The EFVS may be used as a supplemental device to enhance the pilot's situational awareness during any phase of flight or operation in which its safe use has been established.

3. An EFVS image may provide an enhanced image of the scene that may compensate for any reduction in the clear outside view of the visual field framed by the HUD combiner. The pilot must be able to use this combination of information seen in the image and the natural view of the outside scene, seen through the image, as safely and effectively as the pilot would use a pilot compartment view without an EVS image that is compliant with § 25.773. This is the fundamental objective of the special conditions.

The FAA will also apply additional certification criteria, not as special conditions, for compliance with related regulatory requirements, such as §§ 25.1301 and 25.1309. These additional criteria address certain image characteristics, installation, demonstration, and system safety.

Image-characteristics criteria include the following:

• Resolution,

• Luminance,

• Luminance uniformity,

• Low-level luminance,

• Contrast variation,

• Display quality,

• Display dynamics (e.g., jitter, flicker, update rate, and lag), and

• Brightness controls.

Installation criteria address visibility and access to EFVS controls, and integration of EFVS in the cockpit.

The EFVS demonstration criteria address the flight and environmental conditions that need to be covered.

The FAA also intends to apply certification criteria relevant to high-intensity radiated fields (HIRF) and lightning protection.

As discussed above, these special conditions are applicable to Gulfstream Model G280 airplanes. Should Gulfstream apply at a later date for a supplemental type certificate to modify any other model included on Type Certificate No. A16NM to incorporate the same novel or unusual design feature, the special conditions would apply to that model as well.

This action affects only certain novel or unusual design features on Gulfstream Model G280 airplanes. It is not a rule of general applicability and it affects only the applicant who applied to the FAA for approval of these features on the airplane.

The authority citation for these special conditions is as follows:

Accordingly, pursuant to the authority delegated to me by the Administrator, the following special conditions are issued as part of the type-certification basis for Gulfstream Model G280 airplanes modified by Gulfstream Aerospace Corporation.

1. The EFVS imagery on the HUD must not degrade the safety of flight or interfere with the effective use of outside visual references for required pilot tasks during any phase of flight in which it is to be used.

2. To avoid unacceptable interference with the safe and effective use of the pilot-compartment view, the EFVS device must meet the following requirements:

a. EFVS design must minimize unacceptable display characteristics or artifacts (e.g. noise, “burlap” overlay, running water droplets) that obscure the desired image of the scene, impair the pilot's ability to detect and identify visual references, mask flight hazards, distract the pilot, or otherwise degrade task performance or safety.

b. Control of EFVS display brightness must be sufficiently effective, in dynamically changing background (ambient) lighting conditions, to prevent full or partial blooming of the display that would distract the pilot, impair the pilot's ability to detect and identify visual references, mask flight hazards, or otherwise degrade task performance or safety. If automatic control for image brightness is not provided, it must be shown that a single manual setting is satisfactory for the range of lighting conditions encountered during a time-critical, high-workload phase of flight (e.g., low-visibility instrument approach).

c. A readily accessible control must be provided that permits the pilot to immediately deactivate and reactivate display of the EFVS image on demand without removing the pilot's hands from the primary flight controls (yoke or equivalent) or thrust control.

d. The EFVS image on the HUD must not impair the pilot's use of guidance information, or degrade the presentation and pilot awareness of essential flight information displayed on the HUD, such as alerts, airspeed, attitude, altitude and direction, approach guidance, wind shear guidance, TCAS resolution advisories, and unusual-attitude recovery cues.

e. The EFVS image and the HUD symbols, which are spatially referenced to the pitch scale, outside view, and image, must be scaled and aligned (i.e., conformal) to the external scene and, when considered singly or in combination, must not be misleading, cause pilot confusion, or increase workload. Some airplane attitudes or cross-wind conditions may cause certain symbols, such as the zero-pitch line or flight-path vector, to reach field-of-view limits such that they cannot be positioned conformably with the image and external scene. In such cases, these symbols may be displayed, but with an altered appearance which makes the pilot aware that they are no longer displayed conformably (for example, “ghosting”).

f. A HUD system used to display EFVS images must, if previously certified, continue to meet all of the requirements of the original approval.

3. The safety and performance of the pilot tasks associated with the use of the pilot-compartment view must not be degraded by the display of the EFVS image. Pilot tasks that must not be degraded by the EFVS image include:

a. Detection, accurate identification, and maneuvering, as necessary, to avoid traffic, terrain, obstacles, and other hazards of flight.

b. Accurate identification and utilization of visual references required for every task relevant to the phase of flight.

4. Appropriate limitations must be stated in the Operating Limitations section of the Airplane Flight Manual to prohibit the use of the EFVS for functions for which EFVS has not been found to be acceptable.

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Community, has issued AD No. 2013-0097, dated April 24, 2013 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states:

This product has been approved by the aviation authority of another country, and is approved for operation in the United States. Pursuant to our bilateral agreement with this State of Design Authority, they have notified us of the unsafe condition described in the MCAI and service information referenced above. We are issuing this AD because we evaluated all information provided by the State of Design Authority and determined the unsafe condition exists and is likely to exist or develop on other products of the same type design.

An unsafe condition exists that requires the immediate adoption of this AD. The FAA has found that the risk to the flying public justifies waiving notice and comment prior to adoption of this rule because there are no airplanes currently on the U.S. registry and thus, does not have any impact upon the public. Therefore, we find that notice and opportunity for prior public comment are unnecessary and that good cause exists for making this amendment effective in less than 30 days.

This AD is a final rule that involves requirements affecting flight safety, and we did not precede it by notice and opportunity for public comment. We invite you to send any written relevant data, views, or arguments about this AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2013-0456; Directorate Identifier 2013-CE-011-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this AD. We will consider all comments received by the closing date and may amend this AD because of those comments.

We will post all comments we receive, without change, to http://www.regulations.gov, including any personal information you provide. We will also post a report summarizing each substantive verbal contact we receive about this AD.

We estimate that this AD will affect 0 products of U.S. registry. We also estimate that it will take about 1 work-hour per product to comply with the basic requirements of this AD. The average labor rate is $85 per work-hour.

Based on these figures, we estimate the cost of the AD on U.S. operators to be $0, or $0 per product.

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

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

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

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

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

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

(3) Will not affect intrastate aviation in Alaska, and

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

Accordingly, under the authority delegated to me by the Administrator, the FAA amends 14 CFR part 39 as follows:

On February 21, 2013, the FAA published in the Federal Register a notice of proposed rulemaking (NPRM) to modify controlled airspace at Pueblo, CO (78 FR 11996). Interested parties were invited to participate in this rulemaking effort by submitting written comments on the proposal to the FAA. No comments were received.

Class D and Class E airspace designations are published in paragraphs 5000, 6002, 6004 and 6005, respectively, of FAA Order 7400.9W dated August 8, 2012, and effective September 15, 2012, which is incorporated by reference in 14 CFR 71.1. The Class D and Class E airspace designations listed in this document will be published subsequently in that Order.

This action amends Title 14 Code of Federal Regulations (14 CFR) part 71 by modifying Class D airspace, Class E airspace designated as surface area, Class E airspace designated as an extension to Class D surface area, and Class E airspace extending upward from 700 feet above the surface, at Pueblo, CO, to accommodate IFR aircraft using VOR/DME standard instrument approach procedures at the airport. The geographic coordinates of the airport for the Class D and Class E airspace areas are updated to coincide with the FAA's aeronautical database. This action is necessary for the safety and management of IFR operations.

The FAA has determined this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. Therefore, this regulation: (1) Is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that only affects air traffic procedures and air navigation, it is certified this rule, when promulgated, does 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 U.S. Code. Subtitle 1, Section 106 discusses 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 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 modifies controlled airspace at Pueblo Memorial Airport, Pueblo, CO.

The FAA has determined that this action qualifies for categorical exclusion under the National Environmental Policy Act in accordance with FAA Order 1050.1E, “Environmental Impacts: Policies and Procedures,” paragraph 311a. This airspace action is not expected to cause any potentially significant environmental impacts, and no extraordinary circumstances exist that warrant preparation of an environmental assessment.

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

History

On December 21, 2012, the FAA published in the Federal Register a notice of proposed rulemaking (NPRM) to modify controlled airspace at Eureka, NV (77 FR 75594). Interested parties were invited to participate in this rulemaking effort by submitting written comments on the proposal to the FAA. No comments were received. The FAA's Terminal Products Group reassessed the proposal and on March 19, 2013, the FAA published in the Federal Register a supplemental notice of proposed rulemaking (SNPRM) to modify the airspace 1,200 feet above the surface southeast of the Eureka Airport, Eureka, NV (78 FR 16821). Interested parties were invited to participate in this rulemaking effort by submitting written comments on the proposal to the FAA. No comments were received. This action modifies the airspace 1,200 feet above the surface by increasing the airspace area southeast of the Eureka Airport, Eureka, NV, to accommodate aircraft using the RNAV (GPS) standard instrument approach procedures at Eureka Airport.

Class E airspace designations are published in paragraph 6005, of FAA Order 7400.9W dated August 8, 2012, and effective September 15, 2012, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designations listed in this document will be published subsequently in that Order.

This action amends Title 14 Code of Federal Regulations (14 CFR) part 71 by modifying Class E airspace extending upward from 700/1,200 feet above the surface, at Eureka Airport, to accommodate IFR aircraft executing RNAV (GPS) standard instrument approach procedures at the airport. Additional controlled airspace extending upward from 1,200 feet above the surface is established to the northeast to contain the MINES (RNAV) ONE departure, and to the southeast for IFR operations. This action is necessary for the safety and management of IFR operations.

The FAA has determined this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. Therefore, this regulation: (1) Is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that only affects air traffic procedures and air navigation, it is certified this rule, when promulgated, does 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 U.S. Code. Subtitle 1, Section 106 discusses 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 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 modifies controlled airspace at Eureka Airport, Eureka, NV.

The FAA has determined that this action qualifies for categorical exclusion under the National Environmental Policy Act in accordance with FAA Order 1050.1E, “Environmental Impacts: Policies and Procedures,” paragraph 311a. This airspace action is not expected to cause any potentially significant environmental impacts, and no extraordinary circumstances exist that warrant preparation of an environmental assessment.

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

On March 19, 2013, the FAA published in the Federal Register a notice of proposed rulemaking (NPRM) to amend controlled airspace at Tuba City, AZ (78 FR 16823). Interested parties were invited to participate in this rulemaking effort by submitting written comments on the proposal to the FAA. No comments were received.

Class E airspace designations are published in paragraph 6006, of FAA Order 7400.9W dated August 8, 2012, and effective September 15, 2012, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designations listed in this document will be published subsequently in that Order.

This action amends Title 14 Code of Federal Regulations (14 CFR) part 71 by establishing Class E en route domestic airspace extending upward from 1,200 feet above the surface, at the Tuba City VORTAC, Tuba City, AZ. This action aids in containing aircraft while in IFR conditions under control of Denver, Albuquerque and Salt Lake City ARTCCs by vectoring aircraft from en route airspace to terminal areas.

The FAA has determined this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. Therefore, this regulation: (1) Is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that only affects air traffic procedures and air navigation, it is certified this rule, when promulgated, does 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 U.S. Code. Subtitle 1, Section 106 discusses 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 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 establishes controlled airspace at Tuba City, AZ.

The FAA has determined that this action qualifies for categorical exclusion under the National Environmental Policy Act in accordance with FAA Order 1050.1E, “Environmental Impacts: Policies and Procedures,” paragraph 311a. This airspace action is not expected to cause any potentially significant environmental impacts, and no extraordinary circumstances exist that warrant preparation of an environmental assessment.

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

This rule amends Title 14, Code of Federal Regulations, part 97 (14 CFR part 97) by amending the referenced SIAPs. The complete regulatory description of each SIAP is listed on the appropriate FAA Form 8260, as modified by the National Flight Data Center (FDC)/Permanent Notice to Airmen (P-NOTAM), and is incorporated by reference in the amendment under 5 U.S.C. 552(a), 1 CFR part 51, and § 97.20 of Title 14 of the Code of Federal Regulations.

The large number of SIAPs, their complex nature, and the need for a special format make their verbatim publication in the Federal Register expensive and impractical. Further, airmen do not use the regulatory text of the SIAPs, but refer to their graphic depiction on charts printed by publishers of aeronautical materials. Thus, the advantages of incorporation by reference are realized and publication of the complete description of each SIAP contained in FAA form documents is unnecessary. This amendment provides the affected CFR sections and specifies the types of SIAP and the corresponding effective dates. This amendment also identifies the airport and its location, the procedure and the amendment number.

This amendment to 14 CFR part 97 is effective upon publication of each separate SIAP as amended in the transmittal. For safety and timeliness of change considerations, this amendment incorporates only specific changes contained for each SIAP as modified by FDC/P-NOTAMs.

The SIAPs, as modified by FDC P-NOTAM, and contained in this amendment are based on the criteria contained in the U.S. Standard for Terminal Instrument Procedures (TERPS). In developing these changes to SIAPs, the TERPS criteria were applied only to specific conditions existing at the affected airports. All SIAP amendments in this rule have been previously issued by the FAA in a FDC NOTAM as an emergency action of immediate flight safety relating directly to published aeronautical charts. The circumstances which created the need for all these SIAP amendments requires making them effective in less than 30 days.

Because of the close and immediate relationship between these SIAPs and safety in air commerce, I find that notice and public procedure before adopting these SIAPs are impracticable and contrary to the public interest and, where applicable, that good cause exists for making these SIAPs effective in less than 30 days.

The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore—(1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. For the same reason, the FAA certifies that this amendment will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

Accordingly, pursuant to the authority delegated to me, Title 14, Code of Federal Regulations, part 97, 14 CFR part 97, is amended by amending Standard Instrument Approach Procedures, effective at 0901 UTC on the dates specified, as follows:

This rule amends Title 14 of the Code of Federal Regulations, Part 97 (14 CFR part 97), by establishing, amending, suspending, or revoking SIAPS, Takeoff Minimums and/or ODPS. The complete regulators description of each SIAP and its associated Takeoff Minimums or ODP for an identified airport is listed on FAA form documents which are incorporated by reference in this amendment under 5 U.S.C. 552(a), 1 CFR part 51, and 14 CFR part 97.20. The applicable FAA Forms are FAA Forms 8260-3, 8260-4, 8260-5, 8260-15A, and 8260-15B when required by an entry on 8260-15A.

The large number of SIAPs, Takeoff Minimums and ODPs, in addition to their complex nature and the need for a special format make publication in the Federal Register expensive and impractical. Furthermore, airmen do not use the regulatory text of the SIAPs, Takeoff Minimums or ODPs, but instead refer to their depiction on charts printed by publishers of aeronautical materials. The advantages of incorporation by reference are realized and publication of the complete description of each SIAP, Takeoff Minimums and ODP listed on FAA forms is unnecessary. This amendment provides the affected CFR sections and specifies the types of SIAPs and the effective dates of the associated Takeoff Minimums and ODPs. This amendment also identifies the airport and its location, the procedure, and the amendment number.

This amendment to 14 CFR part 97 is effective upon publication of each separate SIAP, Takeoff Minimums and ODP as contained in the transmittal. Some SIAP and Takeoff Minimums and textual ODP amendments may have been issued previously by the FAA in a Flight Data Center (FDC) Notice to Airmen (NOTAM) as an emergency action of immediate flight safety relating directly to published aeronautical charts. The circumstances which created the need for some SIAP and Takeoff Minimums and ODP amendments may require making them effective in less than 30 days. For the remaining SIAPS and Takeoff Minimums and ODPS, an effective date at least 30 days after publication is provided.

Further, the SIAPs and Takeoff Minimums and ODPS contained in this amendment are based on the criteria contained in the U.S. Standard for Terminal Instrument Procedures (TERPS). In developing these SIAPS and Takeoff Minimums and ODPs, the TERPS criteria were applied to the conditions existing or anticipated at the affected airports. Because of the close and immediate relationship between these SIAPs, Takeoff Minimums and ODPs, and safety in air commerce, I find that notice and public procedures before adopting these SIAPS, Takeoff Minimums and ODPs are impracticable and contrary to the public interest and, where applicable, that good cause exists for making some SIAPs effective in less than 30 days.

The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore—(1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26,1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. For the same reason, the FAA certifies that this amendment will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

Accordingly, pursuant to the authority delegated to me, Title 14, Code of Federal Regulations, part 97 (14 CFR part 97) is amended by establishing, amending, suspending, or revoking Standard Instrument Approach Procedures and/or Takeoff Minimums and/or Obstacle Departure Procedures effective at 0902 UTC on the dates specified, as follows:

I. Background

On April 19, 2010, the Agencies published a proposed rule to address concerns associated with the garnishment of certain exempt Federal benefit payments, including Social Security benefits, Supplemental Security Income (SSI) payments, VA benefits, Federal Railroad retirement benefits, Federal Railroad unemployment and sickness benefits, Civil Service Retirement System benefits and Federal Employees Retirement System benefits. See 75 FR 20299. The Agencies received 586 comments on the proposed rule. On February 23, 2011, the Agencies published an interim final rule and request for public comment. See 76 FR 9939. The Agencies received 39 comments on the interim final rule, including comments from individuals, consumer advocacy organizations, legal services organizations, an organization of credit and collection companies, a prepaid card association, and financial institutions and their trade associations. As described in Parts II and III of this SUPPLEMENTARY INFORMATION , this final rule amends certain provisions of the interim final rule to address certain issues raised by commenters.

The interim final rule established procedures that financial institutions must follow when they receive a garnishment order for an account holder. Under the interim final rule, a financial institution that receives a garnishment order must first determine if the United States or a State child support enforcement agency is the plaintiff that obtained the order. If so, the financial institution follows its customary procedures for handling the order. If not, the financial institution must review the account history for the prior two-month period to determine whether, during this “lookback period,” one or more exempt benefit payments were directly deposited to the account. The financial institution may rely on the presence of certain Automated Clearing House (ACH) identifiers to determine whether a payment is an exempt benefit payment for purposes of the rule.

The financial institution must allow the account holder to have access to an amount equal to the lesser of the sum of exempt payments directly deposited to the account during the lookback period or the balance of the account on the date of the account review (the “protected amount”). In addition, the financial institution must notify the account holder that the financial institution has received a garnishment order. The notice must briefly explain what a garnishment is and must also include other information regarding the account holder's rights. There is no requirement to send a notice if the balance in the account is zero or negative on the date of account review. Financial institutions may choose to use a model notice contained in the rule in order to be deemed to be in compliance with the notice content requirements.

For an account containing a protected amount, the financial institution may not collect a garnishment fee from the protected amount. The financial institution may only charge a garnishment fee against funds in the account in excess of the protected amount and may not charge or collect a garnishment fee after the date of account review. Financial institutions that comply with the rule's requirements are protected from liability.

Some commenters urged that the Agencies move expeditiously to cover in the rule all Federal payments protected from garnishment by statute, including military retirement payments. One commenter proposed that the rule be expanded to protect certain non-Federal payments deposited to bank accounts—specifically, payments originating from Employment Retirement Income Security Act (ERISA) retirement plan distributions. Other commenters suggested that the Agencies contact the U.S. Senate and propose legislation to make all Federal benefit payments exempt from garnishment. In contrast, a financial institution commenter argued that Federal benefit payments should not be protected from garnishment. One consumer organization recommended that the rule be revised to cover benefit payments made by check as well as payments made by direct deposit.

An organization representing credit and collection companies requested that the final rule provide a procedure under which the creditor garnishing an account be granted access to the debtor's account information, including, but not limited to, the amount held in the garnished account, documentation supporting the financial institution's application of the final rule, and any calculations supporting the financial institution's decision to not freeze certain funds. The association expressed concern that without any transparency into the deliberative process that a financial institution uses to decide which funds are protected by law, an environment could be created in which financial institutions would refuse to freeze funds in the garnished accounts without clear explanation or verified justification.

As discussed in the preamble to the interim final rule, the Agencies have structured the rule to create a framework in which payments protected by statute from garnishment can be included in the future. Federal agencies that issue such payments can, through a public notice-and-comment rulemaking process, amend their regulations to provide that their exempt payments are covered by this rule. The Agencies would then issue a rulemaking to include those payments within the scope of the rule. The Agencies do not have authority to expand the rule to include non-Federal payments, nor do the Agencies believe it is appropriate to seek a legislative change to address Federal payments that they do not issue and over which they do not have regulatory jurisdiction. For the reasons discussed when promulgating the interim final rule, the Agencies do not believe it is feasible or necessary to address checks within the final rule. See 76 FR 9939, 9941.

The Agencies are not adopting the suggestion that creditors be granted access to debtors' account information. Account information is protected under various State and Federal privacy laws. Creditors who believe that a legal basis exists to permit disclosure of a debtor's account information should seek access to that information in accordance with such laws.

The interim final rule defined an account to mean “an account, including a master account or sub account, at a financial institution and to which an electronic payment may be directly routed.” The Agencies received various requests asking for clarification of this definition. One commenter requested that the Agencies clarify that a “master” account, under which multiple sub accounts may be established and held, does not require an aggregate account review as a separate and distinct “account” for purposes of the rule. Credit unions in particular requested clarification on whether a “whole share account,” as opposed to various sub accounts, is subject to the account review and lookback.

Some credit unions commented that credit unions typically assign an individual member (or “primary”) number to each member. The member may then open multiple accounts “under” or “within” this member number with each account being designated by different “sub accounts” or “suffixes.” The member number does not denote an account per se, but rather serves as a “prefix” for all individual sub accounts of the member to or from which deposits and withdrawals may be made. For example, a new member might be given member number 9876. When the member opens a savings (or a share) account, that individual savings account might be noted as sub account “S” or “01.” Similarly, if the same member establishes a checking (or share draft) account, that individual checking account might be noted as sub account “C” or “02.” Both are sub accounts of the member's “membership” account 9876.

The requirement to perform an account review applies to the deposit account to which a Federal payment is routed and credited. In cases where a payment recipient is assigned a member number that doesn't represent an account per se, but that serves as a “prefix” for individual sub accounts, it is the individual sub account (and not the “master account”) that is subject to the account review and lookback.

Immediately following publication of the interim final rule, some financial institutions requested clarification on the definition of “benefit payment” for purposes of identifying Federal benefit payments. The interim final rule defines a benefit payment as a Federal benefit payment “with the character `XX' encoded in positions 54 and 55 of the Company Entry Description field of the Batch Header Record of the direct deposit entry.” The Agencies were asked whether financial institutions may rely solely on the presence of the “XX,” without regard to whether there is a “2” in the “Originator Status Code” field of the Batch Header Record for the payment. Financial institutions pointed out that it is possible that payments other than Federal payments could contain an “XX” encoded in positions 54 or 55.

Following the inquiry, the Agencies published guidance stating that financial institutions must verify that a payment containing an “XX” encoded in positions 54 or 55 is in fact a Federal benefit payment, which they may do by checking for a “2” in the “Originator Status Code” field of the Batch Header Record (Position 79) or by reviewing the description of the payment in the ACH Batch Header Record Company Entry Description to ensure that the payment is one of the exempt Federal benefit types listed in the guidance. 1 The Agencies are codifying this guidance by amending the definition of benefit payment in the final rule to provide that both the “XX” and the “2” be present in the appropriate locations of the Batch Header Record.

The Agencies received many requests for clarification on the definition of “garnishment order” and some commenters indicated that confusion regarding the definition is resulting in compliance difficulties. Consumer advocacy groups, financial institutions, and banking associations recommend that the Agencies revise the definition of “garnishment order” so that it is clear exactly what kinds of documents are considered garnishment orders. The interim final rule includes a broad definition of “garnishment,” which closely tracks the definition in the Agencies' statutes. However, the rule's requirements are triggered only by the receipt of a “garnishment order,” which was defined more narrowly in the interim final rule as “a writ, order, notice, summons, judgment, or similar written instruction issued by a court or a State child support enforcement agency . . .” (emphasis supplied). Under this wording, levies issued directly by a State agency such as a State revenue department would not be subject to the rule.

The Agencies received many comments stating that levies are frequently issued directly by State agencies or municipalities to seize funds in bank accounts. Consumer advocacy groups expressed concern that the narrow definition of “garnishment order” leaves benefit payments exposed to improper garnishment and freezing. Some financial institutions commented that while they do not have a position on whether tax levies issued directly by a State agency should be included within the scope of the rule, guidance on the process of determining what sorts of orders or levies are within the scope of the rule would be helpful. One commenter suggested that the Agencies consider providing an exhaustive list and additional guidance as to exactly which garnishment orders are within the rule's scope.

Some commenters questioned whether the definition of garnishment order in the interim final rule applies to restraining orders, i.e., orders issued pursuant to judgments which restrain an account's funds pending future legal action. Several commenters asked if orders issued by an attorney acting in his or her capacity as an officer of the court are considered to be issued by a court. For example, in the State of New York, garnishment orders (commonly referred to as levies and restraints) can be issued not only by courts, but also by attorneys acting on behalf of judgment creditors. 2 One commenter asked if the rule applied to seizures in criminal actions. This commenter noted that the proposed rule had defined “garnishment” as “execution, levy, attachment, garnishment, or other legal process to enforce a money judgment” (emphasis supplied), but that the phrase “to enforce a money judgment” was removed from the definition of “garnishment” in the interim final rule. The commenter questioned whether by removing the phrase, the Agencies intended that the rule cover not only civil money judgments, but also seizures in criminal actions.

The Agencies are revising the definition of garnishment order to include orders or levies issued by a State or State agency or municipality. To remove any doubt as to whether the rule applies to restraining orders, the Agencies are amending the definition of garnishment order to include “an order to freeze the assets in an account.” With regard to the question of whether a “garnishment order” includes an order issued by the clerk of the court or an attorney acting in his or her capacity as an officer of the court, it was not the Agencies' intention that an order “issued by a court” be so narrowly construed as to exclude such orders. The Agencies' view is an order issued by the clerk of the court or an attorney acting in his or her capacity as an officer of the court in accordance with State law constitutes an order issued by the court. Lastly, the Agencies did intend by removing the phrase “to enforce a money judgment” from the definition of “garnishment” in the interim final rule to ensure that the rule is not limited to civil money judgments.

One commenter urged that the lookback period be extended from 2 months to 65 days, while another commenter urged that it be shortened from 2 months to 30 days. For the reasons discussed in promulgating the interim final rule, the Agencies believe that a 2 month lookback period is appropriate. See 76 FR 9939, 9942.

Several financial institutions requested guidance on how the account balance should be computed when conducting an account review and establishing a protected amount. The interim final rule defined the “protected amount” as the lesser of: (i) The sum of all benefit payments posted to an account between the close of business on the beginning date of the lookback period and the open of business on the ending date of the lookback period and (ii) the balance in an account at the open of business on the date of the account review. Some financial institutions commented that it was not clear whether the account balance for purposes of clause (ii) refers to the ledger balance, the memo ledger balance, the Regulation CC  3 available funds balance or the memo available funds balance. Other commenters noted that the procedure for calculating the protected amount does not take into account intraday postings of credits or debits. Therefore, depending on the time of day that an account review is performed and whether items have been posted to the account during the day, establishing a protected amount without taking into account intraday debits could result in the establishment of a protected amount that exceeds the funds in the account. For example, if $1,000 in protected funds were deposited during the lookback period, and the account balance was $600 at the open of business on the date of the account review, then the protected amount would be $600. If, however, the account review is performed in the afternoon, and all $600 had been withdrawn by the time the account review was performed, then the financial institution would be in the position of establishing and providing access to a $600 protected amount for an account containing no funds.

To address this incongruity, the Agencies are amending the rule to provide that the relevant account balance is the account balance when the account review is performed, so that the balance will include intraday items such as ATM or cash withdrawals. Financial institutions should not use the Regulation CC available funds balance, but should be aware that the requirement to provide access to the protected amount is subject to the usual restrictions on funds availability under Regulation CC, as discussed in the preamble to the interim final rule. 4 In addition, the Agencies do not intend that any line of credit associated with the account be considered as part of the “account balance” for this purpose.

One commenter questioned the calculation of the account balance in the context of accounts in which the concept of a “ledger balance” may be inappropriate. For instance, some accounts hold securities, alternative instruments, real estate, and other assets. For those accounts, the commenter suggested that the Agencies clarify that the account balance is the available market value of the account, which would be the opening balance on the day of account review minus intraday activity. The Agencies are not making this change because the rule applies only to deposit accounts held by a bank, savings association, credit union, or other entity chartered under Federal or State law to engage in the business of banking. 5 The rule does not apply to asset accounts or address any protection that may exist for securities or other assets purchased with Federal benefit payments.

The Agencies received comments noting that although the interim final rule establishes procedures that financial institutions must follow when served with a garnishment order, there will be situations where a financial institution determines that it will not act on a garnishment order. Commenters asked whether the rule's procedures must still be followed in these situations. One example provided by a commenter is when an account holder has more than one account and the first account review reveals (a) no protected amount and (b) sufficient funds to satisfy the judgment. In such situations, the financial institution's obligation to garnish ends when the bank tenders over an amount to pay the debt. By logical extension, the commenter argued, the financial institution's obligation to review the other account(s) in the account holder's name also should end. However, the commenter pointed out that a literal reading of § 212.5(f) (which requires a separate account review for each account in the name of an account holder against whom a garnishment order has been issued) arguably requires reviews of the other account(s) even when there is no remaining debt. A review of a second or third account could then lead to the presence of another “protected amount” (even though the garnishment has been satisfied) and thereby trigger the requirement to send another notice.

Another example cited by a commenter postulated a situation in which a financial institution receives a garnishment order directed against the beneficiary of a “pay on death” or “revocable trust” account. In this situation, the beneficiary has only a contingent interest in the account, the beneficiary's name is not likely to be included on the account and the financial institution would not normally take action against the account based on the beneficiary's contingent interest. A third example, provided by a financial institution trade group, would occur if a financial institution determines that a garnishment order cannot be given effect under State law because all of the funds in the account are protected from garnishment under State law (for example, where State law establishes a dollar amount that is protected).

The Agencies agree that it serves no useful purpose to follow the rule's procedures in situations where a financial institution has made a determination not to take any action affecting an account as the result of the receipt of a garnishment order. The first step required under the rule when a financial institution receives a garnishment order is to examine the order to determine if a Notice of Right to Garnish Federal Benefits is attached or included. The requirement to perform this first step, however, is prefaced by the words, “Prior to taking any other action related to a garnishment order issued against a debtor . . .” See § 212.4(a). Accordingly, if a financial institution has determined not to take action related to a garnishment order, neither this step nor any subsequent requirement of the rule is triggered. The Agencies have published a set of frequently asked questions (FAQs) on the garnishment rule that states that if a financial institution will not be freezing or removing funds from an account in response to a garnishment order, then the financial institution should not perform an account review to determine if a protected amount should be established. 6 In light of this guidance and the wording of § 212.4(a), the Agencies do not believe it is necessary to revise the rule itself on this point.

One consumer advocacy organization opposed permitting any garnishment of exempt funds by the United States or a State Child Support Enforcement Agency. This commenter argued that an agency that is statutorily permitted to seize exempt Federal benefits should proceed through the Federal benefit offset program because the bank garnishment process is not well suited for such collections and should not be permitted. Several consumer advocacy organizations commented that the interim final rule's exception allowing for the processing of child support orders issued by State child support agencies illegally and inappropriately permits the seizure of SSI payments and VA payments to pay child support obligations. Some organizations argued that the garnishment of these benefits for child support obligations is prohibited by 42 U.S.C. 659, a statute that permits garnishment orders to be served on the United States. Others commented that the rule should not provide the basis for garnishment of exempt Federal funds from bank accounts that cannot legally be offset directly from the Federal paying agency. Some commenters recommended that the Agencies incorporate in the rule the limitations that apply when child support arrearages are collected by offset directly from the Federal benefit agency, and ensure that these limits are applied to the garnishment of Federal funds from bank accounts.

One commenter suggested that the Agencies establish a minimum amount to be protected in every bank account even from garnishment orders issued from State child support enforcement agencies. This commenter recommended that the final rule provide that for garnishment pursuant to child support orders, the protected amount would include the lesser of the sum of 2 months' exempt deposits or $750 (one twelfth of $9,000). The Agencies note, however, that although Federal benefit payments deposited to a bank account are protected by statute from garnishment for most debts, Federal and state law provides that this protection generally does not extend to garnishments for child support once these benefits have been deposited into a bank account, with exceptions for certain benefits.

Another commenter suggested that the Agencies protect SSI payments from seizure for child support garnishment by adopting a procedure for financial institutions to follow when they receive a garnishment order from a State child support enforcement agency. That procedure would require financial institutions to examine every order that includes a “Notice of Right to Garnish Federal Benefits” to determine whether the order was obtained by a child support enforcement agency. For all such orders, the financial institution would have to conduct an account review to determine whether SSI payments were deposited to the account during the lookback period. To make it possible for financial institutions to identify SSI payments without manually reviewing the account history, financial institutions would have to make the programming changes necessary to detect the identifier for SSI payments located in positions 56-63 of the Company Entry Description field of the ACH Batch Header Record.

The Agencies did not previously seek comment on imposing a process on banks to prevent the potential garnishment of SSI or VA payments by child support enforcement agencies, because they were aware of U.S. Department of Health and Human Services Office of Child Support Enforcement (DHHS OCSE) instructions that direct State child support enforcement agencies not to serve orders on financial institutions to garnish SSI payments and DHHS OCSE's public information that VA payments are generally not subject to garnishment. 7 DHHS OCSE has recently issued additional guidance to State child support enforcement agencies reiterating its policy that SSI payments are not to be garnished and urging state agencies to implement automated and manual processes to prevent improper garnishments. See Dear Colleague Letter [DCL-13-06] and Fact Sheet “Garnishing Federal Benefits for Child Support.”

The Agencies do not have information on the difficulty or burden that would be associated with manually reviewing every order that includes a Notice. The Agencies also do not have information on the costs to financial institutions of making programming changes necessary to identify SSI or VA payments delivered to an account. However, these procedures would seem to impose an additional burden on financial institutions. In light of this potential burden, the Agencies have sought to evaluate the extent to which the garnishment of SSI or VA payments by child support enforcement agencies presents a genuine hardship for noncustodial parents.

After further consultation with DHHS OCSE, it does not appear that the garnishment of SSI or VA payments by child support enforcement agencies raises the same concerns that are raised by the garnishment of Federal benefits by commercial creditors. First, noncustodial parents receive substantial advance due process before a child support enforcement order is issued. This is in marked contrast to garnishment orders obtained by commercial creditors, where there is no advance due process and therefore no opportunity for the debtor to challenge the garnishment of benefit payments in a bank account until after the order has been executed. A noncustodial parent has the opportunity, before a child support enforcement order is issued, to notify the agency that the parent receives SSI or VA payments. Second, DHHS OCSE has instructed child support enforcement agencies not to serve orders on financial institutions to garnish SSI payments and has provided public information that VA payments generally are not subject to garnishment by child support enforcement agencies. Specifically, Federal payments subject to garnishment by child support enforcement agencies under 42 U.S.C. 659 are limited to payments based on remuneration for employment, which do not include SSI payments or VA payments other than those representing compensation for a service-connected disability paid to a former member of the Armed Forces who is in receipt of retired or retainer pay and who has waived a portion of the retired or retainer pay in order to receive such compensation. 8

Finally, if an account containing SSI or VA payments is garnished by a state child support enforcement agency, the noncustodial parent is not required to go to court to have the funds released and therefore does not necessarily face a time-consuming, expensive, and confusing process to free the funds. Rather, a noncustodial parent whose account is garnished for child support can contact the child support enforcement agency directly (usually by phone), explain that the account being garnished contains SSI or VA payments, and provide a copy of his or her SSI or VA payments statement in order to have the benefits released.

In the notice of proposed rulemaking, the Agencies explained the need for the rule:

It was the significant hardship posed by this after-the-fact due process procedure that the rule is designed to eliminate. Because the child support enforcement process does not raise the same concerns, and in light of the burden for financial institutions that would be created by instituting a new and separate process for handling child support enforcement orders, the Agencies are not revising the exception in the rule allowing for the processing of orders from State child support enforcement agencies when the appropriate notice is attached to the order. The Agencies note that nothing in the rule restricts or prevents an individual who receives SSI payments, VA payments or any other Federal benefit payments from challenging in court the garnishment of those payments for child support obligations in the event a State child support enforcement agency does serve such a garnishment order on a financial institution. The Agencies further note that nothing in this rule restricts or prevents an individual from challenging, in court, any order of garnishment against a benefit payment.

A State child support enforcement agency commented that the requirement to attach a Notice of Right to Garnish Federal Benefits places an additional and unnecessary compliance burden on States. The commenter also noted that as more States expand their electronic processing capabilities to include the transmission of documents, including garnishment orders/notices, the mandatory notice conflicts with the rationale for the electronic transmission of documents and serves to mitigate any associated cost benefits. The commenter recommended the requirement to attach the notice be made optional, and that the Agencies set forth the content or prescribed language for the certification of the right to garnish benefits. States could then choose to use the model notice to be deemed compliant or to ensure that their garnishment notices/orders contain the appropriate identifying language.

The Agencies believe that it is important that financial institutions be able to quickly identify whether a garnishment order was obtained by a State child support enforcement agency, without searching through the order itself to locate verbiage. Moreover, the Agencies do not believe that the inclusion of the notice precludes the electronic transmission of a garnishment order. Accordingly, the Agencies are not revising the requirement that the notice be attached to an order obtained by a State child support enforcement agency for such an order to be excluded from the rule's requirements.

One commenter urged the Agencies not to allow 2 business days in which to examine orders for the inclusion of a Notice of Right to Garnish Federal Benefit Payment and (if not present) conduct an account review. The commenter observed that court orders generally require garnishments to be processed on the day of receipt, and that banks that delay account reviews, but then find no benefit payments, will violate court orders. Another commenter suggested that the Agencies define “business day” with a cross reference to an existing regulation, preferably Regulation CC.

A trade association representing prepaid card providers commented that the 2 business day deadline for conducting the account review is unrealistic for financial institutions that issue prepaid cards because of the complexity in the administration of prepaid card programs. This commenter stated that financial institutions commonly support multiple prepaid card programs affiliated with a number of different programs and data processors, making the logistics of coordination more complex and time-consuming than with a regular deposit account. According to the commenter, determining the protected funds in such cases will require communication with several third-party vendors in addition to coordination of the account review by bank personnel. The commenter suggested that 5 business days would be an appropriate deadline.

A consumer advocacy organization commented that the Agencies should not exclude funds transferred from one account to another from the account review and the establishment of the protected amount if the benefit funds are transferred to special purpose savings accounts such as 529 plans and Individual Development Accounts.

Based on the extensive comments received on the interim final rule regarding the time allowed for conducting the account review, the Agencies believe it is necessary to allow 2 business days for financial institutions to identify orders subject to the rule and conduct account reviews, if required. It should be noted that financial institutions will not violate State law by utilizing the 2-day period, because the rule preempts any State requirement that an order be processed on the day of receipt. The Agencies understand that processing garnishment orders may involve more complexity in the context of prepaid card accounts, but believe that prepaid card holders who receive benefit payments on prepaid cards should have the same protection against improper garnishment orders as individuals whose benefit payments are directly deposited to conventional bank accounts. Accordingly, the Agencies are not extending the time period permitted for the account review for prepaid card accounts.

The Agencies are retaining in § 212.5(f) of the final rule the provision that funds transferred from one account to another are excluded from the account review and the establishment of the protected amount. Although the Agencies understand that exempt funds may be transferred to a special savings or other account following the initial deposit, requiring the examination of all account transfers after a Federal benefit payment has been identified would impose a significant burden on financial institutions, since they would not be able to rely on a transaction indicator, like the ACH identifier, in searching account histories to determine whether transferred funds should be classified as exempt. Moreover, the Agencies note that nothing in the rule restricts or prevents an individual from asserting that the benefit retained its exempt character and, thus, was not subject to garnishment.

One commenter suggested that the Agencies ensure that the requirement to provide “full and customary” access to an account containing a protected amount is not abused by explicitly stating that financial institutions are prohibited from closing such accounts. Another commenter requested guidance on the “full and customary access” requirement in States where a continuing garnishment order is served, requiring that any deposits into the account before the date on which the garnishment order expires (the “return date”) be garnished and any withdrawals before the return date be prevented. The commenter explained that there could be situations, in States that allow continuing garnishments, in which a protected amount is established for an account, but another account held by the account holder containing no protected amount would be subject to a continuing freeze. The commenter stated that it is customary for financial institutions to temporarily suspend the use of a debit card on all accounts connected to that debit card and that financial institutions cannot apply this suspension on an account-by-account basis. The commenter asked how a financial institution could comply with the requirement to freeze the second account while still allowing “full and customary access” to the account containing the protected amount.

The final rule does not address the conditions under which financial institutions may close accounts, which the Agencies believe is beyond the scope of this rule. The Agencies have conducted research into the ability of financial institutions to suspend debit card access to one account held by an account holder while enabling debit card access to another account. It appears that many financial institutions have the capability to do so. Moreover, the number of States in which this issue might arise is very small, since most States do not provide for continuing garnishments. The Agencies indicated in the preamble to the interim final rule that the requirement to provide the account holder with “full and customary” access to the protected amount was intended to ensure that after a garnishment order is received, the account holder continues to have the same degree of access to the protected funds that was provided prior to the receipt of the order. The Agencies' view is that where an account holder had debit card access to an account prior to the receipt of a garnishment order, the requirement to provide full and customary access to the protected amount means that the account holder should have debit card access to that amount.

Some commenters requested clarification on when a garnishment order constitutes a new or different order as opposed to the same order. In some States, financial institutions are served with recurring, short-term continuing garnishments. These garnishments are customarily re-issued after the date on which they expire (the “return date”). The reissued garnishment pertains to the same matter and the same parties and is procedurally required to continue to pursue collection of a judgment. The garnishment would have the same case number but be filed under a different execution number. Commenters questioned whether a garnishment order that is re-issued after its return date would be considered the “same” or a “new” garnishment order.

The Agencies have published a FAQ stating that a “new” garnishment order means that the creditor has gone back to court and obtained a new order, as opposed to re-filing an order that was previously served. 9 The FAQ indicated that, in the case of an order from a State child support enforcement agency, a new order would be an order that is not simply the re-delivery of the same order. The Agencies' view is that a garnishment order that is re-issued after the return date, under a different execution number, would not constitute a “new” garnishment order.

A number of financial institutions and their trade associations commented that financial institutions should be allowed to assess reasonable garnishment fees whether or not an account has excess funds beyond any protected amounts, and even if imposing the fee would create an overdraft in the account. Several commenters asserted that costs to financial institutions of processing garnishment orders will increase as a result of the rule and that in light of the fee restrictions imposed by the rule, banks may decide to close accounts. Financial institutions asserted that garnishment order processing and compliance is a very time-consuming and often complex process and that it is unreasonable for financial institutions, which are generally not a party to the dispute between the creditor and the debtor, not to be compensated for the expenses and liabilities they incur. Expenses cited by financial institutions in processing garnishment orders include salaries and benefits for staff receiving and logging garnishment orders, performing account searches, conducting account reviews, identifying and calculating available and protected funds, placing hold orders, processing remittances, mailing and filing notices and documentation, and handling inquiries from depositors and creditors, as well as legal and compliance support staff. Financial institutions argued that without the ability to charge the customer a fee each time an account review commences, the financial institution will be forced to recoup costs against all customers, creating unfairness to both the financial institution and the financial institution's other customers.

These commenters requested that the rule be revised to allow financial institutions to assess reasonable garnishment fees even in instances where the fee must be collected either partially or fully from protected amounts. They also requested that the Agencies revise the prohibition in § 212.6(g) against charging or collecting a garnishment fee after the date of the account review. In addition, a financial institution trade association requested that the final rule clarify that garnishment fee limitations do not apply to attorney's fees assessed by a court, and that such attorney's fees can be recovered from future nonprotected balances.

In contrast, a consumer advocacy group commented that the prohibition on charging a garnishment fee against a protected amount or charging a garnishment fee after the date of the account review should be extended to protect funds from any other fees triggered by the garnishment order. Another commenter proposed that the Agencies require the creditor to pay the garnishment fee charged by the financial institution upon filing the legal document and then have the creditor add this fee to the amount owed to the creditor by the debtor.

One commenter asked for clarification on whether the rule prohibits charging a garnishment fee in the following scenario: a customer has multiple separate accounts or subaccounts, only one of which receives electronic Federal benefit payments. The other accounts are not subject to the rule. The commenter asked if the financial institution could collect an agreed upon garnishment fee from accounts not subject to the rule. The commenter also asked if a financial institution could collect a garnishment fee from an account that is not subject to the regulation after the account review by taking that account balance negative.

The Agencies continue to believe that financial institutions should not be permitted to collect a fee from the protected amount and are not amending that provision of the rule. The Agencies are not expanding the prohibition on garnishment fees to encompass “any fee that arises as a result of a garnishment,” because such a definition would be overly broad. However, in light of the comments received, the Agencies have decided to amend the rule to provide financial institutions with an opportunity, for 5 days following the account review, to impose a garnishment fee in the event that nonprotected funds become available following the account review.

The Agencies stated in the preamble to the interim final rule that the prohibition on charging a garnishment fee after the date of account review was necessary because otherwise the rule would need to prescribe procedures that financial institutions would follow to monitor accounts in real time to track deposits and withdrawals, determine whether new deposits are exempt or not, and determine whether a garnishment fee could be imposed. In light of the comments received from financial institutions, the Agencies have decided to establish a procedure that financial institutions may follow, if they choose, for a limited time following the account review to determine whether nonprotected funds are available to support the imposition of a garnishment fee. If funds other than a benefit payment are deposited to an account during the 5 business days following the date of the account review, the financial institution may charge or collect a fee from the additional funds. In order to impose such a fee, a financial institution could choose to check the account at any time during the 5 days after the account review to determine if funds other than benefit payments were deposited.

In response to the question as to whether a garnishment fee may be collected from accounts that do not contain a protected amount, the Agencies emphasize that such accounts are not subject to any restrictions under this rule, and that a financial institution may collect an agreed upon garnishment fee from such accounts in accordance with the customer agreement and any applicable laws.

A number of comments were received regarding the form, contents and means of delivery of the notice that must be provided to account holders. One commenter stated that financial institutions should not be required to provide a notice to the account holder and that it would be appropriate to put this burden on the party issuing the garnishment order. Other commenters urged the Agencies to revise the rule to require a notice to an account holder only in cases where there are funds in the account in excess of the protected amount. The interim final rule requires that a financial institution send a notice to the account holder if the balance in the account on the date of the account review is above zero dollars and the financial institution establishes a protected amount. A number of financial institutions noted that this requirement means that a financial institution must notify an account holder when a garnishment order is received for an account into which exempt benefit payments have been electronically deposited during the lookback period even in cases where no account funds are frozen. Financial institutions commented that providing a notice in this situation is of no benefit to account holders and will result in unnecessary confusion to account holders, many of whom will be unlikely to read the entire notice and will erroneously believe that their entire account balance has been frozen. These commenters stated that financial institutions will incur the expense of preparing and mailing garnishment notices for accounts in which no funds will be turned over to a creditor, as well as for responding to inquiries from account holders confused by the notices.

One commenter recommended that financial institutions be permitted to mail the notice to the customer's address according to its records. Other commenters stated that it is unclear whether a bank is prohibited from sending notice to joint account holders. Financial institutions commented that they typically send notices regarding a joint account to all the account holders and that requiring that a garnishment order be sent solely to the person named in the order would require them to change their processes and would result in information not being communicated that the account holder likely would find important. In some States, according to commenters, State law requires banks to notify all account holders of a garnishment order that has been received and to send a copy of it to the account holders. Commenters therefore requested that the Agencies add a sentence at the end of § 212.7(e) in the final rule that states that a bank may follow its normal practice of communicating with joint account holders when sending a garnishment notice. They also requested that a conforming change be made to the model notice that indicates that the recipient of the notice may be receiving it because he or she is a joint holder of an account that has been garnished.

One financial institution trade group noted that § 212.7(e), which addresses delivery of the notice to the account holder, says only that a financial institution shall “issue” the notice directly to the account holder. This trade group stated that electronic notices can be provided promptly and securely and help banks to avoid unnecessary compliance costs, and requested that the Agencies allow a financial institution to issue a notice, or make a notice available, electronically, through an email or a proprietary Web site in instances where an account holder has consented to electronic communication.

The same commenter requested that the Agencies permit a bank to use either the model notice or an alternative version that provides the same information but in a more streamlined way. As proposed by the commenter, the alternative notice would have a copy of the garnishment order attached and would refer back to the order in places where the model notice requires information to be added that is unique to the garnishment in question.

With regard to the requirement that contact information for the creditor be included in the notice, a commenter noted that generally garnishments served on our clients arrive with limited information about the creditor, but full contact information for the attorney for the creditor. The commenter questioned whether financial institutions should include, in lieu of limited information on the creditor, the full information to contact the attorney for the creditor. Another commenter recommended that the list of protected payments be removed from the model notice because the list must be updated continuously.

The Agencies agree that the requirement to send a notice to account holders in cases where there are no funds in excess of the protected amount may be of little benefit and is likely to result in unnecessary confusion for some account holders. Accordingly, the Agencies are revising the rule to require a notice to an account holder only in cases where there are funds in the account in excess of the protected amount. With regard to the delivery of notices, the Agencies believe it is acceptable for financial institutions to mail the notice to the address of record, and do not believe that anything in the rule suggests otherwise. In the case of joint accounts affected by a garnishment order, financial institutions may deliver the notice to both account holders, but there is no obligation to do so. The Agencies do not believe it is necessary to amend the rule to state specifically that a bank may follow its normal practice of communicating with joint account holders when sending a garnishment notice. In such a case, the financial institution may indicate in its notice that the recipient of the notice may be receiving it because he or she is a joint holder of an account that has been garnished. The rule does not specify the means of delivery of the notice, so that any method of delivery for notices agreed to between the financial institution and the account holder, including electronic delivery, would be acceptable.

The Agencies are not creating an alternative to the model notice. Financial institutions are not required to use the model notice and may create their own alternative notices. In cases where a financial institution receives a garnishment order with limited information about the creditor, but full contact information for the creditor's attorney, the Agencies' view is that the financial institution may include, in lieu of limited information on the creditor, the full information to contact the attorney for the creditor.

The Agencies are not removing the list of protected payments from the notice because this information is likely to be helpful to account holders. The payments included in the list have been protected from garnishment by Federal statutes for many years and there is no reason to anticipate a change in these statutes.

Some financial institutions expressed confusion over the interplay of the rule with State law and questioned how the preemption of State law would work in certain situations. One commenter posed a scenario in which State law treats a joint account held by two spouses as being held in tenancy by the entirety, and protects the account from garnishment unless the garnishment order is in both spouses' names. The commenter pointed out that where a garnishment order naming just one spouse is served on the financial institution, and protected benefit payments are deposited to the account, the rule would require that an account review be performed and a protected amount established. However, under State law, the account would not be subject to garnishment at all. The commenter questioned the interplay between the rule and State law in this scenario. Another commenter questioned whether, when protected benefit payments are deposited to an account, the rule is to be applied exclusively, or whether the rule is to be applied to determine a protected amount followed by the application of a more protective State law to funds exceeding the protected amount in the same account.

A financial institution trade group suggested that the Agencies provide guidance on how the rule operates in the context of a specific State law by maintaining an “evergreen” set of FAQs that are updated as issues are raised.

One credit union association commented that it conceptually opposes the rule in its entirety with specific note to the “continuing garnishment” provision at § 212.6(g) and argued that § 212.6(g) is both a logically unpermitted exercise of authority and unconstitutional.

As discussed above (See Initial action upon receipt of a garnishment order (§ 212.4)), the rule's requirements presuppose that a financial institution would give effect to a garnishment order. It serves no useful purpose to follow the rule's procedures in situations where a financial institution has made a determination not to take any action against an account on the basis of a garnishment order. Accordingly, if a financial institution will not act on a garnishment order due to the operation of State law, the financial institution need not examine the order to determine if a Notice of Right to Garnish Federal Benefits is attached or included or take any of the additional steps required under the rule.

The Agencies intend to maintain the FAQs that have been published as an “evergreen” document, meaning that they will be updated as appropriate. However, the Agencies do not intend to routinely address preemption questions within the FAQs.

The Agencies do not agree that the “continuing garnishment” provision at § 212.6(g) is an unconstitutional exercise of authority. As discussed in the preamble to the interim final rule, the rule's treatment of continuing garnishments is necessary to give proper effect to the anti-garnishment statutes that the rule is implementing, since it is not possible to implement both a protected amount and give effect to continuing actions related to a garnishment order. See 76 FR 9946.

A State banker's association commented that some banks would like more specificity as to what the record keeping requirement encompasses. This commenter suggested that the Agencies create a “job aid” for financial institutions that would make it clear what documentation a financial institution is required to maintain for 2 years. The Agencies believe that it is up to financial institutions to decide what documentation to retain, and that the appropriate documentation may vary depending on the circumstances of each situation.

A banking trade group commented that benefit payments should not be protected from garnishment where the garnishment order is for the purpose of recouping fraudulently obtained benefits. This commenter suggested that the Agencies address this scenario in the rule by creating an exception in the rule that would require financial institutions to give effect to an order that states on its face that benefit payments were obtained fraudulently, without regard to the protection from garnishment that otherwise would apply to properly-obtained benefit payments.

The Agencies do not believe that financial institutions should be required to read and make judgments on the basis for, and merits of, garnishment orders, and have structured the rule accordingly. In the case of garnishment orders to recover fraudulently issued Federal benefits, such benefits will typically be recovered in an action by the United States, which can attach a Notice of Right to Garnish Federal Benefits, if applicable.

A bank trade association recommended that the effective date of the final rule be delayed for 6 to 12 months following its publication, stating that it would take that long for most community banks to be able to implement the necessary systems programming and testing required to automate the detection of the unique ACH identifiers. A financial institution questioned whether the rule applies to continuing court orders already in place prior to May 1, 2011 or whether a Notice of Right to Garnish Federal Benefits must be provided in order for the financial institution to continue to honor such orders.

The interim final rule has been in effect since May 1, 2011, and the Agencies understand that financial institutions generally began implementing the rule's requirements as of that date. The amendments to the interim final rule in this rulemaking should not change or complicate compliance, and the Agencies therefore are not delaying the effective date of the final rule beyond the 30 days prescribed by the Administrative Procedure Act (5 U.S.C. 553(d)). The rule does not, however, apply retroactively to orders, including continuing orders, that were in place prior to the May 1, 2011 effective date.

One commenter requested that the FAQs either be incorporated directly into the rule or attached as an appendix. The Agencies believe it would be cumbersome, and unnecessary, to amend the regulation to codify the informal interpretive guidance included in the FAQs. The Agencies anticipate that they may modify or add to the FAQs to clarify issues that may be raised in the future. Codifying the FAQs in the rule would preclude the Agencies from amending the FAQs without going through a notice-and-comment rulemaking process.

The definition of “benefit payment” is revised to mean a direct deposit payment that includes not only an “XX” in positions 54 and 55 of the Company Entry Description field, but also the number “2” encoded in the Originator Status Code field of the Batch Header Record of the direct deposit entry.

The definition of “garnishment order” and “order” is revised to include a levy, and also to include orders issued by States and municipalities, as well as orders to freeze assets.

The definition of “protected amount” is revised to refer to the balance in an account when the account review is performed.

Section 212.6(h) is revised to provide an exception to the prohibition against charging or collecting a garnishment fee after the date of account review, i.e., retroactively. Under the exception, if funds other than a benefit payment are deposited to the account at any time within 5 business days following the date of the account review, the financial institution may charge or collect a fee from the additional funds.

Section 212.7 is revised to require that the financial institution send a notice to an account holder only where financial institution has established a protected amount and there are funds in the account in excess of the protected amount.

The examples demonstrating how the protected amount is calculated have been revised to reflect the use of the account balance when the account review is performed rather than the opening balance in the account on the day of the account review.

Executive Orders 13563 and 12866 direct agencies to assess costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rule has been designated a “significant regulatory action” although not economically significant, under section 3(f) of Executive Order 12866. Accordingly, the rule has been reviewed by the Office of Management and Budget.

In the proposed rule, the Agencies prepared a joint Initial Regulatory Flexibility Analysis and requested comment on the proposed rule's impact on small entities. Based on the Agencies' analysis of the comments on the proposed rule and based on a survey of small credit unions conducted by the Treasury, the Agencies certified that the interim final rule would not have a significant economic impact on a substantial number of small entities. One credit union, one bank and one credit union association commented that in their opinion the interim final rule does impose a burden, that the burden on financial institutions will likely be more significant than the Agencies believe, and that the burden will be more significant for small institutions. One of these commenters stated that it will take hours of manpower and some system reprogramming to meet the rule's requirements. Another commenter stated that smaller credit unions may not find it cost effective to upgrade their systems in order to automate the measurement of the lookback period and the performance of the account review in light of the small number of garnishment orders they receive. This commenter stated that although the time required to conduct an account review may be minimal, time spent reviewing the account is necessarily time the employee cannot spend working on his or her day-to-day responsibilities. None of the commenters provided any estimates of costs.

Some of the changes that the Agencies are adopting in the final rule will reduce the costs and burden of complying with the rule's requirements. Financial institutions will have an additional opportunity to charge a garnishment fee, and thereby recoup some costs, because the rule allows a fee to be charged against any nonprotected amounts deposited to an account within 5 business days following the account review. In addition, financial institutions will not be required to send a notice to an account holder unless there are funds in the account in excess of the protected amount. In light of these changes and for the reasons discussed in the interim final rulemaking, the Agencies certify that this final rule will not have a significant economic impact on a substantial number of small entities, in accordance with 5 U.S.C. 605(b).

Executive Order 13132 outlines fundamental principles of Federalism, and requires the adherence to specific criteria by Federal agencies in the process of their formulation and implementation of policies that have “substantial direct effects” on the States, the relationship between the national government and States, or on the distribution of power and responsibilities among the various levels of government. Federal agencies promulgating regulations that have these Federalism implications must consult with State and local officials, and describe the extent of their consultation and the nature of the concerns of State and local officials in the preamble to the regulation.

In the Agencies' view, nothing in this final rule affects the Federalism implications already considered in the promulgation of the interim final rule. The Agencies stated, when promulgating the interim final rule, that the rule may have Federalism implications, because it has direct, although not substantial, effects on the States, the relationship between the national government and States, or on the distribution of power and responsibilities among various levels of government. The provision in the rule (§ 212.5) that establishes a process for financial institutions' treatment of accounts upon the receipt of a garnishment order could potentially conflict with State garnishment laws prescribing a formula for financial institutions to pay such claims.

The rule's central provision requiring a financial institution to establish a protected amount will affect only a very small percentage of all garnishment orders issued by State courts, since in the vast majority of cases an account will not contain an exempt Federal benefit payment. Moreover, States may choose to provide stronger protections against garnishment, and the regulation will only override State law to the minimum extent necessary to protect Federal benefits payments from garnishment.

Under 42 U.S.C. 407(a) and 42 U.S.C. 1383(d)(1), Federal Old-Age, Survivors, and Disability Insurance benefits and Supplemental Security Income payments are generally exempt from garnishment. 42 U.S.C. 405(a) provides the Commissioner of Social Security with the authority to make rules and regulations concerning Federal Old-Age, Survivors, and Disability Insurance benefits. The Social Security Act does not require State law to apply in the event of conflict between State and Federal law.

Under 38 U.S.C. 5301(a), benefits administered by VA are generally exempt from garnishment. 38 U.S.C. 501(a) provides the Secretary of Veterans Affairs with the authority to make rules and regulations concerning VA benefits. The statutes governing VA benefits do not require State law to apply in the event of conflict between State and Federal law.

Under 45 U.S.C. 231m(a), Federal railroad retirement benefits are generally exempt from garnishment. 45 U.S.C. 231f(b)(5) provides the RRB with rulemaking authority over issues rising from the administration of Federal Railroad retirement benefits. The Railroad Retirement Act of 1974 does not require State law to apply in the event of conflict between State and Federal law.

Under 45 U.S.C. 352(e), Federal railroad unemployment and sickness benefits are generally exempt from garnishment. 45 U.S.C. 362(1) provides the RRB with rulemaking authority over issues rising from the administration of Federal railroad unemployment and sickness benefits. The Railroad Unemployment Insurance Act does not require State law to apply in the event of a conflict between State and Federal law.

Under 5 U.S.C. 8346, for the Civil Service Retirement System (CSRS) and under 5 U.S.C. 8470, for the Federal Employees Retirement Systems (FERS), Federal retirement benefits are generally exempt from garnishment. 5 U.S.C. 8347 and 5 U.S.C. 8461, respectively, provide the Director of OPM with the authority to make rules and regulations concerning CSRS and FERS benefits. OPM benefits statutes do not require State law to apply in the event of conflict between State and Federal law.

In accordance with the principles of Federalism outlined in Executive Order 13132, the Agencies consulted with State officials on issues addressed in the interim final rule. Specifically, the Agencies sought perspective on those matters where Federalism implications could potentially conflict with State garnishment laws. The final rule does not present new Federalism implications that have not already been considered during the promulgation of the interim final rule.

Section 202 of the Unfunded Mandates Reform Act of 1995, Public Law 104-4 (Unfunded Mandates Act) requires that an agency prepare a budgetary impact statement before promulgating a rule that includes a Federal mandate that may result in expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any 1 year. If a budgetary impact statement is required, section 205 of the Unfunded Mandates Act also requires an agency to identify and consider a reasonable number of regulatory alternatives before promulgating a rule. The Agencies have determined that this rule will not result in expenditures by State, local, and tribal governments, or by the private sector, of $100 million or more. Accordingly, the Agencies have not prepared a budgetary impact statement or specifically addressed the regulatory alternatives considered.

Accordingly, the interim final rule which was published at 76 FR 9939 on February 23, 2011, is adopted as a final rule with the following changes:

An interim final rule was published in the Federal Register on April 27, 2011 (76 FR 23479-23485) that established the TYA program by implementing Section 702 of the Ike Skelton NDAA for FY 2011 (Pub. L. 111-383). The TYA program provides TRICARE Program coverage to unmarried children under the age of 26 of TRICARE-eligible sponsors who no longer meet the age requirements for TRICARE eligibility (age 21, or 23 if enrolled in a full-time course of study at an approved institution of higher learning, and the sponsor provides more than 50 percent of the student's financial support), and who are not eligible for medical coverage from an eligible employer-sponsored plan based on their individual employment status (as defined in section 5000A(f)(2) of the Internal Revenue Code of 1986). If qualified, they can purchase TRICARE Standard/Extra or TRICARE Prime benefits coverage. The particular TRICARE option available depends on the uniformed service sponsor's eligibility and the availability of the TRICARE option in the dependent's geographic location.

The interim final rule was published in the Federal Register on April 27, 2011. One online comment was received via www.regulations.gov. We thank the commenter for the comments. Specific matters raised by those comments are summarized below.

1. Provisions of Interim Final Rule. This paragraph describes the nature, purpose, statutory basis, scope, and major features of TYA, a full cost, premium-based TRICARE Program coverage made available for purchase worldwide. TYA is similar to young adult coverage under the Patient Protection and Affordable Care Act, but reflects a number of differences between TRICARE, a statutorily-created DoD health benefits program and typical civilian health care plans. Among these is that TYA is a full cost premium based program; it is limited to unmarried dependent children of TRICARE-eligible sponsors; and the dependent child must not be eligible for medical coverage from an eligible employer-sponsored plan based on their individual employment status (an exclusion that does not expire on January 1, 2014, but is permanent). TYA is codified in Title 10, United States Code, Section 1110b.

The major features of the program include making TYA coverage available for purchase at a premium which will represent the full cost, including reasonable administrative costs, as determined on an appropriate actuarial basis for coverage. There will be various premiums depending on whether the dependent's sponsor is active duty, retired, or eligible under another option such as TRICARE Reserve Select (TRS) or TRICARE Retired Reserve (TRR), and the adult dependent's desired health coverage—TRICARE Standard/Extra or, for those eligible and where available, TRICARE Prime. The rules and procedures otherwise outlined in Part 199 of 32 CFR which implements Chapter 55 of Title 10, U.S. Code, relating to the operation and administration of the TRICARE program based on the sponsor's status and health coverage plan will apply for cost-shares, deductibles, and catastrophic caps upon purchasing TYA coverage. Young adult dependents of members on active duty orders written, or otherwise continuous, for more than 30 days are eligible for benefits under the TRICARE Extended Care Health Option (ECHO) program under § 199.5 of this Part. The TRICARE Dental Program (§ 199.13 of this Part) and the TRICARE Retiree Dental Program (§ 199.22 of this Part) are not included as part of TYA.

Under TYA, qualified young adult dependents may purchase individual TRICARE Program coverage by submitting a completed request in the appropriate format along with an initial payment of the applicable premium at the time of enrollment. When TRICARE Program coverage becomes effective, a TYA purchaser receives the TRICARE benefits according to the rules governing the TRICARE Program that the dependent qualified for and selected based on the uniformed services sponsor's status (active duty, retired, Selected Reserve, or Retired Reserve) and the availability of a desired TYA option in his or her geographic location. The rules and procedures otherwise outlined in the TRICARE Regulation (Part 199) relating to the operation and administration of the TRICARE programs will apply for cost-shares, deductibles, and catastrophic caps upon purchasing TYA coverage. The young adult dependent's cost-shares, deductibles, and catastrophic caps will be based on the sponsor's status (active duty, retired, Selected Reserve, or Retired Reserve) and whether the dependent has purchased TRICARE Standard/Extra or Prime coverage. TYA dependents are provided access priority for care in military treatment facilities based on their uniformed services sponsor's status and the selection of a TYA option.

The Continued Health Care Benefits Program (CHCBP) (see § 199.20) shall be made available to all young adult dependents after aging out of the TYA program or who otherwise lose their eligibility for the TYA program, whether due to a change in the status of the young adult and/or the status of their sponsor. CHCBP participants are not eligible for military treatment facility (MTF) care other than in emergencies.

2. Analysis of Major Public Comments: One comment noted support for the TYA program because it will undoubtedly increase health insurance coverage for those who may have gone uninsured.

Response: We acknowledge the commenter's statement as consistent with the purposes of the TYA program.

3. Provisions of the Final Rule.

In § 199.26(a), we clarified that the uniformed service sponsors must be TRICARE eligible to qualify their eligible dependents to purchase TYA coverage. We also clarified the criteria for TRICARE eligibility up to the age of 23.

In § 199.26(a)(4)(i)(D), we deleted a potentially misleading reference to § 199.3 of this Part. Eligibility and qualifications for the TYA program as defined in § 199.3 of this Part will be clarified in § 199.26(b).

We clarified in § 199.26(a)(4)(i)(D)( 2 ) that TRICARE Prime coverage may be available for purchase by dependents of sponsors who are retired members if otherwise qualified, but not dependents of sponsors who are in the Retired Reserve if their sponsor participates in TRR. Dependents of retired members in the Retired Reserve are only eligible to purchase TRICARE Standard/Extra coverage. Also, it was an error to state that the retired member must be eligible for a TRICARE Prime plan as a qualification for the young adult dependent to be eligible to purchase TRICARE Prime coverage. Dependents of retired members other than members of the Retired Reserve may purchase TRICARE Prime coverage if otherwise qualified even if the retired sponsor is not eligible for or enrolled in TRICARE Prime.

1. Provisions of the Interim Final Rule. This paragraph defines the statutory conditions under which unmarried children of TRICARE-eligible sponsors qualify as young adult dependents under the TYA program. To qualify as a young adult dependent, the dependent must be under the age of 26, not be otherwise eligible for another TRICARE Program, and not be eligible for medical coverage from an eligible employer-sponsored plan based on their individual employment status (as defined in section 5000A(f)(2) of the Internal Revenue Code of 1986). The dependents' sponsor is responsible for keeping the Defense Enrollment Eligibility Reporting System (DEERS) current with eligibility data through the sponsor's Service personnel office. Using information from the DEERS, TRICARE contractors have the responsibility to validate a dependent's qualifications to purchase TYA coverage.

2. Analysis of Major Public Comments. No public comments were received relating to this section of the rule.

3. Provisions of the Final Rule. In § 199.26(b)(1)(i), we clarified that former dependents under the Transitional Compensation Program (TCP) under 10 U.S.C 1059 as defined in § 199.3(b)(2)(iii) of this Part are not eligible to purchase TYA coverage because TRICARE coverage for these former dependents under the TCP is not authorized by chapter 55 of title 10 United States Code (U.S.C.), nor by section 1145a of 10 U.S.C, but rather by section 1059 of 10 U.S.C.

In that same paragraph, we clarify that dependents of North Atlantic Treaty Organization (NATO) sponsors as defined in § 199.3(a) of this Part are not eligible to purchase TYA coverage because NATO treaties do not specifically address young adult coverage.

1. Provisions of Interim Final Rule. Qualified young adult dependents are charged premiums for coverage under TYA that represent the full cost of providing TRICARE benefits under this program, including the reasonable costs of administration of the program. The total annual premium amounts shall be determined by the Assistant Secretary of Defense for Health Affairs (ASD(HA)) using an appropriate actuarial basis and are established and updated annually, on a calendar year basis, by the ASD(HA) for qualified young adult dependents. A premium shall be charged for each individual qualified young adult dependent regardless of whether a sponsoring member has more than one young adult dependent child who qualifies or purchases coverage under the TYA program. The cost shares for TRICARE Standard/Extra or Prime programs in which the adult child is enrolled shall be based on the status of the dependent's sponsor. Because of the differences in cost-shares among the programs and status of the sponsor, there will be a different premium for TRICARE Standard/Extra and TRICARE Prime, including the Uniformed Services Family Health Plan. Premiums are to be paid monthly. The monthly rate for each month of a calendar year is one-twelfth of the annual rate for that calendar year.

The appropriate actuarial basis used for calculating premium rates shall be one that most closely approximates the actual cost of providing care to the same demographic population as those enrolled in TYA as determined by the ASD(HA). TYA premiums shall be based on the actual costs of providing benefits to TYA dependents during the preceding years if the population of young adult dependents enrolled in TYA is large enough during those preceding years to be considered actuarially appropriate. Until such time that actual costs from those preceding years become available, TYA premiums shall be based on the actual costs during the preceding calendar years for providing benefits to the population of dependents over the age 21 until reaching age 26 in order to make the underlying group actuarially appropriate. An adjustment may be applied to cover overhead costs for administration of the program by the government. Additionally, premium adjustments may be made to cover the prospective costs of any significant program changes.

2. Analysis of Major Public Comments. No public comments were received relating to this section of the rule.

3. Provisions of the Final Rule. The final rule is consistent with the interim final rule.

1. Provisions of Interim Final Rule. The Director, TRICARE Management Activity (TMA) will establish procedures for administration of TYA. These will include procedures to purchase individual coverage, such as a request in an approved format, along with an initial payment of the applicable premium. Applicants must also certify that they meet the statutory qualifications to purchase coverage under this program. Additional procedures will be established for a qualified young adult dependent to purchase TYA coverage with an effective date immediately following the last effective date of coverage under which they previously qualified in another TRICARE option.

There will be open enrollment so that a qualified young adult dependent may purchase TYA coverage at any time. The effective date of coverage for TRICARE Standard/Extra will coincide with the first day of a month after the date the application and required payment is received. The effective date of coverage for TRICARE Prime will be the first day of the second month after the month in which application and required payment is received. There will be a limited period for retroactive coverage. A qualified young adult dependent may elect to start coverage under the TRICARE Standard/Extra plan effective with the statutory start date of January 1, 2011, if the dependent was eligible as of that date. If retroactive coverage is elected then retroactive premiums must be paid back to the statutory start date of January 1, 2011. If no retroactive coverage is elected or the retroactive premiums are not paid within the time prescribed, then coverage will not be retroactive and coverage will apply only prospectively beginning on the first day of the month after the date of the application. There shall be no retroactive coverage offered under any TRICARE Prime plan. No purchase of retroactive coverage may take place after September 30, 2011.

With respect to termination of coverage, a loss of eligibility or entitlement for medical benefits of the sponsor will result in termination of coverage for the dependent's TYA coverage on the same date as the sponsor, unless otherwise authorized. Upon the death of an active duty sponsor, young adult dependents may purchase TYA coverage until reaching age 26. If a Selected Reserve (Sel Res) or Retired Reserve member ends TRS or TRR coverage, respectively, eligibility for the young adult dependent to purchase coverage under TYA also ends. If a Sel Res sponsor dies while enrolled in TRS, the otherwise eligible young adult dependent can purchase TYA coverage up to 6 months after the death of the sponsor. If a Retired Reserve sponsor dies while enrolled in TRR, the otherwise eligible young adult dependent may continue to purchase TYA coverage until the date on which the deceased sponsor would have turned age 60. If the Retired Reserve sponsor was not enrolled in TRR at the time of death, there is no eligibility to purchase TYA coverage until the sponsor would have turned age 60. As of the date on which the deceased retired sponsor would have turned age 60, the young adult dependent qualifies as a survivor of a deceased retired sponsor and can purchase TYA coverage until reaching age 26. Coverage will terminate whenever a dependent ceases to meet the qualifications for the program. Claims will be denied effective with the termination date. In addition, covered dependents may terminate coverage at any time by submitting a completed request in the appropriate format. Dependents whose coverage under TYA terminates for failure to pay premiums in accordance with program requirements will not be allowed to purchase coverage again under TYA for a period of one year following the date of their coverage termination. This ineligibility period shall be known as a “lockout” period. A request for a waiver of the “lockout” period may be granted by the Director, TRICARE Management Activity, based on extraordinary circumstances beyond the control of the young adult dependent which resulted in inability to make payments in accordance with program requirements. The Director may allow a 90-day grace period for payment to be made. However, if payment is not made by the 90th day, then coverage will be deemed to have terminated as of the last day of the month in which an appropriate payment was made and no claims may be paid for care rendered after the date of termination. Upon termination of eligibility to purchase TYA coverage, qualified dependents may purchase coverage under the CHCBP for up to 36 months except if locked out of TYA. Upon application and payment of appropriate premiums, a young adult dependent who has already purchased coverage under any of the options offered under TYA may change to another TRICARE option for which the dependent is eligible. Eligibility is based on the sponsor's status and the dependent's geographic location.

2. Analysis of Major Public Comments. No public comments were received relating to this section of the rule.

3. Provisions of the Final Rule. In § 199.26(d)(2)(i)(A), we deleted eligibility to purchase TYA coverage by former dependents in the Transitional Compensation Program under 10 U.S.C 1059 and under § 199.3(b)(2)(iii) of this Part. We added eligibility to purchase TYA coverage for dependents of former active duty members covered under the Transitional Assistance Management Program (TAMP) who are otherwise qualified.

We added a new § 199.26(d)(2)(iii) to add that young adult dependents currently enrolled in TYA may have their TRICARE coverage terminated when the sponsor's status changes (for example, from active duty to retired status). Young adult dependents have 30 thirty days to re-establish their TYA coverage without a break in coverage and must re-qualify for TYA coverage for which they are then eligible.

In § 199.26(d)(2) and subordinate paragraphs, we clarified the rule that procedures may be established for TYA coverage to be suspended up to one year followed by final termination for young adult dependents if they fail to make premium payments in accordance with established procedures or otherwise request suspension/termination of coverage. Procedures may be established for the suspension to be lifted upon request before final termination is applied. Procedures may also be established for the suspension to be lifted upon request for undue hardship as defined by § 199.26(g) before final termination is applied.

In § 199.26(d)(5), we added that upon a change in sponsor status, young adult dependents currently enrolled in TYA coverage may have their coverage automatically transferred to another TRICARE option consistent with the sponsor's new status. Recurring TYA premiums may be automatically adjusted by the servicing contractor.

1. Provisions of Interim Final Rule. This paragraph provides that the preemptions of State and local laws established for the TRICARE program also apply to TYA. Any State or local law or regulation pertaining to health insurance, prepaid health plans, or other health care delivery, administration, and financing methods is preempted and does not apply in connection with TYA.

2. Analysis of Major Public Comments. No public comments were received relating to this section of the rule.

3. Provisions of the Final Rule. The final rule is consistent with the interim final rule.

1. Provisions of Interim Final Rule. This paragraph provides that the Director, TRICARE Management Activity, may establish other administrative processes and procedures necessary for the effective administration of TYA.

2. Analysis of Major Public Comments. No public comments were received relating to this section of the rule.

3. Provisions of the Final Rule. The final rule is consistent with the interim final rule.

1. Provisions of Interim Final Rule. New paragraph.

2. Analysis of Major Public Comments. No public comments were received relating to this section of the rule.

3. Provisions of the Final Rule. Added definition of undue hardship as it relates to suspension and termination of TYA coverage.

Executive Orders 12866 and 13563 require certain regulatory assessments for any significant regulatory action that would result in an annual effect on the economy of $100 million or more, or have other substantial impacts. This rule will not. This final rule will not have an impact on the economy greater than $100 million annually.

The Congressional Review Act establishes certain procedures for major rules, defined as those with similar major impacts. This final rule will not have a major impact as that term is used under the Congressional Review Act.

This rule does not contain unfunded mandates. It does not contain a Federal mandate that may result in the expenditure by State, local, and tribunal governments, in aggregate, or by the private section, of $100 million in any one year.

The Regulatory Flexibility Act (RFA) requires that each Federal agency prepare, and make available for public comment, a regulatory flexibility analysis when the agency issues a regulation that would have significant impact on a substantial number of small entities. This final rule will not have a significant impact on a substantial number of small entities.

This rule will impose additional information collection requirements on the public under the under the provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35) in the form of a TYA application form. Comments were solicited via the interim final rule published on April 27, 2011 (76 FR 23479-23485). No comments were received. OMB approved the TYA application form and assigned the collection of information OMB Control Number 0720-0049.

We have examined the impact(s) of the final rule under Executive Order 13132 and it does not have policies that have federalism implications that would 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. The preemption provisions in the rule conform to law and long-established TRICARE policy. Therefore, consultation with State and local officials is not required.

Accordingly, 32 CFR part 199 is amended as follows:

Table of Acronyms DHS Department of Homeland Security FR  Federal Register NPRM Notice of Proposed Rulemaking A. Regulatory History and Information

The Coast Guard is issuing this temporary final rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because publishing an NPRM would be impracticable. The Coast Guard did not receive necessary information from the event sponsor in time to publish a notice of proposed rulemaking. The event is scheduled to take place, and as such, immediate action is necessary to ensure the safety of vessels, spectators, participants, and others in the vicinity of the marine event on the dates and times this rule will be in effect.

Under 5 U.S.C. 553(d)(3), for the same reasons mentioned above, the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register . Delaying the effective date would be impracticable for the reasons cited above.

The legal basis for this temporary rule is the Ports and Waterways Safety Act which authorizes the Coast Guard to establish safety zones (33 U.S.C sections 1221 et seq.).

Pyro Spectaculars is sponsoring the When Pigs Fly Fireworks Display, which will be conducted from a barge located in the vicinity of the USS MIDWAY in San Diego Bay. A safety zone is needed for the navigable waters around the barge, which will be located in the following approximate position: 32 42′46.71″ N 117 10′39.44″ W. A safety zone is necessary to provide for the safety of the crew, spectators, and other vessels and users of the waterway. The sponsor will provide a chase boat to patrol the safety zone and inform vessels of the safety zone.

The Coast Guard is establishing a safety zone that will be enforced from 8:30 p.m. to 9:30 p.m. on June 11, 2013. The limits of the safety zone will include all the navigable waters within 600 feet of the nearest point of the fireworks barge in approximate position 32 42′46.71″ N 117 10′39.44″ W.

The safety zone is necessary to provide for the safety of the crews, spectators, and other vessels and users of the waterway. Persons and vessels will be prohibited from entering into, transiting through, or anchoring within the safety zone unless authorized by the Captain of the Port, or his designated representative.

We developed this rule after considering numerous statutes and executive orders related to rulemaking. Below we summarize our analyses based on these statutes and executive orders.

This rule is not a significant regulatory action under section 3(f) of Executive Order 12866, Regulatory Planning and Review, as supplemented by Executive Order 13563, Improving Regulation and Regulatory Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of Executive Order 12866 or under section 1 of Executive Order 13563. The Office of Management and Budget has not reviewed it under those Orders. We expect the economic impact of this rule to be so minimal that a full Regulatory Evaluation is unnecessary. The safety zone is of a limited duration, one hour, and is limited to a relatively small geographic area.

The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601-612, as amended, requires federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities. This rule will affect the following entities, some of which may be small entities: the owners or operators of vessels intending to transit or anchor in the impacted portion of the San Diego Bay on June 11, 2013 between 8:30 p.m. and 9:30 p.m.

This rule will not have a significant economic impact on a substantial number of small entities for the following reasons. The safety zone will be in effect for a short duration, one hour, late at night when vessel traffic is low. Additionally, vessel traffic can pass around the safety zone.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the FOR FURTHER INFORMATION CONTACT , above.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.

This rule will not call for a new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

A rule has implications for federalism under Executive Order 13132, Federalism, if it has 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. We have analyzed this rule under that Order and determined that this rule does not have implications for federalism.

The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to contact the person listed in the FOR FURTHER INFORMATION CONTACT section to coordinate protest activities so that your message can be received without jeopardizing the safety or security of people, places or vessels.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Though this rule will not result in such expenditure, we do discuss the effects of this rule elsewhere in this preamble.

This rule will not cause a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

We have analyzed this rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not create an environmental risk to health or risk to safety that may disproportionately affect children.

This rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

This action is not a “significant energy action” under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use.

This rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards.

We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves establishment of a safety zone. This rule is categorically excluded from further review under paragraph 34(g) of Figure 2-1 of the Commandant Instruction. An environmental analysis checklist supporting this determination and a Categorical Exclusion Determination are available in the docket where indicated under ADDRESSES . We seek any comments or information that may lead to the discovery of a significant environmental impact from this rule.

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:

The Community Residential Care (CRC) program is an important component in VA's continuum of care. It operates under the authority of 38 U.S.C. 1730, which, at subsection (a), provides that VA may refer a veteran for placement in a CRC facility if VA is furnishing outpatient medical services or hospital, domiciliary, or nursing home care to the veteran or has furnished the veteran with such care in the preceding 12 months, and placement in a CRC facility is appropriate. Under 38 U.S.C. 1730(b), VA cannot refer a veteran to a CRC facility unless VA approves the facility.

CRC facilities provide room, board, limited personal care, and supervision to veterans who do not require hospital or nursing home care but are unable to live independently because of medical or mental health conditions, and who have insufficient family resources to provide care. The veteran pays for the cost of this living arrangement. VA's contribution is limited to approving CRCs for inclusion on VA's list of approved CRC facilities. As part of the approval process, VA inspects the facility utilizing the criteria listed in 38 CFR 17.63 and conducts post-inspection monitoring. VA provides clinical services, including medical care provided by VA health care professionals, to veterans residing in CRC facilities. A CRC facility may be referred to by different names in various states and settings, such as: Medical Foster Homes, Assisted Living, Personal Care Homes, Family Care Homes, and psychiatric CRC Homes. The CRC program currently approves 826 CRC facilities serving more than 6,100 veterans, accounting for more than 398,000 bed days of care per calendar quarter.

VA's regulations governing the CRC program appear at 38 CFR 17.61 through 17.72. Decisions regarding approval of CRC facilities are made by an approving official at a local VA medical center level. The term “approving official” is defined at § 17.62(e) as a Director of a VA Medical Center or Outpatient Clinic which has jurisdiction to approve the CRC facility, or other medical center officials listed in that section who may be designated by the Director. As provided in § 17.65(a), the approving official may approve a CRC facility, based on the report of a VA inspection and any findings of necessary interim monitoring of the facility, if the facility meets the standards listed in § 17.63. The standards found in § 17.63 cover a wide variety of issues related to health and safety as well as quality of life, environment, and administrative requirements. For example, § 17.63 provides standards for fire safety, heating and air conditioning, interior building plans, laundry service, size and furnishing requirements for the residents' bedrooms, nutrition, activities, residents' rights, and staffing and administrative requirements. The current regulation requires CRCs to meet all of these standards before an approving official may grant approval of a CRC facility.

Under § 17.65(b), if there is an identified deficiency that does not jeopardize the health or safety of the residents, the CRC facility may obtain provisional approval if the deficiency can be corrected and VA and the facility agree on a plan to correct the deficiency. If the deficiency is not corrected per the agreement, the provisional approval is terminated, as provided in §§ 17.66 through 17.71. Upon revocation of VA approval for a CRC facility, VA is required to cease referring veterans to the CRC facility, notify any veteran residing in the facility that VA has disapproved the facility, and request permission to assist in the veteran's removal if the veteran chooses to leave.

There currently is no provision whereby VA may waive a standard delineated in § 17.63. However, VA has determined that there may be instances in which a CRC facility may have a minor deficiency that cannot be corrected but which does not jeopardize the health or safety of resident veterans. We find that it is appropriate to provide a mechanism to waive the standard applicable to that minor deficiency and authorize approval of the CRC facility under § 17.65(a) or (b). An example of an instance in which a waiver would be appropriate would involve a CRC facility that would qualify for full approval but for the fact that a single-resident room measures slightly less than 100 square feet (as required under § 17.63(e)(2)), and the deficiency cannot be corrected without compromising the structural integrity of the facility. Waiver would be appropriate in this instance in order to ensure that a veteran is not discouraged from using an appropriate CRC facility located near his or her home, or to otherwise avoid more restrictive and/or costly care.

This interim final rule amends § 17.65 by adding a new paragraph (d) providing that VA may waive a standard found in § 17.63 for the approval of a particular CRC facility if the deficiency does not jeopardize the health or safety of the residents, and the deficiency cannot be corrected as provided for in § 17.65(b). VA may grant a waiver of a standard applicable to the facility if the VA safety expert certifies that the deficiency does not endanger the life or safety of the residents; the deficiency cannot be corrected; and it is in the best interests of the veteran and VA's CRC program. The first two criteria in a waiver determination are objective; however, it is important for VA to retain some discretion in rare cases where waiving a particular standard would not be in the best interests of a particular veteran in the facility or the overall interests of VA's CRC program. We believe that this last criterion would be used to deny a waiver only in rare circumstances. For example, if a newly purchased CRC facility has a window defect that cannot be corrected due to the effect of the correction on the rest of the structure, but the facility should have been aware of the deficiency when it purchased the structure, it might be against the interests of the CRC program to authorize a waiver. Or, if a facility cannot meet a standard related to the quality of life for its residents but waiving that standard will have a negative impact on a veteran, VA might not authorize the waiver. Again, we believe that waivers will be appropriate in the majority of cases when the deficiency does not endanger the life or safety of residents and do not envision using this last criterion to deny waivers in many cases. Additionally, we note that, if needed to make a waiver eligibility determination, the VA safety expert may request supporting documentation from the CRC facility.

Under paragraph (d)(2), the subject standard is deemed to have been met once the waiver is granted. During the period the waiver is valid and in place, VA will document the existence of the waiver as well as the date it was issued on the facility's annual survey. Under paragraph (d)(3), the waiver remains valid so long as the CRC facility remains in the program continuously without a break. However, VA may, on the recommendation of an approving official, rescind a waiver issued under this section if a VA inspector determines that there has been a change in circumstances and that the deficiency can now be corrected, or a VA safety expert finds that the deficiency jeopardizes the health and safety of residents.

Finally, we make a technical edit to § 17.66. This section details notice requirements if the hearing official determines that a CRC facility is not compliant with VA standards. Current paragraph (c) of § 17.66 cross-references § 17.51n for community residential care facilities to request oral or paper hearings before VA approval is revoked. On May 13, 1996, 61 FR 21965, VA redesignated § 17.51n as § 17.67. We are removing the reference to § 17.51n and adding, in its place, § 17.67.

Title 38, Code of Federal Regulations, as revised by this interim final rulemaking, represents VA's implementation of its legal authority on this subject. Other than future amendments to this regulation or governing statutes, no contrary guidance or procedures on this subject are authorized. All VA guidance must be read to conform with this rulemaking if possible or, if not possible, such guidance is superseded by this rulemaking.

In accordance with 5 U.S.C. 553(b)(B), the Secretary of Veterans Affairs has concluded that ordinary notice and comment procedures would be impracticable and contrary to the public interest, and is accordingly issuing this rule as an interim final rule. This interim final rule is necessary to address an immediate need to provide a mechanism that will allow VA to grant a waiver to a CRC facility that cannot obtain full approval because of a minor deviation from regulatory standards that cannot be corrected and does not endanger the lives or safety of the veteran residents. Although approval would be rescinded because of a minor and uncorrectable deviation from standards unrelated to health or safety, veterans may be dissuaded from maintaining their residence in such facility. Providing a waiver in that circumstance will preclude the need to terminate a CRC facility's approval based on an uncorrectable minor deviation from non-safety related standards. This eliminates the potential that resident veterans will needlessly choose to leave an otherwise healthy, safe, and suitable living arrangement. Current regulations do not provide for any waiver of standards. An example of where a waiver may be appropriate is a CRC facility with a resident bedroom that is slightly smaller than the required 100 square feet of floor area for a single-resident room. Resident bedroom size is a quality of life rather than a health or safety standard. It is in the public interest for a veteran not to be removed from a stable living situation based solely on a minor deviation from standards that does not threaten life or safety.

To prevent veterans from needlessly choosing to leave affected CRC facilities because the facilities are no longer on the approved list, and in order to ensure timely implementation of the program established by this rule, and for the reasons stated above, the Secretary also finds, in accordance with 5 U.S.C. 553(d)(3), good cause for this interim final rule to be effective on the date of publication.

The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This interim final rule will have no such effect on State, local, and tribal governments, or on the private sector.

This interim final rule contains no provisions constituting a collection of information under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501-3521). Documentation that a VA safety expert may request from a community residential care facility to support a waiver determination, as provided under 38 CFR 17.65(d)(1), would not qualify as “information” under the PRA because collection of this information would be conducted on an individual case-by-case basis and would require individualized information pertaining to the specific deficiency identified by the VA safety expert. We believe that this collection is therefore exempt from the PRA requirements, as provided under 5 CFR 1320.3(h)(6) (excluding from PRA requirements a “request for facts or opinions addressed to a single person”).

The Secretary hereby certifies that this interim final rule will not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. This interim final rule will have little, if any, economic impact on a few small entities. VA may waive a standard under this rulemaking provided a VA safety expert certifies that the deficiency does not endanger the life or safety of the residents, the deficiency cannot be corrected, and granting the waiver is in the best interests of the veteran in the facility and VA's CRC program. In order to reach the above determinations, the VA safety expert may request supporting documentation from the CRC facility. VA believes supplying this information will constitute an inconsequential amount of the operational cost for those CRC facilities. VA believes that, at most, only a few CRC facilities would qualify for a waiver. On this basis, the Secretary certifies that the adoption of this interim final rule will not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act. Therefore, pursuant to 5 U.S.C. 605(b), this rulemaking is exempt from the initial and final regulatory flexibility analysis requirements of sections 603 and 604.

Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 12866 (Regulatory Planning and Review) defines a “significant regulatory action” requiring review by the Office of Management and Budget (OMB), unless OMB waives such review, as “any regulatory action that is likely to result in a rule that may: (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive Order.”

The economic, interagency, budgetary, legal, and policy implications of this regulatory action have been examined, and it has been determined not to be a significant regulatory action under Executive Order 12866.

The Catalog of Federal Domestic Assistance numbers and titles for the programs affected by this document are 64.007, Blind Rehabilitation Centers; 64.008, Veterans Domiciliary Care; 64.009, Veterans Medical Care Benefits; 64.010, Veterans Nursing Home Care; 64.011, Veterans Dental Care; 64.012, Veterans Prescription Service; and 64.022, Veterans Home Based Primary Care.

The Secretary of Veterans Affairs, or designee, approved this document and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs. Jose D. Riojas, Interim Chief of Staff, approved this document on May 8, 2013, for publication.

For the reasons stated in the preamble, VA amends 38 CFR part 17 as set forth below:

On March 1, 2012, VA published in the Federal Register (77 FR 12517) a proposed rule to amend VA regulations to establish VADIP, a pilot program that would offer premium-based dental insurance to enrolled veterans and certain survivors and dependents of veterans. Section 510 of title V of the Caregivers and Veterans Omnibus Health Services Act of 2010, Public Law 111-163 (2010), requires VA to carry out a pilot program to assess the feasibility and advisability of providing a dental insurance plan to veterans and survivors and dependents of veterans. To comply with section 510(a), VA will contract with a private dental insurer to offer dental insurance coverage to the individuals identified in section 510(b), specifically veterans enrolled in VA's system of annual enrollment under 38 U.S.C. 1705, and survivors and dependents of veterans who are eligible for medical care under 38 U.S.C. 1781. This final rule establishes rules and procedures for VADIP, in accordance with section 510(k), which requires VA to prescribe regulations.

Interested persons were invited to submit comments to the proposed rule on or before April 30, 2012, and we received 28 comments. Many of the comments were supportive of VADIP, and did not suggest changes to the proposed rule. For the remaining comments, we have organized the discussion below accordingly.

Certain commenters who expressed support for VADIP also seemed to advocate that VADIP is necessary because, by comparison, they believe that VA dental care under 38 U.S.C. 1712 (referred to in this preamble as “VA dental benefits”) are not adequately administered to veterans. Specifically, these commenters contended that VADIP was necessary because only limited groups of veterans are eligible to receive VA dental benefits, or because VA staff do not understand or properly communicate the eligibility requirements for VA dental benefits. Generally, we respond that comments regarding veteran eligibility for VA dental benefits or the adequacy of VA dental benefits are beyond the scope of this rulemaking, because section 510 clearly distinguishes between VA dental benefits and VADIP insurance by requiring VA to contract with a private insurer to administer VADIP, and by requiring that VA maintain its statutory responsibility to furnish VA dental benefits to certain veterans even if those veterans also participate in VADIP. See Public Law 111-163, sections 510(e), 510(j). Therefore, we do not specifically respond to these comments because these issues are outside the scope of this rulemaking.

However, we do respond to a few commenters who based their support for VADIP on misinterpretations of eligibility for VA dental benefits, because these misinterpretations seemed to also create confusion for the commenters regarding VADIP eligibility. For instance, multiple commenters misstated that only veterans with a service-connected disability rated at 100 percent are eligible to receive VA dental benefits, and consequently advocated that the rule should permit veterans with less than a 100 percent service-connection rating to enroll in VADIP. We do not make any changes to the rule based on these comments because § 17.169(b)(1) makes clear that any veteran who is enrolled in the VA health care system in accordance with 38 CFR 17.36 is eligible to enroll in VADIP, and enrollment under § 17.36 is not solely based upon a veteran's service-connection rating, at any level. Additionally, we clarify that there are categories of eligibility for VA dental benefits that are based on dental conditions that are service-connected and compensable in degree, but not requiring an overall rating of 100 percent, as well as categories of eligibility that are based on criteria that are unrelated to any level of service-connection. See 38 U.S.C. 1712, 2062; see also 38 CFR 17.160-17.166.

Some commenters who expressed support for VADIP also advocated that family members of veterans should be eligible to enroll in VADIP. We do not make any changes to this rule based on these comments. Section 510(b)(2) limits VADIP eligibility for veteran family members to only those survivors and dependents of veterans who are eligible for medical care under 38 U.S.C. 1781, implemented as VA's Civilian Health and Medical Program (CHAMPVA). See 38 CFR 17.270-17.278. Consequently, § 17.169(b)(2) limits VADIP eligibility for veteran family members who are eligible for medical care under 38 U.S.C. 1781 and 38 CFR 17.271.

One commenter asserted more specifically that VADIP insurance should be available to family members of veterans with a 100 percent service-connection rating before it is provided to family members of veterans with lower service-connection ratings, because VA dental benefits are only provided to 100 percent service-connected veterans. We reiterate that VADIP insurance is not VA dental benefits and is not comparable to VA dental benefits, and that VA dental benefits are not limited to only 100 percent service-connected veterans. With regard to the eligibility of family members of veterans for VADIP, we do not make any changes based on this comment. Only survivors and dependents of veterans who are eligible for CHAMPVA may be enrolled in VADIP. Although certain eligibility criteria for CHAMPVA benefits do consider whether a veteran has a service-connected disability or condition, CHAMPVA eligibility is not solely based on a veteran's service-connection rating. See, e.g., 38 CFR 17.271(a)(3).

Although this rule may not expand eligibility for VADIP to veteran family members beyond section 510(b)(2), we do not interpret any part of section 510 as preventing a private insurer, participating in VADIP, from providing a different type of dental insurance plan to veteran family members who may not be eligible for VADIP under section 510(b)(2). Consequently, nothing in this rule prohibits a VADIP-participating private insurer from forming non-VADIP contractual relationships with anyone. However, a VADIP-participating private insurer may not use any VA health information to which it is privy, by virtue of participating in VADIP, to solicit or market directly to any person who is not eligible to enroll in VADIP under section 510(b).

Multiple commenters who expressed support for the rule additionally advocated that VADIP should be broadly available geographically. One commenter specifically stated that VADIP should be offered in all VA Integrated Service Networks (VISN), instead of select VISNs. It is unclear why the commenter believed VADIP would be administered only in select VISNs; the proposed rule did not implement regional restrictions, and we do not intend that VADIP be administered only in certain VISNs. Therefore, we do not make any changes to the rule based on this comment. Although section 510(d) does state that the VADIP pilot program “shall be carried out in such [VISNs] as the Secretary considers appropriate,” we reiterate, from the proposed rule, that the intent is that VADIP insurance be provided as broadly as possible, given the insurer's coverage capabilities as determined during the Federal contracting process. See 77 FR 12518. Although VA cannot predict the breadth of geographic coverage, limitations will only be due to what insurers ultimately are able to provide. To this end, VA will attempt, via the Federal contracting process, to ensure that VADIP geographic coverage is broad.

Some commenters advocated making VADIP available in the Philippines and Guam. We do not make any changes to the rule based on these comments. As noted above, the rule does not limit VADIP insurance from being provided in any particular VISN; both the Philippines and Guam are located in VISN 21. We note that the provision of VADIP insurance in areas outside the United States is controlled by section 510 and not by any other VA authorities to provide VA care outside of the United States, because VADIP insurance is not VA care and is not administered by VA as a medical benefit. We are not guaranteeing or advocating coverage in any specific geographic area, because coverage may be limited by multiple factors that are beyond VA's control. For example, insurers may be limited to providing VADIP coverage only in areas where they are licensed to provide insurance.

As mandated by section 510(h)(3), § 17.169(c)(1) requires that VADIP premiums and any copayments will be paid by the insured. Multiple commenters advocated that VA should ensure that these costs are affordable for VADIP enrollees, without specifically requesting changes to the rule except as noted below. First, we address the general concerns as expressed by commenters related to cost. Under section 510(h)(1) and (h)(2), VA must establish VADIP premium amounts and adjust those amounts annually. Section 510 is silent about VA establishing copayment amounts, although section 510(h)(3) states that VADIP enrollees will be responsible for the full cost of any copayment amounts.

Under § 17.169(c)(1), both premium and copayment amounts will be determined through the Federal contracting process. To the extent that commenters may wish for VA to actually establish the costs of VADIP premiums and copayments in the rule, and further ensure that such costs are affordable, we will not know such costs until contracts with insurers are negotiated. We expect, through the Federal contracting process, to negotiate with insurers to establish multiple tiers of coverage within the comprehensive listing of dental care services in § 17.169(c)(2). This will help ensure that VADIP enrollees have a choice to pay premium and copayment amounts proportionate to the services they want covered.

Multiple tiers of coverage will prevent all VADIP enrollees from being required to pay higher premium amounts or copayments that would typically be associated with covering the full range of services listed in § 17.169(c)(2). Establishing tiers of coverage in this manner is standard practice in the dental insurance industry, and will assist in keeping premium and copayment costs manageable for VADIP enrollees. Multiple tiers of coverage with varying premium and copayment amounts are also supported by section 510. See Public Law 111-163, sections 510(h)(1), (h)(3) (indicating that multiple “[p]remiums” will be established and adjusted by VA, and that each individual covered by VADIP will be responsible to pay the full cost of any “copayments”). We do not make any changes to the rule to set forth specific tiers of coverage, however, because such determinations are better suited to the contract negotiations that VA will conduct with insurers.

We additionally note that for purposes of analyzing insurer risk, typically a large number of enrollees can assist with keeping premiums, copayments, and other administrative costs low. As reported in the proposed rule, VA anticipates that between 101,000 and 201,000 individuals will apply to enroll in VADIP each year, based on the sizable groups of individuals eligible to enroll under section 510(b). See 77 FR 12520. We will conduct the Federal contracting process anticipating this large number of expected enrollees and attempt to secure reasonable premium and copayment pricing for VADIP plans.

In relation to the scope of VADIP coverage and pricing, one commenter stated that veterans and their family members need coverage for “all dental preventive and corrective care that is more affordable [than] the current Delta Dental Plan.” This commenter further criticized “the current Delta Dental Plan” for instituting waiting periods for certain dental services, such that these services are not considered covered until after an insured is enrolled for a specific period of time. We are unsure of the specific plan to which the commenter intended to refer, but we interpret this comment to advocate that VA should ensure that VADIP provides more dental services at a less expensive price, and with fewer restrictions, than typically provided in an insurance plan that is offered by a large dental insurer like Delta Dental. We do not make any changes based on this comment.

VA must contract with a private dental insurer to administer VADIP, and therefore the administration of VADIP will be subject to standard practices and market factors that are present in the dental insurance industry. For example, VA may not be able to negotiate a contract with a private insurer that does not institute waiting periods for certain services or procedures, if the standard practice in the dental insurance industry is to institute such waiting periods. VA must ensure that an insurer offers the coverage VA prescribes, that premiums are established and adjusted annually, and that certain other requirements, as mandated by section 510, are met. VA must also contract with dental insurers within the framework of the dental insurance industry to implement these requirements, and as such these dental insurers may administer VADIP according to certain standard industry practices that commenters expressed were objectionable. Consequently, VADIP coverage may not be priced less expensively than other comparable coverage typically offered in the dental insurance industry, and coverage may be subject to restrictions that typically exist in comparable dental insurance plans. We further note that dental benefits that must be offered under § 17.169(c)(2) are comprehensive, and reiterate, as stated above, that VA will attempt to secure reasonable premium and copayment pricing through multiple tier options to allow enrollees to choose coverage that is appropriate and affordable for them.

One commenter from the dental insurance industry recommended multiple options to include in VADIP plans that, in the commenter's opinion, would keep costs lower for VADIP enrollees. These options included instituting waiting periods for certain specific benefits; establishing fixed fees that VA may charge for internal administrative needs related to the VADIP contracts; and instituting lock-out periods, a provision for those insureds who opt to leave VADIP, so that such individuals would be prevented from re-enrolling in VADIP before a specific period of time had passed. This commenter did not request that the rule should enact such options as mandatory provisions, but only that these options should be considered in the insurance plans themselves, which would be formed when VA contracts with private insurers to administer VADIP. VA will consider contract options with insurers to reduce costs for VADIP enrollees as part of the negotiation process, which may include some or all of the above suggestions.

Although we interpret the cost-saving suggestions made by this commenter to relate to the contracting process rather than to the regulation, the suggestion to make re-enrollment subject to lock-out periods is a contract option that would be prevented if the regulation text is not changed. Section 17.169(d)(2), as proposed, alerted the public to a month-to-month enrollment option, after the 12-month initial enrollment period. This could be interpreted to mean that an insured may re-enroll at any time on a month-to-month basis regardless of any lock-out period in a VADIP contract. Lock-out periods are standard in most dental insurance contracts to discourage individuals from enrolling on an intermittent basis, only as services are needed. Continuous enrollment is thus incentivized, which helps ensure lower premiums for all insureds by increasing predictability of the insured group's size, and allowing for sufficient premiums to be collected to cover anticipated treatments costs. Therefore, we amend the language of § 17.169(d)(2) from the proposed rule to make the month-to-month enrollment subject to a new paragraph (e)(5) in the rule. Paragraph (e)(5) will read “[m]onth-to-month enrollment, as described in paragraph (d)(2) of this section, may be subject to conditions in insurance contracts, whereby upon voluntarily disenrolling, an enrollee may be prevented from re-enrolling for a certain period of time as specified in the insurance contract.” This change reflects our original intent to consider cost-saving contract options.

One additional option advanced by this industry commenter was to enable enrollees to use pre-tax dollars for premiums and copayments. We interpret this as a request that VA permit enrollees to treat premium payments and certain other VADIP costs as a pre-tax deduction, for purposes of reducing an enrollee's overall taxable income. Although not stated by the commenter, we interpret this suggestion as referring to “cafeteria” insurance plans, which allow employers to offer or sponsor insurance plans that may provide tax savings to both employees and employers. See 26 U.S.C. 125. Enrollment in a “cafeteria” plan can create tax savings for an employee, typically because the employee will contribute a portion of his or her salary on a pre-tax basis to pay for the qualified insurance benefits. These contributions are usually made pursuant to salary reduction agreements between the employer and the employee. Because these contributions are reductions in salary and are not received by the employee, they are not considered wages for income tax purposes.

VA is not offering VADIP plans as an employer, and therefore may not offer or sponsor VADIP as a “cafeteria” plan under 25 U.S.C. 125 for the purposes of pre-tax treatment of insurance premiums. VA will not participate in the collection of premiums or otherwise establish automatic deduction mechanisms for the payment of premiums. Instead, under § 17.169(c)(1), VADIP insureds will make premium and copayments in accordance with the terms of their VADIP insurance plan. We, therefore, do not make any changes to the rule based on this comment.

A commenter from the dental insurance industry stated that “[i]t is important that VA exercise Federal preemption similar to that of the [Department of Defense TRICARE Retiree Dental Program (TRDP)] and the Federal Employee Dental and Vision Insurance Program (FEDVIP).” The commenter asserted that Federal preemption of State insurance law or regulation was necessary for VADIP to be successful, because such preemption would allow for the implementation of uniform benefits in all States and would reduce the overall cost of VADIP. We agree with the commenter that uniformity of benefits provided at a reasonable cost are important interests for VA to consider in implementing VADIP. Although we interpret that Congress intended to legislate about the business of insurance in several subsections of section 510, and in turn that certain provisions of this rule could have preemptive effect, we make no changes to the rule based on this comment. We intend to publish a separate direct final rule to address preemption in VADIP to ensure that all affected parties have notice of VA's intent to assert the preemptive effect of certain subsections of section 510, and to provide VA an opportunity to consult with States and State officials in compliance with Executive Order 13132, Federalism.

Lastly, a commenter advocated that the duration of the VADIP pilot program should be extended from 3 years to 5 years, because this longer time frame would help ensure higher enrollment, would help spread initial administrative costs over a longer time, and would provide VA with more time to collect data on the administration of VADIP to determine if VADIP is feasible. Section 510(c) is clear that the duration of VADIP is to be no more than 3 years. Therefore, we do not make any changes to the rule based on this comment.

Two nonsubstantive changes are being made that were not requested by commenters, to ensure consistency in VADIP administration. The first nonsubstantive change is to the headings of § 17.169 and to § 17.169(a)(1), to remove the word “Plan,” so that VADIP is consistently known as the “VA Dental Insurance Program,” and not the “VA Dental Insurance Plan Program.” The second nonsubstantive change is a renumbering of the paragraphs under § 17.169(e), to properly distinguish between involuntary and voluntary disenrollment. Specifically, § 17.169(e)(1) as proposed referred to both involuntary and voluntary disenrollment within one paragraph, and sought to set forth the various bases for voluntary disenrollment under § 17.169(e)(1)(i) through (e)(1)(v). To ensure there is no confusion, we removed language related to voluntary disenrollment from § 17.169(e)(1) as proposed and placed this language in the new § 17.169(e)(2), and renumbered § 17.169(e)(2) and (e)(3) as proposed to § 17.169(e)(3) and (e)(4), respectively. We also corrected the reference to voluntary disenrollment procedures in renumbered § 17.169(e)(3), to refer to paragraphs (e)(2)(i) through (e)(2)(v).

Based on the rationale set forth in the proposed rule and in this document, VA is adopting the provisions of the proposed rule as final with changes to § 17.169(a)(1), (d)(2) and (e).

Title 38 of the Code of Federal Regulations, as revised by this final rulemaking, represents VA's implementation of its legal authority on this subject. Other than future amendments to this regulation or governing statutes, no contrary guidance or procedures are authorized. All existing or subsequent VA guidance must be read to conform with this rulemaking if possible or, if not possible, such guidance is superseded by this rulemaking.

The Paperwork Reduction Act of 1995 (at 44 U.S.C. 3507) requires that VA consider the impact of paperwork and other information collection burdens imposed on the public. Under 44 U.S.C. 3507(a), an agency may not collect or sponsor the collection of information, nor may it impose an information collection requirement unless it displays a currently valid Office of Management and Budget (OMB) control number. See also 5 CFR 1320.8(b)(3)(vi).

This final rule will impose the following new information collection requirement: Applications are needed so that individuals can voluntarily participate in VADIP. Procedures for voluntary disenrollment, as well as appeals of disenrollment decisions, are needed to ensure that enrollment remains voluntary, and that disenrollment determinations are timely. As required by the Paperwork Reduction Act of 1995 (at 44 U.S.C. 3507(d)), VA has submitted this information collection to OMB for its review. OMB approved the new information collection requirement associated with the final rule and assigned OMB control number 2900-0789.

The Secretary hereby certifies that this final rule will not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. Only dental insurers, certain veterans and their survivors and dependents, which are not small entities, will be affected. Therefore, pursuant to 5 U.S.C. 605(b), this rulemaking is exempt from the initial and final regulatory flexibility analysis requirements of sections 603 and 604.

Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 12866 (Regulatory Planning and Review) defines a “significant regulatory action” which requires review by the Office of Management and Budget (OMB), as “any regulatory action that is likely to result in a rule that may: (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive Order.”

The economic, interagency, budgetary, legal, and policy implications of this final rule have been examined, and it has been determined not to be a significant regulatory action under Executive Order 12866.

The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This final rule will have no such effect on State, local, and tribal governments, or on the private sector.

The Catalog of Federal Domestic Assistance numbers and titles for the programs affected by this document are 64.009 Veterans Medical Care Benefits and 64.011 Veterans Dental Care.

The Secretary of Veterans Affairs, or designee, approved this document and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs. Jose D. Riojas, Interim Chief of Staff, approved this document on May 13, 2013, for publication.

For the reasons stated in the preamble, VA amends 38 CFR part 17 as follows:

For the purpose of this document, we are giving meaning to certain words or initials as follows:

(i) The words or initials “Act” or “CAA” mean or refer to the Clean Air Act, unless the context indicates otherwise.

(ii) The words “EPA”, “we”, “us” or our mean or refer to the United States Environmental Protection Agency.

(iii) The initials “SIP” mean or refer to State Implementation Plan.

(iv) The words “Washington” and “State” mean the State of Washington.

Detailed information on the history of the PM 2.5 NAAQS as it relates to the Tacoma-Pierce County nonattainment area is included in the EPA's proposal for this action (78 FR 4804, January 23, 2013). As discussed in the proposal, on September 4, 2012, the EPA published a final “clean data” determination of attainment, based upon complete certified ambient air monitoring data showing that the Tacoma-Pierce County nonattainment area met the 2006 PM 2.5 NAAQS for the 2009-2011 monitoring period (77 FR 53772). Since the determination, monitored PM 2.5 levels continue to decline in the Tacoma-Pierce County nonattainment area. Monitoring data for 2010-2012 show a preliminary design value of 28 µg/m 3 . 1

The clean data determination suspended the obligation for the State of Washington to submit an attainment demonstration, associated reasonably available control measures, a reasonable further progress plan, contingency measures, and other SIP revisions related to attainment of the standard for so long as the nonattainment area continues to meet the 2006 PM 2.5 NAAQS. However, a clean data determination does not suspend the obligation under CAA section 172(c)(3) for submission and approval of a comprehensive, accurate, and current inventory of actual emissions. Accordingly, Ecology submitted Appendix A, titled “2008 Baseline Emissions Inventory and Documentation,” of its November 28, 2012, SIP revision to meet the emissions inventory obligation under CAA section 172(c)(3). Ecology also submitted Appendix B of the SIP revision, titled “SIP Strengthening Rules,” which contained the most recent version of Regulation 1—Article 13: Solid Fuel Burning Device Standards, adopted by the Puget Sound Clean Air Agency Board on October 25, 2012, imposing more stringent standards to control PM 2.5 emissions from wood smoke. The EPA proposed to approve both Appendix A and Appendix B of Washington's November 28, 2012, SIP revision consistent with sections 110 and 172 of the CAA.

The EPA received no comment on its proposed approval of Appendix B. On February 22, 2013, EPA received one comment on its proposed approval of Appendix A. This comment, submitted by Mr. Robert Ukeiley on behalf of Sierra Club, focused on the potential impact of coal export terminals proposed for the Pacific Northwest. The commenter wrote that Ecology's 2008 Baseline Emissions Inventory does not sufficiently address potential impacts as they relate to current or future shipments of coal via rail through the Tacoma-Pierce County nonattainment area. The EPA is responding to this comment in two parts: (1) Comment on Fugitive Coal Dust Emissions; and (2) Comment on Railroad Emission Calculations.

Comment: The commenter wrote that Ecology's 2008 Baseline Emissions Inventory does not meet the CAA section 172(c)(3) requirement which states that, “[s]uch plan provisions shall include a comprehensive, accurate, current inventory of actual emissions from all sources of the relevant pollutant or pollutants in such area, including such periodic revisions as the Administrator may determine necessary to assure the requirements of this part are met.” Specifically, the commenter wrote that the 2008 Baseline Emissions Inventory is not comprehensive because it did not account for fugitive coal dust emissions from coal trains that may have transited through the nonattainment area. The commenter also requests that “[i]f the current fugitive coal dust emissions are zero because there are no coal trains traveling through the Tacoma nonattainment area, then the inventory should say that.”

Response: As noted in the proposal for this action, the EPA referred to the August 2005 “Emissions Inventory Guidance for Implementation of Ozone and Particulate Matter NAAQS and Regional Haze Regulations” (hereafter “emissions inventory guidance” or “guidance”), to assess the adequacy of Washington's submission. The guidance covers several elements related to this comment. First, the mobile source section in the guidance contains no discussion or requirement for calculating fugitive dust from locomotive payloads. Instead, fugitive dust emissions from all source categories are discussed in section 5.4 of the guidance addressing nonpoint sources. The guidance states, “[n]onpoint sources are generally described as those sources that are too small, numerous, or difficult to be inventoried individually. Potential nonpoint sources of emissions are given in Table 5.4-1 and potential crustal (dust) sources of PM emissions are in Table 5.4-2. These tables are presented as guides to assist State, local and Tribal agencies in focusing their nonpoint source emission inventory efforts.” The guidance goes on to state, “[t]he State, local and Tribal agencies may want to concentrate their efforts on the most significant source categories.” The guidance acknowledges that States cannot individually inventory all nonpoint source emissions, but should use the best available data to inform which nonpoint source categories to focus on in creating a comprehensive and accurate inventory of actual emissions.

As part of the effort to focus on the most significant source categories, Ecology conducted extensive speciation analysis included in the docket for the EPA's proposed action, see Sources of Fine Particles in the Wapato Hills-Puyallup River Valley PM 2.5 Nonattainment Area (the name formerly used for the Tacoma-Pierce County nonattainment area), April 2010. Speciation analysis, also called receptor modeling or source apportionment, is a method of using chemical signatures from monitoring samples to determine both the types of emission sources impacting a monitor and the magnitude of those source impacts. The study examined monitoring samples from 2006 to 2009 and used chemical signature information to identify the relevant emission sources. Ecology determined that 4% of PM 2.5 annually in the Tacoma-Pierce County nonattainment area originated from the combination of all fugitive dust sources. To put this number in perspective, the contribution from fugitive dust was only slightly greater than the PM 2.5 contribution from sea salt. The percent contribution from fugitive dust was also found to be the lowest during winter months when violations of the 2006 PM 2.5 standard occur. From an analysis of fugitive dust impacts and wind direction, Ecology concluded that the majority of the PM 2.5 related fugitive dust was likely re-suspended dust from on-road motor vehicle traffic and fugitive emissions from a gravel operation near the monitoring site. Ecology's speciation analysis for the one violating Tacoma monitor on South L Street concluded by stating, “[f]ugitive dust was poorly correlated with total PM 2.5 mass (r2 = 0.19) indicating that its influence on the measured total mass was not significant.”

As described above, the 2005 emissions inventory guidance recognizes that agencies may need to concentrate their efforts on the most significant source categories, and the closely related regulations at 40 CFR 51.20 for reporting under the National Emissions Inventory (NEI) also state, “[n]onpoint source categories or emission events reasonably estimated by the State to represent a de minimis percentage of total county and State emissions of a given pollutant may be omitted.” Based on Ecology's analysis of fugitive dust impacts on 2006 PM 2.5 concentrations in the area, the EPA agrees with Ecology that fugitive dust emissions from railroad transport of coal do not constitute a significant source category for the 2008 Baseline Emissions Inventory. To the extent that the commenter raises issues related to coal export proposals that may impact the Tacoma-Pierce County nonattainment area in the future, or to the calculation of changes to the emission sources after 2008, the EPA has determined that these questions are beyond the scope of the 2008 Baseline Emissions Inventory. The inventory required under section 172(c)(3) does not require submission or assessment of future emissions.

The EPA also concludes that the 2008 Baseline Emissions Inventory accurately represents the emission sources that led to the EPA's nonattainment designation for Tacoma-Pierce County in 2009. In particular, the inventory informed and helped support development of the residential wood smoke control measures approved in this action. In 2008, residential wood combustion represented 74% of all emissions during the critical winter season, well above all other emission sources. To the extent that the mix of emission sources may change over time from the 2008 Baseline Emissions Inventory, the EPA believes these changes are best addressed as part of the maintenance plan inventory process to ensure continued compliance with the NAAQS, or as part of the attainment planning requirements that would become applicable should the area not continue in attainment. In response to the concerns raised by the commenter, the EPA independently analyzed publicly available data from the speciation monitor and found no evidence of increasing fugitive dust trends from 2008 to 2011. See Tacoma PMF Soil Results, included in the docket for this action. As noted previously, monitored PM 2.5 levels in the nonattainment area continue to decline below the level of the NAAQS. For the reasons stated above, the EPA has determined that Ecology's 2008 Baseline Emissions Inventory is consistent with applicable guidance and satisfies the requirement of CAA section 172(c)(3).

Comment: The commenter notes that Ecology's 2008 Baseline Emissions Inventory submission includes only a summary of emissions from railroad locomotive diesel consumption, without the corresponding background information used to calculate the estimates. The commenter states that the background information is necessary for both public understanding and for future conformity obligations under the CAA.

Response: Since emission control measures for railroad locomotive traffic are generally formulated and managed at the federal level, it is understandable that the State SIP submission would include summary data rather than a more elaborate discussion of underlying data. Ecology did include an extensive explanation of the underlying data for the predominant source categories, such as residential wood combustion, which comprises 74% of the winter time inventory. By contrast, emissions from all nonroad vehicles and engines, including railroad locomotives, account for only 5% of wintertime inventory. Moreover, although Ecology included only summary results for railroad emissions, it clearly referenced the documentation used in calculating the final railroad diesel emissions, listed as endnotes 26, 27, and 28 in the 2008 Baseline Emissions Inventory SIP submission. These documents were available from Ecology and the EPA during the comment period, and remain available for public review. Neither the EPA nor Ecology has received a request for these documents. For the convenience of the reader these background documents have been added to the docket for this action.

The comment only questions the level of detail in the discussion of the locomotive emission calculations and states that a comprehensive and accurate emissions inventory must provide figures of gallons of diesel consumed and emission factors or other calculations used in the emissions estimates. The availability of the additional detail requested by the comment is described above. Specifically, the emission factors were based on standard EPA emission factors for locomotives and fuel consumption data was provided by the rail freight carriers operating in the area. As the comment notes, these data are part of the comprehensive and accurate emissions inventory required by section 172(c)(3), and were appropriately relied upon by Ecology to calculate diesel emissions from locomotives. The EPA independently calculated the locomotive emissions estimates based on the information referenced in endnotes 26, 27, and 28 of the State's emissions inventory SIP submission, and obtained results that were consistent with the State's (see EPA review of emission calculations.xlsx ).

To the extent that the commenter raises issues related to future conformity determinations or potential coal export proposals that may impact the Tacoma-Pierce County nonattainment area in the future, or to the calculation of changes to the emission sources after 2008, the EPA has determined that these questions are beyond the scope of the 2008 Baseline Emissions Inventory and the requirements of section 172(c)(3).

The EPA has determined that Washington's SIP revisions, dated November 28, 2012, are consistent with sections 110 and 172 of the CAA. Therefore, we are approving the SIP revisions, specifically Appendix A, “2008 Baseline Emissions Inventory and Documentation” and Appendix B, “SIP Strengthening Rules.”

Under the Clean Air Act, the Administrator is required to approve a SIP submission that complies with the provisions of the Act 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 Clean Air Act. Accordingly, this action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this 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 Clean Air Act; 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).

The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this action and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register . A major rule cannot take effect until 60 days after it is published in the Federal Register . This action is not a “major rule” as defined by 5 U.S.C. 804(2).

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by July 29, 2013. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

40 CFR part 52 is amended as follows:

Table of Contents I. What action is EPA taking? II. What is the background for EPA's action? III. What is EPA's analysis of the RFP Plan for the Atlanta area for the 1997 8-Hour Ozone NAAQS? IV. What are the 2008 NO X and VOC emissions inventories for the Atlanta area? V. What is EPA's Analysis of the 2008 MVEB for the Atlanta Area? VI. What is the status of EPA's adequacy determination for the 2008 MVEB for the Atlanta area? VII. Final Action VIII. Statutory and Executive Order Reviews I. What action is EPA taking?

EPA is approving changes to the Georgia SIP, submitted by the State of Georgia through GA EPD, on October 21, 2009, to meet RFP  1 requirements of the Clean Air Act (CAA or Act) for the Atlanta Area for the 1997 8-hour ozone NAAQS. 2 The RFP plan demonstrates that NO X emissions will be reduced by at least 15 percent for the 13-County portion  3 of the Atlanta ozone nonattainment area (hereafter referred to as the “13-County Area”) and VOC emissions will be reduced by at least 15 percent for the seven-county portion  4 of the Atlanta ozone nonattainment area (hereafter referred to as the “7-County Area”) during the period of 2002 through 2008. Additionally, EPA is approving the required 2008 VOC MVEB and the 2008 NO X MVEB, which were included in the October 21, 2009, RFP plan for the Atlanta Area. EPA is taking these actions because they are consistent with CAA requirements for RFP. The MVEB for the Atlanta Area, expressed in tons per day (tpd), are provided in Table 1 below. EPA is also describing the status of its transportation conformity adequacy determination for the 2008 MVEB.

On July 18, 1997, EPA promulgated a revised 8-hour ozone NAAQS of 0.08 parts per million (ppm) (62 FR 38856). Under EPA's regulations at 40 CFR part 50, the 1997 8-hour ozone NAAQS is attained when the 3-year average of the annual fourth highest daily maximum 8- hour average ambient air quality ozone concentrations is less than or equal to 0.08 ppm (i.e., 0.084 ppm when rounding is considered). See 69 FR 23857, April 30, 2004. Ambient air quality monitoring data for the 3-year period must meet the data completeness requirement as determined in 40 CFR part 50, appendix I. The ambient air quality monitoring data completeness requirement is met when the average percent of days with valid ambient monitoring data is greater than 90 percent, and no single year has less than 75 percent data completeness.

Upon promulgation of a new or revised NAAQS, the CAA requires EPA to designate as nonattainment any area that is violating the NAAQS, based on the three most recent years of ambient air quality data at the conclusion of the designation process. The Atlanta Area was designated nonattainment for the 1997 8-hour ozone NAAQS on April 30, 2004 (effective June 15, 2004), using 2001-2003 ambient air quality data. See 69 FR 23857, April 30, 2004. The Atlanta Area encompasses the 13 counties of the former 1-hour ozone nonattainment area plus the seven additional “ring” counties. At the time of designation the Atlanta Area was classified as a marginal nonattainment area for the 1997 8-hour ozone NAAQS. In the April 30, 2004, Phase I Ozone Implementation Rule, EPA established ozone nonattainment area attainment dates based on Table 1 of section 181(a) of the CAA. This established an attainment date 3 years after the June 15, 2004, effective date for areas classified as marginal areas for the 1997 8-hour ozone nonattainment designations. Therefore, the Atlanta Area's original attainment date was June 15, 2007. See 69 FR 23951, April 30, 2004.

The Atlanta Area failed to attain the 1997 8-hour ozone NAAQS by June 15, 2007 (the applicable attainment date for marginal nonattainment areas), and did not qualify for any extension of the attainment date as a marginal area. As a consequence of this failure, on March 6, 2008, EPA published a rulemaking determining that the Atlanta Area failed to attain and, consistent with section 181(b)(2) of the CAA, the Atlanta Area was reclassified by operation of law to the next highest classification, or “moderate” nonattainment. See 73 FR 12013, March 6, 2008. When an area is reclassified, a new attainment date for the reclassified area must be established. Section 181 of the CAA explains that the attainment date for moderate nonattainment areas shall be as expeditiously as practicable, but no later than six years after designation, or June 15, 2010. EPA further required that Georgia submit SIP revisions to meet the new moderate area requirements as expeditiously as practicable, but no later than December 31, 2008.

Under certain circumstances, the CAA allows for extensions of the attainment dates prescribed at the time of the original nonattainment designation. In accordance with CAA section 181(a)(5), EPA may grant up to two, one-year extensions of the attainment date under specified conditions. On November 30, 2010, EPA determined that Georgia met the CAA requirements to obtain a one-year extension of the attainment date for the 1997 8-hour ozone NAAQS for the Atlanta Area. See 75 FR 73969. As a result, EPA extended the Atlanta Area's attainment date from June 15, 2010, to June 15, 2011, for the 1997 8-hour ozone NAAQS.

Subsequently, on June 23, 2011, EPA determined that the Atlanta Area attained the 1997 8-hour ozone NAAQS. See 76 FR 36873. The determination of attaining data was based upon quality-assured and certified ambient air monitoring data for the 2008-2010 period, showing that the Area had monitored attainment of the 1997 8-hour ozone NAAQS. As a result of the determination of attainment, the requirements for the Area to submit an attainment demonstration and associated reasonable available control measures (RACM), RFP plan, contingency measures, and other planning SIP revisions related to attainment of the 1997 8-hour ozone NAAQS were suspended. These nonattainment related SIP obligations remain suspended so long as the Area continues to attain the 1997 8-hour ozone NAAQS. See 40 CFR 52.582(d).

On February 16, 2012, Georgia withdrew the attainment demonstration submissions (except RFP, emissions statements, and the emissions inventory) as allowed by 40 CFR 51.918 for the Atlanta Area. 5 Subsequently, EPA approved Georgia's SIP revisions related to the emissions statements and emissions inventory requirements for the Atlanta Area for the 1997 8-hour ozone NAAQS. See 74 FR 62249 (November 27, 2009); and 77 FR 24399 (March 24, 2012), respectively. Despite the determination of attainment, Georgia opted to leave the SIP submission related to the RFP requirements for the 1997 8-hour ozone NAAQS before EPA for action. As such, EPA is taking action to approve Georgia's October 21, 2009, SIP revision as it relates to the RFP requirements for the 1997 8-hour ozone NAAQS.

Because Atlanta was classified as a “serious” nonattainment area under the 1-hour ozone NAAQS, Georgia was required to develop a SIP to reduce emissions of VOC in the 13-County Atlanta 1-hour ozone nonattainment area by 15 percent from 1990 to 1996. The plan, also known as Georgia's ROP plan SIP or the 15 Percent VOC Plan, was approved on April 26, 1999. See 64 FR 20186.

The CAA also requires post-1996 emission reductions of VOC and/or NO X totaling 3 percent per year, averaged over each consecutive three-year period beginning in 1996 and continuing through the attainment date. Georgia chose to rely solely on NO X emission reductions in its post-1996 ROP SIP (the 9 Percent Plan). This plan was required to describe how Georgia would achieve RFP towards attaining the 1-hour ozone NAAQS between 1996 and 1999, the attainment deadline for serious nonattainment areas. Georgia's 9 Percent Plan was approved on March 19, 1999. See 64 FR 13348.

On September 26, 2003, EPA re-classified the 13-county Atlanta 1-hour ozone nonattainment area to “severe.” See 68 FR 55469. Among other requirements, this reclassification required submission of a severe area post-1999 ROP SIP. A severe area post-1999 ROP SIP must describe how at least a 3 percent per year reduction in emissions of ozone precursors (VOC or NO X ) will be achieved, from the time of failure to meet the “serious” area attainment date until the “severe” area attainment date.

The Atlanta severe area post-1999 ROP SIP contained a description of how the 3 percent per year reductions in ozone precursor emissions, required over the period from November 15, 1999, through November 15, 2004, were achieved. It also contained MVEB for the Atlanta 1-hour ozone nonattainment area. GA EPD submitted the post-1999 ROP SIP and MVEB on December 24, 2003. EPA approved Georgia's post-1999 ROP SIP for the Atlanta Area on July 19, 2004 (69 FR 42880). EPA's approval of Georgia's post-1999 ROP SIP for the Atlanta Area completed the State's obligation related to ROP for the 1-hour ozone NAAQS.

On November 29, 2005 (70 FR 71612), as revised on June 8, 2007 (72 FR 31727), EPA published a rule entitled “Final Rule To Implement the 8-Hour Ozone National Ambient Air Quality Standard—Phase 2; Final Rule To Implement Certain Aspects of the 1990 Amendments Relating to New Source Review and Prevention of Significant Deterioration as They Apply in Carbon Monoxide, Particulate Matter and Ozone NAAQS; Final Rule for Reformulated Gasoline” (hereafter referred to as the Phase 2 Rule). Section 182(b)(1) of the CAA and EPA's Phase 2 Rule  6 require a state, for each 1997 8-hour ozone nonattainment area that is classified as moderate, to submit an emissions inventory and a RFP plan to show how the state will reduce emissions of VOC.

Specifically, in ozone nonattainment areas with air quality classified as “moderate” or worse, the RFP requirement prescribes emission reductions from the baseline totaling 15 percent within six years of the base year (i.e., by the end of 2008 for the 8-hour ozone NAAQS). Per 40 CFR part 51.910(a)(1)(iii), moderate and higher classification areas of which a portion has an approved 1-hour ozone 15 Percent VOC Plan can choose to treat the nonattainment area as two parts, each with a separate RFP target, and may substitute reductions in NO X for VOC in the sub-area with the approved 15 Percent Plan. The 15 percent reduction for the sub-area without an approved 1-hour ozone 15 Percent VOC Plan, however, must be achieved entirely through VOC reductions. Georgia relied solely on NO X emission reductions for the 13-County portion of the Atlanta Area with an approved 15 Percent VOC Plan.

Pursuant to CAA section 172(c)(9), RFP plans must include contingency measures that will take effect without further action by the State or EPA, which includes additional controls that would be implemented if the Area fails to reach the RFP milestones. While the CAA does not specify the type of measures or quantity of emissions reductions required, EPA provided guidance interpreting the CAA that implementation of these contingency measures would provide additional emissions reductions of up to 3 percent of the adjusted base year inventory in the year following the RFP milestone year (i.e., in this case 2008). For more information on contingency measures please see the April 16, 1992, General Preamble (57 FR 13498, 13510) and the November 29, 2005, Phase 2 8-hour ozone standard implementation rule (70 FR 71612, 71650). Finally, RFP plans must also include a MVEB for the precursors for which the plan is developed. See Section IV of this rulemaking for more information on MVEB requirements.

As mentioned above, the Atlanta Area was designated nonattainment for the 1997 8-hour ozone NAAQS. Specifically, 20 counties in the Atlanta Area (including the 13 counties that were included in the former 1-hour ozone nonattainment area) were classified as a “moderate” nonattainment area. Georgia submitted its RFP plan and additional SIP revision under a separate cover letter on October 21, 2009, including an attainment demonstration, associated RACM, RACT, contingency measures, a 2002 base year emissions inventory and other planning SIP revisions related to attainment of the 1997 8-hour ozone NAAQS in the Atlanta Area. Today's rulemaking is approving only the RFP plan, including the associated MVEB.

On October 21, 2009, Georgia submitted the RFP plan for the Atlanta Area to address the CAA's requirements for the 1997 8-hour ozone NAAQS. The Atlanta Area RFP is for the entire 20-County Area; however, GA EPD has chosen to look at the 13-County Area and 7-County Area separately for the purposes of calculating the RFP targets for NO X and VOC, respectively. Regardless of the separation of the 13-County Area and the 7-County Area, NO X and VOC reductions in the entire 20-County Area are available. Therefore, there are “unclaimed” 2008 NO X reductions available from the 7-County Area without an approved 1-hour ozone 15 Percent VOC Plan where RFP must be demonstrated in VOC reductions and there are “unclaimed” 2008 VOC reductions available from the 13-County Area for which there is an approved 1-hour ozone 15 Percent VOC Plan. EPA's analysis of Georgia's RFP submission is provided below.

An emissions inventory is a comprehensive, accurate, current inventory of actual emissions from all sources and is required by section 182(a)(1) of the CAA. Georgia implemented the 15 percent NO X reductions for the 13 counties in the former 1-hour ozone nonattainment area and the 15 percent VOC reduction for the seven ring counties between 2002 and 2008 with continued progress toward attainment through the attainment year. 7 EPA recommended 2002 as the base year for the emissions inventory, and therefore, 2002 is the starting point for calculating RFP. Georgia submitted its 2002 base year emissions inventory on October 21, 2009. In an action on March 24, 2012, EPA approved Georgia's 2002 base year emissions inventory for the Atlanta Area for the 1997 8-hour ozone NAAQS. See 77 FR 24399. A summary of the Atlanta Area 2002 base year emissions inventories is included in Table 2 below.

The process for determining the emissions baseline from which the RFP reductions are calculated is described in section 182(b)(1) of the CAA and 40 CFR 51.910. This baseline value is the 2002 adjusted base year inventory. Sections 182(b)(1)(B) and (D) require the exclusion from the base year inventory of emissions benefits resulting from the Federal Motor Vehicle Control Program (FMVCP) regulations promulgated prior to January 1, 1990, and the Reid Vapor Pressure (RVP) regulations promulgated prior to June 11, 1990. The FMVCP and RVP emissions reductions were determined by the State using EPA's on-road mobile source emissions modeling software, MOBILE6, which was the latest model at the time this submission was developed; 2002 speeds and vehicle miles traveled (VMT) from Atlanta Regional Commission's (ARC) travel demand model networks; and area-specific fleet age distributions. The FMVCP and RVP emission reductions are then removed from the base year inventory by the State, resulting in an adjusted base year inventory. The emission reductions needed to satisfy the RFP requirement are then calculated from the adjusted base year inventory. These reductions are then subtracted from the adjusted base year inventory to establish the emissions target for the RFP milestone year (2008).

For moderate areas like the Atlanta Area, the CAA specifies a 15 percent reduction in ozone precursor emissions over an initial six year period following the baseline inventory year. In the Phase 2 Rule, EPA interpreted this requirement for areas that were also designated nonattainment and classified as moderate or higher for the 1-hour ozone NAAQS. In the Phase 2 Rule, EPA provided that an area classified as moderate or higher that has the same boundaries as an area, or is entirely composed of several areas or portions of areas, for which EPA fully approved a 15 percent plan for the 1-hour NAAQS, is considered to have met the requirements of section 182(b)(1) of the CAA for the 8-hour NAAQS. In this situation, a moderate nonattainment area is subject to RFP under section 172(c)(2) of the CAA and shall submit, no later than 3 years after designation for the 8-hour NAAQS, a SIP revision that meets the requirements of 40 CFR 51.910(b)(2). For an area like Atlanta, the RFP SIP revision must provide for a 15 percent emission reduction (either NO X and/or VOC) accounting for any growth that occurs during the six year period following the baseline emissions inventory year, that is, 2002-2008.

The Atlanta Area that was classified as severe under the 1-hour ozone NAAQS contained the counties Cherokee, Clayton, Cobb, Coweta, DeKalb, Douglas, Fayette, Forsyth, Fulton, Gwinnett, Henry, Paulding, and Rockdale. These 13 counties plus 7 “ring” counties (Barrow, Bartow, Carroll, Hall, Newton, Spalding, and Walton) were also designated nonattainment as a part of the 1997 8-hour ozone Atlanta Area. Per 40 CFR part 51.910(a)(1)(iii), moderate areas of which a portion has an approved 1-hour ozone 15 Percent VOC Plan can choose to treat the nonattainment area as two parts, each with a separate RFP target, and may substitute reductions in NO X for VOC in the sub-area with the approved 15 Percent Plan. The 15 percent reduction for the sub-area without an approved 15 Percent VOC Plan must still be entirely VOC. Since a 15 percent ROP 8 plan was submitted for the 1-hour ozone Area, the 13-County 2002 base year NO X inventory was adjusted and the 7-County base year VOC inventory was adjusted.

As mentioned earlier and according to section 182(b)(1)(D) of the CAA, emission reductions that resulted from the FMVCP and RVP rules promulgated prior to 1990 are not creditable for achieving RFP emission reductions. Therefore, the 2002 base year inventory is adjusted by subtracting the VOC and NO X emission reductions that are expected to occur between 2002 and the future milestone years due to the FMVCP and RVP rules.

In the Phase 2 Rule, promulgated on November 29, 2005 (70 FR 71612), EPA outlines Method 1 as the process that states should use to show compliance with RFP for areas like the Atlanta Area that already have an approved ROP plan. A summary of the steps for Method 1 is provided below.

• Step A is the actual anthropogenic base year VOC emissions inventory in 2002.

• Step B is to account for creditable emissions for RFP.

• Step C is to calculate non-creditable emissions for RFP. Non-creditable emissions include emissions from: (1) motor vehicle exhaust or evaporative emissions regulations promulgated prior to January 1, 1990; (2) regulations concern RVP promulgated prior to November 15, 1990; (3) RACT corrections required prior to November 1990; and (4) corrective inspection and maintenance (I/M) plan required prior to November 1990. Step D is to subtract the non-creditable emissions (Step C) from the 2002 base year emissions (Step A).

• Step E is to calculate the 2008 target level VOC emissions. This is calculated by reducing the emissions from Step D by 15 percent.

• The estimated 2008 VOC emissions are then compared to the 2008 target level VOC emissions (Step E).

As provided in Georgia's RFP SIP revision, the State utilized the steps from Method 1 of the Phase 2 Rule. Specifically, Georgia's October 21, 2009, SIP revision sets out the State's calculations as summarized below.

1. Step A: Estimate the actual anthropogenic base year NO X inventory in 2002 with all 2002 control programs in place for all sources for the 13-County area and VOC inventory in 2002 with all 2002 control programs in place for all sources for the 7-County area.

Georgia provided this emission inventory in Tables 1 and 2 of the October 21, 2009, RFP plan for the Atlanta Area, and as shown in Tables 3 and 4, below. EPA has already approved this inventory. See 77 FR 24399 (April 4, 2012).

2. Step B: Using the same highway vehicle activity inputs used to calculate the actual 2002 inventory, run the appropriate motor vehicle emissions model for 2002 and for 2008 with all post-1990-CAA measures turned off. Any other local inputs for vehicle I/M programs should be set according to the program that was required to be in place in 1990. Fuel RVP should be set at 9.0 or 7.8 pounds per square inch (psi) depending on the RVP required in the local area as a result of fuel RVP regulations promulgated in June, 1990.

For the Atlanta Area, these adjustments are made because states are not allowed to take credit for emissions reductions that would have occurred due to fleet turnover from vehicles meeting pre-1990 standards to newer cars and trucks, or from previously existing federal fuel regulations. These non-creditable reductions are called the FMVCP/RVP reductions. See Appendix C, Exhibits 5 and 8, of the State submittal for details on the Adjusted Base Year Inventories.

3. Step C: Calculate the difference between the 2002 and 2008 VOC emission factors calculated in Step B and multiply by the 2002 vehicle miles traveled. The result is the VOC emission calculation that will occur between 2002 and 2008 without the benefits of any post-1990-CAA measures. These are the non-creditable reductions that occur over this period.

Georgia calculated the non-creditable emission reductions between 2002 and 2008 by modeling its 2002 and 2008 motor vehicle emissions with all post-1990 CAA measures turned off, and calculating the difference.

4. Step D: Subtract the non-creditable reductions calculated in Step C from the actual anthropogenic 2002 inventory estimated in Step A. These adjusted inventories are the basis for calculating the target level of emissions in 2008.

The adjusted VOC inventory for calculating the target level of VOC emissions reductions in the 7-County area for 2008 is 114.0 tpd  9 (i.e., 123.5 tpd (the result of Step A) minus 9.6 tpd (the result of Step C)).

The adjusted NO X inventory for calculating the target level of NO X emissions reductions in the 13-County area for 2008 is 519.0 tpd (i.e., 562.1 tpd the result of Step A) minus 43.1 tpd (the result of Step C)).

5. Step E: Reduce the adjusted inventories calculated in Step D by 15 percent. The result is the target level of emissions in 2008 in order to meet the 2008 RFP requirement. The actual projected 2008 inventory for all sources with all control measures in place, including projected 2008 growth in activity, must be at or lower than this target level of emissions.

The targeted level of emissions reductions for the Atlanta Area to meet RFP requirements is 17.1 tpd of VOC (i.e, 114.0 tpd multiplied by 15 percent) in the 7-County area. Thus the required targeted level of VOC emissions is 96.9 tpd for the 7-County area.

The targeted level of emissions reductions for the Atlanta Area to meet RFP requirements is 77.9 tpd of NO X (i.e, 519.0 tpd multiplied by 15 percent) in the 13-County area. Thus the required targeted level of NO X emissions is 441.2 tpd for the 13-County area.

As mentioned above, the required target level for the Atlanta Area to meet the initial RFP plan requirement is a 15 percent reduction in 2008 VOC emissions from the 7-County area and 15 percent reduction in 2008 NO X emissions from the 13-County area from the VOC and NO X emissions in 2002 (as adjusted per CAA requirements). Specifically, to meet this requirement, Georgia needed to demonstrate a reduction of at least 17.1 tpd VOC for the 7-County area and 77.9 tpd NO X for the 13-County area, respectively. Tables 5 and 6 below summarize the results of Georgia's calculations for this RFP analysis.

In its October 21, 2009, SIP revision, Georgia calculated the 2008 VOC and NO X emissions inventories for the Atlanta Area. These emissions inventories are provided in Table 7 below.

As discussed above, the required target for NO X reductions in the 13-County Area for the year 2008 to meet the RFP requirements for the Atlanta Area is 77.9 tpd (i.e., 15 percent reduction from the adjusted 2002 baseline). The projected 13-County 2008 NO X emissions of 450.7 tpd are above the 2008 13-County NO X Target Level Emissions of 441.2 tpd by 9.5 tpd. However, there are unclaimed 2008 NO X reductions totaling 126.0 tpd available from the 7-County Area without an approved 1-hour ozone 15 Percent VOC Plan where RFP must be in VOC reductions. By applying 9.5 tpd of those available 7-County NO X reductions towards 13-County RFP, the 13-County NO X target is met, with 116.5 available nonattainment area NO X tons per day reductions remaining. See Table 8.

The required target for VOC reductions in the 7-County area for the year 2008 to meet the RFP requirements for the Atlanta Area is 17.1 tpd (i.e., 15 percent reduction from the adjusted 2002 baseline). Although the projected 7-County 2008 VOC emissions of 109.8 tpd are above the 2008 7-County VOC Target Level Emissions of 96.9 tpd by 12.9 tpd, there are unclaimed 2008 VOC reductions totaling 74.6 tpd available from the 13-County Area for which there is an approved 1-hour ozone 15 Percent VOC Plan. By applying 12.9 tpd of those available 13-County VOC reductions towards 7-County RFP, the 7-County VOC target is met, with 61.7 available nonattainment area VOC tons per day reductions remaining. See Table 9.

You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

You may access a frequently updated electronic version of EPA's tolerance regulations at 40 CFR part 180 through the Government Printing Office's e-CFR site at http://www.ecfr.gov/cgi-bin/text-idx?&c=ecfr&tpl=/ecfrbrowse/Title40/40tab_02.tpl .

Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2011-0780 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before July 29, 2013. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2001-0780, by one of the following methods:

• Federal eRulemaking Portal: http://www.regulations.gov . Follow the online instructions for submitting comments. Do not submit electronically any information you consider to be CBI or other information whose disclosure is restricted by statute.

• Mail: OPP Docket, Environmental Protection Agency Docket Center (EPA/DC), (28221T), 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001.

• Hand Delivery: To make special arrangements for hand delivery or delivery of boxed information, please follow the instructions at http://www.epa.gov/dockets/contacts.htm . Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at http://www.epa.gov/dockets .

In the Federal Register of November 9, 2011 (76 FR 69690) (FRL-9325-1), EPA issued a document pursuant to FFDCA section 408(d)(3), 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide petition (PP 1E7911) by Summit Agro North America Holding Corporation, 600 Third Avenue, New York, NY 10016-2001. The petition requested that 40 CFR 180 be amended by establishing tolerances for residues of the fungicide triforine, piperazine-1,4-diylbis(2,2,2-trichloroethane-1,1-diyl)diformamide [also more commonly known as triforine, ( N,N´ -[1,2-piperazinediylbis(2,2,2-trichloroethylidene)]bis[formamide])], in or on blueberry and tomato at 0.02 and 0.5 parts per million (PPM), respectively. That document referenced a summary of the petition prepared by Landis International, Inc. on behalf of Summit Agro North America Holding Corporation, the registrant, which is available in the docket, http://www.regulations.gov . A comment was received on the notice of filing. EPA's response to this comment is discussed in Unit IV.C.

Based upon review of the data supporting the petition, EPA has revised the tolerance for blueberry from 0.02 ppm to 1.0 ppm. The reasons for this change are explained in Unit IV.D.

There are no registered food uses for triforine in the United States. These tolerances were requested in connection with use of triforine on tomatoes and blueberries grown overseas. These tolerances will allow blueberries and tomatoes containing triforine residues to be imported into the United States.

Section 408(b)(2)(A)(i) of FFDCA allows EPA to establish a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) of FFDCA requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue. . . .”

Consistent with FFDCA section 408(b)(2)(D), and the factors specified in FFDCA section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure for triforine including exposure resulting from the tolerances established by this action. EPA's assessment of exposures and risks associated with triforine follows.

EPA has evaluated the available toxicity data and considered its validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. The principal toxic effects of triforine are changes in the liver and hematopoietic system following repeated oral dosing, and the dog is the most sensitive species for the hematopoietic effects. Liver effects include increased liver weights, cholesterol and alkaline phosphatase levels. Toxicity was not observed in a rat 21-day dermal toxicity study at dose levels greater than the limit dose. Triforine is not acutely toxic via the oral, dermal, and inhalation routes. No developmental or reproductive toxicity was observed at doses below the limit dose. Triforine does not demonstrate neurotoxic or immunotoxic potential. Although the mouse study showed that triforine was associated with common tumors in the mouse, the EPA has determined that quantification of risk using a non-linear approach; i.e., reference dose (RfD), for triforine will adequately account for all chronic toxicity, including carcinogenicity, that could result from exposure to triforine. That conclusion is based on the following considerations: (1) No carcinogenic response was seen in either sex in an acceptable rat cancer study; (2) the tumors found in the mouse are commonly seen in the mouse; (3) both tumors types were found only at the high dose, which was above the limit dose (males 1204, females 1507 milligrams/kilogram (mg/kg/day)); (4) triforine is not mutagenic; (5) each tumor type was observed in one sex only; i.e., liver tumors in male mice and lung tumors in female mice.

Specific information on the studies received and the nature of the adverse effects caused by triforine as well as the no-observed-adverse-effect-level (NOAEL) and the lowest observed adverse effect level (LOAEL) from the toxicity studies can be found at http://www.regulations.gov in document Triforine. Human Health Risk Assessment to Support Petition for the Establishment of Permanent Tolerances without U.S. Registration for Blueberries and Tomatoes on pages 8 through 13 in docket ID number EPA-HQ-OPP-2011-0780.

Once a pesticide's toxicological profile is determined, EPA identifies toxicological points of departure (POD) and levels of concern to use in evaluating the risk posed by human exposure to the pesticide. For hazards that have a threshold below which there is no appreciable risk, the toxicological POD is used as the basis for derivation of reference values for risk assessment. PODs are developed based on a careful analysis of the doses in each toxicological study to determine the dose at which no adverse effects are observed (the NOAEL) and the lowest dose at which adverse effects of concern are identified (the LOAEL). Uncertainty/safety factors are used in conjunction with the POD to calculate a safe exposure level generally referred to as a population adjusted dose (PAD) or an RfD, and a safe margin of exposure (MOE). For non-threshold risks, the Agency assumes that any amount of exposure will lead to some degree of risk. Thus, the Agency estimates risk in terms of the probability of an occurrence of the adverse effect expected in a lifetime. For more information on the general principles EPA uses in risk characterization and a complete description of the risk assessment process, see http://www.epa.gov/pesticides/factsheets/riskassess.htm.

A summary of the toxicological endpoints for triforine used for human risk assessment is shown in the following Table.

1. Dietary exposure from food and feed uses. In evaluating dietary exposure to triforine, EPA considered exposure under the petitioned-for tolerances. EPA assessed dietary exposures from triforine in food as follows:

i. Acute exposure. Quantitative acute dietary exposure and risk assessments are performed for a food-use pesticide, if a toxicological study has indicated the possibility of an effect of concern occurring as a result of a 1-day or single exposure. No such effects were identified in the toxicological studies for triforine; therefore, a quantitative acute dietary exposure assessment was unnecessary.

ii. Chronic exposure. In conducting the chronic dietary exposure assessment EPA used the food consumption data from the Dietary Exposure Evaluation Model software with the Food Commodity Intake Database (DEEM-FCID) Version 3.16. This software uses 2003-2008 food consumption data from the U.S. Department of Agriculture's (USDA's) National Health and Nutrition Examination Survey, What We Eat in America, (NHANES/WWEIA). As to residues levels in food, EPA assumed tolerance level residues in the chronic dietary assessment for these raw agricultural commodities (RACs). A processing study for tomatoes was submitted that showed no concentration of triforine residues in tomato paste and puree; therefore the RAC tolerance was used and the concentration factor were set to a value of “1” for all processed tomato products, with the exception of dried tomatoes. Empirical data are not available for this processed commodity, so the DEEM 7.81 default processing factor for dried tomatoes of 14.3 was included in the dietary risk assessment. In addition, the dietary assessment assumes that 100% of the blueberry, tomato, and tomato processed commodities consumed in the U.S. are imported, and further that all of the imports have been treated with triforine, effectively assuming 100 percent crop treated (PCT) for the two crops that are included in the dietary risk assessment.

iii. Cancer. Based on the data summarized in Unit III.A., EPA has determined that although the mouse study showed that triforine was associated with common tumors in the mouse, quantification of risk using a non-linear approach for triforine would adequately account for all chronic effects, including potential carcinogenicity that could result from exposure to triforine.

iv. Anticipated residue and PCT information. EPA did not use anticipated residue and/or PCT information in the dietary assessment for triforine. Tolerance level residues and/or 100 PCT were assumed for all food commodities.

2. Dietary exposure from drinking water. Since this petition requests tolerances without U.S. registration, establishing the requested tolerances will have no impact on domestic drinking water. However, for the purpose of this risk assessment, the most recent drinking water assessment dated March 5, 2008, which estimated residues resulting from the residential uses of triforine, was consulted. Along with the other risk assessments supporting this action, the drinking water assessment (DP 339605; K. Moore, 3/5/08) can be found in the triforine docket, EPA-HQ-OPP-2011-0780. Modeled estimated drinking water concentrations from those uses are included in this risk assessment. Surface water estimated drinking water concentrations (EDWCs) are based on first index reservoir screening tool (FIRST) modeling and represent untreated surface water concentrations. For surface water, the modeled EDWC for annual average exposure was 0.84 parts per billion (PPB). The one-in-10-year annual average concentration is used for chronic exposure assessments. Groundwater EDWCs are based on Screening Concentration in Ground Water (SCIGROW) modeling and represent the concentration that might be expected in shallow unconfined aquifers under sandy soils. For groundwater, the average exposure estimate is 0.43 ppb. The drinking water models and their descriptions are available at the EPA Internet site: http://www.epa.gov/oppefed1/models/water/ . The highest annual average EDWC from the surface water model of 0.84 ppb was included in the chronic dietary risk assessment.

3. From non-dietary exposure. The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure (e.g., for lawn and garden pest control, indoor pest control, termiticides, and flea and tick control on pets). Triforine is currently registered for the following uses that could result in residential exposures: ornamentals including roses, trees, herbaceous plants, and woody shrubs and vines. There are no new residential uses with this petition; however, in order to complete the aggregate risk assessment, the Agency updated the residential exposure assessment. Because triforine does not pose a hazard by the dermal route of exposure, the residential handler assessment includes only inhalation exposure. The residential handler exposure assessment does not identify any residential handler risk concerns, in spite of representing worst case inhalation exposures. For post-application exposures, although a quantitative residential post-application exposure assessment was not performed, the Agency concluded that there is no concern for post-application exposures to triforine for the following reasons:

i. Since no dermal endpoints of concern were identified, there is also no concern for post-application dermal exposures.

ii. While the mouthing behaviors of children are also commonly addressed in post-application assessments, the Agency does not expect, based on the primary use pattern of triforine to control diseases on roses and other ornamental plants, children to routinely contact treated plants and engage in mouthing behaviors.

iii. Triforine is relatively non-volatile which, coupled with the dilution expected outdoors and the small amounts of active ingredient used diminish the possibility of post-application inhalation exposure. Moreover, the residential handler inhalation exposure assessment, which represents worst case inhalation exposures, and is considered protective of most post-application inhalation exposure scenarios. Further information regarding EPA standard assumptions and generic inputs for residential exposures may be found at http://www.epa.gov/pesticides/science/residential-exposure-sop.html .

4. Cumulative effects from substances with a common mechanism of toxicity. Section 408(b)(2)(D)(v) of FFDCA requires that, when considering whether to establish, modify, or revoke a tolerance, the Agency consider “available information” concerning the cumulative effects of a particular pesticide's residues and “other substances that have a common mechanism of toxicity.”

EPA has not found triforine to share a common mechanism of toxicity with any other substances, and triforine does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that triforine does not have a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see EPA's Web site at http://www.epa.gov/pesticides/cumulative .

1. In general. Section 408(b)(2)(C) of FFDCA provides that EPA shall apply an additional tenfold (10X) margin of safety for infants and children in the case of threshold effects to account for prenatal and postnatal toxicity and the completeness of the database on toxicity and exposure unless EPA determines based on reliable data that a different margin of safety will be safe for infants and children. This additional margin of safety is commonly referred to as the FQPA Safety Factor (SF). In applying this provision, EPA either retains the default value of 10X, or uses a different additional safety factor when reliable data available to EPA support the choice of a different factor.

2. Prenatal and postnatal sensitivity. There is no evidence of increased susceptibility following in utero exposure to triforine in either the rat or rabbit developmental toxicity study at dose levels up to the limit dose, and there is no evidence of increased susceptibility following in utero and/or pre-/post-natal exposure in the 2-generation reproduction study in rats at any dose levels, even those greater than the limit dose.

Triforine has been evaluated for potential developmental effects in the rat and rabbit (gavage administration). Maternal toxicity included decreased body weight and food consumption in rabbits at the limit dose, and maternal toxicity was not observed in rats at dose levels up to the limit dose. Decreased fetal body weight was observed in the rabbit at the limit dose, whereas there were no developmental effects in the rat at the limit dose (actual 840 mg/kg/day). Decreased fertility index and decreased testes weight was observed in F1 males in the 2-generation reproduction study only at a dose level greater than the limit dose.

3. Conclusion. EPA has determined that reliable data show the safety of infants and children would be adequately protected if the FQPA SF were reduced to 1X. That decision is based on the following findings:

i. The toxicity database for triforine is complete.

ii. There is no indication that triforine is a neurotoxic chemical and there is no need for a developmental neurotoxicity study or additional UFs to account for neurotoxicity.

iii. As indicated in Unit III.D.2., there is no evidence that triforine results in increased susceptibility in in utero rats or rabbits in the prenatal developmental studies or in young rats in the 2-generation reproduction study.

iv. There are no residual uncertainties identified in the exposure databases. The dietary food exposure assessments were performed based on 100 PCT and tolerance-level residues. EPA made conservative (protective) assumptions in the ground and surface water modeling used to assess exposure to triforine in drinking water. No risk is expected from the dermal route of exposure for children's postapplication exposure. Because of the use pattern, no incidental oral exposure is expected for children and no quantitative exposure assessment was conducted. These assessments will not underestimate the exposure and risks posed by triforine.

EPA determines whether acute and chronic dietary pesticide exposures are safe by comparing aggregate exposure estimates to the aPAD and cPAD. For linear cancer risks, EPA calculates the lifetime probability of acquiring cancer given the estimated aggregate exposure. Short-term, intermediate-term, and chronic-term risks are evaluated by comparing the estimated aggregate food, water, and residential exposure to the appropriate PODs to ensure that an adequate MOE exists.

1. Acute risk. An acute aggregate risk assessment takes into account acute exposure estimates from dietary consumption of food and drinking water. No adverse effect resulting from a single oral exposure was identified and no acute dietary endpoint was selected. Therefore, triforine is not expected to pose an acute risk.

2. Chronic risk. Using the exposure assumptions described in this unit for chronic exposure, EPA has concluded that chronic exposure to triforine from food and water will utilize <1% of the cPAD for the general U.S. population and all population subgroups. Based on the explanation in Unit III.C.3., regarding residential use patterns, chronic residential exposure to residues of triforine is not expected; therefore the chronic aggregate risk includes food and drinking water only.

3. Short-term risk. Short-term aggregate exposure takes into account short-term residential exposure plus chronic exposure to food and water (considered to be a background exposure level). Triforine is currently registered for uses that could result in short-term residential exposure, and the Agency has determined that it is appropriate to aggregate chronic exposure through food and water with short-term residential exposures to triforine. The Agency conducted short-term aggregate risk assessments only for adult males and adult females since there are no short-term residential exposures for children. There are no oral residential exposures for adults and triforine does not pose a dermal hazard, so only residential inhalation exposure is included in the aggregate assessment. Using the exposure assumptions described in this unit for short-term exposures, EPA has concluded the combined short-term food, water, and residential inhalation exposures result in aggregate MOEs of 46,000. Because EPA's level of concern for triforine is a MOE of 100 or below, these MOEs are not of concern.

4. Intermediate-term risk. Residential intermediate-term exposure is not anticipated; therefore an intermediate-term aggregate risk assessment is not necessary.

5. Aggregate cancer risk for U.S. population. As discussed in Unit III.A., EPA has determined that quantification of risk using a non-linear approach for triforine will be protective of all chronic effects including potential carcinogenicity. There are no chronic aggregate risks of concern and, therefore, there are no cancer aggregate risks of concern.

6. Determination of safety. Based on these risk assessments, EPA concludes that there is a reasonable certainty that no harm will result to the general population, or to infants and children from aggregate exposure to triforine residues.

Adequate enforcement methodology (gas chromatography with electron capture detection) is available to enforce the tolerance expression.

In making its tolerance decisions, EPA seeks to harmonize U.S. tolerances with international standards whenever possible, consistent with U.S. food safety standards and agricultural practices. EPA considers the international maximum residue limits (MRLs) established by the Codex Alimentarius Commission (Codex), as required by FFDCA section 408(b)(4). The Codex Alimentarius is a joint United Nations Food and Agriculture Organization/World Health Organization food standards program, and it is recognized as an international food safety standards-setting organization in trade agreements to which the United States is a party. EPA may establish a tolerance that is different from a Codex MRL; however, FFDCA section 408(b)(4) requires that EPA explain the reasons for departing from the Codex level. The Codex has established MRLs for triforine in or on blueberry and tomato at 1.0 and 0.5 ppm, respectively. These MRLs are the same as the tolerances being established for triforine in the United States.

One comment was received in response to the notice filing. The commenter asked the Agency to deny the petition stating that * * * “toxic effects to red blood cells and iron deposition in the wrong places is enough reason to deny this product.” The comment also requested that all studies be verified by an independent lab. The Agency responds to this comment by stating that all toxicity studies required in accordance with new 40 CFR part 158 data requirements have been submitted. The studies available for consideration of triforine toxicity provide a comprehensive and complete database. The Agency has conducted a human health risk assessment with this database and has concluded that there are no risks of concern to human health from the requested use of triforine as demonstrated by the risk assessment. Only dietary exposure is expected for the establishment of a tolerance on imported blueberries and tomatoes and adequate studies are available for consideration of this potential exposure scenario. All studies conducted on pesticide products to support applications for research or marketing should follow the Good Laboratory Practice (GLP) standards as stipulated in 40 CFR part 160 under FIFRA. When a registrant utilizes the service of a laboratory to conduct a study, they must notify the laboratory that the study should be conducted in accordance with this part (§ 160.10). Every study that is submitted to the Agency must include a statement that the study was conducted in accordance with this part (§ 160.12). Submission of a false statement may for the basis for cancellations, suspension, etc. EPA may refuse to consider reliable any data from a study which was not conducted in accordance with this part (§ 160.17). The Agency's Office of Enforcement and Compliance (OECA) conducts inspections of laboratory facilities for the purpose of compliance review to determine that the GLP regulations of FIFRA are being observed. This compliance review includes inspection of all raw data records, specimens and other entities as needed as stipulated in this part (§ 160.15). The toxicity studies used to assess the potential risks associated with exposure to triforine were conducted in compliance with 40 CR part 160, and included submission of all raw data as well as required GLP compliance statements. Further, Agency scientists conducted a thorough and independent review of these data during the registration process. The Agency has no objection to the establishment of tolerances without U.S. registrations for residues of triforine in or on blueberry and tomato.

The tolerance level for blueberry being established by the EPA differs from that proposed in the tolerance petition submitted by Summit Agro North America Holding Corporation. The Agency determined that the tolerance level of 1.0 ppm instead of 0.02 ppm for blueberry is needed so as to harmonize with the established Codex Maximum Residue Limits (MRL). This tolerance level will allow for full harmonization of both the residue definition and the tolerance level between the United States and Codex.

Therefore, tolerances are established for residues of triforine, ( N,N ′-[1,2-piperazinediylbis(2,2,2-trichloroethylidene)]bis[formamide]), including its metabolites and degradates, in or on tomato and blueberry at 0.5 and 1.0 ppm, respectively.

This final rule establishes tolerances under FFDCA section 408(d) in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled “Regulatory Planning and Review” (58 FR 51735, October 4, 1993). Because this final rule has been exempted from review under Executive Order 12866, this final rule is not subject to Executive Order 13211, entitled “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) or Executive Order 13045, entitled “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997). This final rule does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA) (44 U.S.C. 3501 et seq. ), nor does it require any special considerations under Executive Order 12898, entitled “Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations” (59 FR 7629, February 16, 1994).

Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. ), do not apply.

This final rule directly regulates growers, food processors, food handlers, and food retailers, not States or tribes, nor does this action alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of FFDCA section 408(n)(4). As such, the Agency has determined that this action will not have a substantial direct effect on States or tribal governments, on the relationship between the national government and the States or tribal governments, or on the distribution of power and responsibilities among the various levels of government or between the Federal Government and Indian tribes. Thus, the Agency has determined that Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999) and Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 9, 2000) do not apply to this final rule. In addition, this final rule does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) (2 U.S.C. 1501 et seq. ).

This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA) (15 U.S.C. 272 note).

Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq. ), EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register . This action is not a “major rule” as defined by 5 U.S.C. 804(2).

Therefore, 40 CFR chapter I is amended as follows:

I. General Information A. Does this action apply to me?

You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

You may access a frequently updated electronic version of 40 CFR part 180 through the Government Printing Office's e-CFR site at http://ecfr.gpoaccess.gov/cgi/t/text/text-idx?&c=ecfr&tpl=/ecfrbrowse/Title40/40tab_02.tpl.

Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2012-0558 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before July 29, 2013. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2012-0558, by one of the following methods:

• Federal eRulemaking Portal: http://www.regulations.gov. Follow the online instructions for submitting comments. Do not submit electronically any information you consider to be CBI or other information whose disclosure is restricted by statute.

• Mail: OPP Docket, Environmental Protection Agency Docket Center (EPA/DC), (28221T), 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001.

• Hand Delivery: To make special arrangements for hand delivery or delivery of boxed information, please follow the instructions at http://www.epa.gov/dockets/contacts.htm.

In the Federal Register of September 28, 2012 (77 FR 59581) (FRL-9364-6), EPA issued a notice pursuant to FFDCA section 408, 21 U.S.C. 346a, announcing the filing of a pesticide petition (PP 2E8017) by SciReg. Inc., 12733 Director's Loop, Woodbridge, VA 22192 on behalf of Rhodia Inc. The petition requested that 40 CFR 180.920 be amended by establishing an exemption from the requirement of a tolerance for residues of guar hydroxypropyl­trimethylammonium chloride (CAS No. 71329-50-5) when used as an inert ingredient (thickener/drift reduction agent) in pesticide formulations applied to growing crops under 40 CFR 180.920. That notice referenced a summary of the petition prepared by Rhodia, Inc. the petitioner, which is available in the docket, http://www.regulations.gov. Comments were received on the notice of filing. EPA's response to these comments is discussed in Unit V.C.

Inert ingredients are all ingredients that are not active ingredients as defined in 40 CFR 153.125 and include, but are not limited to, the following types of ingredients (except when they have a pesticidal efficacy of their own): Solvents such as alcohols and hydrocarbons; surfactants such as polyoxyethylene polymers and fatty acids; carriers such as clay and diatomaceous earth; thickeners such as carrageenan and modified cellulose; wetting, spreading, and dispersing agents; propellants in aerosol dispensers; microencapsulating agents; and emulsifiers. The term “inert” is not intended to imply nontoxicity; the ingredient may or may not be chemically active. Nevertheless, in most instances, EPA generally exempts inert ingredients from the requirement of a tolerance based on the low toxicity of the individual inert ingredients.

Section 408(c)(2)(A)(i) of FFDCA allows EPA to establish an exemption from the requirement for a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) of FFDCA requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue . . . .”

EPA establishes exemptions from the requirement of a tolerance only in those cases where it can be clearly demonstrated that the risks from aggregate exposure to pesticide chemical residues under reasonably foreseeable circumstances will pose no appreciable risks to human health. In order to determine the risks from aggregate exposure to pesticide inert ingredients, the Agency considers the toxicity of the inert in conjunction with possible exposure to residues of the inert ingredient through food, drinking water, and through other exposures that occur as a result of pesticide use in residential settings. If EPA is able to determine that a finite tolerance is not necessary to ensure that there is a reasonable certainty that no harm will result from aggregate exposure to the inert ingredient, an exemption from the requirement of a tolerance may be established.

Consistent with FFDCA section 408(c)(2)(A), and the factors specified in FFDCA section 408(c)(2)(B), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure for guar hydroxypropyltrimethylammonium chloride including exposure resulting from the exemption established by this action. EPA's assessment of exposures and risks associated with guar hydroxypropyltrimethylammonium chloride follows.

EPA has evaluated the available toxicity data and considered their validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. Specific information on the studies received and the nature of the adverse effects caused by guar hydroxypropyltrimethylammonium chloride as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies are discussed in this unit.

Acute toxicity studies and mutagenicity studies were conducted with guar hydroxypropyltrimethylammonium chloride. However, guar hydroxypropyltrimethylammonium chloride has the same basic molecular structure (a high molecular weight polysaccarhide backbone) as guar gum, and other slightly modified forms of guar gum. Based on common molecular structure of guar hydroxypropyltrimethylammonium chloride with guar gum, hydroxyproplyl guar, carboxymethyl guar and carboxymethyl hydroxylpropyl guar, it is expected that these substances would share chemical and toxicological properties.

Guar hydroxypropyltrimethylammonium chloride has a low toxicity profile. The acute oral LD 50 (lethal dose) is greater than 2,000 milligrams/kilogram (mg/kg). No dermal irritation, dermal sensitization, or mutagenicity was observed. Eye irritation was mild to none. Since no subchronic, reproductive and developmental, and carcinogenicity studies are available for guar hydroxypropyltrimethylammonium chloride, EPA relied on studies conducted on the structurally similar compounds guar gum, hydroxypropyl guar, and carboxymethyl guar, and carboxymethyl-hydroxypropyl guar. Subchronic, reproductive and developmental, and carcinogenicity studies with guar gum showed no long-term, reproductive/developmental toxicity or carcinogenic effects. Also teratogenicity studies with guar gum in mice, rats, and hamsters did not indicate that guar gum is a teratogen, up to levels of 800 mg/kg/day, 900 mg/kg/day, and 600 mg/kg/day, respectively. In addition, no effects on parental fertility, fetal development, sex distribution, and no malformations of the pups were observed at doses up to 7,500 mg/kg/day in the one-generation reproduction study in rats. No evidence of immunotoxicity (spleen, thymus, blood) was observed in the available toxicity studies on structurally related chemicals. Furthermore, no clinical signs of neurotoxicity were observed at very high doses in the available database for structurally similar compounds.

Based on these data, EPA concludes that guar hydroxypropyltrimethylammonium chloride has a low toxicity profile. These findings are supported by what would be expected based on the physical characteristics of the substance. As a cationic form of guar, guar hydroxypropyltrimethylammonium chloride would be expected to be a dermal and eye irritant. Its high molecular weight as a polysaccharide polymer limits its ability to be absorbed through the skin, lungs, or gastrointestinal tract; therefore, guar hydroxypropyltrimethylammonium chloride is of low concern for acute and chronic effects, reproductive/developmental toxicity, immunotoxic, neurotoxic, and carcinogenic effects.

The majority of the available studies suggest that high levels of guars were well tolerated by laboratory animals. Although there were two studies that showed some effects, they appear to be outliers since those results were not replicated in the longer-term studies. In the two 90-day toxicity studies, the body weight gain appears to be depressed at 500 mg/kg/day dose levels and above. However, generally the food consumption was not affected. In a third 90-day toxicity study in rats, no effect on body weight was observed at doses up to 3,000 mg/kg/day. No effect on the body weights were observed in the reproduction study in rats at doses up to 7,500 mg/kg/day. In the carcinogenicity studies in mice and rats by the National Toxicology Program (NTP) (1982), no adverse effects were observed at doses up to 3,570 mg/kg/day. Based on their large molecular weights, these two chemicals are not expected to be significantly absorbed via oral, dermal and inhalation routes of exposure. This is further supported by the animal toxicity studies where no significant effects were observed in a carcinogenicity studies in mice and rats and reproduction study in rats at doses up to and including 3,500 mg/kg/day. Based on the above weight of evidence, no endpoint of concern was identified; therefore, it is not appropriate to conduct a quantitative assessment.

1. Dietary exposure from food and feed uses, drinking water, and non-dietary exposure.

Exposure to guar hydroxypropyltrimethylammonium chloride through food, water and non-dietary sources are likely to occur. However, a quantitative exposure assessment was not conducted because no endpoint of concern (hazard) was identified in the available database.

2. Cumulative effects from substances with a common mechanism of toxicity. Section 408(b)(2)(D)(v) of FFDCA requires that, when considering whether to establish, modify, or revoke a tolerance, the Agency consider “available information” concerning the cumulative effects of a particular pesticide's residues and “other substances that have a common mechanism of toxicity.”

Results of toxicological studies conducted with guar hydroxypropyltrimethylammonium chloride demonstrate the substance is of low toxicity. In addition, guar hydroxypropyltrimethylammonium chloride is a slightly modified form of guar gum, a natural polymer which is an affirmed GRAS (generally recognized as safe) substance of low toxicity. Guar hydroxypropyltrimethylammonium chloride is also structurally similar to hydroxypropyl guar, carboxymethyl guar, and carboxymethyl-hydroxypropyl guar, other slightly modified forms of guar gum and all of which are exempt from the requirement of a tolerance. As part of its qualitative assessment of guar hydroxypropyltrimethylammonium chloride, EPA is not concerned about the potential for cumulative effects given the low toxicity of this substance and its structurally similar substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see EPA's Web site at http://www.epa.gov/pesticides/cumulative.

As part of its qualitative assessment, the Agency did not use safety factors for assessing risk, and no additional safety factor is needed for assessing risk to infants and children. Guar hydroxypropyltrimethylammonium chloride is a slightly modified form of guar gum, a natural polymer which is an affirmed GRAS substance of low toxicity. Guar hydroxypropyltrimethylammonium chloride is also structurally similar to hydroxypropyl guar, another slightly modified form guar gum. According to EPA's 2005 tolerance exemption reassessment document for hydroxypropyl guar, it was concluded that hydroxypropyl guar is a high molecular weight polymer that is devoid of reactive functional groups and which is not absorbed by any route of human exposure. Also teratogenicity studies with guar gum in mice, rats, and hamsters did not indicate that guar gum is a teratogen, up to levels of 800 mg/kg, 900 mg/kg, and 600 mg/kg, respectively. In addition, no effects on parental fertility, fetal development, sex distribution, and no malformations of the pups were observed at doses up to 7,500 mg/kg/day in the 1-generation reproduction study in rats. Based on the structural similarities to guar gum and hydroxypropyl guar, as well as its high molecular weights and low likelihood of absorption via any route of exposure, guar hydroxypropyltrimethylammonium chloride is unlikely to elicit a toxic response in infants and children when used as an inert ingredient in pesticide products. Available toxicity studies support this conclusion of low toxicity.

In examining aggregate exposure, EPA considers available information concerning exposures from the pesticide residue in food and all other nonoccupational exposures, including drinking water from ground water or surface water and exposure through pesticide use in gardens, lawns, or buildings (residential and other indoor uses). Based on results from toxicological studies, its close structural relationship to guar gum, hydroxypropyl guar, carboxymethyl guar, and carboxymethyl-hydroxypropyl guar, as well as its high molecular weight and low likelihood of absorption via any route of exposure, guar hydroxypropyltrimethylammonium chloride is considered to be a low toxicity substance. Taking into consideration all available information on guar hydroxypropyltrimethylammonium chloride, EPA has determined that there is a reasonable certainty that no harm to any population subgroup, including infants and children, will result from aggregate exposure to guar hydroxypropyltrimethylammonium chloride under reasonably foreseeable circumstances. Therefore, the establishment of an exemption from tolerance under 40 CFR 180.920 for residues of guar hydroxypropyltrimethylammonium chloride when used as an inert ingredient in pesticide formulations applied, is safe under FFDCA section 408.

An analytical method is not required for enforcement purposes since the Agency is establishing an exemption from the requirement of a tolerance without any numerical limitation.

In making its tolerance decisions, EPA seeks to harmonize U.S. tolerances with international standards whenever possible, consistent with U.S. food safety standards and agricultural practices. EPA considers the international maximum residue limits (MRLs) established by the Codex Alimentarius Commission (Codex), as required by FFDCA section 408(b)(4). The Codex Alimentarius is a joint United Nation Food and Agriculture Organization/World Health Organization food standards program, and it is recognized as an international food safety standards-setting organization in trade agreements to which the United States is a party. EPA may establish a tolerance that is different from a Codex MRL; however, FFDCA section 408(b)(4) requires that EPA explain the reasons for departing from the Codex level.

The Codex has not established a MRL for guar hydroxypropyltrimethylammonium chloride.

One comment was received for a notice of filing from a private citizen who opposed the authorization to sell any pesticide that leaves a residue on food. The Agency understands the commenter's concerns and recognizes that some individuals believe that no residue of pesticides should be allowed. However, under the existing legal framework provided by section 408 of the Federal Food, Drug, and Cosmetic Act (FFDCA), EPA is authorized to establish pesticide tolerances or exemptions where persons seeking such tolerances or exemptions have demonstrated that the pesticide meets the safety standard imposed by the statute.

Therefore, an exemption from the requirement of a tolerance is established under 40 CFR 180.920 for guar hydroxypropyltrimethylammonium chloride (CAS No. 71329-50-5) when used as an inert ingredient (thickener/drift reduction agent) in pesticide formulations applied to growing crops.

This final rule establishes a tolerance under FFDCA section 408(d) in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled “Regulatory Planning and Review” (58 FR 51735, October 4, 1993). Because this final rule has been exempted from review under Executive Order 12866, this final rule is not subject to Executive Order 13211, entitled “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) or Executive Order 13045, entitled “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997). This final rule does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA) (44 U.S.C. 3501 et seq. ), nor does it require any special considerations under Executive Order 12898, entitled “Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations” (59 FR 7629, February 16, 1994).

Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. ), do not apply.

This final rule directly regulates growers, food processors, food handlers, and food retailers, not States or tribes, nor does this action alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of FFDCA section 408(n)(4). As such, the Agency has determined that this action will not have a substantial direct effect on States or tribal governments, on the relationship between the national government and the States or tribal governments, or on the distribution of power and responsibilities among the various levels of government or between the Federal Government and Indian tribes. Thus, the Agency has determined that Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999) and Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 9, 2000) do not apply to this final rule. In addition, this final rule does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) (2 U.S.C. 1501 et seq. ).

This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA) (15 U.S.C. 272 note).

Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq. ), EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register . This action is not a “major rule” as defined by 5 U.S.C. 804(2).

Therefore, 40 CFR chapter I is amended as follows:

I. General Information A. Does this action apply to me?

You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

Under the Federal Food, Drug, and Cosmetic Act (FFDCA) section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this order and may also request a hearing on those objections. You must file your objection or request a hearing on this order in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2012- 0441 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before July 29, 2013. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2012-0441, by one of the following methods:

• Federal eRulemaking Portal: http://www.regulations.gov. Follow the online instructions for submitting comments. Do not submit electronically any information you consider to be CBI or other information whose disclosure is restricted by statute.

• Mail: OPP Docket, Environmental Protection Agency Docket Center (EPA/DC), (28221T), 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001.

• Hand Delivery: To make special arrangements for hand delivery or delivery of boxed information, please follow the instructions at http://www.epa.gov/dockets/contacts.htm. Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at http://www.epa.gov/dockets.

Pursuant to FFDCA section 408(f), EPA determined that additional data are reasonably required to support the continuation of the tolerances for difenzoquat which are codified at 40 CFR 180.369. In the Federal Register of December 19, 2012 (77 FR 75037) (FRL-9372-9), EPA issued a final data call-in order in follow-up to a proposed order which published in the Federal Register on July 6, 2012 (77 FR 39962) (FRL-9352-9). In the final data call-in order of December 19, 2012, EPA required the submission of various data to support the continuation of the tolerances for the pesticide difenzoquat. Because there are currently no domestic registrations for difenzoquat, these tolerances are referred to as “import tolerances.” According to the terms of the order, if the Agency did not receive a section 408(f) Response Form identifying a person who agrees to submit the required data within 90 days after publication of the final order (March 19, 2013), EPA would proceed to revoke the difenzoquat tolerances at 40 CFR 180.369.

Subsequent to the final data call-in order of December 19, 2012, EPA received no submissions of the “section 408(f) Order Response” form within the required 90-day period. Therefore, in this order, EPA is revoking all the tolerances for the pesticide difenzoquat in 40 CFR 180.369, which includes tolerances for the following commodities: Barley, bran; barley, grain; barley, straw; cattle, fat; cattle, meat; cattle, meat byproducts; goat, fat; goat, meat; goat, meat byproducts; hog, fat; hog, meat; hog, meat byproducts; horse, fat; horse, meat; horse, meat byproducts; poultry, fat; poultry, meat; poultry, meat byproducts; sheep, fat; sheep, meat; sheep, meat byproducts; wheat, bran; wheat, grain; wheat, shorts; and wheat, straw.

This tolerance revocation order for difenzoquat is subject to the objection and hearing procedure in FFDCA section 408(g)(2) but the only material issue in such a procedure is whether a submission required by the order was made in a timely fashion.

Under FFDCA section 408(f)(2), if a submission required by an order issued pursuant to section 408(f)(1) is not received by the date specified in that order, EPA may by order published in the Federal Register revoke the tolerance that is the subject of that order.

As stated in the DATES section, this order is effective on the date of publication in the Federal Register . An order issued under FFDCA section 408(f)(2) shall take effect upon publication unless the regulation or order specifies otherwise. However, the Agency may stay the effectiveness of the regulation or order if, after issuance of such regulation or order, objections are filed with respect to such regulation or order pursuant to FFDCA section 408(g)(2). (21 U.S.C. 346a(g)(1)).

Any commodities listed in the regulatory text of this document that are treated with the pesticides subject to this order, and that are in the channels of trade following the tolerance revocations, shall be subject to FFDCA section 408(1)(5), as established by the Food Quality Protection Act (FQPA). Under this unit, any residues of the pesticide in or on such food shall not render the food adulterated so long as it is shown to the satisfaction of the Food and Drug Administration that:

1. The residue is present as the result of an application or use of the pesticide at a time and in a manner that was lawful under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA).

2. The residue does not exceed the level that was authorized at the time of the application or use to be present on the food under a tolerance or exemption from tolerance. Evidence to show that food was lawfully treated may include records that verify the dates that the pesticide was applied to such food.

This action, which revokes tolerances due to a failure to comply with a data call-in order, is in the form of an order and not a rule. (21 U.S.C. 346a(f)(1)(C)). Under the Administrative Procedure Act (APA), orders are expressly excluded from the definition of a rule. (5 U.S.C. 551(4)). Accordingly, the regulatory assessment requirements imposed on a rulemaking do not apply to this action, as explained further in the following discussion.

Because this order is not a “regulatory action” as that term is defined in Executive Order 12866, entitled “ Regulatory Planning and Review ” (58 FR 51735, October 4, 1993), this action is not subject to review by the Office of Management and Budget (OMB) under Executive Orders 12866 and 13563, entitled “ Improving Regulation and Regulatory Review ” (76 FR 3821, January 21, 2011).

This action does not impose additional burdens that require approval by OMB under the Paperwork Reduction Act (PRA) (44 U.S.C. 3501 et seq. ). The information collection activities associated with the prior order requesting data from any party interested in supporting the tolerances being revoked today were approved by OMB under OMB Control No. 2070-0174, and are identified by EPA ICR No. 2288.01. Burden is defined at 5 CFR 1320.3(b). Under the PRA, an Agency may not conduct or sponsor, and a person is not required to respond to a collection of information that requires OMB approval under PRA, unless it has been approved by OMB and displays a currently valid OMB control number. The OMB control numbers for EPA's regulations in title 40 of the CFR, after appearing in the Federal Register , are listed in 40 CFR part 9, and included on the related collection instrument, or form, if applicable.

Since this order is not a rule under the APA (5 U.S.C. 551(4)), and does not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. ) do not apply.

This order directly regulates growers, food processors, food handlers, and food retailers, not States or tribes; nor does this action alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of section 408(n)(4) of FFDCA. As such, the Agency has determined that this action will not have a substantial direct effect on States or tribal governments, on the relationship between the national government and the States or tribal governments, or on the distribution of power and responsibilities among the various levels of government or between the Federal Government and Indian tribes. Thus the Agency has determined that Executive Order 13132, entitled “ Federalism ” (64 FR 43255, August 10, 1999), and Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 9, 2000), do not apply to this order. In addition, this order does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act (UMRA) (2 U.S.C. 1531-1538).

As indicated previously, this action is not a “regulatory action” as defined by Executive Order 12866. As a result, this action is not subject to Executive Order 13045, entitled “ Protection of Children from Environmental Health Risks and Safety Risks ” (62 FR 19885, April 23, 1997), and Executive Order 13211 entitled “ Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use ” (66 FR 28355, May 22, 2001). In addition, this order also does not require any special considerations under Executive Order 12898, entitled “ Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations ” (59 FR 7629, February 16, 1994).

This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act (NTTAA), (15 U.S.C. 272 note).

The Congressional Review Act, 5 U.S.C. 801 et seq., does not apply because this action is not a rule as that term is defined in 5 U.S.C. 804(3).

Therefore, 40 CFR chapter I is amended as follows:

I. General Information A. Does this action apply to me?

You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

You may access a frequently updated electronic version of 40 CFR part 180 through the Government Printing Office's e-CFR site at http://ecfr.gpoaccess.gov/cgi/t/text/text-idx?&c=ecfr&tpl=/ecfrbrowse/Title40/40tab_02.tpl.

Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2012-0461 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before July 29, 2013. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2012-0461, by one of the following methods:

• Federal eRulemaking Portal: http://www.regulations.gov. Follow the online instructions for submitting comments. Do not submit electronically any information you consider to be CBI or other information whose disclosure is restricted by statute.

• Mail: OPP Docket, Environmental Protection Agency Docket Center (EPA/DC), (28221T), 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001.

• Hand Delivery: To make special arrangements for hand delivery or delivery of boxed information, please follow the instructions at http://www.epa.gov/dockets/contacts.html.

Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at http://www.epa.gov/dockets.

In the Federal Register of August 22, 2012 (77 FR 50661) (FRL-9358-9), EPA issued a document pursuant to FFDCA section 408, 21 U.S.C. 346a, announcing the filing of a pesticide petition (PP 2E8010) by SciReg, Inc. (12733 Director's Loop, Woodbridge, VA 22192), on behalf of Rhodia Inc. (CN 7500, 8 Cedar Brook Drive, Cranbury, NJ 08512-7500). The petition requested that 40 CFR 180.910 be amended by establishing an exemption from the requirement of a tolerance for residues of methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate (1174627-68-9) when used as an inert ingredient (solvent) in pesticide formulations applied to growing crops or to raw agricultural commodities after harvest (40 CFR 180.910). That document referenced a summary of the petition prepared by SciReg, Inc. (12733 Director's Loop, Woodbridge, VA 22192), on behalf of Rhodia Inc. (CN 7500, 8 Cedar Brook Drive, Cranbury, NJ 08512-7500), the petitioner, which is available in the docket, http://www.regulations.gov. There were no comments received in response to the notice of filing.

Inert ingredients are all ingredients that are not active ingredients as defined in 40 CFR 153.125 and include, but are not limited to, the following types of ingredients (except when they have a pesticidal efficacy of their own): Solvents such as alcohols, and hydrocarbons; surfactants such as polyoxyethylene polymers, and fatty acids; carriers such as clay, and diatomaceous earth; thickeners such as carrageenan, and modified cellulose; wetting, spreading, and dispersing agents; propellants in aerosol dispensers; microencapsulating agents, and emulsifiers. The term “inert” is not intended to imply nontoxicity, the ingredient may or may not be chemically active. Generally, EPA has exempted inert ingredients from the requirement of a tolerance based on the low toxicity of the individual inert ingredients.

Section 408(c)(2)(A)(i) of FFDCA allows EPA to establish an exemption from the requirement for a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) of FFDCA requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue . . . .”

EPA establishes exemptions from the requirement of a tolerance only in those cases where it can be clearly demonstrated that the risks from aggregate exposure to pesticide chemical residues under reasonably foreseeable circumstances will pose no appreciable risks to human health. In order to determine the risks from aggregate exposure to pesticide inert ingredients, the Agency considers the toxicity of the inert in conjunction with possible exposure to residues of the inert ingredient through food, drinking water, and through other exposures that occur as a result of pesticide use in residential settings. If EPA is able to determine that a finite tolerance is not necessary to ensure that there is a reasonable certainty that no harm will result from aggregate exposure to the inert ingredient, an exemption from the requirement of a tolerance may be established.

Consistent with FFDCA section 408(c)(2)(A), and the factors specified in FFDCA section 408(c)(2)(B), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of, and to make a determination on aggregate exposure for methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate, including exposure resulting from the exemption established by this action. EPA's assessment of exposures and risks associated with methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate follows.

EPA has evaluated the available toxicity data and considered their validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. Specific information on the studies received and the nature of the adverse effects caused by methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies are discussed in this unit.

Methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate is not acutely toxic via the oral or dermal routes of exposure. It is not a primary eye irritant, a primary skin irritant, or a dermal sensitizer. A repeat dose reproduction/developmental toxicity study showed no treatment-related effects on mating or fertility. There were no treatment-related effects on gestation, litter size, litter growth, and development as compared to controls. There was no evidence of any toxicity in the parameters evaluated in this study. The NOAEL for systemic toxicity was considered to be 1,000 milligram/kilograms body weight/day (mg/kg bw/day), the highest dose tested; a LOAEL was not observed in this study. A Bacterial Reverse Mutation Assay with Salmonella typhimurium concluded methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate did not induce mutagenic activity. A Gene Mutation Assay with Chinese hamster cells showed no reproducible dose-dependent increase in gene mutation frequency. A Chromosome Aberration Test with Human Lymphocytes in vitro showed no signs of cells carrying structural chromosomal aberrations. There was no evidence of an increase in polyploidy metaphases after treatment with methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate. A Mammalian Erythrocyte Micronucleus Test with mice revealed no statistically significant decreases in the PCE/NCE ratio therefore, methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate, is considered to be negative for genotoxicity. Methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate, is considered non-mutagenic, there are no known data that directly suggest that methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate is carcinogenic. Based on the absence any toxicity at the limit dose, lack of mutagenicity concerns, and lack of carcinogenicity triggers in the Derek analysis, EPA concluded that methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate is unlikely to pose a cancer risk at anticipated human exposures. Neurotoxicity was not observed in a reproduction/developmental toxicity screening study in rats, where neurotoxic parameters were evaluated. Immunotoxicity studies were not available for review. However, signs of immunotoxicity were not observed in any of the submitted studies.

The available toxicity studies indicate that methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate has a very low overall toxicity. The NOAEL is 1,000 mg/kg bw/day (limit dose). Since signs of toxicity were not observed at the limit dose, an endpoint of concern for risk assessment purposes was not identified. Therefore, since no endpoint of concern was identified for the acute, and chronic dietary exposure assessments, and short-, and intermediate-term dermal, and inhalation exposure assessments, a quantitative risk assessment for methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate is not necessary.

1. Dietary exposure from food and feed uses. In evaluating dietary exposure to methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate, EPA considered exposure under the proposed exemption from the requirement of a tolerance. EPA assessed dietary exposures from methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate in food as follows: Dietary exposure to methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate can occur from eating food treated with pesticide formulations containing this inert ingredient. In addition, food can pick up residues of methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate that has been used in pesticide formulations applied to treat food contact surfaces, thus resulting in indirect exposure. However, since an endpoint of concern for risk assessment was not identified, a quantitative dietary exposure assessment for methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate was not conducted.

2. Dietary exposure from drinking water. Dietary exposure from drinking water to methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate can occur by drinking water that has been contaminated by run-off from a pesticide treated area, and from antimicrobial formulations used in food-contact surface sanitizing solutions. Since an endpoint for risk assessment was not identified, a quantitative dietary exposure assessment from drinking water for methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate was not conducted.

3. From non-dietary exposure. The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure ( e.g., textiles (clothing and diapers), carpets, swimming pools, and hard surface disinfection on walls, floors, tables).

Methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate may be used in inert ingredients in pesticide products that are registered for specific uses that may result in both indoor and outdoor residential exposures. However, since there are no toxicological effects of concern occurring below the limit dose of 1,000 mg/kg bw/day, it is not necessary to conduct quantitative assessments of residential (non-occupational) exposures and risks. There are no dermal or inhalation toxicological endpoints of concern to the Agency, therefore, quantitative assessments have not been conducted.

4. Cumulative effects from substances with a common mechanism of toxicity. Section 408(b)(2)(D)(v) of FFDCA requires that, when considering whether to establish, modify, or revoke a tolerance, the Agency consider “available information” concerning the cumulative effects of a particular pesticide's residues and “other substances that have a common mechanism of toxicity.”

EPA has not found methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate to share a common mechanism of toxicity with any other substances, and methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate does not have a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see EPA's Web site at http://www.epa.gov/pesticides/cumulative.

1. In general. Section 408(b)(2)(c) of FFDCA provides that EPA shall apply an additional tenfold (10X) margin of safety for infants and children in the case of threshold effects to account for prenatal and postnatal toxicity, and the completeness of the database on toxicity and exposure, unless EPA determines, based on reliable data that a different margin of safety will be safe for infants and children. This additional margin of safety is commonly referred to as the Food Quality Protection Act (FQPA) safety factor. In applying this provision, EPA either retains the default value of 10X, or uses a different additional safety factor when reliable data available to EPA support the choice of a different factor.

2. Prenatal and postnatal sensitivity. There is no evidence of qualitative or quantitative susceptibility of infants and children in the available database.

3. Conclusion. As part of its qualitative assessment, the Agency did not use safety factors for assessing risk, and no additional safety factor is needed for assessing risk to infants and children. The available toxicity studies suggest low toxicity of methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate. The toxicity database for methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate contains acute oral, dermal and inhalation toxicity studies; skin, eye, and sensitization studies; mutagenicity studies (gene mutation, chromosomal aberrations assay), including in vivo micronucleus assay; and reproduction/developmental toxicity screening study in the rat. There is no indication based upon the available data that methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate is a neurotoxic or immunotoxic chemical, or results in increased qualitative or quantitative susceptibility in infants or children. Based on this information, there is no concern, at this time, for increased sensitivity to infants and children to this chemical when used as inert ingredient in pesticides formulations.

Taking into consideration all available information on methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate, EPA has determined that there is a reasonable certainty that no harm to any population subgroup will result from aggregate exposure to methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate under reasonably foreseeable circumstances. Therefore, the establishment of an exemption from tolerance under 40 CFR 180.910 for residues of methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate when used as an inert ingredient, specifically as a solvent, in pesticide formulations applied to growing crops and to raw agricultural commodities after harvest, is safe under FFDCA section 408.

1. Aggregate cancer risk for U.S. population. For the reasons stated in Unit IV.A. methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate is not expected to pose a cancer risk to humans.

2. Determination of safety. Based on these risk assessments, EPA concludes that there is a reasonable certainty that no harm will result to the general population, or to infants and children, from aggregate exposure to methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate residues when used as an inert ingredient in pesticide formulations under 40 CFR 180.910.

An analytical method is not required for enforcement purposes since the Agency is establishing an exemption from the requirement of a tolerance without any numerical limitation.

In making its tolerance decisions, EPA seeks to harmonize U.S. tolerances with international standards whenever possible, consistent with U.S. food safety standards and agricultural practices. EPA considers the international maximum residue limits (MRLs) established by the Codex Alimentarius Commission (Codex), as required by FFDCA section 408(b)(4). The Codex Alimentarius is a joint United Nation Food and Agriculture Organization/World Health Organization food standards program, and it is recognized as an international food safety standards-setting organization in trade agreements to which the United States is a party. EPA may establish a tolerance that is different from a Codex MRL; however, FFDCA section 408(b)(4) requires that EPA explain the reasons for departing from the Codex level.

The Codex has not established a MRL for Methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate.

Therefore, an exemption from the requirement of a tolerance is established under 40 CFR 180.910 for methyl 5-(dimethylamino)-2-methyl-5-oxopentanoate. (1174627-68-9) when used as an inert ingredient (solvent) in pesticide formulations applied to growing crops and to raw agricultural commodities after harvest.

This final rule establishes an exemption from the requirement of a tolerance under FFDCA section 408(d) in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled “Regulatory Planning and Review” (58 FR 51735, October 4, 1993). Because this final rule has been exempted from review under Executive Order 12866, this final rule is not subject to Executive Order 13211, entitled “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) or Executive Order 13045, entitled “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997). This final rule does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA) (44 U.S.C. 3501 et seq. ), nor does it require any special considerations under Executive Order 12898, entitled “Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations” (59 FR 7629, February 16, 1994).

Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. ), do not apply.

This final rule directly regulates growers, food processors, food handlers, and food retailers, not States or tribes, nor does this action alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of FFDCA section 408(n)(4). As such, the Agency has determined that this action will not have a substantial direct effect on States or tribal governments, on the relationship between the national government and the States or tribal governments, or on the distribution of power and responsibilities among the various levels of government or between the Federal Government and Indian tribes. Thus, the Agency has determined that Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999) and Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 9, 2000) do not apply to this final rule. In addition, this final rule does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) (2 U.S.C. 1501 et seq. ).

This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA) (15 U.S.C. 272 note).

Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq. ), EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register . This action is not a “major rule” as defined by 5 U.S.C. 804(2).

Therefore, 40 CFR chapter I is amended as follows:

A. Why are revisions to state programs necessary?

States which have received final authorization from the EPA under RCRA section 3006(b), 42 U.S.C. 6926(b), must maintain a hazardous waste program that is equivalent to, consistent with, and no less stringent than the Federal program. As the Federal program changes, States must change their programs and ask the EPA to authorize the changes. Changes to State programs may be necessary when Federal or State statutory or regulatory authority is modified or when certain other changes occur. Most commonly, States must change their programs because of changes to the EPA's regulations in 40 Code of Federal Regulations (CFR) parts 124, 260 through 266, 268, 270, 273, and 279.

We conclude that Oklahoma's application to revise its authorized program meets all of the statutory and regulatory requirements established by RCRA. Therefore, we grant Oklahoma Final authorization to operate its hazardous waste program with the changes described in the authorization application. Oklahoma has responsibility for permitting treatment, storage, and disposal facilities within its borders. Also section 10211(a) of the Safe, Accountable, Flexible, Efficient Transportation Equity Act of 2005 (“SAFETEA”), Public Law 109-59, 119 Statute 1144 (August 10, 2005) provides the State of Oklahoma opportunity to request approval from EPA to administer RCRA subtitle C in Indian Country and for carrying out the aspects of the RCRA program described in its revised program application, subject to the limitations of the Hazardous and Solid Waste Amendments of 1984 (HSWA). New Federal requirements and prohibitions imposed by Federal regulations that the EPA promulgates under the authority of HSWA take effect in authorized States before they are authorized for the requirements. Thus, the EPA will implement those requirements and prohibitions in Oklahoma including issuing permits, until the State is granted authorization to do so.

The effect of this decision is that a facility in Oklahoma subject to RCRA will now have to comply with the authorized State requirements instead of the equivalent Federal requirements in order to comply with RCRA. Oklahoma has enforcement responsibilities under its State hazardous waste program for violations of such program, but the EPA retains its authority under RCRA sections 3007, 3008, 3013, and 7003, which include, among others, authority to:

• Do inspections, and require monitoring, tests, analyses, or reports;

• Enforce RCRA requirements and suspend or revoke permits and

• take enforcement actions after notice to and consultation with the State.

This action does not impose additional requirements on the regulated community because the regulations for which Oklahoma is being authorized by today's action is already effective under State law, and are not changed by today's action.

The EPA did not publish a proposal before today's rule because we view this as a routine program change and do not expect comments that oppose this approval. We are providing an opportunity for public comment now. In addition to this rule, in the proposed rules section of today's Federal Register we are publishing a separate document that proposes to authorize the State program changes.

If the EPA receives comments that oppose this authorization, we will withdraw this rule by publishing a document in the Federal Register before the rule becomes effective. The EPA will base any further decision on the authorization of the State program changes on the proposal mentioned in the previous paragraph. We will then address all public comments in a later final rule. You may not have another opportunity to comment. If you want to comment on this authorization, you must do so at this time. If we receive comments that oppose only the authorization of a particular change to the State hazardous waste program, we will withdraw only that part of this rule, but the authorization of the program changes that the comments do not oppose will become effective on the date specified in this document. The Federal Register withdrawal document will specify which part of the authorization will become effective, and which part is being withdrawn.

Oklahoma initially received final Authorization on January 10, 1985, (49 FR 50362-50363) published December 27, 1984 to implement its base hazardous waste management program. We authorized the following revisions: Oklahoma received authorization for revisions to its program with publication dates: April 17, 1990 (55 FR 14280-14282), effective June 18, 1990; September 26, 1990 (55 FR 39274) effective November 27, 1990; April 2, 1991 (56 FR 13411-13413) effective June 3, 1991; September 20, 1991 (56 FR 47675-47677) effective November 19, 1991; September 29, 1993 (58 FR 50854-50856) effective November 29, 1993; October 12, 1993 (58 FR 52679-52682) effective December 13, 1993; October 7, 1994 (59 FR 51116-51122) effective December 21, 1994; January 11, 1995 (60 FR 2699-2702) effective April 27, 1995; October 9, 1996 (61 FR 52884-52886) effective December 23, 1996; Technical Correction March 14, 1997 (62 FR 12100-12101) effective March 14, 1997; September 22, 1998 (63 FR 50528-50531) effective November 23, 1998; March 29, 2000 (65 FR 16528-16532) effective May 30, 2000; May 10, 2000 (65 FR 29981-29985) effective June 10, 2000; January 2, 2001 (66 FR 28-33) effective March 5, 2001; April 9, 2003 (68 FR 17308-17311) effective June 9, 2003 and February 4, 2009 (74 FR 5994-6001); (66 FR 18927-18930) effective June 6, 2011 and March 15, 2012 (77 FR 15273-15276) effective May 14, 2012. The authorized Oklahoma RCRA program was incorporated by reference into the CFR published on December 9, 1998 (63 FR 67800-67834) effective February 8, 1999, August 26, 1999 (64 FR 46567-46571) effective October 25, 1999, August 27, 2003 (68 FR 51488-51492) effective October 27, 2003, August 27, 2010 (75 FR 36546) June 28, 2010 and May 17, 2012 (77 FR 29231-29235) effective July 16, 2012. On August 24, 2012, Oklahoma submitted a final complete program revision application seeking authorization of its program revision in accordance with 40 CFR 271.21.

The Oklahoma Hazardous Waste Management Act (“OHWMA”) provides the ODEQ with the authority to administer the State Program, including the statutory and regulatory provisions necessary to administer the provisions of RCRA Cluster XXI, and designates the ODEQ as the State agency to cooperate and share information with EPA for purpose of hazardous waste regulation. The Oklahoma Environmental Quality Code (“Code”), at 27 A O.S. Section 2-7-101 et seq. establishes the statutory authority to administer the Hazardous waste management program und subtitle C. The State regulations to manage the Hazardous waste management program is at Oklahoma Administrative Code (OAC) Title 252 Chapter 205.

The DEQ adopted applicable Federal hazardous waste regulations as amended through July 1, 2011 which became effective July 1, 2012. The provisions for which the State of Oklahoma is seeking authorization are documented in the Regulatory Documentation For Federal Provisions For Which The State Of Oklahoma Is Seeking Authorization, Federal Final Rules Published Between July 1, 2010 Through June 30, 2011 RCRA Cluster XXI prepared on June 14, 2012.

The DEQ incorporates the Federal regulations by reference and there have been no changes in State or Federal laws or regulations that have diminished the DEQ's ability to adopt the Federal regulations by reference as set forth in the authorizations at 77 FR 1236-1262, 75 FR 15273 through 15276 for RCRA Cluster XXI. The Federal Hazardous waste regulations are adopted by reference by the DEQ at OAC 252:205, Subchapter 3. The DEQ does not adopt Federal regulations prospectively.

The State Hazardous waste management program (“State Program”) now has in place the statutory authority and regulations for all required components of Checklists 225, 226 and 227 in Cluster XXI. These statutory and regulatory provisions were developed to ensure the State program is equivalent to, consistent with and no less stringent than the Federal Hazardous waste management program.

The Environmental Quality Act, at 27A O.S. Section 1-3-101(E), grants the Oklahoma Corporation Commission (“OCC”) authority to regulate certain aspects of the oil and gas production and transportation industry in Oklahoma, including certain wastes generated by pipelines, bulk fuel sales terminals and certain tank farms, as well as underground storage tanks. To clarify areas of environmental jurisdiction, the ODEQ and OCC developed an ODEQ/OCC Jurisdictional Guidance Document to identify respective areas of jurisdiction. The current ODEQ/OCC jurisdictional Guidance Document was amended and signed on January 27, 1999. The revisions to the State Program necessary to administer Cluster XXI will not affect the jurisdictional authorities of the ODEQ or OCC.

The ODEQ adopted RCRA Cluster XXI applicable federal hazardous waste regulations as amended through July 1, 2011 and became effective on July 1, 2012. The rules were also codified at OAC 252:205 et seq., Subchapter 3.

Pursuant to OAC 252:205-3-1, the State's incorporation of Federal regulations does not incorporate prospectively future changes to the incorporated sections of the 40 CFR, and no other Oklahoma law or regulation reduces the scope of coverage or otherwise affects the authority provided by these incorporated-by-reference provisions. Further, Oklahoma interprets these incorporated provisions to provide identical authority to the Federal provisions. Thus, OAC Title 252, Chapter 205 provides equivalent and no less stringent authority than the Federal Subtitle C program in effect July 1, 2011. The State of Oklahoma incorporates by reference the provisions of 40 Code of Federal Regulations (CFR) parts 124 of 40 CFR that are required by 40 CFR 271.14 (with the addition of 40 CFR 124.19(a) through (c), 124.19(e), 124.31, 124.32, 124.33 and Subpart G); 40 CFR Parts 260-268 [with the exception of 260.21, 262 Subparts E and H, 264.1(f), 264.1(g)(12), 264.149, 264.150, 264.301(1), 264.1030(d), 264.1050(g), 264.1080(e), 264.1080(f), 264.1080(g), 265.1(c)(4), 265.1(g)12), 265.149, 265.150, 265.1030(c), 265.1050(f) 265.1080(e), 265.1080(f), 265.1080(g), 268.5, 268.6, 268.13, 268.42(b), and 268.44(a) through (g)]; 40 CFR Part 270 [with the exception of 270.1(c)(2)(ix and 270.14(b)(18)]; 40 CFR Part 273; and 40 CFR Part 279.

The DEQ is the lead Department to cooperate and share information with the EPA for purpose of hazardous waste regulation.

Pursuant to 27A O.S. Section 2-7-104, the Executive Director has created the Land Protection Division (LPD) to be responsible for implementing the State Program. The LPD is staffed with personnel that have the technical background and expertise to effectively implement the provisions of the State program subtitle C Hazardous waste management program.

On August 24, 2012, the State of Oklahoma submitted final complete program applications, seeking authorization of their changes in accordance with 40 CFR 271.21. We now make an immediate final decision, subject to receipt of written comments that oppose this action that the State of Oklahoma's hazardous waste program revision satisfies all of the requirements necessary to qualify for final authorization.

The State of Oklahoma revisions consist of regulations which specifically govern Federal Hazardous waste revisions promulgated between July 1, 2010 through June 30, 2011 (RCRA Cluster XXI). Oklahoma requirements are included in a chart with this document.

There are no State requirements that are more stringent or broader in scope than the Federal requirements.

Oklahoma will issue permits for all the provisions for which it is authorized and will administer the permits it issues. The EPA will continue to administer any RCRA hazardous waste permits or portions of permits which we issued prior to the effective date of this authorization. We will not issue any more new permits or new portions of permits for the provisions listed in the Table in this document after the effective date of this authorization. The EPA will continue to implement and issue permits for HSWA requirements for which Oklahoma is not yet authorized.

Section 8 U.S.C. 1151 does not affect the State of Oklahoma because under section 10211(a) of the Safe, Accountable, Flexible, Efficient Transportation Equity Act of 2005 (“SAFETEA”), Public Law 109-59, 119 Statute 1144 (August 10, 2005) provides the State of Oklahoma opportunity to request approval from EPA to administer RCRA subtitle C in Indian Country and for carrying out the aspects of the RCRA program described in its revised program application, subject to the limitations of the Hazardous and Solid Waste Amendments of 1984 (HSWA).

Codification is the process of placing the State's statutes and regulations that comprise the State's authorized hazardous waste program into the CFR. We do this by referencing the authorized State rules in 40 CFR part 272. We reserve the amendment of 40 CFR part 272, subpart LL for this authorization of Oklahoma's program changes until a later date. In this authorization application the EPA is not codifying the rules documented in this Federal Register notice.

The Office of Management and Budget (OMB) has exempted this action from the requirements of Executive Order 12866 (58 FR 51735, October 4, 1993), and therefore this action is not subject to review by OMB. The reference to Executive Order 13563 (76 FR 3821, January 21, 2011) is also exempt from review under Executive orders 12866 (56 FR 51735, October 4, 1993). This action authorizes State requirements for the purpose of RCRA 3006 and imposes no additional requirements beyond those imposed by State law. Accordingly, I certify that this action will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). Because this action authorizes preexisting requirements under State law and does not impose any additional enforceable duty beyond that required by State law, it 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). For the same reason, this action also does not significantly or uniquely affect the communities of Tribal governments, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000). This action will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999), because it merely authorizes State requirements as part of the State RCRA hazardous waste program without altering the relationship or the distribution of power and responsibilities established by RCRA. This action also is not subject to Executive Order 13045 (62 FR 19885, April 23, 1997), because it is not economically significant and it does not make decisions based on environmental health or safety risks. This rule is not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355 (May 22, 2001)) because it is not a significant regulatory action under Executive Order 12866.

Under RCRA 3006(b), the EPA grants a State's application for authorization as long as the State meets the criteria required by RCRA. It would thus be inconsistent with applicable law for the EPA, when it reviews a State authorization application to require the use of any particular voluntary consensus standard in place of another standard that otherwise satisfies the requirements of RCRA. Thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. As required by section 3 of Executive Order 12988 (61 FR 4729, February 7, 1996), in issuing this rule, the EPA has taken the necessary steps to eliminate drafting errors and ambiguity, minimize potential litigation, and provide a clear legal standard for affected conduct. The EPA has complied with Executive Order 12630 (53 FR 8859, March 15, 1988) by examining the takings implications of the rule in accordance with the “Attorney General's Supplemental Guidelines for the Evaluation of Risk and Avoidance of Unanticipated Takings” issued under the Executive Order. This rule does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. The EPA will submit a report containing this document and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication in the Federal Register . A major rule cannot take effect until 60 days after it is published in the Federal Register . This action is not a “major rule” as defined by 5 U.S.C. 804(2). This action will be effective July 29, 2013.

In FR Doc. 2013-02372 appearing on page 23151 in the Federal Register of Thursday, April 18, 2013 (78 FR 23150), the following corrections are made.

Accordingly, 47 CFR part 0 is corrected by making the following correcting amendments:

This is a summary of the Commission's Second Memorandum Opinion and Order, ET Docket No. 04-37 and 03-104, FCC 13-53, adopted April 16, 2013 and released April 17, 2013. The full text of this document is available for inspection and copying during normal business hours in the FCC Reference Center (Room CY-A257), 445 12th Street SW., Washington, DC 20554. The complete text of this document also may be purchased from the Commission's copy contractor, Best Copy and Printing, Inc., 445 12th Street SW., Room CY-B402, Washington, DC 20554. The full text may also be downloaded at: www.fcc.gov. People with Disabilities: To request materials in accessible formats for people with disabilities (braille, large print, electronic files, audio format), send an email to fcc504@fcc.gov or call the Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-418-0432 (tty).

1. In the Second Memorandum Opinion and Order (BPL Second MO&O), the Commission addressed a petition for reconsideration filed by the national association for Amateur Radio, formally known as the American Radio Relay League (ARRL). ARRL seeks reconsideration of the Commission's Second Report and Order (BPL Second Order) in this proceeding relating to Access Broadband over Power Line (Access BPL) systems. The Commission concludes that its previous decisions in this proceeding strike an appropriate balance between the dual objectives of providing for Access BPL technology—which has potential applications for broadband and Smart Grid uses—while protecting incumbent radio services against harmful interference. The Commission denies the ARRL petition for reconsideration; it does not raise new arguments based on new information in the record or on the Commission's new analysis of limited points as directed by the Court, nor does it demonstrate any errors or omissions in the Commission's previous decisions.

2. In its Petition, ARRL again requested that the Commission modify the Access BPL rules to adopt mandatory, full-time notching of all amateur radio allocations (amateur bands), this time requesting notch depths of at least 25 dB. It bases this request on its contention that the Commission should acknowledge: (1) The unique and substantial interference potential of Access BPL systems relative to amateur radio HF communications; (2) the inapplicability and/or inadequacy of the BPL rules with respect to amateur radio interaction; (3) the clear necessity of mandatory, full-time notching by Access BPL systems of amateur radio allocations to notch depths of at least 25 dB; and (4) the absence of any negative effect on BPL systems of the obligation to maintain full-time notching of amateur bands. As discussed and as supported by the record, ARRL makes these arguments based on the same reasoning and facts that the Commission considered and disposed of previously in the BPL First Order, the BPL First MO&O, and the BPL Second Order. The Commission, again, is unpersuaded by ARRL's arguments and denies its Petition.

3. Throughout this proceeding and in its judicial appeal, the ARRL has argued that more restrictive technical standards are needed to protect the amateur radio service from interference caused by radiofrequency (RF) emissions from Access BPL systems. The Commission has specifically rejected as unnecessary these repeated requests by ARRL for tighter emissions controls on Access BPL operations, more stringent interference mitigation measures, and requirements for avoidance of BPL operations in the amateur bands.

4. The only changes adopted in the BPL Second Order were minor adjustments to the rules as proposed in the BPL RFC/FNPRM. Specifically, the Commission: (1) Modified the rules to increase the required notch filtering capability for systems operating below 30 MHz from 20 dB to 25 dB; (2) established a new alternative procedure for determining site-specific extrapolation factors, and (3) adopted a definition for the “slant-range distance” used in the BPL measurement guidelines to further clarify its application. As indicated, the Commission also explained its rationale for and affirmed its use of a 40-dB-per-decade extrapolation factor for frequencies below 30 MHz.

5. ARRL is not specifically requesting reconsideration of these minor modifications to the rules that were adopted in the BPL Second Order. Rather, ARRL is reiterating its previous request for mandatory full-time permanent notching of all amateur radio allocations, which the Commission considered and rejected in the BPL Second Order. In support of this request, ARRL makes several arguments, which the Commission considered sequentially.

6. First, ARRL disagrees with the Commission's analyses and conclusions on the staff studies and their bearing on the adequacy of the Access BPL rules. ARRL argues that in the BPL Second Order the Commission discounts its own study conducted by its Technical Research Branch (TRB) by mischaracterizing the results and by attempting to distance itself from TRB's studies and recommendations. The Commission notes that in the BPL Second Order, the Commission discussed this issue at length, and explained its rationale with respect to each point of this same argument that ARRL first raised in its comments to the BPL RFC/FNPRM. ARRL makes no new argument here. ARRL here contends that TRB's studies ( i.e., all of the 2003 and 2004 field studies and the July 2009 released documents) used scientifically valid methodologies and the Commission did not rebut them as a technical matter. ARRL specifically did not agree with the Commission's assessment in the BPL Second Order regarding the video files of the now-defunct BriarCliff Manor experimental BPL system (BriarCliff Manor video#5) recorded on August 17, 2004 that were part of the released July 2009 staff materials. In this regard, the Commission notes that it explained in detail the particulars of that experimental BPL system and the reasons why it did not rely on TRB's technical findings, stating that “. . . it does not appear that any of the mitigating features that are required in the rules had been applied to this experimental BPL system” [at the time the video clip was made.] In particular, the Commission noted that “our staff did contact the licensee about interference from that system several times over the course of its operation and the operator took steps first to cease operation on the amateur frequencies and then to install new equipment that had notching capability. Subsequent examination of that system by field agents of our Enforcement Bureau (EB) found no interference, which substantiates the effectiveness of our rules when properly observed.” The Commission further observed that it pointed out with in-depth analyses in the BPL Second Order that it simply did not draw the same conclusions from the released studies and materials as ARRL did, and that “in some cases, ARRL simply (and incorrectly) draws different conclusions from the . . . [staff studies and] presentations than we do.” ARRL has made no new argument with respect to this contention that was not already considered and disposed of in our earlier decisions.

7. ARRL also repeats its disagreements with the Commission's assessment of the nature of Access BPL technology. It questions the Commission's reasons for not imposing conducted emission limits on Access BPL and instead atypically imposing only radiated emission limits. It contends that according to several BPL standards, the actual conducted emission level for BPL is approximately 30 dB higher than the conducted emission levels for other part 15 devices that are not carrier current systems. Note that the Commission discussed this issue in the BPL First Order in which it explained that because Access BPL signals are transported on medium voltage power lines of up to 40,000 volts, there would be extreme safety issues for test personnel involved in connecting test equipment that would have to be able to measure conducted emissions in such high voltage lines. This determination is now long-since established and ARRL did not submit any new information in its reconsideration petition here.

8. ARRL also argues that the BPL Second Order did not address why the emission limits for BPL are set at levels as much as 25 dB greater than the generally-accepted median levels of ambient noise in typical environments and more than 45 dB greater than the quiet rural environment that represent the more quiet times and frequencies within an amateur band. The Commission notes that the emission limits for Access BPL are the same as the general emission limits in § 15.209 of the rules for other part 15 intentional radiators, which have been in existence in various forms for over 50 years; furthermore, as was discussed in the BPL Second Order, “to minimize the potential for harmful interference, facilitate its resolution where it may occur, and address cases where it's possible occurrence could impact critical services, the Commission adopted additional regulatory measures beyond the emissions limits in the part 15 rules.” With regard to the ambient noise levels (noise floor), the Commission discussed these issues at length in the BPL Second Order and provided additional protection for all licensed services, including amateur service, by requiring an increase of 5 dB in the notching capability of Access BPL systems.

9. ARRL disagrees with the Commission's conclusion in the BPL Second Order that BPL systems increase the noise floor only within a relatively short distance (15-400 meters) from the power lines; it complains that this “unquantifiable increase in noise floor” is apparently not acceptable to the Commission when the victim operates in a U.S. Government frequency band ( e.g., aeronautical service) but is acceptable when the victim is an amateur radio station. ARRL argues that this treatment of different licensed radio services is arbitrary and capricious on its face. The Commission notes here that in both the BPL First Order and the BPL Second Order, the Commission discussed at length the reasons for its decision to designate only certain frequencies used by “critical” Federal Government services as recommended by NTIA, as being excluded from Access BPL usage (only 2% of the spectrum within the 1.7-80 MHz band qualify as excluded frequencies.) Although ARRL has repeatedly requested to have all amateur HF and VHF allocations be included with critical Federal Government services, the Commission found, and still finds, that amateur radio frequencies do not warrant the special protection afforded to frequencies reserved for international aeronautical and maritime safety operation. In this regard, the Commission notes that amateur frequencies are generally used for routine communications and hobby activities, notwithstanding the fact that amateurs may on occasion assist in providing emergency communications. The Commission finds that the recently released information in the staff unredacted studies did not provide any new information not already known to the Commission and ARRL did not bring any new information on this issue on reconsideration.

10. ARRL next points to issues regarding the interference potential from Access BPL systems to amateur radio operations. It argues that in the BPL First Order at paragraph 39, the Commission was wrong in stating that BPL is not an efficient radiator, and that BPL interference actually permeates large areas because overhead unshielded power lines exist throughout residential areas, not just along one line of one roadway. The Commission addressed this issue in the BPL First Order, making reference to the NTIA Phase 1 Study in which NTIA agrees with the Commission that these systems are not efficient radiators, nor are their emissions cumulative such that they permeate areas in which they are located. The Commission also addressed ARRL's repeated argument that BPL causes preclusive interference over large areas in the BPL Second Order. ARRL did not bring any new information or argument to this issue on reconsideration.

11. In requesting reconsideration of the Commission's decision to decline its request for full-time permanent notching of amateur bands in the BPL Second Order, ARRL claims that the Commission ignores the ubiquitous nature of amateur radio and such a decision completely fails to prevent interference to mobile stations. It argues that a mobile amateur station should not have to drive outside an entire city or community in order to be able to communicate. The Commission discussed the issue of mobile communications in detail along with the variability of levels in HF communications, stating in part that “. . . the significant variability in background noise levels limits the reliability of HF signals below 30 MHz such that BPL emissions at . . . [the limit required in the rules] . . . should not generally be considered harmful interference;” however, “to take a more conservative approach [the Commission] decided to provide additional protection to mobile stations by increasing the required notch depth from 20 dB to 25 dB.” ARRL did not bring any new information to this issue on reconsideration.

12. ARRL also states that on December 29, 2010, it submitted a BPL interference complaint jointly to the Commission's Enforcement Bureau (EB) and Office of Engineering and Technology (OET) regarding some BPL systems operated by International Broadband Electric Communications (IBEC), and on February 10, 2011, it submitted a request to OET to set aside the certification grants for the equipment used by these IBEC BPL systems. ARRL argues that because no action has been taken on these complaints, the rules should require permanent notching of amateur frequencies since post hoc enforcement of interference issues is not adequate. Over the years, the Commission has investigated and taken action on BPL complaints where it appeared that it was warranted. In the early period of BPL development, before the rules were in place and compliant equipment was in use, some of our investigations took time to complete. After the rules were established in 2004, there were fewer incidences of interference complaints and we have had cooperation from the BPL system operators to resolve them. Before the Commission could take action on ARRL's December 2010 interference complaint and February 2011 request regarding IBEC, IBEC had started the shut-down of all its BPL operations, making investigation of its operations as they related to the complaints moot. This anomalous case cannot be extrapolated to conclude that the Commission does not have the capability and/or readiness to enforce its BPL rules. To the contrary, the Commission has diligently investigated previous complaints about interference from BPL systems.

13. ARRL further disagrees with the Commission's assumption in the BPL Second Order that the BPL operator has a strong incentive to voluntarily utilize full notching of the amateur bands in the vicinity of amateur radio operators for interference mitigation unless full-time permanent notching of amateur bands throughout a BPL system is required by the rules. The Commission reiterates here, to the contrary, that “[g]iven that identification and resolution of harmful interference can involve expenditures of staff time and resources for Access BPL providers and possibly the temporary disruption of service to their subscribers, these providers have a strong incentive to take a priori steps to ensure that they avoid causing interference to the local radio services, including amateurs”. ARRL has not provided a basis for reconsideration of this position. As for ARRL's complaint that IBEC BPL systems in operation in North Carolina, Virginia and Pennsylvania at one time did voluntarily notch amateur bands but stopped doing so, IBEC and other operators were not obligated to notch, or continue to notch, the amateur bands on a full-time, system-wide basis. The Commission does not see a reason to consider the IBEC experience involving a single interference complaint for a system that was ultimately shut down to be a basis for imposing a mandatory notching requirement. In any event, ARRL fails to relate that in the decision which it challenges here we merely noted the likely incentive for BPL operators to notch where that provides the most efficacious approach for dealing with potential interference issues. We clearly did not rely on voluntary, full-time, system-wide notching as a basis for our rules at that time nor do we now.

14. ARRL next contends that the Commission ignored several sources that point to a high probability of interference from Access BPL to existing HF and VHF spectrum users. In accordance with the Court's mandate, the Commission analyzed all relevant information and explained in great detail in the BPL Second Order that it is not persuaded by ARRL's technical submissions, including the reports and technical standards referenced in its numerous filings, that our assessment of the interference potential from BPL operations was incorrect or inappropriate, or that modifications to the BPL emissions limits and other technical rules to provide additional protection for the amateur service are warranted. In its instant Petition, ARRL specifically argues that the Commission did not discuss an OFCOM study on In-House BPL in our consideration of Access BPL interference potential. However, that report was not given significant weight in our deliberations because it specifically covers In-House BPL, the operating characteristics of which are significantly different from those of Access BPL and therefore render that report not substantively relevant to the issues under consideration in the present proceeding.

15. ARRL repeats its argument that the BPL database contains many errors that undermine the usefulness of the database as a tool for interference mitigation. In the BPL Second Order the Commission encouraged the database administrator, the Utilities Telecom Council (UTC) to be diligent in its management of the database and other interested parties to work with UTC in providing information to ensure that the records in the database are accurate and up-to-date, and UTC affirmed that the database has been and is being reviewed periodically to ensure that the information is currently accurate. The Commission also notes that there could be some period of time between the date a BPL operator enters information into the BPL database regarding a near-future deployment and the actual deployment date, which might depend on business conditions, financial obligations, change in business plans, etc. The Commission expressed its expectation that UTC periodically contact its BPL database members to ensure that obsolete information is removed or updated and we have counseled UTC on its obligations. While the Commission expects the BPL database to be maintained to accurately indicate the status of BPL operations, it nonetheless note that an Access BPL system that ceases to operate without updating its database information does not pose an increased potential for unanticipated interference. If any specific cases of BPL operators failing to provide information to the database in a timely fashion as required by § 15.615(a) of the Commission's rules are brought to our attention, the Commission will consider taking enforcement action as appropriate.

16. ARRL next takes issue with the alternative procedure for determining site-specific extrapolation factors for BPL systems adopted in the BPL Second Order. ARRL again complains that measurements at four points are inadequate to establish a reliable extrapolation factor. ARRL again repeats its original argument that measurements should be made along the power line for each measurement distance from that line, and that the maximum value at each distance from that line for each frequency be used for the calculation. The Commission reiterates that while it did not adopt ARRL's suggested procedure involving the number of measurement points along the power line, our new method for determining site-specific extrapolation factors follows the IEEE Standard P1775-2010 that requires measurements to be made at a minimum of four points; however, depending on the specific installation site, this method could require measuring many more data points in order to establish a straight line with a minimum 0.9 regression coefficient of multiple correlation. This multiple-point requirement and the resultant potentially numerous measurements counter ARRL's repeated concern that having measurements at “only four points” is “woefully inadequate.” The Commission has analyzed and rejected ARRL's proposal in the BPL Second Order in favor of the procedure published in the IEEE Standard P1775-2010, which the Commission also noted was an improvement over current practices, and ARRL makes no new arguments here.

17. ARRL further argues that since the Commission acknowledged in the BPL Second Order that there is variability in the attenuation of emissions from BPL systems across individual sites that are not captured by a uniform extrapolation factor, full-time notching of amateur bands is called for. However, this is one of the stated reasons for which the Commission adopted the alternative procedure for determining site-specific extrapolation factors. The Commission noted that the option to use site-specific values can substantially alleviate the measurement concerns associated with the standard extrapolation factor and the variability in attenuation rates that may be observed in the field, and particularly where measurements at a site may plainly not appear to conform to the 40-dB-per-decade standard. The Commission again observes that it has addressed ARRL's concerns with the alternative method for determining site-specific extrapolation factors at length in the BPL Second Order, and ARRL makes no new arguments here.

18. ARRL also continues to dispute the Commission's decision to retain the existing 40-dB-per-decade value for the standard distance extrapolation factor for BPL systems. The Commission discussed this issue at length in the BPL Second Order and concluded that there is no single “correct” value for an extrapolation for RF emissions from power lines due to a multitude of reasons and that there is no basis for changing from the longstanding 40-dB-per-decade standard. However, the Commission notes that by explicitly providing that “slant-range” distance is to be used in conjunction with the extrapolation factor when calculating the emission levels, the existing 40-dB-per-decade extrapolation factor produces values that are closer to what ARRL calculates using what it believes to be the correct extrapolation factor (20 dB per decade). Here, ARRL agrees with the Commission that the slant-range method may be a slight improvement over using horizontal distance, but again repeats its previous argument that radiated emission levels above the power lines are stronger than they are at near-ground levels and contends that BPL emission measurements should be made at the level of the power lines, not close to the ground as specified in the BPL Measurement Guidelines because such measurement would not capture the worst-case emissions. It also re-argues that NTIA recommended a 5 dB correction factor to address this deficiency but the Commission chose not to adopt it. The Commission disposed of the issue regarding receive antenna height and correction factor in both the BPL First Order and BPL Second Order. ARRL did not bring any new information on reconsideration here.

19. Finally, ARRL contends that there would not be any negative effect on BPL systems if the Commission were to implement full-time notching of amateur radio allocations to notch depths of at least 25 dB and therefore argues that its request would not be burdensome to the BPL industry. The Commission does not believe that it should require all BPL systems to permanently notch specific frequencies at a certain notch depth just because the technology is capable of doing so. As stated in the BPL Second Order, to require that BPL systems permanently avoid all the amateur radio frequencies would unnecessarily restrict BPL operations and leave unused valuable Access BPL capacity in areas/locations where no amateur operations are present that could receive interference. ARRL did not bring any new information on reconsideration here.

20. In its opposition to the Petition, Current Group LLC (Current) contends that the ARRL Petition is largely a rehash of previous filings, and that the Commission should find that the Petition has failed to make a prima facie case for reconsideration and summarily deny it. Similarly, the Edison Electric Institute and the Utilities Telecom Council (EEI/UTC) argue that as a procedural matter, the ARRL's request for full-time notching of the entire amateur band has been rejected before and may not be raised again in reconsideration of the BPL Second Order. The HomePlug Powerline Alliance (HomePlug) also states that ARRL's arguments have already been fully considered by the Commission no less than three times in this proceeding and its Petition should be denied or dismissed pursuant to § 1.106(p)(3) of the Commission rules. As discussed, the Commission largely agrees with these oppositions and denies the petition for reconsideration for the reasons stated.

21. Pursuant to authority contained in contained in sections 4(i), 301, 302, 303(e), 303(f), 303(r), and 405 of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 301, 302a, 303(e), 303(f), 303(r), 405, and 1.429 of the Commission's rules, 47 CFR Section 1.429, that the Petition for Reconsideration filed by ARRL is denied.

22. The Commission's Consumer and Governmental Affairs Bureau, Reference Information Center, shall send a copy of this Second Memorandum Opinion and Order, including the Final Regulatory Flexibility Certification, to the Chief Counsel for Advocacy of the Small Business Administration.

23. The Commission will not send a copy of this Second Memorandum Opinion and Order pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A), because the Commission did not adopt any new rules here.

In this Report & Order ( R&O ), FCC 13-64, adopted May 8, 2013, and released May 17, 2013, the Commission requires all CMRS providers and providers of interconnected text messaging services ( i.e., all providers of software applications that enable a consumer to send text messages to all or substantially all text-capable U.S. telephone numbers and receive text messages from the same) (collectively, “covered text providers”) to provide an automatic “bounce-back” text message in situations where a consumer attempts to send a text message to 911 in a location where text-to-911 is not available. The rules the Commission adopts will substantially reduce the risk of a person sending a text message to 911 in an emergency and mistakenly believing that 911 authorities have received it. Instead, the text sender will receive an immediate response that text-to-911 is not supported along with direction to use another means to contact emergency services, e.g., place a voice call to 911.

Requiring all covered text providers to implement a bounce-back mechanism is particularly important because while deployment of text-to-911 has begun, the transition is still in the very early stages and will not be uniform. During the transition, text-to-911 will be available in certain geographic areas sooner than it is available in others and may be supported by certain service providers but not by others. At the same time, as text-to-911 becomes more widely available, it is likely to generate increased consumer expectations as to its availability, which makes it increasingly important for consumers to be made aware when it is not available in an emergency.

The Commission finds that it is technically feasible for all covered text providers to provide automatic bounce- back messages. The record in this proceeding indicates that some service providers already send an automatic bounce-back message to their subscribers when a subscriber attempts to send a text to 911. In addition, the four largest CMRS providers—AT&T, Sprint Nextel, T-Mobile, and Verizon—have voluntarily committed to provide bounce-back messaging capability throughout their networks by June 30, 2013. While the Commission finds that it is technically and economically feasible for all covered text providers to implement this capability quickly, the Commission recognizes that not all providers may be able to do so by the June 30, 2013 date to which the four major carriers are committed. Therefore, the Commission establishes September 30, 2013 as the deadline for all covered text providers to implement the bounce-back capability required by this R&O. However, the Commission encourages covered text providers to implement bounce-back message capabilities as soon as possible in order to deal expeditiously with the existing consumer confusion about the availability of text-to-911. Although this new requirement will impose additional costs on some of the covered text providers, the Commission has determined that these costs are small and likely will be far exceeded by the public benefits of substantially reducing the risk of persons sending a text message to 911 in an emergency and mistakenly believing that 911 authorities have received it.

In addition to all CMRS providers, the Commission extends the bounce-back requirements adopted in the R&O to all interconnected text messaging providers. The Commission defines interconnected text providers as those providers that enable a consumer to send text messages to all or substantially all text-capable U.S. telephone numbers and receive text messages from the same. Such providers of interconnected text messaging service include providers that enable the transmission of covered messages over their own networks or facilities ( e.g., CMRS licensees), as well as third-party or over-the-top (OTT) providers that enable the transmission of covered texts over another providers' network or facilities, including through the use of applications downloaded on mobile phones. For interconnected text applications on the market prior to the adoption of the R&O, interconnected text providers must make an update available by the September 30, 2013 implementation date. For future applications not on the market as of the date of the adoption of this R&O, interconnected text providers must incorporate a bounce-back message capability into their initial programming.

The Commission affirms that it is extending this provision only to interconnected text message applications as defined in the R&O, and not to non-interconnected IP-based messaging applications that support communication with a defined set of users of compatible applications but that do not support general communication with text-capable telephone numbers. Additionally, the Commission clarifies that the rules adopted in the R&O do not apply to voice-only service providers.

For clarity, the Commission states that the service must be capable of reaching “all or substantially all” text-capable U.S. telephone numbers and removing the reference to mobile numbers, since the North American Numbering Plan does not make distinctions between numbers in the plan. The Commission also affirms that the definition of interconnected text does not extend to text messages that are directed by IP-based messaging applications that support communication with a defined set of users of compatible applications but that do not support general communication with all or substantially all text-capable telephone numbers.

The Commission adopts its proposal with certain modifications to address concerns raised by commenters to the FNPRM. 1 In general, the R&O requires all covered text providers ( i.e., both CMRS providers and interconnected text providers) to provide a bounce-back message when a consumer attempts to send a text message to a PSAP by means of the three-digit short code “911” and the covered text provider cannot deliver the text because (1) the consumer is located in an area where text-to-911 is not available, or (2) the covered text provider either does not support text-to-911 generally or does not support it in the particular area at the time of the consumer's attempted text.

The first scenario addresses the situation where the PSAP serving the consumer's geographic area has not yet implemented text-to-911 capability. The Commission includes the second scenario to address instances where a covered text provider does not support text-to-911, even in areas where the PSAP has implemented text-to-911 capability. This is necessary because implementation of text-to-911 by covered text providers will not be uniform across the nation or within any given area. For example, most of the text-to-911 trials and deployments to date have involved PSAPs only receiving texts from a single carrier. In those situations, consumers of other carriers that are not yet supporting the PSAP's trial or deployment will be unable to send text messages to 911 for some period of time. Therefore, the Commission requires these carriers to provide a bounce-back message to consumers—even though the PSAP is making text-to-911 “available” in the area.

The Commission also notes that the rule it adopts today requires all covered text providers to implement bounce-back capability even though some providers contend that they cannot and should not be required to support text-to-911. The Commission has not yet decided the issue of whether all covered text providers should be required to support text-to-911 as proposed in the FNPRM. That issue remains pending in this proceeding, and the Commission does not prejudge it here. However, regardless of whether all covered text providers are eventually required to support text-to-911, the fact that they provide the ability to text to telephone numbers generally is likely to lead some consumers to assume that they also have text-to-911 capability. This could further lead consumers to put themselves at risk by attempting to send emergency text messages over such applications. The Commission therefore concludes that to prevent consumer confusion and protect life and safety in such situations, the bounce-back requirement should apply to all covered text providers that do not support text-to-911 services.

As proposed in the FNPRM, the Commission requires covered text providers to provide bounce-back messages only in those cases where the provider (or the provider's text-to-911 vendor) has direct control over the transmission of the text message. 2 The Commission does not require that a bounce-back be provided in every instance where a confirmation of delivery is not received by the text provider, because this may include circumstances outside the text provider's control. However, the Commission agrees that a bounce-back message should be provided when the text provider cannot determine the PSAP to which the text should be routed.

The Commission further clarifies that the obligation of an interconnected text provider with respect to providing an automatic bounce-back message may differ depending on whether the application uses an IP-based network or a CMRS provider's underlying SMS network to deliver text messages to text-capable telephone numbers. Some interconnected text applications use IP-based transmissions to route text messages to a server, which then converts the message to SMS if necessary for delivery to the destination number. 3 In such cases, the interconnected text service provider is responsible for delivering an application-based automatic bounce-back message to consumers if and when text-to-911 is unavailable. Other interconnected text applications are configured to transmit text messages in SMS format directly over the SMS network of the consumer's underlying CMRS provider, which will result in the application user receiving a bounce-back message from the CMRS provider when text-to-911 is not available. 4 In these cases, where the text message defaults to the underlying CMRS provider's network, the interconnected text provider satisfies its consumer notification obligation so long as it does not prevent or inhibit the CMRS provider's automatic bounce-back message from being delivered to the application user.

The Commission also requires covered text providers that are delivering texts to PSAPs that are supporting text-to-911 to provide a mechanism for the PSAP to request temporary suspension of text for any reason, including but not limited to network congestion, call-taker overload, PSAP failure, or security breach. 5 In those circumstances, the covered text provider must provide a bounce-back message to any consumer attempting to send a text to 911 in the area covered by the temporary suspension. Covered text providers must also provide a mechanism to allow PSAPs to resume text-to-911 service after such temporary suspension. The Commission encourages carriers, interconnected text messaging providers and PSAPs to establish standard protocols and interfaces for triggering these mechanisms. The Commission also emphasizes that the bounce-back requirement will only apply where the PSAP requests the temporary shutdown using a notification mechanism established by the provider or the provider's vendor for this purpose. The Commission encourages PSAPs and covered text providers to work together when establishing temporary shutdown mechanisms, so that both PSAPs and providers are clearly apprised of their respective roles and have established procedures in place for establishing such temporary shutdowns.

For the reasons of public safety and public awareness cited above, the Commission does not find it appropriate to adopt any form of blanket exemption of the September 30, 2013 requirement for CMRS providers and interconnected text messaging providers that believe they will not be able to meet the deadline. Any covered providers who are unable to implement the bounce-back requirement by September 30, 2013 should file a request for waiver. Waivers or exemptions from these requirements are best suited to a case-by-case analysis under the waiver standard, where the facts and circumstances of each individual case can be determined on its own merits. 6 Notwithstanding the availability of the waiver process, we emphasize the important public safety purpose of this requirement and our expectation that providers will implement bounce-back messaging by the deadline.

The Commission requires all covered text providers to provide an automatic bounce-back message that includes, at a minimum, two essential points of information: (1) That text-to-911 is not available; and (2) that the consumer should try to contact 911 using another means. As an example, a sufficient bounce-back message that satisfies these criteria could say: There is no text-to-911 service available. Make a voice call to 911 or use another means to contact emergency services. The Commission declines to require covered text providers to use specific wording. 7 The Commission believes its approach affords covered text providers with the necessary guidance and flexibility to create bounce-back messages that are understood by their particular consumer base. In addition, the approach enables covered text providers to continue to use the messages they presently have in operation, to the extent that they conform to these criteria. 8 This approach also provides sufficient uniformity in automatic bounce-back messages to allow for consistent training and public education materials.

Additionally, the Commission requires all CMRS providers to provide an automatic bounce-back message when a consumer roaming on a network initiates a text-to-911 in an area where text-to-911 service is not available. Consumers roaming on other carriers' networks have an expectation that they can access 911 services in an emergency. Given the important safety of life implications, carriers should make automatic bounce-back messages available to consumers roaming on their network to the same extent they provide such messages to their own subscribers.

The Commission recognizes that certain legacy devices are not capable of sending text messages to a three-digit short code. For those devices that are not capable of generating messages to 911 and whose text messaging software cannot be upgraded over the air ( e.g., through a push software upgrade), the CMRS provider will never receive a message and thus cannot generate a bounce-back message. 9 The Commission clarifies that legacy devices that are incapable of sending texts via three digit short codes are not subject to the bounce-back message requirement, provided the software for these devices cannot be upgraded over the air to allow text-to-911. In such cases, the messaging application or interface on the mobile device will likely provide an error message indicating an invalid destination number, reducing user confusion somewhat even if the message is less specific than the bounce-back message. If the text messaging software can be upgraded, however, the Commission treats such devices in the same manner as the software offered by interconnected text providers.

The Commission clarifies that CMRS providers are not required to provide an automatic bounce-back message when a consumer attempts to text 911 on a non-service initialized phone. Deliberations of the EAAC have affirmed that the text capability of non-service initialized handsets is neither technically nor economically feasible. 10 At the same time, the Commission notes that some providers may provide text messaging solutions that allow users to send text messages even on NSI phones ( e.g., Wi-Fi-enabled text applications). The Commission clarifies that those text providers must still provide bounce-back messaging consistent with the rules we adopt today.

Finally, the Commission declines to require covered text providers to provide consumers with text-to-911 testing capability at this time. Until operational experience indicates otherwise, the Commission believes that consumer education efforts should discourage the sending of texts to 911 except in actual emergencies.

The Commission has already committed the Public Safety and Homeland Security Bureau (PSHSB) and the Consumer and the Consumer and Governmental Affairs Bureau (CGB) to implement a comprehensive consumer education program concerning text-to-911, and to coordinate their efforts with state and local 911 authorities, other federal and state agencies, public safety organizations, industry, disability organizations, and consumer groups. The Commission directs PSHSB and CGB to put in place a consumer information Web site that provides the public with information and instructions on how and when to use text-to-911 no later than June 30, 2013.

The R&O is available at http://www.fcc.gov/document/text-911-bounce-back-message-order .

The R&O does not contain new information collection requirements subject to the Paperwork Reduction Act of 1995 (PRA), Public Law No. 104-13. Therefore, it does not contain any new or modified information collection burden for small business concerns with fewer than 25 employees, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198.

The Commission will send a copy of this Report & Order to Congress and the Government Accountability Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

As required by the Regulatory Flexibility Act (RFA), 11 the Commission has prepared this present Final Regulatory Flexibility Analysis (FRFA) of the possible significant economic impact on small entities by the policies and rules proposed in this R&O. The Commission will send a copy of this R&O, including this FRFA, to the Chief Counsel for Advocacy of the Small Business Administration (SBA). 12 In addition, the R&O and FRFA (or summaries thereof) will be published in the Federal Register . 13

In this Report & Order ( R&O ), the Commission requires all CMRS providers and providers of interconnected text messaging services ( i.e., all providers of software applications that enable a consumer to send text messages to all or substantially all text-capable U.S. telephone numbers and receive text messages from the same) to provide an automatic “bounce-back” text message in situations where a consumer attempts to send a text message to 911 in a location where text-to-911 is not available. The rules the Commission adopts in R&O will substantially reduce the risk of a person sending a text message to 911 in an emergency and mistakenly believing that 911 authorities have received it. Instead, the text sender will receive an immediate response that text-to-911 is not supported along with direction to use another means to contact emergency services.

Requiring all CMRS providers and interconnected text providers to implement a bounce-back mechanism is particularly important because while deployment of text-to-911 has begun, the transition is still in the very early stages and will not be uniform. During the transition, text-to-911 will be available in certain geographic areas sooner than it is available in others and may be supported by certain service providers but not by others. At the same time, as text-to-911 becomes more widely available, it is likely to generate increased consumer expectations as to its availability, which makes it increasingly important for consumers to be made aware when it is not available in an emergency.

The record in this proceeding indicates that some service providers already send an automatic bounce-back message to their subscribers when a subscriber attempts to send a text to 911. In addition, the four largest CMRS providers—AT&T, Sprint Nextel, T-Mobile, and Verizon—have voluntarily committed to provide bounce-back messaging capability throughout their networks by June 30, 2013. In this R&O, the Commission builds on this voluntary commitment and concludes that all CMRS providers and interconnected text providers (collectively, “covered text providers”) should be required to provide this capability. The Commission further specifies the circumstances under which a bounce-back message must be provided and the information that the message must contain. Finally, while the Commission finds it is technically and economically feasible for all covered text providers to implement this capability quickly, the Commission recognizes that not all providers may be able to do so by the June 30, 2013 date to which the four major carriers are committed. Therefore, the Commission establishes September 30, 2013 as the deadline for all covered text providers to implement the bounce-back capability required by this R&O. However, the Commission encourages covered text providers to implement bounce-back message capabilities as soon as possible in order to deal expeditiously with the existing consumer confusion about the availability of text-to-911. Although this new requirement will impose additional costs on some of the covered text providers, the Commission has determined that these costs likely will be far exceeded by the public benefits of substantially reducing the risk of persons sending a text message to 911 in an emergency and mistakenly believing that 911 authorities have received it.

No commenter raised issues in response to the bounce-back portion of the IRFA included in the FNPRM. The Commission concludes that the proposed mandates here provide covered text providers and Public Safety Answering Points (PSAPs) with a sufficient measure of flexibility to account for technical and cost-related concerns. In the event that small entities face unique circumstances that restrict their ability to comply with the Commission's rules, the Commission can address them through the waiver process. The Commission has determined that implementing bounce-back messages is technically feasible and the cost of implementation is small.

The RFA directs agencies to provide a description of, and, where feasible, an estimate of the number of small entities that may be affected by the rules adopted, herein. 14 The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.”  15 In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. 16 A “small business concern” is one which: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the SBA. 17 Below, the Commission describes and estimates the number of small entity licensees that may be affected by the adopted rules of this R&O.

Small Businesses, Small Organizations, and Small Governmental Jurisdictions. As of 2009, small businesses represented 99.9% of the 27.5 million businesses in the United States, according to the SBA. 18 Additionally, a “small organization” is generally “any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.”  19 Nationwide, as of 2007, there were approximately 1,621,315 small organizations. 20 Finally, the term “small governmental jurisdiction” is defined generally as “governments of cities, counties, towns, townships, villages, school districts, or special districts, with a population of less than fifty thousand.” 21 Census Bureau data for 2007 indicate that there were 89,527 governmental jurisdictions in the United States. 22 The Commission estimates that, of this total, as many as 88,761 entities may qualify as “small governmental jurisdictions.” 23 Thus, the Commission estimates that most governmental jurisdictions are small.

Below, for those services subject to auctions, the Commission notes that, as a general matter, the number of winning bidders that qualify as small businesses at the close of an auction does not necessarily represent the number of small businesses currently in service. Also, the Commission does not generally track subsequent business size unless, in the context of assignments or transfers, unjust enrichment issues are implicated.

Wireless Telecommunications Carriers (except satellite). This industry comprises establishments engaged in operating and maintaining switching and transmission facilities to provide communications via the airwaves. Establishments in this industry have spectrum licenses and provide services using that spectrum, such as cellular phone services, paging services, wireless Internet access, and wireless video services. 24 The appropriate size standard under SBA rules is for the category Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees. 25 Census Bureau data for 2007, which now supersede data from the 2002 Census, show that there were 3,188 firms in this category that operated for the entire year. Of this total, 3,144 had employment of 999 or fewer, and 44 firms had employment of 1,000 employees or more. Thus under this category and the associated small business size standard, the Commission estimates that the majority of wireless telecommunications carriers (except satellite) are small entities that may be affected by our actions. 26

Incumbent Local Exchange Carriers (Incumbent LECs). Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to incumbent local exchange services. The closest applicable size standard under SBA rules is for Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees. 27 According to Commission data, 1,307 carriers reported that they were incumbent local exchange service providers. 28 Of these 1,307 carriers, an estimated 1,006 have 1,500 or fewer employees and 301 have more than 1,500 employees. 29 Consequently, the Commission estimates that most providers of incumbent local exchange service are small businesses that may be affected by rules adopted pursuant to the NPRM.

The Commission has included small incumbent LECs in this present RFA analysis. As noted above, a “small business” under the RFA is one that, inter alia, meets the pertinent small business size standard ( e.g., a telephone communications business having 1,500 or fewer employees), and “is not dominant in its field of operation.”  30 The SBA's Office of Advocacy contends that, for RFA purposes, small incumbent LECs are not dominant in their field of operation because any such dominance is not “national” in scope. 31 The Commission has therefore included small incumbent LECs in this RFA analysis, although it emphasizes that this RFA action has no effect on Commission analyses and determinations in other, non-RFA contexts.

Competitive Local Exchange Carriers (Competitive LECs), Competitive Access Providers (CAPs), Shared-Tenant Service Providers, and Other Local Service Providers. Neither the Commission nor the SBA has developed a small business size standard specifically for these service providers. The appropriate size standard under SBA rules is for the category Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees. 32 According to Commission data, 1,442 carriers reported that they were engaged in the provision of either competitive local exchange services or competitive access provider services. 33 Of these 1,442 carriers, an estimated 1,256 have 1,500 or fewer employees and 186 have more than 1,500 employees. 34 In addition, 17 carriers have reported that they are Shared-Tenant Service Providers, and all 17 are estimated to have 1,500 or fewer employees. 35 In addition, 72 carriers have reported that they are Other Local Service Providers. 36 Of the 72, seventy have 1,500 or fewer employees and two have more than 1,500 employees. 37 Consequently, the Commission estimates that most providers of competitive local exchange service, competitive access providers, Shared-Tenant Service Providers, and Other Local Service Providers are small entities that may be affected by rules adopted pursuant to the NPRM.

Broadband Personal Communications Service. The broadband personal communications services (PCS) spectrum is divided into six frequency blocks designated A through F, and the Commission has held auctions for each block. The Commission initially defined a “small business” for C- and F-Block licenses as an entity that has average gross revenues of $40 million or less in the three previous calendar years. 38 For F-Block licenses, an additional small business size standard for “very small business” was added and is defined as an entity that, together with its affiliates, has average gross revenues of not more than $15 million for the preceding three calendar years. 39 These small business size standards, in the context of broadband PCS auctions, have been approved by the SBA. 40 No small businesses within the SBA-approved small business size standards bid successfully for licenses in Blocks A and B. There were 90 winning bidders that claimed small business status in the first two C-Block auctions. A total of 93 bidders that claimed small business status won approximately 40 percent of the 1,479 licenses in the first auction for the D, E, and F Blocks. 41 On April 15, 1999, the Commission completed the reauction of 347 C-, D-, E-, and F-Block licenses in Auction No. 22. 42 Of the 57 winning bidders in that auction, 48 claimed small business status and won 277 licenses.

On January 26, 2001, the Commission completed the auction of 422 C and F Block Broadband PCS licenses in Auction No. 35. Of the 35 winning bidders in that auction, 29 claimed small business status. 43 Subsequent events concerning Auction 35, including judicial and agency determinations, resulted in a total of 163 C and F Block licenses being available for grant. On February 15, 2005, the Commission completed an auction of 242 C-, D-, E-, and F-Block licenses in Auction No. 58. Of the 24 winning bidders in that auction, 16 claimed small business status and won 156 licenses. 44 On May 21, 2007, the Commission completed an auction of 33 licenses in the A, C, and F Blocks in Auction No. 71. 45 Of the 12 winning bidders in that auction, five claimed small business status and won 18 licenses. 46 On August 20, 2008, the Commission completed the auction of 20 C-, D-, E-, and F-Block Broadband PCS licenses in Auction No. 78. 47 Of the eight winning bidders for Broadband PCS licenses in that auction, six claimed small business status and won 14 licenses. 48

Narrowband Personal Communications Services. To date, two auctions of narrowband personal communications services (PCS) licenses have been conducted. For purposes of the two auctions that have already been held, “small businesses” were entities with average gross revenues for the prior three calendar years of $40 million or less. Through these auctions, the Commission has awarded a total of 41 licenses, out of which 11 were obtained by small businesses. To ensure meaningful participation of small business entities in future auctions, the Commission has adopted a two-tiered small business size standard in the Narrowband PCS Second Report and Order . 49 A “small business” is an entity that, together with affiliates and controlling interests, has average gross revenues for the three preceding years of not more than $40 million. A “very small business” is an entity that, together with affiliates and controlling interests, has average gross revenues for the three preceding years of not more than $15 million. The SBA has approved these small business size standards. 50

Rural Radiotelephone Service. The Commission has not adopted a size standard for small businesses specific to the Rural Radiotelephone Service. A significant subset of the Rural Radiotelephone Service is the Basic Exchange Telephone Radio System (“BETRS”). In the present context, the Commission uses the SBA's small business size standard applicable to Wireless Telecommunications Carriers (except Satellite), i.e., an entity employing no more than 1,500 persons. 51 There are approximately 1,000 licensees in the Rural Radiotelephone Service, and the Commission estimates that there are 1,000 or fewer small entity licensees in the Rural Radiotelephone Service that may be affected by the rules and policies adopted herein.

Wireless Communications Services. This service can be used for fixed, mobile, radiolocation, and digital audio broadcasting satellite uses in the 2305-2320 MHz and 2345-2360 MHz bands. The Commission defined “small business” for the wireless communications services (WCS) auction as an entity with average gross revenues of $40 million for each of the three preceding years, and a “very small business” as an entity with average gross revenues of $15 million for each of the three preceding years. 52 The SBA has approved these definitions. 53 The Commission auctioned geographic area licenses in the WCS service. In the auction, which commenced on April 15, 1997 and closed on April 25, 1997, there were seven bidders that won 31 licenses that qualified as very small business entities, and one bidder that won one license that qualified as a small business entity.

220 MHz Radio Service—Phase I Licensees. The 220 MHz service has both Phase I and Phase II licenses. Phase I licensing was conducted by lotteries in 1992 and 1993. There are approximately 1,515 such non-nationwide licensees and four nationwide licensees currently authorized to operate in the 220 MHz band. The Commission has not developed a small business size standard for small entities specifically applicable to such incumbent 220 MHz Phase I licensees. To estimate the number of such licensees that are small businesses, the Commission applies the small business size standard under the SBA rules applicable. The SBA has deemed a wireless business to be small if it has 1,500 or fewer employees. 54 For this service, the SBA uses the category of Wireless Telecommunications Carriers (except Satellite). Census data for 2007, which supersede data contained in the 2002 Census, show that there were 1,383 firms that operated that year. 55 Of those 1,383, 1,368 had fewer than 100 employees, and 15 firms had more than 100 employees. Thus under this category and the associated small business size standard, the majority of firms can be considered small.

220 MHz Radio Service—Phase II Licensees. The 220 MHz service has both Phase I and Phase II licenses. The Phase II 220 MHz service is a new service, and is subject to spectrum auctions. In the 220 MHz Third Report and Order, the Commission adopted a small business size standard for defining “small” and “very small” businesses for purposes of determining their eligibility for special provisions such as bidding credits and installment payments. 56 This small business standard indicates that a “small business” is an entity that, together with its affiliates and controlling principals, has average gross revenues not exceeding $15 million for the preceding three years. 57 A “very small business” is defined as an entity that, together with its affiliates and controlling principals, has average gross revenues that do not exceed $3 million for the preceding three years. 58 The SBA has approved these small size standards. 59 Auctions of Phase II licenses commenced on and closed in 1998. 60 In the first auction, 908 licenses were auctioned in three different-sized geographic areas: Three nationwide licenses, 30 Regional Economic Area Group (EAG) Licenses, and 875 Economic Area (EA) Licenses. Of the 908 licenses auctioned, 693 were sold. 61 Thirty-nine small businesses won 373 licenses in the first 220 MHz auction. A second auction included 225 licenses: 216 EA licenses and 9 EAG licenses. Fourteen companies claiming small business status won 158 licenses. 62 A third auction included four licenses: 2 BEA licenses and 2 EAG licenses in the 220 MHz Service. No small or very small business won any of these licenses. 63 In 2007, the Commission conducted a fourth auction of the 220 MHz licenses. 64 Bidding credits were offered to small businesses. A bidder with attributed average annual gross revenues that exceeded $3 million and did not exceed $15 million for the preceding three years (“small business”) received a 25 percent discount on its winning bid. A bidder with attributed average annual gross revenues that did not exceed $3 million for the preceding three years received a 35 percent discount on its winning bid (“very small business”). Auction 72, which offered 94 Phase II 220 MHz Service licenses, concluded in 2007. 65 In this auction, five winning bidders won a total of 76 licenses. Two winning bidders identified themselves as very small businesses won 56 of the 76 licenses. One of the winning bidders that identified themselves as a small business won 5 of the 76 licenses won.

Wireless Telephony. Wireless telephony includes cellular, personal communications services, and specialized mobile radio telephony carriers. As noted, the SBA has developed a small business size standard for Wireless Telecommunications Carriers (except Satellite). 66 Under the SBA small business size standard, a business is small if it has 1,500 or fewer employees. 67 According to Trends in Telephone Service data, 413 carriers reported that they were engaged in wireless telephony. 68 Of these, an estimated 261 have 1,500 or fewer employees and 152 have more than 1,500 employees. 69 Therefore, more than half of these entities can be considered small.

Satellite Telecommunications Providers. Two economic census categories address the satellite industry. The first category has a small business size standard of $15 million or less in average annual receipts, under SBA rules. 70 The second has a size standard of $25 million or less in annual receipts. 71

The category of Satellite Telecommunications “comprises establishments primarily engaged in providing telecommunications services to other establishments in the telecommunications and broadcasting industries by forwarding and receiving communications signals via a system of satellites or reselling satellite telecommunications.”  72 Census Bureau data for 2007 show that 512 Satellite Telecommunications firms that operated for that entire year. 73 Of this total, 464 firms had annual receipts of under $10 million, and 18 firms had receipts of $10 million to $24,999,999. 74 Consequently, the Commission estimates that the majority of Satellite Telecommunications firms are small entities that might be affected by our action.

The second category, i.e., “All Other Telecommunications,” comprises “establishments primarily engaged in providing specialized telecommunications services, such as satellite tracking, communications telemetry, and radar station operation. This industry also includes establishments primarily engaged in providing satellite terminal stations and associated facilities connected with one or more terrestrial systems and capable of transmitting telecommunications to, and receiving telecommunications from, satellite systems. Establishments providing Internet services or Voice over Internet Protocol (VoIP) services via client-supplied telecommunications connections are also included in this industry.”  75 For this category, Census Bureau data for 2007 show that there were a total of 2,383 firms that operated for the entire year. 76 Of this total, 2,346 firms had annual receipts of under $25 million and 37 firms had annual receipts of $25 million to $49, 999,999. 77 Consequently, the Commission estimates that the majority of All Other Telecommunications firms are small entities that might be affected by our action.

Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing. The Census Bureau defines this category as follows: “This industry comprises establishments primarily engaged in manufacturing radio and television broadcast and wireless communications equipment. Examples of products made by these establishments are: Transmitting and receiving antennas, cable television equipment, GPS equipment, pagers, cellular phones, mobile communications equipment, and radio and television studio and broadcasting equipment.”  78 The SBA has developed a small business size standard for firms in this category, which is: All such firms having 750 or fewer employees. 79 According to Census Bureau data for 2010, there were a total of 810 establishments in this category that operated for the entire year. 80 Of this total, 787 had employment of fewer than 500, and an additional 23 had employment of 500 to 999. 81 Thus, under this size standard, the majority of firms can be considered small.

Semiconductor and Related Device Manufacturing. These establishments manufacture “computer storage devices that allow the storage and retrieval of data from a phase change, magnetic, optical, or magnetic/optical media. The SBA has developed a small business size standard for this category of manufacturing; that size standard is 500 or fewer employees' storage and retrieval of data from a phase change, magnetic, optical, or magnetic/optical media.”  82 According to data from the 2007 U.S. Census, in 2007, there were 954 establishments engaged in this business. Of these, 545 had from 1 to 19 employees; 219 had from 20 to 99 employees; and 190 had 100 or more employees. 83 Based on this data, the Commission concludes that the majority of the businesses engaged in this industry are small.

Software Publishers. Since 2007 these services have been defined within the broad economic census category of Custom Computer Programming Services; that category is defined as establishments primarily engaged in writing, modifying, testing, and supporting software to meet the needs of a particular customer. The SBA has developed a small business size standard for this category, which is annual gross receipts of $25 million or less. According to data from the 2007 U.S. Census, there were 41,571 establishments engaged in this business in 2007. Of these, 40,149 had annual gross receipts of less than $10,000,000. Another 1,422 establishments had gross receipts of $10,000,000 or more. Based on this data, the Commission concludes that the majority of the businesses engaged in this industry are small.

Internet Service Providers. Since 2007, these services have been defined within the broad economic census category of Wired Telecommunications Carriers; that category is defined as follows: “This industry comprises establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired telecommunications networks. Transmission facilities may be based on a single technology or a combination of technologies.”  84 The SBA has developed a small business size standard for this category, which is: All such firms having 1,500 or fewer employees. 85 According to Census Bureau data for 2007, there were 3,188 firms in this category, total, that operated for the entire year. 86 Of this total, 3,144 firms had employment of 999 or fewer employees, and 44 firms had employment of 1000 employees or more. 87 Thus, under this size standard, the majority of firms can be considered small. In addition, according to Census Bureau data for 2007, there were a total of 396 firms in the category Internet Service Providers (broadband) that operated for the entire year. 88 Of this total, 394 firms had employment of 999 or fewer employees, and two firms had employment of 1000 employees or more. 89 Consequently, the Commission estimates that the majority of these firms are small entities that may be affected by rules adopted pursuant to the R&O .

Internet Publishing and Broadcasting and Web Search Portals. The Commission's action may pertain to interconnected Voice over Internet Protocol (VoIP) services, which could be provided by entities that provide other services such as email, online gaming, web browsing, video conferencing, instant messaging, and other, similar IP-enabled services. The Commission has not adopted a size standard for entities that create or provide these types of services or applications. However, the Census Bureau has identified firms that “primarily engaged in (1) publishing and/or broadcasting content on the Internet exclusively or (2) operating Web sites that use a search engine to generate and maintain extensive databases of Internet addresses and content in an easily searchable format (and known as Web search portals).”  90 The SBA has developed a small business size standard for this category, which is: All such firms having 500 or fewer employees. 91 According to Census Bureau data for 2007, there were 2,705 firms in this category that operated for the entire year. 92 Of this total, 2,682 firms had employment of 499 or fewer employees, and 23 firms had employment of 500 employees or more. 93 Consequently, the Commission estimates that the majority of these firms are small entities that may be affected by rules adopted pursuant to the R&O .

All Other Information Services. The Census Bureau defines this industry as including “establishments primarily engaged in providing other information services (except news syndicates, libraries, archives, Internet publishing and broadcasting, and Web search portals).”  94 The Commission's action pertains to interconnected VoIP services, which could be provided by entities that provide other services such as email, online gaming, web browsing, video conferencing, instant messaging, and other, similar IP-enabled services. The SBA has developed a small business size standard for this category; that size standard is $7.0 million or less in average annual receipts. 95 According to Census Bureau data for 2007, there were 367 firms in this category that operated for the entire year. 96 Of these, 334 had annual receipts of under $5.0 million, and an additional 11 firms had receipts of between $5 million and $9,999,999. 97 Consequently, the Commission estimates that the majority of these firms are small entities that may be affected by our action.

All Other Telecommunications. The Census Bureau defines this industry as including “establishments primarily engaged in providing specialized telecommunications services, such as satellite tracking, communications telemetry, and radar station operation. This industry also includes establishments primarily engaged in providing satellite terminal stations and associated facilities connected with one or more terrestrial systems and capable of transmitting telecommunications to, and receiving telecommunications from, satellite systems. Establishments providing Internet services or Voice over Internet Protocol (VoIP) services via client-supplied telecommunications connections are also included in this industry.”  98 The SBA has developed a small business size standard for this category; that size standard is $30.0 million or less in average annual receipts. 99 According to Census Bureau data for 2007, there were 2,383 firms in this category that operated for the entire year. 100 Of these, 2,305 establishments had annual receipts of under $10 million and 84 establishments had annual receipts of $10 million or more. 101 Consequently, the Commission estimates that the majority of these firms are small entities that may be affected by our action.

In the R&O, the Commission amends its part 20 rules to require CMRS providers and certain interconnected text providers to implement “bounce-back” messages when a consumer attempts to text 911 in an area where text-to-911 is unavailable. Specifically, the rules apply to all CMRS providers as well as all providers of interconnected text messaging services that enable consumers to send text messages to and receive text messages from all or substantially all text-capable U.S. telephone numbers, including through the use of applications downloaded or otherwise installed on mobile phones. The rules also require covered text providers that are delivering texts to PSAPs that are supporting text-to-911 to provide a mechanism for the PSAP to request temporary suspension of text for any reason, including but not limited to network congestion, call-taker overload, PSAP failure, or security breach. In those circumstances, the covered text provider must provide a bounce-back message to any consumer attempting to send a text to 911 in the area covered by the temporary suspension. Covered text providers must also provide a mechanism to allow PSAPs to resume text-to-911 service after such temporary suspension.

The projected compliance requirements resulting from the R&O will apply to all entities in the same manner. The Commission believes that applying the same rules equally to all entities in this context is necessary to alleviate potential consumer confusion from adopting different rules for different providers. As the nation transitions to full text-to-911, it is critical that all consumers, including consumers of services offered by small entities, be made aware of the limitations of text-to-911 in their area. The Commission believes, and the record in this proceeding confirms, that the costs and/or administrative burdens associated with the rules will not unduly burden small entities.

Compliance costs for the new rule will be small, requiring only minor coding and/or server changes. Based on the record, CMRS providers and interconnected text providers have agreed that these changes are technically and financially feasible, with small costs to the covered provider. Additionally, the Commission provides an example of language that covered providers may use to satisfy the bounce-back requirement, further reducing potential administrative, legal and technical costs of compliance.

The RFA requires an agency to describe any significant, specifically small business alternatives that it has considered in reaching its proposed approach, which may include the following four alternatives (among others): “(1) the establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance or reporting requirements under the rule for small entities; (3) the use of performance, rather than design, standards; and (4) an exemption from coverage of the rule, or any part thereof, for small entities. ” 102

Based on the Commission's review of the record, the Commission finds that it is practicable for all CMRS providers, including small providers, to implement a bounce-back notification without incurring unduly burdensome costs. The record also reflects that it would not be unduly burdensome for covered text providers to implement bounce-back capability. 103 The record in this proceeding indicates that some service providers, including small or rural providers, 104 as well as covered text providers, 105 already send an automatic bounce-back message to their subscribers when a subscriber attempts to send a text to 911. The R&O recognizes the technical and operational issues that must be addressed before imposing a specific notification requirement, and allows time for implementation of a standardized message.

In considering the record received in response to the FNPRM, the Commission examined alternatives to ease the burden on small and rural covered text providers. These alternatives included extending the implementation deadline, or exempting small and rural covered text providers. However, the record in this proceeding indicates that the technical and financial costs for implementing bounce-back messages are small. Many small carriers have argued that they can meet the requirements imposed in this R&O on a faster timeline than the one established in the rules. For example, the Competitive Carriers Association (CCA), which represents many small and rural CMRS providers, states that, “. . . based on recent business developments cultivated by CCA and its members, most CCA carrier members will now be able to implement a bounce-back message by June 30, 2013. ” 106 Nonetheless, in order to further ease the burden on small and rural covered providers, the rules the Commission adopts in the R&O extend the deadline proposed in the Further Notice of Proposed Rulemaking from June 30, 2013 to September 30, 2013. Additionally, the rules adopted in the R&O allow for certain limited exemptions in cases where it is technologically infeasible to implement a bounce-back message ( e.g., for certain handsets that are incapable of doing so).

Further, the R&O contains a detailed Cost-Benefit Analysis which finds that the life-saving public safety benefits of imposing a bounce-back requirement on covered text providers far outweigh the costs of such a rule.

Finally, in the event that small entities face unique circumstances with respect to these rules, such entities may request waiver relief from the Commission. Accordingly, the Commission finds that it has discharged its duty to consider the burdens imposed on small entities.

The legal basis for any action that may be taken pursuant to this R&O is contained in Sections 1, 4(i), 301, 303(b), 303(r), 307, 309, 316, 319, 324, 332, 333, 615a, 615a-1, and 615b of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 301, 303(b), 303(r), 307, 309, 316, 319, 324, 332, 333, 615a, 615a-1, 615b, and 47 U.S.C. 615c.

None.

For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR part 20 as follows:

NMFS and the Council manage the Gulf reef fish fishery under the FMP. The Council prepared the FMP and NMFS implements the FMP through regulations at 50 CFR part 622 under the authority of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act).

On April 4, 2013, NMFS published a proposed rule for the framework action and requested public comment (78 FR 20292). The proposed rule and the framework action outline the rationale for the actions contained in this final rule. A summary of the actions implemented by this final rule is provided below.

Through this final rule, NMFS sets the 2013 commercial quota at 4.315 million lb (1.957 million kg), round weight, and the 2013 recreational quota at 4.145 million lb (1.880 million kg), round weight. NMFS also sets the 2013 red snapper recreational fishing season for Gulf Federal waters through this final rule.

Under 50 CFR 622.34(b), the red snapper recreational fishing season opens each year on June 1 and closes when the recreational quota is projected to be reached. The bag limit for red snapper in Gulf exclusive economic zone (EEZ) is 2 fish, as specified in 50 CFR 622.38(b)(3). On March 25, 2013, NMFS implemented an emergency rule to authorize NMFS to set the closure date of the red snapper recreational fishing season in the EEZ off individual states (78 FR 17882). The closure dates off each Gulf state in that emergency rule were based on the recreational quota revision contained in this final rule and any state's inconsistent regulations. For 2013, Texas established a year-round season with a 4-fish bag limit, Louisiana established an 88-day season with a 3-fish bag limit, and Florida established a 44-day season with a 2-fish bag limit. Mississippi and Alabama did not implement inconsistent regulations in their state waters.

On May 7, 2013, the NMFS Southeast Fisheries Science Center provided the NMFS Southeast Regional Office with updated landings data for monitoring quotas and annual catch limits using data from the Marine Recreational Information Program (MRIP). These landings data included 2012 landings converted from the Marine Recreational Fisheries Statistics Survey Program (MRFSS) to MRIP. Prior to May 7, 2013, these data were not available for use in NMFS Southeast Regional Office's calculations, so MRFSS landings data were used to calculate the season lengths identified in the proposed rule. Because the new data are now available, NMFS re-calculated the projected 2013 red snapper recreational season lengths off each Gulf state using the 2012 landings data from MRIP instead of from MRFSS.

NMFS now uses MRIP to monitor landings and is considered to be the best scientific information available, consistent with National Standard 2 of the Magnuson-Stevens Act. National Standard 2 states that “conservation and management measures shall be based upon the best scientific information available.” MRIP has slowly been integrated into NMFS's recreational data monitoring program and has now replaced MRFSS completely.

In addition to using MRIP data, new information from Louisiana and Texas was used to calculate the red snapper recreational season closure dates. Louisiana provided in-season catch estimates from their quota monitoring program and Texas provided final landings for 2012. The previous closure estimates were based on projected Texas landings for 2012. This re-calculation of the red snapper recreational seasons results in additional fishing days for all 5 Gulf States compared to the tentative red snapper recreational seasons previously discussed in the proposed rule. Based on the regulations established by Texas, Louisiana, and Florida; landings data from MRIP; the new information provided by Louisiana and Texas; and the recreational quota being set by this rulemaking, the closure dates for the EEZ off each state, effective at 12:01 a.m., local time, are set as follows: Texas, June 18, 2013; Louisiana, June 25, 2013; Mississippi, July 5, 2013; Alabama, July 5, 2013; and Florida, June 27, 2013.

To determine these closure dates, NMFS analyzed the catch rates for each state. The method for calculating these dates can be found in SERO-LAPP-2013-02 at http://sero.nmfs.noaa.gov/sustainable_fisheries/gulf_fisheries/red_snapper/documents/pdfs/2013_red_snapper_emergency_regs.pdf. The amount each state's Federal season is shortened is contingent on estimates of landings when the Federal season is closed. The more a state exceeds its apportionment of the annual recreational quota, the more the Federal recreational season must be reduced in the Federal waters off that state to compensate for the overage. NMFS estimates catch rates on the order of 1.5 to 3 times greater than the current state water catch rates due to factors such as increasing catch rates and fish size, higher bag limits, weekend fishing, peak season fishing, increases in stock abundance, potentially significant levels of deliberate or accidental non-compliance by constituents with state/Federal boundaries during incompatible regulatory periods, and the fact that some for-hire vessels are not federally permitted and contribute to landings when the Federal season is closed. For the season projections, NMFS used 2 times the catch rate because using 1.5 times the catch rate would potentially be an underestimate and using 3 times the catch rate could be too conservative.

During the comment period, NMFS received 43 comments, including 36 from private citizens, 2 from recreational fishing organizations, 3 from a commercial fishing organization and 2 from environmental groups. Comments pertinent to the rule unanimously supported increasing the red snapper quota and did not raise any additional issues within the scope of this rulemaking. NMFS agrees with the commenters that the quota increases are appropriate actions, and are in accordance with the red snapper rebuilding plan.

Many of these same commenters provided additional observations and suggestions for alternative strategies to manage the recreational red snapper harvest, including changes to the bag limit and size limits, slot limits, alternative seasons, regional management, separate allocations for private anglers and the for-hire fleet, and reallocation of the quotas between the recreational and commercial sector. The Council has considered many of the suggested options in the past, and continues to consider alternative management options for the recreational harvest of red snapper. NMFS agrees that alternative recreational management strategies may prove to be viable options for the management of red snapper in the future; however, these comments and suggestions are beyond the scope of this rulemaking to increase the commercial and recreational quotas for red snapper for the 2013 fishing year, and thus will not be further addressed in this rule.

On April 17, 2013, NMFS published in the Federal Register an interim final rule to reorganize the regulations in 50 CFR part 622 for the Gulf of Mexico, South Atlantic, and the Caribbean (78 FR 22950). That interim final rule did not create any new rights or obligations; it reorganized the existing regulatory requirements in the Code of Federal Regulations into a new format. This final rule incorporates this new format into the regulatory text. Therefore, the commercial and recreational quotas for red snapper previously located in the regulatory text at § 622.42(a)(1)(i) and (a)(2)(i), respectively, are now located at § 622.39(a)(1)(i) and (a)(2)(i), respectively.

The Regional Administrator, Southeast Region, NMFS determined that this final rule and the framework action are necessary for the conservation and management of the Gulf reef fish fishery and are consistent with the Magnuson-Stevens Act and other applicable law.

This final rule has been determined to be not significant for purposes of Executive Order 12866.

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

The NOAA Assistant Administrator for Fisheries (AA) finds good cause under 5 U.S.C. 553(d)(3) to waive the 30-day delay in effectiveness of the management measures contained in this final rule. A 30-day delay in effectiveness of the final rule is impracticable because the recreational fishing season for red snapper begins on June 1, and therefore, there is not enough time for NMFS to provide both notice and comment on the proposed rule and a 30-day delay in effectiveness on the final rule, before the season starts. This final rule implements increased commercial and recreational quotas for Gulf red snapper based on the increase in the acceptable biological catch (ABC) from 8.08 million lb (3.67 million kg) to 8.46 million lb (3.83 million kg), round weight, as recommended by the Council's Science and Statistical Committee (SSC). The SSC met in November 2012 to review new scientific information and recommended an increased ABC for 2013. At its February 2013 Council meeting, the Council voted to implement commercial and recreational quota increases in 2013 based on the ABC recommended by the SSC. Increased quotas will allow additional harvest of red snapper and will provide the opportunity for the fishery to achieve optimum yield. Additionally, NMFS received new scientific information on May 7, 2013, to use to update and extend the red snapper recreational seasons. The new data included 2012 landings converted from MRFSS to MRIP. Prior to May 7, 2013, these data were not available, so MRFSS landings data were used to calculate the season lengths identified in the proposed rule. Because the new data are now available, NMFS re-calculated the projected 2013 red snapper recreational season lengths off each Gulf state using the 2012 landings data from MRIP instead of from MRFSS, which is the best scientific information now available. Because the recreational fishing season begins on June 1, there isn't enough time for NMFS to provide both notice and comment on the proposed rule and a 30-day delay in effectiveness on the final rule. Therefore, NMFS provided the opportunity for notice and comment on the proposed rule, but is waiving the 30-day delay in effectiveness on this final rule.

In addition, a 30-day delay in effectiveness of this final rule would be contrary to the public interest. If this rule is not effective immediately, and the recreational fishing season closure dates cannot be implemented immediately, the recreational ACL could be exceeded and overfishing of the red snapper resource could occur. The recreational closure date off Texas has been set for 12:01 a.m., local time, June 18, 2013; the recreational closure date off Louisiana has been set for 12:01 a.m., local time, June 25, 2013; and the recreational closure date off Florida has been set for 12:01 a.m., local time, June 27, 2013. If this rule were effective 30 days after publication, these closure dates could not be implemented and recreational fishing off these states would continue to occur. Additional fishing off these states could lead to the recreational ACL being exceeded which could lead to an overfishing situation. This would be in violation of National Standard 1 of the Magnuson-Stevens Act. National Standard 1 states that “management measures shall prevent overfishing while achieving, on a continuing basis, the optimum yield from each fishery . . .” The red snapper stock is still overfished and under a rebuilding plan through 2032. The next SEDAR benchmark stock assessment is currently undergoing. To keep red snapper on the rebuilding plan and prevent overfishing from occurring, this rule needs to take effect immediately.

For these reasons, the AA waives the 30-day delay in effectiveness of this final rule.

For the reasons set out in the preamble, 50 CFR part 622 is amended as follows:

Precious corals (also called deep-sea corals), including gold corals, are used in high-quality jewelry. NMFS and the Council manage precious corals under fishery ecosystem plans for American Samoa, Hawaii, the Mariana Islands (Guam and the Northern Mariana Islands), and the U.S. Pacific Remote Island Areas. On September 12, 2008, NMFS established a 5-year moratorium on the harvest of gold corals in U.S. Pacific Islands (73 FR 47098). The moratorium was based on information that gold corals grew much more slowly and lived longer than previously thought, suggesting that these species were vulnerable to overharvest. NMFS and the Council intended the harvest moratorium to encourage research into gold coral biology and prevent overfishing.

Subsequent research found that gold corals in the U.S. Pacific Islands grow about 0.22 cm annually and the average colony age is about 950 years. These findings confirmed previous assumptions about gold corals' vulnerability to overharvesting. Additionally, researchers found that gold corals may also rely on the presence of bamboo coral. Gold coral larvae may require bamboo coral colonies as a growth substrate, attaching themselves to the host colony and eventually overgrowing it to form a new gold coral colony. This final rule is necessary to encourage more research into gold coral biology and to develop sustainable management measures.

This final rule extends the moratorium on harvesting gold corals in the U.S. Pacific Islands through June 30, 2018. Additional information on this final rule may be found in the preamble to the proposed rule (78 FR 18302) and is not repeated here.

On March 26, 2013, NMFS published a proposed rule and request for public comments (78 FR 18302); the comment period ended April 25, 2013. NMFS received one comment that generally supported the proposed rule, and no comments to the contrary.

This final rule contains no changes from the proposed rule.

The Regional Administrator, Pacific Islands Region, NMFS, has determined that this final rule is necessary for the conservation and management of Pacific Island gold coral fisheries, and that it is consistent with the Magnuson-Stevens Fishery Conservation and Management Act and other applicable laws.

This final rule has been determined to be not significant for purposes of Executive Order 12866.

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

For the reasons set out in the preamble, NMFS amends 50 CFR part 665 as follows: