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U.S. Office of Personnel Management.
Final rule.
The United States Office of Personnel Management (OPM) is issuing a final rule to amend the Federal Employees Health Benefits Program (FEHB) regulations regarding coverage for children up to age 26. The regulations also allow children of same-sex domestic partners living in states that do not allow same-sex couples to marry to be covered family members under the FEHB and the Federal Employees Dental and Vision Insurance Program (FEDVIP).
This final rule is effective beginning January 1, 2014.
Rachel Royster, Program Analyst,
On July 20, 2012, OPM published proposed regulations in the
As explained in the proposed rule, this regulation: (1) Brings FEHB rules into compliance with changes to health insurance coverage for children under the Patient Protection and Affordable Care Act, Public Law 111-148, as amended by the Health Care and Education Reconciliation Act, Public Law 111-152 (the Affordable Care Act); (2) extends FEHB and FEDVIP benefits to children of same-sex domestic partners of Federal employees who live in states that do not allow same-sex couples to marry, consistent with Presidential Memoranda issued on June 17, 2009, and June 2, 2010; (3) makes other non-substantive, technical conforming amendments to the FEDVIP rules, which reference current FEHB rules that are being amended by this rule; and (4) updates the Federal Flexible Benefits Plan: Pre-Tax Payment of Health Benefits Premiums (Part 892) rules to reflect the above-referenced changes required by the Affordable Care Act and to implement changes in connection with the extension of FEHB coverage to children of same-sex domestic partners of Federal employees.
We received 17 comments on the proposed rule, with a majority relating to the extension of coverage to children of same-sex domestic partners under the FEHB Program and FEDVIP. A majority of commenters (about 3 to 1) supported extending coverage to children of same-sex domestic partners. Other comments and OPM's responses are detailed below. One comment related to the requirement that money deposited in a flexible spending account be forfeited if eligible expenses are not incurred within the timeframe specified by the Internal Revenue Service (IRS). That issue is outside of the scope of this proposed rule and is therefore not addressed below.
It should be noted that, as an alternative to adding a definition of the term “stepchild,” OPM also considered including in the regulation a new category of child—the child of a same-sex domestic partner—that would have expanded upon the examples of types of children that Congress provided in the statute (e.g., adopted child, recognized natural child, stepchild and foster child). While there are a number of approaches that would have been reasonable, OPM chose the approach of adding a definition of the term “stepchild” because this nomenclature specifically recognizes the parent-child relationship between the employee (annuitant)/parent and the child.
Although the comment that this regulation violates DOMA is no longer relevant in light of the Supreme Court's June 26, 2013 decision striking down Section 3 of DOMA as unconstitutional, it is important to emphasize that this regulation was not in violation of Section 3 of DOMA even while that provision was in force. Section 3 of DOMA limited the meaning of the terms “marriage” and “spouse,” when used in Federal laws. Through this regulation, OPM has expanded its definition of the term “stepchild” with respect to the provision of healthcare benefits for children. Consequently, Section 3 of DOMA simply had no bearing on this regulation, and these recommended changes were always within the purview of OPM's discretion. Finally, as explained in the proposed rule and as explained in greater detail below, the change is consistent with Executive Order 13563 and President Obama's memoranda of June 17, 2009, and June 2, 2010.
Now that FEHB and FEDVIP coverage is available to the children of an employee's same-sex spouse, OPM has reconsidered the need and scope of the proposed rule to extend benefits to the children of same-sex domestic partners. Although there are arguments that could support a decision by OPM to move ahead with the uniform, national rule originally contemplated in the proposed regulation, OPM has decided to limit this regulation to those same-sex couples living in states where marriage is not available to them.
Only a minority of states currently permits same-sex marriage, and therefore, many same-sex couples do not have the same access to marriage that is available to opposite-sex couples. Until marriage is available to same-sex couples in all fifty states, the extension of benefits to same-sex domestic partners will continue to play an important role in bridging the gap in legal treatment between same-sex and opposite-sex couples.
For these reasons, this proposed regulation to provide FEHB and FEDVIP benefits to the stepchildren of same-sex domestic partners will not be withdrawn in whole, but instead will be tailored to those couples who are unable to marry under the laws of the state in which they reside.
Same-sex couples living in states that allow them to marry have access to many, if not all, of the protections that married opposite-sex couples enjoy. Therefore, for employees living in states where they are able to marry, there is less need to create a separate path by which stepchildren of Federal employees can be deemed eligible for coverage under FEHB and FEDVIP. For those employees unable to marry under the laws of the states in which they live, however, it is appropriate to extend FEHB and FEDVIP eligibility to stepchildren, albeit in a potentially non-tax preferred manner, in the form described in this regulation.
We recognize that the legal landscape is rapidly changing, and certain states that currently do not allow same-sex couples to marry may soon allow them to do so. Same-sex couples may also relocate from states where they cannot marry to states where they are permitted to marry. The possibility that the relevant state marriage laws may change mid-year has the potential to create significant administrative difficulties. For this reason, eligibility for FEHB and FEDVIP coverage will be determined once annually, and will depend on whether an enrollee seeking to cover the child of his or her same-sex domestic partner lives in a state that authorizes same-sex marriage as of the last day prior to Open Season for enrollment in benefits for the following year. An otherwise eligible stepchild whose parents lived in a state that did not permit them to marry prior to the commencement of Open Season will remain eligible to receive those benefits
Nothing in this regulation changes the rules that otherwise apply when an enrollee experiences a qualifying life event, including marriage. See OPM Benefits Administration Letter 13-203 (clarifying that same-sex couples who marry after June 26, 2013, have 60 days after the marriage to change their FEHB enrollment). OPM will issue guidance to clarify, among other things, how enrollees should inform their employing agency if a child they were covering under a FEHB Self and Family enrollment or a FEDVIP Self Plus One or Self and Family enrollment pursuant to this regulation, and for whom the value of the benefit was not tax preferred, becomes a stepchild who is the child of the enrollee's spouse, thus eliminating the need to impute the value of the benefit to their income.
Finally, with respect to the suggestion regarding civil unions, domestic partnership or other non-marital relationship, the fact that an employee may be in a state-created relationship with the child's other parent other than a marriage will not render the child eligible for coverage as a stepchild under the FEHB or FEDVIP. Therefore, requiring employees to enter into one of these other relationship statuses where available is not appropriate.
In the proposed rule, OPM also requested comments on how, in the case of the provision of FEHB coverage to the child of a same-sex domestic partner who does not qualify for favorable tax treatment under the Internal Revenue Code, the fair market value (FMV) of that coverage might be calculated for different types of plan coverage. Several commenters suggested methods for calculating the FMV.
Two commenters suggested using the methodology in Private Letter Ruling 9603011, where the FMV is the difference between the Self and Family premium and the Self Only premium for the selected plan, net of employee contributions. One commenter suggested that this is a preferable method because it is calculated from information that is publicly available and does not require complicated actuarial calculations on the part of the FEHB Program carrier. One commenter suggested that OPM may calculate FMV using the difference between the actuarial value of insurance for a single person and that of insurance for a couple or family. One commenter suggested that OPM use the actual premium cost the Federal Government would have paid if the child was not included in the policy, despite this method being opposed by the IRS in some private letter rulings. Several commenters suggested that OPM consider actuarial studies and data to ensure that an accurate FMV is determined.
OPM appreciates the input from commenters on how to determine FMV for coverage of children of domestic partners. OPM plans to provide, in the form of guidance to agencies, the FMV calculation for each FEHB plan for those who wish to cover children of domestic partners in a Self and Family enrollment (and for FEDVIP plans for those covering such children under a Self Plus One or Self and Family enrollment) where the children are not eligible for favorable tax treatment as a dependent. This calculation will be available to Federal agencies, payroll offices and enrollees annually, beginning for plan year 2014.
OPM has examined the impact of this rule as required by Executive Order 12866 (September 1993, Regulatory Planning and Review) and Executive Order 13563, which directs agencies to assess all 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). A regulatory impact analysis must be prepared for major rules with economically significant effects of $100 million or more in any one year. I certify that this regulation will not have a significant economic impact because the regulation only adds a small additional group of children to the list of groups eligible for coverage under FEHB and FEDVIP.
Administrative practice and procedure, Government employees, Health facilities, Health insurance, Health professions, Hostages, Iraq, Kuwait, Lebanon, Military personnel, Reporting and recordkeeping requirements, Retirement.
Administrative practice and procedure, Government employees, Health insurance, Taxes, Wages.
Administrative practice and procedure, Government employees, Health insurance, Taxes, Wages
Accordingly, OPM is amending 5 CFR chapter I as follows:
5 U.S.C. 8913; Sec. 890.301 also issued under sec. 311 of Pub. L. 111-03, 123 Stat. 64; Sec. 890.111 also issued under section 1622(b) of Pub. L. 104-106, 110 Stat. 521; Sec. 890.112 also issued under section 1 of Pub. L. 110-279, 122 Stat. 2604; 5 U.S.C. 8913; Sec. 890.803 also issued under 50 U.S.C. 403p, 22 U.S.C. 4069c and 4069c-1; subpart L also issued under sec. 599C of Pub. L. 101-513, 104 Stat. 2064, as amended; Sec. 890.102 also issued under sections 11202(f), 11232(e), 11246 (b) and (c) of Pub. L. 105-33, 111 Stat. 251; and section 721 of Pub. L. 105-261, 112 Stat. 2061.
(a)(1) An enrollment for self and family includes all family members who are eligible to be covered by the enrollment. Except as provided in paragraph (a)(2) of this section, no employee, former employee, annuitant, child, or former spouse may enroll or be covered as a family member if he or she is already covered under another person's self and family enrollment in the FEHB Program.
(2)
(ii)
(A) To protect the interests of married or legally separated Federal employees, annuitants and their children, an employee or annuitant may enroll in his or her own right in a self only or self and family enrollment, as appropriate, even though his or her spouse also has a self and family enrollment if the employee, annuitant or his or her children live apart from the spouse and would otherwise not have access to coverage due to a service area restriction and the spouse refuses to change health plans.
(B) When an employee who is under age 26 and covered under a parent's self and family enrollment acquires an eligible family member, the employee may elect to enroll for self and family coverage.
(iii) Children are entitled to receive benefits under only one enrollment regardless of whether the children qualify as family members under the enrollment of both parents or of a parent and a stepparent and regardless of whether the parents are married, unmarried, divorced, legally separated, or in a domestic partnership. To ensure that no person receives benefits under more than one enrollment, each enrollee must promptly notify the insurance carrier as to which family members will be covered under his or her enrollment. These individuals are not covered under the other enrollment.
(b)(1) A child under the age of 26, or a child of any age who is incapable of self-support because of a mental or physical disability which existed before age 26, is considered to be a family member eligible to be covered by the enrollment of an enrolled employee or annuitant or a former employee or child enrolled under § 890.1103 of this part if he or she is—
(i) A child born within marriage;
(ii) A recognized natural child;
(iii) An adopted child;
(iv) A stepchild; or
(v) A foster child.
(2)
(3)
(4)
(i) Are each other's sole domestic partner and intend to remain so indefinitely;
(ii) Maintain a common residence, and intend to continue to do so (or would maintain a common residence but for an assignment abroad or other employment-related, financial, or similar obstacle);
(iii) Are at least 18 years of age and mentally competent to consent to a contract;
(iv) Share responsibility for a significant measure of each other's financial obligations;
(v) Are not married or joined in a civil union to anyone else;
(vi) Are not a domestic partner of anyone else;
(vii) Are not related in a way that, if they were of opposite sex, would prohibit legal marriage in the U.S. jurisdiction in which the domestic partnership was formed;
(viii) Provide documentation demonstrating fulfillment of the requirements of paragraphs (b)(4)(i) through (vii) of this section as prescribed by OPM; and
(ix) Certify that they understand that willful falsification of the documentation described in paragraph (b)(4)(viii) of this section may lead to disciplinary action and the recovery of the cost of benefits received related to such falsification and may constitute a criminal violation under 18 U.S.C. 1001.
(x) Certify that they would marry but for the failure of their state of residence to permit same-sex marriage.
(5) Notwithstanding the provisions of paragraph (b)(2) of this section, the child of an enrollee and a domestic partner who otherwise meet the requirements of paragraphs (b)(4)(i) through (viii) of this section but live in a state that has authorized marriage by same-sex couples prior to the first day of Open Season, shall not be considered a stepchild who is the child of a domestic partner in the following plan year. The determination of whether a state's marriage laws render a child ineligible for coverage as a stepchild who is the child of a domestic partner shall be made once annually, based on the law of the state where the same-sex couple lives on the last day before Open Season begins for the following plan year. A child's eligibility for coverage as a stepchild who is the child of a domestic partner in a particular plan year shall not be affected by a mid-year change to a state's marriage law or by the couple's relocation to a different state. For mid-year enrollment changes involving the addition of a new stepchild, as defined by this regulation, outside of Open Season, the determination of whether a state's marriage laws render the child ineligible for coverage shall be made at the time the employee notifies the employing office of his or her desire to cover the child.
(6)
(7)
(c)
(1) State that the child is incapable of self-support because of a physical or mental disability that existed before the child became 26 years of age and that can be expected to continue for more than 1 year;
(2) Include a statement of the name of the child, the nature of the disability, the period of time it has existed, and its probable future course and duration; and,
(3) Be signed by the physician and show the physician's office address. The employing office must require the enrollee to submit the certificate on or before the date the child becomes 26 years of age. However, the employing office may accept otherwise satisfactory evidence of incapacity that is not timely filed.
(d)
(e)
(2) Either the employing office or the carrier may make a determination of incapacity if a medical condition, as specified by OPM, exists that would cause a child to be incapable of self-support during adulthood.
(a)
(b) A child is considered to be the child of the former spouse or the employee, former employee, or employee annuitant if he or she is—
(1) A natural child; or
(2) An adopted child.
(c)
(1) A separation from Government service.
(2) A divorce or annulment.
(3) A change in circumstances that causes an individual to become ineligible to be considered a child who is a covered family member under this part.
(a) Except as provided by paragraph (b) of this section, individuals described by this section are eligible to elect temporary continuation of coverage under this subpart. Eligible individuals are as follows:
(2) Individuals whose coverage as children under the family enrollment of an employee, former employee, or annuitant ends because they cease meeting the requirements for being considered covered family members. For the purpose of this section, children who are enrolled under this part as survivors of deceased employees or annuitants are considered to be children under a family enrollment of an employee or annuitant at the time of the qualifying event.
(b) * * *
(2) If the notice described in paragraph (b)(1) of this section is received by the employing office within 60 days after the date on which the child ceased meeting the requirements for being considered a covered family member, the employing office must notify the child of his or her rights under this subpart within 14 days after receiving the notice.
(3) This paragraph does not preclude the employing office from notifying the child of his or her rights based on oral or written notification by the child, another family member, or any other source that the child no longer meets the requirements for being considered a covered family member.
(b)(1) Except as provided in paragraph (b)(2) of this section, in the case of individuals who are eligible for continued coverage under § 890.1103(a)(2), the temporary continuation of coverage ends on the date that is 36 months after the date the individual first ceases to meet the requirements for being considered a child who is a covered family member, unless it is terminated earlier under the provisions of § 890.1110.
(2) The temporary continuation of coverage ends on the date that is 36 months after the date of the separation from service on which the former employee's continuation of coverage is based, unless it is terminated earlier under the provisions of § 890.1110, in the case of individuals who—
(i) Are eligible for continued coverage under § 890.1103(a)(2); and
(ii) As of the day before ceasing to meet the requirements for being considered children who are covered family members, were covered family members of a former employee receiving continued coverage under this subpart; and
(iii) Cease meeting the requirements for being considered children who are covered family members before the end of the 18-month period specified in paragraph (a) of this section.
5 U.S.C. 8913; 5 U.S.C. 1103(a)(7); 26 U.S.C. 125; Sec. 892.101 also issued under sec. 311 of Pub. L. 111-3, 123 Stat. 64.
(1) * * *
(iii) Last dependent child loses coverage, for example, the child reaches age 26, disabled child becomes capable of self support, child acquires other coverage by court order; and * * *
* * * There is one exception, however. If your FEHB enrollment covers a stepchild who is the child of a domestic partner as defined in part 890 of this chapter, and that stepchild does not qualify for favorable tax treatment under applicable tax laws, then the portion of the allotted amount described above that represents the employee's contribution toward the fair market value of FEHB coverage provided to the child will be separately imputed to the employee as income and subject to applicable taxes.
(1) Birth of a child;
(2) Adoption of a child;
(3) Acquisition of a foster child as described in § 890.101(a)(8) of this chapter;
(4) Acquisition of a stepchild who lives with the enrollee in a regular parent-child relationship;
(5) Establishment of a recognized natural child;
(6) Residence change of the enrollee's stepchild or recognized natural child who moves in with the enrollee; and
(7) An otherwise eligible child becoming unmarried due to divorce or annulment of marriage, or death.
(1) Are each other's sole domestic partner and intend to remain so indefinitely;
(2) Maintain a common residence, and intend to continue to do so (or would maintain a common residence but for an assignment abroad or other employment-related, financial, or similar obstacle);
(3) Are at least 18 years of age and mentally competent to consent to a contract;
(4) Share responsibility for a significant measure of each other's financial obligations;
(5) Are not married or joined in a civil union to anyone else;
(6) Are not a domestic partner of anyone else;
(7) Are not related in a way that, if they were of opposite sex, would prohibit legal marriage in the U.S. jurisdiction in which the domestic partnership was formed;
(8) Provide documentation demonstrating fulfillment of the requirements of paragraphs (1) through (7) of this definition as prescribed by OPM; and
(9) Certify that they understand that willful falsification of the documentation described in paragraph (8) of this definition may lead to disciplinary action and the recovery of the cost of benefits received related to such falsification and may constitute a criminal violation under 18 U.S.C. 1001.
(10) Certify that they would marry but for the failure of their state of residence to permit same-sex marriage.
(11) Termination of Domestic Partnership. An enrollee or his or her domestic partner must notify the employing office within thirty calendar days in the event that any of the conditions listed in paragraphs (1) through (7) of this definition are no longer met, in which case a domestic partnership will be deemed terminated.
(1) Except as provided in paragraph (2) of this definition, the child of an enrollee's spouse or domestic partner and shall continue to refer to such child after the enrollee's divorce from the spouse, termination of the domestic partnership, or death of the spouse or domestic partner, so long as the child continues to live with the enrollee in a regular parent-child relationship.
(2) The child of an enrollee and a domestic partner who otherwise meet the requirements of paragraphs (1) through (8), set forth in the definition of Domestic Partnership, but live in a state that has authorized marriage by same-sex couples prior to the first day of Open Season, shall not be considered a stepchild who is the child of a domestic partner in the following plan year. The determination of whether a state's marriage laws render a child ineligible for coverage as a stepchild who is the child of a domestic partner shall be made once annually, based on the law of the state where the same-sex couple lives on the last day before Open Season begins for enrollment for the following year. A child's eligibility for coverage as a stepchild who is the child of a domestic partner in a particular plan year shall not be affected by a mid-year change to a state's marriage law or by the couple's relocation to a different state. For midyear enrollment changes involving the addition of a new stepchild, as defined by this regulation, outside of Open Season, the determination of whether a state's marriage laws render the child ineligible for coverage shall be made at the time the employee notifies the employing office of his or her desire to cover the child.
(a) Dependency is established for a recognized natural child who lives with the enrollee in a regular parent-child relationship, a recognized natural child for whom a judicial determination of support has been obtained, or a recognized natural child to whose support the enrollee makes regular and substantial contributions.
(b) The following are examples of proof of regular and substantial support. More than one of the following proofs may be required to show support of a recognized natural child who does not live with the enrollee in a regular parent-child relationship and for whom a judicial determination of support has not been obtained:
(1) Evidence of eligibility as a dependent child for benefits under other State or Federal programs;
(2) Proof of inclusion of the child as a dependent on the enrollee's income tax returns;
(3) Canceled checks, money orders, or receipts for periodic payments from the enrollee for or on behalf of the child.
(4) Evidence of goods or services which show regular and substantial contributions of considerable value;
(5) Any other evidence which OPM shall find to be sufficient proof of support or of paternity or maternity.
(a) * * * However, if your enrollment covers a stepchild who is the child of a domestic partner as defined in § 894.101, and that stepchild does not qualify for favorable tax treatment under applicable tax laws, the allotted amount of premium that represents the fair market value of the FEDVIP coverage provided to the stepchild will be separately imputed to the employee as income and subject to applicable taxes.
National Credit Union Administration (NCUA).
Final rule.
The NCUA Board (Board) is issuing a final rule to require federally insured credit unions (FICUs) with less than $50 million in assets to maintain a basic written policy that provides a credit union board-approved framework for managing liquidity and a list of contingent liquidity sources that can be employed under adverse circumstances. The rule requires FICUs with assets of $50 million or more to have a contingency funding plan that clearly sets out strategies for addressing liquidity shortfalls in emergency situations. Finally, the rule requires FICUs with assets of $250 million or more to have access to a backup federal liquidity source for emergency situations.
This rule is effective March 31, 2014.
Lisa Henderson, Staff Attorney, Office of General Counsel, (703) 518-6540; or J. Owen Cole, Jr., Director, Division of Capital and Credit Markets, Office of Examination and Insurance, (703) 518-6620.
The recent financial crisis demonstrated the importance of good liquidity risk management to the safety and soundness of financial institutions. Many institutions experienced significant financial stress because they did not manage their liquidity in a prudent manner. In some cases, these institutions had difficulty meeting their obligations as they became due because sources of funding became severely restricted. In the financial crisis, even institutions that were healthy used emergency federal liquidity facilities when funding costs became prohibitively high. At the time, the borrowing authority of NCUA's Central Liquidity Facility (CLF) was more than $40 billion, and it was able to play a significant role in making liquidity available to credit unions. Because of the 2012 closure of U.S. Central Credit Union and the redemption of most of its CLF stock, however, the CLF's borrowing authority has been reduced to just over $2 billion.
These events followed several years of ample liquidity. The rapid reversal in market conditions and availability of liquidity during the crisis illustrated how quickly liquidity can evaporate. This illiquidity can last for an extended period, leading to an institution's inability to meet its financial obligations and possibly its insolvency. Many of the liquidity-related difficulties experienced by financial institutions were due to lapses in basic principles of liquidity risk management. This rule will strengthen FICU liquidity risk management, which is crucial to ensuring the credit union system's resiliency during periods of financial market stress.
The 2012 proposed liquidity rule required FICUs with less than $10 million in assets to maintain a written liquidity policy, including a list of contingent liquidity sources.
NCUA received 45 comments on the proposed rule. More than half of the commenters urged that the rule not go forward, stating that NCUA had not justified a need for a liquidity regulation and that the guidance provided by the 2010 Interagency Policy Statement on Funding and Liquidity Risk Management (Policy Statement)
A number of commenters praised the three-tiered approach, although 12 suggested that the lower threshold should be raised to match NCUA's then-proposed amendment to the definition of “small entity.”
Several commenters seemed confused about the proposed requirement that FICUs with assets of $100 million or more have access to the CLF or Discount Window. Their comments suggested they believed the requirement meant that these larger credit unions would be prohibited from establishing other sources of liquidity. This is incorrect. As discussed in greater detail below, the Board encourages all FICUs to have multiple sources of liquidity.
Twenty-five commenters objected to the CLF's structure, specifically the required stock investment and the CLF's inability to guarantee same-day funding. The Board notes that the stock investment is required under the Federal Credit Union Act.
Eighteen commenters either opposed applying Basel III liquidity measures and monitoring tools to FICUs with assets over $500 million or suggested that NCUA proceed very slowly in considering such application.
After careful consideration of the comments, the Board has concluded that a liquidity rule is necessary to ensure that FICUs remain resilient in times of economic stress. It, therefore, is adopting as final a modified version of the 2012 proposed rule. As discussed in greater detail below, this final rule addresses concerns raised by the commenters. Accordingly, the Board is adding a new § 741.12 to part 741, titled “Liquidity and Contingency Funding Plans.” The Board believes that FICUs, relying on the guidance provided in the Policy Statement, generally have
The Board is retaining the tiered approach of the proposed rule and is continuing to base the tiers on asset size. The Board believes that, while there are exceptions, larger credit unions generally present greater exposure to the NCUSIF. The Board is, however, raising the triggering thresholds from those in the proposed rule.
Since the proposed rule was issued, the Board revised the definition of “small entity” from a credit union with less than $10 million in assets to one with less than $50 million in assets.
In response to comments, and to reduce regulatory burden, the Board is raising the highest threshold—requiring established access to a federal liquidity provider—from $100 million to $250 million. While the Board encourages FICUs with assets between $100 million and $250 million to have this access, the Board is not requiring it at this time.
The Board continues to believe that it is essential for every FICU, regardless of size and complexity, to have a management process for identifying, measuring, monitoring, and controlling liquidity risk that is commensurate with its respective needs. FICUs with less than $50 million in assets present relatively limited liquidity concerns, as they tend to have lower loan-to-share ratios, shorter duration assets, and higher amounts of balance sheet liquidity than larger credit unions. Accordingly, § 741.12(a) of the final rule requires these smaller FICUs to maintain a basic written policy that provides a credit union board-approved framework for managing liquidity and a list of contingent liquidity sources that can be employed under adverse circumstances. Such a policy establishes liquidity measures and associated benchmarks, a reporting requirement to keep the board apprised of the institution's liquidity position, and a contingent source, or sources, of funding, such as a corporate credit union or correspondent bank.
Section 741.12(b) requires any FICU with assets of at least $50 million to have a fully developed, written CFP that clearly sets out strategies for addressing liquidity shortfalls in emergency situations. In addition to the policy items required for smaller FICUs, a fully developed CFP also provides for evaluation of adverse liquidity scenarios, outlines specific actions to be taken and specific sources of liquidity in emergency liquidity events, and provides for periodic testing of contingent liquidity sources. Section 741.12(d) of the final rule details all of the requirements of a CFP. The Board is imposing greater requirements on these larger FICUs because of the critical importance of a well-developed CFP to the viability of these institutions and, ultimately, the safety of the NCUSIF.
In addition to the requirement to have a written CFP, § 741.12(c) of the final rule requires any FICU with assets of $250 million or more to ensure it has immediate, established access to either the CLF or the Discount Window. These larger credit unions have a greater degree of interconnectedness with other market entities. When they experience unexpected or severe liquidity circumstances, they are more likely to adversely affect the credit union system, public perception, and the NCUSIF.
The Board determined not to include FHLB membership as a federal contingency source for purposes of meeting the requirements of this rule. As discussed in the preamble to the proposed rule, FHLBs can be valuable contingency funding sources. However, while government sponsored, FHLBs are not federal facilities and are not obligated to meet emergency liquidity demands in the same way that the CLF and Discount Window are designed to do. The Board also declines to allow large FICUs to meet the requirements of the rule by holding a portfolio of marketable securities. While it is prudent for every FICU to have a cushion of highly liquid assets on its balance sheet, these assets have proven to be insufficient in a crisis.
The Board emphasizes that all FICUs should have access to multiple sources of funding, from both their own balance sheets and through market funding sources. In requiring the largest FICUs to have established access to the CLF or the Discount Window, the Board is not suggesting that these sources are sufficient by themselves. FICUs with assets of $250 million or more should have three distinct sources of liquidity readily available.
First, all FICUs should maintain a balance sheet cushion of highly liquid assets as a basic element of liquidity risk management. It is essential for FICUs of all sizes to hold an adequate safeguard of cash and cash equivalents (such as short-term deposits and Treasury securities) on the balance sheet continuously. A balance-sheet cushion affords an institution time to avoid service disruptions and enter external funding arrangements if necessary.
A second element of liquidity management is borrowing from market counterparties, such as corporate credit unions, correspondent banks, FHLBs, and repurchase agreement counterparties. The ability to borrow from market sources requires having unencumbered assets that can be readily pledged against a loan. Larger FICUs with greater potential funding needs should have multiple stable borrowing sources and a clear understanding of which assets can be pledged.
The third element of protection is access to a federal emergency liquidity provider: The CLF or the Discount Window. These providers exist to provide backup liquidity in circumstances where on-balance sheet liquidity and market sources prove inadequate. Like the market funding sources, the CLF and Discount Window are both collateral-based lending facilities. The Board believes that, to protect the NCUSIF, it is essential for FICUs with assets of at least $250 million to have this third element of liquidity in place.
The rule provides that a FICU may demonstrate access by becoming a regular member of the CLF, becoming a member of the CLF through an agent, or establishing borrowing access through the Discount Window. As discussed in the preamble to the proposed rule, corporate credit unions may facilitate natural person credit unions becoming regular CLF members by, for example, assisting with applications of credit, serving as a collateral custodian and
The Discount Window serves all depository institutions that meet eligibility requirements established by Federal Reserve regulations.
The Board notes that, while not required in the final rule, a FICU may wish to both become a member of the CLF and establish borrowing access at the Discount Window. The combination of the CLF and the Discount Window would provide the greatest protection in the event of a sudden and sustained liquidity emergency. The Discount Window is designed to handle sudden emergencies that require same-day access to liquidity. The CLF, on the other hand, is designed to handle sustained emergencies that require federal backup liquidity for several months.
The following table shows some of the similarities and differences between the CLF and the Discount Window.
With established access to both, in a liquidity crisis, when balance sheet and market sources are not enough, a FICU would have the ability to immediately obtain federal backup liquidity through the Discount Window. If the FICU's emergency liquidity needs persist for more than a few days, the FICU would have the flexibility to maintain federal backup liquidity through the CLF for several months at a time. The amount of liquidity advances available from either facility is a function of the eligible collateral available to pledge.
A FICU with $250 million or more in assets will be in compliance with this final rule if, by the effective date of March 31, 2014, it has submitted either a completed application for access to the CLF or the necessary lending agreements and corporate resolutions to obtain credit from the Discount Window.
Credit unions' assets can grow and shrink rapidly, and a particular FICU's assets may cross the $50 million or $250 million threshold repeatedly over a short period of time. In light of this fluctuation, § 741.12(e) of the final rule provides that a FICU is subject to the requirements of a higher asset category when two consecutive Call Reports show its assets to be in that higher category. A FICU will then have 120 days from the effective date of that second Call Report to meet the higher triggered requirements.
In the proposed rule, the Board requested comment on whether certain Basel III liquidity measures and monitoring tools should be incorporated into NCUA's supervisory expectations for the largest FICUs. In response to comments, the Board has determined not to take up the Basel measures at this time.
The Regulatory Flexibility Act requires NCUA to prepare an analysis to describe any significant economic impact any regulation may have on a substantial number of small entities (those under $50 million in assets). The final rule requires small FICUs to establish a basic liquidity policy, which is a best practice for every depository institution. Because the policy requires only modest effort, it will not have a significant economic impact on a substantial number of small credit unions.
The Paperwork Reduction Act of 1995 (PRA) applies to rulemakings in which an agency by rule creates a new paperwork burden on regulated entities or modifies an existing burden.
NCUA has determined the requirement to maintain a basic written liquidity policy is an information collection requirement. NCUA estimates that all 4,444 credit unions under $50 million in total assets may have to formalize their liquidity risk policies and that this task should take approximately 8 hours per credit union. The expected burden of the requirement is: 4,444 FICUs × 8 hours = 35,552 hours.
NCUA has further determined the requirement to establish and document a CFP constitutes an information collection requirement but that, because of the Policy Statement, approximately 447 out of 2,237 (or 20%) of FICUs with assets of at least $50 million will already have established such a plan. NCUA estimates that 1,790 FICUs will have to develop a written CFP and that the task should take a FICU approximately 24 hours. The expected
NCUA has also determined the requirement to either become a member of the CLF or establish borrowing access through the Discount Window creates a new information collection requirement. There are 771 FICUs with assets of at least $250 million, 374 of which are not currently regular members of CLF and/or do not report having established Discount Window access. NCUA estimates that it should take a FICU approximately 4 hours to complete the necessary paperwork to establish either CLF or Discount Window access. The expected burden of the requirement is: 374 FICUs × 4 hours = 1,496 hours.
While the regulation provides the option of establishing CLF membership through an agent, NCUA estimates that no corporates will opt to be agent members at this time and, therefore, no FICUs will establish membership in this manner.
As required by the PRA, NCUA submitted a copy of this final rule to OMB for its review and approval.
Executive Order 13132 encourages independent regulatory agencies to consider the impact of their actions on state and local interests. NCUA, an independent regulatory agency as defined in 44 U.S.C. 3502(5), voluntarily complies with the executive order to adhere to fundamental federalism principles. This final rule does 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. NCUA has determined that this rule does not constitute a policy that has federalism implications for purposes of the executive order.
The NCUA has determined that this final rule will not affect family well-being within the meaning of section 654 of the Treasury and General Government Appropriations Act, 1999, Public Law 105-277, 112 Stat. 2681 (1998).
The Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121) provides generally for congressional review of agency rules. A reporting requirement is triggered in instances where NCUA issues a final rule as defined by section 551 of the Administrative Procedure Act.
Credit, Credit unions, Reporting and recordkeeping requirements.
For the reasons stated above, the National Credit Union Administration amends 12 CFR part 741 as follows:
12 U.S.C. 1757, 1766(a), 1781-1790, and 1790d; 31 U.S.C. 3717.
(a) Any credit union insured pursuant to Title II of the Act that has assets of less than $50 million must maintain a basic written policy that provides a credit union board-approved framework for managing liquidity and a list of contingent liquidity sources that can be employed under adverse circumstances.
(b) Any credit union insured pursuant to Title II of the Act that has assets of $50 million or more must establish and document a contingency funding plan (CFP) that meets the requirements of paragraph (d) of this section.
(c) In addition to the requirement specified in paragraph (b) of this section to establish and maintain a CFP, any credit union insured pursuant to Title II of the Act that has assets of $250 million or more must establish and document access to at least one contingent federal liquidity source for use in times of financial emergency and distressed economic circumstances. These credit unions must conduct advance planning and periodic testing to ensure that contingent funding sources are readily available when needed. A credit union subject to this paragraph may demonstrate access to a contingent federal liquidity source by:
(1) Maintaining regular membership in the Central Liquidity Facility (Facility), as described in part 725 of this chapter;
(2) Maintaining membership in the Facility through an Agent, as described in part 725 of this chapter; or
(3) Establishing borrowing access at the Federal Reserve Discount Window by filing the necessary lending agreements and corporate resolutions to obtain credit from a Federal Reserve Bank pursuant to 12 CFR part 201.
(d) Contingency Funding Plan: A credit union must have a written CFP commensurate with its complexity, risk profile, and scope of operations that sets out strategies for addressing liquidity shortfalls in emergency situations. The CFP may be a separate policy or may be incorporated into an existing policy such as an asset/liability policy, a funds management policy, or a business continuity policy. The CFP must address, at a minimum, the following:
(1) The sufficiency of the institution's liquidity sources to meet normal operating requirements as well as contingent events;
(2) The identification of contingent liquidity sources;
(3) Policies to manage a range of stress environments, identification of some possible stress events, and identification of likely liquidity responses to such events;
(4) Lines of responsibility within the institution to respond to liquidity events;
(5) Management processes that include clear implementation and escalation procedures for liquidity events; and
(6) The frequency that the institution will test and update the plan.
(e) A credit union is subject to the requirements of paragraphs (b) or (c) of this section when two consecutive Call Reports show its assets to be at least $50 million or $250 million, respectively. A FICU then has 120 days from the effective date of that second Call Report to meet the greater requirements.
National Credit Union Administration (NCUA).
Final rule.
The NCUA Board (Board) is issuing a final rule to amend its
This rule is effective January 1, 2014.
Sarah Chung, Staff Attorney, Office of General Counsel, at 1775 Duke Street, Alexandria, Virginia 22314-3428, telephone (703) 518-1178, or Mark Vaughan, Director, Division of Analytics and Surveillance, Office of Examination and Insurance, at 1775 Duke Street, Alexandria, Virginia 22314-3428, telephone (703) 518-6622.
The Federal Credit Union Act (Act) provides NCUA with broad authority to require FICUs, including corporate credit unions, to submit financial data and other information as required by the Board.
Section 741.6(a) of NCUA's regulations requires FICUs to file financial, statistical, and other reports, including call reports. Section 748.1 of NCUA's regulations requires the president or managing official of each FICU to certify compliance with a variety of requirements in its credit union profile.
Under NCUA's current regulations, a FICU must use NCUA's information management system, or other electronic means specified by NCUA, to submit its reportable data online, unless it is unable to do so.
Executive Order 13579 provides that independent agencies, including NCUA, should consider if they can modify, streamline, expand, or repeal existing rules to make their programs more effective and less burdensome. NCUA seeks to reduce operating costs and promote environmentally responsible practices. NCUA estimates it costs the agency $125 per filer per quarter to process manual filings of call reports alone. In July 2013, NCUA proposed to require all FICUs to submit call reports and other data electronically, and to update their credit union profiles online to reduce the expense of printing and mailing paper forms and other processing costs.
Additionally, NCUA would increase efficiency, enhance accuracy of data, and provide a secure access portal that is the sole means for FICUs to submit, edit, and view data that NCUA collects. This permits FICUs to submit data securely to NCUA from any computer with Internet access. To assist FICUs making this transition, NCUA already provides instructions on how to report online and has posted a “frequently asked questions” section on NCUA's Web site.
NCUA received 12 comments on the proposed rule. The comments were from 3 trade associations representing credit unions, 6 state credit union leagues (some of these leagues represent more than one state), a state-chartered, federally insured credit union, a federal credit union, and a state regulators association.
Six commenters generally supported the proposed rule. Some commenters believed the proposal would lead to increased efficiencies and enhance the accuracy and availability of data. Others maintained that NCUA appropriately considered the burden on filers and made hardware and training available to help small credit unions.
Six commenters generally did not support the proposed rule. Some commenters expressed concerns about the hardships that electronic filing may have on the smallest credit unions who have limited staffing and electronic resources. Others did not believe the proposed rule would sufficiently reduce costs and increase efficiency for NCUA, and found that manual filings were not a significant burden on NCUA's resources.
Commenters also made other recommendations. Some of these recommendations include having NCUA: 1) Change the required filing date for call reports to be 30 days after the end of the quarter; 2) encourage manual filers to move toward electronic filing within a reasonable amount of time, the duration of which should depend on the particular credit union; and 3) continue to work with small credit unions, through its Office of Small Credit Union Initiatives (OSCUI), to help move them toward electronic filing.
The Board has considered all public comments carefully. While NCUA appreciates the commenters' concerns for small credit unions, NCUA believes that electronic filing will save time and resources, as well as increase the efficiency in processing all reports. NCUA believes that once manual filers embrace online filing, they will find it is quicker and easier than manual filing, and it will reduce their administrative burden. NCUA will continue to help small credit unions transition to electronic filing and anticipates that OSCUI will continue to participate in this effort.
Accordingly, the Board is adopting the July 2013 proposed rule as final without any changes. The final rule will be effective on January 1, 2014, which means it is applicable to the fourth quarter 2013 call report data, which are due to NCUA later in January 2014.
The Regulatory Flexibility Act requires NCUA to prepare an analysis to describe any significant economic impact a regulation may have on a substantial number of small entities.
The Paperwork Reduction Act of 1995 (PRA) applies to rulemakings in which an agency by rule creates a new paperwork burden on regulated entities or modifies an existing burden.
Executive Order 13132 encourages independent regulatory agencies to consider the impact of their actions on state and local interests. In adherence to fundamental federalism principles, NCUA, an independent regulatory agency as defined in 44 U.S.C. 3502(5), voluntarily complies with the executive order. This final rule will not have a substantial direct effect on the states, on the connection between the national government and the states, or on the distribution of power and responsibilities among the various levels of government. NCUA has determined this final rule does not constitute a policy that has federalism implications for purposes of the executive order.
NCUA has determined that this final rule will not affect family well-being within the meaning of Section 654 of the Treasury and General Government Appropriations Act, 1999, Public Law 105-277, 112 Stat. 2681 (1998).
The Small Business Regulatory Enforcement Fairness Act of 1996
Credit, Credit unions, Reporting and recordkeeping requirements, Share insurance.
Credit unions, Reporting and recordkeeping requirements, Security measures.
For the reasons stated above, NCUA amends 12 CFR parts 741 and 748 as follows:
12 U.S.C. 1757, 1766(a), 1781-1790, and 1790d; 31 U.S.C. 3717.
(a) Upon written notice from the NCUA Board, Regional Director, Director of the Office of Examination and Insurance, or Director of the Office of National Examinations and Supervision, insured credit unions must file financial and other reports in accordance with the instructions in the notice. Insured credit unions must use NCUA's information management system, or other electronic means specified by NCUA, to submit their data online.
12 U.S.C. 1766(a), 1786(q); 15 U.S.C. 6801-6809; 31 U.S.C. 5311 and 5318.
(a) The president or managing official of each federally insured credit union must certify compliance with the requirements of this part in its Credit Union Profile annually through NCUA's online information management system.
Federal Trade Commission (FTC).
Final rule amendments.
The Commission is revising its rules to authorize the General Counsel to redelegate his or her authority to determine appeals related to the Freedom of Information Act (“FOIA”). The Commission is adopting these changes in order to improve and expedite the process for responding to such appeals. The changes will affect internal procedures only and are not intended to influence the outcomes of appeals made under the rules. The Commission is also adding a new provision that explicitly provides the right to appeal fee waiver determinations under the FOIA.
These amendments are effective October 30, 2013.
W. Ashley Gum, Attorney, Office of the General Counsel, FTC, 600 Pennsylvania Avenue NW., Washington, DC 20580, 202-326-3006.
Under the Commission's current rule governing FOIA appeals (16 CFR 4.11(a)), appeals from initial denials of requests for extensions, and initial denials of requests for information under the FOIA, are addressed to the General Counsel. 16 CFR 4.11(a)(3)(i)(A)(
As noted above, the Commission is also adding a new Rule 4.11(a)(3)(i)(A)(
The Commission believes that the proposed rule amendments do not require an initial or final regulatory analysis under the Regulatory Flexibility Act because the amendments will not have a significant economic impact on a substantial number of small entities.
Administrative practice and procedure, Freedom of Information Act.
For the reasons set forth in the preamble, the Federal Trade Commission amends Title 16, Chapter I, Subchapter A of the Code of Federal Regulations as follows:
: 15 U.S.C. 46, unless otherwise noted.
(a) * * *
(3) * * *
(i) * * *
(A) * * *
(
(iii) * * *
(B) The General Counsel may designate a Deputy General Counsel to make any determination assigned to the General Counsel by paragraph (a) of this section. The General Counsel or the official designated by the General Counsel to make the determination shall be deemed solely responsible for the denial of all appeals, except where an appeal is denied by the Commission. In such instances, the Commission shall be deemed solely responsible for the denial.
By direction of the Commission.
Coast Guard, DHS.
Notice of deviation from drawbridge regulation.
The Coast Guard has issued a temporary deviation from the operating schedule that governs the SR 170/Centerville Turnpike Bridge, at AICW mile 15.2, across Albemarle and Chesapeake Canal, at Chesapeake, VA. The deviation is necessary to facilitate structural repairs to the superstructure of the SR 170/Centerville Turnpike Bridge. This temporary deviation will allow the drawbridge to change the operating schedule on specific dates and times.
This deviation is effective from 7 a.m. on November 2, 2013 until 7 p.m. November 10, 2013.
The docket for this deviation, [USCG-2013-0900] is available at
If you have questions on this temporary deviation, call or email Mr. Jim Rousseau, Bridge Administration Branch Fifth District, Coast Guard, telephone (757) 398-6557, email
The City of Chesapeake, who owns and operates this swing bridge, has requested a temporary deviation from the current operating regulations set out in 33 CFR 117.997(i), to facilitate structural repairs.
Under the regular operating schedule, the S.R. 170/Centerville Turnpike
The S.R. 170/Centerville Turnpike Bridge has a vertical clearance in the open and closed position of unlimited and 4 feet, above mean high water, respectively.
Under this temporary deviation, the drawbridge will be operated under the following schedule to facilitate superstructure repairs, beginning at 7 a.m., on Saturday, November 2, 2013 and ending at 7 p.m., on Sunday, November 3, 2013, the drawbridge will open on signal every three hours on the following schedule: on Saturday, November 2nd at 7 a.m., 10 a.m., 1 p.m., 4 p.m., 7 p.m., 10 p.m. and on Sunday, November 3rd at 1 a.m., 4 a.m., 7 a.m., 10 a.m., 1 p.m., 4 p.m. and 7 p.m.; will open on signal for hazardous material vessels with a one-hour advance notice by calling (757-547-3631); and will open for an emergency as soon as safely possible. In case of inclement weather, the alternate dates will be rescheduled to weekend of November 9 and November 10, 2013. The bridge will operate under its current operating schedule at all other times. The Coast Guard has carefully reviewed bridge opening logs and coordinated the restrictions with commercial and recreational waterway users.
Vessels able to pass under the bridge in the closed position may do so at anytime and are advised to proceed with caution. The drawbridge will be able to open for emergencies as soon as safely possible. There is no immediate alternate route for vessels transiting this section of the AICW but vessels may pass before and after the closure each day. The Coast Guard will also inform additional waterway users through our Local and Broadcast Notices to Mariners of the closure periods for the bridge so that vessels can arrange their transits to minimize any impacts caused by the temporary deviation.
In accordance with 33 CFR 117.35(e), the drawbridge must return to its regular operating schedule immediately at the end of the effective period of this temporary deviation.
This deviation from the operating regulations is authorized under 33 CFR 117.35.
Coast Guard, DHS.
Notice of deviation from drawbridge regulation.
The Coast Guard has issued a temporary deviation from the operating schedule that governs the Hannibal Railroad Drawbridge across the Upper Mississippi River, mile 309.9, at Hannibal, Missouri. The deviation is necessary to allow the bridge owner time to replace critical control components that are essential to the continued safe operation of the drawbridge. The work is scheduled in the winter, when the impact on navigation is minimal, instead of scheduling the work at other times in the year, when river traffic is prevalent. This deviation allows the bridge to remain in the closed-to-navigation position for 39 days.
This deviation is effective from 7 a.m., January 7, 2014 to 5 p.m., February 14, 2014.
The docket for this deviation, [USCG-2013-0828], is available at
If you have questions on this temporary deviation, call or email Eric A. Washburn, Bridge Administrator, Western Rivers, Coast Guard; telephone (314) 269-2378, email
The Norfolk Southern Railroad requested a temporary deviation for the Hannibal Railroad Drawbridge, mile 309.9, at Hannibal, Missouri across the Upper Mississippi River. It has a vertical clearance of 21.1 feet above normal pool in the closed position. The Hannibal Railroad Drawbridge currently operates in accordance with 33 CFR 117.5, which states the general requirement that drawbridges shall open promptly and fully for the passage of vessels when a request to open is given in accordance with the subpart.
The deviation period is from 7 a.m., January 7, 2014 to 5 p.m., February 14, 2014 when the draw span will remain in the closed-to-navigation position. During this time the bridge owner will replace critical control components that are essential to the continued safe operation of the drawbridge. The bridge will not be able to open for emergencies and there is no immediate alternate route for vessels to pass this section of the Upper Mississippi River. The Coast Guard will also inform the users of the waterway through our Local and Broadcast Notices to Mariners of the change in operating schedule for the bridge so that vessels can arrange their transits to minimize any impact caused by the temporary deviation.
Winter conditions on the Upper Mississippi River coupled with the closure of Army Corps of Engineer's Lock No. 18 (Mile 410.5 UMR) and Lock No. 22 (Mile 301.2 UMR) till 11 a.m., March 4, 2014 will preclude any significant navigation demands for the drawspan opening.
In accordance with 33 CFR 117.35(e), the drawbridge must return to its regular operating schedule immediately at the end of the effective period of this temporary deviation. This deviation from the operating regulations is authorized under 33 CFR 117.35.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Temporary rule; reopening.
NMFS reopens the 2013-2014 commercial sector for king mackerel in the western zone of the Gulf of Mexico (Gulf) exclusive economic zone (EEZ). NMFS previously projected that the commercial annual catch limit (ACL) (equal to the commercial quota) for king mackerel in the western zone of the Gulf EEZ would be reached by September 20, 2013, and closed the western zone of the Gulf to commercial king mackerel fishing in the EEZ at noon, local time, September 20, 2013, until 12:01 a.m., local time, on July 1, 2014. However, updated landings estimates indicate the commercial ACL (commercial quota) for king mackerel in the western zone of the Gulf EEZ has not been reached at this time. Therefore, NMFS is reopening the western zone of the Gulf to commercial king mackerel fishing in the EEZ at 12:01 a.m., local time, on November 1, 2013, until 12:01 a.m., local time, on November 3, 2013. The intended effect of this temporary rule is to maximize harvest benefits for the commercial sector for Gulf king mackerel in the western zone.
The reopening is effective 12:01 a.m., local time, November 1, 2013, until 12:01 a.m., local time, on November 3, 2013.
Steve Branstetter, 727-824-5305, email:
The fishery for coastal migratory pelagic fish (king mackerel, Spanish mackerel, and cobia) is managed under the Fishery Management Plan for the Coastal Migratory Pelagic Resources of the Gulf of Mexico and South Atlantic (FMP). The FMP was prepared by the Gulf of Mexico and South Atlantic Fishery Management Councils and is implemented under the authority of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act) by regulations at 50 CFR part 622.
NMFS projected that the commercial annual catch limit (ACL) (equal to the commercial quota) for king mackerel in the western zone of the Gulf EEZ would be reached on September 20, 2013, and published a temporary rule to close the western zone of the Gulf to commercial king mackerel fishing in the EEZ (78 FR 58248). However, since that closure, the Science and Research Director has received additional landings data and has determined that the commercial ACL (commercial quota) was not harvested prior to September 20, 2013. Therefore, in accordance with 50 CFR 622.8(c), NMFS is reopening the western zone of the Gulf to commercial king mackerel fishing in the EEZ at 12:01 a.m., local time, on November 1, 2013, until 12:01 a.m., local time, on November 3, 2013.
The Gulf group king mackerel western zone begins at the United States/Mexico border (near Brownsville, Texas) and continues to the boundary between the eastern and western zones at 87°31.1′ W. long., which is a line directly south from the Alabama/Florida boundary.
After the commercial sector closes, no person aboard a vessel for which a commercial permit for king mackerel has been issued, except for a person aboard a charter vessel or headboat, may fish for or retain Gulf group king mackerel in the EEZ in the closed zone (50 CFR 622.384(e)(1)). During the closure, a person aboard a vessel that has a valid charter vessel/headboat permit for coastal migratory pelagic fish may continue to retain king mackerel in or from the closed zones or subzones under the bag and possession limits set forth in 50 CFR 622.382(a)(1)(ii) and (a)(2), provided the vessel is operating as a charter vessel or headboat (50 CER 622.384(e)(2)). A charter vessel or headboat that also has a commercial king mackerel permit is considered to be operating as a charter vessel or headboat when it carries a passenger who pays a fee or when there are more than three persons aboard, including operator and crew.
During the closure, king mackerel from the closed zone, including those harvested under the bag and possession limits, may not be purchased or sold. This prohibition does not apply to trade in king mackerel from the closed zone that were harvested, landed ashore, and sold prior to the closure and were held in cold storage by a dealer or processor (50 CFR 622.384(e)(3)).
The Regional Administrator, Southeast Region, NMFS, has determined this temporary rule is necessary for the conservation and management of Gulf king mackerel and is consistent with the Magnuson-Stevens Act and other applicable laws.
This action is taken under 50 CFR 622.8(c) and is exempt from review under Executive Order 12866.
These measures are exempt from the procedures of the Regulatory Flexibility Act because the temporary rule is issued without opportunity for prior notice and comment.
This action responds to the best scientific information available. The Assistant Administrator for Fisheries, NOAA (AA), finds good cause to waive the requirements to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such prior notice and opportunity for public comment is unnecessary and contrary to the public interest. Such procedures are unnecessary because NMFS previously determined the commercial ACL (commercial quota) for king mackerel in the western zone of the Gulf EEZ would be reached by September 20, 2013, and therefore, closed the commercial sector for king mackerel in the western zone of the Gulf EEZ at noon, local time, on September 20, 2013. However, updated landings estimates indicate the commercial ACL (commercial quota) for king mackerel in the western zone of the Gulf EEZ has not been reached at this time, and therefore additional harvest is available in order to achieve optimum yield. All that remains is to notify the public that additional harvest is available under the established commercial ACL (commercial quota) and, therefore, the commercial sector for king mackerel in the western zone of the Gulf EEZ will reopen.
Prior notice and an opportunity to comment is contrary to the public interest because king mackerel is a migratory species, making the harvest of the commercial ACL (commercial quota) for the western zone of the Gulf EEZ time-sensitive. Reopening quickly will likely make additional king mackerel available to consumers and result in revenue increases to commercial vessels.
For the aforementioned reasons, the AA also finds good cause to waive the
16 U.S.C. 1801
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Temporary final rule; emergency action extended.
This rule extends, pursuant to NMFS's emergency authority in the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act), the Georges Bank (GB) yellowtail flounder and white hake specifications for fishing year (FY) 2013 and the GOM cod sector carryover reduction that were published on May 3, 2013, which were implemented as emergency actions concurrently with the Framework Adjustment (FW) 50 final rule under the Northeast (NE) Multispecies Fishery Management Plan (FMP). These measures were scheduled to expire on October 30, 2013. Specifically, this temporary rule maintains the current Acceptable Biological Catch (ABC) and Annual Catch Limit (ACL) for GB yellowtail flounder and white hake, and the 1.85-percent allowable carryover of unused FY 2012 GOM cod Annual Catch Entitlement (ACE) for sectors for an additional 183 days, i.e., through the end of FY 2013 (May 1, 2013, through April 30, 2014). The need for the emergency measures is unchanged, which is to establish FY 2013 catch limits for GB yellowtail flounder and white hake based upon the best available scientific information, and to reduce available carryover of unused FY 2012 GOM cod ACE for sectors. The intended effect of the emergency measures is to prevent overfishing on GB yellowtail flounder and GOM cod, and to incorporate the best available science into the management of white hake.
This rule is effective October 30, 2013, through April 30, 2014.
The expiration date of the emergency measures for GB yellowtail flounder and white hake specifications, and GOM cod carryover in the preamble of the final rule published May 3, 2013, (78 FR 26172) is extended through April 30, 2014.
Copies of Framework 50, associated emergency rules, and other measures, the environmental assessment (EA), its Regulatory Impact Review (RIR), and the Final Regulatory Flexibility Act (FRFA) analysis prepared by the New England Fishery Management Council (Council) and NMFS are available from John K. Bullard, Regional Administrator, NMFS Northeast Regional Office (NERO), 55 Great Republic Drive, Gloucester, MA 01930. The FRFA analysis consists of the FRFA, public comments and responses, and the summary of impacts and alternatives contained in the final rule for Framework 50, Associated Emergency Rules, and Other Measures. The EA/RIR/FRFA is also accessible via the Internet at:
Melissa Hooper, Fishery Policy Analyst, (978) 281-9166, fax (978) 281-9135.
This temporary final rule extends the revised GB yellowtail flounder and white hake catch limits and GOM cod carryover implemented through emergency authority in the Magnuson-Stevens Act, as published in the Framework 50 final rule on May 3, 2013, to maintain those measures through the end of FY 2013 (April 30, 2014). The May 3, 2013, final rule (78 FR 26172) included detailed information on the background, reasons, and justification to revise through emergency action, the GB yellowtail flounder and white hake catch limits from those originally proposed in the Framework 50 proposed rule (78 FR 19368; March 29, 2013) and from the standard 10-percent allowable carryover for GOM cod. That information is not repeated here.
Section 305(c) of the Magnuson-Stevens Act allows for the extension of an emergency action, which is otherwise effective for up to 180 days, for up to another 186 days, provided that certain criteria are met: (1) The public has had an opportunity to comment on the emergency regulation, and (2) in the case of a Council recommendation for emergency action, the Council is actively developing an FMP amendment or regulations to address the emergency or overfishing on a permanent basis. NMFS accepted public comment on the emergency measures in the final rule through June 17, 2013, but no comments were submitted. Because these extensions do not change the measures already in place, we are not accepting additional public comment on their extension, NMFS has determined that all the necessary criteria have been met and, therefore, is extending these emergency measures.
The emergency specifications extended through this final rule are the revised GB yellowtail flounder catch limits for FY 2013, as follows: A U.S. Overfishing Limit (OFL) of 882 mt; a U.S. ABC of 215 mt; a total ACL of 208.5 mt; a groundfish sub-ACL of 116.8 mt; a scallop fishery sub-ACL of 83.4 mt; a small-mesh fisheries sub-ACL of 4.0 mt; and an Other ACL sub-component of 4.3 mt. The initial emergency action modified GB yellowtail flounder catch limits from those originally proposed based on a determination that the Framework 50 proposed catch limits were not based upon the Council's Scientific and Statistical Committee (SSC) recommendation, were not consistent with the best available scientific information, and had a high likelihood of resulting in overfishing.
Although the Framework 50 final rule contained preliminary information regarding the more specific components of the groundfish sub-ACL (the division of the groundfish sub-ACL between sectors and the common pool and the Incidental Catch Total Allowable Catches for common pool vessels), it did not implement the final specification of these components (and this rule does not need to address those aspects of the FMP). The components of the GB yellowtail flounder groundfish sub-ACL are specified in the final rule that adjusted the FY 2013 groundfish sub-ACL components for all stocks (78 FR 34928; June 11, 2013).
The emergency specifications extended through this final rule are the revised white hake catch limits for FY 2013, as follows: A U.S. OFL of 5,462 mt; a U.S. ABC of 4,177 mt; a total ACL of 3,974 mt; a groundfish sub-ACL of 3,849 mt; a state waters sub-component
As explained under Item 1, the Framework 50 final rule contained preliminary information regarding the more specific components of the groundfish sub-ACL and the final distribution of these components are as specified in the June 11, 2013, final adjustment rule.
This temporary rule extends the emergency reduction to the amount of unused GOM cod ACE that sectors were allowed to carryover from FY 2012 to FY 2013 to 1.85 percent. NMFS determined, based on analysis, that if sectors carried over the full 10 percent of their unused FY 2013 ACE for GOM cod, it would increase the likelihood of overfishing on this stock. Thus, through the Framework 50 final rule, NMFS reduced the amount of allowable GOM cod carryover to 1.85 percent of the sectors' FY 2012 ACE to ensure the total potential catch (ACL + carryover) did not exceed the FY 2013 GOM cod OFL.
As described above, no comments were received on these measures.
The Regional Administrator, Northeast Region, NMFS, has determined that the emergency measures extended by this temporary rule are necessary for the conservation and management of the NE multispecies fishery and are consistent with the Magnuson-Stevens Act and other applicable law.
The Framework 50 final rule, including the emergency measures that this temporary rule extends, was determined to be significant for purposes of E.O. 12866.
The Framework 50 final rule including the emergency measures that this temporary rule extends does not contain policies with Federalism or “takings” implications as those terms are defined in E.O. 13132 and E.O. 12630, respectively.
Because the original emergency rule provided for public comment on these measures, it is not necessary to waive prior notice and comment procedures. Under 5 U.S.C. 553(d)(1), the Assistant Administrator for Fisheries finds good cause to waive the 30-day delayed effectiveness of this action. Because the extension of these emergency measures merely continues regulations already in place, it would be contrary to the public interest to allow the expiration of the revised GB yellowtail flounder and white hake catch limits and reduced GOM cod carryover, or a gap in effectiveness of these measures after October 29, 2013. As described more fully in the original May 3, 2013, emergency action (78 FR 26172), the reasons justifying promulgation of the rule on an emergency basis make a delay in effectiveness contrary to the public interest. The revised catch limits and carryover are necessary to prevent overfishing on GB yellowtail flounder and GOM cod. If the revised GB yellowtail flounder ABC were allowed to expire, it would revert to the default ABC specified in Framework 47, which NMFS has determined would be likely to result in overfishing and severe harm to the stock. Similarly, if the allowable GOM cod carryover were to revert to the standard 10 percent of FY 2012 ACE, total potential catch could exceed the OFL by 12 percent. This would represent a serious conservation and management threat to the GOM cod stock. Furthermore, a gap in the revised GB yellowtail flounder catch limits and GOM cod carryover due to a delay of this temporary rule would severely disrupt the fishery. The revised white hake catch limits were intended to incorporate the most recent, best available scientific information into the management of this stock. Increasing this catch limit was also intended to mitigate the negative economic impacts to the fishing industry from substantial reductions in catch limits for other groundfish stocks that were necessary to prevent overfishing. If the revised white hake catch limits were to expire, they would default to the lower catch limits approved in Framework 50, which were based on outdated assessment information. This could cause some fishery components to temporarily exceed their allocations. For some components of the fishery, this would trigger inseason accountability measures, temporarily closing productive fishing grounds to some vessels and resulting in foregone yield and economic losses that may negate any mitigating economic benefits of the original emergency action. Thus, even a temporary gap in effectiveness could have substantial economic impacts to the fishing industry and severely disrupt operations. For all of these reasons, a 30-day delay in the effectiveness of this rule is impracticable and contrary to the public interest.
A FRFA was prepared for the Framework 50 final rule and associated emergency measures as required by section 604 of the Regulatory Flexibility Act, 5 U.S.C. 604, and is not repeated here. The FRFA analyzed the effects of the emergency measures for the duration of the year in anticipation of this extension. A copy of the full analysis is available from NMFS (see
The EA prepared for Framework 50 analyzed the impacts of the emergency specifications for the duration of a full year. Therefore, the impacts of this emergency action extension have been analyzed, and are within the scope of the Finding of No Significant Impact.
Fisheries, Fishing, Recordkeeping and reporting requirements.
For the reasons stated in the preamble, 50 CFR part 648 is amended as follows:
16 U.S.C. 1801
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Temporary rule; closure.
NMFS is prohibiting directed fishing for Atka mackerel in the Central Aleutian district (CAI) of the Bering Sea and Aleutian Islands management area (BSAI) by vessels participating in the BSAI trawl limited access fishery. This action is necessary to prevent exceeding the 2013 total allowable catch (TAC) of Atka mackerel in this area allocated to vessels participating in the BSAI trawl limited access fishery.
Effective 1200 hrs, Alaska local time (A.l.t.), October 25, 2013, through 2400 hrs, A.l.t., December 31, 2013.
Steve Whitney, 907-586-7269.
NMFS manages the groundfish fishery in the BSAI exclusive economic zone according to the Fishery Management Plan for Groundfish of the Bering Sea and Aleutian Islands Management Area (FMP) prepared by the North Pacific Fishery Management Council under authority of the Magnuson-Stevens Fishery Conservation and Management Act. Regulations governing fishing by U.S. vessels in accordance with the FMP appear at subpart H of 50 CFR part 600 and 50 CFR part 679.
The 2013 TAC of Atka mackerel, in the CAI, allocated to vessels participating in the BSAI trawl limited access fishery was established as a directed fishing allowance of 664 metric tons by the final 2013 and 2014 harvest specifications for groundfish in the BSAI (78 FR 13813, March 1, 2013).
In accordance with § 679.20(d)(1)(iii), the Regional Administrator finds that this directed fishing allowance has been reached. Consequently, NMFS is prohibiting directed fishing for Atka mackerel in the CAI by vessels participating in the BSAI trawl limited access fishery.
After the effective dates of this closure, the maximum retainable amounts at § 679.20(e) and (f) apply at any time during a trip.
This action responds to the best available information recently obtained from the fishery. The Acting Assistant Administrator for Fisheries, NOAA, (AA) finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such a requirement is impracticable and contrary to the public interest. This requirement is impracticable and contrary to the public interest as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay the closure of the Atka mackerel directed fishery in the CAI for vessels participating in the BSAI trawl limited access fishery. NMFS was unable to publish a notice providing time for public comment because the most recent, relevant data only became available as of October 24, 2013. The AA also finds good cause to waive the 30-day delay in the effective date of this action under 5 U.S.C. 553(d)(3). This finding is based upon the reasons provided above for waiver of prior notice and opportunity for public comment.
This action is required by § 679.20 and is exempt from review under Executive Order 12866.
16 U.S.C. 1801
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Temporary rule; closure.
NMFS is prohibiting directed fishing for Pacific ocean perch in the Central Aleutian district (CAI) of the Bering Sea and Aleutian Islands management area (BSAI) by vessels participating in the BSAI trawl limited access fishery. This action is necessary to prevent exceeding the 2013 total allowable catch (TAC) of Pacific ocean perch in this area allocated to vessels participating in the BSAI trawl limited access fishery.
Effective 1200 hrs, Alaska local time (A.l.t.), October 25, 2013, through 2400 hrs, A.l.t., December 31, 2013.
Steve Whitney, 907-586-7269.
NMFS manages the groundfish fishery in the BSAI exclusive economic zone according to the Fishery Management Plan for Groundfish of the Bering Sea and Aleutian Islands Management Area (FMP) prepared by the North Pacific Fishery Management Council under authority of the Magnuson-Stevens Fishery Conservation and Management Act. Regulations governing fishing by U.S. vessels in accordance with the FMP appear at subpart H of 50 CFR part 600 and 50 CFR part 679.
The 2013 TAC of Pacific ocean perch, in the CAI, allocated to vessels participating in the BSAI trawl limited access fishery was established as a directed fishing allowance of 616 metric tons by the final 2013 and 2014 harvest specifications for groundfish in the BSAI (78 FR 13813, March 1, 2013).
In accordance with § 679.20(d)(1)(iii), the Regional Administrator finds that this directed fishing allowance has been reached. Consequently, NMFS is prohibiting directed fishing for Pacific ocean perch in the CAI by vessels participating in the BSAI trawl limited access fishery.
After the effective dates of this closure, the maximum retainable amounts at § 679.20(e) and (f) apply at any time during a trip.
This action responds to the best available information recently obtained from the fishery. The Acting Assistant Administrator for Fisheries, NOAA, (AA) finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such a requirement is impracticable and contrary to the public interest. This requirement is impracticable and contrary to the public interest as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay the closure of the Pacific ocean perch directed fishery in the CAI for
This action is required by § 679.20 and is exempt from review under Executive Order 12866.
16 U.S.C. 1801
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Temporary rule; closure.
NMFS is prohibiting directed fishing for Pacific ocean perch in the Eastern Aleutian district (EAI) of the Bering Sea and Aleutian Islands management area (BSAI) by vessels participating in the BSAI trawl limited access fishery. This action is necessary to prevent exceeding the 2013 total allowable catch (TAC) of Pacific ocean perch in this area allocated to vessels participating in the BSAI trawl limited access fishery.
Effective 1200 hrs, Alaska local time (A.l.t.), October 25, 2013, through 2400 hrs, A.l.t., December 31, 2013.
Steve Whitney, 907-586-7269.
NMFS manages the groundfish fishery in the BSAI exclusive economic zone according to the Fishery Management Plan for Groundfish of the Bering Sea and Aleutian Islands Management Area (FMP) prepared by the North Pacific Fishery Management Council under authority of the Magnuson-Stevens Fishery Conservation and Management Act. Regulations governing fishing by U.S. vessels in accordance with the FMP appear at subpart H of 50 CFR part 600 and 50 CFR part 679.
The 2013 TAC of Pacific ocean perch, in the EAI, allocated to vessels participating in the BSAI trawl limited access fishery was established as a directed fishing allowance of 854 metric tons by the final 2013 and 2014 harvest specifications for groundfish in the BSAI (78 FR 13813, March 1, 2013).
In accordance with § 679.20(d)(1)(iii), the Regional Administrator finds that this directed fishing allowance has been reached. Consequently, NMFS is prohibiting directed fishing for Pacific ocean perch in the EAI by vessels participating in the BSAI trawl limited access fishery.
After the effective dates of this closure, the maximum retainable amounts at § 679.20(e) and (f) apply at any time during a trip.
This action responds to the best available information recently obtained from the fishery. The Acting Assistant Administrator for Fisheries, NOAA, (AA) finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such a requirement is impracticable and contrary to the public interest. This requirement is impracticable and contrary to the public interest as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay the closure of the Pacific ocean perch directed fishery in the EAI for vessels participating in the BSAI trawl limited access fishery. NMFS was unable to publish a notice providing time for public comment because the most recent, relevant data only became available as of October 24, 2013. The AA also finds good cause to waive the 30-day delay in the effective date of this action under 5 U.S.C. 553(d)(3). This finding is based upon the reasons provided above for waiver of prior notice and opportunity for public comment.
This action is required by § 679.20 and is exempt from review under Executive Order 12866.
16 U.S.C. 1801
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Temporary rule; closure.
NMFS is prohibiting directed fishing for Atka mackerel in the Bering Sea subarea and Eastern Aleutian district (BS/EAI) of the Bering Sea and Aleutian Islands management area (BSAI) by vessels participating in the BSAI trawl limited access fishery. This action is necessary to prevent exceeding the 2013 total allowable catch (TAC) of Atka mackerel in this area allocated to vessels participating in the BSAI trawl limited access fishery.
Effective 1200 hrs, Alaska local time (A.l.t.), October 25, 2013, through 2400 hrs, A.l.t., December 31, 2013.
Steve Whitney, 907-586-7269.
NMFS manages the groundfish fishery in the BSAI exclusive economic zone according to the Fishery Management Plan for Groundfish of the Bering Sea and Aleutian Islands Management Area (FMP) prepared by the North Pacific Fishery Management Council under authority of the Magnuson-Stevens Fishery Conservation and Management Act. Regulations governing fishing by U.S. vessels in accordance with the FMP appear at subpart H of 50 CFR part 600 and 50 CFR part 679.
The 2013 TAC of Atka mackerel, in the BS/EAI, allocated to vessels participating in the BSAI trawl limited access fishery was established as a directed fishing allowance of 1,402 metric tons by the final 2013 and 2014 harvest specifications for groundfish in the BSAI (78 FR 13813, March 1, 2013).
In accordance with § 679.20(d)(1)(iii), the Regional Administrator finds that this directed fishing allowance has been reached. Consequently, NMFS is prohibiting directed fishing for Atka mackerel in the BS/EAI by vessels participating in the BSAI trawl limited access fishery.
After the effective dates of this closure, the maximum retainable amounts at § 679.20(e) and (f) apply at any time during a trip.
This action responds to the best available information recently obtained from the fishery. The Acting Assistant Administrator for Fisheries, NOAA, (AA) finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such a requirement is impracticable and contrary to the public interest. This requirement is impracticable and contrary to the public interest as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay the closure of the Atka mackerel directed fishery in the BS/EAI for vessels participating in the BSAI trawl limited access fishery. NMFS was unable to publish a notice providing time for public comment because the most recent, relevant data only became available as of October 24, 2013. The AA also finds good cause to waive the 30-day delay in the effective date of this action under 5 U.S.C. 553(d)(3). This finding is based upon the reasons provided above for waiver of prior notice and opportunity for public comment.
This action is required by § 679.20 and is exempt from review under Executive Order 12866.
16 U.S.C. 1801
Federal Aviation Administration (FAA), Department of Transportation (DOT).
Notice of proposed rulemaking (NPRM).
We propose to adopt a new airworthiness directive (AD) for B-N Group Ltd. Models BN-2, BN-2A, BN-2A-2, BN-2A-3, BN-2A-6, BN-2A-8, BN-2A-9, BN-2A-20, BN-2A-21, BN-2A-26, BN-2A-27, BN-2B-20, BN-2B-21, BN-2B-26, BN-2B-27, BN2A MK. III, BN2A MK. III-2, and BN2A MK. III-3 airplanes. This proposed AD results from mandatory continuing airworthiness information (MCAI) originated by an aviation authority of another country to identify and correct an unsafe condition on an aviation product. The MCAI describes the unsafe condition as damage of the cable sliding end assembly and installation of the incorrect end fitting on engine control cable assemblies. We are issuing this proposed AD to require actions to address the unsafe condition on these products.
We must receive comments on this proposed AD by December 16, 2013.
You may send comments by any of the following methods:
•
•
•
For service information identified in this proposed AD, contact Britten-Norman Aircraft Limited, Commodore House, Mountbatten Business Centre, Millbrook Road East, Southampton SO15 1HY, United Kingdom; telephone: +44 20 3371 4000; fax: +44 20 3371 4001; email:
You may examine the AD docket on the Internet at
Taylor Martin, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone: (816) 329-4138; fax: (816) 329-4090; email:
We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under the
We will post all comments we receive, without change, to
The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Community, has issued EASA AD No.: 2013-0215, dated September 16, 2013 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states:
Britten-Norman Aircraft Limited has been made aware of two occurrences where a failure of engine control cable assemblies has caused engine control difficulties. In both reported cases, the cable sliding end assemblies were in poor condition and in both cases, an incorrect end-fitting was installed which may have contributed to the failures.
This condition, if not detected and corrected, could result in reduced engine control, possibly resulting in reduced control of the aeroplane.
To address this potential unsafe condition, Britten-Norman Aircraft have issued Service Bulletin (SB) 334 to provide inspection instructions.
For the reason described above, this AD requires a one-time inspection and functional test of the engine control cables and, depending on findings, replacement of the cables.
You may examine the MCAI on the Internet at
Britten-Norman Aircraft Limited has issued Service Bulletin No. SB 334, Issue 1, dated August 30, 2013. The actions described in this service information are intended to correct the unsafe condition identified in the MCAI.
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
We estimate that this proposed AD will affect 101 products of U.S. registry. We also estimate that it would take about 1 work-hour per product to comply with the basic requirements of this proposed AD. The average labor rate is $85 per work-hour.
Based on these figures, we estimate the cost of the proposed AD on U.S. operators to be $8,585, or $85 per product.
In addition, we estimate that any necessary follow-on actions would take about 10 work-hours and require parts costing $4,800 (4 per airplane), for a cost of $5,650 per product. We have no way of determining the number of products that may need these actions.
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 proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government.
For the reasons discussed above, I certify this proposed regulation:
(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.
Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety.
Accordingly, under the authority delegated to me by the Administrator, the FAA proposes to amend 14 CFR part 39 as follows:
49 U.S.C. 106(g), 40113, 44701.
We must receive comments by December 16, 2013.
None.
This AD applies to B-N Group Ltd. Models BN-2, BN-2A, BN-2A-2, BN-2A-3, BN-2A-6, BN-2A-8, BN-2A-9, BN-2A-20, BN-2A-21, BN-2A-26, BN-2A-27, BN-2B-20, BN-2B-21, BN-2B-26, BN-2B-27, BN2A MK. III, BN2A MK. III-2, and BN2A MK. III-3 airplanes, all serial numbers, certificated in any category.
Air Transport Association of America (ATA) Code 76: Engine Controls.
This AD was prompted by mandatory continuing airworthiness information (MCAI) originated by an aviation authority of another country to identify and correct an unsafe condition on an aviation product. The MCAI describes the unsafe condition as damage of the cable sliding end assembly and installation of the incorrect end fitting on engine control cable assemblies. We are issuing this AD to detect and correct damage of the cable sliding end assembly (cracking, distortion, corrosion) and incorrect end fittings on the engine control assemblies, which could lead to reduced engine control with consequent loss of control.
Unless already done, do the following actions:
(1) Within the next 6 months after the effective date of this AD, do a one-time inspection of the engine control cable assemblies, part number (P/N) 137835, P/N 172449-1, P/N 17250, and P/N 172451, and surrounding areas for damage (cracking, distortion, corrosion) and correct cable end-fitting and to assure the wire locking is intact following section 6 ACTION of Britten-Norman Aircraft Limited Service Bulletin No. SB 334, Issue 1, dated August 30, 2013.
(2) If no discrepancies are found during the inspection required in paragraph (f)(1) of this AD, inspect the control linkages for proper adjustment and, before further flight, make any necessary changes following section 6 ACTION of Britten-Norman Aircraft Limited Service Bulletin No. SB 334, Issue 1, dated August 30, 2013.
(3) If any discrepancies are found during the inspection required in paragraph (f)(1) of this AD and/or the control linkages cannot be properly adjusted as specified in paragraph (f)(2) of this AD, before further flight, replace the engine control cable assembly with a serviceable unit following section 6 ACTION of Britten-Norman Aircraft Limited Service Bulletin No. SB 334, Issue 1, dated August 30, 2013.
(4) After the effective date of this AD, do not install on any airplane engine control cable assemblies, part number (P/N) 137835, P/N 172449-1, P/N 17250, and P/N 172451, unless they are new or have been inspected as required in paragraphs (f)(1) and (f)(2) of this AD and found free of any discrepancies and have proper adjustment.
The following provisions also apply to this AD:
(1)
(2)
Refer to MCAI European Aviation Safety Agency (EASA) AD No.: 2013-0215, dated September 16, 2013, for related information. You may examine the MCAI on the Internet at
Environmental Protection Agency (EPA).
Proposed rule.
EPA is proposing to approve the State of North Carolina's March 27, 2013, State Implementation Plan (SIP) revision to the State's approved Maintenance Plan for the Raleigh-Durham-Chapel Hill (Triangle) 1997 8-hour Ozone Maintenance Area. Specifically, North Carolina's revision, including updated modeling, shows that the Triangle Area would continue to maintain the 1997 8-hour ozone standard if the currently applicable Federal Reid Vapor Pressure (RVP) standard for gasoline from 7.8 pounds per square inch (psi) were modified to 9.0 psi for three portions (Wake and Durham Counties, and a portion of Granville County) of the “Triangle Area” of North Carolina during the high-ozone season. The State has included a technical demonstration with the revision to demonstrate that a less-stringent RVP standard of 9.0 psi in these areas would not interfere with continued maintenance of the 1997 8-hour Ozone National Ambient Air Quality Standards (NAAQS) or any other applicable standard. Approval of this SIP revision is a prerequisite for EPA's consideration of an amendment to the regulations to remove the aforementioned portions of the Triangle Area from the list of areas that are currently subject to the Federal 7.8 psi RVP requirements. In addition, EPA is also proposing to approve changes to the motor vehicle emission budgets (MVEBs) used in the 1997 8-hour ozone maintenance plan for the Triangle Area. The use of new models and the relaxation of the RVP requirement has resulted in a revised safety margin which North Carolina is reallocating among the MVEBs associated the Maintenance Plan. EPA has preliminarily determined that North Carolina's March 27, 2013, SIP revision with respect to the changes to the modeling and associated technical demonstration associated with the State's request for the removal of the Federal RVP requirements, and with respect to the updated MVEBs, is consistent with the applicable provisions of the Clean Air Act (CAA or Act). Should EPA decide to remove the subject portions of the Triangle Area from those areas subject to the 7.8 psi Federal RVP requirements, such action will occur in a subsequent rulemaking.
Written comments must be received on or before November 29, 2013.
Submit your comments, identified by Docket ID Number EPA-R04-OAR-2013-0563 by one of the following methods:
1.
2.
3.
4.
5.
Sean Lakeman of the Regulatory Development Section, in the Air Planning Branch, Air, Pesticides and Toxics Management Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth Street SW., Atlanta, Georgia 30303-8960. Mr. Lakeman may be reached by phone at (404) 562-9043, or via electronic mail at
The Triangle Area in North Carolina is currently designated attainment for the 1997 8-hour ozone NAAQS. The Area was redesignated from nonattainment of the 1997 8-hour ozone NAAQS on December 26, 2007.
The new modeling conducted by North Carolina to account for the proposed relaxation of the applicable RVP standard in a portion of the Triangle Area also results in changes to the safety margin associated with the maintenance plan.
This preamble is hereafter organized into five parts. Section II provides the background of the Triangle Area designation status with respect to the various Ozone NAAQS. Section III describes the applicable history of federal gasoline regulation. Section IV provides the Agency's policy regarding relaxation of the volatility standards. Section V provides EPA's analysis of the information submitted by North Carolina to support a relaxation of the more stringent volatility standard in the Triangle Area. Finally, Section VI describes the changes to the MVEBs associated with Maintenance Plan for the Triangle Area and provides EPA's analysis regarding the proposed revision.
In 1991, the Triangle Area was designated as a moderate nonattainment area pursuant to the 1-hour ozone NAAQS.
Following implementation of the 7.8 psi RVP requirement in the Triangle Area, on April 18, 1994, the Area was redesignated to attainment for the 1-hour ozone standard, based on 1989-1992 ambient air quality monitoring data.
On August 19, 1987 (52 FR 31274), EPA determined that gasoline nationwide had become increasingly volatile, causing an increase in evaporative emissions from gasoline-powered vehicles and equipment. Evaporative emissions from gasoline, referred to as volatile organic compounds (VOC), are precursors to the formation of tropospheric ozone and contribute to the nation's ground-level ozone problem. Exposure to ground-level ozone can reduce lung function (thereby aggravating asthma or other respiratory conditions), increase susceptibility to respiratory infection, and may contribute to premature death in people with heart and lung disease.
The most common measure of fuel volatility that is useful in evaluating gasoline evaporative emissions is RVP. Under section 211(c) of CAA, EPA promulgated regulations on March 22, 1989 (54 FR 11868), that set maximum limits for the RVP of gasoline sold during the high ozone season. These regulations constituted Phase I of a two-phase nationwide program, which was designed to reduce the volatility of commercial gasoline during the high ozone season. On June 11, 1990 (55 FR 23658), EPA promulgated more stringent volatility controls as Phase II of the volatility control program. These requirements established maximum RVP standards of 9.0 psi or 7.8 psi (depending on the State, the month, and the area's initial ozone attainment
The 1990 CAA Amendments established a new section, 211(h), to address fuel volatility. Section 211(h) requires EPA to promulgate regulations making it unlawful to sell, offer for sale, dispense, supply, offer for supply, transport, or introduce into commerce gasoline with an RVP level in excess of 9.0 psi during the high ozone season. Section 211(h) prohibits EPA from establishing a volatility standard more stringent than 9.0 psi in an attainment area, except that we may impose a lower (more stringent) standard in any former ozone nonattainment area redesignated to attainment.
On December 12, 1991 (56 FR 64704), EPA modified the Phase II volatility regulations to be consistent with section 211(h) of the CAA. The modified regulations prohibited the sale of gasoline with an RVP above 9.0 psi in all areas designated attainment for ozone, beginning in 1992. For areas designated as nonattainment, the regulations retained the original Phase II standards published on June 11, 1990 (55 FR 23658).
As stated in the preamble to the Phase II volatility controls and reiterated in the proposed change to the volatility standards published in 1991, EPA will rely on states to initiate changes to EPA's volatility program that they believe will enhance local air quality and/or increase the economic efficiency of the program within the limits of CAA section 211(h).
As explained in the December 12, 1991 (56 FR 64704), Phase II rulemaking, EPA believes that relaxation of an applicable RVP standard in a nonattainment area is best accomplished in conjunction with the redesignation process. In order for an ozone nonattainment area to be redesignated as an attainment area, section 107(d)(3) of the Act requires the state to make a showing, pursuant to section 175A of the Act, that the area is capable of maintaining attainment for the ozone NAAQS for ten years after redesignation. Depending on the area's circumstances, this maintenance plan will either demonstrate that the area is capable of maintaining attainment for ten years without the more stringent volatility standard or that the more stringent volatility standard may be necessary for the area to maintain its attainment with the ozone NAAQS. Therefore, in the context of a request for redesignation, EPA will not relax the volatility standard unless the state requests a relaxation and the maintenance plan demonstrates, to the satisfaction of EPA, that the area will maintain attainment for ten years without the need for the more stringent volatility standard. As noted above, however, North Carolina did not request relaxation of the applicable 7.8 psi RVP standard when the Triangle Area was redesignated to attainment for the either the 1-hour or the 1997 8-hour ozone NAAQS. Rather, North Carolina is now seeking to relax the 7.8 psi RVP standard after the Triangle Area has been redesignated to attainment for the 1997 8-hour ozone NAAQS. Accordingly, the original modeling and maintenance demonstration supporting the 1997 8-hour ozone maintenance plan must be revised to reflect continued attainment under the relaxed 9.0 psi RVP standard that the State has requested.
Section 110(l) requires that a revision to the SIP not interfere with any applicable requirement concerning attainment and reasonable further progress (RFP) (as defined in section 171), or any other applicable requirement of the Act. EPA's criterion for determining the approvability of North Carolina's March 27, 2013, SIP revision is whether this requested action complies with section 110(l) of the CAA. Because the modeling associated with the current maintenance plan for North Carolina is premised in part upon the 7.8 psi RVP requirements, a request to revise the maintenance plan modeling to no longer rely on the 7.8 psi RVP requirement is subject to the requirements of CAA section 110(l). Therefore, the State must demonstrate that this revision will not interfere with the attainment or maintenance of any of the NAAQS or any other applicable requirement of the CAA.
This section 110(l) non-interference demonstration is a case-by-case determination based upon the circumstances of each SIP revision. EPA interprets 110(l) as applying to all NAAQS that are in effect, including those that have been promulgated but for which the EPA has not yet made designations. The specific elements of the 110(l) analysis contained in the SIP revision depend on the circumstances and emissions analyses associated with that revision. EPA's analysis of North Carolina's March 27, 2013, SIP revision, including review of section 110(l) requirements is provided below.
Finally, EPA notes that this rulemaking is only proposing to approve the State's revision to its existing maintenance plan for the Triangle Area showing that the area can continue to maintain the standard without relying upon gasoline with an RVP of 7.8 psi being sold in the Triangle area during the high ozone season. Consistent with CAA section 211(h) and the Phase II volatility regulations a separate rulemaking is required for relaxation of the current requirement to use gasoline with an RVP of 7.8 psi in the Triangle area.
As discussed above, on March 27, 2013, NC DENR submitted a revision to the existing maintenance plan for the Triangle 1997 8-hour ozone maintenance area. Specifically, NC DENR revised the modeling for on-road mobile, off-road mobile, and area source emissions. The modeling was revised to show the emission changes that would result from relaxing the gasoline RVP requirement from 7.8 psi to 9.0 psi for the Triangle Area during the high ozone season. North Carolina's March 27, 2013, SIP revision also included an evaluation of the impact that the removal of the 7.8 psi RVP requirement would have on maintenance of the 1997 and 2008 ozone standards and on other applicable NAAQS. For the purposes of this proposed change to the applicable RVP requirement, EPA is making the preliminary determination that the relevant NAAQS
VOC and NO
There are no emissions reductions attributable to the emissions of lead and sulfur dioxide (SO
To determine the emissions reviewed in the technical demonstration included with the March 27, 2013, SIP revision, NC DENR compared the 2005 baseline emissions inventory to the 2017 projected emissions inventory. The baseline emissions inventory represents an emission level for a period when the applicable ambient air quality standard was not violated, 2004-2006. NC DENR concluded that if projected emissions remain at or below the baseline emissions, continued maintenance is demonstrated and the ambient air quality standard should not be violated in the future. In addition to comparing the final year of the maintenance plan, NC DENR's technical demonstration also compares all of the interim years to the 2005 baseline to demonstrate that these years are also expected to show continued maintenance of all NAAQS.
Also, in North Carolina's March 27, 2013, SIP revision, NC DENR provided an updated analysis utilizing the MOVES model to calculate on-road emissions that are used as part of the evaluation of the potential impacts for the ozone NAAQS that might result exclusively from changing the high ozone season RVP requirements from 7.8 psi to the requirement of 9.0 psi. Relaxation of the RVP standard from 7.8 psi to 9.0 psi revealed a slight increase in emissions of 0.30 tons per day (tpd) (a 0.20 percent increase) in NO
There are four different man-made emission inventory source classifications; 1) point, 2) area, 3) on-road mobile and 4) off-road mobile. Point sources are those stationary sources that emit more than 10 tons per year of VOC or 100 tons per year of NO
Despite the small increases in emissions from the change to the RVP control, the Triangle Area continues to demonstrate a downward trend in NO
As Table 1 and 2 indicate, NO
Effective June 15, 2004, the Triangle Area was designated as nonattainment for the 1997 8-hour ozone NAAQS. The primary precursors for ozone are VOC and NO
On June 7, 2007, NC DENR submitted a redesignation request and maintenance plan for the 1997 8-hour ozone NAAQS. NC DENR used the MOBILE6.2 mobile source emissions model to estimate the emissions for on-road sources and NONROAD2005c non-road mobile model for off-road sources. In the years 2014 and 2017, NC DENR projected a reduction from the 2005 base year inventory of approximately 38 percent and 45 percent (respectively) in NO
There is an overall downward trend in ozone concentration in the Triangle Area that can be attributed to Federal and State programs that have led to significant emissions reductions. On December 26, 2007, (72 FR 72948), EPA approved North Carolina's 1997 8-hour ozone maintenance plan for the Triangle Area, and redesignated the Area to attainment for the 1997 8-hour ozone NAAQS. The Triangle Area is continuing to meet the 1-hour and 1997 8-hour ozone NAAQS,
As mentioned above, on December 26, 2007 (72 FR 72948), EPA approved North Carolina's June 7, 2007, maintenance plan for the Triangle Area. This maintenance plan contained MVEBs for NO
In addition, North Carolina conducted a emissions sensitivity analysis that indicated that 1997 and 2008 8-hour ozone levels in the Triangle Area were not impacted by reductions in man-made VOC emissions (e.g., reductions from motor vehicles). Specifically, the photochemical model was run for a 39-day scenario in 2009 with a 30 percent reduction in all man-made VOC emissions. In addition, two mobile
The current design value for ozone for the Triangle Area for 2010-2012 is 0.075 ppm and the preliminary 2011-2013 design value is 0.071 ppm for this Area. EPA also evaluated the potential increase in the VOC and NO
In light of the current designations, monitoring and emissions data, and the submitted modeling, including the fact that the NO
The precursors for PM
Sulfates are formed through the chemical reaction of SO
On July 18, 1997 (62 FR 38652), EPA established an annual PM
On January 5, 2005 (70 FR 944), all counties in the Triangle Area were designated unclassifiable/attainment for the 1997 annual PM
In light of the fact that a change to the NC Maintenance Plan to no longer rely on gasoline with a 7.8 psi RVP requirement will only result in a slight increase in VOC and NO
On February 17, 2012 (77 FR 9532), EPA finalized designations for 2010 NO
In light of the current designation, monitoring and emissions trend data and the submitted modeling, including the fact that NO
Durham and Wake Counties in the Triangle Area were previously designated nonattainment for the 8-hour CO NAAQS.
Based upon the revised modeling associated with the proposed relaxation of the RVP standard in the three portions of the Triangle Area currently subject to the more stringent standard, it is estimated that Triangle Area on-road CO emissions will increase approximately 6.3 tons per day in 2014 and 2017. This projected increase represents an increase in the total inventory of less than 1 percent.
In light of the slight increase in CO emissions, and the existing air quality data showing a wide margin of compliance with the CO NAAQS, EPA has preliminarily determined that a change to the Federal RVP requirement for Durham, Granville and Wake Counties would not interfere with the Raleigh-Durham Area maintaining the CO standards. As Table 5 above indicates the CO design value is well below the standard.
On June 7, 2007, the State of North Carolina, through NC DENR, submitted a final request for EPA to: (1) Redesignate the Triangle Area to attainment for the 1997 8-hour ozone standard; and (2) approve a North Carolina SIP revision containing a maintenance plan for the Triangle Area. On December 26, 2007 (72 FR 72948), EPA approved the redesignation request for the Triangle Area. Additionally, EPA approved the 1997 8-hour ozone maintenance plan including NO
At the time of original redesignation request, the on-road motor vehicle inventory was generating by the MOBILE6.2 model, which at the time was the current MVEB model. The proposed change to the maintenance plan discussed above includes a MVEB generated by the MOVES model which has since replaced MOBILE6.2 model. In addition, the model used to calculate the original non-road inventory (NONROAD2005c) has also since been updated by a new non-road inventory model (NONROAD2008a).
As a result of these new models and the revised emission associated with a relaxed RVP standard, the safety margin
As discussed above, the on-road motor vehicle emissions in the revised maintenance plan are calculated using the MOVES model. The MOVES model uses the road class vehicle miles traveled (VMT) and other operating conditions as input parameters to generate an output file that contains estimated emissions. For the projected years inventories, the on-road mobile sources emissions are calculated by running the MOVES mobile model for the future year with the projected VMT to generate emissions that take into consideration expected Federal tailpipe standards, fleet turnover and new fuel standards.
Table 7 shows the on-road Chatham, Franklin, Johnston, Orange and Person Counties emissions based on the current RVP of 9.0 psi and the on-road Wake, Durham, and Granville Counties emissions based on the current RVP of 7.8 psi. Table 8 shows the on-road emissions data for Durham, Granville and Wake Counties for 2005, 2008 and 2011 based on 7.8 psi and the comparison of the projected 2014 and 2017 emissions based on a RVP relaxation to 9.0 psi for the three counties.
In the original 2007 redesignation demonstration and maintenance plan, the model used to generate off-road emissions was the NONROAD2005c model. Since 2007, EPA has updated the non-road model to NONROAD2008a. NONROAD2008a is the latest USEPA approved non-road model. In this revision, the NONROAD2008a model is used to generate non-road emissions for all inventory years—2005, 2008, 2011, 2014, and 2017. Also, the non-road emissions documentation includes the general conformity analysis for two new nuclear generating units at Duke-Progress Energy Company in Wake County.
In the March 27, 2013, SIP revision, North Carolina provided an increase for the amount of safety margins allocated to the NO
NC DENR is currently allocating portions of the available safety margin to the MVEBs to allow for unanticipated VMT growth as well as changes to future vehicle mix assumptions that influence the emission estimations. In the March 2013 SIP revision, North Carolina is seeking to adjust the safety margins. The following tables provide the adjusted NO
A total of 14,396 kg (15.87 tpd) and 13,563 kg (14.95 tpd) from the available NO
As demonstrated above, the Triangle Area is projected to steadily decrease its total NO
EPA is proposing to approve the State of North Carolina's March 27, 2013, revision to its Maintenance Plan for the Triangle 1997 8-hour Ozone Maintenance Area. Specifically, EPA is proposing to approve the State's showing that the Triangle Area can continue to maintain the 1997 ozone standard without emissions reductions associated with the use of 7.8 psi RVP gasoline in the three portions of the Triangle Area currently subject to the 7.8 psi RVP standard during the high ozone season—June 1 through September 15.
EPA proposes to approve the revised and updated modeling submitted by the State, which shows that the Triangle Area can continue to maintain the 1997 ozone standard if the applicable RVP standard in the three portions of the Triangle Area, the North Carolina revision is changed. EPA is also proposing to approve the revised NO
EPA has preliminarily determined that North Carolina's March 27, 2013, SIP revision, including the technical demonstration associated with the State's request for the removal of the Federal RVP requirements, and the updated MVEBs are consistent with the applicable provisions of the CAA. Should EPA decide to remove the subject portions of the Triangle Area from those areas subject to the 7.8 psi Federal RVP requirements, such action will occur in a separate, subsequent rulemaking.
Under the CAA, the Administrator is required to approve a SIP submittal 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 CAA. Accordingly, this proposed 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 proposed action:
• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Order 12866 (58 FR 51735, October 4, 1993);
• Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501
• 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
• 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, October 7, 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
• Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).
In addition, this proposed rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law.
Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Lead, Reporting and recordkeeping requirements.
42 U.S.C. 7401
Coast Guard, DHS.
Notice of availability and request for comments.
The Coast Guard announces the availability of a proposed policy letter concerning the carriage of shale gas extraction waste water in bulk via barge, and invites public comment. The policy letter specifies the conditions under which a barge owner may request and be granted a Certificate of Inspection endorsement or letter allowing the barge to transport shale gas extraction waste water in bulk. The policy letter also defines the information the Coast Guard may require the barge owner to provide and specifies the additional requirements the Coast Guard is considering imposing on such barges. Upon reviewing comments received on this proposed policy letter, Coast Guard will issue the final policy letter and specify its effective date.
Comments and related material must either be submitted to our online docket via
You may submit comments identified by docket number USCG-2013-0915 using any one of the following methods:
(1)
(2)
(3)
(4)
To avoid duplication, please use only one of these four methods. See the “Public Participation and Request for Comments” portion of the
If you have questions on this notice, call or email Dr. Cynthia A. Znati, Office of Design and Engineering Standards, Hazardous Materials Division, U.S. Coast Guard; telephone 202-372-1412, email
We encourage you to submit comments and related material on the proposed policy letter concerning the carriage of conditionally permitted shale gas extraction waste water in bulk. In particular, we specifically request public comment regarding the disclosure of proprietary information to the Coast Guard, and regarding the applicability of testing requirements for radioactive materials to all regions where shale gas extraction waste water may be transported by barge. All comments received will be posted, without change, to
To submit your comment online, go to
This notice is issued under authority of 5 U.S.C. 552(a). The purpose of this notice is to announce the availability of the Coast Guard's proposed policy letter entitled “Carriage of Conditionally Permitted Shale Gas Extraction Waste Water in Bulk,” and to request public comments on the policy the letter describes. The policy letter specifies the conditions under which a barge owner may request and be granted a Certificate of Inspection endorsement or letter, under 46 CFR part 153, allowing the barge to transport shale gas extraction waste water (SGEWW) in bulk as Conditionally Permitted SGEWW. The policy letter also defines the information the Coast Guard may require the barge owner to provide and specifies the additional requirements the Coast Guard is considering imposing on such barges.
SGEWW is a by-product of drilling for natural gas using unconventional hydraulic fracturing technology, which involves the injection of water, sand, and chemical additives. The sand remains in the well but a substantial portion of the injected fluid re-surfaces after the drilling and must be handled as SGEWW. At present, this SGEWW is either stored at the drilling site or transported by rail or truck to remote storage or reprocessing centers. There is commercial interest in transporting SGEWW from northern Appalachia via inland waterways to storage or reprocessing centers and final disposal sites in Ohio, Texas, and Louisiana.
Pursuant to 46 CFR 153.900(a) and (c), under certain circumstances a bulk liquid hazardous material may be transported by a tank vessel if it is a “listed cargo” (listed in any of several specified tables in Coast Guard regulations). SGEWW, however, cannot be treated as a “listed cargo” because the specific chemical composition of SGEWW varies from one consignment load to another and may contain one or more hazardous materials as defined in 46 CFR 153.2, including radioactive isotopes such as radium-226 and radium-228. Variables affecting the chemical composition of SGEWW include the chemicals present in the initial drilling fluid, the specific site being drilled, and the age of the well. In addition, each load can be a mixture of SGEWW from different wells.
Upon reviewing comments received on this proposed policy letter, Coast Guard will issue the final policy letter and specify its effective date.
The Department of Agriculture will submit the following information collection requirement(s) to OMB for review and clearance under the Paperwork Reduction Act of 1995, Public Law 104-13 on or after the date of publication of this notice. Comments regarding (a) Whether the collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (b) the accuracy of the agency's estimate of burden including the validity of the methodology and assumptions used; (c) ways to enhance the quality, utility and clarity of the information to be collected; (d) ways to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology should be addressed to: Desk Officer for Agriculture, Office of Information and Regulatory Affairs, Office of Management and Budget (OMB), New Executive Office Building, Washington, DC; New Executive Office Building, 725 17th Street NW., Washington, DC 20503. Commenters are encouraged to submit their comments to OMB via email to:
Comments regarding these information collections are best assured of having their full effect if received by November 29, 2013. Copies of the submission(s) may be obtained by calling (202) 720-8681.
An agency may not conduct or sponsor a collection of information unless the collection of information displays a currently valid OMB control number and the agency informs potential persons who are to respond to the collection of information that such persons are not required to respond to the collection of information unless it displays a currently valid OMB control number.
The Department of Agriculture has submitted the following information collection requirement(s) to OMB for review and clearance under the Paperwork Reduction Act of 1995, Public Law 104-13. Comments regarding (a) whether the collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (b) the accuracy of the agency's estimate of burden including the validity of the methodology and assumptions used; (c) ways to enhance the quality, utility and clarity of the information to be collected; (d) ways to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.
Comments regarding this information collection received by November 29, 2013 will be considered. Written comments should be addressed to: Desk Officer for Agriculture, Office of Information and Regulatory Affairs, Office of Management and Budget (OMB), New Executive Office Building, 725 17th Street NW., Washington, DC 20502. Commenters are encouraged to submit their comments to OMB via email to:
An agency may not conduct or sponsor a collection of information unless the collection of information displays a currently valid OMB control number and the agency informs potential persons who are to respond to the collection of information that such persons are not required to respond to the collection of information unless it displays a currently valid OMB control number.
The Department of Agriculture has submitted the following information collection requirement(s) to OMB for review and clearance under the Paperwork Reduction Act of 1995, Public Law 104-13. Comments regarding (a) Whether the collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
Comments regarding this information collection received by November 29, 2013 will be considered. Written comments should be addressed to: Desk Officer for Agriculture, Office of Information and Regulatory Affairs, Office of Management and Budget (OMB), New Executive Office Building, 725 17th Street NW., Washington, DC 20502. Commenters are encouraged to submit their comments to OMB via email to:
An agency may not conduct or sponsor a collection of information unless the collection of information displays a currently valid OMB control number and the agency informs potential persons who are to respond to the collection of information that such persons are not required to respond to the collection of information unless it displays a currently valid OMB control number.
Forest Service, USDA.
Notice; correction.
On December 15, 2000, the USDA Forest Service published a notice of intent (NOI) in the
(1) Complete the analysis of effects on the Management Indicator Species population trend for ptarmigan.
(2) Strengthen the disclosure of cumulative effects to wildlife species.
(3) Address the concern about the use of picloram in municipal watersheds.
On September 10, 2009, the USDA Forest Service published a corrected NOI in the
The DSEIS will be posted on these Web sites:
Carson National Forest:
Santa Fe National Forest:
A limited number of paper copies will be available upon request from either forest: Carson Forest Supervisor's Office, 208 Cruz Alta Road, Taos, NM 87571, Attn: Planning; or Santa Fe National Forest Supervisor's Office, 11 Forest Lane, Santa Fe, NM 87508, Attn: Julie Bain. The address to which to send comments will be published with the DSEIS.
Julie Bain, Forest Environmental Coordinator, Santa Fe National Forest Supervisor's Office, 11 Forest Lane, Santa Fe, NM 87508, (505) 438-5443,
An SEIS is needed to update certain elements of the analysis and correct deficiencies identified in the 2005 Invasive Plant Control Project Final Environmental Impact Statement and records of decision. The DSEIS will document the analysis of effects for the same range of alternatives as the 2005 final EIS. The proposed action, which includes the use of herbicides to control invasive species, remains the preferred alternative. The Forest Supervisors of the Carson and Santa Fe National Forests are the responsible officials. Each responsible
Forest Service, USDA.
Notice of meetings.
The Virginia Resource Advisory Committee will meet in Roanoke, Virginia. The committee is authorized under the Secure Rural Schools and Community Self-Determination Act (Pub. L. 110-343) (the Act) and operates in compliance with the Federal Advisory Committee Act. The purpose of the committee is to improve collaborative relationships and to provide advice and recommendations to the Forest Service concerning projects and funding consistent with Title II of the Act. The meeting is open to the public. The purpose of the meeting is to prioritize and recommend projects for funding.
The meetings will be held on Fridays between December 6, 2013 and February 7, 2014 from 10 a.m. to 6 p.m. Exact meeting dates are:
• December 6, 2013: 10 a.m. to 6 p.m.
• December 13, 2013: 10 a.m. to 6 p.m.
• January 10, 2014: 10 a.m. to 6 p.m.
• January 17, 2014: 10 a.m. to 6 p.m.
• January 24, 2014: 10 a.m. to 6 p.m.
• January 31, 2014: 10 a.m. to 6 p.m.
• February 7, 2014: 10 a.m. to 6 p.m.
All Resource Advisory Committee meetings are subject to change or cancellation. Contact Michael Williams, Public Affairs Specialist, Supervisor's Office, 540-265-5173,
The meeting will be held at the George Washington and Jefferson National Forests Supervisor's Office conference room at 5162 Valleypointe Parkway, Roanoke, Virginia 24019. Written comments may be submitted as described under Supplementary Information. All comments, including names and addresses when provided, are placed in the record and are available for public inspection and copying. The public may inspect comments received at the George Washington and Jefferson National Forest Supervisor's Office. Please call ahead to 540-265-5100 to facilitate entry into the building.
Michael Williams, Public Affairs Specialist, Supervisor's Office, 540-265-5173,
Additional information on the Virginia Resource Advisory Committee can be found by visiting the George Washington and Jefferson National Forests' Web site at:
National Agricultural Statistics Service, USDA.
Notice and request for comments.
In accordance with the Paperwork Reduction Act of 1995, this notice announces the intention of the National Agricultural Statistics Service (NASS) to request revision and extension of a currently approved information collection, the Equine Survey. Revision to burden hours may be needed due to changes in the size of the target population, sampling design, and/or questionnaire length.
Comments on this notice must be received by December 30, 2013 to be assured of consideration.
You may submit comments, identified by docket number 0535-0227, by any of the following methods:
•
•
•
•
Joseph T. Reilly, Associate Administrator, National Agricultural Statistics Service, U.S. Department of Agriculture, (202) 720-4333. Copies of this information collection and related instructions can be obtained without charge from David Hancock, NASS Clearance Officer, at (202) 690-2388.
Bureau of the Census, Commerce.
Notice of Determination.
The Bureau of the Census (Census Bureau) is conducting the 2013 Company Organization Survey. The survey's data are needed, in part, to update the multilocation companies in the Business Register. The survey, which has been conducted annually since 1974, is designed to collect information on the number of employees, payroll, geographic location, current operational status, and kind of business for each establishment of companies with more than one location. We have determined that annual data collected from this survey are needed to aid the efficient performance of essential governmental functions, and that these data have significant application to the needs of the public and industry. The data derived from this survey are not available from any other source.
The Census Bureau will furnish report forms to organizations included in the survey, and additional copies are available upon written request to the Director, U.S. Census Bureau, Washington, DC 20233-0101.
Joy P. Pierson, Economic Planning and Coordination Division, U.S. Census Bureau, Room 8K319, Washington, DC 20233-6100 or by email at
Sections 182, 224, and 225 of Title 13, United States Code (U.S.C.), authorize the Census Bureau to undertake surveys necessary to furnish current data on the subjects covered by the major censuses. Years that end in 2 and 7 are considered “census years.” In non-census years, companies report only on basic company affiliation and operations of establishments not within the scope of the economic censuses. In these non-census years, all multi-establishment companies with 250 or more employees report survey information. Also, groups of smaller companies that are divided into panels may be selected to report information for one of the non-census years. Smaller companies may be selected if an organizational change within the company is indicated, or if they have been selected through the probability sampling procedure. The next economic census will be conducted for the year 2017. The data collected in the Company Organization Survey will be within the general scope, type, and character of those that are covered in the economic censuses. Forms NC-99001 (for multi-establishment companies) and NC-99007 (for single-location companies) will be used to collect the desired data.
Notwithstanding any other provision of law, no person is required to respond to, nor shall a person be subject to a penalty for failure to comply with a collection of information subject to the requirements of the Paperwork Reduction Act unless that collection of
I have, therefore, directed that the 2013 Company Organization Survey be conducted for the purpose of collecting these data.
Bureau of the Census, Department of Commerce.
Notice of determination.
The United States Department of Commerce's Bureau of the Census (Census Bureau) publishes this notice to announce that the Director of the Census Bureau has determined the need to conduct the 2013 Annual Retail Trade Survey (ARTS). ARTS covers employer firms with establishments located in the United States and classified in the Retail Trade and/or Accommodation and Food Services sectors as defined by the 2007 North American Industry Classification System (NAICS). Through this survey, the Census Bureau will collect data covering annual sales, annual e-commerce sales, year-end inventories held inside and outside the United States, total operating expenses, purchases, accounts receivables, and, for selected industries, merchandise line sales. These data are collected to provide a sound statistical basis for the formation of policy by various government agencies. Results will be available for use for a variety of public and business needs such as economic and market analysis, company performance, and forecasting future demand. The Census Bureau conducts the ARTS to provide continuing and timely national statistical data on retail trade, and accommodation and food services activity annually.
The Census Bureau will provide report forms to businesses included in the survey. Additional copies are available upon written request to the Director, U.S. Census Bureau, Washington, DC 20233-0101.
Aneta Erdie, Service Sector Statistics Division, at (301) 763-4841 or by email at
Sections 182, 224, and 225 of Title 13 of the United States Code (U.S.C.) authorize the Census Bureau to take surveys that are necessary to produce current data on the subjects covered by the major censuses. As part of this authorization, the Census Bureau conducts the ARTS to provide continuing and timely national statistical data on retail trade, and accommodation and food services activity for the period between economic censuses. ARTS is a continuation of similar retail trade surveys conducted each year since 1951 (except 1954). ARTS covers employer firms with establishments located in the United States and classified in the Retail Trade and/or Accommodation and Food Services sectors as defined by the 2007 North American Industry Classification System (NAICS). ARTS provides, on a comparable classification basis, annual sales, annual e-commerce sales, year-end inventories held inside and outside the United States, total operating expenses, purchases, accounts receivables, and, for selected industries, merchandise line sales for 2013. The Census Bureau has determined that the conduct of this survey is necessary because these data are not available publicly on a timely basis from any other sources.
Firms are selected for the ARTS survey using a stratified random sample based on industry groupings and annual sales size. We will provide report forms to the firms covered by this survey in February 2014, and will require their responses within 50 days after receipt. Firms' responses to the ARTS survey are required by law (Title 13 U.S.C. Sections 182, 224, and 225). The sample of firms selected will provide, with measurable reliability, statistics on annual sales, annual e-commerce sales, year-end inventories held inside and outside the United States, total operating expenses, purchases, accounts receivables, and, for selected industries, merchandise line sales for 2013.
The data collected in this survey will be similar to that collected in the past and within the general scope and nature of those inquiries covered in the economic census. These data are collected to provide a sound statistical basis for the formation of policy by various government agencies. Results will be available for use for a variety of public and business needs including economic and market analysis, company performance, and forecasting future demand.
Notwithstanding any other provision of law, no person is required to respond to, nor shall a person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the Paperwork Reduction Act (PRA) unless that collection of information displays a current valid Office of Management and Budget (OMB) control number. In accordance with the PRA, 44 U.S.C. 3501-3521, OMB has approved the Annual Retail Trade Survey under OMB Control Number 0607-0013.
Based upon the foregoing, I have directed that an annual survey be conducted for the purpose of collecting these data.
Pursuant to its authority under the Foreign-Trade Zones Act of June 18, 1934, as amended (19 U.S.C. 81a-81u), the Foreign-Trade Zones Board (the Board) adopts the following Order:
Enforcement and Compliance, formerly Import Administration, International Trade Administration, Department of Commerce.
The Department of Commerce (“the Department”) has received information sufficient to warrant initiation of a changed circumstances review of the antidumping duty order on certain new pneumatic off-the-road tires (“OTR tires”) from the People's Republic of China (“PRC”). Specifically, based upon a request filed by Shandong Linglong Tyre Co., Ltd. (“Shandong Linglong”), an exporter to the United States of subject merchandise, the Department is initiating a changed circumstances review to determine whether Shandong Linglong is the successor-in-interest to Zhaoyuan Leo Rubber Co., Ltd. (“Leo Rubber”), a separate-rate respondent in the original investigation.
Andrew Medley or Eugene Degnan, AD/CVD Operations, Office III, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW., Washington, DC 20230; telephone: 202-482-4987 or 202-482-0414, respectively.
On September 4, 2008, the Department published in the
On August 26, 2013, Shandong Linglong filed a submission requesting that the Department conduct a changed circumstances review of the
The merchandise covered by this
Pursuant to section 751(b)(1) of the Tariff Act of 1930, as amended (“the Act”), the Department will conduct a changed circumstances review upon receipt of information concerning, or a request from, an interested party for a review of an antidumping duty order which shows changed circumstances sufficient to warrant a review of the order. In the event that the Department determines that expedited action is warranted, 19 CFR 351.221(c)(3)(ii) permits the Department to combine the notices of initiation and preliminary results.
In accordance with 19 CFR 351.216(d), the Department has determined that the information submitted by Shandong Linglong constitutes sufficient evidence to conduct a changed circumstances review. In an antidumping duty changed circumstances review involving a successor-in-interest determination, the Department typically examines several factors including, but not limited to, changes in: (1) Management; (2) production facilities; (3) supplier relationships; and (4) customer base.
Based on the information provided in its submission, Shandong Linglong has provided sufficient evidence to warrant a review to determine if it is the successor-in-interest to Leo Rubber. Therefore, pursuant to section 751(b)(1) of the Act and 19 CFR 351.216(d), we
This notice is published in accordance with sections 751(b)(1) and 777(i) of the Act and 19 CFR 351.216(b) and 351.221(b)(1).
Enforcement and Compliance, formerly Import Administration, International Trade Administration, Department of Commerce.
On June 7, 2013, the Department of Commerce (the Department) published the preliminary results of the third administrative review of the antidumping duty order on citric acid and certain citrate salts from Canada.
Based on our analysis of the comments received, we have made no changes to our calculations. Therefore, the final results do not differ from the preliminary results. The final weighted-average dumping margin for JBL Canada is listed below in the “Final Results of Review” section of this notice.
Rebecca Trainor or Kate Johnson, AD/CVD Operations, Office II, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC, 20230; telephone (202) 482-4007 or (202) 482-4929, respectively.
The review covers one producer and exporter of the subject merchandise, JBL Canada. On June 7, 2013, the Department published in the
The merchandise covered by this order is citric acid and certain citrate salts. The product is currently classified in the Harmonized Tariff Schedule of the United States (HTSUS) at item numbers 2918.14.0000 and 2918.15.1000, 2918.15.5000 and 3824.90.9290. Although the HTSUS numbers are provided for convenience and customs purposes, the full written scope description, as published in the antidumping duty order
The POR is May 1, 2011, through April 30, 2012.
All issues raised in the case and rebuttal briefs by parties are addressed in the memorandum entitled, “Issues and Decision Memorandum for the Final Results of the 2011-2012 Antidumping Duty Administrative Review of Citric Acid and Certain Citrate Salts from Canada” (Issues and Decision Memo), which is dated concurrently with, and adopted by, this notice. A list of the issues which parties raised and to which we respond in the Issues and Decision Memo is attached to this notice as Appendix I. The Issues and Decision Memo is a public document and is on file electronically via Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (IA ACCESS). IA ACCESS is available to registered users at
Based on a review of the record and comments received from interested parties regarding our
We determine that a weighted-average dumping margin of 1.20 percent exists for entries of subject merchandise that were produced and/or exported by JBL Canada and that entered, or were withdrawn from warehouse, for consumption during the period May 1, 2011, through April 30, 2012.
Purusant to 19 CFR 351.212(b)(1), the Department shall determine, and U.S. Customs and Border Protection (CBP) shall assess, antidumping duties on all appropriate entries in accordance with the final results of this review.
As we stated in the
We will instruct CBP to assess antidumping duties on all appropriate entries covered by this review if any importer-specific assessment rate calculated in the final results of this review is above
The Department clarified its “automatic assessment” regulation on May 6, 2003.
The following cash deposit requirements will be effective for all shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date of the final results of this administrative review, as provided by section 751(a)(2)(C) of the Act: (1) The cash deposit rate for JBL Canada will be that established in the final results of this review, (2) for previously reviewed or investigated companies not participating in this review, the cash deposit rate will continue to be the company-specific rate published for the most recent period; (3) if the exporter is not a firm covered in this review, a previous review, or the original less-than-fair-value (LTFV) investigation, but the manufacturer is, the cash deposit rate will be the rate established for the most recent period for the manufacturer of the merchandise; and (4) the cash deposit rate for all other manufacturers or exporters will continue to be 23.21 percent, the all-others rate made effective by the LTFV investigation.
This notice also serves as a final reminder to importers of their responsibility under 19 CFR 351.402(f) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Secretary's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties.
In accordance with 19 CFR 351.305(a)(3), this notice serves as the only reminder to parties subject to administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under APO, which continues to govern business proprietary information in this segment of the proceeding. Timely written notification of the return or destruction of APO materials, or conversion to judicial protective order, is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation.
As explained in the memorandum from the Assistant Secretary for Enforcement and Compliance, the Department has exercised its discretion to toll deadlines for the duration of the closure of the Federal Government from October 1, through October 16, 2013.
This administrative review and notice are published in accordance with sections 751(a)(1) and 777(i)(1) of the Act.
Pursuant to Section 6(c) of the Educational, Scientific and Cultural Materials Importation Act of 1966 (Pub. L. 89-651, as amended by Pub. L. 106-36; 80 Stat. 897; 15 CFR part 301), we invite comments on the question of whether instruments of equivalent scientific value, for the purposes for which the instruments shown below are intended to be used, are being manufactured in the United States.
Comments must comply with 15 CFR 301.5(a)(3) and (4) of the regulations and be postmarked on or before November 19, 2013. Address written comments to Statutory Import Programs Staff, Room 3720, U.S. Department of Commerce, Washington, DC 20230. Applications may be examined between 8:30 a.m. and 5:00 p.m. at the U.S. Department of Commerce in Room 3720.
Enforcement and Compliance (Formerly Import Administration), International Trade Administration, Department of Commerce.
On April 9, 2013, the Department of Commerce (the Department) published in the
Jolanta Lawska at 202-482-8362 (for Borusan and Erbosan) at 202-482-8362 and John Conniff at 202-482-1009 (for Toscelik), AD/CVD Operations, Office III, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230.
On March 7, 1986, the Department published in the
The products covered by this order are certain welded carbon steel pipe and tube with an outside diameter of 0.375 inch or more, but not over 16 inches, of any wall thickness (pipe and tube) from Turkey. These products are currently provided for under the Harmonized Tariff Schedule of the United States (HTSUS) as item numbers 7306.30.10, 7306.30.50, and 7306.90.10. Although the HTSUS subheadings are provided for convenience and customs purposes, the written description of the merchandise is dispositive.
All issues raised in the case and rebuttal briefs by parties to this administrative review are addressed in the Final Decision Memorandum, dated concurrently with this notice and which is hereby adopted by this notice. A list of the issues which parties have raised, and to which we have responded in the Final Decision Memorandum, is attached to this notice as an Appendix. The Final Decision Memorandum is a public document and is on file electronically via IA ACCESS. IA ACCESS is available to registered users at
Consistent with the
The Department intends to issue assessment instructions to U.S. Customs and Border Protection (CBP) 15 days after the date of publication of these final results, to liquidate shipments of subject merchandise by Borusan and Erbosan entered, or withdrawn from warehouse, for consumption on or after January 1, 2011, through December 31, 2011, without regard to CVDs because a
For Toscelik, the Department intends to issue assessment instructions to CBP 15 days after the date of publication of these final results of review to liquidate shipments of subject merchandise by Toscelik entered, or withdrawn from warehouse, for consumption on or after January 1, 2011, through December 31, 2011, at the
For all non-reviewed companies, we will instruct CBP to continue to collect cash deposits at the most recent company-specific or country-wide rate applicable to the company. Accordingly, the cash deposit rates that will be applied to companies covered by this order, but not examined in this review, are those established in the most recently completed administrative proceeding for each company. The cash deposit rates for all companies not covered by this review are not changed by the results of this review, and remain in effect until further notice.
This notice also serves as a reminder to parties subject to administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of the return/destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation.
We are issuing and publishing these final results in accordance with sections 751(a)(1) and 777(i)(1) of the Act.
National Ocean Service (NOS), National Oceanic and Atmospheric
Notice of open meeting.
NOAA's Integrated Ocean Observing System (IOOS®) Program publishes this notice on behalf of the Interagency Ocean Observation Committee (IOOC) to announce a formal meeting of the IOOC's Data Management and Communications Steering Team (DMAC-ST). The DMAC-ST membership is comprised of IOOC-approved federal agency representatives and non-federal participants representing academic, non-profit, private, regional and state sectors who will discuss issues outlined in the agenda.
The meeting is scheduled for November 19, 2013, between 9 a.m. and 5 p.m. and November 20, 2013, between 9 a.m. and noon, Eastern Standard Time.
The meeting will be broadcast via a conference telephone call. Public access is available at the Consortium for Ocean Leadership, 1201 New York Avenue NW., 4th Floor, Washington, DC 20005.
For further information about this notice, please contact the U.S. IOOS Program (Charles Alexander, 301-427-2429,
The IOOC was established by Congress under the Integrated Coastal and Ocean Observation System Act of 2009 and created under the National Ocean Research Leadership Council (NORLC). The DMAC-ST was subsequently chartered by the IOOC in December 2010 to assist with technical guidance with respect to the management of ocean data collected under the U.S. IOOS®. The IOOC's Web site (
33 U.S.C. 3601-3610.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Notice; proposed incidental harassment authorization; request for comments.
NMFS has received an application from the Partnership for Interdisciplinary Study of Coastal Oceans (PISCO) at the University of California (UC) Santa Cruz for an Incidental Harassment Authorization (IHA) to take marine mammals, by harassment, incidental to rocky intertidal monitoring surveys. Pursuant to the Marine Mammal Protection Act (MMPA), NMFS is requesting comments on its proposal to issue an IHA to PISCO to incidentally take, by Level B harassment only, marine mammals during the specified activity.
Comments and information must be received no later than November 29, 2013.
Comments on the application should be addressed to Michael Payne, Chief, Permits and Conservation Division, Office of Protected Resources, National Marine Fisheries Service, 1315 East-West Highway, Silver Spring, MD 20910. The
An electronic copy of the application containing a list of the references used in this document and associated Environmental Assessment (EA) may be obtained by writing to the address specified above, telephoning the contact listed below (see
Candace Nachman, Office of Protected Resources, NMFS, (301) 427-8401.
Sections 101(a)(5)(A) and (D) of the MMPA (16 U.S.C. 1361
Authorization for incidental takings shall be granted if NMFS finds that the taking will have a negligible impact on the species or stock(s), will not have an unmitigable adverse impact on the availability of the species or stock(s) for subsistence uses (where relevant), and if the permissible methods of taking, other means of effecting the least practicable impact on the species or stock and its habitat, and requirements pertaining to the mitigation, monitoring and reporting of such takings are set forth. NMFS has defined “negligible impact” in 50 CFR 216.103 as “. . .an impact resulting from the specified activity that cannot be reasonably expected to, and is not reasonably likely to, adversely affect the species or stock through effects on annual rates of recruitment or survival.”
Section 101(a)(5)(D) of the MMPA established an expedited process by which citizens of the United States can apply for an authorization to incidentally take small numbers of marine mammals by harassment. Section 101(a)(5)(D) establishes a 45-day time limit for NMFS review of an application followed by a 30-day public notice and comment period on any proposed authorizations for the incidental harassment of marine mammals. Within 45 days of the close of the comment period, NMFS must either issue or deny the authorization. Except with respect to certain activities not pertinent here, the MMPA defines “harassment” as: “any act of pursuit, torment, or annoyance which (i) has the potential to injure a marine mammal or marine mammal stock in the wild [Level A harassment]; or (ii) has the potential to disturb a marine mammal or marine mammal stock in the wild by causing disruption of behavioral patterns, including, but not limited to, migration, breathing, nursing, breeding, feeding, or sheltering [Level B harassment].”
On July 10, 2013, NMFS received an application from PISCO for the taking of marine mammals incidental to rocky intertidal monitoring surveys along the Oregon and California coasts. NMFS determined that the application was adequate and complete on July 31, 2013. In December 2012, NMFS issued a 1-year IHA to PISCO to take marine mammals incidental to these same proposed activities (77 FR 72327, December 5, 2012). This IHA will expire on December 2, 2013.
The research group at UC Santa Cruz operates in collaboration with two large-scale marine research programs: PISCO and the Multi-agency Rocky Intertidal Network. The research group at UC Santa Cruz (PISCO) is responsible for many of the ongoing rocky intertidal monitoring programs along the Pacific coast. Monitoring occurs at rocky intertidal sites, often large bedrock benches, from the high intertidal to the water's edge. Long-term monitoring projects include Community Structure Monitoring, Intertidal Biodiversity Surveys, Marine Protected Area Baseline Monitoring, Intertidal Recruitment Monitoring, and Ocean Acidification. Research is conducted throughout the year along the California and Oregon coasts and will continue indefinitely. Most sites are sampled one to two times per year over a 4-6 hour period during a negative low tide series. This IHA, if issued, though, would only be effective for a 12-month period from the date of its issuance. The following specific aspects of the proposed activities are likely to result in the take of marine mammals: presence of survey personnel near pinniped haulout sites and approach of survey personnel towards hauled out pinnipeds. Take, by Level B harassment only, of individuals of three species of marine mammals is anticipated to result from the specified activity.
PISCO focuses on understanding the nearshore ecosystems of the U.S. west coast through a number of interdisciplinary collaborations. PISCO integrates long-term monitoring of ecological and oceanographic processes at dozens of sites with experimental work in the lab and field. A short description of each project is contained here. Additional information can be found in PISCO's application (see
Community Structure Monitoring involves the use of permanent photoplot quadrats which target specific algal and invertebrate assemblages (e.g. mussels, rockweeds, barnacles). Each photoplot is photographed and scored for percent cover. The Community Structure Monitoring approach is based largely on surveys that quantify the percent cover and distribution of algae and invertebrates that constitute these communities. This approach allows researchers to quantify both the patterns of abundance of targeted species, as well as characterize changes in the communities in which they reside. Such information provides managers with insight into the causes and consequences of changes in species abundance. Each Community Structure site is surveyed over a 1-day period during a low tide series one to two times a year. Sites, location, number of times sampled per year, and typical sampling months for each site are presented in Table 1 in PISCO's application (see
Biodiversity Surveys, which are part of a long-term monitoring project and are conducted every 3-5 years at established sites, involve point contact identification along permanent transects, mobile invertebrate quadrat counts, sea star band counts, and tidal height topographic measurements. Table 2 in PISCO's application (see
In September 2007, the state of California began establishing a network of Marine Protected Areas along the California coast as part of the Marine Life Protection Act (MLPA). Under baseline monitoring programs funded by Sea Grant and the Ocean Protection Council, PISCO established additional intertidal monitoring sites in the Central Coast (Table 3 in PISCO's application), North Central Coast (Table 4 in PISCO's application), and South Coast (Table 5 in PISCO's application) study regions. Baseline characterization of newly established areas involves sampling of these new sites, as well as established sites both within and outside of marine protected areas. These sites were sampled using existing Community Structure and Biodiversity protocols for consistency. Resampling of newly established sites may take place every 5 years as part of future marine protected area evaluation.
Intertidal recruitment monitoring collects data on invertebrate larval recruitment. Mussel and other bivalve recruits are collected in mesh pot-scrubbers bolted into the substrate. Barnacle recruits and cyprids are collected on PVC plates covered in non-slip tape and bolted to the substrate. Both are collected once a month and processed in the lab. Intertidal recruitment monitoring is currently conducted on a monthly basis at two central California sites: Terrace Point and Hopkins.
The Ocean Margin Ecosystems Group for Acidification Studies is a National Science Foundation funded project that involves research at eight sites along the California Current upwelling system from Southern California into Oregon. PISCO is responsible for research at three of these sites—Hopkins, Terrace Point, and Soberanes—located in the Monterey Bay region of mainland California. The intention of this collaboration is to monitor oceanic pH on large spatial and temporal scales and to determine if any relationship exists between changing ocean chemistry and the state of intertidal calcifying organisms. The project involves field experiments, as well as lab studies. Currently these sites are visited two to three times per month for sampling and equipment maintenance.
During summer 2014, PISCO will sample eight sites along the Oregon coast (see Table 7 in PISCO's application) using a combination of community structure and biodiversity survey methods to establish a baseline prior to the proposed installation of several wave energy conversion device arrays. This baseline will be used to assess the effects of the arrays on nearshore communities.
PISCO's research is conducted throughout the year along the California and Oregon coasts. Most sites are sampled one to two times per year over a 1-day period (4-6 hours per site) during a negative low tide series. Due to the large number of research sites, scheduling constraints, the necessity for negative low tides and favorable weather/ocean conditions, exact survey dates are variable and difficult to predict. Table 1 in PISCO's application (see
The intertidal zones where PISCO conducts intertidal monitoring are also areas where pinnipeds can be found hauled out on the shore at or adjacent to some research sites. Accessing portions of the intertidal habitat may cause incidental Level B (behavioral) harassment of pinnipeds through some unavoidable approaches if pinnipeds are hauled out directly in the study plots or while biologists walk from one location to another. No motorized equipment is involved in conducting these surveys. The species for which Level B harassment is requested are: California sea lions (
Several pinniped species can be found along the California and Oregon coasts. The three that are most likely to occur at some of the research sites are California sea lion, harbor seal, and northern elephant seal. On rare occasions, PISCO researchers have seen very small numbers (i.e., five or fewer) of Steller sea lions at one of the sampling sites. These sightings are rare. Therefore, encounters are not expected. However, if Steller sea lions are sighted before approaching a sampling site, researchers will abandon approach and return at a later date. For this reason, this species is not considered further in this proposed IHA notice.
We refer the public to Carretta
Northern elephant seals are not listed as threatened or endangered under the Endangered Species Act (ESA), nor are they categorized as depleted under the MMPA. The estimated population of the California breeding stock is approximately 124,000 animals with a minimum estimate of 74,913 (Carretta
Northern elephant seals range in the eastern and central North Pacific Ocean, from as far north as Alaska and as far south as Mexico. Northern elephant seals spend much of the year, generally about nine months, in the ocean. They are usually underwater, diving to depths of about 330-800 m (1,000-2,500 ft) for 20- to 30-minute intervals with only short breaks at the surface. They are rarely seen out at sea for this reason. While on land, they prefer sandy beaches.
Northern elephant seals breed and give birth in California (U.S.) and Baja California (Mexico), primarily on offshore islands (Stewart
During PISCO research activities, the maximum number of northern elephant seals observed at a single site was at least 10 adults plus an unknown number of pups. These were observed offshore of Piedras Blancas. A small group of five adult elephant seals and five pups has been observed in the vicinity of our site at Piedras Blancas, and one elephant seal has been observed at Pigeon Point.
California sea lions are not listed as threatened or endangered under the ESA, nor are they categorized as depleted under the MMPA. The California sea lion is now a full species, separated from the Galapagos sea lion (
California sea lion breeding areas are on islands located in southern California, in western Baja California, Mexico, and the Gulf of California. During the breeding season, most California sea lions inhabit southern California and Mexico. Rookery sites in southern California are limited to the San Miguel Islands and the southerly Channel Islands of San Nicolas, Santa Barbara, and San Clemente (Carretta
A 2005 haul-out count of California sea lions between the Oregon/California border and Point Conception as well as the Channel Islands found 141,842 individuals (Carretta
Pacific harbor seals are not listed as threatened or endangered under the ESA, nor are they categorized as depleted under the MMPA. The estimated population of the California stock of Pacific harbor seals is approximately 30,196 animals with a minimum estimated population size of 26,667 (Carretta
The animals inhabit near-shore coastal and estuarine areas from Baja California, Mexico, to the Pribilof Islands in Alaska. Pacific harbor seals are divided into two subspecies:
In California, over 500 harbor seal haulout sites are widely distributed along the mainland and offshore islands, and include rocky shores, beaches and intertidal sandbars (Lowry
At several sites, harbor seals are often observed and have the potential to be disturbed by researchers accessing or sampling the site. The largest number of harbor seals occurs at Hopkins where often 20-30 adults and 10-15 pups are hauled-out on a small beach adjacent to the sampling site.
California (southern) sea otters (
The appearance of researchers may have the potential to cause Level B harassment of any pinnipeds hauled out at sampling sites. Although marine mammals are never deliberately approached by abalone survey personnel, approach may be unavoidable if pinnipeds are hauled out in the immediate vicinity of the permanent study plots. Disturbance may result in reactions ranging from an animal simply becoming alert to the presence of researchers (e.g., turning the head, assuming a more upright posture) to flushing from the haul-out site into the water. NMFS does not consider the lesser reactions to constitute behavioral harassment, or Level B harassment takes, but rather assumes that pinnipeds that move greater than 1 m (3.3 ft) or change the speed or direction of their movement in response to the presence of researchers are behaviorally harassed, and thus subject to Level B taking. Animals that respond to the presence of researchers by becoming alert, but do not move or change the nature of locomotion as described, are not considered to have been subject to behavioral harassment.
Numerous studies have shown that human activity can flush harbor seals off haulout sites (Allen
Typically, even those reactions constituting Level B harassment would result at most in temporary, short-term disturbance. In any given study season, researchers will visit sites one to two times per year for a total of 4-6 hours per visit. Therefore, disturbance of pinnipeds resulting from the presence of researchers lasts only for short periods of time and is separated by significant amounts of time in which no disturbance occurs. Because such disturbance is sporadic, rather than chronic, and of low intensity, individual marine mammals are unlikely to incur any detrimental impacts to vital rates or ability to forage and, thus, loss of fitness. Correspondingly, even local populations, much less the overall stocks of animals, are extremely unlikely to accrue any significantly detrimental impacts.
There are three ways in which disturbance, as described previously, could result in more than Level B harassment of marine mammals. All three are most likely to be consequences of stampeding, a potentially dangerous occurrence in which large numbers of animals succumb to mass panic and rush away from a stimulus, an occurrence that is not expected at the proposed sampling sites. The three situations are (1) Falling when entering the water at high-relief locations; (2) extended separation of mothers and pups; and (3) crushing of elephant seal pups by large males during a stampede.
Because hauled-out animals may move towards the water when disturbed, there is the risk of injury if animals stampede towards shorelines with precipitous relief (e.g., cliffs). However, while cliffs do exist along the coast, shoreline habitats near the abalone study sites are of steeply
The risk of marine mammal injury, serious injury, or mortality associated with rocky intertidal monitoring increases somewhat if disturbances occur during breeding season. These situations present increased potential for mothers and dependent pups to become separated and, if separated pairs do not quickly reunite, the risk of mortality to pups (through starvation) may increase. Separately, adult male elephant seals may trample elephant seal pups if disturbed, which could potentially result in the injury, serious injury, or mortality of the pups. The risk of either of these situations is greater in the event of a stampede.
Very few pups are anticipated to be encountered during the proposed monitoring surveys. No California sea lion pups are anticipated to be encountered, as rookery sites are typically limited to the islands. A very small number of harbor seal and northern elephant seal pups have been observed at a couple of the proposed monitoring sites over the past years. Though elephant seal pups are occasionally present when researchers visit survey sites, risk of pup mortalities is very low because elephant seals are far less reactive to researcher presence than the other two species. Further, pups are typically found on sand beaches, while study sites are located in the rocky intertidal zone, meaning that there is typically a buffer between researchers and pups. Finally, the caution used by researchers in approaching sites generally precludes the possibility of behavior, such as stampeding, that could result in extended separation of mothers and dependent pups or trampling of pups. No research would occur where separation of mother and her nursing pup or crushing of pups can become a concern.
In summary, NMFS does not anticipate that the proposed activities would result in the injury, serious injury, or mortality of pinnipeds because pups are only found at a couple of the proposed sampling locations during certain times of the year and that many rookeries occur on the offshore islands and not the mainland areas where the proposed activities would occur. In addition, researchers will exercise appropriate caution approaching sites, especially when pups are present and will redirect activities when pups are present.
PISCO complied with the mitigation and monitoring that we required under the IHA issued in December 2012. In compliance with the IHA, PISCO submitted a reporting detailing the activities and marine mammal monitoring they conducted. The IHA required PISCO to conduct counts of pinnipeds present at study sites prior to approaching the sites and to record species counts and any observed reactions to the presence of the researchers.
From December 3, 2012, through August 31, 2013, PISCO researchers conducted rocky intertidal sampling at 73 sites during 79 days. During this time period, no injured, stranded, or dead pinnipeds were observed. Tables 9, 10, and 11 in PISCO's monitoring report (see
Based on the results from the previous monitoring report, we conclude that these results support our original findings that the mitigation measures set forth in the 2012-2012 IHA effected the least practicable impact on the species or stocks. During periods of low tide (e.g., when tides are 0.6 m (2 ft) or less and low enough for pinnipeds to haul-out), we would expect the pinnipeds to return to the haulout site within 60 minutes of the disturbance (Allen
The potential effects to marine mammals described in this section of the document do not take into consideration the proposed monitoring and mitigation measures described later in this document (see the “Proposed Mitigation” and “Proposed Monitoring and Reporting” sections) which, as noted, should effect the least practicable impact on affected marine mammal species and stocks.
The only habitat modification associated with the proposed activity is the placement of permanent bolts and other sampling equipment in the intertidal. Bolts are installed during the set-up of a site and, at existing sites, this has already occurred. In some instances, bolts will need to be replaced or installed for new plots. Bolts are 7.6 to 12.7 cm (2 to 5 in) long, stainless steel 1 cm (3/8 in) Hex or Carriage bolts. They are installed by drilling a hole with a battery powered DeWalt 24 volt rotary hammer drill with a 1 cm (3/8 in) bit. The bolts protrude 1.3-7.6 cm (0.5-3 in) above the rock surface and are held in place with marine epoxy. Although the drill does produce noticeable noise, researchers have never observed an instance where near-by or offshore marine mammals were disturbed by it. Any marine mammal at the site would likely be disturbed by the presence of researchers and retreat to a distance where the noise of the drill would not increase the disturbance. In most instances, wind and wave noise also drown out the noise of the drill. The installation of bolts and other sampling equipment is conducted under the appropriate permits (Monterey Bay National Marine Sanctuary, California State Parks). Once a particular study has ended, the respective sampling equipment is removed. No trash or field gear is left at a site. Thus, the proposed activity is not expected to have any habitat-related effects, including to marine mammal prey species, that could cause significant or long-term consequences for individual marine mammals or their populations.
In order to issue an incidental take authorization (ITA) under Section 101(a)(5)(D) of the MMPA, NMFS must, where applicable, set forth the permissible methods of taking pursuant to such activity, and other means of effecting the least practicable impact on such species or stock and its habitat, paying particular attention to rookeries, mating grounds, and areas of similar significance, and on the availability of such species or stock for taking for certain subsistence uses (where relevant).
PISCO proposes to implement several mitigation measures to reduce potential take by Level B (behavioral disturbance) harassment. Measures include: (1) Conducting slow movements and staying close to the ground to prevent or minimize stampeding; (2) avoiding loud noises (i.e., using hushed voices); (3)
The methodologies and actions noted in this section will be utilized and included as mitigation measures in any issued IHA to ensure that impacts to marine mammals are mitigated to the lowest level practicable. The primary method of mitigating the risk of disturbance to pinnipeds, which will be in use at all times, is the selection of judicious routes of approach to study sites, avoiding close contact with pinnipeds hauled out on shore, and the use of extreme caution upon approach. In no case will marine mammals be deliberately approached by survey personnel, and in all cases every possible measure will be taken to select a pathway of approach to study sites that minimizes the number of marine mammals potentially harassed. In general, researchers will stay inshore of pinnipeds whenever possible to allow maximum escape to the ocean. Each visit to a given study site will last for approximately 4-6 hours, after which the site is vacated and can be re-occupied by any marine mammals that may have been disturbed by the presence of researchers. By arriving before low tide, worker presence will tend to encourage pinnipeds to move to other areas for the day before they haul out and settle onto rocks at low tide.
PISCO will suspend sampling and monitoring operations immediately if an injured marine mammal is found in the vicinity of the project area and the monitoring activities could aggravate its condition.
NMFS has carefully evaluated PISCO's proposed mitigation measures and considered a range of other measures in the context of ensuring that NMFS prescribes the means of effecting the least practicable impact on the affected marine mammal species and stocks and their habitat. Our evaluation of potential measures included consideration of the following factors in relation to one another:
• The manner in which, and the degree to which, the successful implementation of the measure is expected to minimize adverse impacts to marine mammals;
• the proven or likely efficacy of the specific measure to minimize adverse impacts as planned; and
• the practicability of the measure for applicant implementation.
Based on our evaluation of the applicant's proposed measures, NMFS has preliminarily determined that the proposed mitigation measures provide the means of effecting the least practicable impact on marine mammal species or stocks and their habitat, paying particular attention to rookeries, mating grounds, and areas of similar significance.
In order to issue an ITA for an activity, Section 101(a)(5)(D) of the MMPA states that NMFS must, where applicable, set forth “requirements pertaining to the monitoring and reporting of such taking”. The MMPA implementing regulations at 50 CFR 216.104(a)(13) indicate that requests for ITAs must include the suggested means of accomplishing the necessary monitoring and reporting that will result in increased knowledge of the species and of the level of taking or impacts on populations of marine mammals that are expected to be present in the proposed action area.
PISCO can add to the knowledge of pinnipeds in California and Oregon by noting observations of: (1) Unusual behaviors, numbers, or distributions of pinnipeds, such that any potential follow-up research can be conducted by the appropriate personnel; (2) tag-bearing carcasses of pinnipeds, allowing transmittal of the information to appropriate agencies and personnel; and (3) rare or unusual species of marine mammals for agency follow-up.
Proposed monitoring requirements in relation to PISCO's rocky intertidal monitoring will include observations made by the applicant. Information recorded will include species counts (with numbers of pups/juveniles when possible), numbers of observed disturbances, and descriptions of the disturbance behaviors during the monitoring surveys, including location, date, and time of the event. In addition, observations regarding the number and species of any marine mammals observed, either in the water or hauled out, at or adjacent to the site, will be recorded as part of field observations during research activities. Observations of unusual behaviors, numbers, or distributions of pinnipeds will be reported to NMFS so that any potential follow-up observations can be conducted by the appropriate personnel. In addition, observations of tag-bearing pinniped carcasses as well as any rare or unusual species of marine mammals will be reported to NMFS. Information regarding physical and biological conditions pertaining to a site, as well as the date and time that research was conducted will also be noted.
If at any time injury, serious injury, or mortality of the species for which take is authorized should occur, or if take of any kind of any other marine mammal occurs, and such action may be a result of the proposed research, PISCO will suspend research activities and contact NMFS immediately to determine how best to proceed to ensure that another injury or death does not occur and to ensure that the applicant remains in compliance with the MMPA.
A draft final report must be submitted to NMFS Office of Protected Resources within 60 days after the conclusion of the 2013-2014 field season or 60 days prior to the start of the next field season if a new IHA will be requested. The report will include a summary of the information gathered pursuant to the monitoring requirements set forth in the IHA. A final report must be submitted to the Director of the NMFS Office of Protected Resources and to the NMFS Southwest Office Regional Administrator within 30 days after receiving comments from NMFS on the draft final report. If no comments are received from NMFS, the draft final report will be considered to be the final report.
Except with respect to certain activities not pertinent here, the MMPA defines “harassment” as: any act of pursuit, torment, or annoyance which (i) has the potential to injure a marine mammal or marine mammal stock in the wild [Level A harassment]; or (ii) has the potential to disturb a marine mammal or marine mammal stock in the wild by causing disruption of behavioral patterns, including, but not limited to, migration, breathing, nursing, breeding, feeding, or sheltering [Level B harassment].
All anticipated takes would be by Level B harassment, involving temporary changes in behavior. The proposed mitigation and monitoring measures are expected to minimize the possibility of injurious or lethal takes such that take by injury, serious injury, or mortality is considered remote.
As discussed earlier, NMFS considers an animal to have been harassed if it moved greater than 1 m (3.3 ft) in response to the researcher's presence or if the animal was already moving and changed direction and/or speed, or if the animal flushed into the water. Animals that became alert without such movements were not considered harassed.
For the purpose of this proposed IHA, only Oregon and California sites that are frequently sampled and have a marine mammal presence during sampling were included in take estimates. Sites where only Biodiversity Surveys are conducted were not included due to the infrequency of sampling and rarity of occurrences of pinnipeds during sampling. In addition, Steller sea lions are not included in take estimates as they will not be disturbed by researchers or research activities since activities will not occur or will be suspended if Steller sea lions are present. A small number of harbor seal and northern elephant seal pup takes are anticipated as pups may be present at several sites during spring and summer sampling
Takes estimates are based on marine mammal observations from each site. Marine mammal observations are done as part of PISCO site observations, which include notes on physical and biological conditions at the site. The maximum number of marine mammals, by species, seen at any given time throughout the sampling day is recorded at the conclusion of sampling. A marine mammal is counted if it is seen on access ways to the site, at the site, or immediately up-coast or down-coast of the site. Marine mammals in the water immediately offshore are also recorded. Any other relevant information, including the location of a marine mammal relevant to the site, any unusual behavior, and the presence of pups is also noted.
These observations formed the basis from which researchers with extensive knowledge and experience at each site estimated the actual number of marine mammals that may be subject to take. In most cases the number of takes is based on the maximum number of marine mammals that have been observed at a site throughout the history of the site (2-3 observation per year for 5-10 years or more). Section 6 in PISCO's application outlines the number of visits per year for each sampling site and the potential number of pinnipeds anticipated to be encountered at each site. Table 8 in PISCO's application outlines the number of potential takes per site (see
Based on this information, NMFS proposes to authorize the take, by Level B harassment only, of 60 California sea lions, 337 harbor seals, and 36 northern elephant seals. These numbers are considered to be maximum take estimates; therefore, actual take may be slightly less if animals decide to haul out at a different location for the day or animals are out foraging at the time of the survey activities.
NMFS typically includes our negligible impact and small numbers analyses and determinations under the same section heading of our
NMFS has defined “negligible impact” in 50 CFR 216.103 as “. . . an impact resulting from the specified activity that cannot be reasonably expected to, and is not reasonably likely to, adversely affect the species or stock through effects on annual rates of recruitment or survival.” In making a negligible impact determination, NMFS considers a variety of factors, including but not limited to: (1) The number of anticipated mortalities; (2) the number and nature of anticipated injuries; (3) the number, nature, intensity, and duration of Level B harassment; and (4) the context in which the take occurs.
No injuries or mortalities are anticipated to occur as a result of PISCO's rocky intertidal monitoring, and none are proposed to be authorized. The behavioral harassments that could occur would be of limited duration, as researchers only conduct sampling one to two times per year at each site for a total of 4-6 hours per sampling event. Therefore, disturbance will be limited to a short duration, allowing pinnipeds to reoccupy the sites within a short amount of time.
Some of the pinniped species may use some of the sites during certain times of year to conduct pupping and/or breeding. However, some of these species prefer to use the offshore islands for these activities. At the sites where pups may be present, PISCO has proposed to implement certain mitigation measures, such as no intentional flushing if dependent pups are present, which will avoid mother/pup separation and trampling of pups.
Of the three marine mammal species anticipated to occur in the proposed activity areas, none are listed under the ESA. Table 1 in this document presents the abundance of each species or stock, the proposed take estimates, and the percentage of the affected populations or stocks that may be taken by harassment. Based on these estimates, PISCO would take less than 2.1% of each species or stock. Because these are maximum estimates, actual take numbers are likely to be lower, as some animals may select other haulout sites the day the researchers are present.
Based on the analysis contained herein of the likely effects of the specified activity on marine mammals and their habitat, and taking into consideration the implementation of the proposed mitigation and monitoring measures, NMFS preliminarily finds that the rocky intertidal monitoring program will result in the incidental take of small numbers of marine mammals, by Level B harassment only, and that the total taking from the rocky intertidal monitoring program will have a negligible impact on the affected species or stocks.
There are no relevant subsistence uses of marine mammals implicated by this action. Therefore, NMFS has determined that the total taking of affected species or stocks would not have an unmitigable adverse impact on the availability of such species or stocks for taking for subsistence purposes.
None of the marine mammals for which incidental take is proposed are listed as threatened or endangered under the ESA. NMFS' Permits and Conservation Division worked with the NMFS Southwest Regional Office to ensure that Steller sea lions would be avoided and incidental take would not occur. Therefore, NMFS has determined that issuance of the proposed IHA to PISCO under section 101(a)(5)(D) of the MMPA will have no effect on species listed as threatened or endangered under the ESA.
In 2012, we prepared an EA analyzing the potential effects to the human environment from conducting rocky intertidal surveys along the California and Oregon coasts and issued a Finding of No Significant Impact (FONSI) on the issuance of an IHA for PISCO's rocky intertidal surveys in accordance with section 6.01 of the NOAA Administrative Order 216-6 (Environmental Review Procedures for Implementing the National Environmental Policy Act, May 20, 1999). PISCO's proposed activities and impacts for 2013-2014 are within the scope of our 2012 EA and FONSI. We have reviewed the 2012 EA and determined that there are no new direct, indirect, or cumulative impacts to the human and natural environment associated with the IHA requiring evaluation in a supplemental EA and we, therefore, intend to reaffirm the 2012 FONSI.
As a result of these preliminary determinations, NMFS proposes to authorize the take of marine mammals incidental to PISCO's rocky intertidal monitoring research activities, provided the previously mentioned mitigation, monitoring, and reporting requirements are incorporated.
United States Patent and Trademark Office, Commerce.
Request for comments.
The USPTO is proposing to eliminate the Patents Search Templates from the USPTO Web site. In 2006, the United States Patent and Trademark Office (USPTO) implemented Patents Search Templates, which are United States Patent Classification (USPC) indexed search templates that were created to better identify the field of search, search tools, and search methodologies which should be considered each time an invention related to a particular USPC is searched. There are over 1200 search templates covering more than 600 USPC classes and subclasses. Historically, usage of the search templates by the public has been extremely low. Additionally, various aspects of the search templates, such as references to commercial database vendor information, are in need of updating. Further, the USPTO launched a new classification system, the Cooperative Patent Classification (CPC) system, in January 2013 that is based on the International Patent Classification (IPC) system. The CPC, a joint patent classification system developed by the USPTO and the European Patent Office (EPO), incorporates the best classification practices of both the U.S. and European systems. Since CPC is a detailed, collaborative, and dynamic system that will enable patent examiners and the public to efficiently conduct thorough patent searches, the search templates will become obsolete. Before eliminating the search templates from the USPTO Web site, the Office is requesting comments from the public.
Comments should be sent by electronic mail message over the Internet addressed to:
The comments will be available for public inspection at the Office of the Commissioner for Patents, located at Madison Building East, Tenth Floor, 600 Dulany Street, Alexandria, Virginia. Comments also will be available for viewing via the Office's Internet Web site (
Pinchus M. Laufer, Senior Legal
The USPTO published a notice for a request for comments on the search templates on May 16, 2006.
The USPTO is proposing to remove the search templates from its Web site. The search templates are currently out-of-date since they include, for example, outdated commercial database vendor information that could be misleading for external stakeholders. Also, the search templates are indexed under USPC, which will no longer be used. Updating the search templates, which would require the editing of over 1200 pages, would not be an efficient use of USPTO resources since the templates are rarely used by the public. Additionally, CPC, the new internationally compatible classification system, was launched in January 2013. CPC is a detailed, dynamic classification system that is based on the IPC and enables patent examiners and the public to efficiently conduct thorough patent searches. As a result of the implementation of the CPC, the search templates will become obsolete. CPC has been jointly developed with the EPO and incorporates the best classification practices of both the U.S. and European systems. The USPTO and the EPO also believe that CPC will enhance efficiency and support work sharing initiatives with a view to reducing unnecessary duplication of work, thereby leading to enhanced patent quality and timelier examination of pending applications. Initial feedback from stakeholders confirms that the transition to CPC is a positive development. More information about CPC can be found at
Due to the factors discussed above, the Office is proposing the removal of the search templates from the USPTO Web site. Notice and opportunity for public comment are not required prior to removal of the search templates. The Office, however, is publishing this notice for comment as it seeks the benefit of the public's views on the Office's proposed removal of the search templates. If, after consideration of the comments, the Office goes forward with the elimination of the search templates, a notice to that effect will be published, and any references to the search templates in USPTO documentation (for example, in the Accelerated Examination FAQs) will be updated.
The next meeting of the U.S. Commission of Fine Arts is scheduled for 21 November 2013, at 9:00 a.m. in the Commission offices at the National Building Museum, Suite 312, Judiciary Square, 401 F Street NW., Washington DC, 20001-2728. Items of discussion may include buildings, parks, and memorials. Draft agendas and additional information regarding the Commission are available on our Web site:
Institute of Education Sciences (IES), Department of Education (ED).
Notice.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 3501
Interested persons are invited to submit comments on or before December 30, 2013.
Comments submitted in response to this notice should be submitted electronically through the Federal eRulemaking Portal at
For questions related to collection activities or burden, please call Katrina Ingalls at 703-620-3655 or electronically mail
The Department of Education (ED), in accordance with the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3506(c)(2)(A)), provides the general public and Federal agencies with an opportunity to comment on proposed, revised, and continuing collections of information. This helps the Department assess the impact of its information collection requirements and minimize the public's reporting burden. It also helps the public understand the Department's information collection requirements and provide the requested data in the desired format. ED is soliciting comments on the proposed information collection request (ICR) that is described below. The Department of Education is especially interested in public comment addressing the following issues: (1) Is this collection necessary to the proper functions of the Department; (2) will this information be processed and used in a timely manner; (3) is the estimate of burden accurate; (4) how might the Department enhance the quality, utility, and clarity of the information to be collected; and (5) how might the Department minimize the burden of this collection on the respondents, including through the use of information technology. Please note that written comments received in response to this notice will be considered public records.
Institute of Education Sciences (IES), National Center for Education Statistics; Department of Education (ED).
Notice.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 3501
Interested persons are invited to submit comments on or before November 29, 2013.
Comments submitted in response to this notice should be submitted electronically through the Federal eRulemaking Portal at
For questions related to collection activities or burden, please call Kathy Axt at 540-776-7742 or electronically mail
The Department of Education (ED), in accordance with the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3506(c)(2)(A)), provides the general public and Federal agencies with an opportunity to comment on proposed, revised, and continuing collections of information. This helps the Department assess the impact of its information collection requirements and minimize the public's reporting burden. It also helps the public understand the Department's information collection requirements and provide the requested data in the desired format. ED is soliciting comments on the proposed information collection request (ICR) that is described below. The Department of Education is especially interested in public comment addressing the following issues: (1) Is this collection necessary to the proper functions of the Department; (2) will this information be processed and used in a timely manner; (3) is the estimate of burden accurate; (4) how might the Department enhance the quality, utility, and clarity of the information to be collected; and (5) how might the Department minimize the burden of this collection on the respondents, including through the use of information technology. Please note that written comments received in response to this notice will be considered public records.
Office of Elementary and Secondary Education (OESE), ED.
Notice.
In accordance with the Paperwork Reduction Act of 1995, ED is
Interested persons are invited to submit comments on or before December 30, 2013.
Comments submitted in response to this notice should be submitted electronically through the Federal eRulemaking Portal at
For questions related to collection activities or burden, please call Tomakie Washington, 202-401-1097 or electronically mail
The Department of Education (ED), in accordance with the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3506(c)(2)(A)), provides the general public and Federal agencies with an opportunity to comment on proposed, revised, and continuing collections of information. This helps the Department assess the impact of its information collection requirements and minimize the public's reporting burden. It also helps the public understand the Department's information collection requirements and provide the requested data in the desired format. ED is soliciting comments on the proposed information collection request (ICR) that is described below. The Department of Education is especially interested in public comment addressing the following issues: (1) Is this collection necessary to the proper functions of the Department; (2) will this information be processed and used in a timely manner; (3) is the estimate of burden accurate; (4) how might the Department enhance the quality, utility, and clarity of the information to be collected; and (5) how might the Department minimize the burden of this collection on the respondents, including through the use of information technology. Please note that written comments received in response to this notice will be considered public records.
Office of Special Education and Rehabilitative Services (OSERS), ED.
Notice.
In accordance with the Paperwork Reduction Act of 1995, ED is proposing; an extension of an existing information collection.
Interested persons are invited to submit comments on or before December 30, 2013.
Comments submitted in response to this notice should be submitted electronically through the Federal eRulemaking Portal at
For questions related to collection activities or burden, please call Tomakie Washington, 202-401-1097 or electronically mail
The Department of Education (ED), in accordance with the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3506(c)(2)(A)), provides the general public and Federal agencies with an opportunity to comment on proposed, revised, and continuing collections of information. This helps the Department assess the impact of its information collection requirements and minimize the public's reporting burden. It also helps the public understand the Department's information collection requirements and provide the requested data in the desired format. ED is soliciting comments on the proposed information collection request (ICR) that is described below. The Department of Education is especially interested in public comment addressing the following issues: (1) Is this collection necessary to the proper functions of the Department; (2) will this information be processed and used in a timely manner; (3) is the estimate of burden accurate; (4) how might the Department enhance the quality, utility, and clarity of the information to be collected; and (5) how might the Department minimize the burden of this collection on the respondents, including through the use of information technology. Please note that written comments received in response to this notice will be considered public records.
In notice document 2013-24594 appearing on pages 62602-62603 in the issue of Tuesday, October 22, 2013, make the following correction:
On page 62603, in the first column, beginning on the second line, “[insert the 30th day after publication of this notice]” should read “November 21, 2013”.
Office of Postsecondary Education (OPE), Department of Education (ED).
Notice.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 3501
Interested persons are invited to submit comments on or before December 30, 2013.
Comments submitted in response to this notice should be submitted electronically through the Federal eRulemaking Portal at
For questions related to collection activities or burden, please call Kate Mullan, 202-401-0563 or electronically mail
The Department of Education (ED), in accordance with the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3506(c)(2)(A)), provides the general public and Federal agencies with an opportunity to comment on proposed, revised, and continuing collections of information. This helps the Department assess the impact of its information collection requirements and minimize the public's reporting burden. It also helps the public understand the Department's information collection requirements and provide the requested data in the desired format. ED is soliciting comments on the proposed information collection request (ICR) that is described below. The Department of Education is especially interested in public comment addressing the following issues: (1) Is this collection necessary to the proper functions of the Department; (2) will this information be processed and used in a timely manner; (3) is the estimate of burden accurate; (4) how might the Department enhance the quality, utility, and clarity of the information to be collected; and (5) how might the Department minimize the burden of this collection on the respondents, including through the use of information technology. Please note that written comments received in response to this notice will be considered public records.
U.S. Department of Education, Office of Postsecondary Education, National Advisory Committee on Institutional Quality and Integrity.
Announcement of the time and location of the December 12-13, 2013 National Advisory Committee on Institutional Quality and Integrity (NACIQI) meeting.
U.S. Department of Education, Office of Postsecondary
• The establishment and enforcement of the criteria for recognition of accrediting agencies or associations under Subpart 2, Part H, Title IV, of the HEA, as amended.
• The recognition of specific accrediting agencies or associations or a specific State approval agency.
• The preparation and publication of the list of nationally recognized accrediting agencies and associations.
• The eligibility and certification process for institutions of higher education under Title IV, of the HEA, together with recommendations for improvement in such process.
• The relationship between (1) accreditation of institutions of higher education and the certification and eligibility of such institutions, and (2) State licensing responsibilities with respect to such institutions.
• Any other advisory function relating to accreditation and institutional eligibility that the Secretary may prescribe.
This meeting notice is an update to the previous notice (78 FR 50401) published on August 19, 2013, and sets forth the time and location for the December 12-13, 2013, meeting of the National Advisory Committee on Institutional Quality and Integrity (NACIQI).
Carol Griffiths, Executive Director, NACIQI, U.S. Department of Education, 1990 K Street NW., Room 8073, Washington, DC 20006-8129, telephone: (202) 219-7035, fax: (202) 219-7005, or email:
You may also access documents of the Department published in the
Office of the Under Secretary, Department of Education.
Notice.
In August 2013, President Barack Obama outlined the Administration's plans and proposals for combating rising college costs and making college affordable for American families. As part of an effort to gather public input about these proposals, and in particular the development of a college ratings system, the Department has scheduled four open forums around the country. At each open forum, a senior Administration official will be present to introduce the themes and key questions about the college value and affordability agenda and to receive feedback about the development of a college ratings system. Forum participants are welcome to share their views on measuring value and affordability, and in particular on the metrics and weighting of the ratings system.
The open forums will be held:
• Wednesday, November 6, 2013, at The California State University-Dominguez Hills, Los Angeles, CA;
• Wednesday, November 13, 2013, at George Mason University, Arlington, VA;
• Friday, November 15, 2013, at the University of Northern Iowa, Cedar Falls, IA; and
• Thursday, November 21, 2013, at Louisiana State University, Baton Rouge, LA.
All forums are open to the public.
You may submit comments regarding the Administration's proposals by electronic mail or by U.S. Mail, commercial delivery, or hand delivery. Submit electronic mail to
For information, including information about the process for collecting public input, contact: Josh Henderson, Office of the Under Secretary, U.S. Department of Education, 400 Maryland Avenue SW., Washington, DC 20202. Telephone: (202) 453-7239 or by email:
If you use a telecommunications device for the deaf (TDD) or text telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-800-877-8339.
If you have difficulty understanding English you may request language assistance services for Department information that is available to the public. These language assistance services are available free of charge. If you need more information about interpretation or translation services, please call 1-800-USA-LEARN (1-800-872-5327) (TTY: 1-800-437-0833), or email us at:
A higher education is one of the most important investments individuals can make in their futures. At the same time, higher education has never been more expensive. College tuition keeps rising.
In August 2013, President Obama outlined his agenda for combating rising college costs and making college affordable for American families. His plan will measure college performance through a new ratings system so students and families have the information to select schools that provide the best value. After this ratings system is well established, Congress can tie Federal student aid to college performance so that students maximize their Federal aid at institutions providing the best value. The plan will also promote innovation and competition by taking down barriers that stand in their way and shining a light on the most cutting-edge college practices and new technologies for providing high value at low costs. And to help student borrowers struggling with their existing debt, the President is committed to ensuring that all borrowers who need it can have access to the Pay As You Earn plan that caps loan payments at 10 percent of income.
Additional information on the proposals is available in the “FACT SHEET on the President's Plan to Make College More Affordable: A Better Bargain for the Middle Class,” which is posted online at
Please check for updated information on the forum locations, logistics, and other outreach activities, at
In addition to the open forums, the Department will seek input in a variety of venues and formats. During the months of October, November, and December 2013, the Department will host town halls and roundtables, and it will participate in events organized by other organizations. We also encourage the public to submit comments. Please see the
Individuals with disabilities can obtain this document in an accessible format (e.g., braille, large print, audiotape, or compact disc) on request to the program contact person listed under
The official version of this document is the document published in the
Office of Science, Department of Energy.
Notice of Open Teleconference.
This notice announces an open meeting of the Advanced Scientific Computing Advisory Committee (ASCAC). This meeting replaces the cancelled ASCAC meeting that was to be held in Washington, DC on October 8-9, 2013, due to the government shutdown. The Federal Advisory Committee Act (Pub. L. 92-463, 86 Stat. 770) requires that public notice of these meetings be announced in the
Monday, November 18, 2013; 1:00 p.m. to 5:00 p.m. (Mountain Time)
The meeting is open to the public. To access the call:
1. Dial Toll-Free Number: 866-740-1260 (U.S. & Canada)
2. International participants dial:
3. Enter access code 8083012, followed by “#”
To ensure we have sufficient access lines for the public, we request that members of the public notify the DFO, Christine Chalk, that you intend to call-into the meeting via email at:
Melea Baker, Office of Advanced Scientific Computing Research; SC-21/Germantown Building; U. S. Department of Energy; 1000 Independence Avenue SW., Washington, DC 20585-1290; Telephone (301) 903-7486, (Email:
Tentative Agenda Topics:
If you would like to file a written statement with the Committee, you may do so either before or after the meeting. If you would like to make oral statements regarding any of the items on the agenda, you should contact Melea Baker via FAX at 301-903-4846 or via email (
Department of Energy.
Notice of Open Meeting.
This notice announces a meeting of the Environmental Management Site-Specific Advisory Board (EM SSAB), Nevada. The Federal Advisory Committee Act (Pub. L. 92-463, 86 Stat. 770) requires that public notice of this meeting be announced in the
Wednesday, November 20, 2013, 5:00 p.m.
National Atomic Testing Museum, 755 E. Flamingo Road, Las Vegas, Nevada 89119.
Barbara Ulmer, Board Administrator, 232 Energy Way, M/S 505, North Las Vegas, Nevada 89030. Phone: (702) 630-0522; Fax (702) 295-5300 or Email:
Energy Efficiency and Renewable Energy, Department of Energy.
Notice of open meeting.
This notice announces an open meeting of the Biomass Research and Development Technical Advisory Committee under Section 9008(d) of the Food, Conservation, and Energy Act of 2008. The Federal Advisory Committee Act (Public Law No. 92-463, 86 Stat. 770) requires that agencies publish these notices in the
American Geophysical Union, 2000 Florida Avenue NW., Washington, DC 20009.
Elliott Levine, Designated Federal Official for the Committee, Office of Energy Efficiency and Renewable Energy, U.S. Department of Energy, 1000 Independence Avenue SW., Washington, DC 20585; (202) 586-1476; Email:
Take notice that on October 10, 2013, Texas Eastern Transmission, (Texas Eastern), having its principal place of business at 5400 Westheimer Court, Houston, Texas, 77056, filed an application in Docket No. CP14-4-000 pursuant to Section 7(b) and Section 7(c) of the Natural Gas Act (NGA), and Part 157 of the Commission's regulations, for a certificate of public convenience and necessity to construct its Emerald Longwall Mine Panel D1 Project. Texas Eastern states in its application that, due to anticipated longwall mining activities of Emerald Coal Resources, LP (Emerald) in Greene County, Pennsylvania in Panel D1 of Emerald's mine, ground subsidence may occur. In order to maintain the operation of their existing pipeline facilities throughout the duration of the subsidence anticipated from the mining activities, Texas Eastern proposes to excavate, elevate, replace, and/or abandon by removal certain sections of five different pipelines and appurtenant facilities located in Greene County, Pennsylvania, all as more fully set forth in the application, which is on file with the Commission and open to public inspection. This filing may also be viewed on the web at
Any questions regarding this application should be directed to Lisa A. Connolly, General Manager, Rates and Certificates, Texas Eastern Transmission, LP, P.O. Box 1642, Houston, Texas, 77251, or by calling (713) 627-4102 (telephone) or (713) 627-5947 (fax)
Pursuant to section 157.9 of the Commission's regulations, 18 CFR 157.9, within 90 days of this Notice, the Commission's staff will either complete its environmental assessment (EA) and place it into the Commission's public record (eLibrary) for this proceeding; or issue a Notice of Schedule for Environmental Review. If a Notice of Schedule for Environmental Review is issued, it will indicate, among other milestones, the anticipated date for the Commission's staff issuance of the EA for this proposal. The filing of the EA in the Commission's public record for this proceeding or the issuance of a Notice of Schedule for Environmental Review will serve to notify federal and state agencies of the timing for the completion of all necessary reviews, and the subsequent need to reach a final decision on a request for federal authorization within 90 days of the date of issuance of the Commission staff's EA.
There are two ways to become involved in the Commission's review of this project. First, any person wishing to obtain legal status by becoming a party to the proceedings for this project should, on or before the comment date stated below, file with the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426, a motion to intervene in accordance with the requirements of the Commission's Rules of Practice and Procedure (18 CFR 385.214 or 385.211) and the Regulations under the NGA (18 CFR 157.10). A person obtaining party status will be placed on the service list maintained by the Secretary of the Commission and will receive copies of all documents filed by the applicant and by all other parties. A party must submit 7 copies of filings made with the Commission and must mail a copy to the applicant and to every other party in the proceeding. Only parties to the proceeding can ask for court review of Commission orders in the proceeding.
However, a person does not have to intervene in order to have comments considered. The second way to participate is by filing with the Secretary of the Commission, as soon as possible, an original and two copies of comments in support of or in opposition to this project. The Commission will consider these comments in determining the appropriate action to be taken, but the filing of a comment alone will not serve to make the filer a party to the proceeding. The Commission's rules require that persons filing comments in opposition to the project provide copies of their protests only to the party or parties directly involved in the protest.
Persons who wish to comment only on the environmental review of this project should submit an original and two copies of their comments to the Secretary of the Commission. Environmental commenters will be placed on the Commission's environmental mailing list, will receive copies of the environmental documents, and will be notified of meetings associated with the Commission's environmental review process. Environmental commenters will not be required to serve copies of filed documents on all other parties. However, the non-party commenters will not receive copies of all documents filed by other parties or issued by the Commission (except for the mailing of environmental documents issued by the Commission) and will not have the right to seek court review of the Commission's final order.
The Commission strongly encourages electronic filings of comments, protests and interventions in lieu of paper using the “eFiling” link at
Take notice that the following hydroelectric application has been filed with the Commission and is available for public inspection.
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k. Pursuant to section 4.32(b)(7) of 18 CFR of the Commission's regulations, if any resource agency, Indian Tribe, or person believes that an additional scientific study should be conducted in order to form an adequate factual basis for a complete analysis of the application on its merit, the resource agency, Indian Tribe, or person must file a request for a study with the Commission not later than 60 days from the date of filing of the application, and serve a copy of the request on the applicant.
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The Commission strongly encourages electronic filing. Please file additional study requests and requests for cooperating agency status using the Commission's eFiling system at
m. The application is not ready for environmental analysis at this time.
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The existing project also includes a downstream fish passage facility that consists of: (1) A 3-foot-wide, 23-foot-long concrete intake with a 4-foot-wide, 8-foot-high entrance gate; (2) a collection channel with a 2-foot-high, 2-foot-wide overflow stoplog notch; and (3) a 5-foot-deep plunge pool.
The existing project bypasses approximately 700 feet of the Nashua River.
Pepperell Hydro Company, LLC proposes to increase the capacities of two turbine-generating units to 764 kW and 735 kW and install a new 67.5-kW low flow turbine-generating unit at the dam for a total installed capacity of 2,206.5 kW. Pepperell Hydro Company, LLC proposes to operate the project in a run-of-river mode and release: (1) 46 cubic feet per second (cfs) or inflow to the bypassed reach from April 1 through November 30, which would include 17 cfs or inflow through the existing downstream fish passage facility from June 15 through October 30; and (2) 15 cfs or inflow to the bypassed reach from December 1 through March 31. The project would have an estimated average annual generation of 7,997 megawatt-hours.
o. A copy of the application is available for review at the Commission in the Public Reference Room or may be viewed on the Commission's Web site at
You may also register online at
p. With this notice, we are initiating consultation with the Massachusetts Historical Commission, as required by section 106 of the National Historic Preservation Act and the regulations of the Advisory Council on Historic Preservation, 36 CFR 800.4.
q. Procedural schedule: The application will be processed according to the following preliminary Hydro Licensing Schedule. Revisions to the schedule will be made as appropriate.
This is a supplemental notice in the above-referenced proceeding, of BTG Pactual Commodities (US) LLC's application for market-based rate authority, with an accompanying rate schedule, noting that such application includes a request for blanket authorization, under 18 CFR part 34, of future issuances of securities and assumptions of liability.
Any person desiring to intervene or to protest should file with the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426, in accordance with Rules 211 and 214 of the Commission's Rules of Practice and
Notice is hereby given that the deadline for filing protests with regard
The Commission encourages electronic submission of protests and interventions in lieu of paper, using the FERC Online links at
Persons unable to file electronically should submit an original and 5 copies of the intervention or protest to the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426.
The filings in the above-referenced proceeding(s) are accessible in the Commission's eLibrary system by clicking on the appropriate link in the above list. They are also available for review in the Commission's Public Reference Room in Washington, DC. There is an eSubscription link on the Web site that enables subscribers to receive email notification when a document is added to a subscribed docket(s). For assistance with any FERC Online service, please email
Take notice that on October 22, 2013, pursuant to Rule 207(a)(2) of the Commission's Rules of Practices and Procedure, 18 CFR 385.207(a)(2)(2013), Enbridge Pipelines (FSP) LLC (Enbridge FSP) filed a petition requesting a declaratory order approving specific aspects of Enbridge FSP's proposed tariff and rate structure for the Flanagan South Pipeline Project, as further described in the petition.
Any person desiring to intervene or to protest in this proceedings must file in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests will be considered by the Commission in determining the appropriate action to be taken, but will not serve to make protestants parties to the proceeding. Anyone filing a motion to intervene or protest must serve a copy of that document on the Petitioner.
The Commission encourages electronic submission of protests and interventions in lieu of paper, using the FERC Online links at
Persons unable to file electronically should submit an original and 5 copies of the intervention or protest to the Federal Energy Regulatory Commission, 888 First St. NE., Washington, DC 20426.
The filings in the above proceedings are accessible in the Commission's eLibrary system by clicking on the appropriate link in the above list. They are also available for review in the Commission's Public Reference Room in Washington, DC. There is an eSubscription link on the Web site that enables subscribers to receive email notification when a document is added to a subscribed docket(s). For assistance with any FERC Online service, please email
On October 10, 2013, the Borough of Ellwood City, Pennsylvania, filed a notice of intent to construct a qualifying conduit hydropower facility, pursuant to section 30 of the Federal Power Act, as amended by section 4 of the Hydropower Regulatory Efficiency Act of 2013 (HREA). The Ellwood City Hydroelectric Project would be located at the Borough of Ellwood City's wastewater treatment plant in Lawrence County, Pennsylvania.
A qualifying conduit hydropower facility is one that is determined or deemed to meet all of the criteria shown in the table below.
Deadline for filing motions to intervene is 30 days from the issuance date of this notice.
Anyone may submit comments or a motion to intervene in accordance with the requirements of Rules of Practice and Procedure, 18 CFR 385.210 and 385.214. Any motions to intervene must be received on or before the specified deadline date for the particular proceeding.
The Commission strongly encourages electronic filing. Please file motions to intervene and comments using the Commission's eFiling system at
Environmental Protection Agency (EPA).
Notice.
On August 23, 2013, EPA announced that it would be holding three peer review meetings by web connect and teleconference on September 26, 2013, October 15, 2013, and November 12, 2013 regarding EPA's draft Toxic Substances Control Act (TSCA) chemical risk assessment, “TSCA Workplan Chemical Risk Assessment for Dichloromethane and N-Methylpyrrolidone.” The first meeting was held as scheduled. Due to the government shutdown, however, EPA has rescheduled the remaining two peer review meetings and is announcing the rescheduled meetings in this notice. EPA is also extending the due date for public comments.
Submit your comments, identified by docket identification (ID) number EPA-HQ-OPPT-2012-0725, by one of the methods described in the notice published in the
For details about the meetings regarding the peer review of EPA's draft Toxic Substances Control Act (TSCA) chemical risk assessment, “TSCA Workplan Chemical Risk Assessment for Dichloromethane and N-Methylpyrrolidone,” please see the notice that published in the
The rescheduled second peer review panel meeting on November 8, 2013, will be devoted to deliberations of the draft Dichloromethane (DCM) and N-Methylpyrrolidone (NMP) TSCA risk assessment by the peer review panel, guided by the charge questions to the peer review panel.
The third and final peer review panel meeting on December 13, 2013, will focus on the peer review panel's discussion of its draft DCM and NMP TSCA risk assessment recommendations to EPA, which will be posted on the contractor Web site prior to the final peer review meeting.
Environmental protection, Chemicals, Peer review, Risk assessments, Dichloromethane and N-Methylpyrrolidone.
Environmental Protection Agency (EPA).
Notice.
EPA has received several applications to register pesticide products containing active ingredients not included in any currently registered pesticide products. Pursuant to the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), EPA is hereby providing notice of receipt and opportunity to comment on these applications.
Comments must be received on or before November 29, 2013.
Submit your comments, identified by docket identification (ID) number and the EPA File Symbol of interest as shown in the body of this document, by one of the following methods:
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Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at
Susan Lewis, Antimicrobials Division (AD) (7510P), telephone number: (703) 305-7090, email address:
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).
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i. Identify the document by docket ID number and other identifying information (subject heading,
ii. Follow directions. The Agency may ask you to respond to specific questions or organize comments by referencing a Code of Federal Regulations (CFR) part or section number.
iii. Explain why you agree or disagree; suggest alternatives and substitute language for your requested changes.
iv. Describe any assumptions and provide any technical information and/or data that you used.
v. If you estimate potential costs or burdens, explain how you arrived at your estimate in sufficient detail to allow for it to be reproduced.
vi. Provide specific examples to illustrate your concerns and suggest alternatives.
vii. Explain your views as clearly as possible, avoiding the use of profanity or personal threats.
viii. Make sure to submit your comments by the comment period deadline identified.
EPA has received several applications to register pesticide products containing active ingredients not included in any currently registered pesticide products. Pursuant to the provisions of FIFRA section 3(c)(4), EPA is hereby providing notice of receipt and opportunity to comment on these applications. Notice of receipt of these applications does not
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Environmental protection, Pesticides and pests.
Environmental Protection Agency (EPA).
Notice.
This notice announces EPA's order for the cancellations, voluntarily requested by the registrants and accepted by the Agency, of the products listed in Table 1a and 1b of Unit II., pursuant to the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA). This cancellation order follows a August 21, 2013
The cancellations are effective October 30, 2013.
John W. Pates, Jr., Pesticide Re-Evaluation Division (7508P), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001; telephone number: (703) 308-8195; email address:
This action is directed to the public in general, and may be of interest to a wide range of stakeholders including environmental, human health, and agricultural advocates; the chemical industry; pesticide users; and members of the public interested in the sale, distribution, or use of pesticides. Since others also may be interested, the Agency has not attempted to describe all the specific entities that may be affected by this action.
The docket for this action, identified by docket identification (ID) number EPA-HQ-OPP-2009-1017, is available at
This notice announces the cancellation, as requested by registrants, of products registered under FIFRA section 3. In addition, this notice also announces the cancellation, as requested by Syngenta Crop Protection, LLC (Syngenta), of the last two remaining tralkoxydim products registered for use in the United States. EPA is not proposing any tolerance actions for tralkoxydim at this time. However, if any tolerance actions become necessary in the future, there will be an announcement published in the
Table 2 of this unit includes the names and addresses of record for all registrants of the products in Table 1a and 1b of this unit, in sequence by EPA company number. This number corresponds to the first part of the EPA registration numbers of the products listed in Table 1a and 1b of this unit.
During the public comment period provided, EPA received no comments in response to the August 21, 2013
Pursuant to FIFRA section 6(f), EPA hereby approves the requested cancellations of the registrations identified in Table 1a and 1b of Unit II. Accordingly, the Agency hereby orders that the product registrations identified in Table 1a and 1b of Unit II. are canceled. The effective date of the cancellations that are the subject of this notice is October 30, 2013. Any distribution, sale, or use of existing stocks of the products identified in Table 1a and 1b of Unit II. in a manner inconsistent with any of the provisions for disposition of existing stocks set forth in Unit VI. will be a violation of FIFRA.
Section 6(f)(1) of FIFRA provides that a registrant of a pesticide product may at any time request that any of its pesticide registrations be canceled or amended to terminate one or more uses. FIFRA further provides that, before acting on the request, EPA must publish a notice of receipt of any such request in the
Existing stocks are those stocks of registered pesticide products which are currently in the United States and which were packaged, labeled, and released for shipment prior to the effective date of the cancellation action. The existing stocks provisions for the products subject to this order are as follows.
The registrants may continue to sell and distribute existing stocks of products listed in Table 1a of Unit II. until October 30, 2014, which is 1 year after the publication of the Cancellation Order in the
The registrants may continue to sell and distribute existing stocks of products listed in Table 1b of Unit II. until November 1, 2014. Thereafter, the registrants are prohibited from selling or distributing products listed in Table 1b, except for export in accordance with FIFRA section 17, or proper disposal. Persons other than the registrants may sell, distribute, or use existing stocks of products listed in Table 1b of Unit II. until existing stocks are exhausted, provided that such sale, distribution, or use is consistent with the terms of the previously approved labeling on, or that accompanied, the canceled products.
Environmental protection, Pesticides and pests.
The Commission hereby gives notice of the filing of the following agreements under the Shipping Act of 1984. Interested parties may submit comments on the agreements to the Secretary, Federal Maritime Commission, Washington, DC 20573, within ten days of the date this notice appears in the
By Order of the Federal Maritime Commission.
The Commission gives notice that the following Ocean Transportation Intermediary license has been reissued pursuant to section 19 of the Shipping Act of 1984 (46 U.S.C. 40101).
The Commission gives notice that the following Ocean Transportation Intermediary licenses have been revoked or terminated for the reason shown pursuant to section 19 of the Shipping Act of 1984 (46 U.S.C. 40101) effective on the date shown.
The companies listed in this notice have applied to the Board for approval, pursuant to the Bank Holding Company Act of 1956 (12 U.S.C. 1841
The applications listed below, as well as other related filings required by the Board, are available for immediate inspection at the Federal Reserve Bank indicated. The applications will also be available for inspection at the offices of the Board of Governors. Interested persons may express their views in writing on the standards enumerated in the BHC Act (12 U.S.C. 1842(c)). If the proposal also involves the acquisition of a nonbanking company, the review also includes whether the acquisition of the nonbanking company complies with the standards in section 4 of the BHC Act (12 U.S.C. 1843). Unless otherwise noted, nonbanking activities will be conducted throughout the United States.
Unless otherwise noted, comments regarding each of these applications must be received at the Reserve Bank indicated or the offices of the Board of Governors not later than November 25, 2013.
A. Federal Reserve Bank of Dallas (E. Ann Worthy, Vice President) 2200 North Pearl Street, Dallas, Texas 75201-2272:
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Office of Government-Wide Policy, General Services Administration (GSA).
Notice.
This notice announces the cancellation of the GTAC November 7, 2013 meeting originally published on September 12, 2013 in the
The meeting will be held on Tuesday, December 10, 2013, beginning at 9:00 a.m. and ending no later than 4:00 p.m. Eastern Standard Time.
Ms. Marcerto Barr, Designated Federal Officer (DFO), Government-wide Travel
This notice announces the cancellation of the GTAC November 7, 2013 meeting originally published in the
Office of Government-Wide Policy, U.S. General Services Administration (GSA).
Meeting notice.
The Presidential Commission on Election Administration (PCEA), a Federal Advisory Committee established in accordance with the Federal Advisory Committee Act (FACA), 5 U.S.C., App., and Executive Order 13639, as amended by EO 13644, will hold a meeting open to the public via teleconference on Thursday, November 14, 2013.
Mr. Mark Nejbauer, Designated Federal Officer, General Services Administration, Presidential Commission on Election Administration, 1776 G Street NW., Washington, DC 20006, email
The Centers for Disease Control and Prevention (CDC) publishes a list of information collection requests under review by the Office of Management and Budget (OMB) in compliance with the Paperwork Reduction Act (44 U.S.C. Chapter 35). To request a copy of these requests, call (404) 639-7570 or send an email to
Assessment of a Comprehensive Human Immunodeficiency Virus (HIV) Clinic-Based Intervention to Promote Patients' Health and Reduce Transmission Risk—New—National Center for HIV/AIDS, Viral Hepatitis, STD, and TB Prevention (NCHHSTP), Centers for Disease Control and Prevention (CDC).
This research is funded by the CDC and the National Institute of Mental Health (NIMH). The purpose of the project is to implement and evaluate an HIV clinic-based intervention, the goals of which are to increase the percentage of patients who have an undetectable viral load, who are adherent to antiretroviral therapy (ART), who attend clinic regularly for primary care, and practice safer sexual behaviors. Realizing these goals will promote HIV patients' health and reduce risk of transmitting HIV to others. These are objectives of the National HIV/AIDS Strategy and goals of the strategic plan of the Division of HIV/AIDS Prevention, Centers for Disease Control and Prevention.
The project will be conducted at six university-affiliated HIV clinics in the United States: (1) Baylor College of Medicine, Houston, (2) Boston Medical
The intervention that is part of this project focuses primarily on HIV patients who have a detectable viral load, i.e., their viral load is not as low as it can be and is not fully controlled. The intervention components include: (1) Brief counseling from medical providers during primary care visits informed by a behavioral screener completed by patients; (2) a computer-based intervention (CBI) in which patients see short videos of HIV medical providers (not their own providers) talking about the importance of regular clinic attendance, adherence to ART, and safer sex; and (3) one-on-one counseling from a prevention specialist if needed.
The following data will be collected in this project:
• A data manager at each clinic will electronically transmit patient clinical data to CDC using a unique study identification code as the only means of identifying a patient's data. The data files sent to CDC will not contain any medical record numbers, names, or social security numbers. The information will be encrypted and stored in a secure CDC server. The data collected from patients include (1) a behavioral screener self-administered by patients each time they have a primary care visit. Patients complete the screener in the waiting room before seeing their primary care provider. (2) CBI assessment items on demographic factors, clinic attendance, ART status, ART adherence, and sexual risk behavior that are completed before patients see the CBI videos. Patients with detectable viral loads will be asked to do the CBI three times, spaced approximately three months apart. Patients' CBI responses are not shared with their clinic providers. (3) On a quarterly basis, 50 patients at each clinic will be asked to complete a brief exit survey after their medical exam, asking about topics that the provider may have discussed with them at their medical visit (e.g., adherence, clinic attendance).
• Data collected from primary care medical providers includes a quarterly survey asking them to indicate the types of topics/issues they discussed with their HIV patients.
There are no costs to respondents other than their time. The total annualized burden hours are 3,378.
Centers for Medicare & Medicaid Services (CMS), HHS.
Notice.
This notice announces the monthly actuarial rates for aged (age 65 and over) and disabled (under age 65) beneficiaries enrolled in Part B of the Medicare Supplementary Medical Insurance (SMI) program beginning January 1, 2014. In addition, this notice announces the monthly premium for aged and disabled beneficiaries as well as the income-related monthly adjustment amounts to be paid by beneficiaries with modified adjusted gross income above certain threshold amounts. The monthly actuarial rates for 2014 are $209.80 for aged enrollees and $218.90 for disabled enrollees. The standard monthly Part B premium rate for all enrollees for 2014 is $104.90, which is equal to 50 percent of the monthly actuarial rate for aged enrollees or approximately 25 percent of the expected average total cost of Part B coverage for aged enrollees. (The 2013 standard premium rate was $104.90.) The Part B deductible for 2014 is $147.00 for all Part B beneficiaries. If a beneficiary has to pay an income-related monthly adjustment, they may have to pay a total monthly premium of about 35, 50, 65, or 80 percent of the total cost of Part B coverage.
M. Kent Clemens, (410) 786-6391.
Part B is the voluntary portion of the Medicare program that pays all or part of the costs for physicians' services, outpatient hospital services, certain home health services, services furnished by rural health clinics, ambulatory surgical centers, comprehensive outpatient rehabilitation facilities, and certain other medical and health services not covered by Medicare Part A, Hospital Insurance. Medicare Part B is available to individuals who are entitled to Medicare Part A, as well as to U.S. residents who have attained age 65 and are citizens, and aliens who were lawfully admitted for permanent residence and have resided in the United States for 5 consecutive years. Part B requires enrollment and payment of monthly premiums, as described in 42 CFR part 407, subpart B, and part 408, respectively. The difference between the premiums paid by all
The Secretary of the Department of Health and Human Services (the Secretary) is required by section 1839 of the Social Security Act (the Act) to announce the Part B monthly actuarial rates for aged and disabled beneficiaries as well as the monthly Part B premium. The Part B annual deductible is included because its determination is directly linked to the aged actuarial rate.
The monthly actuarial rates for aged and disabled enrollees are used to determine the correct amount of general revenue financing per beneficiary each month. These amounts, according to actuarial estimates, will equal, respectively, one-half of the expected average monthly cost of Part B for each aged enrollee (age 65 or over) and one-half of the expected average monthly cost of Part B for each disabled enrollee (under age 65).
The Part B deductible to be paid by enrollees is also announced. Prior to the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) (Pub. L. 108-173), the Part B deductible was set in statute. After setting the 2005 deductible amount at $110, section 629 of the MMA (amending section 1833(b) of the Act) requires that the Part B deductible be indexed beginning in 2006. The inflation factor to be used each year is the annual percentage increase in the Part B actuarial rate for enrollees age 65 and over. Specifically, the 2014 Part B deductible is calculated by multiplying the 2013 deductible by the ratio of the 2014 aged actuarial rate to the 2013 aged actuarial rate. The amount determined under this formula is then rounded to the nearest $1.
The monthly Part B premium rate to be paid by aged and disabled enrollees is also announced. (Although the costs to the program per disabled enrollee are different than for the aged, the statute provides that they pay the same premium amount.) Beginning with the passage of section 203 of the Social Security Amendments of 1972 (Pub. L. 92-603), the premium rate, which was determined on a fiscal year basis, was limited to the lesser of the actuarial rate for aged enrollees, or the current monthly premium rate increased by the same percentage as the most recent general increase in monthly Title II social security benefits.
However, the passage of section 124 of the Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA) (Pub. L. 97-248) suspended this premium determination process. Section 124 of TEFRA changed the premium basis to 50 percent of the monthly actuarial rate for aged enrollees (that is, 25 percent of program costs for aged enrollees). Section 606 of the Social Security Amendments of 1983 (Pub. L. 98-21), section 2302 of the Deficit Reduction Act of 1984 (DEFRA 84) (Pub. L. 98-369), section 9313 of the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA 85) (Pub. L. 99-272), section 4080 of the Omnibus Budget Reconciliation Act of 1987 (OBRA 87) (Pub. L. 100-203), and section 6301 of the Omnibus Budget Reconciliation Act of 1989 (OBRA 89) (Pub. L. 101-239) extended the provision that the premium be based on 50 percent of the monthly actuarial rate for aged enrollees (that is, 25 percent of program costs for aged enrollees). This extension expired at the end of 1990.
The premium rate for 1991 through 1995 was legislated by section 1839(e)(1)(B) of the Act, as added by section 4301 of the Omnibus Budget Reconciliation Act of 1990 (OBRA 90) (Pub. L. 101-508). In January 1996, the premium determination basis would have reverted to the method established by the 1972 Social Security Act Amendments. However, section 13571 of the Omnibus Budget Reconciliation Act of 1993 (OBRA 93) (Pub. L. 103-66) changed the premium basis to 50 percent of the monthly actuarial rate for aged enrollees (that is, 25 percent of program costs for aged enrollees) for 1996 through 1998.
Section 4571 of the Balanced Budget Act of 1997 (BBA) (Pub. L. 105-33) permanently extended the provision that the premium be based on 50 percent of the monthly actuarial rate for aged enrollees (that is, 25 percent of program costs for aged enrollees).
The BBA included a further provision affecting the calculation of the Part B actuarial rates and premiums for 1998 through 2003. Section 4611 of the BBA modified the home health benefit payable under Part A for individuals enrolled in Part B. Under this section, beginning in 1998, expenditures for home health services not considered “post-institutional” are payable under Part B rather than Part A. However, section 4611(e)(1) of the BBA required that there be a transition from 1998 through 2002 for the aggregate amount of the expenditures transferred from Part A to Part B. Section 4611(e)(2) of the BBA also provided a specific yearly proportion for the transferred funds. The proportions were
Section 4611(e)(3) of the BBA also specified, for the purpose of determining the premium, that the monthly actuarial rate for enrollees age 65 and over be computed as though the transition would occur for 1998 through 2003 and that
Section 811 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Pub. L. 108-173, also known as the Medicare Modernization Act, or MMA), which amended section 1839 of the Act, requires that, starting on January 1, 2007, the Part B premium a beneficiary pays each month be based on their annual income. Specifically, if a beneficiary's “modified adjusted gross income” is greater than the legislated threshold amounts (for 2014, $85,000 for a beneficiary filing an individual income tax return, and $170,000 for a beneficiary filing a joint tax return) the beneficiary is responsible for a larger portion of the estimated total cost of Part B benefit coverage. In addition to the standard 25 percent premium, these beneficiaries now have to pay an income-related monthly adjustment amount. The MMA made no change to the actuarial rate calculation, and the standard premium, which will continue to be paid by beneficiaries whose modified adjusted gross income is below the applicable thresholds, still represents 25 percent of the estimated total cost to the program of Part B coverage for an aged enrollee. However, depending on income and tax filing status, a beneficiary can now be responsible for 35, 50, 65, or 80 percent of the estimated total cost of Part B coverage, rather than 25 percent. The end result of the higher premium is that the Part B premium subsidy is reduced and less general revenue financing is required for beneficiaries with higher income because they are paying a larger share of the total cost with their premium. That is, the premium subsidy continues to be approximately 75 percent for beneficiaries with income below the applicable income thresholds, but will be reduced for beneficiaries with income above these thresholds. The MMA specified that there be a 5-
Section 4732(c) of the BBA added section 1933(c) of the Act, which required the Secretary to allocate money from the Part B trust fund to the State Medicaid programs for the purpose of providing Medicare Part B premium assistance from 1998 through 2002 for the low-income Medicaid beneficiaries who qualify under section 1933 of the Act. This allocation, while not a benefit expenditure, was an expenditure of the trust fund and was included in calculating the Part B actuarial rates through 2002. For 2003 through 2013, the expenditure was made from the trust fund because the allocation was temporarily extended. However, because the extension occurred after the financing was determined, the allocation was not included in the calculation of the financing rates.
A further provision affecting the calculation of the Part B premium is section 1839(f) of the Act, as amended by section 211 of the Medicare Catastrophic Coverage Act of 1988 (MCCA 88) (Pub. L. 100-360). (The Medicare Catastrophic Coverage Repeal Act of 1989 (Pub. L. 101-234) did not repeal the revisions to section 1839(f) made by MCCA 88.) Section 1839(f) of the Act, referred to as the “hold-harmless” provision, provides that if an individual is entitled to benefits under section 202 or 223 of the Act (the Old-Age and Survivors Insurance Benefit and the Disability Insurance Benefit, respectively) and has the Part B premiums deducted from these benefit payments, the premium increase will be reduced, if necessary, to avoid causing a decrease in the individual's net monthly payment. This decrease in payment occurs if the increase in the individual's social security benefit due to the cost-of-living adjustment under section 215(i) of the Act is less than the increase in the premium. Specifically, the reduction in the premium amount applies if the individual is entitled to benefits under section 202 or 223 of the Act for November and December of a particular year and the individual's Part B premiums for December and the following January are deducted from the respective month's section 202 or 223 benefits. The “hold-harmless” provision does not apply to beneficiaries who are required to pay an income-related monthly adjustment amount.
A check for benefits under section 202 or 223 of the Act is received in the month following the month for which the benefits are due. The Part B premium that is deducted from a particular check is the Part B payment for the month in which the check is received. Therefore, a benefit check for November is not received until December, but has December's Part B premium deducted from it.
Generally, if a beneficiary qualifies for hold-harmless protection, the reduced premium for the individual for that January and for each of the succeeding 11 months is the greater of either—
• The monthly premium for January reduced as necessary to make the December monthly benefits, after the deduction of the Part B premium for January, at least equal to the preceding November's monthly benefits, after the deduction of the Part B premium for December; or
• The monthly premium for that individual for that December.
In determining the premium limitations under section 1839(f) of the Act, the monthly benefits to which an individual is entitled under section 202 or 223 of the Act do not include retroactive adjustments or payments and deductions on account of work. Also, once the monthly premium amount is established under section 1839(f) of the Act, it will not be changed during the year even if there are retroactive adjustments or payments and deductions on account of work that apply to the individual's monthly benefits.
Individuals who have enrolled in Part B late or who have re-enrolled after the termination of a coverage period are subject to an increased premium under section 1839(b) of the Act. The increase is a percentage of the premium and is based on the new premium rate before any reductions under section 1839(f) of the Act are made.
The Medicare Part B monthly actuarial rates applicable for 2014 are $209.80 for enrollees age 65 and over and $218.90 for disabled enrollees under age 65. In section II.B. of this notice, we present the actuarial assumptions and bases from which these rates are derived. The Part B standard monthly premium rate for all enrollees for 2014 is $104.90. The Part B annual deductible for 2014 is $147.00. The following are the 2014 Part B monthly premium rates to be paid by beneficiaries who file an individual tax return (including those who are single, head of household, qualifying widow(er) with dependent child, or married filing separately who lived apart from their spouse for the entire taxable year), or a joint tax return.
In addition, the monthly premium rates to be paid by beneficiaries who are married and lived with their spouse at any time during the taxable year, but file a separate tax return from their spouse, are as follows:
The Part B annual deductible for 2014 is $147.00 for all beneficiaries.
Except where noted, the actuarial assumptions and bases used to determine the monthly actuarial rates and the monthly premium rates for Part B are established by the Office of the Actuary in the Centers for Medicare & Medicaid Services. The estimates underlying these determinations are prepared by actuaries meeting the qualification standards and following the actuarial standards of practice established by the Actuarial Standards Board.
Under the statute, the starting point for determining the standard monthly premium is the amount that would be necessary to finance Part B on an incurred basis. This is the amount of income that would be sufficient to pay for services furnished during that year (including associated administrative costs) even though payment for some of these services will not be made until after the close of the year. The portion of income required to cover benefits not paid until after the close of the year is added to the trust fund and used when needed.
The premium rates are established prospectively and are, therefore, subject to projection error. Additionally, legislation enacted after the financing was established, but effective for the period in which the financing is set, may affect program costs. As a result, the income to the program may not equal incurred costs. Therefore, trust fund assets must be maintained at a level that is adequate to cover an appropriate degree of variation between actual and projected costs, and the amount of incurred, but unpaid, expenses. Numerous factors determine what level of assets is appropriate to cover variation between actual and projected costs. The three most important of these factors are: (1) The difference from prior years between the actual performance of the program and estimates made at the time financing was established; (2) the likelihood and potential magnitude of expenditure changes resulting from enactment of legislation affecting Part B costs in a year subsequent to the establishment of financing for that year; and (3) the expected relationship between incurred and cash expenditures. These factors are analyzed on an ongoing basis, as the trends can vary over time.
Table 1 summarizes the estimated actuarial status of the trust fund as of the end of the financing period for 2012 and 2013.
The monthly actuarial rate for enrollees age 65 and older is one-half of the sum of monthly amounts for: (1) The projected cost of benefits, and (2) administrative expenses for each enrollee age 65 and older, after adjustments to this sum to allow for interest earnings on assets in the trust fund and an adequate contingency margin. The contingency margin is an amount appropriate to provide for possible variation between actual and projected costs and to amortize any surplus assets or unfunded liabilities.
The monthly actuarial rate for enrollees age 65 and older for 2014 is determined by first establishing per-enrollee cost by type of service from program data through 2012 and then projecting these costs for subsequent years. The projection factors used for financing periods from January 1, 2011 through December 31, 2014 are shown in Table 2.
As indicated in Table 3, the projected monthly rate required to pay for one-half of the total of benefits and administrative costs for enrollees age 65 and over for 2014 is $198.42. Based on current estimates, the assets are not sufficient to cover the amount of incurred, but unpaid, expenses and to provide for a significant degree of variation between actual and projected costs. Thus, a positive contingency margin is needed to increase assets to a more appropriate level. The monthly actuarial rate of $209.80 provides an adjustment of $13.53 for a contingency margin and −$2.15 for interest earnings.
The size of the contingency margin for 2014 is affected by several factors. The largest factor involves the current law formula for physician fees, which is scheduled to result in a reduction in physician fees of 23.7 percent in 2014. For each year from 2003 through 2013, Congress has acted to prevent physician fee reductions from occurring. In recognition of the strong possibility of substantial increase in Part B expenditures that would result from similar legislation to override the decreases in physician fees in 2014, it is appropriate to maintain a significantly larger Part B contingency reserve than would otherwise be
Two other, smaller factors affect the contingency margin for 2014. Starting in 2011, manufacturers and importers of brand-name prescription drugs have paid a fee that is allocated to the Part B account of the SMI trust. For 2014, the total of these brand-name drug fees is estimated to be $3 billion. The contingency margin has been reduced to account for this additional revenue.
Another small factor impacting the contingency margin comes from the requirement that certain payment incentives, to encourage the development and use of health information technology (HIT) by Medicare physicians, are to be excluded from the premium determination. HIT bonuses or penalties will be directly offset through transfers with the general fund of the Treasury. The monthly actuarial rate includes an adjustment of −$3.11 for HIT bonus payments in 2014.
The traditional goal for the Part B reserve has been that assets minus liabilities at the end of a year should represent between 15 and 20 percent of the following year's total incurred expenditures. To accomplish this goal, a 17 percent reserve ratio has been the normal target used to calculate the Part B premium. In view of the strong likelihood of actual expenditures exceeding estimated levels, due to the likelihood of the enactment of legislation after the financing has been set for 2014 as a result of the scheduled 2014 physician update, a contingency reserve ratio in excess of 20 percent of the following year's expenditures would better ensure that the assets of the Part B account can adequately cover the cost of incurred-but-not-reported benefits together with variations between actual and estimated cost levels.
The actuarial rate of $209.80 per month for aged beneficiaries, as announced in this notice for 2014, reflects the combined net effect of the factors previously described and the projection assumptions listed in Table 2.
Disabled enrollees are those persons under age 65 who are enrolled in Part B because of entitlement to Social Security disability benefits for more than 24 months or because of entitlement to Medicare under the end-stage renal disease (ESRD) program. Projected monthly costs for disabled enrollees (other than those with ESRD) are prepared in a fashion parallel to the projection for the aged using appropriate actuarial assumptions (see Table 2). Costs for the ESRD program are projected differently because of the different nature of services offered by the program.
As shown in Table 4, the projected monthly rate required to pay for one-half of the total of benefits and administrative costs for disabled enrollees for 2014 is $234.57. The monthly actuarial rate of $218.90 also provides an adjustment of −$3.72 for interest earnings and −$11.95 for a contingency margin, reflecting the same factors described previously for the aged actuarial rate. Based on current estimates, the assets associated with the disabled Medicare beneficiaries more than sufficient to cover the amount of incurred, but unpaid, expenses and to provide for a significant degree of variation between actual and projected costs. Thus, a negative contingency margin is needed to decrease assets to an appropriate level.
The actuarial rate of $218.90 per month for disabled beneficiaries, as announced in this notice for 2014, reflects the combined net effect of the factors described previously for aged beneficiaries and the projection assumptions listed in Table 2.
Several factors contribute to uncertainty about future trends in medical care costs. It is appropriate to test the adequacy of the rates using alternative cost growth rate assumptions. The results of those assumptions are shown in Table 5. One set represents increases that are lower and, therefore, more optimistic than the current estimate. The other set represents increases that are higher and, therefore, more pessimistic than the current estimate. The values for the alternative assumptions were determined from a statistical analysis of the historical variation in the respective increase factors.
As indicated in Table 5, the monthly actuarial rates would result in an excess of assets over liabilities of $71,024 million by the end of December 2014 under the cost growth rate assumptions used in preparing this report and assuming that the provisions of current law are fully implemented. This amounts to 27.5 percent of the estimated total incurred expenditures for the following year.
Assumptions that are somewhat more pessimistic (and that therefore test the adequacy of the assets to accommodate projection errors) produce a surplus of $36,697 million by the end of December 2014 under current law, which amounts to 12.8 percent of the estimated total incurred expenditures for the following year. Under fairly optimistic assumptions, the monthly actuarial rates would result in a surplus of $96,302 million by the end of December 2014, or 41.5 percent of the estimated total incurred expenditures for the following year.
The previous analysis indicates that the premium and general revenue financing established for 2014, together with existing Part B account assets would be adequate to cover estimated Part B costs for 2014 under current law, even if actual costs prove to be somewhat greater than expected.
As determined in accordance with section 1839 of the Act, listed are the 2013 Part B monthly premium rates to be paid by beneficiaries who file an individual tax return (including those who are single, head of household, qualifying widow(er) with dependent child, or married filing separately who lived apart from their spouse for the entire taxable year), or a joint tax return.
In addition, the monthly premium rates to be paid by beneficiaries who are married and lived with their spouse at any time during the taxable year, but file a separate tax return from their spouse, are listed as follows:
Section 1839 of the Act requires us to annually announce (that is by September 30th of each year) the Part B monthly actuarial rates for aged and disabled beneficiaries as well as the monthly Part B premium. We also announce the Part B annual deductible because its determination is directly linked to the aged actuarial rate.
We have examined the impacts of this rule as required by Executive Order 12866 on Regulatory Planning and Review (September 30, 1993), Executive Order 13563 on Improving Regulation and Regulatory Review (January 18, 2011), the Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354), section 1102(b) of the Social Security Act, section 202 of the Unfunded Mandates Reform Act of 1995 (March 22, 1995, Pub. L. 104-4), Executive Order 13132 on Federalism (August 4, 1999) and the Congressional Review Act (5 U.S.C. 804(2)).
Executive Orders 12866 and 13563 direct agencies to assess all 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). A regulatory impact analysis (RIA) must be prepared for major notices with economically significant effects ($100 million or more in any 1 year). For 2014, the standard Part B premium rate, the Part B income-related premium rates, and the Part B deductible are the same as the respective amounts for 2013. As a result, this notice is not economically significant under section 3(f)(1) of Executive Order 12866 and thus, is not a major action under the Congressional Review Act. In accordance with the provisions of Executive Order 12866, this notice was reviewed by the Office of Management and Budget.
As discussed earlier, this notice announces that the monthly actuarial rates applicable for 2014 are $209.80 for enrollees age 65 and over and $218.90 for disabled enrollees under age 65. It also announces the 2014 monthly Part B premium rates to be paid by beneficiaries who file an individual tax return (including those who are single, head of household, qualifying widow(er) with a dependent child, or married filing separately who lived apart from their spouse for the entire taxable year), or a joint tax return.
In addition, the monthly premium rates to be paid by beneficiaries who are married and lived with their spouse at any time during the taxable year, but file a separate tax return from their spouse, are also announced and listed in the following chart:
The RFA requires agencies to analyze options for regulatory relief of small businesses, if a rule has a significant impact on a substantial number of small entities. For purposes of the RFA, small entities include small businesses, nonprofit organizations, and small governmental jurisdictions. Most hospitals and most other providers and suppliers are small entities, either by nonprofit status or by having revenues of less than $7.0 million to $34.5 million in any 1 year. Individuals and States are not included in the definition of a small entity. This notice announces the monthly actuarial rates for aged (age 65 and over) and disabled (under 65) beneficiaries enrolled in Part B of the Medicare SMI program beginning January 1, 2014. Also, this notice announces the monthly premium for aged and disabled beneficiaries as well as the income-related monthly adjustment amounts to be paid by beneficiaries with modified adjusted gross income above certain threshold amounts. As a result, we are not preparing an analysis for the RFA because the Secretary has determined that this notice will not have a significant economic impact on a substantial number of small entities.
In addition, section 1102(b) of the Act requires us to prepare a regulatory impact analysis if a rule may have a significant impact on the operations of a substantial number of small rural hospitals. This analysis must conform to the provisions of section 604 of the RFA. For purposes of section 1102(b) of the Act, we define a small rural hospital as a hospital that is located outside of a Metropolitan Statistical Area and has fewer than 100 beds. As we discussed previously, we are not preparing an analysis for section 1102(b) of the Act because the Secretary has determined that this notice will not have a significant effect on a substantial number of small rural hospitals
Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) also requires that agencies assess anticipated costs and benefits before issuing any rule whose mandates require spending in any 1 year of $100 million in 1995 dollars, updated annually for inflation. In 2013, that threshold is approximately $141 million. This notice does not impose mandates that will have a consequential effect of $142 million or more on State, local, or tribal governments or on the private sector.
Executive Order 13132 establishes certain requirements that an agency must meet when it publishes a proposed rule (and subsequent final rule) that imposes substantial direct compliance costs on State and local governments, preempts State law, or otherwise has Federalism implications. We have determined that this notice does not significantly affect the rights, roles, and responsibilities of States.
For 2014, the standard Part B premium rate, the Part B income-related premium rates, and the Part B deductible are the same as the respective amounts for 2013. Therefore, this notice is not a major rule as defined in 5 U.S.C. 804(2) and is not an economically significant rule under Executive Order 12866.
In accordance with the provisions of Executive Order 12866, this notice was reviewed by the Office of Management and Budget.
The Medicare statute requires the publication of the monthly actuarial rates and the Part B premium amounts in September. We ordinarily use general notices, rather than notice and comment rulemaking procedures, to make such announcements. In doing so, we note that, under the Administrative Procedure Act, interpretive rules, general statements of policy, and rules of agency organization, procedure, or practice are excepted from the requirements of notice and comment rulemaking.
We considered publishing a proposed notice to provide a period for public comment. However, we may waive that procedure if we find, for good cause, that prior notice and comment are impracticable, unnecessary, or contrary to the public interest. The statute establishes the time period for which the premium rates will apply, and delaying publication of the Part B premium rate such that it would not be published before that time would be contrary to the public interest. Moreover, we find that notice and comment are unnecessary because the formulas used to calculate the Part B premiums are statutorily directed. Therefore, we find good cause to waive publication of a proposed notice and solicitation of public comments.
Centers for Medicare & Medicaid Services (CMS), HHS.
Notice.
This annual notice announces Medicare's Hospital Insurance (Part A) premium for uninsured enrollees in calendar year (CY) 2014. This premium is paid by enrollees age 65 and over who are not otherwise eligible for benefits under Medicare Part A (hereafter known as the “uninsured aged”) and by certain disabled individuals who have exhausted other entitlement. The monthly Part A premium for the 12 months beginning January 1, 2014, for these individuals will be $426. The premium for certain other individuals as described in this notice will be $234.
Clare McFarland, (410) 786-6390.
Section 1818 of the Social Security Act (the Act) provides for voluntary enrollment in the Medicare Hospital Insurance Program (Medicare Part A), subject to payment of a monthly premium, of certain persons aged 65 and older who are uninsured under the Old-Age, Survivors, and Disability Insurance (OASDI) program or the Railroad Retirement Act and do not otherwise meet the requirements for entitlement to Medicare Part A. These “uninsured aged” individuals are uninsured under the OASDI program or the Railroad Retirement Act, because they do not have 40 quarters of coverage under Title II of the Act (or are/were not married to someone who did). (Persons insured under the OASDI program or the Railroad Retirement Act and certain others do not have to pay premiums for Medicare Part A.)
Section 1818A of the Act provides for voluntary enrollment in Medicare Part A, subject to payment of a monthly premium for certain disabled individuals who have exhausted other entitlement. These are individuals who were entitled to coverage due to a disabling impairment under section 226(b) of the Act, but who are no longer entitled to disability benefits and free Medicare Part A coverage because they have gone back to work and their earnings exceed the statutorily defined “substantial gainful activity” amount (section 223(d)(4) of the Act).
Section 1818A(d)(2) of the Act specifies that the provisions relating to premiums under section 1818(d) through section 1818(f) of the Act for the aged will also apply to certain disabled individuals as described above.
Section 1818(d) of the Act requires us to estimate, on an average per capita basis, the amount to be paid from the Federal Hospital Insurance Trust Fund for services incurred in the upcoming calendar year (CY) (including the associated administrative costs) on behalf of individuals aged 65 and over who will be entitled to benefits under Medicare Part A. We must then determine the monthly actuarial rate for the following year (the per capita amount estimated above divided by 12) and publish the dollar amount for the monthly premium in the succeeding CY. If the premium is not a multiple of $1, the premium is rounded to the nearest multiple of $1 (or, if it is a multiple of 50 cents but not of $1, it is rounded to the next highest $1).
Section 13508 of the Omnibus Budget Reconciliation Act of 1993 (Pub. L. 103-66) amended section 1818(d) of the Act to provide for a reduction in the premium amount for certain voluntary enrollees (section 1818 and section 1818A of the Act). The reduction applies to an individual who is eligible to buy into the Medicare Part A program and who, as of the last day of the previous month:
• Had at least 30 quarters of coverage under Title II of the Act;
• Was married, and had been married for the previous 1-year period, to a person who had at least 30 quarters of coverage;
• Had been married to a person for at least 1 year at the time of the person's death if, at the time of death, the person had at least 30 quarters of coverage; or
• Is divorced from a person and had been married to the person for at least 10 years at the time of the divorce if, at the time of the divorce, the person had at least 30 quarters of coverage.
Section 1818(d)(4)(A) of the Act specifies that the premium that these individuals will pay for CY 2014 will be equal to the premium for uninsured aged enrollees reduced by 45 percent.
The monthly premium for the uninsured aged and certain disabled individuals who have exhausted other entitlement for the 12 months beginning January 1, 2014, is $426.
The monthly premium for the individuals eligible under Section 1818(d)(4)(B) of the Act, and therefore subject to the 45 percent reduction in the monthly premium, is $234.
As discussed in section I of this notice, the monthly Medicare Part A premium is equal to the estimated monthly actuarial rate for CY 2014 rounded to the nearest multiple of $1 and equals one-twelfth of the average per capita amount, which is determined by projecting the number of Part A enrollees aged 65 years and over as well as the benefits and administrative costs that will be incurred on their behalf.
The steps involved in projecting these future costs to the Federal Hospital Insurance Trust Fund are:
• Establishing the present cost of services furnished to beneficiaries, by type of service, to serve as a projection base;
• Projecting increases in payment amounts for each of the service types; and
• Projecting increases in administrative costs.
We base our projections for CY 2014 on: (1) Current historical data, and (2) projection assumptions derived from current law and the Mid-Session Review of the President's Fiscal Year 2014 Budget.
We estimate that in CY 2014, 43,923,567 people aged 65 years and over will be entitled to benefits (without premium payment) and that they will incur about $224.753 billion in benefits and related administrative costs. Thus, the estimated monthly average per capita amount is $426.41 and the monthly premium is $426. Subsequently, the full monthly premium reduced by 45 percent is $234.
The CY 2014 premium of $426 is approximately 3.40 percent lower than the CY 2013 premium of $441. We estimate that approximately 626,000 enrollees will voluntarily enroll in Medicare Part A by paying the full premium. Furthermore, the CY 2014 reduced premium of $234 is approximately 3.70 percent lower than the CY 2013 premium of $243. We estimate an additional 55,000 enrollees will pay the reduced premium. Therefore, we estimate that the total aggregate savings to enrollees paying these premiums in CY 2014, compared to the amount that they paid in CY 2013, will be about $119 million.
We use general notices, rather than notice and comment rulemaking procedures, to make announcements such as this premium notice. In doing so, we acknowledge that, under the Administrative Procedure Act (APA), interpretive rules, general statements of policy, and rules of agency organization, procedure, or practice are excepted from the requirements of notice and comment rulemaking. The agency may also waive notice and comment if there is “good cause,” as defined by the statute. We considered publishing a proposed notice to provide a period for public comment. However, under the APA, we may waive that procedure if we find good cause that prior notice and comment are impracticable, unnecessary, or contrary to the public interest.
We are not using notice and comment rulemaking in this notification of Medicare Part A premiums for CY 2014 as that procedure is unnecessary because of the lack of discretion in the statutory formula that is used to calculate the premium and the solely ministerial function that this notice serves. The APA permits agencies to
This document does not impose information collection and recordkeeping requirements. Consequently, it need not be reviewed by the Office of Management and Budget under the authority of the Paperwork Reduction Act of 1995 (44 U.S.C. 35).
Section 1818(d) of the Act requires the Secretary of the Department of Health and Human Services (the Secretary) during September of each year to determine and publish the amount to be paid, on an average per capita basis, from the Federal Hospital Insurance Trust Fund for services incurred in the impending calendar year (CY) (including the associated administrative costs) on behalf of individuals aged 65 and over who will be entitled to benefits under Medicare Part A.
We have examined the impacts of this rule as required by Executive Order 12866 on Regulatory Planning and Review (September 30, 1993), Executive Order 13563 on Improving Regulation and Regulatory Review (January 18, 2011), the Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354), section 1102(b) of the Social Security Act, section 202 of the Unfunded Mandates Reform Act of 1995 (March 22, 1995; Pub. L. 104-4), Executive Order 13132 on Federalism (August 4, 1999), and the Congressional Review Act (5 U.S.C., Part I, Ch. 8).
Executive Orders 12866 and 13563 direct agencies to assess all 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). A regulatory impact analysis (RIA) must be prepared for major notices with economically significant effects ($100 million or more in any 1 year). As stated in section IV of this notice, we estimate that the overall effect of the changes in the Part A premium will be a savings to voluntary enrollees (section 1818 and section 1818A of the Act) of about $119 million. As a result, this notice is economically significant under section 3(f)(1) of Executive Order 12866 and thus, a major action under the Congressional Review Act. In accordance with the provisions of Executive Order 12866, this notice was reviewed by the Office of Management and Budget.
The RFA requires agencies to analyze options for regulatory relief of small entities, if a rule has a significant impact on a substantial number of small entities. For purposes of the RFA, small entities include small businesses, nonprofit organizations, and small governmental jurisdictions. Most hospitals and most other providers and suppliers are small entities, either by nonprofit status or by having revenues of less than $7.0 million to $35.5 million in any 1 year (for details, see the Small Business Administration's Web site at
Individuals and states are not included in the definition of a small entity. As discussed above, this annual notice announces Medicare's Hospital Insurance (Part A) premium for uninsured enrollees in calendar year (CY) 2014. As a result, we are not preparing an analysis for the RFA because the Secretary has determined that this notice will not have a significant economic impact on a substantial number of small entities.
In addition, section 1102(b) of the Social Security Act requires us to prepare a regulatory impact analysis if a rule may have a significant impact on the operations of a substantial number of small rural hospitals. This analysis must conform to the provisions of section 604 of the RFA. For purposes of section 1102(b) of the Act, we define a small rural hospital as a hospital that is located outside of a Metropolitan Statistical Area for Medicare payment regulations and has fewer than 100 beds. As discussed above, we are not preparing an analysis for section 1102(b) of the Act, because the Secretary has determined that this notice will not have a significant impact on the operations of a substantial number of small rural hospitals.
Section 202 of the Unfunded Mandates Reform Act of 1995 also requires that agencies assess anticipated costs and benefits before issuing any rule whose mandates require spending in any 1 year of $100 million in 1995 dollars, updated annually for inflation. In 2013, that threshold is approximately $141 million. This notice does not impose mandates that will have a consequential effect of $141 million or more on state, local, or tribal governments or on the private sector.
Executive Order 13132 establishes certain requirements that an agency must meet when it promulgates a proposed rule (and subsequent final rule) that imposes substantial direct requirement costs on state and local governments, preempts state law, or otherwise has Federalism implications. Since this notice does not impose any costs on state or local governments, the requirements of Executive Order 13132 are not applicable.
Centers for Medicare & Medicaid Services (CMS), HHS.
Notice.
This notice announces the inpatient hospital deductible and the hospital and extended care services coinsurance amounts for services furnished in calendar year (CY) 2014 under Medicare's Hospital Insurance Program (Medicare Part A). The Medicare statute specifies the formulae used to determine these amounts. For CY 2014, the inpatient hospital deductible will be $1,216. The daily coinsurance amounts for CY 2014 will be: $304 for the 61st through 90th day of hospitalization in a benefit period; $608 for lifetime reserve days; and $152 for the 21st through 100th day of extended care services in a skilled nursing facility in a benefit period.
Clare McFarland, (410) 786-6390 for
Section 1813 of the Social Security Act (the Act) provides for an inpatient hospital deductible to be subtracted from the amount payable by Medicare for inpatient hospital services furnished to a beneficiary. It also provides for certain coinsurance amounts to be subtracted from the amounts payable by Medicare for inpatient hospital and extended care services. Section 1813(b)(2) of the Act requires us to determine and publish each year the amount of the inpatient hospital deductible and the hospital and extended care services coinsurance amounts applicable for services furnished in the following calendar year (CY).
Section 1813(b) of the Act prescribes the method for computing the amount of the inpatient hospital deductible. The inpatient hospital deductible is an amount equal to the inpatient hospital deductible for the preceding CY, adjusted by our best estimate of the payment-weighted average of the applicable percentage increases (as defined in section 1886(b)(3)(B) of the Act) used for updating the payment rates to hospitals for discharges in the fiscal year (FY) that begins on October 1 of the same preceding CY, and adjusted to reflect changes in real case-mix. The adjustment to reflect real case-mix is determined on the basis of the most recent case-mix data available. The amount determined under this formula is rounded to the nearest multiple of $4 (or, if midway between two multiples of $4, to the next higher multiple of $4).
Under section 1886(b)(3)(B)(i)(XX) of the Act, the percentage increase used to update the payment rates for FY 2014 for hospitals paid under the inpatient prospective payment system is the market basket percentage increase, otherwise known as the market basket update, reduced by 0.3 percentage points (see section 1886(b)(3)(B)(xii)(II) of the Act), and an adjustment based on changes in the economy-wide productivity (the multifactor productivity (MFP) adjustment (see section 1886(b)(3)(B)(xi)(II) of the Act). Under section 1886(b)(3)(B)(viii) of the Act, hospitals will receive this update only if they submit quality data as specified by the Secretary of the Department of Health and Services (the Secretary). The update for hospitals that do not submit this data is reduced by 2.0 percentage points. We are estimating that after accounting for those hospitals receiving the lower market basket update in the payment-weighted average update, the calculated deductible will remain the same, as the majority of hospitals submit quality data and receive the full market basket update.
Under section 1886(b)(3)(B)(ii)(VIII) of the Act, the percentage increase used to update the payment rates for FY 2014 for hospitals excluded from the inpatient prospective payment system is as follows:
• For FY 2014, the percentage increase for long term care hospitals is the market basket percentage increase reduced by 0.3 percentage points and the MFP adjustment (see sections 1886(m)(3)(A) and 1886(m)(4)(C) of the Act).
• For FY 2014, the percentage increase for inpatient rehabilitation facilities is the market basket percentage increase reduced by 0.3 percentage points and the MFP adjustment (see sections 1886(j)(3)(C) and 1886(j)(3)(D)(ii) of the Act).
• For FY 2014, the percentage increase used to update the payment rate for psychiatric hospitals is the market basket percentage increase reduced by 0.1 percentage points and the MFP adjustment (see sections 1886(s)(2)(A)(ii) and 1886(s)(3)(B) of the Act).
The Inpatient Prospective Payment System market basket percentage increase for 2014 is 2.5 percent and the MFP adjustment is 0.5 percent, as announced in the final rule with comment period published in the
To develop the adjustment to reflect changes in real case-mix, we first calculated an average case-mix for each hospital that reflects the relative costliness of that hospital's mix of cases compared to those of other hospitals. We then computed the change in average case-mix for hospitals paid under the Medicare prospective payment system in FY 2013 compared to FY 2012. (We excluded from this calculation hospitals whose payments are not based on the inpatient prospective payment system because their payments are based on alternate prospective payment systems or reasonable costs.) We used Medicare bills from prospective payment hospitals that we received as of July 2013. These bills represent a total of about 7.8 million Medicare discharges for FY 2013 and provide the most recent case-mix data available at this time. Based on these bills, the change in average case-mix in FY 2013 is 0.89 percent. Based on these bills and past experience, we expect the overall case mix change to be 1.0 percent as the year progresses and more FY 2013 data become available.
Section 1813 of the Act requires that the inpatient hospital deductible be adjusted only by that portion of the case-mix change that is determined to be real. We estimate that the change in real case mix will be 1.0 percent.
Thus, the estimate of the payment-weighted average of the applicable percentage increases used for updating the payment rates is 1.73 percent, and the real case-mix adjustment factor for the deductible is 1.0 percent. Therefore, under the statutory formula, the inpatient hospital deductible for services furnished in CY 2014 is $1,216. This deductible amount is determined by multiplying $1,184 (the inpatient hospital deductible for CY 2013) by the payment-weighted average increase in the payment rates of 1.0173 multiplied by the increase in real case-mix of 1.01, which equals $1,216.53 and is rounded to $1,216.
The coinsurance amounts provided for in section 1813 of the Act are defined as fixed percentages of the inpatient hospital deductible for services furnished in the same CY. The increase in the deductible generates increases in the coinsurance amounts. For inpatient hospital and extended care services furnished in CY 2014, in accordance with the fixed percentages defined in the law, the daily coinsurance for the 61st through 90th day of hospitalization in a benefit period will be $304 (one-fourth of the inpatient hospital deductible); the daily coinsurance for lifetime reserve days will be $608 (one-half of the inpatient
Table 1 below summarizes the deductible and coinsurance amounts for CYs 2013 and 2014, as well as the number of each that is estimated to be paid.
The estimated total increase in costs to beneficiaries is about $870 million (rounded to the nearest $10 million) due to—(1) the increase in the deductible and coinsurance amounts; and (2) the increase in the number of deductibles and daily coinsurance amounts paid.
The Medicare statute, as discussed previously, requires publication of the Medicare Part A inpatient hospital deductible and the hospital and extended care services coinsurance amounts for services for each CY. The amounts are determined according to the statute. As has been our custom, we use general notices, rather than notice and comment rulemaking procedures, to make the announcements. In doing so, we acknowledge that, under the Administrative Procedure Act (APA), interpretive rules, general statements of policy, and rules of agency organization, procedure, or practice are excepted from the requirements of notice and comment rulemaking.
We considered publishing a proposed notice to provide a period for public comment. However, we may waive that procedure if we find good cause that prior notice and comment are impracticable, unnecessary, or contrary to the public interest. We find that the procedure for notice and comment is unnecessary because the formulae used to calculate the inpatient hospital deductible and hospital and extended care services coinsurance amounts are statutorily directed, and we can exercise no discretion in following the formulae. Moreover, the statute establishes the time period for which the deductible and coinsurance amounts will apply and delaying publication would be contrary to the public interest. Therefore, we find good cause to waive publication of a proposed notice and solicitation of public comments.
This document does not impose information collection and recordkeeping requirements. Consequently, it need not be reviewed by the Office of Management and Budget under the authority of the Paperwork Reduction Act of 1995 (44 U.S.C. 35).
Section 1813(b)(2) of the Act requires the Secretary to determine and publish, between September 1 and September 15 of each year, the amount of the inpatient hospital deductible and the hospital and extended care services coinsurance amounts applicable for services furnished in the following calendar year (CY).
We have examined the impacts of this rule as required by Executive Order 12866 on Regulatory Planning and Review (September 30, 1993), Executive Order 13563 on Improving Regulation and Regulatory Review (January 18, 2011), the Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354), section 1102(b) of the Social Security Act, section 202 of the Unfunded Mandates Reform Act of 1995 (March 22, 1995; Pub. L. 104-4), Executive Order 13132 on Federalism (August 4, 1999) and the Congressional Review Act (5 U.S.C., Part I, Ch. 8).
Executive Orders 12866 and 13563 direct agencies to assess all 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). A regulatory impact analysis (RIA) must be prepared for major notices with economically significant effects ($100 million or more in any 1 year). As stated in section IV of this notice, we estimate that the total increase in costs to beneficiaries associated with this notice is about $870 million due to—(1) the increase in the deductible and coinsurance amounts; and (2) the increase in the number of deductibles and daily coinsurance amounts paid. As a result, this notice is economically significant under section 3(f)(1) of Executive Order 12866 and thus, is a major action under the Congressional Review Act. In accordance with the provisions of Executive Order 12866, this notice was reviewed by the Office of Management and Budget.
The RFA requires agencies to analyze options for regulatory relief of small entities, if a rule has a significant impact on a substantial number of small entities. For purposes of the RFA, small entities include small businesses, nonprofit organizations, and small governmental jurisdictions. Most hospitals and most other providers and suppliers are small entities, either by nonprofit status or by having revenues of less than $7.0 million to $35.5 million in any 1 year (for details, see the Small Business Administration's Web site at
Individuals and states are not included in the definition of a small entity. As discussed above, this annual notice announces the inpatient hospital deductible and the hospital and extended care services coinsurance amounts for services furnished in CY 2014 under Medicare's Hospital Insurance Program (Medicare Part A). As a result, we are not preparing an
In addition, section 1102(b) of the Social Security Act requires us to prepare a regulatory impact analysis if a rule may have a significant impact on the operations of a substantial number of small rural hospitals. This analysis must conform to the provisions of section 604 of the RFA. For purposes of section 1102(b) of the Act, we define a small rural hospital as a hospital that is located outside of a Metropolitan Statistical Area for Medicare payment regulations and has fewer than 100 beds. As discussed above, we are not preparing an analysis for section 1102(b) of the Act because the Secretary has determined that this notice will not have a significant impact on the operations of a substantial number of small rural hospitals.
Section 202 of the Unfunded Mandates Reform Act of 1995 also requires that agencies assess anticipated costs and benefits before issuing any rule whose mandates require spending in any 1 year of $100 million in 1995 dollars, updated annually for inflation. For 2013, that threshold accounting for inflation is approximately $141 million. This notice does not impose mandates that will have a consequential effect of $141 million or more on state, local, or tribal governments or on the private sector. However, states may be required to pay the deductibles and coinsurance for dually-eligible beneficiaries.
Executive Order 13132 establishes certain requirements that an agency must meet when it promulgates a proposed rule (and subsequent final rule) that imposes substantial direct requirement costs on state and local governments, preempts state law, or otherwise has Federalism implications. Since this notice does not impose any costs on state or local governments, preempt state law or have Federalism implications, the requirements of Executive Order 13132 are not applicable.
Food and Drug Administration, HHS.
Notice.
This notice announces a forthcoming meeting of a public advisory committee of the Food and Drug Administration (FDA). The meeting will be open to the public.
FDA intends to make background material available to the public no later than 2 business days before the meeting. If FDA is unable to post the background material on its Web site prior to the meeting, the background material will be made publicly available at the location of the advisory committee meeting, and the background material will be posted on FDA's Web site after the meeting. Background material is available at
Persons attending FDA's advisory committee meetings are advised that the Agency is not responsible for providing access to electrical outlets.
FDA welcomes the attendance of the public at its advisory committee
FDA is committed to the orderly conduct of its advisory committee meetings. Please visit our Web site at
Notice of this meeting is given under the Federal Advisory Committee Act (5 U.S.C. app. 2).
Food and Drug Administration, HHS.
Notice.
This notice announces a forthcoming meeting of two public advisory committees of the Food and Drug Administration (FDA). The meeting will be open to the public.
FDA intends to make background material available to the public no later than 2 business days before the meeting. If FDA is unable to post the background material on its Web site prior to the meeting, the background material will be made publicly available at the location of the advisory committee meeting, and the background material will be posted on FDA's Web site after the meeting. Background material is available at
Persons attending FDA's advisory committee meetings are advised that the Agency is not responsible for providing access to electrical outlets.
FDA welcomes the attendance of the public at its advisory committee meetings and will make every effort to accommodate persons with physical disabilities or special needs. If you require special accommodations due to a disability, please contact Cindy Hong at least 7 days in advance of the meeting.
FDA is committed to the orderly conduct of its advisory committee meetings. Please visit our Web site at
Notice of this meeting is given under the Federal Advisory Committee Act (5 U.S.C. app. 2).
Notice is hereby given of a change in the meeting of the Center for Scientific Review Special Emphasis Panel, October 23, 2013, 09:00 a.m. to October 23, 2013, 06:00 p.m., National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD 20892 which was published in the
The meeting will be held on November 26, 2013 from 09:00 a.m. to 06:30 p.m. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Therapeutic Approaches to Genetic Diseases Study Section, October 21, 2013, 8:30 a.m. to October 21, 2013, 3:00 p.m., Amalfi Hotel, 20 West Kinzie Street, Chicago, IL 60654 which was published in the
The meeting will be held at the National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD 20892 on November 25, 2013. The meeting time remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Integrative Physiology of Obesity and Diabetes Study Section, October 24, 2013, 8:00 a.m. to October 25, 2013, 5:00 p.m., Avenue Hotel Chicago, 160 E. Huron Street, Chicago, IL, 60611 which was published in the
The meeting will start on December 19, 2013 at 8:00 a.m. and end on December 20, 2013 at 6:00 p.m. The location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the National Cancer Institute Special Emphasis Panel, October 15, 2013, 4:00 p.m. to October 16, 2013, 5:00 p.m., Bethesda North Marriott Hotel & Conference Center, 5701 Marinelli Road, Bethesda, MD, 20852 which was published in the
Due to the absence of either an FY 2014 appropriation or Continuing Resolution for the Department of Health and Human Services, the meeting is rescheduled for November 12-13, 2013 from 4:00 p.m. to 5:00 p.m. Additionally, the meeting location has changed to Hilton Rockville Hotel, 1750 Rockville Pike, Rockville, MD 20852. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Subcommittee J—Career Development, October 24, 2013, 8:00 a.m. to October 25, 2013, 6:00 p.m., National Cancer Institute Shady Grove, West Tower, 9609 Medical Center Drive, 7W032-24th & 7W30-25th, Rockville, MD, 20850 which was published in the
Due to the absence of either an FY 2014 appropriation or Continuing Resolution for the Department of Health & Human Services, the meeting is rescheduled for November 14, 2013 from 8:00 a.m. to 6:00 p.m. and the location remains the same, however the room has changed to 4E032. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the National Institute on Drug Abuse Special Emphasis Panel, October 15, 2013, 2:00 p.m. to October 16, 2013, 1:00 p.m., Hilton Garden Inn Washington DC/Bethesda, 7301 Waverly Street, Bethesda, MD 21045 which was published in the
The date, time and location of the meeting are changed to November 13, 2013, 1:30 p.m. to November 14, 2013, 1:00 p.m., Hyatt Regency Bethesda, One Bethesda Metro Center, 7400 Wisconsin Avenue, Bethesda, MD 20814. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Genetic Variation and Evolution Study Section, October 17, 2013, 8:00 a.m. to October 18, 2013, 2:00 p.m., Sheraton Delfina Santa Monica Hotel, 530 West Pico Boulevard, Santa Monica, CA 90405 which was published in the
The meeting will be held at the National Institutes of Health, 6701 Rockledge Dr., Bethesda, MD 20892. The meeting will start on December 16, 2013 at 10:00 a.m. and end on December 18, 2013 at 6:00 p.m. The meeting is closed to the public.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meeting.
The meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
This meeting notice is being published less than 15 days in advance of the meeting due to the Government shutdown of October 2013.
Information is also available on the Institute's/Center's home page:
Notice is hereby given of a change in the meeting of the Molecular and Cellular Hematology Study Section, October 15, 2013, 08:00 a.m. to October 16, 2013, 06:00 p.m., Embassy Suites at the Chevy Chase Pavilion, 4300 Military Road NW., Washington, DC 20015 which was published in the
The meeting will be held at the National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD 20892. The meeting will start on December 2, 2013 at 11:00 a.m. and end on December 4, 2013 at 6:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Developmental Therapeutics Study Section, October 07, 2013, 08:00 a.m. to October 08, 2013, 05:00 p.m., Hotel Monaco Alexandria, 480 King Street, Alexandria, VA 22314 which was published in the
The meeting will start on November 21, 2013 at 07:00 p.m. and end on November 22, 2013 at 06:00 p.m. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Hemostasis and Thrombosis Study Section, October 16, 2013, 11:00 a.m. to October 16, 2013, 06:00 p.m., National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD, 20892 which was published in the
The meeting will start on December 18, 2013 at 12:00 p.m. and end on December 18, 2013 at 5:00 p.m.
The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Integrative and Clinical Endocrinology and Reproduction Study Section, October 23, 2013, 08:00 a.m. to October 23, 2013, 05:00 p.m., Sheraton Silver Spring Hotel, 8777 Georgia Avenue, Silver Spring, MD 20910 which was published in the
The meeting will be held at the National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD 20892 on December 17, 2013. The meeting will start at 10:00 a.m. and end at 6:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Center for Scientific Review Special Emphasis Panel, October 21, 2013, 03:30 p.m. to October 21, 2013, 06:00 p.m., Amalfi Hotel, 20 West Kinzie Street, Chicago, IL 60654 which was published in the
The meeting will be held at the National Institutes of Health 6701 Rockledge Drive, Bethesda, MD 20892 on November 25, 2013. The meeting time remains the same. The meeting is closed to the public.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App), notice is hereby given of the following meetings.
The meetings will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable materials, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Notice is hereby given of a change in the meeting of the Language and Communication Study Section, October 11, 2013, 8:00 a.m. to October 11, 2013, 6:00 p.m., Doubletree Hotel Washington, 1515 Rhode Island Ave. NW., Washington, DC 20005 which was published in the
The meeting will start on December 13, 2013 at 8:00 a.m. and will end on December 13, 2013 at 6:00 p.m. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Center for Scientific Review Special Emphasis Panel, October 18, 2013, 10:30 a.m. to October 18, 2013, 5:30 p.m., National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD 20892 which was published in the Federal Register on September 25, 2013, 78 FR 186 pgs. 59040-59041.
The meeting will start on December 3, 2013 at 8:00 a.m. and end on December 3, 2013 at 5:00 PM. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Mechanisms of Sensory, Perceptual, and Cognitive Processes Study Section, October 03, 2013, 08:00 a.m. to October 04, 2013, 05:30 p.m., Melrose Hotel, 2430 Pennsylvania Ave. NW., Washington, DC 20037 which was published in the
The meeting will be held at the Bahia Hotel, 998 W. Mission Bay Drive, San Diego, CA 92109 on November 8, 2013, starting at 08:00 a.m. and ending at 06:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Biophysics of Neural Systems Study Section, October 3, 2013, 8:00 a.m. to October 3, 2013, 7:00 p.m., Hotel Monaco, 2 North Charles Street, Baltimore, MD 21201 which was published in the
The meeting will start on November 20, 2013 at 8:00 a.m. and will end on November 20, 2013 at 7:00 p.m. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Psychosocial Development, Risk and Prevention Study Section, October 3, 2013, 8:00 a.m. to October 4, 2013, 6:00 p.m., Bethesda North Marriott Hotel & Conference Center, 5701 Marinelli Road, Bethesda, MD 20852 which was published in the
The meeting will be held at the Hotel Helix, 1430 Rhode Island Ave. NW., Washington, DC 20005. The meeting will start on December 5, 2013 at 8:00 a.m. and end on December 6, 2013 at 5:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Hypertension and Microcirculation Study Section, October 10, 2013, 08:00 a.m. to October 10, 2013, 07:30 p.m., Washington Hilton Hotel, 1919 Connecticut Ave. NW., Washington, DC 20009 which was published in the
The meeting will start on December 19, 2013 at 7:30 a.m. and end on December 19, 2013 at 8:00 p.m. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Center for Scientific Review Special Emphasis Panel, October 31, 2013, 8:00 a.m. to November 1, 2013, 1:00 p.m., One Washington Circle Hotel, One Washington Circle, Washington, DC 20037 which was published in the
The meeting will start on November 22, 2013 at 8:00 a.m. and will end on November 22, 2013 at 6:00 p.m. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Center for Scientific Review Special Emphasis Panel, October 11, 2013, 1:00 p.m. to October 11, 2013, 6:00 p.m., National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD 20892 which was published in the
The meeting will start on November 19, 2013 at 11:00 a.m. and will end on November 19, 2013 at 5:00 p.m. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Molecular Genetics A Study Section, October 21, 2013, 08:30 a.m. to October 22, 2013, 01:30 p.m., Renaissance Washington DC, Dupont Circle, 1143 New Hampshire Avenue NW., Washington, DC 20037 which was published in the
The meeting will start on November 17, 2013 at 8:30 a.m. and end on November 17, 2013 at 7:30 p.m. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Center for Scientific Review Special Emphasis Panel, October 22, 2013, 02:00 p.m. to October 22, 2013, 05:00 p.m., National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD 20892 which was published in the
The meeting will be held on December 10, 2013. The meeting time and location remain the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the National Institute of Allergy and Infectious Diseases Special Emphasis Panel, October 21, 2013, 8:00 a.m. to October 22, 2013, 4:00 p.m., Hilton Washington/Rockville, 1750 Rockville Pike, Regency Ballroom, Rockville, MD, 20852 which was published in the
The meeting is amended to change the date of the meeting from Oct. 21-22, 2013 to Nov. 22, 2013 and Nov. 25, 2013. Telephone Conference Call, National Institutes of Health, 6700B Rockledge Dr., Bethesda, MD 20817 from 8:00 a.m. to 5:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the National Institute on Drug Abuse Special Emphasis Panel, October 15, 2013, 9:00 a.m. to October 15, 2013, 11:00 p.m., Hilton Garden Inn Washington DC/Bethesda, 7301 Waverly Street, Bethesda, MD 21045 which was published in the
The date, time and location of the meeting are changed to November 13, 2013, 10:30 a.m. to November 13, 2013, 12:30 p.m., Hyatt Regency Bethesda, One Bethesda Metro Center, 7400 Wisconsin Avenue, Bethesda, MD 20814. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Neural Basis of Psychopathology, Addictions and Sleep Disorders Study Section, October 02, 2013, 08:00 a.m. to October 03, 2013, 05:00 p.m., Amalfi Hotel, 20 West Kinzie Street, Chicago, IL 60654 which was published in the
The meeting will be held at the Hyatt Regency Baltimore, 300 Light Street, Baltimore, MD 21202. The meeting will start on November 20, 2013 at 8:00 a.m. and end on November 21, 2013 at 5:00 PM. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Pathobiology of Kidney Disease Study Section, October 07, 2013, 08:00 a.m. to October 07, 2013, 07:00 p.m., Residence Inn Bethesda, 7335 Wisconsin Avenue, Bethesda, MD 20814 which was published in the
The meeting will be held on November 18, 2013. The meeting time and location remain the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the National Center for Complementary and Alternative Medicine Special Emphasis Panel, October 16, 2013, 2:00 p.m. to October 16, 2013, 6:00 p.m., National Institutes of Health, Two Democracy Plaza, 6707 Democracy Boulevard, Bethesda, MD 20892 which was published in the
The meeting of the Special Emphasis Panel ZAT1 PK 28, PAR 10-163 R34, will be held on November 19, 2013, instead of October 16, 2013, at noon and will end at 3:00 p.m. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Behavior and Social Science of Aging Review Committee, October 03, 2013, 04:30 p.m. to October 04, 2013, 02:00 p.m., Doubletree Hotel Bethesda, 8120 Wisconsin Avenue, Bethesda, MD 20814 which was published in the
The meeting has been changed to December 10, 2013, 03:00 p.m. to 07:00 p.m. and December 11, 2013, 09:00 a.m. to 07:00 p.m. This meeting is now a teleconference. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Acute Neural Injury and Epilepsy Study Section, October 16, 2013, 08:00 a.m. to October 16, 2013, 06:30 p.m., Washington Plaza Hotel, 10 Thomas Circle, Washington, DC 20005 which was published in the
The meeting will start on December 11, 2013 at 8:00 a.m. and end on December 11, 2013 at 6:00 p.m. The meeting location remains the same. The meeting is closed to the public.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meeting.
The meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
This meeting notice is being published less than 15 days in advance of the meeting due to the Government shutdown of 2013.
Notice is hereby given of a change in the meeting of the Center for Scientific Review Special Emphasis Panel, October 8, 2013, 7:00 a.m. to October 8, 2013, 8:00 p.m., National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD 20892 which was published in the
The meeting will start on November 21, 2013 at 7:00 a.m. and end on November 22, 2013 at 8:00 p.m. The location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Social Sciences and Population Studies B Study Section, October 23, 2013, 08:00 a.m. to October 23, 2013, 06:00 p.m., Embassy Suites Baltimore Downtown, 222 St. Paul Place, Baltimore, MD, 21202 which was published in the
The meeting will be held at National Institutes of Health, 6701 Rockledge Dr., Bethesda, MD 20892. The meeting will start on December 18 at 08:30 a.m. and
Notice is hereby given of a change in the meeting of the National Institute of Allergy and Infectious Diseases Special Emphasis Panel, October 23, 2013, 08:00 a.m. to October 24, 2013, 06:00 p.m., Hyatt Regency Bethesda, One Bethesda Metro Center, 7400 Wisconsin Avenue, Bethesda, MD 20814 which was published in the
The meeting notice is amended to change the date of the meeting from Oct. 23-24, 2013 to Nov. 12-13, 2013, from the Hyatt Regency Hotel to the Sheraton Silver Spring Hotel, 8777 Georgia Avenue, Silver Spring, MD 20910. The meeting is closed to the public.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meeting.
The meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
This meeting notice is being published less than 15 days in advance of the meeting due to the Government shutdown of October 2013.
Notice is hereby given of a change in the meeting of the Host Interactions with Bacterial Pathogens Study Section, October 18, 2013, 8:00 a.m. to October 18, 2013, 6:00 p.m., Hyatt Regency Bethesda, One Bethesda Metro Center, 7400 Wisconsin Avenue, Bethesda, MD 20814 which was published in the
The meeting will start on November 15, 2013 at 8:00 a.m. and will end on November 15, 2013 at 6:30 p.m. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Clinical Neuroscience and Neurodegeneration Study Section, October 10, 2013, 08:00 a.m. to October 10, 2013, 06:00 p.m., National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD 20892 which was published in the
The meeting will start on December 13, 2013 at 9:00 a.m. and end December 13, 2013 at 6:00 p.m. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Skeletal Biology Structure and Regeneration Study Section, October 8, 2013, 8:00 a.m. to October 9, 2013, 5:30 p.m., Admiral Fell Inn, 888 South Broadway, Baltimore, MD 21231 which was published in the
The meeting will start on November 19, 2013 at 7:30 a.m. and will end on November 19, 2013 at 7:30 p.m. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Skeletal Muscle and Exercise Physiology Study Section, October 10, 2013, 8:00 a.m. to October 11, 2013, 5:00 p.m., Residence Inn Washington DC, 1199 Vermont Avenue NW., Washington, DC 20005 which was published in the
The meeting will be held at the Virginian Suites Arlington, 1500 Arlington Blvd., Arlington, VA 22209. The meeting will start on November 11, 2013 at 8:00 a.m. and end on November 12, 2013 at 1:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the National Institute on Drug Abuse Special Emphasis Panel, October 16, 2013, 08:00 a.m. to October 16, 2013, 05:00 p.m., National Institutes of Health, Neuroscience Center, 6001 Executive Boulevard, Rockville, MD 20852 which was published in the
The date, time and location of the meeting are changed to November 21, 2013, 9:00 a.m. to November 21, 2013, 6:00 p.m., Hyatt Regency Bethesda, One Bethesda Metro Center, 7400 Wisconsin Avenue, Bethesda, MD 20814. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Lung Injury, Repair, and Remodeling Study Section, October 7, 2013, 8:00 a.m. to October 7, 2013, 6:30 p.m., Hyatt Regency Bethesda, One Bethesda Metro Center, 7400 Wisconsin Avenue, Bethesda, MD 20814 which was published in the
The meeting will be held at the National Institutes of Health, 6701 Rockledge Dr., Bethesda, MD 20892. The meeting will start on November 01, 2013 at 9:00 a.m. and will end on November 03, 2013 at 5:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Infectious Diseases, Reproductive Health, Asthma and Pulmonary Conditions Study Section, October 7, 2013, 8:00 a.m. to October 8, 2013, 3:00 p.m., Hilton Old Town Alexandria, Alexandria, VA 22314 which was published in the
The meeting will be held at the National Institutes of Health, 6701 Rockledge Dr., Bethesda, MD 20892. The meeting will start on December 17, 2013 at 8:00 a.m. and end on December 18, 2013 at 5:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Center for Scientific Review Special Emphasis Panel, October 21, 2013, 7:30 a.m. to October 21, 2013, 6:00 p.m., Hilton Long Beach and Executive Center, 701 West Ocean Boulevard, Long Beach, CA 90831 which was published in the
The meeting will be held at the Embassy Suites at Chevy Chase Pavilion, 4300 Military Rd. NW., Washington, DC 20015. The meeting will start on December 13, 2013 at 7:30 a.m. and end on December 13, 2013 at 6:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Macromolecular Structure and Function B Study Section, October 17, 2013, 8:00 a.m. to October 17, 2013, 7:00 p.m., Amalfi Hotel, 20 West Kinzie Street, Chicago, IL 60654 which was published in the
The meeting will be held at the National Institutes of Health, 6701 Rockledge Dr., Bethesda, MD 20892. The meeting will start on December 04, 2013 at 9:30 a.m. and will end on December 04, 2013 at 7:30 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the National Institute of Biomedical Imaging and Bioengineering Special Emphasis Panel, October 10-11, 2013, 03:00 p.m.-06:00 p.m., National Institutes of Health, Two Democracy Plaza, Suite 920, 6707 Democracy Boulevard, Bethesda, MD 20892, which was published in the
The meeting notice is amended to change the date from October 10-11, 2013, to November 26, 2013 at 10:00 a.m. to 06:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the National Institute on Drug Abuse Special Emphasis Panel, October 17, 2013, 08:00 a.m. to October 17, 2013, 05:00 p.m., National Institutes of Health, Neuroscience Center, 6001 Executive Boulevard, Rockville, MD, 20852 which was published in the
The date, time and the location of the meeting are changed to November 22, 2013, 8:30 a.m. to November 22, 2013, 3:00 p.m., Hyatt Regency Bethesda, One Bethesda Metro Center, 7400 Wisconsin Avenue, Bethesda, MD 20814. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Adult Psychopathology and Disorders of Aging Study Section, October 17, 2013, 08:00 a.m. to October 18, 2013, 05:00 p.m., Crystal City Marriott, 1999 Jefferson Davis Highway, Arlington, VA 22202 which was published in the
The meeting will be held at the National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD 20892. The meeting will start on December 4, 2013 at 09:00 a.m. and end on December 5, 2013 at 03:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Center for Scientific Review Special Emphasis Panel, October 22, 2013, 9:00 a.m. to October 23, 2013, 6:00 p.m., National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD 20892 which was published in the
The meeting will start on December 10, 2013 and end on December 11, 2013. The meeting time and location remain the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Risk, Prevention and Intervention for Addictions Study Section, October 03, 2013, 08:00 a.m. to October 04, 2013, 05:30 p.m., Renaissance Mayflower Hotel, 1127 Connecticut Avenue NW., Washington, DC 20036 which was published in the
The meeting will be held on December 9, 2013, 8:00 a.m. to 7:00 p.m. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the National Institute on Drug Abuse Special Emphasis Panel, October 15, 2013, 11:00 a.m. to October 15, 2013, 2:00 p.m., Hilton Garden Inn Washington DC/Bethesda, 7301 Waverly Street, Bethesda, MD 21045 which was published in the
The date, time and location of the meeting are changed to November 13, 2013, 9:00 a.m. to November 13, 2013, 10:15 a.m., Hyatt Regency Bethesda, One Bethesda Metro Center, 7400 Wisconsin Avenue, Bethesda, MD 20814. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Integrative Nutrition and Metabolic Processes Study Section, October 10, 2013, 08:00 a.m. to October 10, 2013, 06:00 p.m., Doubletree Hotel Bethesda, (Formerly Holiday Inn Select), 8120 Wisconsin Avenue, Bethesda, MD 20814 which was published in the
The meeting will be held at the National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD 20892 on December 16, 2013, starting at 09:00 a.m. and ending at 07:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Cellular Aspects of Diabetes and Obesity Study Section, October 17, 2013, 08:00 a.m. to October 17, 2013, 05:00 p.m., Hilton Garden Inn Bethesda, 7301 Waverly Street, Bethesda, MD 20814 which was published in the
The meeting will be held at the National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD 20892 on December 13, 2013. The meeting will start at 9:00 a.m. and end at 5:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Neurobiology of Motivated Behavior Study Section, October 14, 2013, 08:00 a.m. to October 15, 2013, 01:00 p.m., Pier 5 Hotel, 711 Eastern Avenue, Baltimore, MD 21202 which was published in the
The meeting will start on December 2, 2013 at 8:00 a.m. and end on December 3, 2013 at 1:00 p.m. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Vector Biology Study Section, October 09, 2013, 8:30 a.m. to October 09, 2013, 06:00 p.m., The River Inn, 924 25th Street NW., Washington, DC 20037 which was published in the
The meeting will be held at National Institutes of Health, 6701 Rockledge Dr., Bethesda, MD 20892. The meeting will start on November 23, 2013 at 10:00 a.m. and end on November 23, 2013 at 6:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Hypersensitivity, Autoimmune, and Immune-mediated Diseases Study Section, October 3, 2013, 8:00 a.m. to October 4, 2013, 5:00 p.m., Crystal City Marriott, 1999 Jefferson Davis Highway, Arlington, VA 22202 which was published in the
The meeting will start on November 14, 2013 and end on November 15, 2013. The time and location remain the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Cognition and Perception Study Section, October 10, 2013, 8:00 a.m. to October 11, 2013, 5:00 p.m., Churchill Hotel, 1914 Connecticut Avenue NW., Washington, DC 20009 which was published in the
The meeting will be held at the Renaissance Washington, 999 Ninth St. NW., Washington, DC 20001. The meeting will start on December 5, 2013 at 8:30 a.m. and will end on December 6, 2013 at 5:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Genomics, Computational Biology and Technology Study Section, October 16, 2013, 8:30 a.m. to October 17, 2013, 1:00 p.m., Avenue Hotel Chicago, 160 E. Huron Street, Chicago, IL 60611 which was published in the
The meeting will start on December 18, 2013 at 8:30 a.m. and will end on December 19, 2013 at 3:00 p.m. The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Clinical and Integrative Diabetes and Obesity Study Section, October 10, 2013, 8:00 a.m. to October 10, 2013, 5:00 p.m., The Allerton Hotel, 701 North Michigan Avenue, Chicago, IL 60611 which was published in the
The meeting will be held at the National Institutes of Health, 6701 Rockledge Dr., Bethesda, MD 20892. The meeting will start on December 18, 2013 at 7:00 a.m. and will end on December 19, 2013 at 7:00 p.m. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Center for Scientific Review Special Emphasis Panel, October 22, 2013, 02:00 p.m. to October 22, 2013, 04:00 p.m., National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD 20892 which was published in the Federal Register on October 01, 2013, 78 FR 190 Pgs. 60294-60296.
The meeting will start on December 11, 2013 at 01:00 p.m. and end on December 11, 2013 at 3:00 p.m.
The meeting location remains the same. The meeting is closed to the public.
Notice is hereby given of a change in the meeting of the Cardiovascular Differentiation and Development Study Section, October 09, 2013, 08:00 a.m. to October 09, 2013, 06:00 p.m., Hyatt Regency Bethesda, One Bethesda Metro Center, 7400 Wisconsin Avenue, Bethesda, MD 20814 which was published in the
The meeting will be held on December 10, 2013 from 08:00 p.m. to 06:00 p.m. The meeting location remains the same. The meeting is closed to the public.
U.S. Customs and Border Protection, Department of Homeland Security (DHS).
Committee Management; Notice of Federal Advisory Committee Meeting.
The Advisory Committee on Commercial Operations of Customs and Border Protection (COAC) will meet on November 15, 2013, in Washington, DC. The meeting will be open to the public.
COAC will meet on Friday, November 15, from 1:00 p.m. to 5:00 p.m. EST. Please note that the meeting may close early if the committee has completed its business.
Feel free to share this information with other interested members of your organization or association.
Members of the public who are pre-registered and later require cancellation, please do so in advance of the meeting by accessing one (1) of the following links:
The meeting will be held at the U.S. International Trade Commission (USITC) in Main Hearing Room 101, 500 E Street SW., Washington, DC 20436. All visitors to the USITC Building must show a state-issued ID or Passport to proceed through the security checkpoint for admittance to the building.
For information on facilities or services for individuals with disabilities or to request special assistance at the
To facilitate public participation, we are inviting public comment on the issues to be considered by the committee prior to the formulation of recommendations as listed in the “Agenda” section below.
Comments must be submitted in writing no later than November 7, 2013, and must be identified by Docket No. USCBP-2013-0041, and may be submitted by one of the following methods:
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There will be multiple public comment periods held during the meeting on November 15, 2013. Speakers are requested to limit their comments to two (2) minutes or less to facilitate greater participation. Contact the individual listed below to register as a speaker. Please note that the public comment period for speakers may end before the time indicated on the schedule that is posted on the CBP Web page,
Ms. Wanda Tate, Office of Trade Relations, U.S. Customs and Border Protection, 1300 Pennsylvania Avenue NW., Room 3.5A, Washington, DC 20229; telephone 202-344-1440; facsimile 202-325-4290.
Notice of this meeting is given under the
The COAC will hear from the following project leaders and subcommittees on the topics listed below and then will review, deliberate, provide observations, and formulate recommendations on how to proceed on those topics:
1. The One U.S. Government at the Border Subcommittee: Review and discuss recommendations from the Food and Drug Administration (FDA) Working Group, review and discuss an update on the progress of the Environmental Protection Agency (EPA) Working Group, and review and discuss a case study regarding the Partner Government Agency—Message Set (PGA-MS).
2. The Global Supply Chain Subcommittee: Review and discuss recommendations regarding the Air Cargo Advance Screening (ACAS) pilot and address the next steps regarding land border issues in the area of Beyond the Border and 21st Century Initiatives.
3. The Trade Modernization Subcommittee: Review and discuss recommendations addressing the Automated Commercial Environment (ACE) Development and Deployment Schedule and recommendations of the Role of the Broker Work Group.
4. COAC Survey Team: Review and Discuss Preliminary Results of the COAC 2013 Annual Trade Efficiency Survey and discuss feedback on past COAC recommendations.
5. The Trusted Trader Subcommittee: Review and discuss the Customs-Trade Partnership Against Terrorism C-TPAT criteria for exporters.
6. The Trade Enforcement and Revenue Collection Subcommittee: Review and discuss the work completed to date on the Regulatory Audit Working Group's findings on the planned enhancements for the Focused Assessment process and the Intellectual Property Rights Working Group's effort to further evaluate the use of the Global Shipment Identification Number (GSIN) as a possible tool for use in Distribution Chain Management in Intellectual Property Rights Compliance.
7. The Export Subcommittee: Review and discuss subcommittee recommendations and the analysis of the 2013 COAC Export Survey Results.
Fish and Wildlife Service, Interior.
Notice of availability.
We, the U.S. Fish and Wildlife Service (Service), announce the availability of the Tualatin River National Wildlife Refuge (refuge) final comprehensive conservation plan (CCP). The CCP includes our finding of no significant impact (FONSI) for the associated environmental assessment (EA). In this final CCP, we describe how we will manage the refuge for the next 15 years.
You may view or request a printed or CD-ROM copy of the final CCP and FONSI by any of the following methods.
Erin Holmes, Project Leader, (503) 625-5944.
With this notice, we finalize the CCP process for the refuge. The Service began this process by publishing a notice of intent in the
The refuge encompasses approximately 2,217 acres in Oregon's northern Willamette Valley, with herbaceous and scrub-shrub wetlands, and wet prairie, oak savanna, woodland, mixed deciduous forest, riparian forest, riverine, and stream habitats.
We announce our decision and the availability of the FONSI for the final CCP in accordance with National Environmental Policy Act (NEPA) (40 CFR 1506.6(b)) requirements. We completed a thorough analysis of impacts on the human environment in the draft CCP/EA.
The National Wildlife Refuge System Administration Act of 1966 (16 U.S.C. 668dd-668ee) (Refuge Administration Act), as amended by the National Wildlife Refuge System Improvement Act of 1997, requires us to develop a CCP for each national wildlife refuge. The purpose for developing a CCP is to provide refuge managers with a 15-year plan for achieving refuge purposes and contributing toward the mission of the National Wildlife Refuge System (NWRS), consistent with sound principles of fish and wildlife management, conservation, legal mandates, and our policies. In addition to outlining broad management direction on conserving wildlife and their habitats, CCPs identify wildlife-dependent recreational opportunities available to the public, including opportunities for hunting, fishing, wildlife observation and photography, and environmental education and interpretation. We will review and update the CCP at least every 15 years in accordance with the Refuge Administration Act.
We identified three alternatives for refuge management in the draft CCP/EA, including Alternative 1, our no action alternative. We solicited public comments on the draft CCP/EA, and included a summary of the comments we received and our responses in the final CCP.
The final CCP includes detailed information about the refuge, our planning process, the issues we addressed, and Alternative 2, the management alternative we selected for implementation on the refuge. Under Alternative 2 we will balance our management of the refuge's competing management needs and issues. Brief descriptions of key management actions described in Alternative 2 follow:
We will combine the existing fragmented habitats into larger contiguous blocks of native habitat types, and restore relic or disappearing habitats.
Using hydrological modeling, and historic vegetation and soil information, we will restore and increase riparian forest acreage and mixed forest acreage over the next 15 years.
Restored forest habitats will advance our efforts to increase riparian corridor connectivity, and provide habitat for neotropical songbirds and other species.
Restored relic oak habitat acreage will increase to provide habitat for imperiled oak-dependent wildlife.
The acreage of managed wetland ponds will decrease to restore more natural wet prairie habitats to historic vegetation.
Scrub-shrub wetland acreage will increase.
Stream habitat will be restored to facilitate fish passage, and benefit other aquatic species and migratory and resident wildlife.
The refuge will expand public use opportunities including hunting and fishing.
On the Sherwood Unit, existing trails will remain the same, with an additional Environmental Education Off-Trail Study Area and a Nature Explore Area.
Additional photography blinds will be constructed to maximize the photography experience and minimize wildlife disturbances.
A youth waterfowl hunting program will be developed.
A hunt management plan will be developed in close coordination with the State, to determine the season, blind locations, and other details.
We will monitor and adjust the hunt program as needed to provide quality waterfowl hunting and healthy habitat.
We will develop a fishing program with an educational component on the River Overlook.
The CCP will guide us in managing and administering the refuge for the next 15 years. Alternative 2, as we described in the draft CCP, is the foundation for the final CCP. The draft and final CCP and related documents may be found on our Web site (see
Fish and Wildlife Service, Interior.
Notice.
We announce new deadlines for the public to submit input on several draft documents prepared in accordance with the National Environmental Policy Act. We are taking this action in regard to draft documents and scoping periods that were open for comment during the recent lapse in Federal appropriations. To ensure that we receive the best possible input to guide our decisionmaking, we want to provide the public adequate time to review and comment on the draft documents.
See
See each original
See the contact information in the original
We, the U.S. Fish and Wildlife Service (Service), published notices in the
To ensure compliance with our responsibilities under NEPA and to provide the public increased access to Service sources of information, we are allowing additional time for public
For information about these draft documents and related issues, contact the person listed in the relevant notice under
We issue this notice under the authority of the National Environmental Policy Act, as amended (42 U.S.C. 4321 et seq.).
Fish and Wildlife Service, Interior.
Notice of issuance of permits.
The permit issuance dates are under
We, the U.S. Fish and Wildlife Service, have issued the following permits to conduct certain activities with endangered species under the authority of the Endangered Species Act, as amended (Act). With some exceptions, the Act prohibits activities with listed species unless a Federal permit is issued that allows such activity.
Mr. Daniel Marquez, U.S. Fish and Wildlife Service, Region 8, 2800 Cottage Way, Room W-2606, Sacramento, CA 95825; 760-431-9440 (telephone); or
We have issued the following permits in response to recovery permit applications we received under the authority of section 10 of the Act, as amended (16 U.S.C. 1531
Documents and other information submitted with these applications are available for review, subject to the requirements of the Privacy Act and Freedom of Information Act, by any party who submits a written request for a copy of such documents to Daniel Marquez (see
The authority for this notice is the Endangered Species Act of 1973, as amended (16 U.S.C. 1531
U.S. Geological Survey.
Notice of meeting.
Pursuant to Public Law 106-503, the Scientific Earthquake Studies Advisory Committee (SESAC) will hold its next meeting at Stanford University, in Palo Alto, California. The Committee is comprised of members from academia, industry, and State government. The Committee shall advise the Director of the U.S. Geological Survey (USGS) on matters relating to the USGS's participation in the National Earthquake Hazards Reduction Program.
The Committee will receive reports on the status of activities of the Program and progress toward Program goals and objectives. The Committee will assess this information and provide guidance on the future undertakings and direction of the Earthquake Hazards Program. Focus topics for this meeting include budget sequestration, rock mechanics research, induced seismicity, earthquake early warning and national earthquake hazard mapping.
Meetings of the Scientific Earthquake Studies Advisory Committee are open to the public.
November 6-7th, 2013, commencing at 8:30 a.m. on the first day and adjourning at 1:00 p.m. on November 7, 2013.
U.S. Geological Survey, Interior.
Notice of meeting.
Pursuant to Public Law 96-472, the National Earthquake Prediction Evaluation Council (NEPEC) will hold a one-and-a-half-day meeting on November 4 and 5, 2013, at the U.S. Geological Survey (USGS) in Menlo Park, California. The Council is comprised of members from academia and the Federal Government. The Council shall advise the Director of the U.S. Geological Survey on proposed earthquake predictions, on the completeness and scientific validity of the available data related to earthquake predictions, and on related matters as assigned by the Director. Additional information about the Council may be found at:
At the meeting, the Council will receive several briefings on the history and current state of scientific investigations of earthquake processes in and around the San Andreas fault near the town of Parkfield in central California, and will be asked to advise the USGS on priorities for instrumentation and scientific investigations in the future. The Council will also hear updates on past topics of discussion, including work with social and behavioral scientists on improving hazard and risk messages; development of improved methods for calculation of short-term aftershock probabilities; USGS collaborative work with the Collaboratory for Study of Earthquake Predictability (CSEP); status of an updated Uniform California Earthquake Rupture Forecast (UCERF3); and on the delivery of near-real-time earthquake information by the National Earthquake Information Center (NEIC).
A draft meeting agenda is available from the Executive Secretary on request (contact information below), and will be posted to the Web site (above) when finalized. In order to ensure sufficient seating and hand-outs, it is requested that visitors pre-register by contacting the Executive Secretary by November 1. Members of the public wishing to make a statement to the Council should provide notice of that intention by November 1 so that time may be allotted in the agenda.
The meeting will be held in Building 3 of the USGS campus at 345 Middlefield Road, Menlo Park, California. The meeting will commence in the early afternoon of Monday, November 4, 2013, and continue the following day, November 5, 2013, beginning at 9:00 a.m. and adjourning at or before 4:00 p.m. Times are approximate. Guests are encouraged to contact the Executive Secretary for a copy of the agenda and instructions for parking and locating the meeting room.
Bureau of Land Management, Interior.
Call for nominations.
The Bureau of Land Management (BLM) is soliciting nominations from the public to fill positions on the Carrizo Plain National Monument Advisory Committee (MAC). MAC members provide advice and recommendations to the BLM on the management of public lands in the Carrizo Plain National Monument.
Nominations should be sent to the Monument Manager, Bureau of Land Management, Bakersfield Field Office, 3801 Pegasus Drive, Bakersfield, CA 93308.
Johna Hurl, Monument Manager, Bakersfield Field Office, 3801 Pegasus Drive, Bakersfield, CA 93308, 661-391-6093,
The MAC provides representative citizen counsel and advice to the Secretary of the Interior through the BLM with respect to the revision and implementation of the comprehensive plan for the Carrizo Plain National Monument.
The MAC consists of 10 members:
(1) A member of, or nominated by, the San Luis Obispo County Board of Supervisors;
(2) A member of, or nominated by, the Kern County Board of Supervisors;
(3) A member of, or nominated by, the Carrizo Native American Advisory Council;
(4) A member of, or nominated by, the Central California Resource Advisory Council;
(5) A member representing individuals or companies authorized to graze livestock within the Monument; and
(6) Five members with recognized backgrounds reflecting:
(a) The purposes for which the Monument was established; and
(b) The interests of other stakeholders, including the general public, who are affected by or interested in the planning and management of the Monument.
Terms of three present MAC members (two public-at-large and one San Luis Obispo County Board of Supervisors) expire on November 15, 2013. Individuals may nominate themselves or others. Nominees must be residents of the counties or neighboring county in which the MAC has jurisdiction. The BLM will evaluate nominees based on their education, training, and experience and their knowledge of the geographical resource. The following must accompany nominations received in this call for nominations:
• Letters of reference from represented interests or organizations;
• A completed background information nomination form; and
• Any other information that speaks to the nominee's qualifications.
Nominations will be accepted for a 45-day period beginning the date this notice is published.
43 CFR 1784.4-1.
Bureau of Land Management, Interior.
Notice of Filing of Plats of Survey.
The plats of survey described below are scheduled to be officially filed in the New Mexico State Office, Bureau of Land Management, Santa Fe, New Mexico, thirty (30) calendar days from the date of this publication.
These plats will be available for inspection in the New Mexico State Office, Bureau of Land Management, 301 Dinosaur Trail, Santa Fe, New Mexico. Copies may be obtained from this office upon payment. Contact Marcella Montoya at 505-954-2097, or by email at
The plat, representing the dependent resurvey and survey in Township 22 North, Range 9 East, of the Indian Meridian, accepted May 15, 2013, for Group 210 OK.
The Supplemental Plat, representing the dependent resurvey and survey in Township 5 North, Range 7 East, of the Indian Meridian, accepted August 5, 2013, OK.
The plat, in three sheets, representing the dependent resurvey and survey in Township 29 North, Range 23 East, of the Indian Meridian, accepted September 24, 2013, for Group 219 OK.
The plat, representing the dependent resurvey and survey in Township 21 North, Range 9 East, of the New Mexico Principal Meridian, accepted July 18, 2013, for Group 1151 NM.
The plat, representing the dependent resurvey and survey in Township 6 North, Range 15 West, of the New Mexico Principal Meridian, accepted May 28 18, 2013, for Group 1141 NM.
The plat, representing the dependent resurvey and survey in Township 12 North, Range 4 East, of the New Mexico Principal Meridian, accepted September 16, 2013, for Group 1134 NM.
The plat, in two sheets, representing the dependent resurvey and survey in Township 17 South, Range 16 West, of the New Mexico Principal Meridian NM, accepted September 24, 2013, for Group 1146 NM.
The Supplemental Plat, representing the dependent resurvey and survey in Township 23 South, Range 18 West, of the New Mexico Principal Meridian, accepted August 7, 2013 NM.
The Supplemental Plat, representing the dependent resurvey and survey in Township 23 South, Range 19 West, of the New Mexico Principal Meridian, accepted August 7, 2013 NM.
These plats are scheduled for official filing 30 days from the notice of publication in the
A plat will not be officially filed until the day after all protests have been dismissed and become final or appeals from the dismissal affirmed.
A person or party who wishes to protest against any of these surveys must file a written protest with the Bureau of Land Management New Mexico State Director stating that they wish to protest.
A statement of reasons for a protest may be filed with the Notice of Protest to the State Director or the statement of reasons must be filed with the State Director within thirty (30) days after the protest is filed.
Bureau of Land Management, Interior.
Correction.
This notice corrects the date that the Bureau of Land Management will open sealed bids for this public land sale. The original notice, which published on September 25, 2013 (78 FR 59055), incorrectly stated the date.
On page 59055, column 2, line 4 below the chart, which reads, “November 25, 2013,” is hereby corrected to read, “November 26, 2013.”
Bureau of Reclamation, Interior.
Notice.
The Bureau of Reclamation intends to prepare an Environmental Impact Statement (EIS) for the Keechelus Reservoir-to-Kachess Reservoir Conveyance and the Kachess Reservoir Inactive Storage projects. The Washington State Department of Ecology will be a joint lead agency with the Bureau of Reclamation in the preparation of this EIS. The Bureau of Reclamation is requesting public comment and agency input to identify significant issues or other alternatives to be addressed in the EIS.
Submit written comments on the scope of the EIS on or before December 16, 2013.
Two scoping meetings, combined with open houses each day, will be held on the following dates and times:
• November 20, 2013, 1:30 p.m. to 3:30 p.m., and 5:00 p.m. to 7:00 p.m., Yakima, WA.
• November 21, 2013, 1:30 p.m. to 3:30 p.m., and 5:00 p.m. to 7:00 p.m., Cle Elum, WA.
Send written scoping comments, requests to be added to the mailing list, or requests for sign language interpretation for the hearing impaired or other special assistance needs to Ms. Candace McKinley, Environmental Program Manager, Bureau of Reclamation, Columbia-Cascades Area Office, 1917 Marsh Road, Yakima, WA 98901; or email
The scoping meetings and open houses will be located at:
• Yakima—Yakima Area Arboretum, 1401 Arboretum Way, Yakima, WA 98901.
• Cle Elum—U.S. Forest Service (Cle Elum Ranger District Conference Room), 803 W 2nd Street, Cle Elum, WA 98922.
Ms. Candace McKinley, Bureau of Reclamation, Columbia-Cascades Area Office, 1917 Marsh Road, Yakima, WA 98901; telephone (509) 575-5848, ext. 232; facsimile (509) 454-5650; email
The Bureau of Reclamation (Reclamation) is issuing this notice pursuant to the National Environmental Policy Act of 1969, as amended (NEPA), 42 U.S.C. 4321
On July 9, 2013, the Record of Decision (ROD) for the Final Programmatic EIS (PEIS) for the Yakima River Basin Integrated Water Resource Management Plan (Integrated Plan) was signed. In the ROD, the Reclamation selected the Integrated Plan Alternative for implementation. The Integrated Plan Alternative is comprised of seven elements which were considered in the PEIS:
1. Reservoir Fish Passage;
2. Structural and Operational Changes;
3. Surface Water Storage;
4. Groundwater Storage;
5. Habitat/Watershed Protection and Enhancement;
6. Enhanced Water Conservation; and
7. Market Reallocation of Water Resources.
As described in the PEIS, Reclamation and the Washington State Department of Ecology (Ecology) will complete project-level, site-specific environmental review for actions within the Integrated Plan once the agencies are ready to move forward each action or groups of actions. For instance, with regard to the present NOI, Reclamation and Ecology have determined that it is appropriate to initiate the environmental review process with regard to the Keechelus Reservoir-to-Kachess Reservoir Conveyance and Kachess Reservoir Inactive Storage projects.
These actions were previously evaluated at a programmatic level of analysis in the Integrated Plan PEIS (see chapters 2 through 5 of the PEIS available at:
The proposed, site specific actions to be evaluated in the Keechelus Reservoir-to-Kachess Reservoir Conveyance and Kachess Reservoir Inactive Storage EIS are:
1. Transfer water through a tunnel from the Keechelus watershed to Kachess Reservoir. Two alternatives have been identified for a tunnel to convey water from Keechelus watershed to Kachess Reservoir. One would include construction of a new outlet works at the north end of Keechelus Dam connecting to a 10-12 foot-diameter, 3.7-mile-long, gravity flow tunnel. The other would include construction of a diversion structure on the Yakima River about 8,000 feet downstream of Keechelus Dam, connecting to a 10-12 foot-diameter, 3.2-mile-long, gravity flow tunnel. Both tunnel alternatives would discharge into Kachess Reservoir through a new structure located on the west shore; and
2. Release an additional 200,000 acre-feet of water from Kachess Reservoir during severe droughts by accessing inactive storage through additional outlet facilities. A substantial volume of water stored in Kachess Reservoir is currently inaccessible because it is below the elevation of the outlet works. This is referred to as inactive storage. An alternative being considered to access the inactive storage in Kachess Reservoir includes a new outlet works at a lower elevation in the reservoir connected by a tunnel to a pump station that would discharge to the Kachess River.
The objectives of these proposed actions are to increase the total water supply available from the Keechelus watershed for irrigation and instream flow, provide additional water for
At this time, there are no known Indian Trust Assets or environmental justice issues associated with the Proposed Actions.
If special assistance is required to participate in the public scoping and open house meetings, please contact Ms. Candace McKinley, Bureau of Reclamation, Columbia-Cascades Area Office, 1917 Marsh Road, Yakima, WA 98901; telephone (509) 575-5848, ext. 232; facsimile (509) 454-5650; email
Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time. While you may ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.
Bureau of Reclamation, Interior.
Notice.
The Bureau of Reclamation intends to prepare an Environmental Impact Statement (EIS) on the Cle Elum Reservoir Pool Raise project. The Washington State Department of Ecology will be a joint lead agency with the Bureau of Reclamation in the preparation of this EIS, which also will be used to comply with requirements of the Washington State Environmental Policy Act (SEPA). The Bureau of Reclamation is requesting public comment and agency input to identify significant issues or other alternatives to be addressed in the EIS.
Submit written comments on the scope of the environmental impact statement on or before December 16, 2013.
Two scoping meetings, combined with open houses each day, will be held on the following dates and times:
• November 20, 2013, 1:30 p.m. to 3:30 p.m., and 5:00 p.m. to 7:00 p.m., Yakima, WA.
• November 21, 2013, 1:30 p.m. to 3:30 p.m., and 5:00 p.m. to 7:00 p.m., Cle Elum, WA.
Send written scoping comments, requests to be added to the mailing list, or requests for sign language interpretation for the hearing impaired or other special assistance needs to Ms. Candace McKinley, Environmental Program Manager, Bureau of Reclamation, Columbia-Cascades Area Office, 1917 Marsh Road, Yakima, WA 98901; or email
The scoping meetings and open houses will be located at:
• Yakima—Yakima Area Arboretum, 1401 Arboretum Way, Yakima, WA 98901.
• Cle Elum—U.S. Forest Service (Cle Elum Ranger District Conference Room), 803 W 2nd Street, Cle Elum, WA 98922.
Ms. Candace McKinley, Bureau of Reclamation, Columbia-Cascades Area Office, 1917 Marsh Road, Yakima, WA 98901; telephone (509) 575-5848, ext. 232; facsimile (509) 454-5650; email
The Bureau of Reclamation (Reclamation) is issuing this notice pursuant to the National Environmental Policy Act of 1969, as amended (NEPA), 42 U.S.C. 4321
On July 9, 2013, the Record of Decision (ROD) for the Final Programmatic EIS (PEIS) for the Yakima River Basin Integrated Water Resource Management Plan (Integrated Plan) was signed. In the ROD, the Reclamation selected the Integrated Plan Alternative for implementation. The Integrated Plan Alternative is comprised of seven elements which were considered in the PEIS:
1. Reservoir Fish Passage;
2. Structural and Operational Changes;
3. Surface Water Storage;
4. Groundwater Storage;
5. Habitat/Watershed Protection and Enhancement;
6. Enhanced Water Conservation; and
7. Water Market Reallocation of Water Resources.
As described in the PEIS, the Reclamation and the Washington State Department of Ecology (Ecology) will complete project-level, site-specific environmental review for actions within the Integrated Plan once the agencies are ready to move forward each action or groups of actions. Reclamation and Ecology have determined that it is appropriate to initiate the environmental review process with regard to the Cle Elum Reservoir Pool Raise.
This action was previously evaluated at a programmatic level of analysis in
The proposed action to be evaluated in the Cle Elum Reservoir Pool Raise EIS is to modify the radial gates at Cle Elum Dam to provide an additional 14,600 acre-feet of storage capacity. This modification would raise the pool level by approximately 3 feet. The objective of this action is to use the additional water stored to provide increased seasonal releases from Cle Elum Reservoir to improve streamflows for fish. The Cle Elum Pool Raise Project is authorized in Yakima River Basin Water Enhancement Project (Sec. 1206, Pub. L. 103-43).
At this time, there are no known Indian Trust Assets or environmental justice issues associated with the proposed action.
If special assistance is required to participate in the public scoping and open house meetings, please contact Ms. Candace McKinley, Bureau of Reclamation, Columbia-Cascades Area Office, 1917 Marsh Road, Yakima, WA 98901; telephone (509) 575-5848, ext. 232; facsimile (509) 454-5650; email
Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time. While you may ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.
U.S. International Trade Commission.
Notice.
Notice is hereby given that the U.S. International Trade Commission has determined to review in the entirety the final initial determination (“ID”) issued by the presiding administrative law judge (“ALJ”) on August 2, 2013, finding a violation of section 337 of the Tariff Act of 1930, 19 U.S.C. 1337, in this investigation.
Sidney A. Rosenzweig, Office of the General Counsel, U.S. International Trade Commission, 500 E Street SW., Washington, DC 20436, telephone (202) 708-2532. Copies of non-confidential documents filed in connection with this investigation are or will be available for inspection during official business hours (8:45 a.m. to 5:15 p.m.) in the Office of the Secretary, U.S. International Trade Commission, 500 E Street SW., Washington, DC 20436, telephone (202) 205-2000. General information concerning the Commission may also be obtained by accessing its Internet server at
The Commission instituted this investigation on May 2, 2012, based on a complaint filed by Technology Properties Limited, LLC (“TPL”) of Cupertino, California. 77 FR 26041 (May 2, 2012). The complaint alleges violations of section 337 of the Tariff Act of 1930, as amended, 19 U.S.C. 1337, by reason of infringement of certain claims of U.S. Patent Nos. 6,976,623 (“the ’623 patent”), 7,162,549 (“the ’549 patent”), 7,295,443 (“the ’443 patent”), 7,522,424 (“the ’424 patent”), 6,438,638 (“the ’638 patent”), and 7,719,847 (“the ’847 patent”). The complaint further alleges the existence of a domestic industry. The notice of investigation named twenty-one respondents, some of whom have since settled from the investigation. As a result of these settlements, the '638 patent is no longer at issue, as it has not been asserted against the remaining respondents. The remaining respondents are Acer Inc. of New Taipei City, Taiwan (“Acer”); Canon Inc. of Toyko, Japan; Hewlett-Packard Company of Palo Alto, California (“HP”); HiTi Digital, Inc. of New Taipei City, Taiwan; Kingston Technology Company, Inc. of Fountain Valley, California (“Kingston”); Newegg, Inc. and Rosewill Inc., both of City of Industry, California (“Newegg/Rosewill”); and Seiko Epson Corporation of Nagano, Japan.
On October 4, 2012, the ALJ issued a
The ALJ found that the respondents had not shown that any of the asserted patent claims are invalid. However, the ALJ found that TPL demonstrated infringement of the ’623 patent, and not the other patents. With respect to the ’623 patent, the ALJ found that TPL demonstrated direct infringement of the asserted apparatus claims (claims 1-4 and 9-12). Accordingly, the ALJ found a violation of section 337 by Acer, Kingston and Newegg/Rosewill (collectively, “the ’623 respondents”) as to these apparatus claims of the “623 patent.
On August 19, 2013, the parties filed petitions for review. TPL's petition challenges the ALJ's noninfringement determinations for the ’443, ’424, and ’847 patents. TPL did not petition for review of the ALJ's noninfringement determination for the ’549 patent. The ’623 respondents challenge one of the ALJ's claim constructions, and independently challenge the ALJ's finding that the asserted claims of the '623 patent are not anticipated by, or obvious in view of, three pieces of prior art. The ’623 respondents also challenge the ALJ's finding that TPL demonstrated the existence of a domestic industry, and subscribe to the analysis presented by the respondents against whom the ’623 patent was not asserted.
The respondents against whom the ’623 patent was not asserted contingently challenge TPL's evidence of expenditures, as well as the nexus between those expenditures and the asserted patents, for purposes of showing a domestic industry under section 337(a)(3)(C). They also argue that “[t]here is no evidence that TPL's licensees' efforts relate to ’an article protected by' any of the asserted patents.” Resp'ts' Pet. 42, 54-56. The respondents against whom the ’623 patent was not asserted also argue that the four patents asserted against them are invalid as anticipated or obvious in view of the prior art. They also make additional non-infringement arguments for the three patents asserted against them for which TPL has petitioned for review (the ’443, ’424 and ’847 patents).
Respondent HP filed a short petition for review on its own behalf. HP argues for a narrow interpretation of articles “protected by” an asserted patent. HP Pet. 5.
On August 27, 2013, the parties filed responses to each other's petitions.
Having examined the record of this investigation, including the ALJ's final ID, the petitions for review, and the responses thereto, the Commission has determined to review the ID in its entirety.
In connection with the Commission's review, the parties are asked to brief only the issues enumerated below.
(1) Discuss, in light of the statutory language, legislative history, the Commission's prior decisions, and relevant court decisions, including
(2) Discuss the construction of “accessible in parallel” in view of the prosecution history of the ’623 patent (including the Examiner's Statement of Reasons for Allowance,
(3) Comment on whether the respondents' invalidity evidence and analysis as to the Pro II system, the Uno Mas article, the Kaneshiro patent, and the '928 Publication, and TPL's evidence and analysis as to the technical prong of the domestic industry requirement, were undisputed. Please cite all evidence in the record that supports your position.
(4) Discuss whether TPL demonstrated that the products accused of infringing the '443, '424, and '847 patents receive or interface with SD cards that operate in a four-bit-bus mode, and if so, whether the accused products infringe the asserted claims.
(5) If the Commission were to find that the accused products infringe the '443, '424, and '847 patents, discuss whether the SD specification invalidates the asserted claims of those patents.
In connection with the final disposition of this investigation, the Commission may (1) issue an order that could result in the exclusion of the subject articles from entry into the United States, and/or (2) issue one or more cease and desist orders that could result in the respondent(s) being required to cease and desist from engaging in unfair acts in the importation and sale of such articles. Accordingly, the Commission is interested in receiving written submissions that address the form of remedy, if any, that should be ordered. If a party seeks exclusion of an article from entry into the United States for purposes other than entry for consumption, the party should so indicate and provide information establishing that activities involving other types of entry either are adversely affecting it or likely to do so. For background, see
If the Commission contemplates some form of remedy, it must consider the effects of that remedy upon the public interest. The factors the Commission will consider include the effect that an exclusion order and/or cease and desist orders would have on (1) the public health and welfare, (2) competitive conditions in the U.S. economy, (3) U.S. production of articles that are like or directly competitive with those that are subject to investigation, and (4) U.S. consumers. The Commission is therefore interested in receiving written submissions that address the aforementioned public interest factors in the context of this investigation.
If the Commission orders some form of remedy, the U.S. Trade Representative, as delegated by the President, has 60 days to approve or disapprove the Commission's action.
Persons filing written submissions must file the original document electronically on or before the deadlines stated above and submit 8 true paper copies to the Office of the Secretary by noon the next day pursuant to section 210.4(f) of the Commission's Rules of Practice and Procedure (19 CFR
Any person desiring to submit a document to the Commission in confidence must request confidential treatment. All such requests should be directed to the Secretary to the Commission and must include a full statement of the reasons why the Commission should grant such treatment.
The authority for the Commission's determination is contained in section 337 of the Tariff Act of 1930, as amended (19 U.S.C. 1337), and in sections 210.42-46 of the Commission's Rules of Practice and Procedure (19 CFR 210.42-46).
By order of the Commission.
60-Day Notice.
The Department of Justice (DOJ) Office of Community Oriented Policing Services (COPS) will be submitting the following information collection request to the Office of Management and Budget (OMB) for review and approval in accordance with the Paperwork Reduction Act of 1995. The revision of a previously approved information collection is published to obtain comments from the public and affected agencies.
The purpose of this notice is to allow for 60 days for public comment until [insert the date 60 days from the date this notice is published in the
If you have comments, especially on the estimated public burden or associated response time, suggestions, or need a copy of the proposed information collection instrument with instructions or additional information, please contact Ashley Hoornstra, Department of Justice Office of Community Oriented Policing Services, 145 N Street NE., Washington, DC 20530.
Written comments and suggestions from the public and affected agencies concerning the proposed collection of information are encouraged. Your comments should address one or more of the following four points:
(1)
(2)
(3)
(4)
An estimate of the total number of respondents and the amount of time estimated for an average respondent to respond/reply:
It is estimated that approximately 9428 annual, quarterly, and final report respondents can complete the report in an average of 25 minutes.
(5)
If additional information is required contact: Jerri Murray, Department Clearance Officer, United States Department of Justice, Justice Management Division, Policy and Planning Staff, Two Constitution Square, 145 N Street NE., Room 1407B, Washington, DC 20530.
Notice.
The Department of Labor (DOL) is submitting the Office of Workers' Compensation Programs (OWCP) sponsored information collection request (ICR) revision titled, “Notice of Law Enforcement Officer's Injury or Occupational Disease and Notice of Law Enforcement Officer's Death,” to the Office of Management and Budget (OMB) for review and approval for use in accordance with the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501 et seq.).
Submit comments on or before November 29, 2013.
A copy of this ICR with applicable supporting documentation; including a description of the likely respondents, proposed frequency of response, and estimated total burden may be obtained free of charge from the RegInfo.gov Web site at
Submit comments about this request to the Office of Information and Regulatory Affairs, Attn: OMB Desk Officer for DOL-OWCP, Office of Management and Budget, Room 10235, 725 17th Street NW., Washington, DC 20503, Fax: 202-395-6881 (this is not a toll-free number), email:
Michel Smyth by telephone at 202-693-4129 (this is not a toll-free number) or by email at
44 U.S.C. 3507(a)(1)(D).
As appropriate, a respondent files a Notice of Law Enforcement Officer's Injury or Occupational Disease, Form CA-721, or Notice of Law Enforcement Officer's Death, Form (CA-722), when seeking Federal Employees' Compensation Act (5 U.S.C. 8191 et seq.) benefits for a non-Federal law enforcement officer's injury, occupational illness, or death. The forms provide the OWCP with basic information needed to process a claim made for injury, illness, or death. This ICR has been classified as a revision, because—in accordance with Department of the Treasury requirements for all Federal benefits payments to be made electronically—Forms CA-721 and CA-722 have been changed to include space and instructions for claimants to provide direct deposit information. In addition, rather than requesting the claimant's signature, Form CA-722 has been revised to request the signature of the person filing the claim. Both forms have also been revised to include an accommodation statement informing claimants with mental or physical limitations to contact the OWCP, Division of Federal Employees' Compensation if they need further assistance with the claims process.
This information collection is subject to the PRA. A Federal agency generally cannot conduct or sponsor a collection of information, and the public is generally not required to respond to an information collection, unless it is approved by the OMB under the PRA and displays a currently valid OMB Control Number. In addition, notwithstanding any other provisions of law, no person shall generally be subject to penalty for failing to comply with a collection of information that does not display a valid Control Number.
Interested parties are encouraged to send comments to the OMB, Office of Information and Regulatory Affairs at the address shown in the
• Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
• Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
• Enhance the quality, utility, and clarity of the information to be collected; and
• Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
Notice.
The Department of Labor (DOL) is submitting the Employee Benefits Security Administration (EBSA) sponsored information collection request (ICR) titled, “Disclosures for Participant Directed Individual Account Plans,” to the Office of Management and Budget (OMB) for review and approval for continued use, without change, in accordance with the Paperwork Reduction Act (PRA) of 1995, 44 U.S.C. 3501 et seq.
Submit comments on or before November 29, 2013.
A copy of this ICR with applicable supporting documentation; including a description of the likely respondents, proposed frequency of response, and estimated total burden may be obtained free of charge from the RegInfo.gov Web site at
Submit comments about this request to the Office of Information and Regulatory Affairs, Attn: OMB Desk Officer for DOL-EBSA, Office of Management and Budget, Room 10235, 725 17th Street NW., Washington, DC 20503, Fax: 202-395-6881 (this is not a toll-free number), email:
Contact Michel Smyth by telephone at 202-693-4129 (this is not a toll-free number) or by email at
44 U.S.C. 3507(a)(1)(D).
Employee Retirement Income Security Act of 1974 section 404(c), 29 U.S.C. 1104(c), provides that, if an individual account pension plan permits a participant or beneficiary to exercise control over assets in his or her account and the participant or beneficiary in fact exercises such control (as determined under DOL regulations), the participant or beneficiary shall not be deemed to be a fiduciary by such exercise of control and no person otherwise a fiduciary to the plan shall be liable for any loss or breach that results solely from this exercise of control. Regulations 29 CFR 2550.404a-5 provides that, when a plan allocates investment responsibilities to participants or beneficiaries, the plan administrator must take action to ensure they are provided with sufficient information regarding the plan and its investment options, including fee and expense information, to make informed decisions with regard to the management of their individual accounts; therefore, the regulation requires a plan administrator to provide each participant or beneficiary with certain plan-related information and investment-related information.
This disclosure requirement is an information collection subject to the PRA. A Federal agency generally cannot conduct or sponsor a collection of information, and the public is generally not required to respond to an information collection, unless it is approved by the OMB under the PRA and displays a currently valid OMB Control Number. In addition, notwithstanding any other provisions of law, no person shall generally be subject to penalty for failing to comply with a collection of information that does not display a valid Control Number. See 5 CFR 1320.5(a) and 1320.6. The DOL obtains OMB approval for this information collection under Control Number 1210-0090.
OMB authorization for an ICR cannot be for more than three (3) years without renewal, and the current approval for this collection is scheduled to expire on October 31, 2013. The DOL seeks to extend PRA authorization for this information collection for three (3) years, without any change to existing requirements. The DOL also notes that existing information collection requirements submitted to the OMB receive a month-to-month extension while they undergo review. For additional substantive information about this ICR, see the related notice published in the
Interested parties are encouraged to send comments to the OMB, Office of Information and Regulatory Affairs at the address shown in the
• Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
• Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
• Enhance the quality, utility, and clarity of the information to be collected; and
• Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
Notice.
The Department of Labor (DOL) is submitting the Employment and Training Administration (ETA) sponsored information collection request (ICR) revision titled, “Attestations by Employers Using Alien Crewmembers for Longshore Activities in U.S. Ports,” to the Office of Management and Budget (OMB) for review and approval for use in accordance with the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501 et seq.).
Submit comments on or before November 29, 2013.
A copy of this ICR with applicable supporting documentation; including a description of the likely respondents, proposed frequency of response, and estimated total burden may be obtained free of charge from the RegInfo.gov Web site at
Submit comments about this request to the Office of Information and Regulatory Affairs, Attn: OMB Desk Officer for DOL-ETA, Office of Management and Budget, Room 10235, 725 17th Street NW., Washington, DC 20503, Fax: 202-395-6881 (this is not a toll-free number), email:
Contact Michel Smyth by telephone at 202-693-4129 (this is not a toll-free number) or by email at
44 U.S.C. 3507(a)(1)(D).
This ICR seeks OMB approval for revisions to the
This ICR has been classified as a revision, because the DOL is merging two Control Numbers, which will simplify the process for both the stakeholder community interested in these collections and the Federal staff reviewing and enforcing the attestations. Control Number 1205-0352 will survive after the merger. The DOL is also proposing changes to the layout of the forms for ease of review and completion. Finally, the DOL proposes to add a few new collection fields that will more accurately capture employer and job-related information. The update of the forms will, for example, reflect current communications methods by requesting email addresses rather than fax numbers.
This information collection is subject to the PRA. A Federal agency generally cannot conduct or sponsor a collection of information, and the public is generally not required to respond to an information collection, unless it is approved by the OMB under the PRA and displays a currently valid OMB Control Number. In addition, notwithstanding any other provisions of law, no person shall generally be subject to penalty for failing to comply with a collection of information that does not display a valid Control Number.
Interested parties are encouraged to send comments to the OMB, Office of Information and Regulatory Affairs at the address shown in the
• Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
• Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
• Enhance the quality, utility, and clarity of the information to be collected; and
• Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
Occupational Safety and Health Administration (OSHA), Labor.
Request for public comments.
OSHA solicits public comments concerning its proposal to extend OMB approval of the information collection requirement contained in the Aerial Lifts Standard in Construction (29 CFR 1926.453). Employers who modify an aerial lift for uses other than those provided by the manufacturer must obtain a certificate from the manufacturer or equivalent entity certifying that the modification is in conformance with applicable American National Standards Institute (ANSI) standards and that this Standard, and the equipment is as safe as it was prior to the modification.
Comments must be submitted (postmarked, sent, or received) by December 30, 2013.
Theda Kenney or Todd Owen, Directorate of Standards and Guidance, OSHA, U.S. Department of Labor, Room N-3468, 200 Constitution Avenue NW., Washington, DC 20210; telephone (202) 693-2222.
The Department of Labor, as part of its continuing effort to reduce paperwork and respondent (
The certification requirement specified in the Aerial Lifts Standard demonstrates that the manufacturer or an equally-qualified entity has assessed a modified aerial lift and found that it was safe for use by, or near, workers, and that it would provide workers with a level of protection at least equivalent to the protection afforded by the lift prior to modification. OSHA is requesting an adjustment increase in burden hour of 7 hours, resulting from an increase in the number of field modified lifts from 1,025 to 1,953; and an increase in the percentage of construction employers likely to be inspected from 6% to 6.6%.
OSHA has a particular interest in comments on the following issues:
• Whether the proposed information collection requirements are necessary for the proper performance of the Agency's functions, including whether the information is useful;
• The accuracy of OSHA's estimate of the burden (time and costs) of the information collection requirements, including the validity of the methodology and assumptions used;
• The quality, utility, and clarity of the information collected; and
• Ways to minimize the burden on employers who must comply; for example, by using automated or other technological information collection and transmission techniques.
You may submit comments in response to this document as follows: (1) Electronically at
Because of security procedures, the use of regular mail may cause a significant delay in the receipt of comments. For information about security procedures concerning the delivery of materials by hand, express delivery, messenger, or courier service, please contact the OSHA Docket Office at (202) 693-2350, (TTY (877) 889-5627).
Comments and submissions are posted without change at
David Michaels, PhD., MPH, Assistant Secretary of Labor for Occupational Safety and Health, directed the preparation of this notice. The authority for this notice is the Paperwork Reduction Act of 1995 (44 U.S.C. 3506
Wage and Hour Division, Department of Labor.
Notice.
The Paperwork Reduction Act of 1995 (PRA), 44 U.S.C. 3501 et seq., and its attendant regulations, 5 CFR part 1320, require that the Department consider the impact of paperwork and other information collection burdens imposed on the public. Under the PRA, an agency many 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 5 CFR 1320.8(b)(3)(vi). The OMB has assigned control number 1235-0018 to the Fair Labor Standards Act (FLSA) information collections. In accordance with the PRA, the Department solicited comments on the FLSA information collections as they were proposed to be changed by a Notice of Proposed Rulemaking published December 27, 2011 (76 FR 81199-200). 44 U.S.C. 3506(c)(2). The Department also submitted a contemporaneous request for OMB review of the proposed revisions to the FLSA information collections, in accordance with 44 U.S.C. 3507(d). On February 29, 2012, the OMB issued a notice that continued the previous approval of the FLSA information collections under the existing terms of clearance. (See OMB ICR Reference no. 201205-1235-002
Notice is hereby given that the OMB has approved the extension of the existing information collections under control number 1235-0018. The OMB has also pre-approved changes in the information collections that result from the Application of the Fair Labor Standards Act to Domestic Service; Final Rule; these changes become effective January 1, 2015.
Copyright Royalty Board, Library of Congress.
Final distribution order.
The Copyright Royalty Judges announce the final Phase II distribution of cable royalty funds for the years 2000, 2001, 2002 and 2003 for the Program Suppliers and Devotional programming categories.
Effective October 30, 2013.
The final determination also is posted on the Copyright Royalty Board Web site at
Richard Strasser, Senior Attorney, or Gina Giuffreda, Attorney Advisor. Telephone: (202) 707-7658; Email:
On February 10, 2011, the Copyright Royalty Judges (Judges) published a notice of initiation of Phase II distribution proceedings relating to cable retransmission royalties for royalty years 2000 through 2003. 76 FR 7590 (Feb. 10, 2011). Participants in the proceeding included the Motion Picture Association of America as representative of program suppliers (MPAA), the Settling Devotional Claimants (SDC),
Based on the considerations and analysis set forth in this Final Determination, the Judges conclude that the distributions at issue in this proceeding shall be:
The following findings of fact and conclusions of law are based upon the evidence introduced at the hearing, the accepted written and live testimony of the witnesses, the direct and rebuttal statements of the parties, the precedential guidance discussed in this Final Determination, and consideration of the economic analyses offered by the parties.
Beginning June 3, 2013, the Judges considered testimony of nine witnesses
On July 10, 2013, the Judges issued to the parties their Initial Determination. Pursuant to 17 U.S.C. 803(c)(2) and 37 CFR Part 353, SDC filed a motion for rehearing. After reviewing the motion, the Judges denied the motion for rehearing.
Section 111 of the Copyright Act (Act) creates a statutory license that permits cable system operators (CSOs) to retransmit copyrighted works included in broadcast television signals without obtaining the authorization of the owners of those works. When a CSO retransmits non-exempt broadcast programming outside the program's original, local broadcast area the CSO must deposit royalties based on their gross receipts with the Copyright Office semiannually. 17 U.S.C. 111(d)(1). In July of each year, copyright owners, whose works the CSOs retransmit, file claims to the royalties deposited for the previous calendar year. 17 U.S.C. 111(d)(4)(A). Claimants may file individual claims or joint claims directly, or through an authorized agent.
The Judges are charged with allocation and distribution of the statutory license royalties deposited with the Copyright Office. 17 U.S.C. 111(d)(4). By statute and regulation, the Judges must render a decision and issue a determination regarding distribution of the collected funds within 11 months of conclusion of a statutorily mandated settlement conference. 17 U.S.C. 803(c)(1); 37 CFR 352.2. The settlement conference in this proceeding took place on August 10, 2012.
Historically, individual and joint claimants have utilized a common representative to pursue on their behalf collection and distribution of the deposited royalties. Each representative pursues claims within a program category. Distribution proceedings, by convention, have progressed in two phases. In Phase I of the proceeding, claimants contest the allocation of royalties among the program categories.
The allocation of funds among individual claimants within a particular category occurs in what has been termed Phase II of the distribution proceeding. Similar to Phase I, if the claimants agree, the representatives may distribute funds in accordance with the content of the claims and any representation agreement they may have with the claimants. If the validity or amount of a claim, or the claimant's proportional share of the funds within a category, is in controversy, the Judges commence a Phase II proceeding to resolve the controversies.
Section 111(d)(4) of the Act provides that, in the event of a controversy concerning the distribution of royalties, “the Copyright Royalty Judges shall, pursuant to Chapter 8 of [title 17], conduct a proceeding to determine the distribution of royalty fees.” Unlike sections of the Act that apply to the determination of
As the Librarian of Congress (Librarian)
Section 111 does not prescribe the standards or guidelines for distributing
There is not, however, a wholesale absence of statutory guidance. Section 111 directs the Judges to act pursuant to Chapter 8 of the Act. The Judges are guided by the general directives contained in Chapter 8. In particular, Section 801 of the Act provides, in pertinent part: “The Copyright Royalty Judges shall act * * * on the basis of * * * prior determinations and interpretations of the Copyright Royalty Tribunal, Librarian of Congress, the Register of Copyrights, copyright arbitration royalty panels * * * and the Copyright Royalty Judges, * * * and decisions of the court of appeals under this chapter.” 17 U.S.C. 803(a)(1).
Accordingly, the Judges have reviewed the 12 prior determinations of Phase II proceedings under Section 111 of the Act—ten by the CRT,
Relative marketplace value is the preeminent consideration for allocating shares of royalties to programs or groups of programs.
In order to assess relative marketplace value the Judges must look to hypothetical, simulated, or analogous markets, since there is no free market for cable retransmission of broadcast television programs.
In making distributions under Section 111, mathematical precision is not required. Rather, the Judges' rulings must lie with a “zone of reasonableness.”
With the foregoing principles clearly in mind, the Judges apply the appropriate economic analysis to the evidence adduced at the hearing.
In the Phase I proceeding for the present case the parties limited by stipulation the issues to be considered by the Judges.
On February 10, 2011, on request of program suppliers represented by MPAA, SDC, and JSC, the Judges
In August 2012, the remaining participants filed motions or objections relating to the claims asserted by other participants. The participants made far-ranging objections and submitted papers and arguments to support their objections in a form that the Judges could not accept as evidence. As a result, the Judges denied all the motions and objections without prejudice and set the matter for an evidentiary hearing on claims objections. The Judges commenced the evidentiary hearing on November 13, 2012, with a continuance after two days of testimony to December 5, 2012, to complete the participants' presentations of evidence and argument.
On March 21, 2013, the Judges entered an order resolving most of the claims challenges.
Subsequent to the Preliminary Hearing, the Judges determined that IPG had no remaining valid claims to royalties in the Sports Programming category.
The SDC, with agreement of IPG, offered into evidence Exhibit 177, the Written Direct Testimony of Mr. Michael. D. Little, President and Chief Operating Officer of The Christian Broadcasting Network, Inc. At the hearing, IPG objected to the admissibility of Exhibit 3 to Mr. Little's testimony, which consists of approximately 600 pages of printouts of Internet Web sites. IPG objected that (1) the veracity of this document, derived from the Internet, is questionable, (2) Mr. Little, by his own admission, obtained the printouts from an undisclosed third party, raising further questions as to the veracity and authenticity of the Exhibit, and (3) the documents themselves are “just a bunch of random stuff without any analysis attached to it.” 6/6/13 Tr. at 1341-42. The Judges admitted Exhibit 177 and took under advisement admission of the attendant Exhibit 3.
IPG's objections are well-taken.
To distribute royalties to a copyright owner under Section 111 of the Copyright Act, the Judges must first determine whether the copyright owner is eligible to receive such royalties.
The Preliminary Hearing in this proceeding led to a resolution of almost all claims challenges asserted by the parties up to that point.
In his written rebuttal testimony, Mr. Raul Galaz of IPG asserts, for the first time in this proceeding, that 615 claims represented by MPAA and identified in Exhibit R-15 to his testimony should be dismissed because MPAA has failed to produce adequate documentation of its authority to represent the ultimate claimants,
Each of the 615 claimants is claimed indirectly by MPAA. MPAA represents a number of entities that have filed joint claims on behalf of other copyright owners. MPAA has no contractual privity with those copyright owners. Its representation of them is by virtue of its representation agreements with joint claimants who filed on their behalf. This, in itself, is no impediment to MPAA's representation.
The Judges conclude that IPG's challenge to MPAA's representation of these 615 claimants is not properly before the Judges.
Even assuming that IPG's challenges were properly before the Judges, the Judges would have rejected them. The sole ground that IPG asserts for invalidating the claims on Exhibit R-15 is that MPAA has not produced contracts between third parties—
Neither the Act, nor any of the regulations adopted under it, address what evidence is needed to establish one's authority to represent claimants in the filing of claims or in distribution proceedings before the Judges. Nevertheless, the Judges have stated that “the parties must manifest in some unambiguous manner that they intended for a principal/agent relationship to exist between them.” March 21 Order, at 12. Ultimately the question of authority is a question of fact requiring a weighing of the evidence.
In this proceeding MPAA has produced fully-executed Representation Agreements with each of the MPAA-represented program suppliers. Ex. 500.
The Judges find this evidence sufficient to establish that MPAA is duly authorized to represent the joint claimants covered by these Representation Agreements. Further evidence of representation, such as the contracts between the MPAA-represented program suppliers and the underlying claimants, is unnecessary in the absence of any evidence calling into question the authority of MPAA or the joint claimants that it represents—
Both IPG and MPAA have identified different sets of overlapping claims—
In some instances, claimants assert that they terminated their relationship with IPG either during the years covered by this proceeding or thereafter.
As to both groups, IPG asserts that the terms of their agreements specify a termination procedure that requires at least six months' notice and authorizes and obligates IPG to continue pursuit of royalties payable through the termination date. As to the first group of claims, MPAA asserts that the Judges should honor the claimants' wishes to be represented by MPAA rather than IPG. MPAA has not addressed the second group directly.
IPG has invited the Judges to engage in an interpretation of the representation agreements that it has entered into with these claimants to determine whether a claimant's purported termination satisfies the requirements of the contract. This sort of contractual interpretation is beyond the Judges' authority.
Applying this rule, the Judges resolve the representation of the overlapping claims as follows.
As to the overlapping claims where there has been no instruction from the claimant concerning representation, the Judges will take the later-in-time agreement between a claimant (or its representative) and a party as the most persuasive evidence concerning representation. Admitted written agreements are deemed more persuasive than oral testimony about the existence of an agreement.
Applying this rule, the Judges resolve the representation of the overlapping claims as follows.
An additional claimant—BBC—falls into its own category. Both MPAA and IPG have included BBC Worldwide (BBC-W) in their respective Petitions to Participate. Fintage Publishing and Collections BV (Fintage) advised the Judges that it had the exclusive right to administer and collect royalties on behalf of its client, EGEDA, and EGEDA, in turn, had such rights with respect to BBC-W.
IPG filed claims on behalf of BBC-W for 2000, and on behalf of BBC-WA for 2001-2003. Fintage filed a claim on behalf of BBC-W for 2002. BBC-WA filed its own claims for 2000 and 2001. No claims were filed on behalf of BBC-W for 2001 or 2003.
This appears to be a case of mistaken identity on IPG's part. BBC-WA's General Counsel has clarified that BBC-W (or, to be precise, BBC Worldwide Limited) is a separate entity from BBC-WA.
IPG, however, mistakenly identified its client as BBC-W, rather than BBC-WA, in its Petition to Participate. Any claimant in a distribution proceeding must file a Petition to Participate. 37 CFR 351.1 (a). Section 354.1(b)(2) requires parties to a proceeding to file a Petition to Participate within 30 days of commencement of the proceeding, providing detail concerning the participant or claimants the participant is representing in a joint petition. The Judges may accept late petitions up to a date that is no less than 90 days before the date set for filing written direct statements. 37 CFR 351.1(d). That date is long past. It is now too late to rectify IPG's error by adding a new claimant to these proceedings. BBC-WA is not a represented claimant in this proceeding, and IPG's mistaken claim for BBC-W is dismissed.
As to MPAA's representation of BBC-W, the only year for which both predicates for representation in this proceeding—filing of a valid claim and inclusion in a Petition to Participate—have been met is 2002. No claims were filed for BBC-W in 2001 and 2003. The only year in which MPAA included BBC-W in its petition is 2002 (through its inclusion of Fintage which, in turn, listed BBC-W in its joint claim). In summary:
Nearly all of the disputed claims are thus resolved in MPAA's favor (apart from Reel Funds and Venevision, which have an insignificant effect on the relative shares
IPG challenged 42 of the SDC's claims
Moreover, IPG does not (and cannot) allege that the SDC's claims are for programs that were not retransmitted on a distant basis during the claim years they challenge. 6/5/13 Tr. at 905 (Galaz). Rather, IPG argues that the claims should be dismissed because the specific example of a broadcast the Devotional claimants cited in their claims did not take place as described on the claim form. The Judges rejected that argument as a basis for challenging the validity of claims in the March 21 Order, and would do so now as well if IPG's challenge were timely.
Despite the absence of a defined statutory standard, as noted above the Judges do not write on a clean slate. More particularly, prior Phase II determinations in cable retransmission proceedings have referred to a “relative market value” standard, although “relative market value” has not been defined explicitly. In order to make explicit the Judges' application of the relative market value standard in the present Determination, the Judges begin by expressly defining relative market value.
At the outset, it is necessary to appreciate the reason for the statutory license and the concomitant distribution proceedings. Statutory licenses substitute for free market negotiations because of a perceived intractable “market failure” inherent in the licensing of copyrights—particularly the assumed prohibitively high “transaction costs” of negotiating a multitude of bilateral contracts between potential sellers and buyers.
The Judges begin parsing the phrase “relative market value” by considering the word “relative.” The fact that the Phase II categories are finite (the allocation among categories having been finalized in Phase I), indicates that the word “relative” is intended to denote that the value of any retransmitted program is to be determined in relation to the value of all other programs in the respective Phase I categories.
The next two words in the phrase—“market value”—are typically construed together. Further, “market value” is traditionally stated in decisional and administrative law more fully as “fair market value.” The Supreme Court has defined “fair market value” as “the price at which the property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of
Dr. Gray defined relative market value in his Written Direct Testimony as “the price at which the right to transmit a program carried on a distant broadcast signal would change hands between a willing buyer (a CSO) and a willing seller (a copyright owner), neither being under any compulsion to buy or sell.” Gray WDT at 7-8;
The Judges note that application of these definitions to the present dispute is neither simple nor obvious. More particularly, it is necessary to further define the various terms that comprise the foregoing definition of relative market value, which the Judges undertake below.
The copyright owner seeks to maximize profit from the licensing of the program to the CSO. Since the copyright owner's marginal costs are low and approaching zero (most of the costs incurred in creating the work are sunk, fixed costs), this means simply that the copyright owner wants to maximize the revenue it receives from the CSO as a result of the retransmission of its program over the distant broadcast signal by that CSO. Given the minimal marginal costs and the “public good” aspect of a copyrighted work, the copyright owner, as the hypothetical willing seller, will always have an incentive to sell at some positive price, but will likely engage in bargaining whereby the copyright owner threatens to refuse to grant the license unless its (undisclosed) reservation price is offered.
For the CSO, the economics are less straightforward. The revenue that the CSO earns from retransmitted broadcasts is a consequence of the impact of the retransmissions on the sale of subscriptions to its cable bundles (packages or tiers). This is in contrast to the terrestrial commercial television station whose signal is being retransmitted, and whose revenues are received from advertisers.
To the CSO, the program offered by the Copyright Owner is an input—a factor of production—utilized to create the product that the CSO sells to its customers,
The “compulsion” limitation within the definition of “fair market value” is often treated as a truism and thus not subject to analysis. Here, in the actual (
Is this required bundling a form of “compulsion” upon the CSO? It is
Further, certain programs may have more substantial viewership, but that viewership might merely duplicate viewership of another program that generates the same sub-set of subscribers. For example, hypothetically, the viewers of reruns of the situation comedy “Bewitched” may all be the same as the viewers of reruns of “I Dream of Jeannie,” a similar supernatural-themed situation comedy. However, “Bewitched” may have fewer viewers than “I Dream of Jeannie.” The hypothetical, rational profit-maximizing CSO that had already paid for a license to retransmit “I Dream of Jeannie” would not also pay for “Bewitched” in this hypothetical marketplace, because it fails to add marginal
If the Judges were to measure “relative market value” in these instances solely by viewership of the programs actually retransmitted, then the valuation process would arguably fail the “non-compulsion” requirement of the “fair market value” standard
Simply put, the hypothetical, rational profit-maximizing CSO would not pay copyright owners based solely on levels of viewership. Rather, the hypothetical CSO would (i) utilize viewership principally as a heuristic to estimate how the addition of any given program might change the CSO's subscriber revenue, (ii) attempt to factor in the economics of various bundles; and (iii) pay for a program license (or eschew purchasing that license) based on that analysis.
On the other side of the coin, is the seller,
Of course, in the “hypothetical market” that the Judges are charged with constructing, it would be inappropriate not to consider the inherent bundling that would occur. That is, the bundling decision is a “feature” rather than a “bug” in even a hypothetical market in which the statutory license framework does not exist. Thus, while the copyright owner could offer to supply its program at a given price, the equilibrium market price at which supply and demand would intersect would reflect the CSO's demand schedule, which is based in part upon the fact that the buyer,
To summarize, the hypothetical market the Judges will apply in this Determination contains the following participants and elements: (1) The hypothetical seller is the owner of the copyrighted program; (2) the hypothetical buyer is the CSO that acquires the program as part of its hypothetical bundle of programs; and (3) the absence of compulsion requires that the terrestrial stations' initial bundling of programs does not affect the marginal profit-maximizing decisions of the hypothetical buyers and sellers.
As in past distribution proceedings, MPAA's calculation of relative market value is based almost exclusively upon estimated levels of viewership of the distantly retransmitted programs, as based on data received from Nielsen.
The initial steps of MPAA's proposed relative market value calculation entail selection of a sample of television stations whose programming would be the basis for the remuneration of royalties to MPAA-represented claimants (Kessler Sample). Ms. Marsha Kessler, a former executive of MPAA, testified that she obtained from Cable Data Corporation (CDC)
Ms. Kessler forwarded the Kessler Sample stations to Nielsen, instructing Nielsen to measure viewing only in the counties identified by MPAA as outside the originating station's local county viewing area.
Mr. Paul Lindstrom, Senior Vice President at Nielsen, testified that Nielsen provided MPAA with so-called “diary data” for each of the Kessler Sample stations measuring viewing in non-local counties during sweeps periods.
Diaries are paper booklets in which each person in the household records viewing information. In 2000-2003, diary data were collected in Nielsen's diary markets during the months of November, February, May, July, and in some cases October and March, which are also known as the “sweeps” ratings periods (Nielsen Diary Data). Nielsen mailed seven-day diaries to homes randomly selected by Nielsen to keep a tally of when each television in the household was on, what it was tuned to, and
MPAA also retained the services of the Reznick Group P.C. (now known as CohnReznick LLP) (Reznick) to match title information provided by MPAA to compensable retransmissions of television broadcasts. Mr. Kelvin Patterson of Reznick testified that he and his team at Reznick conducted two analyses for MPAA—one based on Tribune Media Services (Tribune) data and the other based on MPAA title information provided to Reznick by MPAA. The first required Reznick to examine broadcast television station logs provided by Tribune for the Kessler Sample stations and a separate set of sample stations provided by MPAA's economics expert, Dr. Jeffrey Gray (Gray Sample), for each of the years 2000, 2001, 2002 and 2003, and exclude those program titles that are not compensable for purposes of this proceeding in the Program Suppliers category: (1) Programs identified in the Tribune Data as broadcast type ABC, CBS and NBC (
The second analysis conducted by Reznick involved using a computer to electronically compare a list of program titles claimed by MPAA-represented claimants, prepared and provided by MPAA,
MPAA retained Dr. Gray to design an allocation methodology and compute the results of that methodology (the MPAA Methodology). 6/4/13 Tr. at 440 (Gray). Dr. Gray testified that his analysis seeks to determine the “relative market value” of copyrighted programs based on an econometric model of estimating viewership that takes into account program characteristics and popularity that affect the program's predicted relative viewership. His approach analyzes program volume, program viewing and the number of subscribers for the Gray Sample—a stratified random sample of 120 stations generated by Dr. Gray from CDC data for each year from 2000 to 2003. Gray WDT at 3, 9; Gray WRT at 25, 30.
Dr. Gray relied upon five data sources in creating and applying the MPAA Methodology: (1) CDC data for all cable system operators in the United States who distantly retransmitted broadcast signals, which included information about the signals they distantly retransmitted as well as the total number of distant subscribers to those signals; (2) a custom analysis of Nielsen Diary Data, prepared by Mr. Lindstrom, which shows the viewing of distant retransmissions of the Kessler Sample stations during Nielsen's “sweeps” periods; (3) information from Nielsen's local ratings, derived from individual television electronic meters, provided on a quarter-hour basis, for 24 hours a day, seven days a week, and 12 months a year (Local Ratings Data), for the Gray Sample stations; (4) Tribune Data, including the program title, time of broadcast, information on the station, whether or not the station was a network affiliate, the type of programming, the actors and directors and other information about the program, for every broadcast in the Kessler Sample stations and Gray Sample stations; and (5) the Reznick data analyses, in the form of a list of MPAA compensable programming, based upon start time, date and station, and a separate list of IPG compensable programming, based upon start time, date and station. 6/4/13 Tr. at 447-50 (Gray).
Dr. Gray analyzed the relationship between distant viewing and local ratings, holding constant the number of distant subscribers, which, Dr. Gray posited, is equivalent to examining distant ratings and local ratings. Dr. Gray testified that he found a positive and strong statistically significant relationship between distant viewing and local ratings. After establishing this correlation, Dr. Gray built his full econometric model combining all of the five data sets he identified in his written testimony.
Based on his analysis, Dr. Gray calculated the viewership (and distribution) shares of MPAA and IPG programming as follows.
IPG opposes a relative market value assessment based solely on Nielson viewership data. One broad attack by IPG on the use of Nielsen viewership data is that the data do not exist until
However, such a measure would be quite difficult to assemble in a Section 111 proceeding. Each type of program would be subject to its own yardstick: For example, reruns could be valued based on their prior ratings, newly syndicated programs could be valued based on the past ratings of comparable programs; and first-run televised movies could be valued based on their box-office value in theaters. The gathering and presentation of such evidence likely would be prohibitively expensive, and the evidence in the record before the Judges does not permit such an analysis.
Another attack by IPG on the use of Nielsen Data concerns the so-called “zero viewing” problem. The quarter-hour sampling points within the Nielsen Data relied upon by MPAA contain, annually, between 76% and 82% “zero viewing” sampling points. Robinson WRT at ¶ 31. In previous Phase II proceedings the existence of these “zero viewing” sampling points had not been adequately explained by MPAA's witnesses, which diminished the value of its methodology.
First, to be precise, the percentages of “zero viewing sampling points” represent—on a station-by-station basis—the percent of total sampling points at which no sample households with Nielsen diaries recorded that they were viewing that station. These percentage figures do not represent that “zero households” had viewed a particular program over the entirety of the sampling period,
Second, the Judges agree with Mr. Lindstrom that these “zero viewing” sampling points can be considered important elements of information, rather than defects in the process. As Mr. Lindstrom testified, when doing sampling of counts within a population, it is not unusual for a large number of zeros to be recorded, 6/4/13 Tr. at 391-93, 410 (Lindstrom), and those “zero viewing” sample points must be aggregated with the non-zero viewing points. 6/3/13 Tr. at 323 (Lindstrom).
Third, as Dr. Gray testified, when those zeros are included with non-zero data from the sample in a regression that correlates local and distant viewing, the zeros are placed in an appropriate statistical context. 6/14/13 Tr. at 614-15 (Gray).
Fourth, as Mr. Lindstrom testified, distantly retransmitted stations typically have very small levels of viewership in a television market fragmented (even in the 2000-2003 period) among a plethora of available stations. 6/4/13 Tr. at 393 (Lindstrom). Thus, it would be expected, not anomalous, for Nielsen to record some zero viewing for any given quarter-hour period within the diary sampling (sweeps) period.
Despite these reasonable and credible explanations of the “zero viewing” sampling points, the Nielsen data are not without problems. The sample size is not sufficient to estimate low levels of viewership as accurately as a larger sample. Mr. Lindstrom acknowledged that “[t]he relative error on any given quarter-hour for any given station * * * would be very high,” 6/3/13 Tr. at 303 (Lindstrom)—an acknowledgment echoed by Dr. Gray. 6/4/13 Tr. at 518-19 (Gray) (agreeing that, with samples of 10,000 households, there is a high relative error rate for each quarter-hour “point estimate”).
Furthermore, Mr. Lindstrom acknowledged that he had not produced the margins of error or the levels of confidence associated with the Nielsen viewership data, despite the fact that such information could be produced. 6/3/13 Tr. at 391-93, 410 (Lindstrom). Without this information, the reliability of any statistical sample cannot be assessed. (By way of comparison, Dr. Gray provided with his conclusions the margin of error and the level of confidence associated with his findings. Gray WRT at 26 n.25.). The Judges infer that, had such information underscored the reliability of the Nielsen data, it would have been produced by MPAA.
Thus, the Judges conclude that viewership as measured after the airing of the retransmitted programs is a reasonable, though imperfect proxy for the viewership-based value of those programs.
(2) Dr. Gray's Economic Analysis
The Judges credit the economic analysis undertaken by Dr. Gray, as set forth in his Written Direct Testimony
The Judges agree with Dr. Gray that the programs within the Program Suppliers category are more homogeneous
Moreover, the Judges rely upon Dr. Gray's use of a
The Judges credit Dr. Gray's testimony that MPAA refused to abandon the Kessler Sample and that, without it, Dr. Gray would not have had access to distant signal viewing data with which to perform his regression. The Judges likewise credit Dr. Gray's testimony as to the fact that scrapping Ms. Kessler's non-random sample likely would have caused additional expense for MPAA, as MPAA would have been required to rely on Dr. Gray's truly random sample and develop a new set of distant signal viewing data through additional work by CDC, Nielsen and Reznick. 6/4/13 Tr. at 583-587 (Gray). Although the Judges understand why MPAA might have chosen to avoid this additional cost and rely, at least in part, on a compromised sample of stations, that cost-saving decision compromises the Judges' ability to give more weight to Dr. Gray's analysis than they have done in this Determination.
Dr. Gray attempted to demonstrate that the use of the flawed Kessler Sample did not damage the accuracy of his analysis. The Kessler Sample suffered from Ms. Kessler's intentional selection of the largest stations in terms of subscribers, and her “intuitive” decision to cut off her sampling at a particular level. 6/3/13 Tr. at 122 (Kessler). This bias toward larger stations could have prejudiced IPG, if the programs of the IPG-represented claimants were relatively more concentrated on smaller stations than were the MPAA-represented programs. To test that possibility, Dr. Gray ran his regression including only the bottom quartile of the Kessler Sample stations and found no change in viewership estimates. 6/4/13 Tr. at 469-70, 500, 570 (Gray). Of course, that fact only indicates that, within the Kessler Sample, changes in broadcast station size did not affect IPG negatively, and at best only suggests that inclusion of even smaller stations (excluded from the Kessler Sample or within Dr. Gray's 120-station sample but excluded from the 70-station Kessler/Gray overlapping sample) would not have increased viewership estimates for IPG.
The Judges view favorably Dr. Gray's decision to increase his data base by supplementing it with Nielsen
Nevertheless, the Judges find that Dr. Gray's decision not to summarize the results of his regression as it related to other independent variables, especially the impact of time of day upon the level of distant viewing of the transmitted stations, is a shortcoming in his analysis. Dr. Gray conceded that there was a strong positive relationship between time of day and the level of distant viewing, 6/4/13 Tr. at 639-41 (Gray), which could support IPG's use of a Time Period Weight Factor as a basis for allocating royalties. 6/4/13 Tr. at 639-43 (Gray).
In addition, the Judges recognize the criticism, leveled by IPG's expert witness, Dr. Laura Robinson, that Dr. Gray wrongly replaced Nielsen Diary Data regarding distant viewing for the six months of sweeps, with his projected data, derived from Nielsen Local Viewing Data. Dr. Robinson also noted that, if Dr. Gray had retained his Nielsen Diary Data, with its approximate 80% of zero viewing sampling points, he should have had at least a level of approximately 40% zero viewing points in his final analysis. 6/6/13 Tr. at 1202-03.
In response to Dr. Robinson's criticism, Dr. Gray ran the distant viewership numbers in the manner suggested by Dr. Robinson. To use Dr. Gray's terminology, using these “supplant” values would have resulted in an even greater allocation to MPAA at the expense of IPG. 6/6/13 Tr. at 1328-30 (Gray). IPG objected that it had not been afforded the details of this analysis previously, but the Judges discount that objection, given that Dr. Robinson had not presented her critique of this aspect of Dr. Gray's analysis until her live testimony at the hearing.
The Judges also acknowledge Dr. Robinson's criticism that, given the level of zero viewing in the raw Nielsen diary data, Dr. Gray should have used a different regression model than his selected Poisson regression. Dr. Gray defended his use of the Poisson regression model, however, as a basis to perform a regression with such a large number of zeros in the data. Although Dr. Robinson suggested the use of another form of regression to account for the relatively high number of zeros, (such as a negative binomial regression), she did not provide any alternative analysis to indicate how such a different form of regression would have changed the results, and Dr. Robinson acknowledged that she therefore was unable to state that Dr. Gray's conclusions were wrong. 6/6/13 Tr. at 1279-81 (Robinson). Moreover, to the extent the zeros in the raw data reflect non-viewing of television at the moment of sampling, or to the extent they reflect poor sampling of small numbers of viewers, a separate regression to account for the zero viewing may have been appropriate. As noted,
Another of IPG's criticisms of the MPAA Methodology concerns the treatment of Canadian and Mexican stations.
Section 111(c)(1) unambiguously grants cable system operators a statutory license to retransmit Canadian and Mexican broadcast stations.
As to the categorization of programs carried on Canadian and Mexican Stations, the parties in the Phase I proceeding in this matter stipulated to definitions of the following program categories: Program Suppliers; Joint Sports Claimants; Commercial Television; Public Broadcasting; Devotional Claimants; Canadian Claimants; National Public Radio; and Music Claimants. The definitions are mutually exclusive and, in the aggregate, comprehensive.
The “Canadian Claimants” category is defined as:
All programs broadcast on Canadian television stations, except (1) live telecasts of Major League Baseball, National Hockey League, and U.S. college team sports, and (2) other programs owned by U.S. copyright owners.
The first exception describes programs that fall within the Sports Programming category.
Live telecasts of professional and college team sports broadcast by U.S. and Canadian television stations, except for programs coming within the Canadian Claimants category * * *.
Kessler WRT at Addendum B.
Syndicated series, specials and movies, other than Devotional Claimants programs as defined [in the stipulation]. Syndicated Series and specials are defined as including (1) programs licensed to and broadcast by at least one U.S. commercial television station during the calendar year in question, (2) programs produced by or for a broadcast station that are broadcast by two or more U.S. television stations during the calendar year in question, and (3) programs produced by or for a U.S. Commercial television station that are comprised predominantly of syndicated elements, such as music video shows, cartoon shows, “PM Magazine,” and locally hosted movie shows.
There is no “Mexican Claimants” category, so any compensable programming carried on distantly retransmitted Mexican broadcast stations must fall into one of the other agreed categories (other than Canadian Claimants), including the Program Suppliers. It is simply incorrect to conclude that all compensable programming on distantly retransmitted Canadian and Mexican broadcast stations falls outside the Program Suppliers category. MPAA erred by excluding Canadian and Mexican stations from its analysis.
The Judges do not have before them sufficient evidence to determine the precise degree to which MPAA's exclusion of Canadian and Mexican stations has affected their proposed distribution. The Judges can, however, construct a rough estimate based on IPG's sample stations, which were selected because they were the most widely retransmitted television stations based on fees generated. 6/5/13 Tr. at 762 (Galaz).
Of the 223 stations that IPG included in its sample for royalty year 2000, 12 stations (5.38% of the total) were Canadian. Those stations represented 4.46% of the overall number of distant subscribers covered in the IPG sample. Only two Mexican stations (0.90% of the total) were included in the IPG sample, representing 0.02% of distant subscribers covered in the IPG sample. The Judges conclude that the effect on MPAA's proposed distribution shares of excluding Mexican stations from their regression analysis was negligible. On its face, however, the impact of excluding the Canadian stations may not be negligible.
Evidence from the Phase I proceeding suggests that a relatively small amount of the programming on Canadian broadcast stations is allocable to the Program Suppliers category. Written Direct Testimony of Janice de Freitas, Ex. CDN-1, Docket No. 2008-2 CRB CD 2000-2003 (Phase I) at 6 and Ex. CDN-1-I. Assuming, for purposes of this rough estimate, that there are half as
For the exclusion of the relatively small percentage of programs broadcast on Canadian stations to have a material impact on the relative shares computed by MPAA, the proportion of MPAA-represented programs to IPG-represented programs on Canadian stations would have to differ fairly significantly from that on U.S. stations. There is no evidence to suggest that it does.
IPG's distribution methodology (the IPG Methodology) was created by Mr. Raul Galaz, an employee and former principal of IPG. Mr. Galaz testified that the IPG Methodology was formed in response to a perceived bias in the distribution methodology historically utilized by MPAA. Galaz WDT at 7-8. IPG espouses that each and every program that is broadcast by a terrestrial station, and is thereafter retransmitted by a CSO pursuant to the Section 111 statutory license, is entitled some portion of the fees deposited with the U.S. Copyright Office.
Upon the commencement of this Phase II proceeding, IPG obtained updated data from CDC of all Form 3 retransmitted stations from 2000-2003, which data included the number of households to which any particular terrestrial signal was retransmitted, as well as the fees generated from the retransmission of any particular terrestrial signal. IPG ranked such stations on a year-by-year basis, according to the cable retransmission fees generated by such stations.
IPG thereafter acquired from Tribune Media the programming data for the 200 broadcast stations (IPG Sample) generating the largest amount of cable retransmission fees, and supplemented such information with broadcast data already acquired by IPG for calendar years 2000 and 2001.
According to Mr. Galaz, IPG then undertook to confirm with all of the claimants that it represents exactly which titles and broadcasts were owned or controlled by them. IPG submitted to each claimant the list of compensable titles, and requested that the claimant respond to IPG with a list of any titles on the list that correspond to titles owned or controlled by the claimant. In some circumstances IPG determined which titles and broadcasts were owned or controlled based on information within the IPG contracting documents, or information previously provided to IPG in the course of IPG's representation. Galaz WDT at 18; 6/5/13 Tr. at 791-93 (Galaz). Based on that vetting process, IPG determined that 1,297 compensable programs were owned or controlled by IPG-represented claimants, reflected within 541,586 compensable broadcasts. Galaz WDT at 10;
The weight that IPG accorded to any given compensable broadcast was the product of (
IPG took two alternative approaches to creating a Station Weight Factor. One assigned a value to a station based on the number of distant cable subscribers that received retransmissions of that station's broadcasts. The other assigned a value to a station based on the amount of distant cable retransmission fees generated by the station, as disclosed in CDC data. IPG presented three alternative computations based on each of the Station Weight Factors and an average of the two. Galaz WDT at 18;
The Time Period Weight Factor reflects the fact that average television viewership varies by time of day. IPG based the Time Period Weight Factor on Nielsen Media Research's assessment of distant viewership of all persons during 48 half-hour dayparts that was, in turn, based on Nielsen viewing data from 1997.
Mr. Galaz testified that the IPG Methodology seeks to replicate the decisions actually made by CSOs by looking at data representative of such decisions, and data reflecting the aggregate of information that a CSO could have had at the time of its decision to retransmit a broadcast station. 6/5/13 Tr. at 761, 763, 768 (Galaz). He explained that it was for this reason that IPG used its Time Period Weight Factor in preference to projections of actual viewership. IPG avers that actual viewership can only be known after a broadcast has taken place; prior to a CSO's decision to retransmit a particular broadcast, the CSO may only reasonably predict on a day-by-day basis the relative viewership of a program based on the timing of its placement on a station's lineup. Galaz WDT at 20-22; 6/5/13 Tr. at 770-75 (Galaz).
As a final step, the broadcast length of all compensable broadcasts appearing in the IPG analysis was applied against the “Station Weight Factor(s)” and the “Time Period Weight Factor” to create a weighted value for each of the broadcasts. After segregating the compensable broadcasts into their respective Phase I categories, including the Program Suppliers category, IPG summed the resulting weighted values for (i) all IPG-claimed broadcasts, and (ii) all MPAA-claimed broadcasts. Galaz WDT at 24; Galaz WRT at Exs. R-19 (revised) and R-20 (revised); 6/5/13 Tr. at 778 (Galaz). By comparing these
Using a Station Weight Factor based on numbers of distant subscribers, IPG computed the following proposed relative distribution shares.
Using a Station Weight Factor based on fees generated, IPG computed the following proposed relative distribution shares.
Using an average of the shares produced by the previous two methods, IPG computed the following proposed relative distribution shares.
IPG, through the written testimony of its sole direct witness, Mr. Galaz, did not definitively state that its methodology was an application of “relative market value.” Galaz WDT at 11. At the hearing, on cross-examination, Mr. Galaz initially declined to state that the IPG Methodology was consonant with any “economic principle.” Under further cross-examination, Mr. Galaz testified that he thought that the IPG Methodology fits under the “relative market value” standard. 6/5/13 Tr. at 942-47.
The IPG Methodology for distributing royalties in this Phase II proceeding eschews explicit reliance upon viewership levels. Rather, IPG asserts that “certain obvious factors that would otherwise affect a negotiated license between a producer and an exhibitor are not present in the compulsory licensing scheme * * * .” Galaz WDT at 12. The Judges understand IPG's position in this regard to be premised on the assertion that the hypothetical CSO is interested in maximizing subscriber fees (
IPG is not incorrect in its assertion of the different “factors” (
First, the maximization of subscriber revenues or levels is not divorced from viewership levels. Rather, a CSO would attract subscribers on a distantly retransmitted station only to the extent that the programs it offered were demanded by consumers who intended to
Second, it is true, as IPG asserts, that since a CSO is concerned about which programs the marginal subscriber might prefer, a CSO may prefer a program with a smaller level of viewership if that viewership represents
Third, the IPG Methodology does not follow from the foregoing critique. Rather, the IPG Methodology uses factors that tend to treat as similar programs that are distantly retransmitted at the same time of day, run for the same number of minutes per program or that appear on the same station. Thus, the IPG Methodology considers neither the initial necessity of considering absolute viewership nor the subsequent necessity of considering the iterative process (“perhaps a “game theoretic” approach, as Dr. Robinson testified). Simply put, aside from any other defects in the IPG Methodology, it is not true to its own critique of a viewership-based analysis.
IPG's direct case also suffers from the fact that it was presented by a particular single witness, Mr. Galaz. For the following reasons, Mr. Galaz, to say the least, was an imperfect messenger to convey the IPG Methodology.
First, the Judges note that Mr. Galaz was previously convicted and incarcerated for fraud in the context of copyright royalty proceedings—a fraud that caused financial injury to MPAA. 6/5/13 Tr. at 932 (Galaz). In connection with that fraud, Mr. Galaz also admittedly lied in a cable distribution proceeding much like the instant proceeding.
Second, Mr. Galaz, the founder and previously an owner of IPG, is now an employee of IPG. Galaz WDT at 7. IPG is currently owned by his mother and sister. 6/5/13 Tr. at 1079 (Galaz). Thus, he clearly has a self-interest which renders the IPG Methodology—of which he is the architect—less credible than a methodology created by an outside expert.
Third, Mr. Galaz acknowledged that he is not an economist, statistician, or econometrician, and that he had no particular expertise that would permit him to opine as an expert on the construction of a methodology to establish “relative market value” in this distribution proceeding. 6/5/13 Tr. at 928-30. The Judges gave serious consideration to granting the motion
Fourth, Mr. Galaz did not indicate that he had any experience working for or on behalf of a CSO, and he admitted that he had not discussed the IPG Methodology with any CSO. 6/5/13 Tr. at 970-72. Thus, his suppositions as to how a CSO might construe viewership lack foundational support. Moreover, since Mr. Galaz is not an economist, he cannot apply microeconomic theory in order to opine upon the economic incentives to which a hypothetical CSO might respond when acquiring a bundle of licenses from owners of program rights.
In addition to the foregoing overarching and substantial defects in IPG's direct case, particular elements of the IPG Methodology are also deficient.
First, IPG contends that the purpose of the IPG Methodology is to compensate every claimant, even if there is no evidence that there was any viewership of the claimant's program.
Second, IPG's “sample” of stations was not selected in a statistically random manner.
Third, the IPG Methodology, with its reliance on the so-called “Station Weight Factor,” grossly ignores viewership, resulting in a much higher relative market value for relatively low-rated programs. The following two pairs of examples from Dr. Gray's Written Rebuttal Testimony, unrebutted by Mr. Galaz at the hearing, show how the IPG Methodology calculates the relative value of two programs as identical, merely because they aired at the same time of day, even though the MPAA-claimant programs (“Judge Joe Brown” and “Pokémon”) had substantially higher viewership levels than the IPG-claimant programs (“Animal Adventures” and “Dragon Ball Z”) which aired in the same time period:
Fourth, the IPG Methodology, with its additional reliance on the so-called “Time Period Weight Factor,” ascribes equal relative value to MPAA-claimed programs and IPG-claimed programs that aired on the same station and for the same duration, despite substantially different levels of viewership. The following comparison of programs that aired on WGN in 2001 demonstrates this outcome.
Fifth, compounding the problems with the IPG Methodology, Mr. Galaz utilized 1997 data to estimate the level of viewing throughout the broadcast day, rather than data that was contemporaneous with the 2000 through 2003 royalty distribution period at issue in this proceeding.
Sixth, Mr. Galaz claimed originally to have utilized half-hour viewing segments to create his Time Period Weight Factor. However, as Dr. Gray explained in his Written Rebuttal Testimony, Mr. Galaz in fact did not utilize half-hour viewing segments in his analysis, but rather utilized the six “daypart” categories upon which IPG had relied in the 1993-1997 Phase II proceeding, which reliance was criticized by the CARP convened for that prior proceeding. Gray WRT at 20-21. Mr. Galaz acknowledged this problem, described it as a good faith error, and changed his calculations by substituting the half-hour viewing segments for his “daypart” categories in his application of the Time Period Weight Factor.
What is particularly noteworthy about this issue is the extent to which the use by Mr. Galaz of the “daypart” categories, as compared to his claimed use of the half-hour segments, inured to IPG's benefit. As Mr. Galaz testified, 6/6/13 Tr. at 1155-56 (Galaz), his use of the “daypart” categories significantly inflated IPG's claimed percentage of the Program Suppliers category in each of the years at issue as follows.
For 2000, IPG's claimed percentage was inflated by 23%,
For 2001, IPG's claimed percentage was inflated by 32%,
For 2002, IPG's claimed percentage was inflated by 27%,
For 2003, IPG's claimed percentage was inflated by 21%,
Given the serious issues of credibility regarding Mr. Galaz's testimony, as discussed
Seventh, the IPG Methodology, although
Although the Judges reject the
First, Dr. Gray acknowledged that the IPG Methodology was an “approximation” of Dr. Gray's own methodology, albeit a “
Second, as noted
Third, IPG's argument that lower-rated shows might enhance subscriber fees or levels more than higher-rated shows is a logical economic concept. In that regard, the Judges understand IPG's theory to be an application of the bundling problem in economics, an application that can be summarized as follows.
When bundling is considered, the economic analysis shifts from the relatively straightforward profit maximization analysis advanced by MPAA (using viewership as a measure of value) to a more nuanced valuation assessment. In essence, the hypothetical CSO whose buying decisions we must consider would create an ersatz station by bundling programs in a combination that would maximize its expected revenues or volumes (with all other costs assumed constant). As previously explained, an attempt to maximize profits would result in the purchase of program licenses at a fee (the marginal cost of the program input) up to the anticipated MRP from that program in a competitive market.
So stated, IPG's argument is rational in
For the foregoing reasons, the Judges conclude that the IPG Methodology cannot be applied to establish the basis for an allocation of the royalties in the Program Suppliers category. However, given the few generally correct principles, noted above, within the IPG Methodology, and given certain imperfections in the MPAA Methodology, the Judges conclude that the allocations otherwise established by a strict application of the MPAA Methodology should be adjusted downward
The Judges conclude that the MPAA Methodology should be accorded substantial weight in establishing the zone of reasonableness for the allocations in the Program Suppliers category. By contrast, in light of the Judges' conclusion that the IPG Methodology is seriously deficient, the IPG methodology cannot be used in establishing the parameters of the zone of reasonableness for the allocation of royalties in the Program Suppliers category.
The Judges conclude that the “zone of reasonableness” in the Program Suppliers category in this proceeding corresponds with the range established by the 95% confidence interval that Dr. Gray computed for MPAA's proposed distribution allocation.
Accordingly, the Judges establish the following annual distribution levels, finding them to be within the zone of reasonableness:
IPG proposes the identical formula for the Devotional allocations as it proposed for the Program Suppliers category. Specifically, IPG applies a methodology that considers: (1) The station(s) on which a devotional program appeared, thereby providing the number of subscribers receiving the distantly retransmitted station and the fees paid by those subscribers (the Station Weight Factor); (2) the time of day during which each devotional program was broadcast (the Time Period Weight Factor); and (3) the length of each devotional program. These factors are then multiplied and aggregated for IPG and MPAA programs. IPG then uses those aggregate program values to determine the relative value as between the IPG-claimed Devotional Programs and the SDC-claimed Devotional Programs.
IPG's formula produced absurd results in the Devotional category, as it did in the Program Suppliers category. The Judges note Dr. Brown's Amended Written Rebuttal Testimony, in which he explained how, for example, in the Devotional category, application of the IPG Methodology bizarrely: (1) Would cause a program with 167% of a competing program's national rating to receive
More generally, in the discussion regarding the Program Suppliers distributions, the Judges have explained in detail the deficiencies in the IPG Methodology, and the few positive attributes arising from—to use Dr. Gray's language—the “crude approximation” of relative market value created by the IPG Methodology. The Judges adopt in this Devotional category analysis those prior statements regarding the attributes of the IPG Methodology.
The SDC explicitly requests that, in the Devotional category, the Judges adopt the MPAA Methodology to establish relative market value. Indeed, the SDC claims to have relied upon,
The SDC's direct case consisted of the written and oral testimony of Dr. William Brown and the written testimony of Mr. Michael Little, which was admitted pursuant to stipulation of the SDC and IPG.
The heart of the SDC's case rests on Dr. Brown's testimony. Dr. Brown, a Professor and Research Fellow at the School of Communication and the Arts at Regent University in Virginia Beach, Virginia, served as the SDC's expert witness in the field of communication theory and research.
Nielsen compiled data on an overnight basis using a scientific sample of several thousand households electronically metered to monitor TV viewing, and during sweeps periods (pre-selected, 4-week cycles) using tens of thousands of diaries of households that keep records of TV viewing activities.
At no time during the direct phase of its case did the SDC offer any testimony, written or oral, specifically setting forth the
Nielsen's quarter hour results were * * * transmitted to
The Judges excluded Mr. Whitt's testimony on the basis that the SDC was required by the Judges' regulations to provide Mr. Whitt's testimony in its
By failing to provide Mr. Whitt's testimony until its rebuttal case, a mere three weeks before the hearing, the SDC prejudiced IPG and, in essence, engaged in trial by ambush, in violation of the letter and spirit of the Judges' procedural rules. More specifically, by not including Mr. Whitt's testimony in its direct case, the SDC deprived IPG of the opportunity to review the work undertaken by Mr. Whitt. Although Dr. Brown, in his Written Direct Testimony, indicated that the SDC intended to utilize the MPAA Methodology,
In light of the foregoing, the Judges are faced with a Hobson's Choice. The SDC has failed to introduce evidence of its distribution methodology in a timely manner. IPG has set forth a methodology that suffers from a number of flaws and which has validity only in certain limited respects, as explained above. The Judges are, nevertheless, obligated to reach a determination based on the existing record. Given the evidentiary constraints, and in order to allocate the royalties in the Devotional category in a manner within the “zone of reasonableness,” the Judges hereby conclude as follows.
IPG's proposed allocations, and the SDC's proffered allocations (unsubstantiated in the SDC's direct case) are as follows.
For the year 2000, the Judges note that the IPG proposal falls within the range the SDC had proposed. There is, therefore, some degree of agreement between the parties as to the appropriate allocation. Accordingly, the Judges find it well within the “zone of reasonableness” to allocate 62.86% of the royalties in the Devotional category to SDC and the remaining 37.14% to IPG.
For the year 2002 (the years 2001 and 2003 will be considered below), a very similar (but not identical) situation exists. The IPG proposal is almost equal to the lower bound of the results of the SDC's proffered distribution range. Given this near equality, the Judges find that for the year 2002, again there is some degree of agreement between the parties as to the allocation of royalties. It is well within the “zone of reasonableness” to allocate the royalties in the Devotional category for the year 2002 as follows: 58.98% to SDC and 41.02% to IPG.
For the years 2001 and 2003, there is a marked difference between the percentage allocations proposed by IPG and the percentage allocations set forth in the SDC's proffered allocations (unsubstantiated in the SDC's direct case), and, therefore, little agreement between the parties. Given the wide divergence between the competing methodologies, the Judges cannot reconcile the competing proposals in the same manner as undertaken for the years 2000 and 2002.
Given that the SDC's application of its methodology was not supported in the SDC's Direct Case, and that the SDC's attempt to provide such support in Mr. Whitt's rebuttal testimony was not timely presented and, therefore, rejected, that methodology cannot serve as any guide-post for the Judges to apply (except, as noted above, to the extent that the allocations proposed by the SDC demonstrate some degree of agreement between the parties). Moreover, since the SDC Methodology cannot be credited, there is no record evidence explaining why the percentage
The IPG Methodology, while in evidence, is so flawed that the Judges cannot credit the percentage allocations as proposed. Indeed, in prior determinations, the CRT did not hesitate to make a “downward adjustment” to a participant's proposal to reflect “perceived deficiencies in the methodology.”
Accordingly, the Judges conclude that the percentage allocations for the years 2001 and 2003 should be set at the average of the allocations for the years 2000 and 2002. Therefore, the allocations for each of the years 2001 and 2003 shall be 60.92% to SDC and 39.08% to IPG. To summarize, the royalty allocations in the Devotional category for the years 2000 through 2003 shall be:
This Final Determination determines the allocation of cable royalty funds for the years 2000, 2001, 2002, and 2003 in the Program Suppliers and Devotional categories, respectively. The Register of Copyrights may review the Judges' final determination for legal error in resolving a material issue of substantive copyright law. The Librarian shall cause the Judges' final determination, and any correction thereto by the Register, to be published in the
The Judges ruled as follows.
National Aeronautics and Space Administration (NASA).
Notice of meeting.
In accordance with the Federal Advisory Committee Act, Public Law 92-463, as amended, and the President's 2004 U.S. Space-Based Positioning, Navigation, and Timing (PNT) Policy, the National Aeronautics and Space Administration (NASA) announces a meeting of the National Space-Based Positioning, Navigation, and Timing (PNT) Advisory Board.
Wednesday, December 4, 2013, 9:00 a.m. to 5:00 p.m.; and Thursday, December 5, 2013, 9:00 a.m. to 12:00 p.m., Local Time.
The Omni Shoreham Hotel, 2500 Calvert Street NW., Washington, DC 20008.
Mr. James J. Miller, Human Exploration and Operations Mission Directorate, NASA Headquarters, Washington, DC 20546, (202) 358-4417, fax (202) 358-2830, or
The meeting will be open to the public up to the seating capacity of the room. It is imperative that the meeting be held on these dates to accommodate the scheduling priorities of the key participants. Visitors will be requested to sign a visitor's register.
The agenda for the meeting includes the following topics:
• Update on U.S. Space-Based Positioning, Navigation and Timing (PNT) Policy and Global Positioning System (GPS) modernization.
• Explore opportunities for enhancing the interoperability of GPS with other emerging international Global Navigation Satellite Systems (GNSS).
• Examine emerging trends and requirements for PNT services in U.S. and international arenas through PNT Board technical assessments.
• Prioritize current and planned GPS capabilities and services while assessing future PNT architecture options.
• Assess the current and projected economic impact of GPS on the United States, and consider the effects of potential PNT service degradation if adjacent radio-band spectrum interference is introduced.
The Members of the National Council on Disability (NCD) will meet in closed executive session by phone on Friday, November 1, from 1:00 p.m.-2:00 p.m., Eastern.
The meeting will occur by phone. The meeting will be open only to the NCD Council Members.
The meeting on Friday, November 1, from 1:00 p.m. till 2:00 p.m., Eastern will be closed to the public.
The Council will meet by phone to discuss matters related solely to internal personnel rules and practices of exigent import, pursuant to paragraph (c)(2) of the Sunshine Act, and in accordance with a
Rebecca Cokley, NCD Executive Director, 1331 F Street NW., Suite 850, Washington, DC 20004; 202-272-2004 (V), 202-272-2074 (TTY).
Nuclear Regulatory Commission.
Determination of inspections, tests, analyses, and acceptance criteria completion.
The U.S. Nuclear Regulatory Commission (NRC) staff has determined that the inspections, tests, and analyses have been successfully completed, and that the specified acceptance criteria are met for Inspections, Tests, Analyses, and Acceptance Criteria (ITAAC), 2.1.03.11 for the Vogtle Electric Generating Plant, Unit 3.
Please refer to Docket ID NRC-2008-0252 when contacting the NRC about the availability of information regarding this document. You may access publicly-available information related to this action by the following methods:
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•
•
David H. Jaffe, Office of New Reactors, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001; telephone: 301-415-1439, email:
On August 1, 2013, Southern Nuclear Operating Company, Inc. (the licensee) submitted an ITAAC closure notification (ICN) under § 52.99(c)(1) of Title 10 of the
The NRC staff has determined that the inspections, tests, and analyses have been successfully completed, and that the specified acceptance criteria are met for Vogtle Electric Generating Plant, Unit 3, ITAAC 2.1.03.11. This notice fulfills the staff's obligations under 10 CFR 52.99(e)(1) to publish a notice in the
The documentation of the NRC staff's determination is in the ITAAC Closure Verification Evaluation Form (VEF), dated September 24, 2013 (ADAMS Accession No. ML13274A279). The VEF is a form that represents the NRC staff's structured process for reviewing ICNs. The ICN presents a narrative description of how the ITAAC was completed, and the NRC's ICN review process involves a determination on whether, among other things, (1) the ICN provides sufficient information, including a summary of the methodology used to perform the ITAAC, to demonstrate that the inspections, tests, and analyses have been successfully completed; (2) the ICN provides sufficient information to demonstrate that the acceptance criteria are met; and (3) any inspections for the ITAAC have been completed and any ITAAC findings associated with the ITAAC have been closed.
The NRC staff's determination of the successful completion of this ITAAC is based on information available at this time and is subject to the licensee's ability to maintain the condition that the acceptance criteria are met. If new information disputes the NRC staff's determination, this ITAAC will be reopened as necessary. The NRC staff's determination will be used to support a subsequent finding, pursuant to 10 CFR 52.103(g), at the end of construction that all acceptance criteria in the combined license are met. The ITAAC closure process is not finalized for this ITAAC until the NRC makes an affirmative finding under 10 CFR 52.103(g). Any future updates to the status of this ITAAC will be reflected on the NRC's Web site at
For the Nuclear Regulatory Commission.
The ACRS Subcommittee on Planning and Procedures will hold a meeting on November 6, 2013, Room T-2B3, 11545 Rockville Pike, Rockville, Maryland.
The meeting will be open to public attendance with the exception of a portion that may be closed pursuant to 5 U.S.C. 552b (c)(2) and (6) to discuss organizational and personnel matters that relate solely to the internal personnel rules and practices of the ACRS, and information the release of which would constitute a clearly unwarranted invasion of personal privacy.
The agenda for the subject meeting shall be as follows:
The Subcommittee will discuss proposed ACRS activities and related matters. The Subcommittee will gather
Members of the public desiring to provide oral statements and/or written comments should notify the Designated Federal Official (DFO), Quynh Nguyen (Telephone 301-415-5844 or Email:
Information regarding changes to the agenda, whether the meeting has been canceled or rescheduled, and the time allotted to present oral statements can be obtained by contacting the identified DFO. Moreover, in view of the possibility that the schedule for ACRS meetings may be adjusted by the Chairman as necessary to facilitate the conduct of the meeting, persons planning to attend should check with the DFO if such rescheduling would result in a major inconvenience.
If attending this meeting, please enter through the One White Flint North building, 11555 Rockville Pike, Rockville, MD. After registering with security, please contact Mr. Theron Brown (240-888-9835) to be escorted to the meeting room.
The ACRS Subcommittee on Fukushima will hold a meeting on November 5, 2013, Room T-2B1, 11545 Rockville Pike, Rockville, Maryland.
The entire meeting will be open to public attendance.
The agenda for the subject meeting shall be as follows:
The Subcommittee will review and discuss options for addressing the Near Term Task Force (NTTF) Recommendation 1: Enhanced Regulatory Framework. The Subcommittee will hear presentations by and hold discussions with the NRC staff, the Nuclear Energy Institute, and other interested persons regarding this matter. The Subcommittee will gather information, analyze relevant issues and facts, and formulate proposed positions and actions, as appropriate, for deliberation by the Full Committee.
Members of the public desiring to provide oral statements and/or written comments should notify the Designated Federal Official (DFO), Michael Snodderly (Telephone 301-415-2241 or Email:
Detailed meeting agendas and meeting transcripts are available on the NRC Web site at
If attending this meeting, please enter through the One White Flint North building, 11555 Rockville Pike, Rockville, MD. After registering with security, please contact Mr. Theron Brown (Telephone 240-888-9835) to be escorted to the meeting room.
The ACRS Subcommittee on U.S. Evolutionary Power Reactor (U.S. EPR) will hold a meeting on November 6, 2013, Room T-2B1, 11545 Rockville Pike, Rockville, Maryland.
The meeting will be open to public attendance with the exception of a portion that may be closed to protection information that is proprietary pursuant to 5 U.S.C. 552(c)(4).
The agenda for the subject meeting shall be as follows:
The Subcommittee will review and discuss the Open Items for Chapter 9 and portions of Chapter 2 (Section 2.4) for the Calvert Cliffs Combined License Application (COLA) NRC Safety Evaluation Report (SER) with open items 0. The Subcommittee will hear presentations by and hold discussions with the NRC staff, Unistar Nuclear Operating Services, and other interested persons regarding this matter. The Subcommittee will gather information, analyze relevant issues and facts, and formulate proposed positions and actions, as appropriate, for deliberation by the Full Committee.
Members of the public desiring to provide oral statements and/or written comments should notify the Designated Federal Official (DFO), Kathy Weaver (Telephone 301-415-6236 or Email:
Detailed meeting agendas and meeting transcripts are available on the NRC Web site at
If attending this meeting, please enter through the One White Flint North building, 11555 Rockville Pike, Rockville, MD. After registering with security, please contact Mr. Theron Brown (Telephone 240-888-9835) to be escorted to the meeting room.
In accordance with the purposes of Sections 29 and 182b of the Atomic Energy Act (42 U.S.C. 2039, 2232b), the Advisory Committee on Reactor Safeguards (ACRS) will hold a meeting on November 7-8, 2013, 11545 Rockville Pike, Rockville, Maryland.
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Procedures for the conduct of and participation in ACRS meetings were published in the
Thirty-five hard copies of each presentation or handout should be provided 30 minutes before the meeting. In addition, one electronic copy of each presentation should be emailed to the Cognizant ACRS Staff one day before meeting. If an electronic copy cannot be provided within this timeframe, presenters should provide the Cognizant ACRS Staff with a CD containing each presentation at least 30 minutes before the meeting.
In accordance with Subsection 10(d) Public Law 92-463, and 5 U.S.C. 552b(c), certain portions of this meeting may be closed, as specifically noted above. Use of still, motion picture, and television cameras during the meeting may be limited to selected portions of the meeting as determined by the Chairman. Electronic recordings will be permitted only during the open portions of the meeting.
ACRS meeting agenda, meeting transcripts, and letter reports are available through the NRC Public Document Room at
Video teleconferencing service is available for observing open sessions of ACRS meetings. Those wishing to use this service should contact Mr. Theron Brown, ACRS Audio Visual Technician (301-415-8066), between 7:30 a.m. and 3:45 p.m. (ET), at least 10 days before the meeting to ensure the availability of this service. Individuals or organizations requesting this service will be responsible for telephone line charges and for providing the equipment and facilities that they use to establish the video teleconferencing link. The availability of video teleconferencing services is not guaranteed.
Office of Personnel Management.
30-Day Notice and request for comments.
In accordance with the Paperwork Reduction Act of 1995 (Pub. L. 104-13, May 22, 1995), this notice announces the Office of Personnel Management's (OPM) plan to submit to the Office of Management and Budget (OMB) a request for clearance of a revised information collection, Standard Form (SF) 15, Application for 10-Point Veteran Preference. The SF-15 is used by agencies, OPM examining offices, and agency appointing officials to adjudicate individuals' claims for veterans' preference in accordance with the Veterans' Preference Act of 1944. OPM's revisions will (1) remove obsolete items; and (2) update language as a result of the enactment of the VOW (Veterans Opportunity to Work) to Hire Heroes Act of 2011 (Pub. L. 112-56). The SF-15 will be revised to create a PDF fillable form for applicant use. The only acceptable version of this form will be as stated above, but consistent with current practice, the form may be submitted electronically or in hard copy. Upon publication, please destroy any prior versions you have in stock. The SF-15 will be obtainable on the OPM Web site at
1. Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of OPM, including whether the information will have practical utility;
2. Evaluate the accuracy of OPM's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
3. Enhance the quality, utility, and clarity of the information to be collected; and
4. Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submissions of responses.
Comments are encouraged and will be accepted until November 29, 2013. This process is conducted in accordance with 5 CFR 1320.1.
Interested persons are invited to submit written comments on the proposed information collection by mail to the Office of Information and Regulatory Affairs, Office of Management Budget, 725 17th Street NW., Washington, DC 20503, Attention: Desk Officer for the Office of Personnel Management, by email to
A copy of this Information Collection Request (ICR), with applicable supporting documentation, may be obtained by contacting the Office of Information and Regulatory Affairs, Office of Management Budget, 725 17th Street NW., Washington, DC 20503, Attention: Desk Officer for the Office of Personnel Management or sent via electronic mail to
Office of Personnel Management.
Cancelling and Re-Scheduling of Council Meetings.
The Hispanic Council on Federal Employment (Council) is cancelling the October 31, 2013 Council meeting and will hold its remaining 2013 Council meeting on the date and location shown below. The Council is an advisory committee composed of representatives from Hispanic organizations and senior government officials. Along with its other responsibilities, the Council shall advise the Director of the Office of Personnel Management on matters involving the recruitment, hiring, and advancement of Hispanics in the Federal workforce. The Council is co-chaired by the Chief of Staff of the Office of Personnel Management and the Chair of the National Hispanic Leadership Agenda (NHLA).
The meeting is open to the public. Please contact the Office of Personnel Management at the address shown below if you wish to present material to the Council at any of the meetings. The manner and time prescribed for presentations may be limited, depending upon the number of parties that express interest in presenting information.
December 12, 2013 from 2:00 p.m.-4:00 p.m.
Veronica E. Villalobos, Director for the Office of Diversity and Inclusion, Office of Personnel Management, 1900 E St. NW., Suite 5H35, Washington, DC 20415. Phone (202) 606-0020, FAX (202) 606-2183 or email at
U.S. Office of Personnel Management (OPM).
Notice of a new system of records.
The U.S. Office of Personnel Management (OPM) proposes to add OPM/Central-19: External Review Records for Multi-State Plan (MSP) Program to its inventory of records systems subject to the Privacy Act of 1974 (5 U.S.C. 552a), as amended. This action is necessary to meet the requirements of the Privacy Act to publish in the
This action will be effective without further notice on December 9, 2013 unless comments are received that would result in a contrary determination.
Send written comments to the Office of Personnel Management, ATTN: Padma Shah, U.S. Office of Personnel Management, 1900 E Street NW., Room 2347, Washington, DC 20415.
Padma Shah by telephone at 202-606-2128, or by email at
The Patient Protection and Affordable Care Act, Public Law 111-148, was enacted on March 23, 2010, and the Health Care and Education Reconciliation Act, Public Law 111-152, was enacted on March 30, 2010 (collectively referred to as “the Affordable Care Act”).
Section 1334 of the Affordable Care Act and its implementing regulations (codified at 45 CFR part 800) direct OPM to establish the Multi-State Plan (MSP) Program to foster competition among plans offering coverage on the individual and small group health insurance markets on the Affordable Insurance Exchanges (referred to as “Exchanges” or “Health Insurance Marketplaces”). Specifically, OPM must contract with private health insurance issuers to offer at least two MSP options on each of the Exchanges in the 50 States and the District of Columbia, in which issuers may phase in coverage over a period of 4 years.
Under section 1334(a)(4) of the Affordable Care Act, OPM must administer the MSP Program “in a manner similar to the manner in which” it implements the contracting provisions of the Federal Employees Health Benefits (FEHB) Program under 5 U.S.C. 8901
The purpose of this system of records is to provide a central database through which OPM may conduct external review of adverse benefit determinations under the MSP Program, refer MSP enrollees to other entities about their inquiries or complaints, and correspond with MSP enrollees. OPM will collect, manage, and analyze health services data that MSP enrollees, MSP issuers, health care providers, and others will furnish through secure data transfer. The information contained in the database will help ensure that (1) MSP enrollees have adequate access to independent review of adverse benefit determinations, (2) MSP enrollees are referred to appropriate entities about their inquiries or complaints, (3) OPM corresponds with MSP enrollees, and (4) OPM collects the information necessary for the enforcement of MSP Program contracts and implementation of the program.
OPM will use identifiable data to create records that are necessary to facilitate external review of MSP issuer adverse benefit determinations by OPM analysts and independent review organizations. Likewise, OPM will use identifiable data to create records about MSP enrollee inquiries or complaints, which may have to be referred to other State and Federal Government agencies. However, OPM and external analysts using the database for analysis purposes will have access only to de-identified data.
External Review Records for Multi-State Plan (MSP) Program
Office of Personnel Management, 1900 E Street NW., Washington, DC 20415.
This system will contain records on MSP enrollees who request external review of adverse benefit determinations, and MSP enrollees who contact OPM about an inquiry or complaint.
In order to process a request for external review, OPM may require an MSP enrollee or an authorized representative to submit the following information about the enrollee, which OPM may also collect, as necessary, to process enrollee inquiries and complaints:
a. The adverse benefit determination that the individual received from the MSP issuer.
b. Name.
c. Date of birth.
d. Gender.
e. Social Security Number.
f. Phone number(s), postal address(es) (current and mailing), and email address(es).
g. Insurance identification (ID) number.
h. Group number.
i. Scanned copy of insurance ID card.
j. The State and county of coverage.
k. An indication of whether the external review request is for an urgent claim.
l. A brief statement of the reason for the external review request.
m. The MSP issuer's name.
n. The name of the MSP option that covers the MSP enrollee.
o. The claim number.
p. Subscriber's information: Name, Social Security Number, date of birth, gender, phone number(s), postal address(es) (current and mailing), and email address(es).
q. In cases where an authorized representative requests external review, evidence of authorization and the following information about the authorized representative: name, phone number(s), postal address(es) (current and mailing), and email address(es).
r. Name of health care provider.
s. Health care provider address(es).
t. Any additional information necessary to process the request for external review.
In addition, MSP enrollees may choose to submit additional information that will become part of the system of records. This information may include, but is not limited to, the following:
a. A statement about why the MSP enrollee believes the MSP issuer's adverse benefit determination was wrong, based on specific benefit provisions in the plan brochure, contract, or statement of benefits.
b. Copies of documents that support the request for external review, such as physicians' letters, operative reports, bills, medical records, and explanation of benefits (EOB) forms.
c. Copies of all letters the MSP enrollee sent to the MSP issuer about the claim.
d. Copies of all letters the MSP issuer sent to the MSP enrollee about the claim.
MSP issuers will provide additional information and documentation. Consequently, the records in the system may include the following information about the MSP enrollee:
a. Personal identifying information (name, Social Security Number, date of birth, gender, phone number, etc.).
b. Postal address(es) (current and mailing).
c. Dependent information (spouse, dependents and their addresses).
d. Employment information.
e. Health care provider information.
f. Health care coverage information.
g. Health care procedure information.
h. Health care diagnoses information.
i. Provider charges and reimbursement information on coverage, procedures and diagnoses.
j. Any other letters or other documents submitted in connection with the adverse benefit determination by MSP enrollees, health care providers, or MSP issuers.
The aforementioned information may also be collected, as necessary, to process MSP enrollee inquiries and complaints.
OPM has authority to administer the MSP Program under section 1334 of the Affordable Care Act (42 U.S.C. 18054).
OPM operates this system of records to support the administration of the MSP Program. The primary purpose of this system of records is to aid in the administration of external review of adverse benefit determinations for MSP enrollees. OPM must have the capacity to collect, manage, and access health insurance benefits appeals information and documents on an ongoing basis in order for OPM to:
a. Determine eligibility for the MSP Program external review process.
b. Review adverse benefit determinations by MSP issuers to provide effective external review.
c. Track the progress of individual requests for external review and ensure that MSP enrollees do not submit duplicative requests.
d. Make information available for any subsequent litigation related to a disputed external review decision.
e. Monitor whether MSP issuers are providing benefits to which MSP enrollees are entitled under the terms of the applicable MSP Program contract.
f. Maintain records for parties to the dispute so that the MSP enrollee and MSP issuer can obtain a record of past external reviews in which they were involved.
g. Track and report information about the administration of the MSP Program.
h. Refer MSP enrollees to appropriate entities about their inquiries or complaints.
i. Correspond with MSP enrollees.
In addition to those disclosures otherwise permitted under 5 U.S.C. 552a(b), all or a portion of the records or information contained in this system may be disclosed outside of OPM, for a routine use under 5 U.S.C. 552a(b)(3) as follows:
a. For Claims Adjudication—To disclose information to agency contractors conducting claim reviews for the purpose of adjudicating an appeal.
b. For Law Enforcement Purposes—To disclose pertinent information to the appropriate Federal, State, or local agency responsible for investigating, prosecuting, enforcing, or implementing a statute, rule, regulation, or order, where OPM becomes aware of an indication of a violation or potential violation of civil or criminal law or regulation.
c. For Congressional Inquiry—To provide information to a Congressional office from the record of an individual in response to an inquiry from that Congressional office made at the request of that individual.
d. For Judicial/Administrative Proceedings—To disclose information to another Federal agency, to a court, or a party in litigation before a court or in an administrative proceeding being conducted by a Federal agency, when the Government is a party to the judicial or administrative proceeding. In those cases where the Government is not a party to the processing, records may be disclosed if a subpoena has been signed by a judge.
e. For the National Archives and Records Administration or the General Services Administration—To disclose information to the National Archives and Records Administration (NARA) or General Services Administration for use in records management inspections conducted pursuant to 44 U.S.C. 2904 and 2906.
f. For Litigation—To disclose to the Department of Justice or in a proceeding before a court, adjudicative body, or other administrative body before which OPM is authorized to appear, when—
(1) OPM, or any component thereof; or
(2) Any employee of OPM in his or her official capacity; or
(3) Any employee of OPM in his or her individual capacity where the Department of Justice or OPM has agreed to represent the employee; or
(4) The United States, when OPM determines that litigation is likely to affect OPM or any of its components—
is a party to litigation or has an interest in such litigation, and the use of such records by the Department of Justice or OPM is deemed by OPM to be relevant and necessary to the litigation, provided, however, that the disclosure is compatible with the purpose for which records were collected.
g. For Non-Federal Personnel—To disclose information to contractors, grantees, or volunteers performing or working on a contract, service, grant, cooperative agreement, or job for the Federal Government, where the disclosure is compatible with the purpose for which records are collected.
h. In the Event of a Data Breach—In the event of a data breach, records may be disclosed to appropriate Federal agencies and agency contractors that have a need to know the information for the purpose of assisting the agency's efforts to respond to a suspected or confirmed breach of the security or confidentiality of information maintained in this system of records, and the information disclosed is relevant and necessary for that assistance.
i. To researchers inside and outside the Federal Government, approved in advance by OPM on the basis of demonstrated aptitude and a written research plan, for the purpose of conducting analysis of health care and health insurance trends and topical health-related issues compatible with the purposes for which the records were collected and formulating health care program changes and enhancements to limit cost growth, improve outcomes, increase accountability, and improve efficiency in program administration. In all cases, researchers external to OPM will access a public use file that will be maintained for such purposes; will contain only de-identified data; and will be structured, where appropriate, to protect MSP enrollee confidentiality where identities may be discerned because there are fewer records under certain demographic or other variables. In all disclosures to analysts under this routine use, only de-identified data will be disclosed.
j. If OPM determines that jurisdiction over an MSP enrollee's inquiry or complaint lies with another Federal or State agency, information in this system of records may be disclosed to other agencies, such as a State insurance department, a State Consumer Assistance Program, or the U.S. Department of Health and Human Services.
Paper records will be maintained in locked file cabinets within OPM and/or any contractors. Any electronic records will be maintained in electronic systems.
Records will primarily be manipulated, managed and summarized using a unique number assigned to each external review or case about an inquiry or complaint. However, information may also be accessible by other identifying information, including name, date of birth, or Social Security Number.
OPM will maintain records within its secure headquarters in Washington, DC. Electronic records will be maintained on password-protected computers and systems. Computer firewalls will be maintained to prevent access by unauthorized personnel. Any paper records will be delivered to a locked P.O. Box and kept in locked file cabinets.
Federal employees and employees of Federal contractors are required to have been the subject of a favorable adjudication following an appropriate background investigation before they are allowed physical access to OPM and access to any records. OPM's environment is equipped with electronic badge readers restricting access to authorized personnel only and has safeguards in place to alert security personnel if unauthorized personnel attempt to gain access to OPM's environment. OPM employs armed physical security guards 365 days a year, 24 hours a day, who patrol OPM headquarters, including entry and exit points. Closed Circuit Video cameras are strategically located on every floor and external to the facility.
The system will employ National Institute of Standards and Technology (NIST) Security Controls identified in the most recent version of Special Publication SP 800-53. NIST 800-53 security controls are the management, operational, and technical safeguards or countermeasures employed within an organizational information system to protect the confidentiality, integrity, and availability of the system and its information. OPM will perform a Security Assessment and Authorization (SA&A) following the NIST 800-53 standard in order to obtain an Authority to Operate (ATO). The system will employ role-based access controls to further restrict access to data, based on the functions that users are authorized to perform. The system will be fully compliant with all applicable provisions of the Privacy Act, Health Insurance Portability and Accountability Act (HIPAA), Federal Information Security Management Act (FISMA), Federal Records Act, Office of Management and Budget (OMB) guidance, and NIST guidance.
The records in this system will be retained for at least 6 years. Records may be retained for a longer period for the system purposes established in this system of records notice, or for other purposes as required under law (e.g., for purposes of litigation). A records retention schedule will be established with NARA, and no records will be destroyed until that schedule has been established. Once that schedule is established, it will set forth methods for disposing records that would no longer be eligible for retention.
The system manager is Edward M. DeHarde, U.S. Office of Personnel Management, Healthcare and Insurance, 1900 E Street NW., Room 2347, Washington, DC 20415.
Individuals wishing to determine whether this system of records contains information about them may do so by writing to the U.S. Office of Personnel Management, FOIA/PA Requester Service Center, 1900 E Street NW., Room 5415, Washington, DC 20415-7900 or by emailing
Individuals must furnish the following information for their records to be located:
1. Full name.
2. Date and place of birth.
3. Social Security Number.
4. Signature.
5. Available information regarding the type of information requested, including the name of the MSP issuer involved in any external review and the approximate date of the request for external review.
6. The reason why the individual believes this system contains information about him/her.
7. The address to which the information should be sent.
Individuals requesting access must also comply with OPM's Privacy Act regulations regarding verification of identity and access to records (5 CFR part 297). In addition, the requester must provide a notarized statement or an unsworn declaration made in accordance with 28 U.S.C. 1746, in the following format:
• If executed outside the United States: “I declare (or certify, verify, or state) under penalty of perjury under the laws of the United States of America that the foregoing is true and correct. Executed on [date]. [Signature].”
• If executed within the United States, its territories, possessions, or commonwealths: “I declare (or certify, verify, or state) under penalty of perjury that the foregoing is true and correct. Executed on [date]. [Signature].”
Individuals wishing to request amendment of records about them should write to the U.S. Office of Personnel Management, FOIA/PA Requester Service Center, 1900 E Street NW., Room 5415, Washington, DC 20415-7900. ATTN: Healthcare and Insurance, National Healthcare Operations.
Individuals must furnish the following information in writing for their records to be located:
1. Full name.
2. Date and place of birth.
3. Social Security Number.
4. Signature.
5. Available information regarding the type of information that the individual seeks to have amended, including the name of the MSP issuer involved in any external review and the approximate date of the request for external review.
Individuals requesting access must also comply with OPM's Privacy Act regulations regarding verification of identity and access to records (5 CFR part 297). In addition, the requester must provide a notarized statement or an unsworn declaration made in accordance with 28 U.S.C. 1746, in the following format:
• If executed outside the United States: “I declare (or certify, verify, or state) under penalty of perjury under the laws of the United States of America that the foregoing is true and correct. Executed on [date]. [Signature].”
• If executed within the United States, its territories, possessions, or commonwealths: “I declare (or certify, verify, or state) under penalty of perjury that the foregoing is true and correct. Executed on [date]. [Signature].”
Information in this system of records is obtained from:
a. MSP enrollees who request external review, or who contact OPM about an inquiry or complaint.
b. Authorized representatives of MSP enrollees.
c. Health care providers.
d. MSP issuers.
e. Medical professionals providing expert medical review under contract with OPM.
None.
Postal Regulatory Commission.
Notice.
The Commission is noticing a recent Postal Service filing concerning the addition of Priority Mail Express & Priority Mail Contract 15 to the competitive product list. This notice informs the public of the filing, invites public comment, and takes other administrative steps.
Submit comments electronically via the Commission's Filing Online system at
Stephen L. Sharfman, General Counsel, at 202-789-6820.
In accordance with 39 U.S.C. 3642 and 39 CFR 3020.30
The Postal Service contemporaneously filed a redacted contract related to the proposed new product under 39 U.S.C. 3632(b)(3) and 39 CFR 3015.5.
• Attachment A—a redacted copy of Governors' Decision No. 11-6, authorizing the new product;
• Attachment B—a redacted copy of the contract;
• Attachment C—proposed changes to the Mail Classification Schedule competitive product list with the addition underlined;
• Attachment D—a Statement of Supporting Justification as required by 39 CFR 3020.32;
• Attachment E—a certification of compliance with 39 U.S.C. 3633(a); and
• Attachment F—an application for non-public treatment of materials to maintain redacted portions of the contract and related financial information under seal.
In the Statement of Supporting Justification, Brian Code, Manager, Retail Alliances, asserts that the contract will cover its attributable costs, make a positive contribution to coverage of institutional costs, and increase contribution toward the requisite 5.5 percent of the Postal Service's total institutional costs.
The Postal Service filed much of the supporting materials, including the related contract, under seal.
The Commission establishes Docket Nos. MC2014-3 and CP2014-3 to consider the Request pertaining to the proposed Priority Mail Express & Priority Mail Contract 15 product and the related contract, respectively.
Interested persons may submit comments on whether the Postal Service's filings in the captioned dockets are consistent with the policies of 39 U.S.C. 3632, 3633, or 3642, 39 CFR 3015.5, and 39 CFR part 3020, subpart B. Comments are due no later than October 31, 2013. The public portions of these filings can be accessed via the Commission's Web site (
The Commission appoints Curtis E. Kidd to serve as Public Representative in these dockets.
1. The Commission establishes Docket Nos. MC2014-3 and CP2014-3 to consider the matters raised in each docket.
2. Pursuant to 39 U.S.C. 505, Curtis E. Kidd is appointed to serve as an officer of the Commission (Public Representative) to represent the interests of the general public in these proceedings.
3. Comments by interested persons in these proceedings are due no later than October 31, 2013.
4. The Secretary shall arrange for publication of this order in the
By the Commission.
Postal Regulatory Commission.
Notice.
The Commission is noticing recent Postal Service filings requesting the addition of Parcel Return Service Contract 5 to the competitive product list. This notice informs the public of the filings, invites public comment, and takes other administrative steps.
Submit comments electronically via the Commission's Filing Online system at
Stephen L. Sharfman, General Counsel, at 202-789-6820.
In accordance with 39 U.S.C. 3642 and 39 CFR 3020.30
The Postal Service contemporaneously filed a redacted contract related to the proposed new product.
• Attachment A—a redacted copy of Governors' Decision No. 11-6, authorizing the new product;
• Attachment B—a redacted copy of the contract;
• Attachment C—proposed changes to the Mail Classification Schedule competitive product list with the addition underlined;
• Attachment D—a Statement of Supporting Justification as required by 39 CFR 3020.32;
• Attachment E—a certification of compliance with 39 U.S.C. 3633(a); and
• Attachment F—an application for non-public treatment of materials to maintain redacted portions of the contract and related financial information under seal.
In the Statement of Supporting Justification, Dennis R. Nicoski, Manager, Field Sales Strategy and Contracts, asserts that the contract will cover its attributable costs and increase contribution toward the requisite 5.5 percent of the Postal Service's total institutional costs.
The Postal Service filed much of the supporting materials, including the related contract, under seal.
The Commission establishes Docket Nos. MC2014-4 and CP2014-4 to consider the Request pertaining to the proposed Parcel Return Service Contract 5 product and the related contract, respectively.
Interested persons may submit comments on whether the Postal Service's filings in the captioned dockets are consistent with the policies of 39 U.S.C. 3632, 3633, or 3642, 39 CFR 3015.5, and 39 CFR Part 3020, subpart B. Comments are due no later than October 31, 2013. The public portions of these filings can be accessed via the Commission's Web site (
The Commission appoints Lyudmila Y. Bzhilyanskaya to serve as Public Representative in these dockets.
1. The Commission establishes Docket Nos. MC2014-4 and CP2014-4 to consider the matters raised in each docket.
2. Pursuant to 39 U.S.C. 505, Lyudmila Y. Bzhilyanskaya is appointed
3. Comments by interested persons in these proceedings are due no later than October 31, 2013.
4. The Secretary shall arrange for publication of this order in the
By the Commission.
Postal Regulatory Commission.
Notice.
The Commission is noticing recent Postal Service filings requesting the addition of Priority Mail Contract 66 to the competitive product list. This notice informs the public of the filings, invites public comment, and takes other administrative steps.
Submit comments electronically via the Commission's Filing Online system at
Stephen L. Sharfman, General Counsel, at 202-789-6820.
In accordance with 39 U.S.C. 3642 and 39 CFR 3020.30
The Postal Service contemporaneously filed a redacted contract related to the proposed new product.
• Attachment A—a redacted copy of Governors' Decision No. 11-6, authorizing the new product;
• Attachment B—a redacted copy of the contract;
• Attachment C—proposed changes to the Mail Classification Schedule competitive product list with the addition underlined;
• Attachment D—a Statement of Supporting Justification as required by 39 CFR 3020.32;
• Attachment E—a certification of compliance with 39 U.S.C. 3633(a); and
• Attachment F—an application for non-public treatment of materials to maintain redacted portions of the contract and related financial information under seal.
In the Statement of Supporting Justification, Dennis R. Nicoski, Manager, Field Sales Strategy and Contracts, asserts that the contract will cover its attributable costs and increase contribution toward the requisite 5.5 percent of the Postal Service's total institutional costs.
The Postal Service filed much of the supporting materials, including the related contract, under seal.
The Commission establishes Docket Nos. MC2014-2 and CP2014-2 to consider the Request pertaining to the proposed Priority Mail Contract 66 product and the related contract, respectively.
Interested persons may submit comments on whether the Postal Service's filings in the captioned dockets are consistent with the policies of 39 U.S.C. 3632, 3633, or 3642, 39 CFR 3015.5, and 39 CFR part 3020, subpart B. Comments are due no later than October 31, 2013. The public portions of these filings can be accessed via the Commission's Web site (
The Commission appoints Pamela A. Thompson to serve as Public Representative in these dockets.
1. The Commission establishes Docket Nos. MC2014-2 and CP2014-2 to consider the matters raised in each docket.
2. Pursuant to 39 U.S.C. 505, Pamela A. Thompson is appointed to serve as an officer of the Commission (Public Representative) to represent the interests of the general public in these proceedings.
3. Comments by interested persons in these proceedings are due no later than October 31, 2013.
4. The Secretary shall arrange for publication of this order in the
By the Commission.
Securities and Exchange Commission (“Commission”).
Notice of an application for an order under section 6(c) of the Investment Company Act of 1940 (“Act”) for an exemption from sections 2(a)(32), 5(a)(1), 22(d) and 22(e) of the Act and rule 22c-1 under the Act, under sections 6(c) and 17(b) of the Act for an exemption from sections 17(a)(1) and (a)(2) of the Act, and under section 12(d)(1)(J) of the Act for an exemption from sections 12(d)(1)(A) and (B) of the Act.
VTL Associates, LLC (“VTL”), RevenueShares ETF Trust (the “Trust”), and Foreside Fund Services, LLC (the “Distributor”).
Applicants request an order that permits: (a) Actively-managed series of certain open-end management investment companies to issue shares (“Shares”) redeemable in large aggregations only (“Creation Units”); (b) secondary market transactions in Shares to occur at negotiated market prices; (c) certain series to pay redemption proceeds, under certain circumstances, more than seven days from the tender of Shares for redemption; (d) certain affiliated persons of the series to deposit securities into, and receive securities from, the series in connection with the purchase and redemption of Creation Units; and (e) certain registered management investment companies and unit investment trusts outside of the same group of investment companies as the series to acquire Shares.
An order granting the requested relief will be issued unless the Commission orders a hearing. Interested persons may request a hearing by writing to the Commission's Secretary and serving applicants with a copy of the request, personally or by mail. Hearing requests should be received by the Commission by 5:30 p.m. on November 18, 2013, and should be accompanied by proof of service on applicants, in the form of an affidavit or, for lawyers, a certificate of service. Hearing requests should state the nature of the writer's interest, the reason for the request, and the issues contested. Persons who wish to be notified of a hearing may request notification by writing to the Commission's Secretary.
Elizabeth M. Murphy, Secretary, U.S. Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090. Applicants: VTL and the Trust: Vincent T. Lowry, VTL Associates, LLC, One Commerce Square, 2005 Market Street, Suite 2020, Philadelphia, PA 19103; Distributor: Foreside Fund Services, LLC, Three Canal Plaza, Suite 100, Portland, ME 04101.
Deepak T. Pai, Senior Counsel, at (202) 551-6876 or Daniele Marchesani, Branch Chief, at (202) 551-6821 (Division of Investment Management, Exemptive Applications Office).
The following is a summary of the application. The complete application may be obtained via the Commission's Web site by searching for the file number, or for an applicant using the Company name box, at
1. The Trust is registered as an open-end management investment company under the Act and is a statutory trust organized under the laws of Delaware. The Trust initially will offer one series, the RevenueShares Active Navellier Overall A-100 Fund (the “Initial Fund”), which applicants state will seek long-term capital growth. The Initial Fund will seek to achieve its investment objective by investing primarily in equity securities listed on North American exchanges.
2. VTL, a Pennsylvania limited liability company, is registered as an investment adviser under the Investment Advisers Act of 1940 (“Advisers Act”) and will serve as investment adviser to the Initial Fund. The Advisor (as defined below) may in the future retain one or more sub-advisors (each a “Sub-Advisor”) to manage the portfolios of the Funds (as defined below). Any Sub-Advisor will be registered, or not subject to registration, under the Advisers Act. The Distributor is a registered broker-dealer (“Broker”) under the Securities Exchange Act of 1934 (“Exchange Act”) and will act as the distributor and principal underwriter of the Funds.
3. Applicants request that the order apply to the Initial Fund and any future series of the Trust as well as other open-end management companies that may utilize active management investment strategies (“Future Funds”). Any Future Fund will (a) be advised by VTL or an entity controlling, controlled by, or under common control with VTL (VTL and each such other entity and any successor thereto included in the term “Advisor”),
4. Applicants also request that any exemption under section 12(d)(1)(J) of the Act from sections 12(d)(1)(A) and (B) apply to: (i) Any Fund that is currently or subsequently part of the same “group of investment companies” as the Initial Fund within the meaning
5. Applicants anticipate that a Creation Unit will consist of at least 50,000 Shares. Applicants anticipate that the trading price of a Share will range from $10 to $100. All orders to purchase Creation Units must be placed with the Distributor by or through a party that has entered into a participant agreement with the Distributor and the transfer agent of the Fund (“Authorized Participant”) with respect to the creation and redemption of Creation Units. An Authorized Participant is either: (a) A Broker or other participant in the Continuous Net Settlement System of the National Securities Clearing Corporation (“NSCC”), a clearing agency registered with the Commission and affiliated with the Depository Trust Company (“DTC”), or (b) a participant in the DTC (such participant, “DTC Participant”).
6. In order to keep costs low and permit each Fund to be as fully invested as possible, Shares will be purchased and redeemed in Creation Units and generally on an in-kind basis. Except where the purchase or redemption will include cash under the limited circumstances specified below, purchasers will be required to purchase Creation Units by making an in-kind deposit of specified instruments (“Deposit Instruments”), and shareholders redeeming their Shares will receive an in-kind transfer of specified instruments (“Redemption Instruments”).
7. Purchases and redemptions of Creation Units may be made in whole or in part on a cash basis, rather than in kind, solely under the following circumstances: (a) To the extent there is a Cash Amount, as described above; (b) if, on a given Business Day, a Fund announces before the open of trading that all purchases, all redemptions or all purchases and redemptions on that day will be made entirely in cash; (c) if, upon receiving a purchase or redemption order from an Authorized Participant, a Fund determines to require the purchase or redemption, as applicable, to be made entirely in cash; (d) if, on a given Business Day, a Fund requires all Authorized Participants purchasing or redeeming Shares on that day to deposit or receive (as applicable) cash in lieu of some or all of the Deposit Instruments or Redemption Instruments, respectively, solely because: (i) such instruments are not eligible for transfer through either the NSCC or DTC; or (ii) in the case of Funds holding non-U.S. investment (“Global Funds”), such instruments are not eligible for trading due to local trading restrictions, local restrictions on securities transfers or other similar circumstances; or (e) if a Fund permits an Authorized Participant to deposit or receive (as applicable) cash in lieu of some or all of the Deposit Instruments or Redemption Instruments, respectively, solely because: (i) such instruments are, in the case of the purchase of a Creation Unit, not available in sufficient quantity; (ii) such instruments are not eligible for trading by an Authorized Participant or the investor on whose behalf the Authorized Participant is acting; or (iii) a holder of Shares of a Global Fund would be subject to unfavorable income tax treatment if the holder receives redemption proceeds in kind.
8. Each Business Day, before the open of trading on a national securities exchange, as defined in section 2(a)(26) of the Act (“Stock Exchange”), on which Shares are listed, each Fund will cause to be published through the NSCC the names and quantities of the instruments comprising the Creation Basket, as well as the estimated Cash Amount (if any), for that day. The published Creation Basket will apply until a new Creation Basket is announced on the following Business Day, and there will be no intra-day changes to the Creation Basket except to correct errors in the published Creation Basket. The Stock Exchange will disseminate every 15 seconds throughout the trading day an amount representing, on a per Share basis, the sum of the current value of the Portfolio Instruments that were publicly disclosed prior to the commencement of trading in Shares on the Stock Exchange.
9. A Fund may recoup the settlement costs charged by NSCC and DTC by imposing a transaction fee on investors purchasing or redeeming Creation Units (the “Transaction Fee”). The Transaction Fee will be borne only by purchasers and redeemers of Creation Units and will be limited to amounts that have been determined appropriate
10. Shares will be listed and traded at negotiated prices on a Stock Exchange and traded in the secondary market. Applicants expect that Stock Exchange specialists or market makers (“Market Makers”) will be assigned to Shares. The price of Shares trading on the Stock Exchange will be based on a current bid/offer in the secondary market. Transactions involving the purchases and sales of Shares on the Stock Exchange will be subject to customary brokerage commissions and charges.
11. Applicants expect that purchasers of Creation Units will include institutional investors and arbitrageurs. Market Makers, acting in their unique role to provide a fair and orderly secondary market for Shares, also may purchase Creation Units for use in their own market making activities.
12. Shares will not be individually redeemable and owners of Shares may acquire those Shares from a Fund, or tender such shares for redemption to the Fund, in Creation Units only. To redeem, an investor must accumulate enough Shares to constitute a Creation Unit. Redemption requests must be placed by or through an Authorized Participant.
13. Neither the Trust nor any Fund will be marketed or otherwise held out as a “mutual fund”. Instead, each Fund will be marketed as an “actively-managed exchange-traded fund”. In any advertising material where features of obtaining, buying or selling Shares traded on the Stock Exchange are described there will be an appropriate statement to the effect that Shares are not individually redeemable.
14. The Funds' Web site, which will be publicly available prior to the public offering of Shares, will include a Prospectus and additional quantitative information updated on a daily basis, including, on a per Share basis for each Fund, the prior Business Day's NAV and the market closing price or mid-point of the bid/ask spread at the time of the calculation of such NAV (“Bid/Ask Price”), and a calculation of the premium or discount of the market closing price or Bid/Ask Price against such NAV. On each Business Day, before commencement of trading in Shares on the Stock Exchange, the Fund will disclose on its Web site the identities and quantities of the Portfolio Instruments held by the Fund that will form the basis for the Fund's calculation of NAV at the end of the Business Day.
1. Applicants request an order under section 6(c) of the Act for an exemption from sections 2(a)(32), 5(a)(1), 22(d) and 22(e) of the Act and rule 22c-1 under the Act, under sections 6(c) and 17(b) of the Act for an exemption from sections 17(a)(1) and 17(a)(2) of the Act, and under section 12(d)(1)(J) of the Act for an exemption from sections 12(d)(1)(A) and (B) of the Act.
2. Section 6(c) of the Act provides that the Commission may exempt any person, security or transaction, or any class of persons, securities or transactions, from any provisions of the Act, if and to the extent that such exemption is necessary or appropriate in the public interest and consistent with the protection of investors and the purposes fairly intended by the policy and provisions of the Act. Section 17(b) of the Act authorizes the Commission to exempt a proposed transaction from section 17(a) of the Act if evidence establishes that the terms of the transaction, including the consideration to be paid or received, are reasonable and fair and do not involve overreaching on the part of any person concerned, and the proposed transaction is consistent with the policies of the registered investment company and the general provisions of the Act. Section 12(d)(1)(J) of the Act provides that the Commission may exempt any person, security, or transaction, or any class or classes of persons, securities or transactions, from any provision of section 12(d)(1) if the exemption is consistent with the public interest and the protection of investors.
3. Section 5(a)(1) of the Act defines an “open-end company” as a management investment company that is offering for sale or has outstanding any redeemable security of which it is the issuer. Section 2(a)(32) of the Act defines a redeemable security as any security, other than short-term paper, under the terms of which the holder, upon its presentation to the issuer, is entitled to receive approximately a proportionate share of the issuer's current net assets, or the cash equivalent. Because Shares will not be individually redeemable, applicants request an order that would permit each Fund to redeem Shares in Creation Units only. Applicants state that investors may purchase Shares in Creation Units from each Fund and redeem Creation Units from each Fund. Applicants further state that because the market price of Creation Units will be disciplined by arbitrage opportunities, investors should be able to sell Shares in the secondary market at prices that do not vary materially from their NAV.
4. Section 22(d) of the Act, among other things, prohibits a dealer from selling a redeemable security that is currently being offered to the public by or through a principal underwriter, except at a current public offering price described in the prospectus. Rule 22c-
5. Applicants assert that the concerns sought to be addressed by section 22(d) of the Act and rule 22c-1 under the Act with respect to pricing are equally satisfied by the proposed method of pricing Shares. Applicants maintain that while there is little legislative history regarding section 22(d), its provisions, as well as those of rule 22c-1, appear to have been designed to (a) Prevent dilution caused by certain riskless-trading schemes by principal underwriters and contract dealers, (b) prevent unjust discrimination or preferential treatment among buyers resulting from sales at different prices, and (c) assure an orderly distribution system of investment company shares by eliminating price competition from brokers offering shares at less than the published sales price and repurchasing shares at more than the published redemption price.
6. Applicants believe that none of these purposes will be thwarted by permitting Shares to trade in the secondary market at negotiated prices. Applicants state that (a) secondary market trading in Shares does not involve the Funds as parties and cannot result in dilution of an investment in Shares, and (b) to the extent different prices exist during a given trading day, or from day to day, such variances occur as a result of third-party market forces, such as supply and demand. Therefore, applicants assert that secondary market transactions in Shares will not lead to discrimination or preferential treatment among purchasers. Finally, applicants contend that the proposed distribution system will be orderly because arbitrage activity should ensure that the difference between the market price of Shares and their NAV remains narrow.
7. Section 22(e) of the Act generally prohibits a registered investment company from suspending the right of redemption or postponing the date of payment of redemption proceeds for more than seven days after the tender of a security for redemption. Applicants observe that settlement of redemptions of Creation Units of Global Funds is contingent not only on the settlement cycle of the U.S. securities markets but also on the delivery cycles present in foreign markets in which those Funds invest. Applicants have been advised that, under certain circumstances, the delivery cycles for transferring Portfolio Instruments to redeeming investors, coupled with local market holiday schedules, will require a delivery process of up to 14 calendar days. Applicants therefore request relief from section 22(e) in order to provide payment or satisfaction of redemptions within the maximum number of calendar days required for such payment or satisfaction in the principal local markets where transactions in the Portfolio Instruments of each Global Fund customarily clear and settle, but in all cases no later than 14 calendar days following the tender of a Creation Unit.
8. Applicants state that section 22(e) was designed to prevent unreasonable, undisclosed and unforeseen delays in the actual payment of redemption proceeds. Applicants assert that the requested relief will not lead to the problems that section 22(e) was designed to prevent. Applicants state that allowing redemption payments for Creation Units of a Fund to be made within a maximum of 14 calendar days would not be inconsistent with the spirit and intent of section 22(e). Applicants state each Global Fund's statement of additional information (“SAI”) will disclose those local holidays (over the period of at least one year following the date of the SAI), if any, that are expected to prevent the delivery of redemption proceeds in seven calendar days and the maximum number of days needed to deliver the proceeds for each affected Global Fund. Applicants are not seeking relief from section 22(e) with respect to Global Funds that do not effect redemptions in-kind.
9. Section 12(d)(1)(A) of the Act prohibits a registered investment company from acquiring shares of an investment company if the securities represent more than 3% of the total outstanding voting stock of the acquired company, more than 5% of the total assets of the acquiring company, or, together with the securities of any other investment companies, more than 10% of the total assets of the acquiring company. Section 12(d)(1)(B) of the Act prohibits a registered open-end investment company, its principal underwriter, or any other broker or dealer from selling its shares to another investment company if the sale will cause the acquiring company to own more than 3% of the acquired company's voting stock, or if the sale will cause more than 10% of the acquired company's voting stock to be owned by investment companies generally.
10. Applicants request relief to permit Investing Funds to acquire Shares in excess of the limits in section 12(d)(1)(A) of the Act and to permit the Funds, their principal underwriters and any Broker to sell Shares to Investing Funds in excess of the limits in section 12(d)(l)(B) of the Act. Applicants submit that the proposed conditions to the requested relief address the concerns underlying the limits in section 12(d)(1), which include concerns about undue influence, excessive layering of fees and overly complex structures.
11. Applicants submit that their proposed conditions address any concerns regarding the potential for undue influence. To limit the control that an Investing Fund may have over a Fund, applicants propose a condition prohibiting the adviser of an Investing Management Company (“Investing Fund Advisor”), sponsor of an Investing Trust (“Sponsor”), any person controlling, controlled by, or under common control with the Investing Fund Advisor or Sponsor, and any investment company or issuer that would be an investment company but for sections 3(c)(1) or 3(c)(7) of the Act that is advised or sponsored by the Investing Fund Advisor, the Sponsor, or any person controlling, controlled by, or under common control with the Investing Fund Advisor or Sponsor (“Investing Fund's Advisory Group”) from controlling (individually or in the aggregate) a Fund within the meaning of section 2(a)(9) of the Act. The same prohibition would apply to any sub-adviser to an Investing Management Company (“Investing Fund Sub-Advisor”), any person controlling, controlled by or under common control with the Investing Fund Sub-Advisor, and any investment company or issuer that would be an investment company but for sections 3(c)(1) or 3(c)(7) of the Act (or portion of such investment company or issuer) advised or sponsored by the Investing Fund Sub-Advisor or any person controlling, controlled by or under common control with the Investing Fund Sub-Advisor
12. Applicants propose a condition to ensure that no Investing Fund or Investing Fund Affiliate
13. Applicants propose several conditions to address the potential for layering of fees. Applicants note that the board of directors or trustees of any Investing Management Company, including a majority of the directors or trustees who are not “interested persons” within the meaning of section 2(a)(19) of the Act (“disinterested directors or trustees”), will be required to find that the advisory fees charged under the contract are based on services provided that will be in addition to, rather than duplicative of, services provided under the advisory contract of any Fund in which the Investing Management Company may invest. Applicants also state that any sales charges and/or service fees charged with respect to shares of an Investing Fund will not exceed the limits applicable to a fund of funds as set forth in NASD Conduct Rule 2830.
14. Applicants submit that the proposed arrangement will not create an overly complex fund structure. Applicants note that a Fund will be prohibited from acquiring securities of any investment company or company relying on section 3(c)(1) or 3(c)(7) of the Act in excess of the limits contained in section 12(d)(1)(A) of the Act, except to the extent permitted by exemptive relief from the Commission permitting the Fund to purchase shares of other investment companies for short-term cash management purposes.
15. To ensure that an Investing Fund is aware of the terms and conditions of the requested order, the Investing Funds must enter into an agreement with the respective Funds (“FOF Participation Agreement”). The FOF Participation Agreement will include an acknowledgement from the Investing Fund that it may rely on the order only to invest in a Fund and not in any other investment company.
16. Section 17(a) of the Act generally prohibits an affiliated person of a registered investment company, or an affiliated person of such a person (“second tier affiliate”), from selling any security to or purchasing any security from the company. Section 2(a)(3) of the Act defines “affiliated person” to include any person directly or indirectly owning, controlling, or holding with power to vote, 5% or more of the outstanding voting securities of the other person and any person directly or indirectly controlling, controlled by, or under common control with, the other person. Section 2(a)(9) of the Act defines “control” as the power to exercise a controlling influence over the management or policies of a company and provides that a control relationship will be presumed where one person owns more than 25% of another person's voting securities. Each Fund may be deemed to be controlled by an Advisor and hence affiliated persons of each other. In addition, the Funds may be deemed to be under common control with any other registered investment company (or series thereof) advised by an Advisor (an “Affiliated Fund”).
17. Applicants request an exemption under sections 6(c) and 17(b) of the Act from sections 17(a)(1) and 17(a)(2) of the Act to permit in-kind purchases and redemptions of Creation Units by persons that are affiliated persons or second tier affiliates of the Funds solely by virtue of one or more of the following: (a) Holding 5% or more, or in excess of 25% of the outstanding Shares of one or more Funds; (b) having an affiliation with a person with an ownership interest described in (a); or (c) holding 5% or more, or more than 25% of the Shares of one or more Affiliated Funds.
18. Applicants assert that no useful purpose would be served by prohibiting such affiliated persons from making in-kind purchases or in-kind redemptions of Shares of a Fund in Creation Units. Absent the unusual circumstances discussed in the application, the Deposit Instruments and Redemption Instruments available for a Fund will be the same for all purchasers and redeemers, respectively, and will correspond
19. Applicants also submit that the sale of Shares to and redemption of Shares from an Investing Fund meets the standards for relief under sections 17(b) and 6(c) of the Act. Applicants note that any consideration paid for the purchase or redemption of Shares directly from a Fund will be based on the NAV of the Fund in accordance with policies and procedures set forth in the Fund's registration statement.
Applicants agree that any order of the Commission granting the requested relief will be subject to the following conditions:
1. As long as a Fund operates in reliance on the requested order, the Shares of the Fund will be listed on a Stock Exchange.
2. Neither the Trust nor any Fund will be advertised or marketed as an open-end investment company or a mutual fund. Any advertising material that describes the purchase or sale of Creation Units or refers to redeemability will prominently disclose that the Shares are not individually redeemable and that owners of the Shares may acquire those Shares from the Fund and tender those Shares for redemption to the Fund in Creation Units only.
3. The Web site for the Funds, which is and will be publicly accessible at no charge, will contain, on a per Share basis, for each Fund the prior Business Day's NAV and the market closing price or Bid/Ask Price, and a calculation of the premium or discount of the market closing price or Bid/Ask Price against such NAV.
4. On each Business Day, before commencement of trading in Shares on the Stock Exchange, the Fund will disclose on its Web site the identities and quantities of the Portfolio Instruments held by the Fund that will form the basis for the Fund's calculation of NAV at the end of the Business Day.
5. The Advisor or any Sub-Advisor, directly or indirectly, will not cause any Authorized Participant (or any investor on whose behalf an Authorized Participant may transact with the Fund) to acquire any Deposit Instrument for the Fund through a transaction in which the Fund could not engage directly.
6. The requested relief to permit ETF operations will expire on the effective date of any Commission rule under the Act that provides relief permitting the operation of actively-managed exchange-traded funds.
1. The members of the Investing Fund's Advisory Group will not control (individually or in the aggregate) a Fund within the meaning of section 2(a)(9) of the Act. The members of the Investing Fund's Sub-Advisory Group will not control (individually or in the aggregate) a Fund within the meaning of section 2(a)(9) of the Act. If, as a result of a decrease in the outstanding voting securities of a Fund, the Investing Fund's Advisory Group or the Investing Fund's Sub-Advisory Group, each in the aggregate, becomes a holder of more than 25 percent of the outstanding voting securities of a Fund, it will vote its Shares of the Fund in the same proportion as the vote of all other holders of the Fund's Shares. This condition does not apply to the Investing Fund's Sub-Advisory Group with respect to a Fund for which the Investing Fund Sub-Advisor or a person controlling, controlled by or under common control with the Investing Fund Sub-Advisor acts as the investment adviser within the meaning of section 2(a)(20)(A) of the Act.
2. No Investing Fund or Investing Fund Affiliate will cause any existing or potential investment by the Investing Fund in a Fund to influence the terms of any services or transactions between the Investing Fund or an Investing Fund Affiliate and the Fund or a Fund Affiliate.
3. The board of directors or trustees of an Investing Management Company, including a majority of the independent directors or trustees, will adopt procedures reasonably designed to ensure that the Investing Fund Advisor and any Investing Fund Sub-Advisor are conducting the investment program of the Investing Management Company without taking into account any consideration received by the Investing Management Company or an Investing Fund Affiliate from a Fund or a Fund Affiliate in connection with any services or transactions.
4. Once an investment by an Investing Fund in the Shares of a Fund exceeds the limit in section 12(d)(1)(A)(i) of the Act, the Board of a Fund, including a majority of the independent directors or trustees, will determine that any consideration paid by the Fund to the Investing Fund or an Investing Fund Affiliate in connection with any services or transactions: (i) Is fair and reasonable in relation to the nature and quality of the services and benefits received by the Fund; (ii) is within the range of consideration that the Fund would be required to pay to another unaffiliated entity in connection with the same services or transactions; and (iii) does not involve overreaching on the part of any person concerned. This condition does not apply with respect to any services or transactions between a Fund and its investment adviser(s), or any person controlling, controlled by or under common control with such investment adviser(s).
5. The Investing Fund Advisor, or Trustee or Sponsor, as applicable, will waive fees otherwise payable to it by the Investing Fund in an amount at least equal to any compensation (including fees received pursuant to any plan adopted by a Fund under rule 12b-1 under the Act) received from a Fund by the Investing Fund Advisor, or Trustee or Sponsor, or an affiliated person of the Investing Fund Advisor, or Trustee or Sponsor, other than any advisory fees paid to the Investing Fund Advisor, or Trustee, or Sponsor, or its affiliated person by the Fund, in connection with the investment by the Investing Fund in the Fund. Any Investing Fund Sub-Advisor will waive fees otherwise payable to the Investing Fund Sub-Advisor, directly or indirectly, by the Investing Management Company in an amount at least equal to any compensation received from a Fund by the Investing Fund Sub-Advisor, or an affiliated person of the Investing Fund Sub-Advisor, other than any advisory fees paid to the Investing Fund Sub-Advisor or its affiliated person by the Fund, in connection with the investment by the Investing Management Company in the Fund made at the direction of the Investing Fund Sub-Advisor. In the event that the Investing Fund Sub-Advisor waives fees, the benefit of the waiver will be passed through to the Investing Management Company.
6. No Investing Fund or Investing Fund Affiliate (except to the extent it is acting in its capacity as an investment adviser to a Fund) will cause a Fund to purchase a security in an Affiliated Underwriting.
7. The Board of a Fund, including a majority of the independent directors or trustees, will adopt procedures reasonably designed to monitor any purchases of securities by the Fund in an Affiliated Underwriting, once an investment by an Investing Fund in the securities of the Fund exceeds the limit of section 12(d)(1)(A)(i) of the Act, including any purchases made directly from an Underwriting Affiliate. The Board will review these purchases periodically, but no less frequently than
8. Each Fund will maintain and preserve permanently in an easily accessible place a written copy of the procedures described in the preceding condition, and any modifications to such procedures, and will maintain and preserve for a period of not less than six years from the end of the fiscal year in which any purchase in an Affiliated Underwriting occurred, the first two years in an easily accessible place, a written record of each purchase of securities in Affiliated Underwritings once an investment by an Investing Fund in the securities of the Fund exceeds the limit of section 12(d)(1)(A)(i) of the Act, setting forth from whom the securities were acquired, the identity of the underwriting syndicate's members, the terms of the purchase, and the information or materials upon which the Board's determinations were made.
9. Before investing in a Fund in excess of the limits in section 12(d)(1)(A), an Investing Fund will execute a FOF Participation Agreement with the Fund stating that their respective boards of directors or trustees and their investment advisers, or Trustee and Sponsor, as applicable, understand the terms and conditions of the order, and agree to fulfill their responsibilities under the order. At the time of its investment in Shares of a Fund in excess of the limit in section 12(d)(1)(A)(i), an Investing Fund will notify the Fund of the investment. At such time, the Investing Fund will also transmit to the Fund a list of the names of each Investing Fund Affiliate and Underwriting Affiliate. The Investing Fund will notify the Fund of any changes to the list as soon as reasonably practicable after a change occurs. The Fund and the Investing Fund will maintain and preserve a copy of the order, the FOF Participation Agreement, and the list with any updated information for the duration of the investment and for a period of not less than six years thereafter, the first two years in an easily accessible place.
10. Before approving any advisory contract under section 15 of the Act, the board of directors or trustees of each Investing Management Company, including a majority of the independent directors or trustees, will find that the advisory fees charged under such contract are based on services provided that will be in addition to, rather than duplicative of, the services provided under the advisory contract(s) of any Fund in which the Investing Management Company may invest. These findings and their basis will be recorded fully in the minute books of the appropriate Investing Management Company.
11. Any sales charges and/or service fees charged with respect to shares of an Investing Fund will not exceed the limits applicable to a fund of funds as set forth in NASD Conduct Rule 2830.
12. No Fund relying on the section 12(d)(1) relief will acquire securities of any investment company or company relying on section 3(c)(1) or 3(c)(7) of the Act in excess of the limits contained in section 12(d)(1)(A) of the Act, except to the extent permitted by exemptive relief from the Commission permitting the Fund to purchase shares of other investment companies for short-term cash management purposes.
For the Commission, by the Division of Investment Management, under delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes to extend the operation of its Flexible Exchange Options (“FLEX Options”) pilot program regarding permissible exercise settlement values for FLEX Index Options.
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
On January 28, 2010, the Exchange received approval of a rule change that, among other things, established a pilot program regarding permissible exercise settlement values for FLEX Index Options. The pilot program is currently set to expire on the earlier of November 2, 2013 or the date on which the pilot program is approved on a permanent basis.
Under Rules 24A.4,
Under the exercise settlement values pilot, this restriction on p.m. and specified average price settlements in FLEX Index Options was eliminated.
CBOE is proposing to extend the pilot program through the earlier of November 3, 2014 or the date on which the pilot program is approved on a permanent basis. CBOE believes the pilot program has been successful and well received by its membership and the investing public for the period that it has been in operation as a pilot. In support of the proposed extension of the pilot program, and as required by the pilot program's Approval Order, the Exchange has submitted to the Commission pilot program reports regarding the pilot, which detail the Exchange's experience with the program. Specifically, the Exchange provided the Commission an annual report analyzing volume and open interest for each broad-based FLEX Index Options class overlying an Expiration Friday, p.m.-settled FLEX Index Options series.
The Exchange believes there is sufficient investor interest and demand in the pilot program to warrant its extension. The Exchange believes that, for the period that the pilot has been in operation, the program has provided investors with additional means of managing their risk exposures and carrying out their investment objectives. Furthermore, the Exchange believes that it has not experienced any adverse market effects with respect to the pilot program, including any adverse market volatility effects that might occur as a result of large FLEX exercises in FLEX Option series that expire near Non-FLEX expirations and use a p.m. settlement (as discussed below).
In that regard, based on the Exchange's experience in trading FLEX Options to date and over the pilot period, CBOE continues to believe that the restrictions on exercise settlement values are no longer necessary to insulate Non-FLEX expirations from the potential adverse market impacts of FLEX expirations.
The Exchange also notes that certain position limit, aggregation and exercise limit requirements continue to apply to FLEX Index Options in accordance with Rules 24A.7,
CBOE is also cognizant of the OTC market, in which similar restrictions on exercise settlement values do not apply. CBOE continues to believe that the pilot program is appropriate and reasonable and provides market participants with additional flexibility in determining whether to execute their customized options in an exchange environment or in the OTC market. CBOE continues to believe that market participants benefit from being able to trade these customized options in an exchange environment in several ways, including, but not limited to, enhanced efficiency in initiating and closing out positions, increased market transparency, and heightened contra-party creditworthiness due to the role of OCC as issuer and guarantor of FLEX Options.
If, in the future, the Exchange proposes an additional extension of the pilot program, or should the Exchange propose to make the pilot program permanent (which the Exchange currently intends to do), the Exchange will submit, along with any filing proposing such amendments to the pilot program, an additional pilot program report covering the extended period during which the pilot program was in effect and including the details referenced above and consistent with the pilot program's Approval Order. The pilot program report would be submitted to the Commission at least two months prior to the new expiration date of the pilot program. The Exchange will also continue, on a periodic basis, to submit interim reports of volume and open interest consistent with the terms of the exercise settlement values pilot program as described in the pilot program's Approval Order. All such pilot reports would continue to be provided by the Exchange along with a request for confidential treatment under FOIA.
The Exchange believes the proposed rule change is consistent with the Act and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.
In particular, the Exchange believes that the proposed extension of the pilot program, which permits additional exercise settlement values, would provide greater opportunities for investors to manage risk through the use of FLEX Options. Further, the Exchange believes that it has not experienced any adverse effects from the operation of the pilot program, including any adverse market volatility effects that might occur as a result of large FLEX exercises in FLEX Option series that expire near Non-FLEX expirations and use a p.m. settlement. The Exchange also believes that the extension of the exercise settlement values pilot does not raise any unique regulatory concerns. In particular, although p.m. settlements may raise questions with the Commission, the Exchange believes that, based on the Exchange's experience in trading FLEX Options to date and over the pilot period, market
CBOE does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act.
The Exchange believes there is sufficient investor interest and demand in the pilot program to warrant its extension. The Exchange believes that, for the period that the pilot has been in operation, the program has provided investors with additional means of managing their risk exposures and carrying out their investment objectives. Furthermore, the Exchange believes that it has not experienced any adverse market effects with respect to the pilot program, including any adverse market volatility effects that might occur as a result of large FLEX exercises in FLEX Option series that expire near Non-Flex expirations and use a p.m. settlement. CBOE believes that the restriction actually places the Exchange at a competitive disadvantage to its OTC counterparts in the market for customized options, and unnecessarily limits market participants' ability to trade in an exchange environment that offers the added benefits of transparency, price discovery, liquidity, and financial stability. Therefore, the Exchange does not believe that the proposed rule change will impose any burden on competition.
The Exchange neither solicited nor received comments on the proposed rule change.
Because the proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative prior to 30 days from the date on which it was filed, or such shorter time as the Commission may designate, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act
A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the Act
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission will institute proceedings to determine whether the proposed rule change should be approved or disapproved.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
This proposed rule change concerns the charters of OCC's Board of Directors (“Board Charter”) and the Membership/Risk Committee (“MRC Charter”), Audit Committee (“AC Charter”) and Performance Committee (“PC Charter”) of OCC's Board of Directors (collectively, the “Committee Charters”).
In its filing with the Commission, OCC included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. OCC has prepared summaries, set forth in sections (A), (B) and (C) below, of the most significant aspects of these statements.
This proposed rule change concerns the Board, Membership/Risk Committee (“MRC”), Audit Committee (“AC”) and Performance Committee (“PC”) Charters.
The introduction of the Board Charter reconfirms that oversight of the management of the business and affairs of OCC is generally vested in the Board. OCC has not previously adopted a charter for its Board of Directors (“Board”) because OCC's By-Laws and Rules provide the framework within which the respective responsibilities of OCC's Board and management have been defined. The Board Charter does not impose any new responsibilities on the Board, but rather reflects the longstanding powers and duties of the Board, as well as underlying practices that have been developed to aid the Board in meeting its obligations. The Board's adoption of a Charter at this time reflects a desire to increase the transparency of the Board's oversight activities for parties outside of OCC, promote accountability, and to align with corporate governance best practices.
The Board Charter would also acknowledge certain parameters applicable to the membership in and organization of the Board, many of which are separately provided for in OCC's By-Laws.
The Board Charter would address certain aspects of the membership and organization of the Board with respect to meetings. The Board would meet a minimum of five times each year with special meetings called pursuant to the By-Laws.
The Board Charter would provide that the Board is authorized to make inquiries as it deems appropriate in the execution of its duties and may confer with OCC management or employees.
The Board would be permitted to form such committees and subcommittees as it deems appropriate and delegate authority to committee members.
As a more detailed expression of the Board's responsibility to act as a steward of OCC and ensure it has the critical capabilities to achieve its obligations in a safe, sound, efficient and prudential manner, the Board Charter would identify specific
OCC has long maintained Charters for the MRC, AC and PC (each, a “Committee,” and collectively, the “Committees”). Below is a discussion of the provisions common across all the Committee Charters, followed by a discussion of each Committee Charter's unique provisions.
The purpose of the Committee Charters is to describe the role each Committee plays in assisting the Board in fulfilling its responsibilities, as described in OCC's By-Laws and Rules, as well as specify the policies and procedures governing the membership and organization, scope of authority, and specific functions and responsibilities of each Committee. The guidelines for the composition of each Committee, as well as the policies regarding its meeting schedules, quorum rules, minute-keeping and reporting requirements, are set forth in each charter and conform to applicable requirements specified in OCC's By-Laws and Rules. Each Committee, subject to the direction of the Board, is authorized to act on behalf of the Board with respect to any matter necessary or appropriate to accomplish the purpose and responsibilities set forth in its Charter, and is authorized to further delegate this authority to various subcommittees that it may form. Each Committee is authorized to make inquiries into any matter related to its respective purpose and responsibilities
While each Committee Charter sets forth its own Committee composition requirements, each requires the inclusion of at least one Public Director and empowers the Board to remove or replace any Committee member at any time.
Each Committee Charter sets forth its own meeting schedule, though each empowers its respective chairman to call additional meetings as circumstances dictate. Each Committee Charter specifies that the agenda for each Committee's meetings would be established by the chairman of the Committee, or its designee, in consultation with the Secretary and OCC's management. A majority of the members would constitute a quorum, and if the chairman is not present at a meeting the members who are present would designate a member to act as the chairman. All Committees are permitted to call executive sessions from which guests of such Committee may be excluded, and Committee members are permitted to participate in all meetings by conference telephone call or other means of communication that permit all meeting participants to hear each other.
Each Committee Charter requires the relevant Committee to review its respective charter annually, with each charter submitted to OCC's Board for reapproval with any such changes that the relevant Committee deems advisable.
The discussion that follows summarizes the key charter provisions associated with the specific functions of the MRC, AC and PC, respectively.
The MRC Charter sets forth the MRC's purpose as overseeing OCC's policies and processes for identifying, addressing and reporting on strategic, operational and financial risk as well as OCC's enterprise risk management framework, among other duties, as well as performing those functions delegated to it in OCC's By-Laws and Rules.
The MRC Charter requires the MRC to be composed of OCC's Chairman, Member Vice Chairman, and three or more other Member Directors appointed annually by the Board. The MRC is to be chaired by a Public Director. The MRC Charter requires the MRC to meet at least seven times a year.
The MRC Charter sets forth certain responsibilities and functions for the MRC, including but not limited to, the following: reviewing and approving or disapproving certain requests from clearing members, including proposals to become managed clearing members, to expand clearing activities to include additional account types or products, and to participate in stock loan programs; periodically reviewing OCC's initial and ongoing membership requirements and standards; periodically reviewing and recommending modifications to the inputs to OCC's margin formula, the methodologies behind margin and clearing fund requirements, the lists of approved classes of GSE debt securities for margin deposits, and the applicable haircuts for margin; modifying margin requirements; reviewing the adequacy and efficacy of and recommending modifications to OCC's contingency plans for clearing member failures; periodically reviewing clearing member surveillance standards, and reviewing and advising management with respect to such surveillance; periodically reviewing and assessing, and reviewing reports from, OCC's enterprise risk management program; and performing
The AC Charter sets forth the purpose of the AC as assisting the Board in fulfilling its oversight responsibilities, by serving as an independent and objective party to oversee OCC's financial reporting process, system of internal control, and auditing, accounting and compliance environment and processes. The AC's purpose also includes overseeing the audit efforts of OCC's independent accountants and the internal audit department, as well as facilitating open communication among the independent accountants, financial and senior management, internal audit department, compliance department and the Board.
The AC Charter requires that the AC be composed of three or more directors appointed annually by the Board, each of whom must have a working familiarity with basic finance and accounting practices. At least one member, if possible, is required to have accounting or related financial management expertise. The Board is permitted to appoint a Chair of the AC, though in the absence of a Board appointment, the AC should appoint a Chairman by majority vote of the full AC membership. The AC Charter requires the AC to meet at least four times a year.
The AC Charter also assigns specific activities to the AC, including, but not limited to, the following: appointing, overseeing and reviewing OCC's independent accountants, and all fees paid to them; reviewing the annual audit plan, annual internal control attestation engagement, and the annual audited financial statements and related reports; approve any decision of OCC's management to appoint or replace the Chief Compliance Officer; reviewing and approving the Compliance Charter; assessing the performance and effectiveness of the compliance program; reviewing and evaluating any annual compliance report that may as a matter of regulation be certified by the Chief Compliance Officer; reviewing remediation tracking performed by OCC's compliance department in connection with regulatory inspection reports and management's response; reviewing OCC's system to communicate and monitor compliance with and enforcement of OCC's Code of Conduct and the outcome of disciplinary actions taken by OCC; and establishing “whistleblower” procedures for the reporting by personnel of any concerns regarding unethical or illegal conduct.
The PC Charter sets forth the PC's purpose as assisting the Board in oversight of OCC's overall performance in promptly and accurately delivering clearance, settlement and other designated industry services and in the accomplishment of other periodically-established corporate goals and objectives given OCC's systemically important status. The PC is also tasked with recommending compensation for certain OCC officers and reviewing and approving the structure and design of employee compensation, incentive and benefit programs.
The PC Charter requires that the PC be composed of OCC's Chairman, Member Vice Chairman and three or more other directors appointed annually by the Board, and that the PC be chaired by OCC's Member Vice Chairman. The PC Charter states that the PC will generally meet in advance of each regularly scheduled Board meeting.
The PC Charter describes the PC's role as one of oversight, including oversight of management's responsibility to identify, organize, and manage the operational, systems, technology, financial, human, and other resources necessary to support OCC's clearance, settlement and other business activities. The PC Charter sets forth additional functions and responsibilities including, but not limited to, the following: regularly scheduled reviews of OCC's Corporate Plan, Budget, executive performance and compensation, employment contracts, changes in OCC's fee structure, and special financial matters; oversight of the administration of OCC's various incentive, bonus, deferred compensation, retirement and welfare plans; periodic assessment of succession plans for key executives; oversight of the compensation, benefits and perquisites of OCC's executive and management personnel, provided that decisions with respect to the individual compensation of the Chairman, Management Vice Chairman, and President shall be made in the form of recommendations to the Board; and any other activities that are consistent with the PC Charter, as the PC or the Board may deem necessary or appropriate.
OCC believes that the proposed rule change is consistent with Section 17A(b)(3)(F) of the Act
OCC does not believe that the proposed rule change would impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act.
Written comments on the proposed rule change were not and are not intended to be solicited with respect to the proposed rule change and none have been received.
Within 45 days of the date of publication of this notice in the
(A) by order approve or disapprove the proposed rule change, or
(B) institute proceedings to determine whether the proposed rule change should be disapproved.
Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington DC 20549-1090.
For the Commission by the Division of Trading and Markets, pursuant to delegated authority.
In accordance with section 4314(c)(4) of 5 United States Code, the Department of State has appointed the following individuals to the Department of State Performance Review Board for Senior Executive Service members:
Maritime Administration.
Notice and request for comments.
The Department of Transportation (DOT) invites public comments about our intention to request the Office of Management and Budget (OMB) approval to renew an information collection. We are required to publish this notice in the
Written comments should be submitted by December 30, 2013.
You may submit comments identified by Docket No. MARAD-2013-0112 through one of the following methods:
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All comments received will be posted without change to
Michael Yarrington, Chief, Office of Marine Insurance, Maritime Administration, U.S. Department of Transportation, 1200 New Jersey Avenue SE., Washington, DC 20590. Copies of this collection can also be obtained from that office.
The Paperwork Reduction Act of 1995; 44 U.S.C. Chapter 35, as amended; and 49 CFR 1.93.
Federal Motor Carrier Safety Administration (FMCSA), DOT.
Notice of final disposition.
FMCSA announces its decision to exempt 19 individuals from its rule prohibiting persons with insulin-treated diabetes mellitus (ITDM) from operating commercial motor vehicles (CMVs) in interstate commerce. The exemptions will enable these individuals to operate CMVs in interstate commerce.
The exemptions are effective October 30, 2013. The exemptions expire on October 30, 2015.
Elaine M. Papp, Chief, Medical Programs Division, (202) 366-4001,
You may see all the comments online through the Federal Document Management System (FDMS) at:
On August 19, 2013, FMCSA published a notice of receipt of Federal diabetes exemption applications from 19 individuals and requested comments from the public (78 FR 50486). The public comment period closed on September 18, 2013, and one comment was received.
FMCSA has evaluated the eligibility of the 19 applicants and determined that granting the exemptions to these individuals would achieve a level of safety equivalent to or greater than the level that would be achieved by complying with the current regulation 49 CFR 391.41(b)(3).
The Agency established the current requirement for diabetes in 1970 because several risk studies indicated that drivers with diabetes had a higher rate of crash involvement than the general population. The diabetes rule provides that “A person is physically qualified to drive a commercial motor vehicle if that person has no established medical history or clinical diagnosis of diabetes mellitus currently requiring insulin for control” (49 CFR 391.41(b)(3)).
FMCSA established its diabetes exemption program, based on the Agency's July 2000 study entitled “A Report to Congress on the Feasibility of a Program to Qualify Individuals with Insulin-Treated Diabetes Mellitus to Operate in Interstate Commerce as Directed by the Transportation Act for the 21st Century.” The report concluded that a safe and practicable protocol to allow some drivers with ITDM to operate CMVs is feasible. The September 3, 2003 (68 FR 52441),
These 19 applicants have had ITDM over a range of 1 to 28 years. These applicants report no severe hypoglycemic reactions resulting in loss of consciousness or seizure, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning symptoms, in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the past 5 years. In each case, an endocrinologist verified that the driver has demonstrated a willingness to properly monitor and manage his/her diabetes mellitus, received education related to diabetes management, and is on a stable insulin regimen. These drivers report no other disqualifying conditions, including diabetes-related complications. Each meets the vision requirement at 49 CFR 391.41(b)(10).
The qualifications and medical condition of each applicant were stated and discussed in detail in the August 19, 2013,
FMCSA received one comment in this proceeding. The comment is considered and discussed below.
The Pennsylvania Department of Transportation is in favor of granting exemptions to Peter Engel, Lewis Forrester, Charles LaBruno, and Shawn E. Marks after reviewing their driving histories.
Under 49 U.S.C. 31136(e) and 31315, FMCSA may grant an exemption from the diabetes requirement in 49 CFR 391.41(b)(3) if the exemption is likely to achieve an equivalent or greater level of safety than would be achieved without the exemption. The exemption allows the applicants to operate CMVs in interstate commerce.
To evaluate the effect of these exemptions on safety, FMCSA considered medical reports about the applicants' ITDM and vision, and reviewed the treating endocrinologists' medical opinion related to the ability of the driver to safely operate a CMV while using insulin.
Consequently, FMCSA finds that in each case exempting these applicants from the diabetes requirement in 49 CFR 391.41(b)(3) is likely to achieve a level of safety equal to that existing without the exemption.
The terms and conditions of the exemption will be provided to the applicants in the exemption document and they include the following: (1) That each individual submit a quarterly monitoring checklist completed by the treating endocrinologist as well as an annual checklist with a comprehensive medical evaluation; (2) that each individual reports within 2 business days of occurrence, all episodes of severe hypoglycemia, significant complications, or inability to manage diabetes; also, any involvement in an accident or any other adverse event in a CMV or personal vehicle, whether or not it is related to an episode of hypoglycemia; (3) that each individual provide a copy of the ophthalmologist's or optometrist's report to the medical examiner at the time of the annual medical examination; and (4) that each individual provide a copy of the annual medical certification to the employer for retention in the driver's qualification file, or keep a copy in his/her driver's qualification file if he/she is self-employed. The driver must also have a copy of the certification when driving, for presentation to a duly authorized Federal, State, or local enforcement official.
Based upon its evaluation of the 19 exemption applications, FMCSA exempts Francisco Barron (TX), Jase V. Burkhart (SD), Peter Engel (PA), Jhon A. Fitzgerald (ME), Lewis E. Forrester (PA), Randall G. Freed (IL), Jesus A. Gonzales (NY), Robert D. Graves (IA), Michael G. Harp (OK), Ray Harrison (MD), Edward E. Hartford (NY), Michael Hatfield (KY), Charles LaBruno (PA), Clinton D. Lewis (IA), Shawn E. Marks (PA), John D. Patterson (OH), Ricky A. Root (IL), Tina M. Schreiber (MN), and Donald G. Staggs (CA) from the ITDM requirement in 49 CFR 391.41(b)(3), subject to the conditions listed under “Conditions and Requirements” above.
In accordance with 49 U.S.C. 31136(e) and 31315 each exemption will be valid for two years unless revoked earlier by FMCSA. The exemption will be revoked if the following occurs: (1) The person fails to comply with the terms and conditions of the 1/exemption; (2) the exemption has resulted in a lower level of safety than was maintained before it was granted; or (3) continuation of the exemption would not be consistent with the goals and objectives of 49 U.S.C. 31136(e) and 31315. If the exemption is still effective at the end of the 2-year period, the person may apply to FMCSA for a renewal under procedures in effect at that time.
Federal Motor Carrier Safety Administration (FMCSA), DOT.
Notice of renewal of exemptions; request for comments.
FMCSA announces its decision to renew the exemptions from the vision requirement in the Federal Motor Carrier Safety Regulations for 13 individuals. FMCSA has statutory authority to exempt individuals from the vision requirement if the exemptions granted will not compromise safety. The Agency has concluded that granting these exemption renewals will provide a level of safety that is equivalent to or greater than the level of safety maintained without the exemptions for these commercial motor vehicle (CMV) drivers.
This decision is effective December 5, 2013. Comments must be received on or before November 29, 2013.
You may submit comments bearing the Federal Docket Management System (FDMS) numbers: Docket No. [Docket No. FMCSA-2001-9258; FMCSA-2011-26690], using any of the following methods:
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Elaine M. Papp, Chief, Medical Programs Division, 202-366-4001,
Under 49 U.S.C. 31136(e) and 31315, FMCSA may renew an exemption from the vision requirements in 49 CFR 391.41(b)(10), which applies to drivers
This notice addresses 13 individuals who have requested renewal of their exemptions in accordance with FMCSA procedures. FMCSA has evaluated these 13 applications for renewal on their merits and decided to extend each exemption for a renewable two-year period. They are:
The exemptions are extended subject to the following conditions: (1) That each individual has a physical examination every year (a) by an ophthalmologist or optometrist who attests that the vision in the better eye continues to meet the requirements in 49 CFR 391.41(b)(10), and (b) by a medical examiner who attests that the individual is otherwise physically qualified under 49 CFR 391.41; (2) that each individual provides a copy of the ophthalmologist's or optometrist's report to the medical examiner at the time of the annual medical examination; and (3) that each individual provide a copy of the annual medical certification to the employer for retention in the driver's qualification file and retains a copy of the certification on his/her person while driving for presentation to a duly authorized Federal, State, or local enforcement official. Each exemption will be valid for two years unless rescinded earlier by FMCSA. The exemption will be rescinded if: (1) The person fails to comply with the terms and conditions of the exemption; (2) the exemption has resulted in a lower level of safety than was maintained before it was granted; or (3) continuation of the exemption would not be consistent with the goals and objectives of 49 U.S.C. 31136(e) and 31315.
Under 49 U.S.C. 31315(b)(1), an exemption may be granted for no longer than two years from its approval date and may be renewed upon application for additional two year periods. In accordance with 49 U.S.C. 31136(e) and 31315, each of the 13 applicants has satisfied the entry conditions for obtaining an exemption from the vision requirements (66 FR 17743; 66 FR 33990; 68 FR 35772; 70 FR 33937; 72 FR 32705; 74 FR 26464; 76 FR 34135; 76 FR 64169; 76 FR 75943). Each of these 13 applicants has requested renewal of the exemption and has submitted evidence showing that the vision in the better eye continues to meet the requirement specified at 49 CFR 391.41(b)(10) and that the vision impairment is stable. In addition, a review of each record of safety while driving with the respective vision deficiencies over the past two years indicates each applicant continues to meet the vision exemption requirements.
These factors provide an adequate basis for predicting each driver's ability to continue to drive safely in interstate commerce. Therefore, FMCSA concludes that extending the exemption for each renewal applicant for a period of two years is likely to achieve a level of safety equal to that existing without the exemption.
FMCSA will review comments received at any time concerning a particular driver's safety record and determine if the continuation of the exemption is consistent with the requirements at 49 U.S.C. 31136(e) and 31315. However, FMCSA requests that interested parties with specific data concerning the safety records of these drivers submit comments by November 29, 2013.
FMCSA believes that the requirements for a renewal of an exemption under 49 U.S.C. 31136(e) and 31315 can be satisfied by initially granting the renewal and then requesting and evaluating, if needed, subsequent comments submitted by interested parties. As indicated above, the Agency previously published notices of final disposition announcing its decision to exempt these 13 individuals from the vision requirement in 49 CFR 391.41(b)(10). The final decision to grant an exemption to each of these individuals was made on the merits of each case and made only after careful consideration of the comments received to its notices of applications. The notices of applications stated in detail the qualifications, experience, and medical condition of each applicant for an exemption from the vision requirements. That information is available by consulting the above cited
Interested parties or organizations possessing information that would otherwise show that any, or all, of these drivers are not currently achieving the statutory level of safety should immediately notify FMCSA. The Agency will evaluate any adverse evidence submitted and, if safety is being compromised or if continuation of the exemption would not be consistent with the goals and objectives of 49 U.S.C. 31136(e) and 31315, FMCSA will take immediate steps to revoke the exemption of a driver.
You may submit your comments and material online or by fax, mail, or hand delivery, but please use only one of these means. FMCSA recommends that you include your name and a mailing address, an email address, or a phone number in the body of your document so that FMCSA can contact you if there are questions regarding your submission.
To submit your comment online, go to
We will consider all comments and material received during the comment period and may change this proposed rule based on your comments. FMCSA may issue a final rule at any time after the close of the comment period.
To view comments, as well as any documents mentioned in this preamble, To submit your comment online, go to
Federal Motor Carrier Safety Administration (FMCSA).
Notice of applications for exemption; request for comments.
FMCSA announces receipt of applications from 25 individuals for exemptions from the prohibition against persons with insulin-treated diabetes mellitus (ITDM) operating commercial motor vehicles (CMVs) in interstate commerce. If granted, the exemptions would enable these individuals with ITDM to operate CMVs in interstate commerce.
Comments must be received on or before November 29, 2013.
You may submit comments bearing the Federal Docket Management System (FDMS) Docket No. FMCSA-2013-0190 using any of the following methods:
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Elaine M. Papp, Chief, Medical Programs Division, (202) 366-4001,
Under 49 U.S.C. 31136(e) and 31315, FMCSA may grant an exemption from the Federal Motor Carrier Safety Regulations for a 2-year period if it finds “such exemption would likely achieve a level of safety that is equivalent to or greater than the level that would be achieved absent such exemption.” The statute also allows the Agency to renew exemptions at the end of the 2-year period. The 25 individuals listed in this notice have recently requested such an exemption from the diabetes prohibition in 49 CFR 391.41(b)(3), which applies to drivers of CMVs in interstate commerce. Accordingly, the Agency will evaluate the qualifications of each applicant to determine whether granting the exemption will achieve the required level of safety mandated by statute.
Ms. Cameron, 67, has had ITDM since 2008. Her endocrinologist examined her in 2013 and certified that she has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. Her endocrinologist certifies that Ms. Cameron understands diabetes management and monitoring, has stable control of her diabetes using insulin, and is able to drive a CMV safely. Ms. Cameron meets the vision requirements of 49 CFR 391.41(b)(10). Her optometrist examined her in 2013 and certified that she does not have diabetic retinopathy. She holds a Class B CDL from Indiana.
Mr. Childress, 32, has had ITDM since 1995. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Childress understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Childress meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class D operator's license from Kentucky.
Mr. Costello, 35, has had ITDM since 2013. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Costello understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Costello meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds an operator's license from Indiana.
Mr. Crawford, 54, has had ITDM since 2013. His endocrinologist examined him in 2013 and certified that he has had no
Mr. Droog, 67, has had ITDM since 2009. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Droog understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Droog meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Iowa.
Mr. Gilmore, 67, has had ITDM since 2004. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Gilmore understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Gilmore meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2013 and certified that he has stable non-proliferative diabetic retinopathy. He holds a Class A CDL from Washington.
Mr. Hunter, 70, has had ITDM since 2010. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Hunter understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Hunter meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds an operator's license from Virginia.
Mr. Kollos, 38, has had ITDM since 1987. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Kollos understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Kollos meets the vision requirements of 49 CFR 391.41(b)(10). His optometrist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class B CDL from Minnesota.
Mr. Lindahl, 28, has had ITDM since 1992. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Lindahl understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Lindahl meets the vision requirements of 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2013 and certified that he has stable nonproliferative diabetic retinopathy. He holds a Class D operator's license from Wisconsin.
Mr. Mahan, 69, has had ITDM since 2002. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Mahan understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Mahan meets the vision requirements of 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class D Operator's license from Alabama.
Mr. Martin, 31, has had ITDM since 2008. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Martin understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Martin meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Pennsylvania.
Mr. McSweeney, 65, has had ITDM since 2009. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. McSweeney understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. McSweeney meets the vision requirements of 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2013 and certified that he has stable,
Mr. Miller, 51 has had ITDM since 2013. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Miller understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Miller meets the vision requirements of 49 CFR 391.41(b)(10). His optometrist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Indiana.
Mr. Orms, 56, has had ITDM since 2000. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Orms understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Orms meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class B CDL from Alabama.
Mr. Pederson, 38, has had ITDM since 1991. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Pederson understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Pederson meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class B CDL from Minnesota.
Mr. Rodgers, 51, has had ITDM since 2013. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Rodgers understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Rodgers meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Pennsylvania.
Mr. Rosenau, 46 has had ITDM since 2013. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Rosenau understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Rosenau meets the vision requirements of 49 CFR 391.41(b)(10). His optometrist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Minnesota.
Mr. Sapirstein, 59, has had ITDM since 2000. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Sapirstein understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Sapirstein meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class D operator's license from New Jersey.
Mr. Sosa, 43, has had ITDM since 2012. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Sosa understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Sosa meets the vision requirements of 49 CFR 391.41(b)(10). His optometrist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Maryland.
Mr. Thomas, 63, has had ITDM since 2012. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Thomas understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Thomas meets the vision
Mr. Wasko, 55, has had ITDM since 1993. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Wasko understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Wasko meets the vision requirements of 49 CFR 391.41(b)(10). His optometrist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class E operator's license from Florida.
Mr. Wilhoit, 49, has had ITDM since 2012. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Wilhoit understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Wilhoit meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Pennsylvania.
Mr. Wilk, 54, has had ITDM since 2011. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Wilk understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Wilk meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class C CDL from Ohio.
Mr. Young, 58, has had ITDM since 2005. His endocrinologist examined him in 2013 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Young understands diabetes management and monitoring, as stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Young meets the vision requirements of 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2013 and certified that he does not have diabetic retinopathy. He holds a Class B CDL from Texas.
In accordance with 49 U.S.C. 31136(e) and 31315, FMCSA requests public comment from all interested persons on the exemption petitions described in this notice. We will consider all comments received before the close of business on the closing date indicated in the date section of the notice.
FMCSA notes that section 4129 of the Safe, Accountable, Flexible and Efficient Transportation Equity Act: A Legacy for Users requires the Secretary to revise its diabetes exemption program established on September 3, 2003 (68 FR 52441)
Section 4129 requires: (1) Elimination of the requirement for 3 years of experience operating CMVs while being treated with insulin; and (2) establishment of a specified minimum period of insulin use to demonstrate stable control of diabetes before being allowed to operate a CMV.
In response to section 4129, FMCSA made immediate revisions to the diabetes exemption program established by the September 3, 2003 notice. FMCSA discontinued use of the 3-year driving experience and fulfilled the requirements of section 4129 while continuing to ensure that operation of CMVs by drivers with ITDM will achieve the requisite level of safety required of all exemptions granted under 49 U.S.C. 31136 (e).
Section 4129(d) also directed FMCSA to ensure that drivers of CMVs with ITDM are not held to a higher standard than other drivers, with the exception of limited operating, monitoring and medical requirements that are deemed medically necessary.
The FMCSA concluded that all of the operating, monitoring and medical requirements set out in the September 3, 2003 notice, except as modified, were in compliance with section 4129(d). Therefore, all of the requirements set out in the September 3, 2003 notice, except as modified by the notice in the
You may submit your comments and material online or by fax, mail, or hand delivery, but please use only one of these means. FMCSA recommends that you include your name and a mailing address, an email address, or a phone number in the body of your document so that FMCSA can contact you if there are questions regarding your submission.
To submit your comment online, go to
We will consider all comments and material received during the comment period and may change this proposed rule based on your comments. FMCSA may issue a final rule at any time after the close of the comment period.
To view comments, as well as any documents mentioned in this preamble, To submit your comment online, go to
National Highway Traffic Safety Administration (NHTSA), DOT.
Notice of the OMB review of information collection and solicitation of public comment.
In compliance with the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 35), this notice announces that the Information Collection Request (ICR) abstracted below will be submitted to the Office of Management and Budget (OMB) for review. The ICR describes the nature of the information collection and its expected burden. A
Submit comments to the Office of Management and Budget (OMB) on or before November 29, 2013.
Alan Block at the National Highway Traffic Safety Administration, Office of Behavioral Safety Research (NTI-131), W46-499, Department of Transportation, 1200 New Jersey Avenue SE., Washington, DC 20590. Mr. Block's phone number is 202-366-6401 and his email address is
Send comments regarding the burden estimate, including suggestions for reducing the burden, to the Office of Information and Regulatory Affairs, Office of Management and Budget, 725 17th Street NW., Washington, DC 20503, Attention: Desk Officer for Department of Transportation, National Highway Traffic Safety Administration, or by email at
44 U.S.C. 3506(c)(2)(A).
National Highway Traffic Safety Administration (NHTSA), DOT.
Request for public comment on proposed collection of information.
Before a Federal agency can collect certain information from the public, it must receive approval from the Office of Management and Budget (OMB). Under procedures established by the Paperwork Reduction Act of 1995, before seeking OMB approval, Federal agencies must solicit public comment on proposed collections of information, including extensions and
This document describes the collection of information for which NHTSA intends to seek OMB approval.
Comments must be received on or before December 30, 2013.
You may submit comments identified by DOT Docket ID Number NHTSA-2013-0113 using any of the following methods:
Dr. Russell Pierce, Contracting Officer's Technical Representative, Office of Behavioral Safety Research (NTI-132), National Highway Traffic Safety Administration, 1200 New Jersey Avenue SE., W46-472, Washington, DC 20590. Dr. Pierce's phone number is (202) 366-5599 and his email address is
Under the Paperwork Reduction Act of 1995, before an agency submits a proposed collection of information to OMB for approval, it must publish a document in the
(i) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
(ii) the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
(iii) how to enhance the quality, utility, and clarity of the information to be collected; and
(iv) how to minimize the burden of the collection of information on those who are to respond, including the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.
In compliance with these requirements, NHTSA asks public comment on the following proposed collection of information:
As our population ages, age-related impairments in safe driving abilities will become more prevalent. The private automobile remains by far the most often used and most preferred means of meeting community mobility needs among older adults. Along with the increase in the number of older drivers, an increase in the driving exposure of older adults is likely, both in terms of the frequency of their trips and the distances they drive. In addition, due to increased physical frailty, older individuals are also most likely to be seriously injured or killed in an automotive crash. Therefore, driver medical review practices are likely to assume a more prominent role in the years ahead.
Medical review guidelines and practices can help evaluate drivers referred to a State motor vehicle licensing agency for reexamination due to concerns about unsafe driving performance possibly resulting from suspected age or medical condition related impairments in visual, physical, or mental abilities. Society has an interest in ensuring that these medical review guidelines and practices are in place and are effective in reducing motor vehicle crashes, injury, and death. This data collection will provide NHTSA with an accurate description of current medical review practices across the country. This is a necessary first step in identifying which structures and processes work best.
44 U.S.C. 3506(c)(2)(A).
Chicago Central & Pacific Railroad Company (CCP)
CCP has certified that: (1) No local traffic has moved over the Line for at least two years; (2) there is no overhead traffic on the Line to be rerouted over other lines; (3) no formal complaint filed by a user of rail service on the Line (or by a state or local government entity acting on behalf of such user) regarding cessation of service over the Line either is pending with the Surface Transportation Board (Board) or with any U.S. District Court or has been decided in favor of complainant within the two-year period; and (4) the requirements at 49 CFR 1105.7(c) (environmental report), 49 CFR 1105.11 (transmittal letter), 49 CFR 1105.12 (newspaper publication), and 49 CFR 1152.50(d)(1) (notice to governmental agencies) have been met.
As a condition to this exemption, any employee adversely affected by the abandonment shall be protected under
Provided no formal expression of intent to file an offer of financial assistance (OFA) has been received, this exemption will be effective on November 29, 2013, unless stayed pending reconsideration.
A copy of any petition filed with the Board should be sent to CCP's representative: Audrey L. Brodrick, Fletcher & Sippel LLC, 29 N. Wacker Dr., Suite 920, Chicago, IL 60606.
If the verified notice contains false or misleading information, the exemption is void
CCP has filed a combined environmental and historic report that addresses the effects, if any, of the abandonment on the environment and historic resources. OEA issued an environmental assessment (EA) on October 23, 2013. Interested persons may obtain a copy of the EA by writing to OEA (Room 1100, Surface Transportation Board, Washington, DC 20423-0001) or by calling OEA at (202) 245-0305. Assistance for the hearing impaired is available through the Federal Information Relay Service at (800) 877-8339. Comments on environmental and historic preservation matters must be filed by November 7, 2013.
Environmental, historic preservation, public use, or trail use/rail banking conditions will be imposed, where appropriate, in a subsequent decision.
Pursuant to the provisions of 49 CFR 1152.29(e)(2), CCP shall file a notice of consummation with the Board to signify that it has exercised the authority granted and fully abandoned the Line. If consummation has not been effected by CCP's filing of a notice of consummation by October 30, 2014, and there are no legal or regulatory barriers to consummation, the authority to abandon will automatically expire.
Board decisions and notices are available on our Web site at “
By the Board, Rachel D. Campbell, Director, Office of Proceedings.
On September 30, 2013, BNSF Railway Company (BNSF), CBEC Railway Inc. (CBEC), Iowa Interstate Railroad, Ltd. (IAIS), and Union Pacific Railroad Company (UP) (collectively, applicants) jointly filed a verified notice of exemption under 49 CFR 1180.2(d)(5) to participate in a joint relocation project in Council Bluffs, Iowa (the City).
The purpose of the joint relocation project is to facilitate the reconstruction of Interstates 80 and 29 in Council Bluffs. The Council Bluffs Interstate System (CBIS) Improvements Project is a public works project initiated by the Iowa Department of Transportation (IDOT) that involves the joint relocation project and an acquisition by IAIS of a line of railroad owned by BNSF.
According to applicants, the following steps will be taken to allow for the CBIS Improvements Project to proceed. First, BNSF will close its Council Bluffs yard and convey the underlying land to the State of Iowa. Second, BNSF will abandon the following two segments of its Council Bluffs Subdivision: (1) The segment located between milepost 490.62 and milepost 491.00, a distance of approximately 0.38 miles; and (2) the segment located between milepost 491.75 and 492.65, a distance of approximately 0.90 miles. The first segment will be relocated to the west of Mosquito Creek. This segment is located between BNSF Bayard Subdivision milepost 482.08 and a point near BNSF Council Bluffs Subdivision milepost 488.85, a distance of approximately 1.6 miles. The second segment will be relocated to the west of Highway 192 in downtown Council Bluffs. This segment is located between BNSF milepost 492.65 and the connection to the IAIS main line at IAIS milepost 489.3, a distance of approximately 0.3 miles. Third, CBEC will abandon its main line between milepost 3.90 and milepost 6.47, a distance of approximately 2.8 miles. That portion of CBEC's main line will be relocated to the west bank of Mosquito Creek between milepost 3.90, approximately 1,500 feet to the northwest of IA-92/US-275 and the connection with the lead track to MidAmerican Energy Company's Walter Scott, Jr. Energy Center (MidAmerican), a distance of approximately 1.5 miles. Fourth, UP's trackage rights on CBEC's line to be abandoned will be discontinued and relocated to CBEC's newly constructed main line. Fifth, BNSF and CBEC will establish a crossover connection between their newly constructed and parallel main lines on the west side of Mosquito Creek at a point approximately 900 feet south of I-29. CBEC will grant overhead trackage rights to BNSF from that connection and from BNSF Council Bluffs Subdivision milepost 488.6 to the connection with the lead track to MidAmerican, a distance of approximately 0.6 miles and 0.5 miles, respectively. Sixth, BNSF and CBEC also will establish an opposite-direction crossover connection between their newly constructed and parallel main lines on the west side of Mosquito Creek at a point approximately 1,400 feet south of I-29. BNSF will grant overhead trackage rights to CBEC from that connection to a new connection with CBEC's relocated SIRE industrial lead track at BNSF Council Bluffs Subdivision milepost 488.85, a distance of approximately 1,500 feet. Seventh, BNSF will grant overhead trackage rights to IAIS between BNSF Bayard Subdivision milepost 482.08 and BNSF Council Bluffs Subdivision milepost 488.6. Lastly, BNSF and IAIS will establish new connections between the two carriers at BNSF Bayard Subdivision milepost 482.08 and IAIS milepost 489.30, which will enable BNSF to crossover IAIS from its Council Bluffs Subdivision to reach its Bayard Subdivision through a dual switch arrangement.
Applicants state that the proposed joint relocation project will not disrupt service to shippers, nor will it expand service by BNSF, CBEC, or IAIS into a new territory. According to applicants, there are no shippers located on the rail segments BNSF and CBEC are abandoning.
The Board will exercise jurisdiction over the abandonment, construction, or sale components of a relocation project, and require separate approval or exemption, only where the removal of track affects service to shippers or the construction of new track or transfer of existing track involves expansion into new territory.
As a condition to this exemption, any employees affected by the trackage rights will be protected by the conditions imposed in
The transaction may be consummated on or after November 13, 2013, the effective date of the exemption.
If the verified notice contains false or misleading information, the exemption is void
An original and 10 copies of all pleadings, referring to Docket No. FD 35755, must be filed with the Surface Transportation Board, 395 E Street SW., Washington, DC 20423-0001. In addition, a copy of each pleading must be served on applicants' representatives: Karl Morell, Ball Janik LLP, 655 Fifteenth Street NW., Suite 225, Washington, DC 20005 (BNSF's representative); Benjamin M. Clark, Sullivan & Ward, P.C., 6601 Westown Parkway, Suite 200, West Des Moines, Iowa 50266 (CBEC's representative); Thomas J. Litwiler, Fletcher & Sippel LLC, 29 North Wacker Drive, Suite 920, Chicago, IL 60606 (IAIS's representative); and Jeremy M. Berman, Union Pacific Railroad Company, 1400 Douglas Street STOP 1580, Omaha, NE., 68179 (UP's representative).
Board decisions and notices are available on our Web site at “
By the Board, Rachel D. Campbell, Director, Office of Proceedings.
The Department of the Treasury will submit the following information collection request to the Office of Management and Budget (OMB) for review and clearance in accordance with the Paperwork Reduction Act of 1995, Public Law 104-13, on or after the date of publication of this notice.
Comments should be received on or before November 29, 2013 to be assured of consideration.
Send comments regarding the burden estimate, or any other aspect of the information collection, including suggestion for reducing the burden, to (1) Office of Information and Regulatory Affairs, Office of Management and Budget, Attention: Desk Officer for Treasury, New Executive Office Building, Room 10235, Washington, DC 20503, or email at
Copies of the submission(s) may be obtained by calling (202) 927-5331, email at
The Department of the Treasury will submit the following information collection requests to the Office of Management and Budget (OMB) for review and clearance in accordance with the Paperwork Reduction Act of 1995, Public Law 104-13, on or after the date of publication of this notice.
Comments should be received on or before November 29, 2013 to be assured of consideration.
Send comments regarding the burden estimate, or any other aspect of the information collection, including suggestions for reducing the burden, to (1) Office of Information and Regulatory Affairs, Office of Management and Budget, Attention: Desk Officer for Treasury, New Executive Office Building, Room 10235, Washington, DC 20503, or email at
Copies of the submission(s) may be obtained by calling (202) 622-1295, email at
Centers for Medicare & Medicaid Services (CMS), HHS.
Final rule.
This final rule implements provisions of the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010 (collectively referred to as the Affordable Care Act). Specifically, this final rule outlines financial integrity and oversight standards with respect to Affordable Insurance Exchanges, qualified health plan (QHP) issuers in Federally-facilitated Exchanges (FFEs), and States with regard to the operation of risk adjustment and reinsurance programs. It also establishes additional standards for special enrollment periods, survey vendors that may conduct enrollee satisfaction surveys on behalf of QHP issuers, and issuer participation in an FFE, and makes certain amendments to definitions and standards related to the market reform rules. These standards, which include financial integrity provisions and protections against fraud and abuse, are consistent with Title I of the Affordable Care Act. This final rule also amends and adopts as final interim provisions set forth in the Amendments to the HHS Notice of Benefit and Payment Parameters for 2014 interim final rule, published in the
These regulations are effective on December 30, 2013.
Leigha Basini at (301) 492-4380 for general information.
Jacob Ackerman at (301) 492-4179 for matters relating to Parts 144 and 147, single risk pool and catastrophic plans.
Adam Shaw at (410) 786-1091 for matters relating to the oversight of risk adjustment and reinsurance.
Jaya Ghildiyal at (301) 492-5149 for matters relating to risk corridors.
Shelley Bain at (301) 492-4453 or Anne Pesto at (410) 786-3492 for matters relating to Part 155, Subpart M.
Ariel Novick at (301) 492-4309 for matters relating to the oversight of cost-sharing reductions and advance payments of the premium tax credit.
Johanna Lauer at (301) 492-4397 for matters relating to cost-sharing reduction reconciliation.
Rebecca Zimmermann at (301) 492-4396 for matters relating to quality standards, Part 156, Subpart L.
Cindy Yen at (301) 492-5142 for matters relating to Part 156 other than cost-sharing reductions, advance payments of the premium tax credit, and quality standards.
Pat Meisol at (410) 786-1917 for matters relating to confirmation of HHS payment and collections reports.
This
Starting October 1, 2013, qualified individuals and qualified employees may purchase private health insurance coverage through competitive marketplaces called Affordable Insurance Exchanges, or “Exchanges” (also called Health Insurance Marketplaces). This final rule sets forth oversight and financial integrity standards with respect to Exchanges, Qualified Health Plan (QHP) issuers in Federally-facilitated Exchanges (FFEs), and States with regard to the operation of risk adjustment and reinsurance programs. It establishes additional standards for special enrollment periods, survey vendors that may conduct enrollee satisfaction surveys on behalf of QHP issuers in Exchanges, and issuer participation in an FFE, and makes certain amendments to definitions and standards related to the market reform rules. These standards were proposed in a proposed rule, titled “Patient Protection and Affordable Care Act; Program Integrity: Exchange, SHOP, Premium Stabilization Programs, and Market Standards” (78 FR 37032), which was published in the
Although many of the provisions in this rule become effective by January 1, 2014, we believe that affected parties will not have difficulty complying with the provisions by their effective dates, because most of the standards are based on existing standards currently in effect in the private market, were previously proposed through the Blueprint process, were discussed in agency-issued sub-regulatory guidance, or were discussed in the preambles to the Exchange Establishment Rule,
Because of the many organizations and terms to which we refer by acronym in this final rule, we are listing these acronyms and their corresponding terms in alphabetical order below:
The Patient Protection and Affordable Care Act (Pub. L. 111-148) was enacted on March 23, 2010. The Health Care and Education Reconciliation Act of 2010 (Pub. L. 111-152), which amended and revised several provisions of the Patient Protection and Affordable Care Act, was enacted on March 30, 2010. In this final rule, we refer to the two statutes collectively as the “Affordable Care Act.”
Subtitles A and C of Title I of the Affordable Care Act reorganized, amended, and added to the provisions of Title XXVII of the Public Health Service Act (PHS Act) relating to health insurance issuers in the group and individual markets and to group health plans that are non-Federal governmental plans. As relevant here, section 2702 of the PHS Act (guaranteed availability of coverage) directs a health insurance issuer offering non-grandfathered health insurance coverage in the group or individual market in a State to accept every employer and individual in the State who applies for coverage, subject to certain exceptions. Section 2703 of the PHS Act (guaranteed renewability of coverage) requires a health insurance issuer offering non-grandfathered health insurance coverage in the group or individual market to renew or continue in force such coverage at the option of the plan sponsor or individual, subject to certain exceptions.
As of October 2013 for coverage starting as soon as January 1, 2014, qualified individuals and qualified employers will be able to enroll in QHPs—private health insurance that has
In this final rule, we encourage State flexibility within the boundaries of the law. Sections 1311(b) and 1321(b) of the Affordable Care Act provide that each State has the opportunity to establish an Exchange. Section 1311(b)(1) gives each State the opportunity to establish an Exchange that both facilitates the purchase of QHPs and provides for the establishment of a Small Business Health Options Program (SHOP) that will help qualified employers enroll their employees in QHPs.
Section 1302(e) of the Affordable Care Act outlines standards for offering catastrophic plans in the individual market for certain young adults and people who obtain certification of exemption from the requirement to maintain minimum essential coverage because they cannot afford health insurance or experience other hardship.
Section 1311(c)(4) of the Affordable Care Act directs the Secretary to establish an enrollee satisfaction survey system that would evaluate the level of enrollee satisfaction with QHPs offered through an Exchange for each such QHP with more than 500 enrollees in the previous year.
Section 1311(d)(4)(A) of the Affordable Care Act directs that each Exchange must implement procedures for the certification, recertification, and decertification of health plans as QHPs, consistent with guidelines developed by the Secretary.
Section 1311(d)(5)(A) of the Affordable Care Act provides that States, when establishing Exchanges, must ensure that such Exchanges are self-sustaining beginning on January 1, 2015, and permits Exchanges to charge assessments or user fees to participating health insurance issuers to generate funding to support their operations. When operating an FFE under section 1321(c)(1) of the Affordable Care Act, HHS has the authority under sections 1321(c)(1) and 1311(d)(5)(A) to collect and spend such user fees. In addition, 31 U.S.C. 9701 permits a Federal agency to establish a charge for a service provided by the agency. Office of Management and Budget (OMB) Circular A-25 Revised establishes Federal policy regarding user fees and specifies that a user charge will be assessed against each identifiable recipient for special benefits derived from Federal activities beyond those received by the general public. Section 1311(d)(5)(B) contains a prohibition on the wasteful use of funds.
Section 1312(c) of the Affordable Care Act directs a health insurance issuer to consider all enrollees in all health plans (other than grandfathered health plans) offered by such issuer to be members of a single risk pool for each of its individual and small group markets. Section 1312(c) of the Affordable Care Act gives States the option to merge the individual and small group markets within the State into a single risk pool (merged market).
Section 1313 of the Affordable Care Act, combined with section 1321 of the Affordable Care Act, provides the Secretary with the authority to oversee financial integrity, compliance with HHS standards, and efficient and non-discriminatory administration of State Exchange activities. Section 1313(a)(6)(A) of the Affordable Care Act specifies that payments made by, through, or in connection with an Exchange are subject to the False Claims Act (31 U.S.C. 3729, et seq.) if those payments include any Federal funds.
Section 1341 of the Affordable Care Act establishes a transitional reinsurance program that begins in 2014 and is designed to provide issuers with greater stability as insurance market reforms are implemented and individuals begin to enroll in QHPs sold through Exchanges. Section 1342 of the Affordable Care Act establishes a temporary risk corridors program which permits the Federal government and QHPs to share in gains or losses resulting from inaccurate rate setting from 2014 through 2016. Section 1343 of the Affordable Care Act establishes a permanent risk adjustment program which is intended to provide payments to health insurance issuers that attract higher-risk populations, such as those with chronic conditions, and eliminate incentives for issuers to avoid higher-risk enrollees.
Section 1321(a)(1) of the Affordable Care Act provides general authority for the Secretary of Health and Human Services (referred to throughout this rule as the Secretary) to establish standards and regulations to implement the statutory requirements related to Exchanges, QHPs, and other components of Title I of the Affordable Care Act.
Section 1401 of the Affordable Care Act amended the Internal Revenue Code (26 U.S.C.) to add section 36B, allowing a refundable premium tax credit to help individuals and families afford health insurance coverage. Under sections 1401, 1411, and 1412 of the Affordable Care Act and 45 CFR part 155, subpart D, an Exchange will make a determination of advance payments of the premium tax credit for individuals who enroll in QHP coverage through an Exchange and seek financial assistance. Section 1402 of the Affordable Care Act provides for the reduction of cost sharing for certain individuals enrolled in a QHP through an Exchange, and section 1412 of the Affordable Care Act provides for the advance payment of these reductions to issuers.
Under section 1411 of the Affordable Care Act, the Secretary is directed to establish a program for determining whether an individual meets the eligibility standards for Exchange participation, advance payments of the premium tax credit, cost-sharing reductions, and exemptions from the shared responsibility payment under section 5000A of the Code.
Sections 1412 and 1413 of the Affordable Care Act and section 1943 of the Social Security Act (the Act), as added by section 2201 of the Affordable Care Act, contain additional provisions regarding eligibility for advance payments of the premium tax credit and cost-sharing reductions, as well as provisions regarding simplification and coordination of eligibility determinations and enrollment with other health programs.
Unless otherwise specified, the provisions in this final rule related to the establishment of minimum functions of an Exchange are based on the general authority of the Secretary under section 1321(a)(1) of the Affordable Care Act.
HHS has consulted with stakeholders on a number of polices related to the operation of Exchanges, including the SHOP and premium stabilization programs. HHS has held a number of listening sessions with consumers, providers, employers, health plans, and State representatives to gather public input. HHS consulted with stakeholders through regular meetings with the National Association of Insurance Commissioners; regular contact with States through the Exchange establishment grant process and the Exchange Blueprint approval process; and meetings with tribal leaders and
A proposed rule, titled “Patient Protection and Affordable Care Act; Program Integrity: Exchange, SHOP, Premium Stabilization Programs, and Market Standards” (78 FR 37032), was published in the
The interim final rule, titled “Patient Protection and Affordable Care Act; Amendments to the HHS Notice of Benefit and Payment Parameters for 2014” (78 FR 15541) was published in the
In this final rule, we provide a summary of each proposed or interim provision, a summary of the public comments received and our responses to them, and the provisions we are finalizing. We note that nothing in these regulations would limit the authority of the Office of the Inspector General (OIG) as set forth by the Inspector General Act of 1978 or other applicable law.
In § 144.102(c), we proposed a technical amendment to clarify whether coverage sold through associations is group or individual coverage under the PHS Act. Specifically, we proposed to delete a reference to coverage offered in connection with a “group health plan that has fewer than two participants who are current employees on the first day of the plan year” (very small plans) as being individual health insurance coverage under title XXVII of the PHS Act. This correction aligns with the amendments made by the Affordable Care Act redefining a small employer to include groups consisting of only one common law employee.
We are finalizing the amendments to § 144.102(c) as proposed.
Under § 144.103, we proposed to amend several definitions of terms that are used throughout parts 146 (group market requirements), 148 (individual market requirements), and 150 (enforcement) of subchapter B of title 45 of the Code of Federal Regulations (CFR), consistent with the Affordable Care Act. These included definitions of “group market,” “individual market,” “large employer,” “policy year,” and “small employer.” Unless otherwise provided, the definitions in § 144.103 also apply for purposes of part 147 (group and individual market insurance reform requirements), and we make this explicit in this final rule.
We noted that, although the Affordable Care Act made changes to the definition of “small employer” for purposes of the PHS Act, the Employee Retirement Income Security Act (ERISA) and the Internal Revenue Code (the Code) continue to define a “small employer” as having 2 to 50 employees. Similarly, we noted that the Affordable Care Act deleted the exception for very small plans in PHS Act section 2721,
We are finalizing the provisions proposed in § 144.103 of the proposed rule with the following minor modifications for consistency and clarity. We state expressly that the definitions in this section which are based on PHS Act requirements enacted by HIPAA and other statutes (implemented in parts 146, 148, and 150) are equally applicable to PHS Act requirements enacted by the Affordable Care Act (implemented in part 147). In the proposed definition of “policy year,” we replace the reference to January 1, 2015 with the phrase, “for coverage issued or renewed beginning January 1, 2014,” to clarify the definition's applicability to calendar year plans, as discussed in connection with § 147.104(b)(2) of this final rule. Finally, we remove the exception for certain small group health plans in § 146.145(b) to conform to the amendments in § 144.102 and § 144.103 of this final rule.
In the proposed rule, we proposed to recognize the distinction of the large group and small group segments of the group market for purposes of sections 2702 and 2703 of the PHS Act, as amended by the Affordable Care Act, and their implementing regulations at 45 CFR 147.104 and 147.106, respectively. These proposed amendments would clarify that under the guaranteed availability provisions, an issuer is required to offer to an employer only those products that are approved for sale in the applicable market segment (large group or small group market) based on the employer's group size (rather than all group market products). The proposed amendments would also clarify that under the guaranteed renewability provisions, an issuer could, in accordance with applicable State law and subject to the other requirements of § 147.106(d), elect to discontinue all products in one segment of the group market (for example, the large group market) without having to discontinue all products in the other segment of the group market (for example, small group market).
We also proposed to clarify in § 147.104(b)(2) that all non-grandfathered coverage in the individual or merged market must be offered on a calendar year basis as of January 1, 2015. We specified that, for purposes of new enrollment effective on any date other than January 1, the first policy year following such enrollment may comprise a prorated policy year ending on December 31.
For example, an employer that originally purchased coverage in the small group market and that increases in size beyond the definition of a small employer has the option of keeping the product it purchased in the small group market. Furthermore, any changes to
The requirements of guaranteed renewability do not change the underlying employer group's size for other provisions of the PHS Act and the Affordable Care Act. For example, the premium rating rules (PHS Act section 2701 and implementing regulations at § 147.102) and the single risk pool provision (Affordable Care Act section 1312(c) and implementing regulations at § 156.80) apply to health insurance coverage in the individual and small group markets, but generally do not apply to health insurance coverage in the large group market.
We are finalizing these provisions with the following minor modification. In § 147.104(b)(2), we remove the reference to January 1, 2015 to avoid unwarranted confusion as to when non-grandfathered plans in the individual or merged market must be offered on a calendar year basis. Pursuant to § 147.104(f), all non-grandfathered individual and merged market coverage issued or renewed on or after January 1, 2014 must be offered on a calendar year basis, with a policy year ending on December 31 of each year and the next policy year beginning on January 1 of the following year. The proposed rule included January 1, 2015 as the latest date by which a non-calendar year plan renewing in 2014 (i.e., a plan renewing on December 31, 2014) would be subject to this requirement. We believe the proposed text may have been subject to unintended ambiguity and are finalizing revised text to eliminate that concern.
In the proposed rule, we proposed certain provisions related to program integrity for State-operated risk adjustment and reinsurance programs, including provisions governing reporting requirements and restricting the use of reinsurance funds for administrative expenses. In addition, we proposed record retention standards for States operating risk adjustment, for contributing entities, and for reinsurance-eligible plans when HHS operates reinsurance on behalf of a State. We intend to propose additional standards related to the oversight of the premium stabilization programs in future regulations and guidance.
We also note that, to alleviate the upfront burden of the reinsurance contributions, we intend to propose in future rulemaking to collect reinsurance contributions in two installments—the reinsurance contributions for reinsurance payments and administrative expenses would be collected at the beginning of the calendar year following the applicable benefit year, and the contributions for payments to the U.S. Treasury would be collected at the end of the calendar year following the applicable benefit year. We also intend to propose in future rulemaking to exempt certain self-insured, self-administered plans from the requirement to make reinsurance contributions for the 2015 and 2016 benefit years.
We proposed an amendment to the definition of a “contributing entity” to address a situation in which the healthcare coverage provided to a participant under a group health plan is partially insured and partially self-insured—for example, if medical benefits are provided under a self-insured arrangement but prescription drug benefits are provided under an insured arrangement. We proposed this amendment to clarify that, for purposes of determining whether an entity bears liability for reinsurance contributions, a self-insured group health plan includes a group health plan that is partially self-insured and partially insured, but only where the insured coverage does not constitute major medical coverage (whether or not the self-insured coverage is major medical coverage). This amendment clarifies that if a group health plan is structured in such a manner, the group health plan would be liable for reinsurance contributions under the counting rules applicable to self-insured group health plans at 45 CFR 153.405(f), but if the insured component of the group health plan is major medical coverage, the issuer remains liable for the contributions.
We also sought comment on whether we should adopt a definition for “major medical coverage” that would provide additional clarity on when a contributing entity would have the responsibility to make reinsurance contributions.
We are finalizing the amendment to the definition of “contributing entity” as proposed.
We proposed to amend 45 CFR 153.240(c) to be consistent with the maintenance of records requirement for State-operated risk adjustment programs proposed in § 153.310(c)(4). We proposed to amend § 153.240(c) such that a State establishing a reinsurance program would be directed to maintain documents and records relating to the reinsurance program, whether paper, electronic, or in other media, for each benefit year for at least 10 years, and make them available upon request from HHS, the OIG, the Comptroller General, or their designees, to any such entity. The documents and records must be sufficient to enable HHS to evaluate whether the State-operated reinsurance program complies with Federal standards. States would also be directed to ensure that their contractors, subcontractors, and agents similarly maintain and make relevant documents and records available upon request from HHS, the OIG, the Comptroller General, or their designees.
We are finalizing the maintenance of records provision set forth in § 153.240(c) as proposed, as well as the maintenance of records provisions set forth in § 153.310(c)(4). We are also finalizing the maintenance of records provision set forth in § 153.405(h), § 153.410(c) and § 153.620(b) with conforming technical corrections. In these provisions, to conform with our other record retention standards in this rule, we are clarifying that in each provision it is the “documents and records” that must be made available upon request. In § 153.620(b), we clarify that records must be maintained for 10 years. Finally, we are making a conforming amendment to § 153.520(e) so that the risk corridors recordkeeping requirement is consistent with the foregoing provisions. Section 153.520(e) will read: “A QHP issuer must maintain documents and records whether paper, electronic, or in other media, sufficient to enable the evaluation of the issuer's compliance with applicable risk corridors standards, for each benefit year for at least 10 years, and must make those documents and records available upon request from HHS, the OIG, the Comptroller General, or their designees, to any such entity, for purposes of verification, investigation, audit or other review.”
HHS expects that States will operate the reinsurance program under section 1341 of the Affordable Care Act in an effective and efficient manner and in accordance with the provisions of subparts B and C of 45 CFR part 153.
In § 153.260(b), we proposed that a State that establishes the reinsurance program submit to HHS and make public a summary report on its reinsurance program operations for each benefit year. This report would include a summary of the accounting for the benefit year as set forth in proposed § 153.260(a).
In § 153.260(c), we proposed that a State that establishes the reinsurance program engage an independent qualified auditing entity to perform a financial and programmatic audit of the program for each benefit year in accordance with GAAS. Pursuant to § 153.260(c)(2), the State would be directed to ensure that this audit addresses the prohibitions set forth in § 153.265 (concerning improper use of reinsurance funds for administrative expenses).
In paragraph (c)(1), we proposed that the State provide to HHS the results of the independent external audit for each benefit year, and in paragraph (c)(3), we proposed that the State identify to HHS any material weakness or significant deficiency identified in the audit (as these terms are defined in GAAS issued by the American Institute of Certified Public Accountants, and Government Auditing Standards issued by the Government Accountability Office (GAO)
We are finalizing these provisions as proposed. We are finalizing these provisions with one modification. We are clarifying in paragraph (c)(4) that in making public any material weakness or significant deficiency from the external audit, the State must also make public how it intends to correct the material weakness or significant deficiency.
We are finalizing these provisions with one modification. We are clarifying that when the State makes public a summary of the results of the external audit, including any material weakness or significant deficiency, it must also make public how it intends to correct the material weakness or significant deficiency, in the manner and timeframe to be specified by HHS.
To achieve the intended purpose of the reinsurance program, reinsurance contributions collected must be spent on reinsurance payments, payments to the U.S. Treasury, and on reasonable expenses to administer the reinsurance program. In § 153.260(a), we proposed that a State operating reinsurance would be directed to keep an accurate accounting of the reinsurance funds received from HHS for administrative expenses and all the administrative expenses incurred for the State-operated reinsurance program. If a State incurs fewer expenses in operating reinsurance for a benefit year than are allocated to it under the uniform reinsurance contribution rate the State would be directed to use those funds to operate reinsurance in subsequent benefit years.
Section 1311(d)(5)(B) of the Affordable Care Act prohibits an Exchange from using any funds intended for the administrative and operational expenses of the Exchange for staff retreats, promotional giveaways, excessive executive compensation, or the promotion of Federal or State legislative and regulatory modifications. In § 153.265, we proposed to extend these prohibitions to State-operated reinsurance programs, so that a State establishing a reinsurance program would be directed to ensure that its applicable reinsurance entity did not use funds that were intended to support reinsurance program operations (including any reinsurance contributions collected under the national contribution rate for administrative expenses) for any purpose prohibited in section 1311(d)(5)(B) of the Affordable Care Act. We received comments supporting this provision.
We are finalizing this provision as proposed.
In the first Program Integrity final rule (78 FR 54070), we revised the definition of “Exchange” in § 155.20 and amended various other provisions of Part 155 to permit a State to establish and operate only a State-based SHOP while the individual market Exchange for the State is established and operated as an FFE. Because § 153.310(a)(1) provides that a State that elects to operate an Exchange is eligible to establish a risk adjustment program, when proposing these amendments, we sought comment on whether a State that elects to establish and operate a SHOP but not an individual market Exchange should also be eligible to establish a risk adjustment program. Additionally, we sought comment on whether such a State would be eligible to establish a risk adjustment program only for the small group market or would be required to establish the program for both markets. All these amendments were finalized in the first Program Integrity final rule, and we are not re-proposing or finalizing any of them in this rulemaking. However, we elected to address the comments we received on the risk adjustment options for States electing to establish and operate only a SHOP in the preamble to this final rule, rather than in the preamble to the first Program Integrity final rule.
In § 153.310(c)(4), we proposed that a State operating a risk adjustment program would be directed to maintain documents and records relating to the risk adjustment program, whether paper, electronic, or in other media, for each benefit year for at least 10 years, and make them available upon request from HHS, the OIG, the Comptroller General, or their designees, to any such entity. The documents and records must be sufficient to enable the evaluation of a State-operated risk adjustment program's compliance with Federal standards. States would also be directed to ensure that their contractors, subcontractors, and agents maintain and make those documents and records available upon request from HHS, the OIG, the Comptroller General, or their designees. We noted that a State may satisfy this standard by archiving these documents and records and ensuring that they are accessible if needed in the event of an investigation, audit, or other review. This provision is consistent with the requirements set forth in § 153.240(c), which contains record retention standards for State-operated reinsurance programs. We note that the 10-year obligation to retain records begins when the record is created.
We addressed the comments received on the proposed maintenance of records provisions in the preamble discussion of § 153.240(c) above. Below we address a comment specific to this provision.
We are finalizing this provision as proposed.
In § 153.310(d)(3), we proposed that, in addition to the requirements set forth in 45 CFR 153.310(d)(1) and (d)(2), a State would be directed to provide to HHS an interim report, in a manner specified by HHS, that includes a detailed summary of its risk adjustment activities in the first 10 months of the benefit year in order to obtain re-approval from HHS to operate risk adjustment for a third benefit year.
We proposed to amend 45 CFR 153.310(f) and re-designate it as § 153.310(d)(4). In § 153.310(d)(4), we proposed that in order to obtain re-approval from HHS to operate risk adjustment for each benefit year after the third benefit year for which it is approved, each State operating a risk adjustment program would be directed to submit to HHS and make public a detailed summary of risk adjustment program operations for the most recent benefit year for which risk adjustment operations have been completed, in the manner and timeframe specified by HHS. We proposed that the summary report must include the results of a programmatic and financial audit for the benefit year of the State-operated risk adjustment program conducted by an independent qualified auditing entity in accordance with GAAS. In § 153.310(d)(4)(ii), we proposed that the summary report would identify to HHS any material weakness or significant deficiency (as these terms are defined in GAAS issued by the American Institute of Certified Public Accountants, and Government Auditing Standards issued by the GAO
We are finalizing these provisions with minor changes in paragraph (d)(4)(ii). We are deleting references in that paragraph to HHS to make clear that any material weakness or significant deficiency identified in the audit, including the methods the State intends to use to correct any such material weakness or significant deficiency, must be made public, and not only provided to HHS.
We expect that the summary report will include a review of the State-operated program's operations over a benefit year, including the State's implementation of the risk adjustment methodology over a full payment transfer cycle. A full year of risk adjustment operations will extend beyond a benefit year because payment transfers are not determined until the year following the applicable benefit year. Therefore, the State will not need to submit this summary report until after the end of the benefit year, upon completion of the full payment transfer cycle. We will provide further details on the risk adjustment interim and summary reports in future guidance.
We are finalizing these provisions with minor changes. We are deleting references to HHS in paragraph (d)(4)(ii) to make clear that any material weakness or significant deficiency identified in the audit, including the methods the State intends to use to correct any such material weakness or significant deficiency, must be made public, and not only provided to HHS. We are also including minor conforming changes so that references to “certification” and “recertification” in connection with the evaluation of a State's operation of risk adjustment are changed to references to “approval” and “re-approval.”
To enable HHS to re-approve States to operate risk adjustment pursuant to 45 CFR 153.310(d), HHS proposed in § 153.365 that a State operating a risk adjustment program keep an accounting of all receipts and expenditures related to risk adjustment payments and charges and the administration of risk adjustment-related functions and activities for each benefit year. This accounting would be kept in accordance with GAAP, and would apply consistently to all risk adjustment-related activities. This standard is similar to the standard proposed at § 153.260(a), which applies to the reinsurance program when operated by a State. We received no comment on this proposed provision.
We are finalizing this provision as proposed.
In the 2014 Payment Notice (78 FR at 15430-34), we noted our intent to modify the risk adjustment payment transfer formula in order to accommodate community rated States that utilize family tiering rating factors. In non-family tiering States, family policy premiums must be developed by adding up the applicable rates of each individual covered under the policy, as required under 45 CFR 147.102(c)(1). In the case of families with more than three children in non-family tiering States, only the applicable rates of the three oldest covered children under age 21 are counted towards the family policy premium rate (for example, for a family with four children under age 21, only the applicable individual rates of the three oldest children would count towards the family policy premium). These family rating requirements do not apply to States that use family tiering rating factors. In family tiering States, family tiering rating factors are not required to yield premiums that are equal to the sum of the individual policy members' applicable rates, nor must they be set in a way that counts only the rates of the oldest three children under age 21 within a family policy. For example, a family tiering State could establish a family tiering rating factor of 1.0 for an adult policy, 1.8 for a policy covering one adult and one or more children, 2.0 for a policy covering two adults, and 2.8 for a policy covering two adults and one or more children.
In order to account for the differences in family rating practices between family tiering States and non-family tiering States, we proposed two changes to the risk adjustment payment transfer formula that HHS will use when operating risk adjustment on behalf of a State. These changes would only apply to States that are using family tiering rating structures. In the 2014 Payment Notice, we stated that billable members exclude children who do not count towards family rates (that is, children
Additionally, we proposed a modification to the allowable rating factor (ARF) formula that would be used for family tiering States. In the 2014 Payment Notice (78 FR at 15433), the ARF is calculated as the member month weighted average of the age factor applied to each billable enrollee. In non-family tiering States, the ARF is intended to measure the extent to which plans are increasing or decreasing their premiums based on allowable age rating factors. In the case of family tiering States, premium revenue will not vary by age-specific rating factors. Rather, policy level premiums will vary only based on the family tiering factors. In order to capture the impact of the family tiering factors on plans' premium revenue we proposed that the ARF formula for family tiering States be based on the family tiering factors instead of age rating factors.
Specifically, under our proposal, the ARF for family tiering States would be calculated at the level of the subscriber, as follows:
We noted that, apart from the changes to the billable member months definition and the ARF formula discussed above, payment transfers in family tiering States will be calculated using the formulas provided in the 2014 Payment Notice (78 FR at 15431-34). The changes to the billable member month definition and the ARF formula would not apply to States that do not implement family tiering rating factors.
We are finalizing the two proposed modifications to the risk adjustment payment transfer formula as proposed, with one technical correction. We are modifying the ARF formula by making the numerator a summation over all subscribers of the product of the family tiering factor and the subscriber member months, and the denominator the sum of billable member months.
In some health coverage arrangements, an insured group health plan may provide benefits through more than one policy to the same covered lives, where each policy standing alone does not constitute major medical coverage, but the total benefits do.
Under the proposed paragraph (a)(3), a health insurance issuer providing coverage under a group health plan would make reinsurance contributions for lives under its health insurance coverage even if the insurance coverage does not constitute major medical coverage, if: (i) The group health plan provides health insurance coverage for the same covered lives through more than one insurance policy that in combination constitute major medical coverage but individually do not; (ii) the lives are not covered by self-insured coverage of the group health plan (except for self-insured coverage limited to excepted benefits); and (iii) the health insurance coverage under the policy offered by the health insurance issuer represents a percentage of the total health insurance coverage offered in combination by the group health plan greater than the percentage offered under any of the other policies. We further proposed that for purposes of paragraph (a)(3), the percentage of coverage offered under various policies would be determined based on the average premium per covered life for these policies. In the event that the percentage of coverage is equal, the issuer of the policy that provides the greatest portion of in-network hospitalization benefits would be responsible for reinsurance contributions.
Because an issuer of group health insurance coverage that does not, by itself, constitute major medical coverage may not be aware of the existence of, or premium for, other health insurance coverage obtained by a plan sponsor covering the same lives under a group health plan, we sought comment on whether and in what circumstances an
Finally, we addressed in the proposed rule certain inquiries as to how reinsurance contribution obligations would be allocated in the case of a group health plan under which some benefit options for employees are insured by an issuer, and some options offer benefits without the involvement of an issuer in insuring the benefits (because either the group health plan or some non-issuer entity assumes the risk for that coverage option). We proposed that in such a case, if a coverage option is insured by an issuer, the issuer would be responsible for the reinsurance contribution associated with that coverage option. If an employee coverage option under such a group health plan is not insured (because either the group health plan or other non-issuer assumes the risk), we proposed that the group health plan would be responsible for the reinsurance contribution associated with that coverage option. After considering the comments received, we are modifying the proposed provisions by amending the “percentage of benefits” provision to state that the issuer of the plan that provides the greatest portion of the inpatient hospitalization benefits would be responsible for reinsurance contributions. We also are making two minor revisions to the language in proposed paragraph (a)(3) to clarify its scope.
One commenter agreed with HHS's statement in the preamble to the proposed rule that issuers may not know about other coverage purchased by a plan sponsor, so directing issuers to seek representations from plan sponsors concerning the relative percentage of coverage offered by the issuer was reasonable. The commenter suggested that issuers be able to rely on employer representations regarding other coverage, and that issuers be held harmless from compliance actions if they do not receive such information from employers, or if the information is inaccurate. However, another commenter stated that plans or plan sponsors should not be required to provide information to issuers and that a rule that “looks to the types of coverage provided” is appropriate. One commenter requested clarification on which entity would be liable for reinsurance contributions where a group health plan has two insured major medical components offered by different issuers. The commenter stated that some States prohibit HMOs from providing out-of-network coverage for non-emergency services. HMOs in those States package their in-network coverage with out-of-network coverage issued by a non-HMO health insurance issuer, so that enrollees in the HMO have simultaneous coverage under both products. The commenter suggested that the rule should provide the issuer of the in-network coverage (the HMO, which would be expected to account for the majority of the total health coverage under the group health plan) is responsible for reinsurance contributions.
In general, it is our intent not to require payment of reinsurance contributions more than once for the same covered life. We recognize that certain complex group health plan arrangements can lead to situations in which lives are covered multiple arrangements and where it is unclear whether more than one health plan or issuer must make reinsurance contributions on the same covered life.
To provide clarity on the matter, we intend to clarify in future rulemaking the principle that reinsurance contributions are required only once with respect to the same covered life. We also intend to propose that no reinsurance contributions are required under a group health plan where the group health plan coverage applies to lives that are also covered by individual market health insurance coverage for which reinsurance contributions are required, or where the coverage is supplemental or secondary to group health coverage for which reinsurance contributions must be made for the same covered lives.
We are finalizing the reinsurance contribution provision discussed above as proposed, with the following modifications. We are modifying the “percentage of benefits” provision to state that the issuer of the plan that provides the greatest portion of the inpatient hospitalization benefits will be responsible for reinsurance contributions. We also are making two minor revisions to language in proposed paragraph (a)(3) to clarify its scope.
To meet our obligation to safeguard Federal funds, we proposed to amend § 153.405 by adding paragraph (h), which would require a contributing entity to maintain documents and records, whether paper, electronic, or in other media, that are sufficient to substantiate the enrollment count submitted under § 153.405 for at least 10 years, and would direct the contributing entity to make that evidence available upon request from HHS, the OIG, the Comptroller General, or their designees, for the purpose of verifying reinsurance contribution amounts. We also proposed to amend § 153.410 by adding paragraph (c), which would direct an issuer of a reinsurance-eligible plan in a State where HHS operates reinsurance to maintain documents and records, whether paper, electronic, or in other media, sufficient to substantiate the requests for reinsurance payments made pursuant to § 153.410 for at least 10 years, and would require the issuer to make that evidence available upon request from HHS, the OIG, the Comptroller General, or their designees, (or, in a State where the State is operating reinsurance, the State or its designee) for the purpose of verifying reinsurance payment requests. We note that these standards could be satisfied if the contributing entity or issuer of a reinsurance-eligible plan archived the documents and records and ensured that they were accessible in the event of an investigation, audit, or other review. We note that the 10-year obligation to retain records begins when the record is created.
We addressed the comments received on the proposed maintenance of records provisions in the preamble discussion related to § 153.240(c) above.
We are finalizing these provisions as proposed, with one clarification in each provision to conform with the other record retention standards in this rule. We are clarifying that in each provision it is the “documents and records” that must be made available upon request.
Section 1342(a) of the Affordable Care Act provides that “a qualified health plan offered in the individual or small group market” is to participate in the risk corridors program. In the Exchange Establishment Rule, we stated that a stand-alone dental plan is “a type of qualified health plan.” However, we did not intend for all requirements applicable to a QHP to apply to stand-alone dental plans. For example, under 45 CFR 155.1065(a)(3), certain QHP standards are not applicable to a stand-alone dental plan if they cannot be met, given the limited benefit package offered by the plan. We believe that it would not be appropriate to subject stand-alone dental plans to the risk corridors program because such plans are considered excepted benefits plans under section 2791(c) of the PHS Act, and are therefore not subject to the rating rules—that is, the Federal prohibition on underwriting premiums, the requirement to base premium rating using the single risk pool, and the fair health insurance premiums limitations. Thus, although States have the option to prohibit underwriting for excepted benefits plans, and issuers of stand-alone dental plans may voluntarily choose not to underwrite these plans, we believe that, in general, an issuer of a stand-alone dental plan will not be subject to the same rate-setting uncertainty in 2014 as the issuer of a major medical plan, and will not need the risk-sharing protections of risk corridors.
We are finalizing this policy as proposed, and are adding a new paragraph (e) to § 153.510, which provides that a QHP issuer is not subject to the provisions under subpart F of part 153 with respect to a stand-alone dental plan.
In the interim final rule (78 FR 15541), we noted that, consistent with the single risk pool provision at 45 CFR 156.80, which directs an issuer to pool claims costs across all of its non-grandfathered health plans in a market within a State, a QHP issuer must pool allowable costs across all its non-grandfathered plans in the relevant market for the purposes of risk corridors calculation. We therefore amended the regulatory definition of “allowable costs” for purposes of the risk corridors program so that allowable costs for a QHP are equal to the pro rata portion of the QHP issuer's incurred claims. We also modified the provision related to attribution and allocation of revenue and expense items in 45 CFR 153.520 to conform to the changes for the risk corridors calculation described above.
We are finalizing the policy set forth in the interim final rule with respect to the definition of “allowable costs,” and are making a number of modifications to maintain consistency with this policy in response to comment, as described below.
We agree with the comment that it is inconsistent to disconnect the projected claims used to develop premiums used to calculate the risk corridor target amount from the incurred claims used to develop the allowable costs, and are therefore modifying our risk corridors expense allocation rules at 45 CFR 153.520 to ensure that the numerator and the denominator of the risk corridors calculation are calculated in a fully consistent manner. We are revising the risk corridors allocation rules in § 153.520 to clarify that administrative expenses in the target amount, like allowable costs, should be calculated based on expenses across all non-grandfathered health plans in the market, and allocated pro rata to a QHP based on the QHP's premiums. Because certain administrative expenses, such as Exchange user fees are, like incurred claims costs, required to be spread across the relevant risk pool, their treatment should conform with the market-wide risk corridors calculation for allowable costs and premiums. Thus, we are clarifying that administrative expenses should be similarly allocated. We note that this change is consistent with our intention to align the risk corridors calculation with the single risk pool provision, will further align the calculations for the MLR and risk corridors programs, and will reduce the burden on issuers of allocating expenses on a plan-by-plan basis.
Finally, we are also making conforming corrections to the risk corridors data requirements in § 153.530(b) and (c) to specify that issuers must submit risk corridors data in a manner that is consistent with the calculation of allowable costs and allowable administrative costs, as defined at § 153.500. We provide that a QHP issuer must submit to HHS data on allowable costs and allowable administrative costs incurred for all of its non-grandfathered plans in a market within a State. Without these corrections, issuers would be required to make plan-specific allocations and submit plan-specific amounts that are not necessary for the risk corridors calculation, while not providing the QHP aggregate premium data required for the risk corridors calculation as amended. We believe that these corrections will alleviate potential confusion among issuers with regard to submission of pooled risk corridors data.
We are finalizing the definition of “allowable costs” in § 153.500 without change. We are modifying § 153.520(a) and (b) to provide that expenses in the target amount of the risk corridors calculation should be based on market-wide expenses, and must be allocated across a QHP issuer's plans in proportion to the plans' premiums. Finally, we are making conforming modifications to the risk corridors data requirements in § 153.530(b) and (c) to require a QHP issuer to submit data on allowable costs and allowable administrative costs for its non-grandfathered health plans in a market within a State.
We proposed to amend § 153.620(b) to add a standard that would direct an issuer that offers risk adjustment covered plans to maintain documents and records, whether paper, electronic, or in other media, sufficient to enable the evaluation of the issuer's compliance with applicable risk adjustment standards, and to make that evidence available upon request from HHS, the OIG, the Comptroller General, or their designees (or in a State where the State is operating risk adjustment, the State or its designee), to any such entity. This standard, which is consistent with other records maintenance standards in this rule, would direct an issuer of a risk adjustment covered plan to retain additional records—not only those pertaining to data validation—to substantiate its compliance with risk adjustment standards, whether risk adjustment is operated by HHS or a State.
We addressed the comments received on the proposed maintenance of records provisions in the preamble discussion of § 153.240(c) above.
We are making two corrections to this provision, to conform with our other record retention provisions throughout this rule. We are clarifying that it is the “documents and records” that must be made available upon request. We are also clarifying that documents and records must be maintained for each benefit year, for at least 10 years.
In § 153.740(a), we proposed that HHS may pursue an enforcement action for CMPs against an issuer in a State where HHS operates the reinsurance or risk adjustment program, if the issuer fails to: (a) Establish a secure, dedicated distributed data environment pursuant to 45 CFR 153.700(a); (b) provide HHS with access to enrollee-level plan enrollment information, enrollee claims data, or enrollee encounter data through its dedicated distributed data environment pursuant to 45 CFR 153.710(a); (c) otherwise comply with the requirements of 45 CFR 153.700 through 153.730; (d) adhere to the reinsurance data submission requirements set forth in 45 CFR 153.420; or (e) adhere to the risk adjustment data submission and data storage requirements set forth in 45 CFR 153.610 through 153.630. As discussed above, under the data collection approach that we are implementing when we operate risk adjustment or reinsurance on behalf of a State, an issuer must use masked enrollee identification numbers when making data accessible through the dedicated distributed data environment. In addition, we will not store any personally identifiable enrollee information or individual claim-level information from the data that issuers make accessible to HHS through the dedicated distributed data environment except when conducting data validation or audits.
To clarify our 2014 policy of nonenforcement of CMPs for good faith, we are adding a new sentence to § 153.740(a).
As described in the Premium Stabilization Rule (77 FR 17220) and the 2014 Payment Notice (78 FR 15410), HHS will employ a distributed data collection approach when it operates a risk adjustment program on behalf of a State. Under this approach, issuers in States where HHS operates a risk adjustment program will be required to establish dedicated, secure data environments, and provide HHS with access to “masked”
As discussed in the proposed rule, if an issuer does not set up a dedicated distributed data environment or submits inadequate risk adjustment data, HHS would not have the required risk adjustment data from the issuer to calculate risk scores or payment transfers. This data is necessary to properly calculate risk adjustment payments and charges for the entire applicable market for the State. If HHS cannot perform this calculation for a particular issuer, risk adjustment payment transfers would be affected for all other issuers in the State market because payment transfers are determined within a market within a State such that they will net to zero. In the proposed rule, we invoked our
In § 153.740(b), we proposed that if an issuer of a risk adjustment covered plan fails to establish a dedicated distributed data environment or fails to provide HHS with access to risk adjustment data in such environment by April 30 of the year following the applicable benefit year in accordance with §§ 153.610(a), 153.700, 153.710, or 153.730, such that HHS cannot apply its Federally certified risk adjustment methodology to calculate the plan's risk adjustment payment transfer amount in a timely fashion, HHS would assess a default risk adjustment charge.
We proposed two different methods for determining the per member per month amount used to calculate the default risk adjustment charge. One option would be to use the highest per member per month charge among risk adjustment covered plans in a risk pool in the market in the plan's geographic rating area. A second option would be to use a per member per month amount that is two standard deviations above the mean charge in the market in the plan's geographic rating area.
We noted in the proposed rule that in order to calculate a plan's risk adjustment default charge, we must multiply the per member per month amount by an enrollment count. We proposed to base the default charge on the average enrollment in the State market. If enrollment data is provided, we proposed that the default charge would be based on average annual enrollment for the plan in a risk pool in the State market. We sought comment on these methods, other appropriate methods for calculating a default risk adjustment charge, and other sources of data HHS could use to determine enrollment data for the issuers in question. We also sought comment on whether to allocate an issuer's default charge to other issuers in the market as part of payments and charges in the concurrent benefit year, during a subsequent benefit year, or sometime between annual payments and charges processes.
We received a number of comments strongly supporting our proposal to impose a default risk adjustment charge if an issuer of a risk adjustment covered plan fails to establish a dedicated distributed data environment or fails to provide HHS with access to the required data. We are finalizing that regulation text as proposed.
We are finalizing our regulation text providing the authority to impose a default risk adjustment charge as proposed. We are finalizing aspects of the methodology for calculating the default risk adjustment charge—our use of the plan's actual enrollment and our application of the default risk charge to adjust payments to other plans in the market in the State on a per member per month basis in the earliest available payment and charges cycle. We are not finalizing our approach to determining the per member per month amount used to calculate the default risk charge at this time, and will propose that methodology in future rulemaking.
We proposed to amend § 155.340 by adding paragraph (h), which sets forth additional requirements applicable when an Exchange is facilitating the collection and payment of premiums to QHP issuers and stand-alone dental plans. Specifically, we proposed that if the Exchange did not reduce an enrollee's premium by the amount of the advance payment of the premium tax credit in accordance with 45 CFR 155.340(g), the Exchange would be required to refund to the enrollee any excess premium paid by or for the enrollee. The Exchange would also be required to notify the enrollee of the improper application of the advance payment of the premium tax credit no later than 30 calendar days after the Exchange discovers the error. We noted that an Exchange may provide the refund to the enrollee by reducing the enrollee's portion of the premium in the following month, as long as the reduction is provided no later than 30 calendar days after the Exchange discovers the improper application of the advance payment of the premium tax credit. We proposed that if the Exchange elects to provide the refund by reducing the enrollee's portion of the premium for following month, and the refund exceeds the enrollee's portion of the premium for the following month, then the Exchange would need to refund to the enrollee the excess, no later than 30 calendar days after the Exchange discovers the improper application of the advance payment of the premium tax credit. These provisions are similar to the policy we proposed in § 156.460, when a QHP issuer is collecting premiums directly from enrollees. We also noted that we were considering requiring the Exchange to provide to HHS for each quarter, a report detailing the occurrence of any improper application of the advance payments of the premium tax credit beginning in the 2015 benefit year. We sought comment on whether HHS should establish a minimum error rate or threshold before an Exchange is required to inform HHS of such improper applications of the advance payment of the premium tax credit in a quarterly report, as well as what an appropriate error rate or threshold should be. For example, we noted that we were considering requiring issuers to report the number of enrollees for whom the Exchange improperly applied the advance payment of the premium tax credit compared to the total number of enrollees in the Exchange receiving Federal premium subsidies. We also sought comment on whether such reports should be provided to HHS less frequently than quarterly.
As a discussed above, this provision applies when an Exchange facilitates collection and payment of the premiums to QHP issuers and stand-alone dental plans on behalf of an enrollee and collects a greater premium from the enrollee than required by the issuer, taking into account the advance payment of the premium tax credit. As an intermediary in this process, if the Exchange collects excess premiums from the enrollee on behalf of the issuer, it should be responsible for recouping the overpayments from the issuer and returning the funds to the enrollee. This standard would not prevent an Exchange for recouping excess funds, in the event the Exchange reduced the enrollee's portion of the premium by more than the advance payment of the premium tax credit. We also note that State Exchanges may not use funding for States establishing an Exchange provided under Section 1311 of the Affordable Care Act for such refunds.
We are finalizing the proposed provisions with the following modifications. We are increasing the time period for notifying the enrollee of the improper application of the advance payment of the premium tax credit and issuing refunds from 30 days to 45 days. We are also providing that the Exchange may issue the refund by applying the total excess premium paid by or for the enrollee to the enrollee's portion of the premium each month for the remainder of the period of enrollment or benefit year until the excess premium is fully refunded, except that the Exchange must refund any remaining excess premium, within 45 days of a request by or for the enrollee for the refund or within 45 days of the end of the period of enrollment or benefit year.
In § 155.420 we proposed to amend § 155.420(d) to provide that a special enrollment period will be available when the Exchange determines that a consumer has been incorrectly or inappropriately enrolled in coverage due to misconduct on the part of a non-Exchange entity. Specifically we proposed to add a new paragraph § 155.420(d)(10) to create this new special enrollment period for qualified individuals. This amendment would extend a special enrollment period to a qualified individual when, in the determination of the Exchange, misconduct on the part of a non-Exchange entity has caused the qualified individual to be enrolled incorrectly or inappropriately in coverage such that they are not enrolled in QHP coverage as desired, are not enrolled in their selected QHP, or have been determined eligible for but are not receiving advance payments of the premium tax credit or cost-sharing reductions. We proposed to limit this special enrollment opportunity to the individual market Exchange and not extend it to the SHOPs.
We proposed that a non-Exchange entity providing enrollment assistance or conducting enrollment activities would include, but not be limited to, those individuals and entities that are authorized by the Exchange to assist with enrollment in QHP, such as a Navigator, as described in § 155.210; non-Navigator assistance personnel, as authorized by § 155.205(d) and (e); a certified application counselor, as described in § 155.225; an agent or broker assisting consumers in an Exchange under § 155.220; issuer application assisters under § 155.415; or a QHP conducting direct enrollment under § 156.1230.
We are finalizing the provision proposed in § 155.420(d)(10) with amendments reflecting our decision to extend the special enrollment period to SHOPs, and with a minor correction to remove “of this subchapter” following “part 156” from the proposed regulation text.
In section II.D.2 of this final rule, we describe our decision, made in response to comment, to extend to SHOPs the new special enrollment period that will be available when the Exchange determines that a consumer has been incorrectly or inappropriately enrolled in coverage due to misconduct on the part of a non-Exchange entity. Accordingly, we are making a conforming amendment to § 155.725(j)(2)(i) to add a cross-reference to § 155.420(d)(10), the new special enrollment period.
We proposed that the State Exchange maintain an accounting of all its receipts and expenditures, in accordance with GAAP. We also proposed that the State Exchange develop and implement a process for monitoring all Exchange-related activities for effectiveness, efficiency, integrity, transparency, and accountability. We stated our belief that these activities would help to ensure State Exchange compliance with Federal requirements as set forth in Part 155 and ensure the appropriate administration of Federal funds, including advance payment of the premium tax credit and cost-sharing reductions.
In § 155.1200(b), we proposed that the State Exchange submit several types of reports to HHS. The State Exchange would submit at least annually a report to allow for transparency of State Exchange activities. The report must include a financial statement presented in accordance with GAAP. The report is due to HHS by April 1 of each year. Additionally, the State Exchange must submit reports in a form and manner to be specified by HHS regarding eligibility and enrollment. These reports will focus on eligibility determination errors, non-discrimination safeguards, accessibility of information, and fraud and abuse incidences. The State Exchange must also submit performance monitoring data that includes financial sustainability, operational efficiency, and consumer satisfaction. We sought comments on our approach, including comments on the content, format, and timing of such reports.
In § 155.1200(c) we proposed that the State Exchange engage an independent qualified auditing entity, whether governmental or private, which meets accepted professional and business standards and follows generally accepted governmental auditing standards (GAGAS) to perform an independent external financial and programmatic audit of the State Exchange. This entity should be selected to avoid any real or potential perception of conflict of interest, including being free from personal, external and organizational impairments to independence or the appearance of such impairments of independence. We stated that an external audit will help ensure the consistency and accuracy of State Exchange financial reporting and program activities. We proposed that this requirement may be satisfied through an audit by an independent State-government entity. We proposed that the State Exchange will submit to HHS, concurrent with the annual report, the results on the audit along with proposals on how it will remedy any material weakness or significant deficiency (the terms “material weakness” and “significant deficiency” are defined in OMB Circular A-133, Audits of States, Local Governments and Non-Profit Organizations).
In § 155.1200(d) we proposed that independent audits address specific processes and activities of State Exchanges including financial and programmatic activities and those related to the verification and determination of applicants' eligibility for enrollment in the State Exchanges and the subsequent enrollments. We also proposed that the external audit address whether the Exchange is complying with § 155.1200(a)(1) by keeping an accurate accounting of Exchange receipts and expenditures in accordance with generally accepted accounting principles (GAAP). We also proposed that external audits and annual reports required under paragraphs (b) and (c) address State Exchange processes and procedures to comply with the standards for Exchanges under Part 155 related to advance payments of the premium tax credits and cost-sharing reductions. These standards include the requirements under subpart D regarding eligibility determinations, including the requirements regarding the confidentiality, disclosure, maintenance, and use of information as set forth in 45 CFR 155.302(d)(3); subpart E regarding individual market enrollment in QHPs; and subpart K regarding QHP certification. We also proposed that such audits and annual reports assess whether a State Exchange has processes and procedures in place
The performance monitoring data provide insight into the performance and impact of State Exchanges, including the cost of insurance, the scope of coverage, and access issues. This limited set of standardized metrics also ensures basic transparency and allows consistent cross-state comparisons of the impacts of varying approaches to State Exchange implementation. We anticipate providing further guidance on the format and timing of the reports, as well as, whether the public will have access to them.
We are finalizing the provisions proposed in § 155.1200 with the following modification. As discussed in II.D.1.a of this final rule, if the Exchange is collecting premiums under 45 CFR 155.240, we are adding subparagraph (b)(4) to require the Exchange to annually report if it did not reduce an enrollee's premium by the amount of the advance payment of the premium tax credit in accordance with 45 CFR 155.340(g)(1)-(2). In paragraph (c) we are adding a requirement that the State make public a summary of the results of external financial audit.
We proposed that State Exchanges and its contractors, subcontractors, and agents maintain records for 10 years, including documents and records (whether paper, electronic, or other media) and other evidence of accounting procedures and practices of the State Exchanges to prepare for targeted audits. We stated that these records must be sufficient and appropriate to respond to any periodic auditing, inspection, or investigation of the State Exchange's financial records or to enable HHS or its designee to appropriately evaluate the State Exchange's compliance with Federal requirements. We anticipate that targeted audits will be conducted based on information from the external audit, annual report, prospective measurement programs of improper payments, consumer complaints, or other data sources. In addition, we proposed that the State Exchange must make all records of this section available to HHS, the OIG, the Comptroller General, or their designees, upon request.
We are finalizing the provisions proposed in § 155.1210, and note that the 10 year record retention requirement begins when the record is created.
We proposed amending 45 CFR 156.20 by adding the definition for “Enrollee satisfaction survey vendor” and “Registered user of the enrollee satisfaction survey data warehouse.”
We are making a technical correction to our regulation text, which inadvertently left out the word “that” from the definition. The definition for “enrollee satisfaction survey vendor” should begin, “an organization that has . . .”
We received no comments in regards to these definitions, and finalize these definitions as proposed, but with the technical corrections as mentioned above.
We are finalizing this provision as proposed.
To ensure consistency with rate setting schedules in the Exchanges and thus reduce the risk of adverse selection, we proposed in § 156.80 to add paragraph (d)(3) to clarify when issuers may establish and update premium rates under the single risk pool requirements. Specifically, in paragraph (d)(3)(i), we proposed that issuers in the individual market or in a market in which the individual and small group risk pools were merged by the State would be permitted to make changes to their market-wide adjusted index rate and plan-specific pricing on an annual basis. In paragraph (d)(3)(ii), we proposed that issuers in the small group market would be permitted to make such changes on a quarterly basis once the Federally-Facilitated Small Business Health Options Program's (FF-SHOP) capability to process quarterly rate updates is established. Until that time, we proposed that issuers in the small group market may make changes to rates no more frequently than annually.
We are finalizing the provisions proposed in § 156.80 of the proposed rule with the following modifications. We are revising existing paragraph (d)(1) to provide that an index rate must be established and effective for a State market (individual, small group, or merged market) by January 1 of each calendar year. We are also restructuring proposed paragraph (d)(3) to clearly state that an issuer is prohibited for making index rate and plan-level adjustments on any basis other than annually, except in the small group market once quarterly rate changes are permitted. We also now clearly state the effective dates of quarterly rate updates in the small group market.
We are making a technical correction to our regulation text in § 156.155, which inadvertently omitted the statutory language in section 1302(e) of the Affordable Care Act indicating that a catastrophic plan provides “no benefits” for any plan year (except for providing coverage for at least 3 primary care visits and preventive health services in accordance with section 2713 of the PHS Act) until the individual has incurred cost-sharing expenses in an amount equal to the annual limitation on cost sharing in effect under section 1302(c)(1) of the Affordable Care Act. Although this provision was not addressed in the proposed rule, it is part of the law governing benefits under catastrophic plans, and we believe it is appropriate to revise the regulation text in this final rule to reflect this fact.
In § 156.330, we proposed that when a QHP issuer in the FFE undergoes a change in ownership, it notify HHS of the change at least 30 days prior to the date of the change and provide the legal name and taxpayer identification number (TIN) of the new owner, as well as the effective date of the change. We also proposed that the new owner must agree to adhere to applicable statutes and regulations.
We are finalizing this section as proposed.
Section 156.400 of this subpart includes definitions of a “most generous,” and a “more generous,” plan variation. We proposed to supplement those definitions by clarifying that the definitions of a “least generous,” and a “less generous,” plan variation have the opposite meanings of the existing definitions of a “most generous,” or a “more generous” plan variation. Specifically, we proposed that, as between two plan variations (or a plan variation and a standard plan without cost-sharing reductions), the plan variation or standard plan without cost-sharing reductions designed for the category of individuals first listed in 45 CFR 155.305(g)(3) would be deemed the less generous one. The term less generous was used in the proposed rule to address circumstances in which a QHP issuer would reassign an enrollee from a more generous plan variation to a less generous plan variation (or standard plan without cost-sharing reductions), as discussed in greater detail below. We also proposed a technical modification to change “QHP or plan variation” to “standard plan or plan variation” to clarify that a plan variation is not distinct from a QHP. We received no comments on these proposed provisions and are finalizing these provisions as proposed.
In § 156.410, we proposed to add new paragraphs (c) and (d) to specify the actions a QHP issuer would take if it does not provide the appropriate cost-sharing reductions to an individual, or if it does not assign an individual to the appropriate plan variation (or standard plan without cost-sharing reductions) in accordance with § 156.410(a) through (b) or § 156.425(a) through (b) of this subpart.
Specifically, in paragraph (c)(1), we proposed that if a QHP issuer fails to ensure that an individual assigned to a QHP plan variation receives the cost-sharing reductions required under the applicable plan variation (taking into account the requirement regarding cost sharing previously paid under other plan variations of the same QHP under § 156.425(b) if applicable), the QHP would notify the enrollee of the improper application of the cost-sharing reductions and refund any excess cost sharing paid by or for the enrollee during such period no later than 30 calendar days after discovery of the improper application of the cost-sharing reductions. This refund would be paid to the person or entity that paid the excess cost sharing, whether the enrollee or the provider.
In paragraph (c)(2), we proposed that if a QHP issuer provides an enrollee assigned to a plan variation with greater cost-sharing reductions than required under the applicable plan variation (taking into account § 156.425(b) concerning continuity of deductibles and out-of-pocket amounts if applicable) then the QHP issuer will not be eligible for reimbursement of any excess cost-sharing reductions provided to the enrollee, and may not seek reimbursement from the enrollee or the provider for any of the excess cost-sharing reductions. Because the QHP issuer is responsible for ensuring the cost-sharing reduction is provided appropriately, we noted that we do not believe that the QHP issuer should be able to recoup overpayments of cost-sharing reductions that resulted from the QHP issuer's own errors.
In paragraph (d), we proposed that if a QHP issuer improperly assigns an enrollee to a plan variation (or standard plan without cost-sharing reductions), or does not change the enrollee's assignment due to a change in eligibility in accordance with § 156.425(a), in each case, based on the eligibility and enrollment information or notification provided by the Exchange, then the QHP issuer would, no later than 30 calendar days after discovery of the improper assignment, reassign the enrollee to the applicable plan variation (or standard plan without cost-sharing reductions) and notify the enrollee of the improper assignment.
Conversely, paragraph (d)(2) proposed that, if a QHP issuer reassigns an enrollee from a less generous plan variation (or a standard plan without cost-sharing reductions) to a more generous plan variation of a QHP to correct an improper assignment on the part of the issuer, the QHP issuer would recalculate the individual's liability for cost sharing paid between the effective date of eligibility required by the Exchange and the date on which the issuer effectuated the change. The QHP issuer would refund any excess cost sharing paid by or for the enrollee during such period, no later than 30 calendar days after discovery of the incorrect assignment. This refund would be paid to the person or entity that paid the excess cost sharing, whether the enrollee or the provider. We sought comment on the proposed approach, including the 30-calendar-day timeframe for QHP issuers to reassign an individual to the correct plan variation and refund any excess cost sharing paid by or for the enrollee. We also sought comment on whether the timeframe should depend on the point in the month the issuer discovers the improper assignment, considering the amount of time issuers may require to effectuate the reassignment, as well as the impact on enrollees due to a delay in reassignment. We noted that the date of the reassignment would not affect the initial effective date of eligibility, and that the enrollee would still be refunded any excess cost sharing paid by or for the enrollee between the effective date of eligibility and the date of the reassignment.
We also noted that we were considering requiring that, for each quarter, a QHP issuer provide to HHS and the Exchange a report beginning in the 2015 benefit year detailing the occurrence of any improper applications of cost-sharing reductions in violation of the standards finalized and proposed in § 156.410(a) and (c) and § 156.425(b), as well as instances when it did not refund any excess cost sharing paid by or for an enrollee in accordance with proposed § 156.410(c)(1) and § 156.410(d)(2), or was reimbursed for excess cost sharing provided in violation of proposed § 156.410(d)(1).
We are finalizing these provisions with the following modifications. We are amending paragraphs (c) and (d) to increase the time period for issuing refunds from 30 days to 45 days of discovery of the error. We are also modifying these paragraphs to provide that the QHP issuer may provide the refund by applying the total excess cost sharing paid by or for the enrollee to the enrollee's portion of the premium for the remainder of the period of enrollment or benefit year until the excess is fully applied, except that the QHP issuer must refund the enrollee the excess cost sharing within 45 days of the enrollee's request or the end of the period of enrollment or benefit year. (Any cost-sharing paid by the provider will still be refunded to the provider within 45 days of discovery of the error.) Additionally, we are re-designating subparagraphs (d)(1) and (d)(2) as (d)(3) and (4), and adding two new subparagraphs (d)(1) and (d)(2), which set forth a timeframe for effectuating a reassignment to the correct plan variation.
In the 2014 Payment Notice, we established a payment approach under which monthly advance payments will be made to QHP issuers to cover projected cost-sharing reduction amounts, and then, after the close of the benefit year, the advance payments and the actual cost-sharing reduction amounts provided during the benefit year will be reconciled. In 45 CFR 156.430(c)(1), we established standards for QHP issuers to submit data to HHS detailing the amount of cost sharing the enrollees in each plan variation paid, as well as the amount of cost sharing the enrollees would have paid under the standard plan. The value of the cost-sharing reductions provided is the difference of these two amounts. We also finalized at 45 CFR 156.430(c)(2) a methodology (referred to as the “standard methodology”) for calculating the amount of cost sharing that the enrollees would have paid under the standard plan, but for the cost-sharing reductions. Under the standard methodology, QHP issuers apply the cost-sharing requirements for the standard plan to the allowed costs for each plan variation policy; in effect, each claim would be processed twice: once using the cost-sharing structure that would have been in place if the individual were ineligible for cost-sharing reductions, and once using the reduced cost-sharing structure in the applicable plan variation for which the individual is eligible.
In the Amendments to the HHS Notice of Benefit and Payment Parameters for 2014 interim final rule, we established in § 156.430(c)(4) an alternate methodology for calculating the amount of cost sharing that the enrollees would have paid under the standard plan for the purpose of reconciliation of the advance payments of the cost-sharing reductions. Under this alternate methodology (referred to as the “simplified methodology”), QHP issuers calculate the amount of cost sharing that the enrollees would have paid under the standard plan by using formulas based on certain summary cost-sharing parameters of the standard plan, applied to the total allowed costs for each policy. With this approach, we sought to balance the need to safeguard Federal funds with the goal of lessening the administrative burden on QHP issuers. We stated that we anticipated that after an appropriate transition period, all QHP issuers would be required to use the standard methodology, and sought comments on how long the transition period should be. We also noted that in later years, we would consider alternative approaches for reimbursing QHP issuers. For example, once more data is available, we could change to a capitated payment system as permitted in section 1402(c)(3)(B) of the Affordable Care Act. However, such a change would require access to data on the utilization and cost-sharing patterns of individuals eligible for cost-sharing reductions.
In § 156.430(c)(3)(i) of the interim final rule, we provided that a QHP issuer must notify HHS prior to the start of each benefit year whether or not it is selecting the simplified methodology for the benefit year. In paragraph (c)(3)(ii), we specified that if the QHP issuer selects the simplified methodology, it must apply the simplified methodology to all plan variations it offers on the Exchange for a benefit year. Since the simplified methodology is intended for issuers whose systems are not yet capable of implementing the standard methodology, in paragraph (c)(3)(iii) we specified that the QHP issuer may not select the simplified methodology if it did not select the simplified methodology for the prior benefit year. We also set forth standards governing the selection of a methodology if a QHP issuer merges with or acquires another QHP issuer on the Exchange, or acquires a QHP offered on the Exchange from another issuer. In paragraph (c)(3)(iv), we provided that if each of the affected parties had selected a different methodology for the benefit year, then
In this final rule, we are generally finalizing the standards related to the simplified methodology as established in the interim final rule, with minor clarifying edits to paragraph (c)(3)(iii) and (iv), and we are modifying paragraph (c)(3) to specify that QHP issuers may only choose to use the simplified methodology for benefit years 2014 through 2016. For the 2014 benefit year, HHS intends to contact each QHP offering individual market coverage through an Exchange in November, which will prompt the issuer to notify HHS prior to the start of the benefit year whether or not it selects the simplified methodology for the benefit year. We received a number of comments on the selection of the methodology and the transition period.
In § 156.430(c)(4) of the interim final rule we set forth a simplified methodology for calculating the amount of cost sharing that enrollees would have paid under the standard plan without cost-sharing reductions. We established that a QHP issuer selecting the simplified methodology must calculate the amount that the enrollees would have paid under the standard plan by applying four summary, or “effective cost-sharing parameters” for the standard plan—the effective deductible, the effective pre-deductible coinsurance rate, the effective post-deductible coinsurance rate, and the effective claims ceiling—to the total allowed costs paid for EHB under the policy (that is, the policy with cost-sharing reductions) for the benefit year. This simplified methodology allows QHP issuers to calculate enrollee liability under the standard plan using a standardized methodology that does not require complex readjudication of claims. Specifically, in § 156.430(c)(4)(i), we detailed the process for calculating the amount that enrollees would have paid under the standard plan under the simplified methodology, depending on the utilization pattern under the policy. We described these calculations using Formulas A, B, and C, detailed in § 156.430(c)(4)(i)(A), (B) and (C). In § 156.430(c)(4)(ii) (renumbered as (c)(4)(iii) in this final rule), we defined the effective cost-sharing parameters for the standard plan, and established that these parameters must be calculated separately for self-only coverage and other than self-only coverage. We also noted that if a QHP issuer has entirely separate cost-sharing parameters for pharmaceutical and medical services, the QHP issuer may elect to develop separate sets of effective cost-sharing parameters for pharmaceutical and medical services.
We sought comments on these effective cost-sharing parameters and formulas for calculating the amount that enrollees would have paid under the standard plan, and whether this methodology appropriately categorizes policies based on utilization patterns. We also sought suggestions for alternative methodologies that might provide more accurate estimates of the amount that enrollees would have paid under the standard plan, while preserving the administrative efficiency of the simplified methodology. In response to comments, we are generally finalizing the simplified methodology as established in the interim final rule, with some modifications to address unique benefit structures and to reduce potential biases in the formulas identified by commenters. We are also clarifying how QHP issuers should calculate the effective cost-sharing parameters for self-only coverage, other than self-only coverage, medical coverage, and pharmaceutical coverage. Lastly, we are clarifying how the simplified methodology should apply when an enrollee is assigned to a different plan variation or is assigned from a plan variation to the standard plan (or vice versa) during the course of the benefit year.
Specifically, three commenters noted that the effective deductible and effective claims ceiling parameters, as established in the interim final rule, may result in the overestimation or underestimation of enrollee liability under a standard plan with certain benefit structures. For example, because the effective deductible was defined as the weighted average of the deductibles for the standard plan, excluding services not subject to the deductible, Formula B (described in § 156.430(c)(4)(i)(B)) may overestimate the cost sharing under the standard plan for those enrollees who incur claims costs greater than the effective deductible, because they receive services that are not subject to the deductible. In addition, because the effective claims ceiling was calculated based on the annual limitation on cost sharing, which may only apply to in-network benefits (as described in 45 CFR 156.130(c)), Formula C (described in § 156.430(c)(4)(i)(C)) may underestimate cost sharing under the standard plan for enrollees who incur large out-of-network claims. In light of these potential biases, one commenter suggested that in-network cost sharing should be calculated separately from out-of-network cost sharing. Other commenters suggested that the QHP issuer's actuary should be allowed greater flexibility in the calculation of an average deductible and an average claims ceiling, based on the actual claims experience of enrollees in the standard plan. One commenter suggested that the issuer's actuary should be required to submit an actuarial memorandum with a justification of any modifications to the effective cost-sharing parameters, demonstrating that the modifications were necessary due to the benefit design and result in a more accurate replication of the standard plan's cost sharing.
We also received a comment asking how mid-year changes in enrollee eligibility for cost-sharing reductions would affect the application of the simplified methodology.
First, we are making several minor edits to clarify the standards originally established. We are reordering some of the text in the definitions of the effective pre-deductible and effective post-deductible coinsurance rates to mirror the structure of the other definitions. Also, in response to the comment asking about mid-year changes in eligibility for cost-sharing reductions, we are clarifying in § 156.430(c)(4) that the effective cost-sharing parameters, or one minus the actuarial value of the standard plan, as appropriate, should be applied to the total allowed costs for EHB for the benefit year under each policy that was assigned to a plan variation for any portion of the benefit year. We note that a similar standard would apply to the standard methodology. This will ensure that QHP issuers are reimbursed for cost-sharing reductions provided to enrollees that are only assigned to a plan variation for a portion of the year. We are also clarifying in paragraphs (c)(4)(ii) and (iii) that the effective cost-sharing parameters should be calculated based on policies assigned to the standard plan without cost-sharing reductions for the entire benefit year. If a particular enrollee cancels his or her standard plan policy mid-year, or is re-assigned to a plan variation, the costs incurred by that enrollee should not be included in the calculation of the effective cost-sharing parameters for the standard plan because partial-year data could reduce the accuracy of the parameters. We also considered requiring QHP issuers to separate costs by month based on the assignment of an enrollee to a particular plan variation or standard plan, or requiring QHP issuers to annualize costs across the benefit year. However, these approaches would have significantly complicated the methodology and potentially reduced its accuracy.
Second, in response to comments that Formula B (described in § 156.430(c)(4)(i)(B)) may overestimate the cost sharing under the standard plan if the enrollees receive services that are not subject to a deductible, we are modifying several of the formulas and effective cost-sharing parameters to more accurately estimate cost sharing for services that are subject to a deductible and services that are not subject to a deductible. Specifically, in paragraph (c)(4)(iii)(A), we are defining the average deductible to be the weighted average deductible for the standard plan (weighted by allowed costs for EHB under the standard plan for the benefit year that are subject to each separate deductible, and excluding services that are not subject to any deductible). Conversely, in paragraph (c)(4)(iii)(B), we are defining effective non-deductible cost sharing to be calculated based only on standard plan policies with total allowed costs for EHB for the benefit year that are above the effective deductible but for which associated cost sharing for EHB is less than the annual limitation on cost sharing, and equal to the average portion of total allowed costs for EHB that are
Building off of these new definitions, we are modifying the definition of effective post-deductible coinsurance rate (initially set forth in paragraph (c)(4)(ii)(C), but renumbered as paragraph (c)(4)(iii)(E)) to be calculated as follows:
These terms are then used in a modified Formula B (described in § 156.430(c)(4)(i)(B)), and detailed below, for plan variation policies with total allowed costs for EHB for the benefit year that are greater than the effective deductible but less than the effective claims ceiling, to calculate the amount that enrollees would have paid under the standard plan without cost-sharing reductions.
In addition, we note that the new definition of effective deductible will likely cause some plan variation policies that previously would have been subject to calculation under Formula B to become subject to Formula A, which we are finalizing as established in the interim final rule. As described in paragraph (c)(4)(i)(A), Formula A applies to plan variation policies with total allowed costs for EHB for the benefit year that are less than or equal to the effective deductible, and calculates the amount that the enrollees would have paid under the standard plan as the total allowed costs for EHB under the policy for the benefit year, multiplied by the effective pre-deductible coinsurance rate.
We are also adding a paragraph to clarify how the simplified methodology should be applied to HMO-like plans (or plans with HMO-like characteristics in certain subgroups) with no costs or few costs that are subject to a deductible. Specifically, in paragraph (c)(4)(vi) we provide that if more than eighty percent of the total allowed costs for EHB for the benefit year under a standard plan for a subgroup that requires a separate set of effective cost-sharing parameters pursuant to paragraph (c)(4)(ii) are not subject to a deductible, then (i) The average deductible, the effective non-deductible cost sharing, and the effective deductible for the subgroup equal zero; (ii) the effective pre-deductible coinsurance rate for the subgroup is equal to the effective post-deductible coinsurance rate for the subgroup, which is determined based on all standard plan policies for the applicable subgroup for which associated cost sharing for EHB is less than the annual limitation on cost sharing, and calculated for the applicable subgroup as the proportion of the total allowed costs for EHB under the standard plan for the benefit year incurred for standard plan enrollees and payable as cost sharing (including cost sharing payable through a deductible); and (iii) the amount that enrollees in the applicable subgroup in plan variation policies with total allowed costs for EHB for the benefit year that are less than the effective claims ceiling would have paid under the standard plan must be calculated using the formula in § 156.430(c)(4)(i)(A). In effect, we are merging Formulas A and B for these plans (or these subgroups), and are removing the distinction between the calculation of cost sharing for costs incurred before the deductible is met versus the calculation after the deductible is met. This modification should simplify calculations for issuers of these plans (or these subgroups), and improve the accuracy of the simplified methodology we are finalizing here for these plans (or these subgroups).
Lastly, in response to comments, we are modifying Formula C (described in § 156.430(c)(4)(i)(C)), which applies to plan variation policies with total allowed costs for EHB for the benefit year that are greater than or equal to the effective claims ceiling, and is used to calculate the amount of cost sharing that those enrollees would have paid under the standard plan. First, we are simplifying the formula established in the interim final rule. Second, because the annual limitation on cost sharing may not apply to benefits provided out-of-network (as allowed under 45 CFR 156.130(c)), we are allowing issuers to elect to use, on a policy-by-policy basis, the standard methodology to calculate the amount of cost sharing that such enrollees would have paid under the standard plan. This modification will allow QHP issuers to capture the value of cost-sharing reductions for enrollees who incur large claim amounts for services from out-of-network providers.
In paragraph (c)(4)(ii)(B), we clarify that if the standard plan has separate cost-sharing parameters for pharmaceutical and medical services, but does not have separate cost-sharing parameters for self-only coverage and other than self-only coverage, the QHP issuer must calculate and apply separate sets of effective cost-sharing parameters based on the medical costs of the enrollees in the standard plan, and the pharmaceutical costs of the enrollees in the standard plan. This standard is not tied to whether or not the pharmaceutical costs are adjudicated separately by a vendor, but depends on whether or not the cost sharing accumulates to separate deductibles and annual limitations on cost sharing.
Lastly, in paragraph (c)(4)(ii)(C), we state that if the standard plan has separate cost-sharing parameters for self-only coverage and other than self-only coverage, and also has separate cost-sharing parameters for pharmaceutical and medical services, the QHP issuer must calculate and apply separate sets of effective cost-sharing parameters based on the medical costs of enrollees in the standard plan with self-only coverage, the pharmaceutical costs of enrollees in the standard plan with self-only coverage, the medical costs of enrollees in the standard plan with other than self-only coverage, and the pharmaceutical costs of enrollees in the standard plan with other than self-only coverage. While these new standards in paragraph (c)(4)(ii) may require additional calculations, enrollee liability can vary significantly between these subgroups, as noted by commenters, and as a result, we believe that separate effective cost-sharing parameters for each subgroup of costs will often lead to more accurate results.
For example, if a QHP is subject to the standards in paragraph (c)(4)(ii)(C), the QHP issuer must create four sets of effective cost-sharing parameters. One of the sets of effective cost-sharing parameters would be calculated based on self-only coverage of medical services (for example, the average deductible would be the medical deductible for self-only coverage). The effective cost-sharing parameters for the subgroup would then be applied to the total allowed medical costs for EHB of enrollees with self-only coverage under a plan variation policy, as described in paragraph (c)(4)(i). To determine the total amount that enrollees in the plan variation policy with self-only coverage would have paid under the standard plan without cost-sharing reductions, the QHP issuer would add the amounts calculated pursuant to paragraph (c)(4)(i) for each subgroup of costs (self-only medical costs and self-only pharmaceutical costs).
In relation to in-network and out-of-network costs, we clarify that although QHP issuers are not required to reduce out-of-network cost sharing to meet the actuarial value requirements for the silver plan variations, as described on page 15481 of the 2014 Payment Notice, if a QHP issuer chooses to reduce out-of-network cost sharing, they will receive reimbursement for those reductions. In addition, QHP issuers must eliminate cost sharing for both in-network and out-of-network covered EHB for the zero cost sharing plan variation, as well as for the limited cost sharing plan variation when the service is furnished by the Indian Health Service, an Indian Tribe, Tribal Organization, or Urban Indian Organization, or through referral under contract health services, as described in 45 CFR 156.420(b). Nevertheless, we are not requiring, nor allowing, QHP issuers to calculate separate effective cost-sharing parameters for in-network and out-of-network costs. We believe that the modifications to Formula C should address much of the bias in the simplified methodology that could be caused by differences in cost-sharing parameters for in-network and out-of-network services. In addition, we hope to limit the number of plans that do not meet the minimum credibility standard, which as described below and in paragraph (c)(4)(v), requires QHP issuers to use an actuarial value methodology to calculate the amount that enrollees would have paid under the standard plan, if a standard plan has enrollment of fewer than 12,000 member months for a particular subgroup. We believe that it is possible that a large number of standard plans would not have 12,000 member months for enrollees with out-of-network claims costs above the applicable effective deductible. Therefore, we will not provide for separate calculations for in-network and out-of-network costs.
In response to the comments suggesting that QHP issuers should be allowed to exclude costs for benefits without cost-sharing reductions, we note that in many cases, these costs would accumulate towards certain cost-sharing parameters, such as a deductible or the annual limitation on cost sharing. Therefore, we are not finalizing any change permitting an issuer to exclude such claims. As discussed above, to address plans with cost-sharing structures where a large proportion of costs are not subject to a deductible, we have provided for a simplified, coinsurance-based calculation in paragraph (c)(4)(vi). Finally, we note
In § 156.430(c)(4)(iii) of the interim final rule, we established reporting standards for QHP issuers that elect to use the simplified methodology. We specified that QHP issuers must submit to HHS, in the manner and timeframe established by HHS: The effective deductible; the effective pre-deductible coinsurance rate; the effective post-deductible coinsurance rate; the effective claims ceiling; and a memorandum developed by a member of the American Academy of Actuaries in accordance with generally accepted actuarial principles and methodologies that describes how the QHP issuer calculated the effective cost-sharing parameters for the standard plan. This information will allow HHS to ensure that QHP issuers are calculating the effective cost-sharing parameters correctly. We sought comments on whether HHS should require any other data submissions or establish any additional standards to oversee these provisions.
We are also clarifying in this final rule the standards for reporting information on the effective cost-sharing parameters. Specifically, we are renumbering the paragraph on reporting as paragraph (c)(4)(iv), and specifying that a QHP issuer using the simplified methodology must submit to HHS, in the manner and timeframe established by HHS, the effective cost-sharing parameters, calculated pursuant to paragraph (c)(4)(iii), for each standard plan offered by the QHP issuer in the individual market through the Exchange for each set of circumstances described in paragraph (c)(4)(ii). Therefore, if a QHP issuer must calculate multiple sets of effective cost-sharing parameters as described in paragraph (c)(4)(ii), the QHP issuer must submit each set of parameters to HHS. A QHP issuer may submit one actuarial memorandum as long as it describes how the QHP issuer calculated each set of effective cost-sharing parameters for each standard plan. We will provide guidance on the manner and timeframe of this submission in the future.
As discussed in the interim final rule, we recognize that because the effective pre- and post-deductible coinsurance rates are calculated based on the average experience of the enrollees in the standard plan, low enrollment in the standard plan could lead to inaccurate effective coinsurance rates. Therefore, we provided additional standards related to the simplified methodology in § 156.430(c)(4)(iv) to address credibility concerns that may result from low enrollment in the standard plan. We established that if a standard plan has an enrollment during the benefit year of fewer than 12,000 member months (that is, the sum of the months that each enrollee is covered by the plan) in any of four subgroups, and the QHP issuer has selected the simplified methodology, then the QHP issuer must calculate the amount that all enrollees in the plan variation (in all subgroups) would have paid under the standard plan by applying the standard plan's actuarial value, as calculated under § 156.135, to the allowed costs for EHB for the enrollees for the benefit year. The credibility standard of 12,000 member months aligns with a similar standard used by the Medicare Part D program; however, we sought comments on the appropriate number of member months to achieve credible use of the simplified methodology. We also sought comments on whether the standard plan's actuarial value applied to the allowed costs for EHB for enrollees for the benefit year would provide an appropriate estimate of the amount of cost sharing that enrollees would have paid under the standard plan without cost-sharing reductions, or whether an alternative approach would be more appropriate. Last, we requested comments on the composition of the subgroups, whether they appropriately divide enrollees based on their utilization patterns, whether any subgroups are required, and whether low enrollment in one subgroup should prompt the QHP issuer to use the actuarial value for enrollees in all subgroups or just the subgroup with low enrollment.
We are also modifying paragraph (c)(4)(v) to align with the standards established in paragraph (c)(4)(ii) and to clarify how the minimum credibility standard should be applied to each subgroup. In addition, we are removing the minimum credibility standard described in the interim final rule in subparagraphs (c)(4)(iv)(A) and (C), related to enrollees with total allowed costs for EHB for the benefit year that are less than or equal to the effective deductible. This change should simplify the credibility analysis, with little
Therefore, in § 156.430(c)(4)(v) of this final rule, we establish that if a QHP issuer's standard plan meets certain criteria, and the QHP issuer has selected the simplified methodology described in this paragraph (c)(4), then the QHP issuer must calculate the amount that enrollees in the plan variation would have paid under the standard plan without cost-sharing reductions as the lesser of the annual limitation on cost sharing for the standard plan or the amount equal to the product of, (x) one minus the standard plan's actuarial value, as calculated under 45 CFR 156.135, and (y) the total allowed costs for EHB for the benefit year under each policy that was assigned to a plan variation for any portion of the benefit year.
In subparagraphs (A) through (D) of § 156.430(c)(4)(v), we detail the minimum credibility criteria that prompt a QHP issuer to use the actuarial value methodology:
(A) The standard plan has separate cost-sharing parameters for self-only coverage and other than self-only coverage, does not have separate cost-sharing parameters for pharmaceutical and medical services, and has an enrollment during the benefit year of fewer than 12,000 member months for coverage with total allowed costs for EHB for the benefit year that are greater than the effective deductible, but for which associated cost sharing for EHB is less than the annual limitation on cost sharing, in either of the following categories: (i) Self-only coverage, or (ii) other than self-only coverage.
(B) The standard plan has separate cost-sharing parameters for pharmaceutical and medical services, does not have separate cost-sharing parameters for self-only coverage and other than self-only coverage, and has an enrollment during the benefit year of fewer than 12,000 member months for coverage with total allowed costs for EHB for the benefit year that are greater than the effective deductible, but for which associated cost sharing for EHB is less than the annual limitation on cost sharing, in either of the following categories: (i) Coverage of medical services, or (ii) coverage of pharmaceutical services.
(C) The standard plan has separate cost-sharing parameters for self-only coverage and other than self-only coverage, has separate cost-sharing parameters for pharmaceutical and medical services, and has an enrollment during the benefit year of fewer than 12,000 member months for coverage with total allowed costs for EHB for the benefit year that are greater than the effective deductible, but for which associated cost sharing for EHB is less than the annual limitation on cost sharing, in any of the following categories: (i) Self-only coverage of medical services, (ii) self-only coverage of pharmaceutical services, (iii) other than self-only coverage of medical services, or (iv) other than self-only coverage of pharmaceutical services.
(D) The standard plan does not have separate cost-sharing parameters for pharmaceutical and medical services, does not have separate cost-sharing parameters for self-only coverage and other than self-only coverage, and has an enrollment during the benefit year of fewer than 12,000 member months with total allowed costs for EHB for the benefit year that are greater than the effective deductible, but for which associated cost sharing for EHB is less than the annual limitation on cost sharing.
In the interim final rule, we noted the possibility that for a very small number of plans with unique cost-sharing structures, the amounts that enrollees would have been paid under the plan might not be fairly estimated using the simplified methodology. We considered a process in which a QHP issuer of such a plan may notify HHS if it believes that this is the case for one or more of its plans. We considered requiring such a notification within ninety days of the beginning of the applicable benefit year, and we considered requiring the QHP issuer to provide information on the unique plan design supporting the QHP issuer's assessment.
Under this approach, if HHS were to agree with the assessment, we considered requiring the QHP issuer to calculate the amount that enrollees would have paid under the standard plan without cost-sharing reductions by applying the standard plan's actuarial value, as calculated pursuant to 45 CFR156.135, to the allowed costs for EHB for the enrollees for the benefit year. If HHS were to disagree with the issuer's assessment, the QHP issuer would calculate such amounts using the effective cost-sharing parameters under the approach described in paragraphs (4)(i) through (4)(iii) of the interim final rule (or paragraph (4)(iv), if applicable).
We sought comments on whether we should adopt such an approach, and on the specifics outlined above. In particular, we sought comments on the types of plans, if any, for which it would be difficult to fairly calculate the amount that enrollees would have paid under the standard plan without cost-sharing reductions using the simplified methodology, and their prevalence. We sought comments on the standard that should apply for determining whether the plan will be exempted from using the simplified methodology, and how HHS should make that determination. Finally, we requested comments on what estimation methodology should be used if the plan is determined to be exempt, and if it is not.
We did not receive any specific comments on this proposal, though as noted above, some commenters suggested that for certain plan designs, the simplified methodology may result in the overestimation or underestimation of enrollee liability, and as a result, the QHP issuer's actuary should be allowed greater flexibility in the calculation of an average deductible and an average claims ceiling, as long as the calculations are justified in the actuarial memorandum.
Because we did not receive any comments supporting this proposal, or any examples of plans for which the simplified methodology would not adequately approximate cost sharing, we are not finalizing this approach.
We are modifying § 156.430(c)(3) to specify that QHP issuers may only choose the simplified methodology for calculating the amounts that would have been paid under the standard plan without cost-sharing reductions for benefit years 2014 through 2016. We also are modifying § 156.430(c)(4) to address unique benefit structures and
We also proposed to add new paragraph (c) to § 156.460, providing that if a QHP issuer discovers that it did not reduce the portion of the premium charged to or for the enrollee for the applicable month(s) by the amount of the advance payment of the premium tax credit as required in § 156.460(a)(1), the QHP issuer would be required to refund to the enrollee any excess premium paid by or for the enrollee and notify the enrollee of the improper application no later than 30 calendar days after the QHP issuer discovers the error. We noted that a QHP issuer may provide the refund to the enrollee by reducing the enrollee's portion of the premium in the following month, as long as the reduction is provided no later than 30 calendar days after the QHP issuer discovers the improper reduction. If the QHP issuer elects to provide the refund by reducing the enrollee's portion of the premium for the following month, and the refund exceeds the enrollee's portion of the premium for the following month, then the QHP issuer would need to refund to the enrollee the excess no later than 30 calendar days after the QHP issuer discovers the improper reduction. We also noted that we were also considering that for each quarter beginning in 2015, a QHP issuer would be required to provide a report to HHS and the Exchange, in a manner and timeframe specified by HHS, detailing the occurrence of instances of improper applications of the requirements of § 156.460.
Additionally, we clarify that this provision would not prevent a QHP issuer from recouping excess funds from the enrollee, if the QHP reduced the enrollee's portion of the premium by more than the advance payment of the premium tax credit.
We are finalizing these provisions as proposed with the following modifications. We are increasing the time period for issuing refunds from 30 to 45 days. We are also permitting the QHP issuer to apply the total excess premium paid by or for the enrollee to the enrollee's portion of the premium each month for the remainder of the period of enrollment or benefit year, except that the QHP issuer must refund the excess premium within 45 days of a request for the refund by or for the enrollee or within 45 days following the end of the period of enrollment or benefit year.
In § 156.480, we proposed general provisions related to the oversight of QHP issuers in relation to cost-sharing reductions and advance payments of the premium tax credit. We proposed to apply certain standards proposed in Part 156, subpart H for QHP issuers participating in FFEs to QHP issuers participating in the individual market on a State Exchange. In paragraph (a), we proposed to extend the standards set forth in proposed § 156.705 concerning maintenance of records to a QHP issuer in the individual market on a State Exchange in relation to cost-sharing reductions and advance payments of the premium tax credit. We also proposed that QHP issuers ensure that any delegated and downstream entities adhere to these requirements. We noted that a QHP issuer and its delegated and downstream entities may satisfy this standard by maintaining the relevant records for a period of 10 years and ensuring that they are accessible if needed in the event of an investigation or audit.
We also proposed that QHP issuers participating in State Exchanges and FFEs be subject to reporting and oversight requirements. In particular, in paragraph (b), we proposed that an issuer that offers a QHP in the individual market through a State Exchange or an FFE report to HHS annually, in a timeframe and manner required by HHS, summary statistics with respect to administration of cost-
We are finalizing these provisions and modifying paragraph (b) to specify that the annual reports must contain summary statistics with respect to the application of cost-sharing reductions and advance payments of the premium tax credit, including any failure to adhere to the standards set forth under § 156.410(a) through (d), § 156.425(a) through (b), and § 156.460(a) through (c) of this Part.
We proposed in § 156.705(a) that issuers offering QHPs in an FFE maintain all documents and records (whether paper, electronic, or other media) and other evidence of accounting procedures and practices, which are critical for HHS to conduct activities necessary to safeguard the financial and programmatic integrity of the FFEs. We proposed that such activities include: (1) Periodic auditing of the QHP issuer's financial records related to the QHP issuer's participation in an FFE, and to evaluate the ability of the QHP issuer to bear the risk of potential financial losses; and (2) compliance reviews and other monitoring of a QHP issuer's compliance with all Exchange standards applicable to issuers offering QHPs in the FFE listed in part 156. We proposed limiting the scope of this requirement to Exchange-specific records as applicable to the FFEs. In § 156.705(b), we proposed that the records described in proposed paragraph (a) of this section include the sources listed in proposed § 155.1210(b)(2), (b)(3), and (b)(5) in order to align the record maintenance standards of the FFEs and State Exchanges to the extent possible. In § 156.705(c), we proposed that issuers offering QHPs in an FFE must maintain the records described in this section, as well as records required by § 155.710 (to determine SHOP eligibility), for 10 years. Proposed § 156.705(d) explained that the records referenced in paragraph (a) must be made available to HHS, the OIG, the Comptroller General, or their designees, upon request. We stated that the proposed standards pertain only to Exchange-specific areas of concern (for example, matters pertaining to advance payments of premium tax credits or cost-sharing reductions) within the FFEs, as HHS would expect the State DOI to oversee the maintenance of records pertaining to other aspects of
We are finalizing the provisions proposed in § 156.705 without modification.
In § 156.715 we proposed that QHP issuers will be subject to compliance review by HHS to ensure ongoing compliance with Exchange standards applicable to issuers offering QHPs in FFEs. We proposed the scope of the compliance reviews and the window of time that such compliance reviews could be conducted.
We are finalizing this provision with the correction of a typographical error in paragraph (c).
In Subpart J, we proposed the administrative hearing process for issuers of QHPs in an FFE against which an enforcement action has been taken. The process is intended to provide the issuer an opportunity to submit evidence to be considered by the administrative law judge (ALJ) in determining whether a basis exists to assess a CMP against or decertify a QHP offered by the respondent, and whether the amount of the assessed CMP is reasonable, if applicable. Our proposed process is modeled after the appeals process for individuals and entities against which a CMP has been imposed in the individual and group health coverage markets. We did not receive any comments on our proposed regulations in this Subpart J.
In § 156.805(d), we proposed that, if HHS proposes to assess a CMP under subpart I, HHS will send written notice of intent to issue a CMP to the QHP issuer concerned. Similarly, in § 156.810(c) and (d), we proposed that, for standard and expedited decertifications, HHS will notify the QHP issuer, enrollees in the QHP, and the State DOI in the State in which the QHP is being decertified of HHS's intent decertify a QHP offered by the issuer. We note that the notice under 45 CFR 156.805(d) and 156.810(c) and (d) is different from, and in addition to, the notice required under 45 CFR 155.1080. In § 156.805 and § 156.810, we set forth the process by which QHP issuers will be notified formally of HHS's intent to issue a CMP or decertify one or more of their QHPs, the grounds for the enforcement action, and other specified information, including information about the process for requesting an appeal. The 30-day clock for requesting an appeal under 45 CFR 156.905(a) starts on the date of issuance of HHS's notice of intent to issue a CMP under § 156.805 or notice of decertification of a QHP under § 156.810(c) or (d). By contrast, 45 CFR 155.1080 requires that notice be sent to the QHP issuer, enrollees in the QHP, and the State DOI when the decertification is final and no longer appealable. Furthermore, 45 CFR 155.1080 does not apply in the case of a CMP. We are finalizing 45 CFR part 156, subpart J as proposed, except for a minor change to § 156.963, described below.
We are finalizing these provisions of 45 CFR part 156, subpart J as proposed, with two exceptions. We are not finalizing § 156.949, and we are making a minor change to correct the reference to the “final order” in § 156.963. We are replacing “the final order described in § 156.945” with “the final order imposing a civil money penalty.”
In § 156.1105, we proposed processes by which HHS would approve and oversee enrollee satisfaction survey vendors that will administer enrollee satisfaction surveys on behalf of QHP issuers. We proposed that enrollee satisfaction survey vendors be approved for one year terms and would be required to submit an annual application demonstrating that they meet all of the application and approval standards. We also proposed listing HHS-approved enrollee satisfaction survey vendors on an HHS Web site. We received several comments and our responses to § 156.1105 are set forth below.
We are finalizing the provisions proposed in § 156.1105 without modification.
We noted in the proposed rule that we anticipate sending each applicable issuer a monthly payment and collections report. This report will show, with respect to certain provisions under Title I of the Affordable Care Act, payments the Federal government owes to the issuer, as well as those the issuer owes the Federal government. For the 2014 benefit year, we anticipate issuing a detailed monthly report, also known as the HIX 820, that will describe the advance payments of the premium tax credit and advance payments of cost-sharing reductions that the Federal government is paying to the issuer for each policy listed on the payment report, any amounts owed by the issuer for FFE user fees, as well as any adjustments from previous payments
We are finalizing § 156.1210, with the following modifications. We are redesignating paragraphs (a) and (b) as paragraphs (a)(1) and (a)(2) and are adding a new paragraph (b) to state that if an issuer reports a discrepancy in a payment and collections report later than 15 calendar days after the date of the report, HHS will work with the issuer to resolve the discrepancy as long the late reporting by the issuer was not due to misconduct on the part of the issuer. And because HHS's payments will technically be made by the U.S. Treasury, we are modifying § 155.1210(a)(1) to clarify that the payments owed by and to the issuer listed on the payment and collections report are payments to and from the Federal government.
Under the Paperwork Reduction Act of 1995, we are required to provide 30-day notice in the
• The need for the information collection and its usefulness in carrying out the proper functions of our agency.
• The accuracy of our estimate of the information collection burden.
• The quality, utility, and clarity of the information to be collected.
• Recommendations to minimize the information collection burden on the affected public, including automated collection techniques.
The following sections of this document contain estimates of burden imposed by the associated information collection requirements (ICRs); however, not all of these estimates are subject to the ICRs under the PRA for the reasons noted. Estimated salaries for the positions cited were mainly taken from the Bureau of Labor Statistics (BLS) Web site (
We are soliciting public comment on each of these issues for the following sections of this document that contain information collection requirements (ICRs):
In § 153.260, we direct a State-operated reinsurance program to: (1) Keep an accurate accounting of reinsurance contributions, payments, and administrative expenses; (2) submit to HHS and make public a summary report on program operations; and (3) engage an independent qualified auditing entity to perform a financial
In § 153.310(c)(4), § 153.310(d)(3)-(4), and § 153.365, we require a State operating risk adjustment to: (1) Retain records for a 10-year period; (2) submit an interim report in its first year of operation; (3) submit to HHS and make public a summary report on program operations for each benefit year; and (4) keep an accurate accounting for each benefit year of all receipts and expenditures related to risk adjustment payments, charges, and administrative expenses. Fewer than 10 States have informed HHS that they will operate risk adjustment for the 2014 benefit year. Since the burden associated with collections from fewer than 10 entities is exempt from the PRA under 5 CFR 1320.3(c)(4) and 44 U.S.C. 3502(3)(A)(i), we are not seeking approval from OMB for the risk adjustment information collection requirements. However, if more than nine States elect to operate risk adjustment in the future, we will seek approval from OMB for these information collections.
In § 153.405(h) and § 153.410(c), we included record retention standards for contributing entities and issuers of reinsurance-eligible plans. In § 153.405(h), we require contributing entities to maintain documents and records, whether paper, electronic, or in other media, sufficient to substantiate the enrollment count submitted pursuant to § 153.405(b) for a period of at least 10 years, and to make those documents and records available upon request to HHS, the OIG, the Comptroller General, or their designees, for purposes of verification of reinsurance contribution amounts. This requirement may be satisfied if the contributing entity archives the documents and records and ensures that they are accessible if needed in the event of an investigation or audit.
We estimate that 26,200 contributing entities will be subject to this requirement, based on the Department of Labor's (DOL) estimated count of self-insured plans and the number of fully insured issuers that we estimate will make reinsurance contributions.
In § 153.410(c), we require issuers of reinsurance-eligible plans to maintain documents and records, whether paper, electronic, or in other media, sufficient to substantiate the requests for reinsurance payments made pursuant to § 153.410(a) for a period of at least 10 years, and must make that evidence available upon request to HHS, the OIG, the Comptroller General, or their designees, (or, in the case of a State operating reinsurance, the State or its designees), for purposes of verification of reinsurance payment requests. We estimate that 1,900 issuers of reinsurance-eligible plans will be subject to this requirement, based on HHS's most recent estimate of the number of fully insured issuers that will submit requests for reinsurance payments. On average, we estimate that it will take each issuer of a reinsurance-eligible plan approximately 10 hours annually to maintain the records. We estimate that it will take an insurance operations analyst 10 hours (at $38.49 per hour) to meet these requirements. On average, the cost estimate for each issuer is approximately $384.90 annually. Therefore, for 1,900 issuers, we estimate an aggregate burden of $731,310.00 and 19,000 hours as a result of this requirement.
The burden estimates for these two recordkeeping requirements are broad estimates that include not only the maintenance of data, but all records and documents that may be necessary to substantiate the enrollment count and requests for reinsurance payments made pursuant to 45 CFR 153.405 and 153.410, respectively. Because the scope of these requirements is substantially narrower than the scope of the recordkeeping requirement applicable to a State operating reinsurance, these estimates are lower than those that were set forth for the State-operated reinsurance programs record maintenance requirement (45 CFR 153.240(c)) in the Premium Stabilization Rule published March 23, 2012 (77 FR 17220), and the associated information collection request approved under OMB Control Number 0938-1155. We note that we will account for the additional burden associated with submitting this information to HHS in a future information collection request that will go through the requisite notice and comment period and subsequent OMB review and approval process.
In subpart M of part 155, we describe the information collection and third-party disclosure standards related to the oversight and financial integrity of State Exchanges.
Section 155.1200(a)(1) through (3) requires the State Exchange to follow GAAP and to monitor and report to HHS all Exchange-related activities. This includes keeping an accurate accounting of all Exchange receipts and expenditures. The burden associated with this reporting requirement is the time and effort needed to develop and submit reports of Exchange-related activities to HHS. The State Exchanges will electronically maintain the information as a result of normal business practices; therefore, the burden does not include the time and effort needed to maintain the Exchange-related activity information. State Exchanges most likely will already have accounting systems in place to store accounting information. The burden associated with this requirement includes a computer programmer taking 8 hours (at $48.61 an hour) to modify the system to maintain and monitor the information required under § 155.1200(a)(1) through (3), an analyst taking 8 hours (at $58.05 an hour) to pull the necessary data under
Section 155.1200(b)(1) requires the State Exchange to submit a financial statement, in accordance with GAAP to HHS. The information under § 155.1200(b) must be submitted at least annually by April 1 to HHS and must also be publicly displayed. The burden associated with this reporting requirement is the time and effort needed to develop and submit the financial statement to HHS. The State Exchanges will electronically submit the information. Therefore, the burden is the time and effort needed to develop and publically display the financial statement. The State Exchanges will electronically maintain the information as a result of normal business practices, therefore the burden does not include the time and effort needed to develop and maintain the financial information. The burden associated with this requirement includes a computer programmer taking 40 hours (at $48.61 an hour) to design the financial statement report, an analyst taking 8 hours (at $58.05 an hour) pulling the necessary data and inputting it into the financial statement report, and a senior manager taking 2 hours (at $77.00 an hour) overseeing the development and transmission of the reported data. We estimate a burden of 50 total hours for each State Exchange at a cost of $2,562.80. Therefore, for the 18 State Exchanges, we estimate an aggregate burden of $45,410.40 and 900 hours as a result of this requirement.
Section 155.1200(b)(2) requires the State Exchange to submit eligibility and enrollment reports to HHS. The State Exchanges will electronically maintain the information as a result of normal business practices, therefore the burden does not include the time and effort required to develop and maintain the source information. The burden associated with this reporting requirement includes the time and effort necessary for a computer programmer taking 40 hours (at $48.61 an hour) to design the report template, an analyst taking 8 hours (at $58.05 an hour) to compile the statistics for the report for submission to HHS, a privacy officer taking 8 hours (at $64.98 an hour) and senior manager taking 2 hours (at $77.00 an hour) overseeing the development and submission of the reported data. The burden also includes the time and effort necessary to post the data on the State Exchange Web site. We estimate an initial year burden of 58 hours at a cost of $3,082.64 to each State Exchange. Therefore, for the 18 State Exchanges, we estimate an aggregate burden of $55,487.52 and 1,044 hours as a result of this requirement.
As discussed in § 155.1200(b)(3), the State Exchange will report performance monitoring data to HHS. The performance monitoring data includes information on financial sustainability, operational efficiency, and consumer satisfaction which will be reported on an annual basis. The State Exchanges will electronically maintain the information as a result of normal business practices developed under Establishment Grants from HHS for this purpose. Therefore the burden does not include the time and effort needed to develop and maintain the performance data. The burden associated with meeting the reporting requirement includes the time and effort necessary for a computer programmer taking 40 hours (at $48.61 an hour) to design the report, for an analyst taking 12 hours (at $58.05 an hour) to pull data into the report and prepare for submission to HHS and for a senior manager taking 2 hours (at $77.00 an hour) to oversee the development and transmission of the reported data. Section 155.1200(b) requires the State Exchange to submit to HHS and to display publicly financial, eligibility and enrollment reports and performance data at least annually. For those measures reported annually, we estimate that in the initial year a burden of 54 hours at a cost of $2,795.00 for each State Exchange. Therefore, for the 18 State Exchanges, we estimate an aggregate burden of $50,031.00 and 972 hours as a result of this requirement. For subsequent years, when the Establishment Grant project period ends we estimate an additional burden of 208 hours necessary for the computer programmer (at $48.61 an hour) to maintain the performance data. For the first year, the burden for maintaining the data was already accounted for in the PRA package for the Exchange Establishment Grants (OMB Control Number 0938-1119); therefore, we are only including subsequent years in the ICR. We estimate that the total burden from year 1 will decrease to $25,016.00 assuming a decreased effort and an additional burden of $18,1996.00 for maintaining the data, yielding a total burden of $44,012.00 for subsequent years.
Section 155.1200(b)(4) requires the State Exchange to make public a summary of the results of the external financial audit. The burden associated with this requirement is the time and effort for a computer programmer taking 1 hour (at $48.61 an hour) to design the summary and for an analyst to take 1 hour (at $58.05 an hour) to pull data into the summary and prepare for public display. For this requirement we estimate in the initial year a burden of 2 hours for the State Exchanges at a cost of $107.00 each and a total burden of $1926.00. Therefore, for the 18 State Exchanges, we estimate an aggregate burden of $1926.00 and 36 hours as a result of this requirement.
Section 155.1200(c)(1) through (3) directs the State Exchange to engage an independent audit/review organization to perform an external financial and programmatic audit of the State Exchange. The State Exchange must provide the results of the audit and identify any material weakness or significant deficiency and any intended corrective action. The State Exchange must also make public a summary of the audit results. The burden associated with meeting this third party disclosure requirement includes the burden for an analyst level employee taking 3 hours (at $48.61 an hour) to pull data into a report, the time and effort necessary for a health policy analyst taking 2 hours (at $58.05 an hour) to prepare the report of the audit results, and the time for senior management taking 1 hour (at $77.00 an hour) to review and submit to HHS. We estimate a burden of 6 hours at a cost of $338.93 for each State Exchange. Therefore, for the 18 State Exchanges, we estimate an aggregate burden of $6,100.74 and 108 hours as a result of this requirement.
As stated in § 155.1210(a), the State Exchange and its contractors, subcontractors, and agents must maintain for 10 years, books, records, documents, and other evidence of accounting procedures and practices. Section 155.1210(b) specifies that the records include information concerning management and operation of the State Exchange's financial and other record keeping systems. The records must also include financial statements, including cash flow statements, and accounts receivable and matters pertaining to the costs of operation. Additionally, the records must contain any financial report filed with other Federal programs or State authorities. Finally, the records must contain data and records relating to the State Exchange's eligibility verifications and determinations, enrollment transactions, appeals, plan variation certifications, QHP contracting data, consumer outreach, and Navigator grant oversight information. State
The QHP issuer must notify HHS of the change in a manner to be specified by HHS and provide the legal name and tax identification number of the new owner of the QHP and the effective date of the change of ownership. The information must be submitted at least 30 days prior to the effective date of the change of ownership. We estimate fewer than 10 QHP issuers will report changes of ownership. While this reporting requirement is subject to the PRA, we believe the associated burden is exempt under 5 CFR 1320.3(c)(4) and 44 U.S.C. 3502(3)(A)(i), since fewer than 10 entities would be affected. Therefore, we are not seeking approval from OMB for these information collection requirements.
Several of the provisions established in the interim final rule and finalized in this final rule require the collection of information.
First, under paragraph (c)(3)(i) as established in the interim final rule, and finalized in this rule, a QHP issuer must notify HHS prior to the start of each benefit year whether or not it selects the simplified methodology for the benefit year. Pursuant to the Paperwork Reduction Act of 1995, we detailed this information collection in a notice requesting comment in the
In § 156.430(c)(4) of the interim final rule, we established a simplified methodology for calculating the value of the amount that the enrollees would have paid under the standard plan without cost-sharing reductions. To estimate the incremental effect of the simplified methodology, we compared the burden of the standard methodology to the simplified methodology for those issuers that we assumed would select the simplified methodology. As discussed in the Collection of Information section in the 2014 Payment Notice, we estimated that 1,200 issuers will participate in an Exchange nationally and will incur total costs of approximately $138 million using the standard methodology. In contrast, in the interim final rule, we estimated that each issuer using the simplified methodology would incur labor costs of 40 hours of work by an actuary (at a wage rate of $56.89) and 20 hours of work by an insurance manager (at a wage rate of $67.44) to develop the effective cost-sharing parameters and actuarial memorandum, and calculate the amount of cost-sharing reductions provided, resulting in a cost of approximately $3,624 per issuer.
Because we have modified the simplified methodology in this final rule, we are updating this estimate to require 42 hours of work by an actuary and 22 hours of work by an insurance manager, resulting in a cost of approximately $3,873 per issuer. Although we cannot predict the precise number of issuers that will select either the standard or simplified methodology, we estimate that approximately half of QHP issuers (600 issuers) will implement the simplified methodology. Therefore, we estimate that the provisions of this rule will result in an incremental savings of approximately $57,676,164 ($60 million that would have been incurred by these issuers under the standard methodology, minus 600 multiplied by $3,873) by reducing the overall administrative costs that issuers incur.
The information collections associated with these provisions are subject to the Paperwork Reduction Act; however, the information collection process and instruments are currently under development. We will seek OMB approval and solicit public comments upon their completion.
Section 156.460 requires a QHP issuer to notify the enrollee within 45 calendar days of the QHP issuer's discovery of the error, when the QHP issuer improperly reduces the premium by the amount of the advance payment of the premium tax. A parallel provision is established under § 155.340 when the Exchange is facilitating the collection of premiums. Additionally, in § 156.410(c) and (d) a QHP issuer must notify the enrollee within 45 calendar days of the QHP issuer's discovery of the error of a misapplication of the cost-sharing reduction or the improper assignment to a plan variation (or standard plan without cost-sharing reductions) and subsequent reassignment. We believe that these notifications will be effectuated as part of standard billing practices and therefore will not create an additional burden on the Exchange or QHP issuers. Therefore, we do not estimate a burden for this notification.
In § 156.480(a), we extend the standards set forth in proposed § 156.705 concerning maintenance of records to a QHP issuer in the individual market on State Exchange with respect to cost-sharing reductions and advance payments of the premium tax credit. We believe that the burden of maintaining records related to cost-sharing reductions and advance payments of the premium tax credit for QHP issuers in an FFE is already accounted for in the burden for finalized § 156.705, described elsewhere in the Collection of Information section of this final rule. In § 156.480(b), we establish that, for each benefit year, an issuer that offers a QHP in the individual market through a State Exchange or an FFE report to HHS annually, in a timeframe and manner required by HHS, summary statistics with respect to cost-sharing reductions and advance payments of the premium tax credit. In the proposed rule we stated that we believed that QHP issuers would already have the information and data systems in place necessary to generate a summary report, and that there would only be a small additional burden as a result of this submission requirement. We estimated that it would take an insurance operations analyst 16 hours (at $38.49 an hour) annually and one senior manager 2 hours (at $77.00 an hour) to gather summary information and prepare a report for submission to HHS. Therefore, we estimated an additional burden of 21,600 hours and total costs of approximately $923,808 for 1,200 QHP issuers ($769.84, on average, for each QHP issuer) as a result of this requirement. However, in this final rule, we are adding a requirement that these summary reports include information on misapplication of cost-sharing reductions and advance payments of the
The burden estimates for the collections of information in Part 156, Subpart H, of the regulation reflect the assumption that the FFEs will include 475 QHP issuers. We update the number of issuers in the FFEs from the estimated number in the proposed rule to reflect more current information on the number of issuers expected to participate in the FFEs. The labor categories and salary estimates used to calculate the cost burden of these collections on issuers are derived from the Bureau of Labor Statistics' (BLS) May 2012 Occupational Employment Statistics data for selected occupations. These burden estimates generally reflect burden for the first year.
Section 156.705 provides that issuers offering QHPs in an FFE must maintain all documents and records (whether paper, electronic or other media), and other evidence of accounting procedures and practices necessary for HHS to conduct activities necessary to safeguard the financial and programmatic integrity of the FFEs. Such activities include: (1) periodic auditing of the QHP issuer's financial records, including data related to the QHP issuer's ability to bear the risk of potential financial losses; and (2) compliance reviews and other monitoring of a QHP issuer's compliance with all Exchange standards applicable to issuers offering QHPs in the FFEs listed in part 156. These standards are limited to Exchange-specific records as applicable to the FFEs, and are not enforced by States as primary regulators. This standard mirrors the maintenance of records standard applicable to State Exchanges and set forth in § 155.1210. The burden includes utilizing existing technology and systems to process and maintain this information. This reflects 60 hours of work by an actuary (at $56.89 an hour), 15 hours by a network administrator (at $46.86 an hour), 15 hours by a compliance officer (at $53.75 an hour), and 10 hours for a senior manager to review (at $77.00 an hour). We estimate that it will take 100 hours total at a cost of $5,693.00 for a QHP issuer to maintain these records for an aggregate burden of 47,500 hours and $2,704,175 for all 475 QHP issuers.
Section 156.705(d) provides that QHP issuers must make all records described in paragraph (a) of this section available to HHS, the OIG, the Comptroller General, or their designees, upon request. In estimating the annual hour and cost burden on QHP issuers of making these records available to such authorities upon request, we assumed that such requests would normally be made in connection with a formal audit or compliance review or a similar process. Our burden estimates for this section address the hour and cost burden of making records available to HHS, the OIG, the Comptroller General, or their designees, for audit. Our estimates reflect our assumptions that about 47 QHP issuers would be subject to a formal audit in a given year and that the burden on issuers of making the records available would include the time, effort, and associated cost of compiling the information, reviewing it for completeness, submitting it to the auditor(s), and participating in telephone or in-person interviews. We anticipate using a risk-based approach to selection of the majority of QHP issuers for compliance review so that burdens to the issuer community would generally be linked to the QHP issuers' risk. This reflects 75 hours of work by an actuary (at $56.89 an hour), 10 hours by a compliance officer (at $53.75 an hour), and 5 hours for a senior manager to review (at $77.00 an hour).We estimate it will take 90 hours at a cost of $5,189.25 for an issuer to make its records available for an audit for a total of 4,230 hours and $243,894.75 across all QHP issuers subject to this requirement, which we estimate at an upper end as 100 issuers.
Section 156.715 establishes the general standard that QHP issuers are subject to compliance reviews. Our burden estimates for § 156.715 address the estimated annual hour and cost burden on QHP issuers of complying with the records disclosure requirements associated with compliance reviews conducted by an FFE.
Section 156.715 provides standards for compliance reviews in the FFEs, stating that QHP issuers offering QHPs in the FFEs may be subject to compliance reviews. This section also describes the categories of records and information issuers must make available to an FFE in conducting such reviews.
Compliance reviews evaluate a QHP issuer's compliance with the Affordable Care Act and applicable regulations. Compliance reviews will target high-risk QHP issuers and not every issuer will be reviewed each year. The results of compliance reviews will also provide insight into trends across the compliance statuses of QHP issuers, enabling HHS to prioritize areas of oversight and technical assistance.
We assume that HHS will conduct desk reviews of 31 QHP issuers each year. For each QHP issuer desk review we estimate an average of 40 hours of administrative work to assemble the requested information by a health policy analyst (at $58.05 an hour), 19.5 hours to review the information for completeness and an additional 30 minutes for a compliance officer to submit the information to HHS (at $53.75 an hour). There will also be an additional 10 hours to spend on phone interviews conducted by the compliance reviewer and 2 hours to spend speaking through processes with the compliance reviewer (at $53.75 an hour). We estimate it will take 72 hours at a cost of $4,042.00 for an issuer to make information available to HHS for a desk review for a total of 2,232 hours and $125,302.00 across all issuers that may be subject to this information collection requirement.
We assume that HHS will conduct onsite reviews of 16 QHP issuers each year. For each onsite review we estimate it will take an average of 40 hours for a health policy analyst (at $58.05 an hour) to assemble the requested information, and 19.5 hours for a compliance officer (at $53.75 an hour) to review the information for completeness and 30 minutes to submit the information to HHS in preparation for an onsite review. An onsite review requires an additional 2 hours to schedule the onsite activities with the compliance officer (at $53.75 an hour), 4 hours for introductory meeting, 8 hours to tour reviewers onsite, 10 hours of interview time, 2 hours to walk through processes with the reviewer, and 4 hours for concluding meetings. This is a total of approximately 60 hours of preparation time and an additional 30 hours for onsite time for each QHP. We estimate it will take 90 hours at a cost of $5,009.50 for an issuer to make information available to HHS for an onsite review. We estimate that the burden for all respondents that may be subject to this information collection will be 1,440 hours at a cost of $80,152.00
In cases in which HHS could potentially require clarification around submitted information, HHS may need to contact QHP issuers within 30 days of information submission. This would be the case for approximately 20 issuers. We estimate it will take an issuer 2 hours (at $53.75 an hour) to respond to questions for a total of 40 hours and $1,075.00.
Subpart J of Part 156 sets forth the administrative process for issuers subject to a CMP or decertification of a QHP offered by the issuer to appeal the enforcement action. In this process, an ALJ decides whether there is a basis for HHS to assess a CMP against the issuer and whether the amount of an assessed penalty is reasonable, or whether there is a basis for decertifying a QHP offered by the issuer, as applicable. Section 156.905 (intended to parallel 45 CFR 150.405) provides that a party has a right to a hearing before an ALJ if it files a valid request for a hearing within 30 days after the date of issuance of HHS's notice of proposed assessment or decertification. An issuer's request for a hearing must include the information listed in § 156.907. Under § 156.907, the request for a hearing must identify any factual or legal bases for the assessment or decertification with which the issuer disagrees. It must also describe with reasonable specificity the basis for the disagreement, including any affirmative facts or legal arguments on which the respondent is relying. The request must also identify the relevant notice of assessment or decertification by date and attach a copy of the notice.
The burden associated with this request includes the time and effort needed by the issuer to create the written request and submit it to the appropriate entity. The associated costs are labor costs for gathering the necessary background information described under § 156.907 and then preparing and submitting the written statement.
We base our burden estimate on the assumptions that one issuer will be subject to a CMP and that one issuer will have a QHP that it offers in an FFE decertified. We assume that the issuer in each case will choose to exercise its right to a hearing and will submit a valid request for hearing. The hours involved in preparing this request may vary; for the purpose of this burden estimate we estimate an average of 24 hours will be needed: 10 hours for the compliance officer to gather and assemble the necessary background materials described under § 156.907, and prepare the written request (at $53.75 an hour), 12 hours for an attorney (at $90.14 an hour) to review the background materials and written request and provide recommendations to the senior manager, and 2 hours for the senior manager (at $77.00 an hour) to discuss and act upon the attorney's recommendations and submit the written request. We estimate that it will take 24 hours at a cost of $1,773.18 for an issuer to prepare and submit a request for a hearing for a total of 48 hours and $3546.36 for each issuer subject to an enforcement action under this scenario. This estimate includes any statement of good cause under § 156.805(e)(3) or request for extension under § 156.905(b), if applicable. Because we only estimate that one issuer per year would appeal a CMP and one issuer will have its QHP offered in an FFE decertified, we do not include this burden estimate in our overall calculation of burden for this rule.
In subpart L of part 156, we describe the information collection and disclosure requirements that pertain to the approval of enrollee satisfaction survey vendors. The burden estimate associated with these disclosure requirements includes the time and effort required for enrollee satisfaction survey vendors to develop, compile, and submit the application information and any documentation necessary to support oversight in the form and manner required by HHS. HHS is developing a model enrollee satisfaction survey vendor application that will include data elements necessary for HHS review and approval. In the near future, HHS will publish the model application and will solicit public comment. At that time, and per the requirements outlined in the PRA, we will estimate the burden on survey vendors for complying with this provision of the regulation. We solicit comment on the burden for the application and review process for these entities.
In § 156.1210, we establish that, within 15 calendar days of the date of a HIX 820 payment and collections report from HHS, the issuer must, in a format specified by HHS, either confirm to HHS that the HIX 820 payment and collections report accurately lists, for the timeframe specified in the report, applicable payments owed by the Federal government and the issuer; or describe to HHS any inaccuracy it identifies in the payment and collections report. We believe that issuers will generally be able to perform this confirmation automatically, and that there will only be a small additional burden as a result of this requirement. We estimate that it will take an insurance operations analyst 1 hour (at $38.49 an hour) monthly to make the comparison and note any discrepancies to HHS (approximately $461.88 for each issuer annually). Based on our most recent estimates, we believe that 2,400 issuers will be affected by this requirement, resulting in aggregate burden of approximately $1,108,512.
If you comment on these information collection and recordkeeping requirements, please do either of the following:
1. Submit your comments electronically as specified in the
2. Submit your comments to the Office of Information and Regulatory Affairs, Office of Management and Budget,
In accordance with the provisions of Executive Order 12866, this rule was reviewed by the OMB.
This final rule sets financial integrity and oversight standards with respect to Exchanges; QHP issuers in an FFE; and States in regards to the operation of the risk adjustment and reinsurance programs. It also provides additional standards for special enrollment periods; survey vendors that may conduct enrollee satisfaction surveys on behalf of QHP issuers in Exchanges; and issuer participation in an FFE. In addition, this final rule amends and adopts as final interim provisions related to risk corridors and cost-sharing reduction reconciliation. Finally, it provides additional standards for guaranteed availability and renewability and makes certain amendments to the definitions and standards related to the market reform rules.
HHS has crafted this final rule to implement the protections intended by Congress in an economically efficient manner. We have examined the effects of this final rule as required by Executive Order 12866 (58 FR 51735, September 1993, Regulatory Planning and Review), the Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354), section 1102(b) of the Social
Executive Order 12866 (58 FR 51735) directs agencies to assess all 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 (76 FR 3821, January 21, 2011) is supplemental to and reaffirms the principles, structures, and definitions governing regulatory review as established in Executive Order 12866.
Section 3(f) of Executive Order 12866 defines a “significant regulatory action” as an action that is likely to result in a final rule—(1) Having an annual effect on the economy of $100 million or more in any one year, or adversely and materially affecting a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local or tribal governments or communities (also referred to as “economically significant”); (2) creating a serious inconsistency or otherwise interfering with an action taken or planned by another agency; (3) materially altering the budgetary impacts of entitlement grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) raising novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the Executive Order.
A regulatory impact analysis (RIA) must be prepared for major rules with economically significant effects ($100 million or more in any 1 year), and a “significant” regulatory action is subject to review by the OMB. OMB has designated this final rule as a “significant regulatory action.” Even though it is not certain whether it will have economic impacts of $100 million or more in any one year, HHS has provided an assessment of the potential costs and benefits associated with this final regulation.
Starting in 2014, qualified individuals and qualified employers will be able to use coverage provided by QHPs—private health insurance that has been certified as meeting certain standards—through Exchanges. The premium stabilization programs—the reinsurance, risk corridors and risk adjustment programs—will be in place to ensure premium stability for health insurance issuers as enrollment increases and issuers enroll high-risk individuals. This final rule establishes general oversight requirements for State-operated reinsurance and risk adjustment programs; establishes oversight of issuers inside and outside of the Exchange when HHS operates risk adjustment or reinsurance on behalf of a State; and establishes oversight and monitoring of State Exchanges, FFEs, SHOPs (both State Exchanges and FFEs) and issuers of QHPs, specifically with respect to financial integrity, and maintenance of records. This final rule also restricts the use of funds for administrative expenses generated for State Exchanges and State-operated reinsurance programs; specifies procedures for oversight of advance payments of the premium tax credit and cost-sharing reductions; provides procedures to ensure the accuracy of data collection, calculations, and submissions; establishes requirements for enrollee satisfaction survey vendors; establishes standards related to risk corridors and cost-sharing reduction reconciliation; and provides additional standards for special enrollment periods.
In accordance with OMB Circular A-4, Table IV.1 below depicts an accounting statement summarizing HHS's assessment of the benefits and costs associated with this regulatory action. The period covered by the RIA is 2014-2017.
HHS anticipates that the provisions of this final rule will ensure smooth operation of Exchanges, integrity of the reinsurance, risk adjustment and risk corridors programs, safeguard the use of Federal funds, prevent fraud and abuse, and increase access to healthcare coverage. Affected entities such as States and QHP issuers will incur costs to maintain records, submit reports to HHS and Exchanges, and provide records for compliance reviews. In addition, QHP issuers that adopt the simplified methodology for calculating cost sharing reductions will incur lower administrative costs during a transitional period. In accordance with Executive Order 12866, HHS believes that the benefits of this regulatory action justify the costs.
Starting in 2014, individuals and small businesses will be able to use health insurance coverage purchased through Exchanges. The Congressional Budget Office estimated that the number of people enrolled in coverage through Exchanges will increase from 7 million in 2014 to 24 million in 2017.
The final rule specifies the standards and processes for the oversight and accountability of entities responsible for operations of the Exchanges and reinsurance and risk adjustment programs. Affected entities include States that establish and operate Exchanges and administer reinsurance and risk adjustment programs; FFEs; issuers of QHPs; health insurance issuers offering coverage both through and outside of an Exchange when HHS operates risk adjustment or reinsurance on behalf of the State; and contractors of these organizations.
This final rule implements oversight, record maintenance, and enforcement provisions that will ensure integrity of the reinsurance and risk adjustment programs, State Exchanges and FFE functions, and prevent fraud and abuse.
This final rule includes provisions that will create a system of oversight, financial integrity and program integrity in the Exchanges and the premium stabilization programs. The oversight requirements for the reinsurance and risk-adjustment programs will ensure that these programs are effective and efficient, and use program funds appropriately. The provisions of this final rule will also ensure that Federal funds are used appropriately by State Exchanges. By monitoring financial reports and overseeing State Exchange activities, HHS will safeguard the use of Federal funds provided as cost-sharing reductions and advance payments of the premium tax credit, and provide value for taxpayers' dollars.
The provisions of this final rule also ensure that enrollees are promptly refunded any excess premium paid or any excess cost sharing they should not have paid. Individuals harmed by misconduct on the part of non-Exchange entities will also be eligible for a special enrollment period. A QHP is also required to promptly reassign an enrollee improperly assigned to a plan variation (or standard plan without cost-sharing reductions), minimizing consumer harm.
The annual application requirement for enrollee satisfaction survey vendors allows HHS to ensure that these entities participate in relevant training and post-training certification, follow protocols related to quality assurance and the use of HHS data, and adhere to privacy and security standards when handling data. This will help to ensure that ultimately the enrollee satisfaction survey data are reliable and valid and that the information is sufficiently protected.
Affected entities will incur costs to comply with the provisions of this final rule. Costs related to information collection requirements subject to PRA are discussed in detail in section III and include administrative costs incurred by States and issuers related to record maintenance and reporting requirements; and oversight and financial integrity standards. In this section we discuss other costs related to the provisions in this final rule.
States operating reinsurance programs are required to keep an accurate accounting for each benefit year, of all reinsurance funds received from HHS for reinsurance payments and for administrative expenses, as well as all claims for reinsurance payments from issuers of reinsurance-eligible plans, all payments made to those issuers, and all administrative expenses incurred. State-operated reinsurance programs will already have a system in place to track reinsurance funds received from HHS, claims from and payments to issuers, and expenses incurred to operate the reinsurance program. The cost for States operating reinsurance programs to maintain any records associated with the reinsurance program was previously estimated in the RIA of the 2014 Payment Notice as being part of State administrative costs associated with operating the reinsurance program and are not included in this RIA.
State-operated reinsurance programs will submit to HHS annually and make public a summary report of their program operations, which will include a summary of the accounting kept pursuant to § 153.260(a). We assume that the data already collected and used to report to issuers and HHS will be the same used to prepare this annual report. Therefore, the cost associated with this requirement is the incremental time and cost to prepare an annual report to HHS and the public on program operations. We estimate it will take an insurance management analyst 16 hours (at $51 per hour) and a senior manager 2 hours (at $77 per hour) to prepare the report. Therefore, we estimate it will cost each State that operates reinsurance approximately $970 to submit this report to HHS. Because two States will operate reinsurance programs in the 2014 benefit year, we estimate that an aggregate cost of $1,940 as a result of this requirement in the first year. We note that HHS will provide a portion of the reinsurance contributions it collects to States operating reinsurance programs to support State administration of reinsurance payments, which will likely cover the costs associated with this requirement.
A State operating a risk adjustment program is required to maintain documents and records relating to the risk adjustment program, whether paper, electronic or in other media, for each benefit year for at least 10 years, and make them available upon request from HHS, the OIG, the Comptroller General, or their designees, to any such entity. The documents and records must be sufficient to enable the evaluation of a State-operated risk adjustment program's compliance with Federal standards. States are also directed to ensure that their contractors, subcontractors, and agents maintain and make those documents and records available upon request from HHS, the OIG, the Comptroller General, or their
A State operating a risk adjustment program is required to submit by December 31st of the first benefit year of operation an interim summary report on the first 10 months of risk adjustment activities, in order to obtain re-certification for the third benefit year. The cost of complying with this provision is the time and effort to write the interim report and submit it to HHS. We estimate it will take an insurance management analyst 16 hours (at $51 per hour) and a senior manager 2 hours (at $77 per hour) to prepare the interim summary report. Therefore, we estimate that it will cost each State operating risk adjustment $970 to submit this report to HHS (an aggregate cost of $970 in the 2014 benefit year). A State operating a risk adjustment program will submit and make public, a summary report of its risk adjustment program operations for each benefit year after the first benefit year for which the State operates the program. This summary report will include the results of a programmatic and financial audit for each benefit year conducted by an independent qualified auditing entity. We believe the cost of this annual report will be the same as the cost of producing the interim first-year report described above, except for the cost of independent external audits required in subsequent years. The costs related to the annual external audit are estimated later in this RIA. These estimates also include the administrative costs related to the requirement for State-operated risk adjustment programs to keep accurate accounting for each benefit year of all receipts and expenditures related to risk adjustment payments, charges, and administration of the program.
States face a variety of costs due to the monitoring requirements in this final rule. Conducting oversight of the Exchanges, State-operated risk adjustment and reinsurance programs, administration of the advance payments of the premium tax credit or cost-sharing reductions, and other activities require independent external audits, investigations, rectification of errors, and the development of summary reports which will be submitted to HHS. The estimated total costs for independent external audits for State-operated reinsurance, risk adjustment and Exchange programs are presented in Table IV.2. It is expected that 18 States will establish State Exchanges in 2014 and, without further information; we assume that number will stay the same during the period covered by the RIA. We also assume that each State will conduct a financial audit and a programmatic audit annually, which will encompass the reinsurance and risk adjustment programs if the State operates these programs. Financial audit costs are estimated based on prices among the big four audit firms for governmental entities of similar size to those of the anticipated State Exchanges for a financial statement audit and Yellowbook Report (report on internal controls) that reflects different levels of cost for small, medium, and large entities, for entities with low, medium, and high risk. Programmatic audit estimates reflect the experience of Federal entitlement programs similar to Medicaid, audited under an A-133 program compliance supplement, and vary only by the size of the program (small, medium and large). For example, a small Exchange judged to have low risk is estimated to have a combined financial and programmatic audit cost of $90,000; a large Exchange, in a State that also administers a reinsurance program (which implies a more complex, high risk operation) is estimated to have combined financial and programmatic audit costs of $360,000. Audit prices are based on 2012 pricing and reflect an annual increase of 3 percent each year, based on recent industry experience. It is expected that there will be four small State Exchanges, 12 medium size State Exchanges and two large State Exchanges. The lower bound of the range in Table IV.2 below assumes that all State Exchanges have low risk and the upper bound is calculated assuming that all State Exchanges have high risk.
A State operating a SHOP-only Exchange will be able to establish and operate a risk adjustment program for both the small group and individual markets starting in 2015, which will allow it to minimize costs by achieving economies of scale and reduce compliance costs for issuers. The approach to allowable costs will be operationally simpler for issuers to implement and thus minimize related costs.
The final rule permits QHP issuers to use the simplified methodology to calculate cost-sharing reductions during a transitional period and postpone a more costly IT implementation that would be required for the standard methodology. The costs related to the administration of cost-sharing reductions using the standard methodology are accounted for in the 2014 Payment Notice and are not included here. However, as explained in section III, the provisions of this final rule allowing the use of a simplified methodology during the transitional period are likely to result in a reduction in costs estimated to be approximately $57.7 million.
The final rule requires the enrollee satisfaction survey vendors engaged by issuers to meet HHS standards. Survey vendors will apply for approval annually in order to administer enrollee satisfaction surveys to QHP enrollees on behalf of a QHP issuer. Survey vendors will incur costs to submit the annual applications to HHS and to meet the requirements necessary to meet approval.
Under the Executive Order, HHS is required to consider alternatives to
Under this alternative, HHS would have required a single standard for Exchanges across the nation regardless of whether the Exchange was established and operated by a State or was Federally-facilitated. The final rule defers to State discretion in oversight of QHPs. This element of State flexibility would have been precluded if greater uniformity in operations and standards were to be imposed. Greater standardization would have had an uncertain impact on Federal oversight activities but would have likely imposed greater costs of compliance on State operations and issuers of QHPs in those States.
Under this alternative, HHS would have placed more responsibility on States and State Exchanges to interpret and meet statutory requirements. This approach could have created a number of problems. If every State developed its own monitoring standards, oversight of different Exchanges could be quite uneven, as States across the country have varying levels of fiscal resources with which to monitor activities. States currently have certain levels of responsibility under the Affordable Care Act to oversee standards for Exchanges, QHPs, and other programs. State Exchanges also have latitude in the number, type, and standardization of plans they certify and accept into the Exchange as QHPs.
There are a number of provisions in the Affordable Care Act that devolve responsibilities from the Federal government to States. Increased devolution could have decreased the need of Federal oversight, while granting States increased flexibility to regulate Exchanges within their borders. There would also have been a decrease in oversight-related activities for the Federal government such as HHS investigations or audits. On the other hand, States would have likely faced an increase in their own oversight activities and related costs.
HHS considered not promulgating the simplified methodology during a transition period. However, doing so could have imposed costly IT system build requirements on many issuers at a time when QHP issuers are required to make many significant IT and operational changes.
HHS believes that the options adopted in this final rule strike the best balance of ensuring efficient operation and integrity of Exchanges and the premium stabilization programs while providing flexibility to the States and minimizing the burden on States.
The Regulatory Flexibility Act (RFA) requires agencies that issue a rule to analyze options for regulatory relief of small businesses if a rule has a significant impact on a substantial number of small entities. The RFA generally defines a “small entity” as—(1) A proprietary firm meeting the size standards of the Small Business Administration (SBA), (2) a nonprofit organization that is not dominant in its field, or (3) a small government jurisdiction with a population of less than 50,000 (States and individuals are not included in the definition of “small entity”). HHS uses as its measure of significant economic impact on a substantial number of small entities a change in revenues of more than 3 percent to 5 percent. HHS anticipates that this final rule will not have a significant economic impact on a substantial number of small entities.
As discussed in the Web Portal interim final rule with comment period published on May 5, 2010 (75 FR 24481), HHS examined the health insurance industry in depth in the RIA we prepared for the proposed rule on the establishment of the Medicare Advantage program (69 FR 46866, August 3, 2004). In that analysis it was determined that there were few, if any, insurance firms underwriting comprehensive health insurance policies (in contrast, for example, to travel insurance policies or dental discount policies) that fell below the size thresholds for “small” business established by the SBA (currently $35.5 million in annual receipts for health insurance issuers).
Section 202 of the Unfunded Mandates Reform Act (UMRA) of 1995 requires that agencies assess anticipated costs and benefits before issuing any final rule that includes a Federal mandate that could result in expenditure in any one year by State, local or tribal governments, in the aggregate, or by the private sector, of $100 million in 1995 dollars, updated annually for inflation. In 2013, that threshold level is approximately $141 million.
UMRA does not address the total cost of a final rule. Rather, it focuses on certain categories of cost, mainly those “Federal mandate” costs resulting from—(1) imposing enforceable duties on State, local, or tribal governments, or on the private sector; or (2) increasing the stringency of conditions in, or decreasing the funding of, State, local, or tribal governments under entitlement programs.
The final rule directs States to undertake oversight activities for State Exchanges, State-operated reinsurance and risk adjustment programs. The costs related to oversight activities, recordkeeping, reporting and audits are estimated to be approximately $2.8 million in 2014. There are no mandates on local or tribal governments. The private sector, for example, QHP issuers and agents and brokers, will incur costs to comply with the record maintenance and reporting requirements set forth in this final rule. The related costs are estimated to be approximately $14.2 million in 2014. However, QHP issuers are also expected to experience a cost savings of approximately $57.7 million by adopting the simplified methodology to calculate cost sharing reductions during a transitional period and postponing costly IT implementation.
Executive Order 13132 establishes certain requirements that an agency must meet when it promulgates a final rule that imposes substantial direct requirement costs on State and local governments, preempts State law, or otherwise has Federalism implications.
States are the primary regulators of health insurance coverage. States will continue to apply State laws regarding health insurance coverage. However, if any State law or requirement prevents the application of a Federal standard, then that particular State law or requirement would be preempted. State requirements that are more stringent than the Federal requirements would be not be preempted by this final rule. Accordingly, States have significant latitude to impose requirements with respect to health insurance coverage that are more restrictive than the Federal law.
The State Exchange oversight program builds on State oversight efforts, where possible, by coordinating with State authorities to address compliance issues and concerns. Because QHPs are one of several commercial market insurance products operating in State markets, HHS will not seek to inappropriately duplicate or interfere with the traditional regulatory roles played by the State DOIs. HHS will generally confine its QHP oversight to Exchange-specific requirements and attributes. HHS will also seek to work collaboratively with State DOIs on topics of mutual concern, in the interest of efficiently deploying oversight resources and avoiding needlessly duplicative regulatory roles. QHP issuers are expected to comply with standards established by State law and regulation for cases forwarded to an issuer by a State in which it offers QHPs.
The requirements specified in this final rule will impose direct costs on State and local governments and HHS has attempted to minimize those costs. State Exchanges and State-operated reinsurance and risk adjustment programs are required to undertake oversight, record maintenance and reporting activities.
In compliance with the requirement of Executive Order 13132 that agencies examine closely any policies that may have Federalism implications or limit the policymaking discretion of the States, HHS has engaged in efforts to consult with and work cooperatively with affected States. Throughout the process of developing this final rule, HHS has attempted to balance the States' interests in regulating health insurance issuers, and the Congress' intent to provide uniform protections to consumers in every State. By doing so, it is HHS's view that it has complied with the requirements of Executive Order 13132. Under the requirements set forth in section 8(a) of Executive Order 13132, and by the signatures affixed to this rule, HHS certifies that the CMS Center for Consumer Information and Insurance Oversight has complied with the requirements of Executive Order 13132 for the attached final rule in a meaningful and timely manner.
This final rule is subject to the Congressional Review Act provisions of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801 et seq.), which specifies that before a rule can take effect, the Federal agency promulgating the rule shall submit to each House of the Congress and to the Comptroller General a report containing a copy of the rule along with other specified information, and has been transmitted to the Congress and the Comptroller General for review.
Health care, Health insurance, Reporting and recordkeeping requirements.
Health care, Health insurance, Reporting and recordkeeping requirements.
Health care, Health insurance, Reporting and recordkeeping requirements, and State regulation of health insurance.
Administrative practice and procedure, Adverse selection, Health care, Health insurance, Health records, Organization and functions (Government agencies), Premium stabilization, Reporting and recordkeeping requirements, Reinsurance, Risk adjustment, Risk corridors, Risk mitigation, State and local governments.
Administrative practice and procedure, Health care access, Health insurance, Reporting and recordkeeping requirements, State and local governments, Cost-sharing reductions, Advance payments of premium tax credit, Administration and calculation of advance payments of the premium tax credit, Plan variations, Actuarial value.
Administrative practice and procedure, Advertising, Advisory Committees, Brokers, Conflict of interest, Consumer protection, Cost-sharing reductions, Cost-sharing reduction reconciliation, Administration and calculation of advance payments of the premium tax credit, Payment and Collection Reports, Grant programs—health, Grants administration, Health care, Health insurance, Health maintenance organization (HMO), Health records, Hospitals, American Indian/Alaska Natives, Individuals with disabilities, Loan programs—health, Organization and functions (Government agencies), Medicaid, Public assistance programs, Reporting and recordkeeping requirements, State and local governments, Sunshine Act, Technical assistance, Women, and Youth.
For the reasons set forth in the preamble, the Department of Health and Human Services amends 45 CFR parts 144, 146, 147, 153, 155, and 156 as set forth below:
Secs. 2701 through 2763, 2791, and 2792 of the Public Health Service Act 42 U.S.C. 300gg through 300gg-63, 300gg-91, and 300gg-92.
(c) * * * If the coverage is offered to an association member other than in connection with a group health plan, the coverage is considered individual health insurance coverage for purposes of 45 CFR parts 144 through 148.
For purposes of parts 146 (group market), 147 (group and individual market), 148 (individual market), and 150 (enforcement) of this subchapter, the following definitions apply unless otherwise provided:
(1) A grandfathered health plan offered in the individual health insurance market, the 12-month period that is designated as the policy year in the policy documents of the individual health insurance coverage. If there is no designation of a policy year in the policy document (or no such policy document is available), then the policy year is the deductible or limit year used under the coverage. If deductibles or other limits are not imposed on a yearly basis, the policy year is the calendar year.
(2) A non-grandfathered health plan offered in the individual health insurance market, or in a market in which the State has merged the individual and small group risk pools, for coverage issued or renewed beginning January 1, 2014, a calendar year for which health insurance coverage provides coverage for health benefits.
Secs. 2702 through 2705, 2711 through 2723, 2791, and 2792 of the Public Health Service Act (42 U.S.C. 300gg-1 through 300gg-5, 300gg-11 through 300gg-23, 200gg-91, and 300gg-92) (1996).
Section 146.145 also issued under secs. 2701 through 2763, 2791, and 2792 of the Public Health Service Act (42 U.S.C. 300gg through 300gg-63, 300gg-91, and 300gg-92), as amended (2010).
Secs. 2701 through 2763, 2791, and 2792 of the Public Health Service Act (42 U.S.C. 300gg through 300gg-63, 300gg-91, and 300gg-92), as amended.
(a)
(b) * * *
(2) * * * Health insurance coverage in the individual market or in a market in which the State has merged the individual and small group risk pools must be offered on a calendar year basis.
(c) * * *
(2) An issuer that denies health insurance coverage to an individual or an employer in any service area, in accordance with paragraph (c)(1)(ii) of this section, may not offer coverage in the individual, small group, or large group market, as applicable, for a period of 180 calendar days after the date the coverage is denied. This paragraph (c)(2) does not limit the issuer's ability to renew coverage already in force or relieve the issuer of the responsibility to renew that coverage.
(d) * * *
(1) * * *
(ii) It is applying this paragraph (d)(1) uniformly to all employers or individual in the large group, small group, or individual market, as applicable, in the State consistent with applicable State law and without regard to the claims experience of those individuals, employers and their employees (and their dependents) or any health status-related factor relating to such individuals, employees, and dependents.
(2) An issuer that denies health insurance coverage to any employer or individual in a state under paragraph (d)(1) of this section may not offer coverage in the large group, small group, or individual market, as applicable, in the State before the later of either of the following dates:
(a)
(d) * * *
(1) An issuer may elect to discontinue offering all health insurance coverage in the individual, small group, or large group market, or all markets, in a State in accordance with applicable State law only if—
Secs. 1311, 1321, 1341-1343, Pub. L. 111-148, 24 Stat. 119.
(c)
(a)
(1) All reinsurance contributions received from HHS for reinsurance payments and for administrative expenses;
(2) All claims for reinsurance payments received from issuers of reinsurance-eligible plans;
(3) All reinsurance payments made to issuers of reinsurance-eligible plans; and
(4) All administrative expenses incurred for the reinsurance program.
(b)
(c)
(1) Provide to HHS the results of the audit, in the manner and timeframe to be specified by HHS;
(2) Ensure that the audit addresses the prohibitions set forth in § 153.265;
(3) Identify to HHS any material weakness or significant deficiency identified in the audit, and address in writing to HHS how the State intends to correct any such material weakness or significant deficiency; and
(4) Make public a summary of the results of the audit, including any material weakness or significant deficiency and how the State intends to correct the material weakness or significant deficiency, in the manner and timeframe to be specified by HHS.
A State that establishes a reinsurance program must ensure that its applicable reinsurance entity does not use any funds for the support of reinsurance operations, including any reinsurance contributions provided under the national contribution rate for administrative expenses, for any of the following purposes:
(a) Staff retreats;
(b) Promotional giveaways;
(c) Excessive executive compensation; or
(d) Promotion of Federal or State legislative or regulatory modifications.
A. Adding paragraph (c)(4).
B. Revising the paragraph (d) subject heading and adding paragraphs (d)(3) and (4).
C. Removing paragraph (f).
The additions and revision read as follows:
(c) * * *
(4)
(d)
(3) In addition to requirements set forth in paragraphs (d)(1) and (2) of this section, to obtain re-approval from HHS to operate risk adjustment for a third benefit year, the State must, in the first benefit year for which it operates risk adjustment, provide to HHS an interim report, in a manner specified by HHS, including a detailed summary of its risk adjustment activities in the first 10 months of the benefit year, no later than December 31 of the applicable benefit year.
(4) To obtain re-approval from HHS to operate risk adjustment for each benefit year after the third benefit year, each
(i) The summary must include the results of a programmatic and financial audit for each benefit year of the State-operated risk adjustment program conducted by an independent qualified auditing entity in accordance with generally accepted auditing standards (GAAS).
(ii) The summary must identify any material weakness or significant deficiency identified in the audit and address how the State intends to correct any such material weakness or significant deficiency.
If a State is operating a risk adjustment program, it must keep an accounting of all receipts and expenditures related to risk adjustment payments and charges and the administration of risk adjustment-related functions and activities for each benefit year.
(a) * * *
(1) * * *
(i) Such plan or coverage is not major medical coverage, subject to paragraph (a)(3) of this section.
(3) Notwithstanding paragraph (a)(1)(i) of this section, a health insurance issuer must make reinsurance contributions for lives covered by its group health insurance coverage whether or not the insurance coverage constitutes major medical coverage, if—
(i) The group health plan provides health insurance coverage for those covered lives through more than one insurance policy that in combination constitute major medical coverage;
(ii) The lives are not covered by self-insured coverage of the group health plan (except for self-insured coverage limited to excepted benefits); and
(iii) The health insurance coverage under the policy offered by the health insurance issuer constitutes the greatest portion of inpatient hospitalization benefits under the group health plan.
(h)
(c)
(e) A QHP issuer is not subject to the provisions of this subpart with respect to a stand-alone dental plan.
(a)
(b)
(e)
(b)
(1) Increased by any risk adjustment charges paid by the issuer for the non-grandfathered health plans under the risk adjustment program established under subpart D of this part.
(i) Any risk adjustment charges paid by the issuer for the non-grandfathered health plans under the risk adjustment program established pursuant to subpart D of this part; and
(ii) Any reinsurance contributions made by the issuer for the non-grandfathered health plans under the transitional reinsurance program established pursuant to subpart C of this part.
(2) Reduced by —
(i) Any risk adjustment payments received by the issuer for the non-grandfathered health plans under the risk adjustment program established pursuant to subpart D of this part;
(ii) Any reinsurance payments received by the issuer for the non-grandfathered health plans under the transitional reinsurance program established pursuant to subpart C of this part; and
(iii) Any cost-sharing reduction payments received by the issuer for the QHP issuer's QHPs in a market within a State to the extent not reimbursed to the provider furnishing the item or service.
(c)
(b)
(a)
(b)
Title I of the Affordable Care Act, sections 1301, 1302, 1303, 1304, 1311, 1312, 1313, 1321, 1322, 1331, 1332, 1334, 1402, 1411, 1412, 1413, Pub. L. 111-148, 124 Stat. 119 (42 U.S.C. 18021-18024, 18031-18033, 18041-18042, 18051, 18054, 18071, and 18081-18083).
(h)
(1) Unless a refund is requested by or for the enrollee, the Exchange must, within 45 calendar days of discovery of the error, apply the excess premium paid by or for the enrollee to the enrollee's portion of the premium (or refund the amount directly). If any excess premium remains, the Exchange must then apply the excess premium to the enrollee's portion of the premium for each subsequent month for the remainder of the period of enrollment or benefit year until the excess premium is fully refunded (or refund the remaining amount directly). If any excess premium remains at the end of the period of enrollment or benefit year, the Exchange must refund any excess premium within 45 calendar days of the end of the period of enrollment or benefit year, whichever comes first.
(2) If a refund is requested by or for the enrollee, the refund must be provided within 45 calendar days of the date of the request.
(d) * * *
(10) It has been determined by the Exchange that a qualified individual or enrollee, or his or her dependents, was not enrolled in QHP coverage; was not enrolled in the QHP selected by the qualified individual or enrollee; or is eligible for but is not receiving advance payments of the premium tax credit or cost-sharing reductions as a result of misconduct on the part of a non-Exchange entity providing enrollment assistance or conducting enrollment activities. For purposes of this provision, misconduct includes, but is not limited to, the failure of the non-Exchange entity to comply with applicable standards under this part, part 156 of this subchapter, or other applicable Federal or State laws, as determined by the Exchange.
(j) * * *
(2) * * *
(i) Experiences an event described in § 155.420(d)(1), (2), (4), (5), (7), (8), (9), or (10);
(a)
(1) Keep an accurate accounting of Exchange receipts and expenditures in accordance with generally accepted accounting principles (GAAP).
(2) Monitor and report to HHS on Exchange related activities.
(3) Collect and report to HHS performance monitoring data.
(b)
(1) A financial statement presented in accordance with GAAP by April 1 of each year,
(2) Eligibility and enrollment reports,
(3) Performance monitoring data, and
(4) If the Exchange is collecting premiums under § 155.240, a report on instances in which it did not reduce an enrollee's premium by the amount of the advance payment of the premium tax credit in accordance with § 155.340(g)(1) and (2).
(c)
(1) Provide to HHS the results of the annual external audit; and
(2)) Inform HHS of any material weakness or significant deficiency identified in the audit and must develop and inform HHS of a corrective action plan for such material weakness or significant deficiency;
(3) Make public a summary of the results of the external audit.
(d)
(1) Compliance with paragraph (a)(1) of this section;
(2) Compliance with requirements under this part;
(3) Processes and procedures designed to prevent improper eligibility determinations and enrollment transactions; and
(4) Identification of errors that have resulted in incorrect eligibility determinations.
(a)
(1) Accommodate periodic auditing of the State Exchange's financial records; and
(2) Enable HHS or its designee(s) to inspect facilities, or otherwise evaluate the State- Exchange's compliance with Federal standards.
(b)
(1) Information concerning management and operation of the State Exchange's financial and other record keeping systems;
(2) Financial statements, including cash flow statements, and accounts receivable and matters pertaining to the costs of operations;
(3) Any financial reports filed with other Federal programs or State authorities;
(4) Data and records relating to the State Exchange's eligibility verifications and determinations, enrollment transactions, appeals, and plan variation certifications; and
(5) Qualified health plan contracting (including benefit review) data and consumer outreach and Navigator grant oversight information.
(c)
Title I of the Affordable Care Act, sections 1301-1304, 1311-1313, 1321-1322, 1324, 1334, 1342-1343, 1401-1402, Pub. L. 111-148, 124 Stat. 119 42 U.S.C. 18021-18024, 18031-18032, 18041-18042, 18044, 18054, 18061, 18063, 18071, 18082, 26 U.S.C. 36B, and 31 U.S.C. 9701).
(d) * * *
(1)
(3)
(ii) Beginning the quarter after HHS issues notification that the FF-SHOP can process quarterly rate updates, a health insurance issuer in the small group market (not including a merged market) may establish index rates and make the market-wide adjustments pursuant to paragraph (d)(1) of this section, and make the plan-level adjustments pursuant to paragraph (d)(2) of this section, no more frequently than quarterly, provided that any changes to rates must have effective dates of January 1, April 1, July 1, or October 1.
(a) * * *
(3) Provides coverage of the essential health benefits under section 1302(b) of the Affordable Care Act, except that the plan provides no benefits for any plan year (except as provided in paragraphs (a)(4) and (b) of this section) until the annual limitation on cost sharing in section 1302(c)(1) of the act is reached.
When a QHP issuer that offers one or more QHPs in a Federally-facilitated Exchange undergoes a change of ownership as recognized by the State in which the issuer offers the QHP, the QHP issuer must notify HHS of the change in a manner to be specified by HHS, and provide the legal name and Taxpayer Identification Number (TIN) of the new owner and the effective date of the change at least 30 days prior to the effective date of the change of ownership. The new owner must agree to adhere to all applicable statutes and regulations.
(c)
(i) If the excess cost sharing was paid by the provider, the QHP issuer must refund the excess cost sharing to the provider within 45 calendar days of discovery of the improper application.
(ii) If the excess cost sharing was not paid by the provider and is not requested by the enrollee as a refund, the QHP issuer must, within 45 calendar days of discovery of the error, apply the excess cost sharing paid by or for the enrollee to the enrollee's portion of the premium (or refund the amount directly). If any excess premium remains, the QHP issuer must apply the excess premium to the enrollee's portion of the premium for each subsequent month for the remainder of the period of enrollment or benefit year until the excess is fully applied (or refund any remaining amount directly). If any excess premium remains at the end of the period of enrollment or benefit year, the QHP issuer must refund the enrollee any remaining excess cost sharing paid by or for the enrollee within 45 calendar days of the end of the period of enrollment or benefit year, whichever comes first.
(iii) If the excess cost sharing was not paid by the provider, and if a refund is requested by the enrollee, the refund must be provided to the enrollee within 45 calendar days of the date of the request.
(2) If a QHP issuer provides an individual assigned to a plan variation greater cost-sharing reductions than required under the applicable plan variation, taking into account § 156.425(b) concerning continuity of deductibles and out-of-pocket amounts (if applicable), then the QHP issuer will not be eligible for reimbursement of any excess cost-sharing reductions provided to the enrollee, and may not seek reimbursement from the enrollee or the applicable provider for any of the excess cost-sharing reductions.
(d)
(1) If the QHP issuer discovers the improper assignment between the first and fifteenth day of the month, the QHP issuer must reassign the enrollee to the correct plan variation (or standard plan without cost-sharing reductions) by the first day of the following month.
(2) If the QHP issuer discovers the improper assignment between the sixteen and the last day of the month, the QHP issuer must reassign the individual to the correct plan variation (or standard plan without cost-sharing reductions) by the first day of the second following month.
(3) If, pursuant to a reassignment under this paragraph (d), a QHP issuer reassigns an enrollee from a more generous plan variation to a less generous plan variation of a QHP (or a standard plan without cost-sharing reductions), the QHP issuer will not be eligible for reimbursement for any of the excess cost-sharing reductions provided to the enrollee following the effective date of eligibility required by the Exchange, and may not seek reimbursement from the enrollee or the applicable provider for any of the excess cost-sharing reductions.
(4) If, pursuant to a reassignment under this paragraph (d), a QHP issuer reassigns an enrollee from a less generous plan variation (or a standard plan without cost-sharing reductions) to a more generous plan variation of a QHP, the QHP issuer must recalculate the enrollee's liability for cost sharing paid between the effective date of eligibility required by the Exchange and the date on which the issuer effectuated the change, and must refund any excess cost sharing paid by or for the enrollee during such period as follows:
(i) If the excess cost sharing was paid by the provider, the QHP issuer must refund the excess cost sharing to the provider within 45 calendar days of discovery of the improper assignment.
(ii) If the excess cost sharing was not paid by the provider and is not requested by the enrollee as a refund, the QHP issuer must, within 45 calendar days of discovery of the improper assignment, apply the excess cost sharing paid by or for the enrollee to the enrollee's portion of the premium (or refund the amount directly). If any excess premium remains, the QHP issuer must apply the excess premium to the enrollee's portion of the premium for each subsequent month for the remainder of the period of enrollment or benefit year until the excess is fully applied (or refund the remaining amount directly). If any excess premium remains at the end of the period of enrollment or benefit year, the QHP issuer must refund the enrollee any remaining excess cost sharing paid by or for the enrollee within 45 calendar days of the end of the period of enrollment or benefit year, whichever comes first.
(ii) If the excess cost sharing was not paid by the provider, then, if the enrollee requests a refund, the refund must be provided to the enrollee within 45 calendar days of the date of the request.
(c) * * *
(3)
(iii) The QHP issuer may not select the simplified methodology for a benefit year if the QHP issuer did not select the simplified methodology for the prior benefit year.
(iv) Notwithstanding paragraphs (c)(3)(ii) and (iii) of this section, if a QHP issuer merges with or acquires another issuer of a QHP on the Exchange, or acquires a QHP offered on the Exchange from another QHP issuer, and if one, but not all, of the merging, acquiring, or acquired parties had selected the simplified methodology for the benefit year, then for the benefit year in which the merger or acquisition took place, the QHP issuer must calculate the amounts that would have been paid using the methodology (whether the standard methodology described in paragraph (c)(2) of this section or the simplified methodology described in paragraph (c)(4) of this section) selected with respect to the plan variation prior to the start of the benefit year (even if the selection was not made by that QHP issuer). For the next benefit year (if such benefit year is 2015 or 2016), the QHP issuer may select the simplified methodology (subject to paragraph (c)(3)(ii) of this section but, for that benefit year, not paragraph (c)(3)(iii) of this section) or the standard methodology.
(4)
(i) For plan variation policies with total allowed costs for EHB for the benefit year that are:
(A) Less than or equal to the effective deductible, the amount that the enrollees would have paid under the standard plan is equal to the total allowed costs for EHB under the policy for the benefit year multiplied by the effective pre-deductible coinsurance rate.
(B) Greater than the effective deductible but less than the effective claims ceiling, the amount that the enrollees would have paid under the standard plan is equal to the sum of (x) the average deductible, plus (y) the effective non-deductible cost sharing, plus (z) the difference, if positive, between the total allowed costs under the policy for the benefit year for EHB that are subject to a deductible and the average deductible, multiplied by the effective post-deductible coinsurance rate.
(C) Greater than or equal to the effective claims ceiling, the amount that the enrollees would have paid under the standard plan is equal to the annual limitation on cost sharing for the standard plan (as defined at 45 CFR 156.400), or, at the QHP issuer's election on a policy-by-policy basis, the amount calculated pursuant to the standard methodology described in paragraph (c)(2) of this section,
(ii) The QHP issuer must calculate one or more sets of effective cost-sharing parameters, as described in paragraph (c)(4)(iii) of this section, based on policies assigned to the standard plan without cost-sharing reductions for the entire benefit year and must separately apply each set of effective cost-sharing parameters to the corresponding subgroup of total allowed costs for EHB for each plan variation policy, as described in paragraph (c)(4)(i) of this section, as follows:
(A) If the standard plan has separate cost-sharing parameters for self-only coverage and other than self-only coverage, but does not have separate cost-sharing parameters for pharmaceutical and medical services, the QHP issuer must calculate and apply separate sets of effective cost-sharing parameters based on the costs of enrollees in the standard plan with self-only coverage, and based on the costs of enrollees in the standard plan with other than self-only coverage.
(B) If the standard plan has separate cost-sharing parameters for pharmaceutical and medical services, but does not have separate cost-sharing parameters for self-only coverage and other than self-only coverage, the QHP issuer must calculate and apply separate sets of effective cost-sharing parameters based on the medical costs of the enrollees in the standard plan, and based on the pharmaceutical costs of the enrollees in the standard plan.
(C) If the standard plan has separate cost-sharing parameters for self-only coverage and other than self-only coverage, and also has separate cost-sharing parameters for pharmaceutical and medical services, the QHP issuer must calculate and apply separate sets of effective cost-sharing parameters based on the medical costs of enrollees in the standard plan with self-only coverage, based on the pharmaceutical costs of enrollees in the standard plan with self-only coverage, based on the medical costs of enrollees in the standard plan with other than self-only coverage, and based on the pharmaceutical costs of enrollees in the standard plan with other than self-only coverage.
(iii) The effective cost-sharing parameters for the standard plan without cost-sharing reductions must be calculated based on policies assigned to the standard plan for the entire benefit year for each of the required subgroups under paragraph (c)(4)(ii) of this section as follows:
(A) If the standard plan has only one deductible (for the applicable subgroup), the average deductible of the standard plan is that deductible amount. If the standard plan has more than one deductible (for the applicable subgroup), the average deductible is the weighted average of the deductibles, weighted by allowed costs for EHB under the standard plan for the benefit year that are subject to each separate deductible. Services that are not subject to any deductible (including services subject to copayments or coinsurance but not any deductible) are not to be incorporated into the calculation of the average deductible.
(B) The effective non-deductible cost sharing for the applicable subgroup is the average portion of total allowed costs for EHB that are not subject to any deductible for the standard plan for the benefit year incurred for standard plan enrollees and payable by the enrollees as cost sharing. The effective non-deductible cost sharing must be calculated based only on standard plan policies with total allowed costs for EHB for the benefit year that are above the effective deductible but for which associated cost sharing for EHB is less than the annual limitation on cost sharing.
(C) The effective deductible for the applicable subgroup is equal to the sum of the average deductible and the average total allowed costs for EHB that are not subject to any deductible for the standard plan for the benefit year. The average total allowed costs for EHB that
(D) The effective pre-deductible coinsurance rate for the applicable subgroup is the proportion of the total allowed costs for EHB under the standard plan for the benefit year incurred for standard plan enrollees and payable as cost sharing. The effective pre-deductible coinsurance rate must be calculated based only on standard plan policies with total allowed costs for EHB for the benefit year that are less than or equal to the effective deductible.
(E) The effective post-deductible coinsurance rate for the applicable subgroup is the quotient of (x) the portion of average allowed costs for EHB subject to a deductible incurred for enrollees for the benefit year, and payable by the enrollees as cost sharing other than through a deductible, over the difference of (y) the average allowed costs for EHB subject to a deductible incurred for enrollees for the benefit year, and (z) the average deductible. The effective post-deductible coinsurance rate must be calculated based only on standard plan policies with total allowed costs for EHB for the benefit year that are above the effective deductible but for which associated cost sharing for EHB is less than the annual limitation on cost sharing.
(F) The effective claims ceiling for the applicable subgroup is calculated as the effective deductible plus the quotient of (x) the difference between the annual limitation on cost sharing and the sum of the average deductible and the effective non-deductible cost sharing, divided by (y) the effective post-deductible coinsurance rate.
(iv) If a QHP issuer uses the simplified methodology described in this paragraph (c)(4), and the QHP issuer's standard plan does not meet any of the criteria in paragraphs (c)(4)(v)(A) through (D) of this section, the QHP issuer must also submit to HHS, in the manner and timeframe established by HHS, the following information for each standard plan offered by the QHP issuer in the individual market through the Exchange for each of the required subgroups described in paragraph (c)(4)(ii) of this section:
(A) The average deductible for each applicable subgroup;
(B) The effective deductible for each applicable subgroup;
(C) The effective non-deductible cost sharing amount for each applicable subgroup;
(D) The effective pre-deductible coinsurance rate for each applicable subgroup;
(E) The effective post-deductible coinsurance rate for each applicable subgroup;
(F) The effective claims ceiling for each applicable subgroup; and
(G) A memorandum developed by a member of the American Academy of Actuaries in accordance with generally accepted actuarial principles and methodologies that describes how the QHP issuer calculated the effective cost-sharing parameters for each applicable subgroup for the standard plan.
(v) Notwithstanding paragraphs (c)(4)(i) through (iii) of this section, if a QHP issuer's standard plan meets the criteria in any of the following subparagraphs, and the QHP issuer has selected the simplified methodology described in this paragraph (c)(4), then the QHP issuer must calculate the amount that the enrollees in the plan variation would have paid under the standard plan without cost-sharing reductions as the lesser of the annual limitation on cost sharing for the standard plan or the amount equal to the product of, (x) one minus the standard plan's actuarial value, as calculated under 45 CFR 156.135, and (y) the total allowed costs for EHB for the benefit year under each policy that was assigned to a plan variation for any portion of the benefit year.
(A) The standard plan has separate cost-sharing parameters for self-only coverage and other than self-only coverage, does not have separate cost-sharing parameters for pharmaceutical and medical services, and has an enrollment during the benefit year of fewer than 12,000 member months for coverage with total allowed costs for EHB for the benefit year that are greater than the effective deductible, but for which associated cost sharing for EHB is less than the annual limitation on cost sharing, in either of the following categories -
(1) Self-only coverage; or
(2) Other than self-only coverage.
(B) The standard plan has separate cost-sharing parameters for pharmaceutical and medical services, does not have separate cost-sharing parameters for self-only coverage and other than self-only coverage, and has an enrollment during the benefit year of fewer than 12,000 member months for coverage with total allowed costs for EHB for the benefit year that are greater than the effective deductible, but for which associated cost sharing for EHB is less than the annual limitation on cost sharing, in either of the following categories:
(1) Coverage of medical services; or
(2) Coverage of pharmaceutical services.
(C) The standard plan has separate cost-sharing parameters for self-only coverage and other than self-only coverage and for pharmaceutical and medical services, and has an enrollment during the benefit year of fewer than 12,000 member months for coverage with total allowed costs for EHB for the benefit year that are greater than the effective deductible, but for which associated cost sharing for EHB is less than the annual limitation on cost sharing, in any of the following categories:
(1) Self-only coverage of medical services;
(2) Self-only coverage of pharmaceutical services;
(3) Other than self-only coverage of medical services; or
(4) Other than self-only coverage of pharmaceutical services.
(D) The standard plan does not have separate cost-sharing parameters for pharmaceutical and medical services, or for self-only coverage and other than self-only coverage, and has an enrollment during the benefit year of fewer than 12,000 member months with total allowed costs for EHB for the benefit year that are greater than the effective deductible, but for which associated cost sharing for EHB is less than the annual limitation on cost sharing.
(vi) Notwithstanding paragraphs (c)(4)(i)(A) and (B) of this section, and paragraphs (c)(4)(iii)(A) through (E) of this section, if more than eighty percent of the total allowed costs for EHB for the benefit year under a standard plan for a subgroup that requires a separate set of effective cost-sharing parameters pursuant to paragraph (c)(4)(ii) are not subject to a deductible, then:
(A) The average deductible, the effective non-deductible cost sharing, and the effective deductible for the subgroup equal zero;
(B) The effective pre-deductible coinsurance rate for the subgroup is equal to the effective post-deductible coinsurance rate for the subgroup, which is determined based on all standard plan policies for the applicable subgroup for which associated cost sharing for EHB is less than the annual limitation on cost sharing, and calculated for the applicable subgroup as the proportion of the total allowed costs for EHB under the standard plan for the benefit year incurred for standard plan enrollees and payable as
(C) The amount that enrollees in the applicable subgroup in plan variation policies with total allowed costs for EHB for the benefit year that are less than the effective claims ceiling would have paid under the standard plan must be calculated using the formula in paragraph (c)(4)(i)(A).
(c)
(1) Unless a refund is requested by or for the enrollee, the QHP issuer must, within 45 calendar days of discovery of the error, apply the excess premium paid by or for the enrollee to the enrollee's portion of the premium (or refund the amount directly). If any excess premium remains, the QHP issuer must apply the excess premium to the enrollee's portion of the premium for each subsequent month for the remainder of the period of enrollment or benefit year until the excess is fully applied (or refund the remaining amount directly). If any excess premium remains at the end of the period of enrollment or benefit year, the QHP issuer must refund any excess premium within 45 calendar days of the end of the period of enrollment or benefit year, whichever comes first.
(2) If a refund is requested by or for the enrollee, the refund must be provided within 45 calendar days of the date of the request.
(a)
(b)
(c)
(a)
(1) Periodically audit financial records related to QHP issuers' participation in a Federally-facilitated Exchange, and evaluate the ability of QHP issuers to bear the risk of potential financial losses; and
(2) Conduct compliance reviews or otherwise monitor QHP issuers' compliance with all Exchange standards applicable to issuers offering QHPs in a federally-facilitated Exchange as listed in this part.
(b)
(c)
(d)
(a)
(b)
(1) The QHP issuer's books and contracts, including the QHP issuer's policy manuals and other QHP plan benefit information provided to the QHP issuer's enrollees;
(2) The QHP issuer's policies and procedures, protocols, standard operating procedures, or other similar manuals related to the QHP issuer's activities in a Federally-facilitated Exchange;
(3) Any other information reasonably necessary for HHS to—
(i) Evaluate the QHP issuer's compliance with QHP certification standards and other Exchange standards applicable to issuers offering QHPs in a Federally-facilitated Exchange;
(ii) Evaluate the QHP's performance, including its adherence to an effective compliance plan, within a Federally-facilitated Exchange;
(iii) Verify that the QHP issuer has performed the duties attested to as part of the QHP certification process; and
(iv) Assess the likelihood of fraud or abuse.
(c)
(d)
(1) A compliance review under this section will be carried out as an onsite or desk review based on the specific circumstances.
(2) Unless otherwise specified, nothing in this section is intended to preempt Federal laws and regulations related to information privacy and security.
(e)
In this subpart, unless the context indicates otherwise:
(a) The ALJ has the authority, including all of the authority conferred by the Administrative Procedure Act (5 U.S.C. 554a), to adopt whatever procedures may be necessary or proper to carry out in an efficient and effective manner the ALJ's duty to provide a fair and impartial hearing on the record and to issue an initial decision concerning the imposition of a civil money penalty or the decertification of a QHP offered in a Federally-facilitated Exchange.
(b) The ALJ's authority includes the authority to modify, consistent with the Administrative Procedures Act (5 U.S.C. 552a), any hearing procedures set out in this subpart.
(c) The ALJ does not have the authority to find invalid or refuse to follow Federal statutes or regulations.
(a) A respondent has a right to a hearing before an ALJ if it files a request for hearing that complies with § 156.907(a), within 30 days after the date of issuance of either HHS' notice of proposed assessment under § 156.805, notice of decertification of a QHP under § 156.810(c) or § 156.810(d). The request for hearing should be addressed as instructed in the notice of proposed determination. “date of issuance” is five (5) days after the filing date, unless there is a showing that the document was received earlier.
(b) The ALJ may extend the time for filing a request for hearing only if the ALJ finds that the respondent was prevented by events or circumstances beyond its control from filing its request within the time specified above. Any request for an extension of time must be made promptly by written motion.
(a) The request for hearing must do the following:
(1) Identify any factual or legal bases for the assessment or decertifications with which the respondent disagrees.
(2) Describe with reasonable specificity the basis for the disagreement, including any affirmative facts or legal arguments on which the respondent is relying.
(b) Identify the relevant notice of assessment or decertification by date and attach a copy of the notice.
The ALJ may permit CMS to amend its notice of assessment or decertification, or permit the respondent to amend a request for hearing that complies with § 156.907(a), if the ALJ finds that no undue prejudice to either party will result.
An ALJ will order a request for hearing dismissed if the ALJ determines that:
(a) The request for hearing was not filed within 30 days as specified by § 156.905(a) or any extension of time granted by the ALJ pursuant to § 156.905(b).
(b) The request for hearing fails to meet the requirements of § 156.907.
(c) The entity that filed the request for hearing is not a respondent under § 156.901.
(d) The respondent has abandoned its request.
(e) The respondent withdraws its request for hearing.
HHS has exclusive authority to settle any issue or any case, without the consent of the ALJ at any time before or after the ALJ's decision.
(a) The ALJ may grant the request of an entity, other than the respondent, to intervene if all of the following occur:
(1) The entity has a significant interest relating to the subject matter of the case.
(2) Disposition of the case will, as a practical matter, likely impair or impede the entity's ability to protect that interest.
(3) The entity's interest is not adequately represented by the existing parties.
(4) The intervention will not unduly delay or prejudice the adjudication of the rights of the existing parties.
(b) A request for intervention must specify the grounds for intervention and the manner in which the entity seeks to participate in the proceedings. Any participation by an intervenor must be in the manner and by any deadline set by the ALJ.
(c) The Department of Labor (DOL) or the Internal Revenue Service (IRS) may intervene without regard to paragraphs (a)(1) through (3) of this section.
(a) The ALJ has the authority to hear and decide the following issues:
(1) Whether a basis exists to assess a civil money penalty against the respondent.
(2) Whether the amount of the assessed civil money penalty is reasonable.
(3) Whether a basis exists to decertify a QHP offered by the respondent in a Federally-facilitated Exchange.
(b) In deciding whether the amount of a civil money penalty is reasonable, the ALJ—
(1) Will apply the factors that are identified in § 156.805 for civil money penalties.
(2) May consider evidence of record relating to any factor that HHS did not apply in making its initial determination, so long as that factor is identified in this subpart.
(c) If the ALJ finds that a basis exists to assess a civil money penalty, the ALJ may sustain, reduce, or increase the penalty that HHS assessed.
(a) All hearings before an ALJ are on the record. The ALJ may receive argument or testimony in writing, in person, or by telephone. The ALJ may receive testimony by telephone only if the ALJ determines that doing so is in the interest of justice and economy and that no party will be unduly prejudiced. The ALJ may require submission of a witness' direct testimony in writing only if the witness is available for cross-examination.
(b) The ALJ may decide a case based solely on the written record where there is no disputed issue of material fact the resolution of which requires the receipt of oral testimony.
Any attorney who is to appear on behalf of a party must promptly file, with the ALJ, a notice of appearance.
No party or person (except employees of the ALJ's office) may communicate in any way with the ALJ on any matter at issue in a case, unless on notice and opportunity for both parties to participate. This provision does not prohibit a party or person from inquiring about the status of a case or asking routine questions concerning administrative functions or procedures.
(a) Any request to the ALJ for an order or ruling must be by motion, stating the relief sought, the authority relied upon, and the facts alleged. All motions must be in writing, with a copy served on the opposing party, except in either of the following situations:
(1) The motion is presented during an oral proceeding before an ALJ at which both parties have the opportunity to be present.
(2) An extension of time is being requested by agreement of the parties or with waiver of objections by the opposing party.
(b) Unless otherwise specified in this subpart, any response or opposition to a motion must be filed within 20 days of the party's receipt of the motion. The ALJ does not rule on a motion before the time for filing a response to the motion has expired except where the response is filed at an earlier date, where the opposing party consents to the motion being granted, or where the ALJ determines that the motion should be denied.
(a) Every submission filed with the ALJ must be filed in triplicate, including one original of any signed documents, and include:
(1) A caption on the first page, setting forth the title of the case, the docket number (if known), and a description of the submission (such as “Motion for Discovery”).
(2) The signatory's name, address, and telephone number.
(3) A signed certificate of service, specifying each address to which a copy of the submission is sent, the date on which it is sent, and the method of service.
(b) A party filing a submission with the ALJ must, at the time of filing, serve a copy of such submission on the opposing party. An intervenor filing a submission with the ALJ must, at the time of filing, serve a copy of the submission on all parties. Service must be made by mailing or hand delivering a copy of the submission to the opposing party. If a party is represented by an attorney, service must be made on the attorney.
(a) For purposes of this subpart, in computing any period of time, the time begins with the day following the act, event, or default and includes the last day of the period unless it is a Saturday, Sunday, or legal holiday observed by the Federal government, in which event it includes the next business day. When the period of time allowed is less than seven days, intermediate Saturdays, Sundays, and legal holidays observed by the Federal government are excluded from the computation.
(b) The period of time for filing any responsive pleading or papers is determined by the date of receipt (as defined in § 156.901) of the submission to which a response is being made.
(c) The ALJ may grant extensions of the filing deadlines specified in these regulations or set by the ALJ for good cause shown (except that requests for extensions of time to file a request for hearing may be granted only on the grounds specified in § 156.905(b)).
After receipt of the request for hearing, the ALJ assigned to the case or someone acting on behalf of the ALJ will send a letter to the parties that acknowledges receipt of the request for hearing, identifies the docket number assigned to the case, provides instructions for filing submissions and other general information concerning procedures, and sets out the next steps in the case.
(a) The parties must identify any need for discovery from the opposing party as soon as possible, but no later than the time for the reply specified in § 156.937(c). Upon request of a party, the ALJ may stay proceedings for a reasonable period pending completion of discovery if the ALJ determines that a party would not be able to make the submissions required by § 156.937 without discovery. The parties should attempt to resolve any discovery issues informally before seeking an order from the ALJ.
(b) Discovery devices may include requests for production of documents, requests for admission, interrogatories, depositions, and stipulations. The ALJ orders interrogatories or depositions only if these are the only means to develop the record adequately on an issue that the ALJ must resolve to decide the case.
(c) Each discovery request must be responded to within 30 days of receipt, unless that period of time is extended for good cause by the ALJ.
(d) A party to whom a discovery request is directed may object in writing for any of the following reasons:
(1) Compliance with the request is unduly burdensome or expensive.
(2) Compliance with the request will unduly delay the proceedings.
(3) The request seeks information that is wholly outside of any matter in dispute.
(4) The request seeks privileged information. Any party asserting a claim of privilege must sufficiently describe the information or document being withheld to show that the privilege applies. If an asserted privilege applies to only part of a document, a party withholding the entire document must state why the nonprivileged part is not segregable.
(5) The disclosure of information responsive to the discovery request is prohibited by law.
(e) Any motion to compel discovery must be filed within 10 days after receipt of objections to the party's discovery request, within 10 days after the time for response to the discovery request has elapsed if no response is received, or within 10 days after receipt of an incomplete response to the discovery request. The motion must be reasonably specific as to the information or document sought and must state its relevance to the issues in the case.
(a) Within 60 days of its receipt of the acknowledgment provided for in § 156.931, the respondent must file the following with the ALJ:
(1) A statement of its arguments concerning CMS's notice of assessment or decertification (respondent's brief), including citations to the respondent's hearing exhibits provided in accordance with paragraph (a)(2) of this section. The brief may not address factual or legal bases for the assessment or decertification that the respondent did not identify as disputed in its request for hearing or in an amendment to that request permitted by the ALJ.
(2) All documents (including any affidavits) supporting its arguments, tabbed and organized chronologically and accompanied by an indexed list identifying each document.
(3) A statement regarding whether there is a need for an in-person hearing and, if so, a list of proposed witnesses and a summary of their expected testimony that refers to any factual dispute to which the testimony will relate.
(4) Any stipulations or admissions.
(b) Within 30 days of its receipt of the respondent's submission required by paragraph (a) of this section, CMS will file the following with the ALJ:
(1) A statement responding to the respondent's brief, including the respondent's proposed hearing exhibits, if appropriate. The statement may include citations to CMS's proposed hearing exhibits submitted in accordance with paragraph (b)(2) of this section.
(2) Any documents supporting CMS's response not already submitted as part of the respondent's proposed hearing exhibits, organized and indexed as indicated in paragraph (a)(2) of this section (CMS's proposed hearing exhibits).
(3) A statement regarding whether there is a need for an in-person hearing and, if so, a list of proposed witnesses and a summary of their expected testimony that refers to any factual dispute to which the testimony will relate.
(4) Any admissions or stipulations.
(c) Within 15 days of its receipt of CMS's submission required by paragraph (b) of this section, the respondent may file with the ALJ a reply to CMS's submission.
(a) Any proposed hearing exhibit submitted by a party in accordance with § 156.937 is deemed part of the record unless the opposing party raises an objection to that exhibit and the ALJ rules to exclude it from the record. An objection must be raised either in writing prior to the prehearing conference provided for in § 156.941 or at the prehearing conference. The ALJ may require a party to submit the original hearing exhibit on his or her own motion or in response to a challenge to the authenticity of a proposed hearing exhibit.
(b) A party may introduce a proposed hearing exhibit following the times for submission specified in § 156.937 only if the party establishes to the satisfaction of the ALJ that it could not have produced the exhibit earlier and that the opposing party will not be prejudiced.
An ALJ may schedule one or more prehearing conferences (generally conducted by telephone) on the ALJ's own motion or at the request of either party for the purpose of any of the following:
(a) Hearing argument on any outstanding discovery request.
(b) Establishing a schedule for any supplements to the submissions required by § 156.937 because of information obtained through discovery.
(c) Hearing argument on a motion.
(d) Discussing whether the parties can agree to submission of the case on a stipulated record.
(e) Establishing a schedule for an in-person hearing, including setting deadlines for the submission of written direct testimony or for the written reports of experts.
(f) Discussing whether the issues for a hearing can be simplified or narrowed.
(g) Discussing potential settlement of the case.
(h) Discussing any other procedural or substantive issues.
(a) In all cases before an ALJ—
(1) CMS has the burden of coming forward with evidence sufficient to establish a prima facie case;
(2) The respondent has the burden of coming forward with evidence in response, once CMS has established a prima facie case; and
(3) CMS has the burden of persuasion regarding facts material to the assessment or decertification; and
(4) The respondent has the burden of persuasion regarding facts relating to an affirmative defense.
(b) The preponderance of the evidence standard applies to all cases before the ALJ.
(a) The ALJ will determine the admissibility of evidence.
(b) Except as provided in this part, the ALJ will not be bound by the Federal Rules of Evidence. However, the ALJ may apply the Federal Rules of Evidence where appropriate; for example, to exclude unreliable evidence.
(c) The ALJ excludes irrelevant or immaterial evidence.
(d) Although relevant, evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or by considerations of undue delay or needless presentation of cumulative evidence.
(e) Although relevant, evidence is excluded if it is privileged under Federal law.
(f) Evidence concerning offers of compromise or settlement made in this action will be inadmissible to the extent provided in the Federal Rules of Evidence.
(g) Evidence of acts other than those at issue in the instant case is admissible in determining the amount of any civil money penalty if those acts are used under § 156.805 of this part to consider the entity's prior record of compliance, or to show motive, opportunity, intent, knowledge, preparation, identity, or lack of mistake. This evidence is admissible regardless of whether the acts occurred during the statute of limitations period applicable to the acts that constitute the basis for liability in the case and regardless of whether HHS' notice sent in accordance with § 156.805 referred to them.
(h) The ALJ will permit the parties to introduce rebuttal witnesses and evidence.
(i) All documents and other evidence offered or taken for the record will be open to examination by all parties, unless the ALJ orders otherwise for good cause shown.
(j) The ALJ may not consider evidence regarding the willingness and ability to enter into and successfully complete a corrective action plan when that evidence pertains to matters occurring after HHS' notice under § 156.805(d) or § 156.810(c) or § 156.810(d).
(a) Any testimony that is taken in-person or by telephone is recorded and transcribed. The ALJ may order that other proceedings in a case, such as a prehearing conference or oral argument of a motion, be recorded and transcribed.
(b) The transcript of any testimony, exhibits and other evidence that is admitted, and all pleadings and other documents that are filed in the case constitute the record for purposes of an ALJ decision.
(c) For good cause, the ALJ may order appropriate redactions made to the record.
Each party is entitled to file proposed findings and conclusions, and supporting reasons, in a posthearing brief. The ALJ will establish the schedule by which such briefs must be filed. The ALJ may direct the parties to brief specific questions in a case and may impose page limits on posthearing briefs. Additionally, the ALJ may allow the parties to file posthearing reply briefs.
The ALJ will issue an initial agency decision based only on the record and on applicable law; the decision will contain findings of fact and conclusions of law. The ALJ's decision is final and appealable after 30 days unless it is modified or vacated under § 156.957.
(a) The ALJ may sanction a party or an attorney for failing to comply with an order or other directive or with a requirement of a regulation, for abandonment of a case, or for other actions that interfere with the speedy, orderly or fair conduct of the hearing. Any sanction that is imposed will relate reasonably to the severity and nature of the failure or action.
(b) A sanction may include any of the following actions:
(1) In the case of failure or refusal to provide or permit discovery, drawing negative fact inferences or treating such failure or refusal as an admission by deeming the matter, or certain facts, to be established.
(2) Prohibiting a party from introducing certain evidence or otherwise advocating a particular claim or defense.
(3) Striking pleadings, in whole or in part.
(4) Staying the case.
(5) Dismissing the case.
(6) Entering a decision by default.
(7) Refusing to consider any motion or other document that is not filed in a timely manner.
(8) Taking other appropriate action.
(a) The Administrator of CMS (which for purposes of this section may include his or her delegate), at his or her discretion, may review in whole or in part any initial agency decision issued under § 156.953.
(b) The Administrator may decide to review an initial agency decision if it appears from a preliminary review of the decision (or from a preliminary review of the record on which the initial agency decision was based, if available at the time) that:
(1) The ALJ made an erroneous interpretation of law or regulation.
(2) The initial agency decision is not supported by substantial evidence.
(3) The ALJ has incorrectly assumed or denied jurisdiction or extended his or her authority to a degree not provided for by statute or regulation.
(4) The ALJ decision requires clarification, amplification, or an alternative legal basis for the decision.
(5) The ALJ decision otherwise requires modification, reversal, or remand.
(c) Within 30 days of the date of the initial agency decision, the Administrator will mail a notice advising the respondent of any intent to review the decision in whole or in part.
(d) Within 30 days of receipt of a notice that the Administrator intends to review an initial agency decision, the respondent may submit, in writing, to the Administrator any arguments in support of, or exceptions to, the initial agency decision.
(e) This submission of the information indicated in paragraph (d) of this section must be limited to issues the Administrator has identified in his or her notice of intent to review, if the Administrator has given notice of an intent to review the initial agency decision only in part. A copy of this submission must be sent to the other party.
(f) After receipt of any submissions made pursuant to paragraph (d) of this section and any additional submissions for which the Administrator may provide, the Administrator will affirm, reverse, modify, or remand the initial agency decision. The Administrator will mail a copy of his or her decision to the respondent.
(g) The Administrator's decision will be based on the record on which the initial agency decision was based (as forwarded by the ALJ to the Administrator) and any materials submitted pursuant to paragraphs (b), (d), and (f) of this section.
(h) The Administrator's decision may rely on decisions of any courts and other applicable law, whether or not cited in the initial agency decision.
(a)
(1) Filing a notice of appeal in that court within 30 days from the date of a final order.
(2) Simultaneously sending a copy of the notice of appeal by registered mail to HHS.
(b)
(c)
If any entity fails to pay an assessment after it becomes a final order, or after the court has entered final judgment in favor of CMS, CMS refers the matter to the Attorney General, who brings an action against the entity in the appropriate United States district court to recover the amount assessed.
In an action brought under § 156.961, the validity and appropriateness of the final order imposing a civil money penalty is not subject to review.
(a)
(b)
(1) Sign and submit an application form for approval in accordance with paragraph (a) of this section;
(2) Ensure, on an annual basis, that appropriate staff participate in enrollee satisfaction survey vendor training and successfully complete a post-training certification exercise as established by HHS;
(3) Ensure the accuracy of their data collection, calculation and submission processes and attest to HHS the veracity of the data and these processes;
(4) Sign and execute a standard HHS data use agreement, in a form and manner to be determined by HHS, that establishes protocols related to the disclosure, use, and reuse of HHS data;
(5) Adhere to the enrollee satisfaction survey protocols and technical specifications in a manner and form required by HHS;
(6) Develop and submit to HHS a quality assurance plan and any supporting documentation as determined to be relevant by HHS. The plan must describe in adequate detail the implementation of and compliance with all required protocols and technical specifications described in paragraph (b)(5) of this section;
(7) Adhere to privacy and security standards established and implemented under § 155.260 of this subchapter by the Exchange with which they are associated;
(8) Comply with all applicable State and Federal laws;
(9) Become a registered user of the enrollee satisfaction survey data warehouse to submit files to HHS on behalf of its authorized QHP contracts;
(10) Participate in and cooperate with HHS oversight for quality-related activities, including, but not limited to: review of the enrollee satisfaction survey vendor's quality assurance plan and other supporting documentation; analysis of the vendor's submitted data and sampling procedures; and site visits and conference calls; and,
(11) Comply with minimum business criteria as established by HHS.
(c)
(a)
(1) Confirm to HHS that the amounts identified in the payment and collections report for the timeframe specified in the report accurately reflect applicable payments owed by the issuer to the Federal government and the payments owed to the issuer by the Federal government; or
(2) Describe to HHS any inaccuracy it identifies in the payment and collections report.
(b)
Office of the Comptroller of the Currency, Treasury; Board of Governors of the Federal Reserve System; Federal Deposit Insurance Corporation; Farm Credit Administration; National Credit Union Administration.
Joint notice of proposed rulemaking.
The Office of the Comptroller of the Currency (OCC), Board of Governors of the Federal Reserve System (Board), Federal Deposit Insurance Corporation (FDIC), the Farm Credit Administration (FCA), and the National Credit Union Administration (NCUA) (collectively, the Agencies) are proposing to amend their regulations regarding loans in areas having special flood hazards to implement provisions of the Biggert-Waters Flood Insurance Reform Act of 2012. Specifically, the proposal would establish requirements with respect to the escrow of flood insurance payments, the acceptance of private flood insurance coverage, and the force-placement of flood insurance. The proposal also would clarify the Agencies' flood insurance regulations with respect to other amendments made by the Act and make technical corrections. Furthermore, the OCC and the FDIC are proposing to integrate their flood insurance regulations for national banks and Federal savings associations and for State non-member banks and State savings associations, respectively.
Comments must be received on or before December 10, 2013, except that comments on the Paperwork Reduction Act analysis in part V of the
Interested parties are encouraged to submit written comments jointly to all of the Agencies. Commenters are encouraged to use the title “Loans in Areas Having Special Flood Hazards” to facilitate the organization and distribution of comments among the Agencies. Interested parties are invited to submit written comments to:
OCC: Because paper mail in the Washington, DC area and at the OCC is subject to delay, commenters are encouraged to submit comments by the Federal eRulemaking Portal or email, if possible. Please use the title “Loans in Areas Having Special Flood Hazards” to facilitate the organization and distribution of the comments. You may submit comments by any of the following methods:
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You may review comments and other related materials that pertain to this rulemaking action by any of the following methods:
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All public comments will be made available on the Board's Web site at
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You may review copies of all comments we receive at our office in McLean, Virginia or on our Web site at
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You can view all public comments on NCUA's Web site at
The Biggert-Waters Flood Insurance Reform Act of 2012
The National Flood Insurance Act of 1968 (1968 Act)
Until the adoption of the FDPA in 1973, the purchase of flood insurance was voluntary. The FDPA required the mandatory purchase of flood insurance and directed the OCC, Board, FDIC, NCUA, and the former Office of Thrift Supervision (OTS)
Title V of the Riegle Community Development and Regulatory Improvement Act of 1994, also known as the National Flood Insurance Reform Act of 1994 (Reform Act), comprehensively amended the Federal flood insurance statutes.
The Reform Act required the Agencies to revise their flood insurance regulations and required the FCA to promulgate flood insurance regulations for the first time. The Agencies fulfilled these requirements by issuing a joint final rule in August 1996.
Among other changes,
The civil money penalty provisions,
As indicated above, the Agencies propose to revise their respective flood insurance regulations to implement the Act's amendments addressing the escrow of flood insurance payments, private flood insurance, and force-placed insurance. These provisions, and other amendments, proposed by this rulemaking are summarized below and more specifically described in IV. Section-by-Section Analysis of this preamble. Although the Agencies' proposals are substantively consistent, the format of the regulatory text varies
First, the Agencies' proposal generally would require regulated lending institutions, or servicers acting on their behalf, to escrow premiums and fees for flood insurance for any loans secured by residential improved real estate or a mobile home, unless the institutions qualify for the statutory exception. Except as may be required under applicable State law, a regulated lending institution is not required to escrow if it has total assets of less than $1 billion and, as of the Act's date of enactment, July 6, 2012, was not required by Federal or State law to escrow taxes or insurance for the term of the loan and did not have a policy to require escrow of taxes and insurance. The Agencies are proposing to implement the exception substantially as set forth in the statute.
Second, consistent with the Act, the Agencies' proposal would require that regulated lending institutions accept private flood insurance that meets the statutory definition to satisfy the mandatory purchase requirement. The proposal also specifically requests comment on whether the Agencies should use their authority under the FDPA to include a provision in the final rules that expressly permits regulated lending institutions to accept a flood insurance policy issued by a private insurer that does not meet the Act's definition of “private flood insurance” to satisfy the FDPA's general mandatory purchase requirement. The Agencies are also soliciting comment on what criteria the Agencies might require for such a policy. Alternatively, the Agencies solicit comment on whether it is appropriate to include a provision in the final rules that specifically requires regulated lending institutions to accept only policies issued by private insurers that meet the statutory definition, and if included, what would be the effect of such a provision on the availability of privately issued flood insurance.
Third, the Agencies' proposal includes new and revised sample notice forms and clauses. Specifically, the proposal amends the current Sample Form of Notice of Special Flood Hazards and Availability of Federal Disaster Relief Assistance, set forth as Appendix A in the Agencies' respective regulations, to add language concerning the availability of private flood insurance coverage (pursuant to the notice requirements under section 100239 of the Act) and the escrow requirement. The proposal also adds an additional sample notice form, Notice of Requirement to Escrow for Outstanding Loans, as Appendix B to assist institutions in complying with the proposal's requirement to inform existing borrowers about the new escrow requirement. An institution would provide this notice for existing loans when neither the Notice of Special Flood Hazards and Availability of Federal Disaster Relief Assistance nor the notice of force-placement is provided. Finally, as Appendix C, the Agencies are proposing a sample clause regarding the new escrow requirement that may be included with the force-placement notice.
Fourth, the proposal would amend the force-placement of flood insurance provisions to clarify that a lender or its servicer has the authority to charge a borrower for the cost of flood insurance coverage commencing on the date on which the borrower's coverage lapsed or became insufficient. The proposal also would stipulate the circumstances under which a lender or its servicer must terminate force-placed flood insurance coverage and refund payments to a borrower. It also sets forth the documentary evidence a lender must accept to confirm that a borrower has obtained an appropriate amount of flood insurance coverage.
Fifth, the Agencies propose needed technical corrections. For example, the Agencies' current flood insurance regulations refer to the “Director” of the FEMA. The correct title for the head of that agency is “Administrator.”
Finally, the OCC and the FDIC propose to integrate their flood insurance regulations for national banks and Federal savings associations and for State non-member banks and State savings associations, respectively. Specifically, the OCC proposes to add language to its flood insurance regulation for national banks, 12 CFR part 22, to make it applicable to both national banks and Federal savings associations, and to remove its regulation for Federal savings associations, 12 CFR part 172. Similarly, the FDIC proposes to add language to 12 CFR part 339, its flood regulation for State non-member banks, to make it applicable to both State non-member banks and State savings associations and to remove its flood regulation for State savings associations, 12 CFR part 391 subpart D. Parts 22, 172, 339, and 391 subpart D, are nearly identical and contain no substantive differences, as they were originally adopted through an interagency rulemaking process.
Section 102(b) of the FDPA (42 U.S.C. 4012a(b)), as amended by the Act, provides that the Agencies (after consultation and coordination with the FFIEC) shall by regulation direct regulated lending institutions not to make, increase, extend, or renew any loan secured by improved real estate or a mobile home located or to be located in an area that has been identified by the Administrator of FEMA as an area having special flood hazards and in which flood insurance has been made available under the NFIP, unless the building or mobile home and any personal property securing such loan is covered for the term of the loan by flood insurance. Thus, section 102(b) of the FDPA grants the Agencies rulemaking authority to implement this mandatory flood insurance purchase requirement as it pertains to regulated lending institutions.
Furthermore, under section 102(b) of the FDPA, as amended by section 100239 of the Act, the Agencies (after consultation and coordination with the FFIEC) must by regulation direct regulated lending institutions to accept private flood insurance as satisfaction of the mandatory flood insurance purchase requirement, described above. Section 102(b) of the FDPA, as amended by section 100239 of the Act, also authorizes the Agencies to implement the definition of private flood insurance under section 102(b) of the FDPA, as amended by the Act, as well as the requirement that the lender disclose to the borrower the availability of flood insurance from private insurance companies.
The OCC, Board, and FDIC have general authority to issue regulations assuring the safety and soundness of depository institutions.
Finally, section 102(d) of the FDPA (42 U.S.C. 4012a(d)), as amended by section 100209 of the Act and Public Law No. 112-281,
Since the Agencies last revised their regulations in 1996, the title of the head of FEMA has changed from “Director” to “Administrator.” In accordance with this change, the Agencies are proposing an amendment to the reference to the head of FEMA in the scope section.
As part of the OCC's and FDIC's consolidation of their flood insurance rules, the OCC and FDIC also are proposing to insert the term “Federal savings association” or “FDIC-supervised institution” where necessary throughout their flood insurance rules.
Second, the OCC proposes to remove the definition of “bank,” which the rule currently defines as meaning a national bank. Instead, the term “bank” is replaced with “national bank” throughout the rule.
The current regulation provides that a regulated lending institution shall not make, increase, extend, or renew any designated loan unless the building or mobile home and any personal property securing the loan is covered by flood insurance for the term of the loan. This provision further provides that flood insurance coverage is limited to the overall value of the property securing the designated loan minus the value of the land on which the property is located. A “designated loan” means a loan secured by a building or mobile home that is located or to be located in a special flood hazard area in which flood insurance is available under the 1968 Act, as amended.
The Agencies also are proposing to amend this section to implement section 102(b)(1)(B) of the FDPA, as added by section 100239(a)(1) of the Act, which requires that all regulated lending institutions accept private flood insurance if certain conditions are met. Specifically, the proposal would require a regulated lending institution to accept private flood insurance that meets the definition of this term to satisfy the FDPA's insurance requirement, provided that the private flood insurance policy also meets the conditions set forth in the general mandatory purchase requirement. Therefore, a regulated lending institution may only accept private flood insurance coverage under this provision if the building or mobile home and any personal property that secures the mortgage loan is covered for the term of that loan by the amount of flood insurance required by section 102(b)(1)(A) of the FDPA. As described above in
The Agencies understand that there have been concerns regarding the ability of regulated lending institutions to evaluate whether a flood insurance policy meets the definition of “private flood insurance” set forth in the Act because some regulated lending institutions lack the necessary technical expertise. To facilitate compliance in this regard, the Agencies are proposing a safe harbor to allow lenders to rely on the expertise of State insurance regulators. Under the proposed safe harbor, if a State insurance regulator makes a written determination that a flood insurance policy issued by a private insurer meets the definition of “private flood insurance” set forth in the Act, then the Agencies will deem such policy to meet the statutory definition of “private flood insurance.”
The Agencies note that regulating insurance providers is generally the domain of State insurance regulators. As a result, State insurance regulators may be the appropriate parties to determine whether a flood insurance policy meets all the criteria set forth in the statutory definition of “private flood insurance.” The Agencies solicit comment on whether: (i) Any mechanism exists or may be developed by State regulators to make such a determination; (ii) a written determination would facilitate lenders' acceptance of flood insurance by private insurers; (iii) such a safe harbor would alleviate the concerns of regulated lending institutions in evaluating private flood policies; and (iv) a safe harbor would enable the growth of the private flood insurance market.
Although section 102(b)(1)(B) of the FDPA, as added by section 100239(a)(1) of the Act, requires a regulated lending institution to accept private flood insurance that meets the statutory definition, the Agencies note that the statute is silent about whether a regulated lending institution may accept a flood insurance policy issued by a private insurer that does not meet the statutory definition. The Agencies believe that the Congressional intent of the statute was to stimulate the private flood insurance market.
To assist with determining whether the Agencies should include this provision, the Agencies solicit comment on whether policies issued by private insurers that do not meet the statutory definition of “private flood insurance” should be permitted to satisfy the mandatory purchase requirement. Alternatively, the Agencies solicit comment on whether it is appropriate to include a provision in the final rules that specifically requires regulated lending institutions to accept only policies issued by private insurers that meet the statutory definition and, if included, what would be the effect of such a provision on the availability of privately issued flood insurance.
Furthermore, if the Agencies decide to include a provision in the final rules that expressly permits regulated lending institutions, at their discretion, to accept policies issued by private insurers that do not meet the statutory definition of “private flood insurance” to satisfy the mandatory purchase requirement, the Agencies are requesting comment on whether they should require the following criteria for such discretionary policies pursuant to the Agencies' authority to implement the FDPA's general mandatory purchase requirement.
First, State insurance regulators, as the functional regulator of insurance companies, may be in the best position to evaluate the condition and ability of a private insurer to issue a flood insurance policy. Accordingly, the Agencies could require that flood insurance issued by a private insurer that a regulated lending institution may accept at its discretion must be issued by an insurer that is licensed, admitted, or otherwise approved to engage in the business of insurance in the State or jurisdiction in which the insured building is located by the insurance regulator of the State. Further, in the case of a policy of difference in condition, multiple peril, all risk, or other blanket coverage insuring nonresidential commercial property, the Agencies could require that the private insurance provider must be recognized, or not disapproved, as a surplus lines insurer by the insurance regulator of the State or jurisdiction where the property to be insured is located.
Second, the Agencies could require that the coverage provided under any flood insurance policy issued by a private insurer that a regulated lending institution accepts at its discretion must be at least as broad as the coverage provided by a SFIP under the NFIP, including when considering deductibles, exclusions, and conditions offered by the insurer. For example, the private flood insurance policy must provide coverage for the foundation of a building in addition to the above-ground portion of the building. This criterion could ensure that a private flood insurance policy accepted by a regulated lending institution provides the institution and the borrower with appropriate and sufficient coverage for the property securing the loan.
Finally, the Agencies could require that any flood insurance policy issued by a private insurer that a regulated lending institution accepts at its discretion must include a mortgage interest clause similar to the clause contained in a SFIP.
The Agencies solicit comment as to whether requiring the above criteria for any flood insurance policy issued by a private insurer that a lender accepts at its discretion would be inconsistent with State legal requirements and industry practice with respect to private flood insurance. The Agencies also solicit comment as to whether criteria, additional to those discussed above, should be imposed if the Agencies permit regulated lending institutions to accept a private flood insurance policy issued by a private insurer that does not meet the statutory definition of “private flood insurance.”
Regulated lending institutions have previously relied upon FEMA's “Mandatory Purchase of Flood Insurance Guidelines” (Guidelines) for guidance when determining whether a private insurance policy conforms to the flood insurance requirements. FEMA had advised that, to the extent that the private policy differs from the NFIP's policy, the differences should be carefully examined before accepting the policy. On February 4, 2013, FEMA rescinded the Guidelines and advised lenders to “consult their respective regulatory agency for information regarding compliance with the mandatory purchase requirements.”
The Agencies are proposing a technical amendment to change the reference to the head of FEMA from Director to Administrator.
Pursuant to section 102(d) of the FDPA, as amended by section 100209(a) of the Act and Public Law 112-281,
The Agencies are proposing to implement amended section 102(d) of the FDPA with some clarifications. First, as noted above, Public Law 112-281 amended section 102(d) of the FDPA, as amended by section 100209 of the Act, to insert the word “residential” prior to every mention of “improved real estate.” The Agencies' understand that Congress's intent was to apply the escrow requirement to residential loans and exclude commercial loans.
Second, the Agencies are proposing that when a regulated lending institution has determined that a borrower has obtained flood insurance coverage that meets the mandatory purchase requirement for the residential improved real estate or mobile home securing the loan and is currently paying premiums and fees into an escrow account that has been established by another lender, the institution need not establish another escrow account for the same purpose. Such circumstances may arise, for example, when the regulated lending institution takes a second lien position on a particular property and the borrower is already paying flood insurance premiums and fees on such
Third, the Agencies recognize that when flood insurance coverage for a residential improved real estate or a mobile home is provided by a policy purchased by a common interest community, such as a condominium owners' association, the borrower is not the purchaser of the policy. If that policy is purchased by a common interest community in an amount that is sufficient to meet the mandatory flood insurance purchase requirement, then escrowing flood insurance premiums and fees on behalf of the borrower would not be necessary because the borrower would not be directly responsible for paying the flood insurance premiums or fees. As a result, the Agencies are proposing that a regulated lending institution need not establish an escrow account for flood insurance premiums and fees when the institution has determined that flood insurance coverage is provided by a policy purchased by a common interest community instead of the borrower, such as an NFIP Residential Condominium Building Association Policy (RCBAP), that meets the mandatory flood insurance purchase requirement, including coverage for the proper amount. If the amount of the policy purchased by a common interest community is insufficient to meet the mandatory flood insurance purchase requirement, however, the borrower would be required to obtain a supplemental policy to cover the deficiency, and the proposed rule would require that the regulated lending institution escrow the premiums and fees for the supplemental policy. For example, if a condominium owners' association purchases an RCBAP or a private flood insurance policy for less than the maximum amount of insurance available under the NFIP, the borrower may be required to obtain a dwelling policy for supplemental coverage. If the borrower is required to obtain a dwelling policy, the proposed rule would require the regulated lending institution to escrow the premiums and fees for such policy.
The Agencies' proposal sets forth timing provisions that stipulate when regulated lending institutions must begin escrowing premiums and fees for required flood insurance. Section 100209(b) of the Act (42 U.S.C. 4012a note) provides that the escrow provisions apply to any mortgage outstanding or entered into on or after the expiration of the two-year period beginning on the date of enactment of the Act. Therefore, loans secured by residential improved real estate or a mobile home that are outstanding or entered into on or after July 6, 2014 are covered by this requirement, provided the loan is required to have flood insurance. Consequently, the Agencies propose that for any designated loans made on or after July 6, 2014, the regulated lending institution must begin escrowing upon loan consummation.
With respect to designated loans that are outstanding on July 6, 2014, the proposed rule would require regulated lending institutions to begin escrowing with the first loan payment after the first renewal date of the borrower's flood insurance policy that occurs on or after July 6, 2014. For example, if a borrower's current flood insurance policy will renew on March 15, 2015, and the borrower's loan payments are generally due the first of each month, the institution must begin escrowing with the loan payment due on April 1, 2015. The borrower would be responsible for paying the premium to renew the policy on March 15, 2015, however. Payments that are escrowed beginning April 1, 2015 will be used by the lender to pay the premiums for subsequent years.
The Agencies' proposal is intended to alleviate the potential burden to lenders and borrowers of establishing an escrow account for an outstanding loan for which a borrower was not previously escrowing flood insurance premiums and fees. By tying the establishment of the escrow to the time of flood insurance policy renewal, the proposal would allow regulated lending institutions to comply with the requirement on a staggered basis, rather than requiring them to establish escrow accounts for all outstanding designated loans at one time.
The Agencies believe this proposal will also benefit borrowers. Delaying the establishment of the escrow until immediately after their flood insurance policy is renewed will ensure that all borrowers will have the maximum amount of time to escrow for their subsequent flood insurance policy renewal. If the Agencies were to require regulated lending institutions to establish escrow accounts for all outstanding designated loans at one time, some borrowers may be burdened with larger escrow payments to cover the premium for the full term over a shorter period of time than other borrowers. For example, if the Agencies required all regulated lending institutions to establish escrow accounts for all outstanding loans on July 6, 2014, then a borrower whose yearly flood insurance policy renewal date is September 15, 2014, would have only approximately two months to escrow for a full year of flood insurance premiums and fees while a borrower whose yearly flood insurance policy renewal date is March 15, 2015, would have approximately eight months to escrow for a full year of flood insurance premiums and fees. Consequently, the borrower with the March 15, 2015, renewal date would have smaller escrow payments each payment period than the borrower with the September 15, 2014 renewal date. Requiring regulated lending institutions to begin escrowing with the first loan payment after the borrower renews the existing policy would mean that all borrowers will have the maximum amount of time to escrow for the next flood insurance payment, regardless of when their policies renew.
The Agencies request comment on the timing proposed for complying with the escrow requirement for outstanding loans and whether regulated lending institutions should be provided the option of complying with the escrow requirement earlier than the dates set forth in the proposal. Lenders with a small number of designated loans that are not otherwise excepted from the escrow requirement may prefer to establish all required escrow accounts for outstanding designated loans in their portfolio at one time, prior to the insurance policy renewal dates. Permitting institutions to comply with the escrow requirement earlier, however, may mean that some
The Agencies are also proposing to address the timing applicable to loans that were not designated loans at the time that they were made, but become designated loans after July 6, 2014. This may occur, for example, when there is a FEMA map change, and a building that was not previously located in an SFHA is now located in an SFHA. In those instances, the loan secured by such building may be required to have flood insurance under the FDPA. If flood insurance is required, a regulated lending institution, or a servicer acting on its behalf, also would be required to establish an escrow account to comply with the FDPA, as amended by the Act. The proposed rule would require regulated lending institutions to begin escrowing premiums and fees for required flood insurance with the first loan payment after the flood insurance policy is established. Under the proposal, this initial flood insurance policy may either be purchased by the borrower or, if the borrower failed to purchase a policy, force-placed by the regulated lending institution.
The following explanation illustrates how this provision would operate. Under the Agencies' proposal, in the situation in which a lender determines that a loan that was not originally a designated loan, but has become a designated loan, for example, due to remapping, the lender would notify the borrower that flood insurance is required, as provided in the force-placement provision of the rule. After the required notification, either the borrower would purchase and pay for a flood insurance policy or the lender would force-place a policy and charge the borrower for the cost of coverage. The lender also would commence escrowing payments to cover premiums and fees, which would be applied to the next annual policy renewal, upon the borrower's next loan payment.
The Agencies solicit comment on whether the requirement to begin escrowing for a loan that becomes a designated loan after July 6, 2014, should be limited only to when a borrower-purchased flood insurance policy is established and exclude instances in which a lender-placed flood insurance policy is established. If the rule were to be limited only to when a borrower-purchased flood insurance is established, a regulated lending institution would not be required to escrow flood insurance premiums and fees when it force-places an initial flood insurance policy. In this instance, after the expiration of such a force-placed insurance policy, there would be no funds escrowed for any policy that may be purchased at that time, whether it is borrower-purchased or lender-placed. Under the proposed rule, a regulated lending institution would be required to escrow flood insurance premiums and fees following the establishment of a force-placed policy for a loan that becomes a designated loan after July 6, 2014. If a borrower fails to purchase the requisite flood insurance upon the expiration of such force-placed insurance, then the lender would use the escrowed funds to renew or purchase a new force-placed policy.
In order to ensure that borrowers are well-informed about the escrow requirement to collect premiums and fees for required flood insurance, the Agencies are proposing that regulated lending institutions provide borrowers with a written notice. Specifically, the proposed rule would mandate that a regulated lending institution, or a servicer acting on its behalf, mail or deliver a written notice informing a borrower that it is required to escrow all premiums and fees for required flood insurance on residential improved real estate. In order to facilitate compliance with the proposed notice requirement, the Agencies are proposing model language for this notice as discussed in more detail below in the
However, for loans that are outstanding on July 6, 2014, there are no required notices under current law that the regulated lending institution would be certain to provide before the institution would be required to begin escrowing under the proposal. Consequently, the Agencies are proposing that a regulated lending institution, or a servicer acting on its behalf, provide a separate notice describing the escrow requirement, substantially similar to the sample notice proposed by the Agencies in Appendix B, at least 90 days before the regulated lending institution must begin escrowing. The Agencies believe that 90 days' advance notice would give borrowers sufficient time to gather the necessary funds for the escrow. However, the Agencies solicit comment on whether 90 days is an appropriate time period to provide notice for loans outstanding on July 6, 2014.
This proposal implements the statutory exception to the escrow requirement substantially as included in the Act with some clarifications. The statute states that, except as provided by State law, regulated lending institutions that have total assets of less than $1 billion are exempt from this escrow requirement if, on or before July 6, 2012, the institution: (i) in the case of a loan secured by residential improved real estate or a mobile home, was not required under Federal or State law to deposit taxes, insurance premiums, fees, or any other charges in an escrow account for the entire term of the loan; and (ii) did not have a policy of consistently and uniformly requiring the deposit of taxes, insurance premiums, fees, or any other charges in an escrow account for loans secured by residential improved real estate or a mobile home.
Because the Act does not specify a point in time to measure the asset size of an institution to determine whether such institution qualifies for the
This measurement method is similar to how the OCC, the Board, and the FDIC have measured asset size in relation to the definitions for small entities under the Community Reinvestment Act (CRA).
Moreover, the Agencies are proposing transition rules for a change in status of a regulated lending institution that may initially qualify for the exception, but later grows to exceed the $1 billion asset size threshold. Similar to the Board's Regulation II, the Agencies propose to give regulated lending institutions approximately six months to begin complying with the escrow requirement.
For example, assume a regulated lending institution qualified for the exception in 2014, but had assets of $1 billion or more as of December 31, 2014, and December 31, 2015. In that case, 2016 would be the succeeding calendar year. Under the proposal, such regulated lending institution would be required to begin escrowing with the first loan payment on or after the first renewal date of the borrower's flood insurance policy on or after July 1, 2016, for any loan outstanding on July 1, 2016. For any designated loan made after July 1, 2016, the proposal would require such institution to begin escrowing upon loan consummation. For any loan that becomes a designated loan after July 1, 2016, the proposal would require such institution to begin escrowing with the first loan payment after the flood insurance policy is established.
In addition, the Agencies are proposing the same notice obligation for regulated lending institutions after a change in status with similar timing requirements as would apply to other regulated lending institutions that are subject to the escrow requirement. As a result, for loans that are outstanding on July 1 of the succeeding calendar year after a regulated lending institution has a change in status, the proposal would require a regulated lending institution to provide notice on the escrow requirement at least 90 days before the regulated lending institution must begin escrowing, using language that is substantially similar to the language provided in Appendix B. For designated loans that are made on or after July 1 of the succeeding calendar year after a regulated lending institution has a change in status, the Agencies propose that notice concerning the escrow requirement be provided with the notice of special flood hazards, using language that is substantially similar to the escrow requirement language provided in the sample form of notice contained in Appendix A. Finally, for a loan that becomes a designated loan after July 1 of the succeeding calendar year after a regulated lending institution has a change in status, notice concerning the escrow requirement would be provided with the force-placement notice under the proposal, using language substantially similar to the sample language provided in Appendix C.
The Agencies also are proposing a provision to address situations in which a regulated lending institution that is required to comply with the escrow requirement acquires a designated loan that is covered by FDPA-required flood insurance that becomes subject to the escrow requirement as a result of the acquisition. For example, this may occur if a lender that qualifies for the statutory exception sells the loan to or merges with a regulated lending institution that must comply with the escrow requirement. In these cases, the Agencies are proposing that the regulated lending institution must begin escrowing premiums and fees for flood insurance with the first loan payment on or after the first renewal date of the borrower's flood insurance policy on or after the date that is six months from the transfer date of the loan. For instance, suppose a regulated lending institution that is required to comply with the escrow requirement purchases loans from an institution that is not subject to the escrow requirement, and the transfer date for the loans is February 1, 2015. Under the proposal, for any designated loan that is transferred on February 1, 2015, the regulated lending institution that acquires the loan must begin escrowing premiums and fees for flood insurance with the first loan payment on or after the first renewal date of the borrower's flood insurance policy on or after August 1, 2015.
This proposed timing is similar to the timing the Agencies have proposed for regulated lending institutions that no longer qualify for the statutory exception. Furthermore, as with the notice requirement proposed for other outstanding designated loans, the Agencies are proposing that a regulated lending institution provide notice at least 90 days before the institution must begin to escrow for a designated loan that becomes subject to the escrow requirement as a result of a change in loan ownership.
The Agencies are proposing technical amendments in this section to change the reference to the head of FEMA from Director to Administrator and to update how a lending institution may obtain the standard flood hazard insurance form by directing the institution to FEMA's Web site.
Pursuant to section 102(e) of the FDPA, as amended by section 100244 of the Act, the Agencies are proposing to amend their rules for the force-placement of flood insurance.
Under current regulations, if a regulated lending institution, or a servicer acting on its behalf, determines at any time during the term of a designated loan that the building or mobile home and any personal property securing the designated loan is not covered by flood insurance or is covered by flood insurance in an amount less than the amount required under the FDPA, then the regulated lending institution or its servicer must notify the borrower that the borrower should obtain flood insurance, at the borrower's expense, in an amount at least equal to the amount required under the mandatory purchase requirements, for the remaining term of the designated loan. If the borrower fails to obtain adequate flood insurance within 45 days after notification, then the regulated lending institution or its servicer must purchase flood insurance on behalf of the borrower. The regulated lending institution or servicer may charge the borrower for the cost of the premiums and fees incurred in purchasing the insurance. Pursuant to section 102(e) of the FDPA, as amended by section 100244 of the Act, the Agencies propose to amend their regulations to provide that the regulated lending institution or its servicer may charge the borrower for the cost of premiums and fees incurred for coverage beginning on the date on which flood insurance coverage lapsed or did not provide a sufficient coverage amount. The Agencies' understanding is that the date on which the flood insurance coverage lapsed is the expiration date provided in the policy. The Agencies seek comment on whether the Agencies' interpretation of the term “lapsed” is consistent with the insurance industry's use of the term and as to whether further clarification is necessary on when a lender or servicer may begin to charge for force-placed flood insurance.
For purposes of safety and soundness, regulated lending institutions should monitor the continuous coverage of flood insurance for the building or mobile home and any personal property securing a designated loan. Additionally, the Agencies interpret the Act to permit a regulated lending institution to force-place a flood insurance policy purchased on behalf of a borrower that is effective the day after expiration of a borrower's original insurance policy to ensure that it is continuous. Such a practice will ensure that institutions complete the force-placement of flood insurance in a timely manner upon lapse of the policy and that there is continuous insurance coverage to protect both the borrower and the institution.
As provided in section 102(e)(3) of the FDPA, as added by section 100244 of the Act, the Agencies propose that within 30 days of receipt by a regulated lending institution, or a servicer acting on its behalf, of a confirmation of a borrower's existing flood insurance coverage, a regulated lending institution is required to: (i) Notify the insurer to terminate any force-placed insurance purchased by the regulated lending institution or its servicer; and (ii) refund to the borrower all premiums paid by the borrower for any insurance purchased by the regulated lending institution or its servicer under this section for any period during which the borrower's flood insurance coverage and the insurance coverage purchased by the regulated lending institution or its servicer were each in effect (overlap period), and any related fees charged to the borrower with respect to the insurance purchased by the regulated lending institution or its servicer during such overlap period.
The Agencies realize that, although regulated lending institutions and servicers can request that a force-placed insurance policy be terminated, the insurer is the party that actually cancels the policy. The Agencies' proposal therefore clarifies the statutory language in section 102(e)(3) of the FDPA, as amended by section 100244 of the Act, to require the institution only to notify the insurer to terminate the force-placed policy and to fully refund to the borrower the premiums and fees for the overlap period within the 30-day period required by the statute.
In addition, the Agencies note that section 102(e)(3) of the FDPA, as amended, and the Agencies' proposed regulations, do not specify a party from which a regulated lending institution must receive confirmation of a borrower's existing flood insurance coverage. Therefore, regulated lending institutions may receive the confirmation from either the borrower or a third party, such as an insurance agent or insurer with whom the institution has direct contact.
Pursuant to section 102(e)(4) of the FDPA, as amended by section 100244 of the Act, the Agencies propose that for the purposes of confirming a borrower's existing flood insurance coverage, a regulated lending institution or its servicer must accept from the borrower an insurance policy declarations page that includes the existing flood insurance policy number and the identity of, and contact information for, the insurance company or its agent, as confirmation of the existence of coverage. A lender is responsible for making all necessary inquiries into the adequacy of the borrower's insurance policy to ensure the policy complies with the mandatory purchase requirement. If the lender determines the coverage amount or any terms and conditions fail to meet applicable requirements, the lender should notify the borrower and request the borrower to obtain an adequate flood insurance policy.
The Agencies are proposing technical amendments in this section to change the references to the head of FEMA from Director to Administrator.
Section 100239 of the Act adds a new section 102(b)(6) to the FDPA (42 U.S.C. 4012a(b)(6)) requiring regulated lending institutions to disclose to a borrower that: (i) Flood insurance is available from private insurance companies that issue SFIPs on behalf of the NFIP or directly from the NFIP; (ii) flood insurance that provides the same level of coverage as an SFIP under the NFIP may be available from a private insurance company that issues policies on behalf of the company; and (iii) the borrower is encouraged to compare the flood insurance coverage, deductibles, exclusions, conditions, and premiums associated with flood insurance policies
The Agencies are proposing technical amendments in this section to change the references to the head of FEMA from Director to Administrator.
As noted above in the
In addition, as discussed in the
The OCC currently supervises approximately 1,257 small national banks, Federal savings associations, trust companies, and branches or agencies of foreign banks.
1.
The proposal also would implement the Act's requirement that regulated lending institutions accept any private insurance policy that meets the Act's definition of “private flood insurance” in satisfaction of the mandatory purchase requirement. The proposed
The Act also includes provisions related to the force placement of flood insurance, which the proposal would implement. These provisions clarify that regulated lending institutions may charge a borrower for the cost of premiums and fees incurred in the purchase of force-placed flood insurance from the date coverage lapsed or did not provide a sufficient amount of coverage. The provisions also provide that within 30 days of receipt of a confirmation of a borrower's existing flood insurance coverage, a regulated lending institution is required to terminate any force-placed insurance purchased by the regulated lending institution, and refund to the borrower all premiums paid by the borrower for lender-placed coverage for any period during which the borrower's flood insurance coverage and the lender-place coverage overlapped.
2.
As discussed in detail above in the
With respect to the proposed rules regarding the acceptance of private flood insurance, the Board believes the rules will not have a significant impact on small entities because regulated lending institutions, including those that are considered small entities, currently are permitted to accept private flood insurance policies. Moreover, as discussed in the
3.
4.
It is the opinion of the FDIC that the proposed rule will not have a significant economic impact on a substantial number of the small entities, which the FDIC supervises. The FDIC reaches this conclusion in reliance upon the fact that the only requirements that the Act requires the Agencies to impose upon supervised entities as a matter of regulation are the escrow requirement and the requirement to accept private flood insurance. The Act provides that generally a depository institution with assets of less than $1 billion is not required to comply with the escrow requirement. As a result, due to this statutory exclusion, by law the escrow requirement cannot have a significant economic impact on a substantial number of small entities. The requirement to accept private flood insurance also cannot have a significant economic impact on a substantial number of small entities since depository institutions were permitted to accept private flood insurance for NFIP purposes even before the Act's amendments. For these reasons, the FDIC certifies that this proposed rule will not have a significant economic impact on a substantial number of small entities that it supervises.
Pursuant to section 605(b) of the RFA, the FCA hereby certifies that the proposed rule will not have a significant economic impact on a substantial number of small entities. Each of the banks in the Farm Credit System, considered together with its affiliated associations, has assets and annual income in excess of the amounts that would qualify them as small entities. Therefore, Farm Credit System institutions are not “small entities” as defined in the RFA.
The RFA requires NCUA to prepare an analysis to describe any significant economic impact a regulation may have on a substantial number of small entities.
Under this proposed rule, credit unions with total assets less than $1 billion would generally be exempt from the escrow provisions. Therefore, the escrow provisions of the proposed rule would not affect small credit unions. For private flood insurance, NCUA does not believe the proposed rule will have a significant impact on small credit unions since credit unions are currently allowed to accept private flood insurance. In addition, the proposed rule provides a safe harbor for regulated lending institutions (which includes credit unions), including small entities, for evaluating whether a flood insurance policy issued by a private insurer meets the definition of “private flood insurance”. Lastly, the force placement provisions in the proposed rule were effective on July 6, 2012, and credit unions have been enforcing force placement provisions already. In addition, credit unions currently have the tools to refund premiums and fees whenever a borrower's policy overlaps a force-placed policy, as required in the proposed rule.
NCUA finds that this proposed rule would affect relatively few federally insured, small credit unions and the associated cost is minimal. Accordingly, NCUA certifies the rule will not have a significant economic impact on small entities.
Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) (2 U.S.C. 1501
The OCC has estimated that the total cost associated with this NPRM, if implemented, would be approximately $72 million and the average cost per institution would be $55,000. However, pursuant to section 201 of the UMRA, a regulation does not impose a mandate to the extent it incorporates requirements “specifically set forth in the law.” Therefore, we exclude from our UMRA estimate costs specifically related to requirements set forth in the Act, such as costs related to establishing escrow accounts, amendments to the force placement provisions, and the acceptance of private flood insurance policies. Furthermore, under Title II of the UMRA, indirect costs, foregone revenues and opportunity costs are not included when determining if a mandate meets or exceeds UMRA's cost threshold. Therefore, based on these exclusions, our UMRA cost estimate for the NPRM, if implemented, is zero.
Accordingly, because the OCC has determined that this proposed rule would not result in expenditures by State, local, and tribal governments, or by the private sector, of $100 million or more, we have not prepared a budgetary impact statement or specifically addressed the regulatory alternatives considered.
The OCC, Board, FDIC, and NCUA (the Agencies)
In accordance with the PRA (44 U.S.C. 3506; 5 CFR 1320 Appendix A.1), the Board reviewed the proposed rule under the authority delegated to the Board by the Office of Management and Budget (OMB). The collection of information that is subject to the PRA by this proposed rule is found in 12 CFR 22.5, 208.25(e), 339.5, and 760.5. In addition, as permitted by the PRA, the OCC, Board, and FDIC also propose to extend for three years their respective information collections.
The Agencies may not conduct or sponsor, and an organization is not required to respond to, this information collection unless the information collection displays a currently valid OMB control number. The OMB control numbers are 1557-0202 (OCC), 7100-0280 (Board), and 3064-0120 (FDIC).
The proposed rule adds a notice requirement stating that institutions or services that are required to escrow all premiums and fees for required flood insurance must issue a written notice to the borrower.
This information collection is required to evidence compliance with the requirements of the Federal flood insurance statutes with respect to lenders and servicers. Because the Agencies do not collect any information, no issue of confidentiality arises. The respondents are for-profit and non-profit financial institutions, including small businesses.
Entities subject to the Agencies' existing flood insurance rules will have to review and revise disclosures that are currently provided to ensure that such disclosures accurately reflect the disclosure requirements in this proposed rule. Entities subject to the rule may also need to develop new disclosures to meet the proposed rule's timing requirements.
The total estimated burden increase, as well as the estimates of the burden increase associated with each major section of the proposed rule as set forth below, represents averages for all respondents regulated by the Agencies. The Agencies expect that the amount of time required to implement each of the proposed changes for a given institution may vary based on the size and complexity of the respondent.
The Agencies estimate that respondents would take, on average, 40 hours to update their systems in order to comply with the disclosure requirements and the one-time escrow notice under the proposed rule. In an effort to minimize the compliance cost and burden, particularly for small entities that do not meet the requirement for the statutory exception, the proposed rule contains model disclosures in appendices A, B, and C that may be used to satisfy the requirements.
Number of Respondents: 1,316.
Burden for Existing Recordkeeping Requirements: 196,907 hours.
Burden for Existing Disclosure Requirements: 244,208 hours.
Burden for Proposed Rule: 52,640 hours.
Total Burden for Collection: 493,755 hours.
Number of Respondents: 843.
Burden for Existing Recordkeeping Requirements: 14,191 hours.
Burden for Existing Disclosure Requirements: 17,632 hours.
Burden for Proposed Rule: 33,720 hours.
Total Burden for Collection: 65,543 hours.
Number of Respondents: 4,421.
Burden for Existing Recordkeeping Requirements: 61,894 hours.
Burden for Existing Disclosure Requirements: 76,999 hours.
Burden for Proposed Rule: 176,840 hours.
Total Burden for Collection: 315,733 hours.
Number of Respondents: 4,192.
Burden for Existing Recordkeeping Requirements: 57,230.85 hours.
Burden for Existing Disclosure Requirements: 70,966.26 hours.
Burden for Proposed Rule: 8,240 hours.
Total Burden for Collection: 136,437.11 hours.
These collections are available to the public at
Comments are invited on: (1) Whether the proposed collection of information is necessary for the proper performance of the Agencies' functions; including whether the information has practical utility; (2) the accuracy of the Agencies' estimate of the burden of the proposed information collection, including the cost of compliance; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of information collection on respondents, including through the use of automated collection techniques or other forms of information technology.
Comments on the collection of information should be sent to:
All comments received, including attachments and other supporting materials, are part of the public record and subject to public disclosure. Do not enclose any information in your comment or supporting materials that you consider confidential or inappropriate for public disclosure.
•
•
•
•
•
Additionally, commenters may send a copy of their comments to the OMB desk officer for the agencies by mail to the Office of Information and Regulatory Affairs, U.S. Office of Management and Budget, New Executive Office Building, Room 10235, 725 17th Street NW., Washington, DC 20503; by fax to (202) 395-6974; or by email to
Flood insurance, Mortgages, National banks, Reporting and recordkeeping requirements, Savings associations.
Flood insurance, Reporting and recordkeeping requirements, Savings associations.
Accounting, Agriculture, Banks, banking, Confidential business information, Crime, Currency, Federal Reserve System, Flood insurance, Mortgages, Reporting and recordkeeping requirements, Securities.
Flood insurance, Reporting and recordkeeping requirements, Savings associations.
Flood insurance, Reporting and recordkeeping requirements, Savings associations.
Agriculture, Banks, banking, Flood insurance, Foreign trade, Reporting and recordkeeping requirements, Rural areas.
Credit unions, Mortgages, Flood insurance, Reporting and recordkeeping requirements.
For the reasons set forth in the joint preamble and under the authority of 12 U.S.C. 93a and 5412(b)(2)(B), the OCC proposes to amend Part 12 Chapter I as follows:
12 U.S.C. 93a, 1462a, 1463, 1464, and 5412(b)(2)(B); 42 U.S.C. 4012a, 4104a, 4104b, 4106, and 4128.
(a)
(b)
For the purposes of this part:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(1) Is issued by an insurance company that is:
(i) Licensed, admitted, or otherwise approved to engage in the business of insurance in the State or jurisdiction which the insured building is located, by the insurance regulator of that State or jurisdiction; or
(ii) Recognized, or not disapproved, as a surplus lines insurer by the insurance regulator of the State or jurisdiction where the property to be insured is located in the case of a policy of difference in conditions, multiple peril, all risk, or other blanket coverage;
(2) Provides flood insurance coverage which is at least as broad as the coverage provided under a standard flood insurance policy under the NFIP, including when considering deductibles, exclusions, and conditions offered by the insurer;
(3) Includes all of the following:
(i) A requirement for the insurer to give 45 days' written notice of cancellation or non-renewal of flood insurance coverage to:
(
(
(ii) Information about the availability of flood insurance coverage under the NFIP;
(iii) A mortgage interest clause similar to the clause contained in the standard flood insurance policy under the NFIP; and
(iv) A provision requiring an insured to file suit not later than one year after the date of a written denial of all or part of a claim under the policy; and
(4) Contains cancellation provisions that are as restrictive as the provisions contained in a standard flood insurance policy under the NFIP.
(i)
(j)
(k)
(1) Receiving any scheduled, periodic payments from a borrower under the terms of a loan, including amounts for taxes, insurance premiums, and other charges with respect to the property securing the loan; and
(2) Making payments of principal and interest and any other payments from the amounts received from the borrower as may be required under the terms of the loan.
(l)
(m)
(a)
(b)
(c)
(2)
The flood insurance requirement prescribed by § 22.3 does not apply with respect to:
(a) Any State-owned property covered under a policy of self-insurance satisfactory to the Administrator of FEMA, who publishes and periodically revises the list of States falling within this exemption; or
(b) Property securing any loan with an original principal balance of $5,000 or less and a repayment term of one year or less.
(a)
(i) The loan is an extension of credit primarily for business, commercial, or agricultural purposes;
(ii) The borrower has obtained flood insurance coverage that meets the requirements of § 22.3(a) for the residential improved real estate or mobile home securing the loan and is currently paying premiums and fees through an escrow account established by another lender; or
(iii) Flood insurance coverage for the residential improved real estate or mobile home is provided by a policy that is purchased by a common interest community instead of the borrower, such as an NFIP Residential Condominium Building Association Policy (RCBAP), that meets the requirements of § 22.3(a).
(2)
(i) For any designated loan outstanding on July 6, 2014, with the first loan payment on or after the first renewal date of the borrower's flood insurance policy on or after July 6, 2014;
(ii) For any designated loan made on or after July 6, 2014, upon loan consummation; or
(iii) For any loan that becomes a designated loan after July 6, 2014, with the first loan payment after the flood insurance policy is established.
(3)
(b)
(1) For loans subject to paragraphs (a)(2)(i), (c)(2)(i), or (d) of this section, at least 90 days before the escrow of premiums and fees under paragraphs (a)(2)(i), (c)(2)(i), or (d), using language that is substantially similar to the model form in appendix B;
(2) For loans subject to paragraphs (a)(2)(ii) or (c)(2)(ii) of this section, with the notice provided under § 22.9, using language that is substantially similar to model clauses on the escrow requirement in appendix A; or
(3) For loans subject to paragraphs (a)(2)(iii) or (c)(2)(iii) of this section, with the notice provided under § 22.7, using language that is substantially similar to model clauses on the escrow requirement in appendix C.
(c)
(i) That has total assets of less than $1 billion as of December 31 of either of the two prior calendar years; and
(ii) On or before July 6, 2012:
(A) Was not required under Federal or State law to deposit taxes, insurance premiums, fees, or any other charges in an escrow account for the entire term of a loan secured by residential improved real estate or a mobile home; and
(B) Did not have a policy of consistently and uniformly requiring the deposit of taxes, insurance premiums, fees, or any other charges in an escrow account for loans secured by residential improved real estate or a mobile home.
(2)
(i) For any designated loan outstanding on July 1 of the succeeding calendar year, with the first loan payment on or after the first renewal date of the borrower's flood insurance policy on or after July 1 of the succeeding calendar year;
(ii) For any designated loan made on or after July 1 of the succeeding calendar year, upon loan consummation; or
(iii) For any loan that becomes a designated loan after July 1 of the succeeding calendar year, with the first loan payment after the flood insurance policy is established.
(d)
(a)
(b)
(a)
(b)
(i) Notify the insurance provider to terminate any insurance purchased by the national bank or Federal savings association or its servicer under paragraph (a) of this section; and
(ii) Refund to the borrower all premiums paid by the borrower for any insurance purchased by the national bank or Federal savings association or its servicer under paragraph (a) of this section during any period during which the borrower's flood insurance coverage and the insurance coverage purchased by the national bank or Federal savings association or its servicer were each in effect, and any related fees charged to the borrower with respect to the insurance purchased by the national bank or Federal savings association or its servicer during such period.
(2)
(a)
(b)
(1) Is made in connection with a making, increasing, extending, or renewing of the loan that is initiated by the borrower;
(2) Reflects the Administrator of FEMA's revision or updating of flood plain areas or flood-risk zones;
(3) Reflects the Administrator of FEMA's publication of a notice or compendium that:
(i) Affects the area in which the building or mobile home securing the loan is located;
(ii) By determination of the Administrator of FEMA, may reasonably require a determination whether the building or mobile home securing the loan is located in a special flood hazard area; or
(4) Results in the purchase of flood insurance coverage by the lender, or its servicer, on behalf of the borrower under § 22.7.
(c)
(a)
(b)
(1) A warning, in a form approved by the Administrator of FEMA, that the building or the mobile home is or will be located in a special flood hazard area;
(2) A description of the flood insurance purchase requirements set forth in section 102(b) of the Flood Disaster Protection Act of 1973, as amended (42 U.S.C. 4012a(b));
(3) A statement, where applicable, that flood insurance coverage is available from private insurance companies that issue standard flood insurance policies on behalf of the NFIP or directly from the NFIP;
(4) A statement that flood insurance that provides the same level of coverage as a standard flood insurance policy under the NFIP also may be available from a private insurance company that issues policies on behalf of the company;
(5) A statement that the borrower is encouraged to compare the flood insurance coverage, deductibles, exclusions, conditions and premiums associated with flood insurance policies issued on behalf of the NFIP and policies issued on behalf of private insurance companies and that the borrower should direct inquiries regarding the availability, cost, and comparisons of flood insurance coverage to an insurance agent; and
(6) A statement whether Federal disaster relief assistance may be available in the event of damage to the building or mobile home caused by flooding in a Federally declared disaster.
(c)
(d)
(e)
(f)
(a)
(b)
We are giving you this notice to inform you that:
The building or mobile home securing the loan for which you have applied is or will be located in an area with special flood hazards.
The area has been identified by the Administrator of the Federal Emergency Management Agency (FEMA) as a special flood hazard area using FEMA's
Federal law allows a lender and borrower jointly to request the Administrator of FEMA to review the determination of whether the property securing the loan is located in a special flood hazard area. If you would like to make such a request, please contact us for further information.
_ The community in which the property securing the loan is located participates in the National Flood Insurance Program (NFIP). Federal law will not allow us to make you the loan that you have applied for if you do not purchase flood insurance. The flood insurance must be maintained for the life of the loan. If you fail to purchase or renew flood insurance on the property, Federal law authorizes and requires us to purchase the flood insurance for you at your expense.
• At a minimum, flood insurance purchased must cover
(1) the outstanding principal balance of the loan;
(2) the maximum amount of coverage allowed for the type of property under the NFIP.
Flood insurance coverage under the NFIP is limited to the building or mobile home and any personal property that secures your loan and not the land itself.
• Federal disaster relief assistance (usually in the form of a low-interest loan) may be available for damages incurred in excess of your flood insurance if your community's participation in the NFIP is in accordance with NFIP requirements.
Flood insurance coverage under the NFIP may be purchased through an insurance agent who will obtain the policy either directly through the NFIP or through an insurance company that participates in the NFIP. Flood insurance that provides the same level of coverage as a standard flood insurance policy under the NFIP may be available from private insurers that do not participate in the NFIP. You should compare the flood insurance coverage, deductibles, exclusions, conditions and premiums associated with flood insurance policies issued on behalf of the NFIP and policies issued on behalf of private insurance companies and ask an insurance agent as to the availability, cost, and comparisons of flood insurance coverage.
Federal law requires a lender or its servicer to escrow all premiums and fees for flood insurance that covers any residential building or mobile home securing a loan that is located in an area with special flood hazards. These premiums and fees must be paid to the lender or its servicer with the same frequency as your loan payments for the duration of your loan and will be deposited in an escrow account on your behalf to be paid to the flood insurance provider. Upon receipt of a notice from the flood insurance provider that the premiums are due, the premiums shall be paid from the escrow account to the insurance provider.]
_Flood insurance coverage under the NFIP is not available for the property securing the loan because the community in which the property is located does not participate in the NFIP. In addition, if the non-participating community has been identified for at least one year as containing a special flood hazard area, properties located in the community will not be eligible for Federal disaster relief assistance in the event of a Federally declared flood disaster.
We are giving you this notice to inform you that Federal law requires a lender or its servicer to escrow all premiums and fees for flood insurance that covers the building or mobile home securing your loan(s).
Federal law requires that you pay flood insurance premiums and fees with the same frequency as your loan payments for the duration of your loan. Your payments will be deposited in an escrow account so that when we receive a notice from your flood insurance provider that your flood insurance premiums are due, we will make payment from the escrow account to the insurance provider on your behalf.
When you receive your next flood insurance bill with the renewal of your policy from your flood insurance provider, you are responsible for making that payment directly to your insurance provider.
We will begin collecting the premiums and fees for your flood insurance escrow account with your mortgage loan payment following this renewal date for the next policy term. For example, if your flood insurance policy renewal date is September 15 and your next mortgage loan payment is October 1, the bank will begin collecting the flood insurance premiums and fees for escrow with the October 1 mortgage loan payment.
The escrow amount for flood insurance will be added to your existing periodic mortgage payment. The payments you make into the escrow account will accumulate over time and the funds will be used to pay your flood insurance policy at the next policy renewal date.
Any questions regarding this new escrow requirement should be directed to [Insert Name of Lender or Servicer] at [Insert Contact Information].
Federal law requires a lender or its servicer to escrow all premiums and fees for flood insurance that covers any residential building or mobile home securing a loan that is located in an area with special flood hazards. You must make payments of these premiums and fees to [Insert Name of Lender or Servicer] with the same frequency as your loan payments for the duration of your loan. Your payments will be deposited in an escrow account on your behalf to be paid to the flood insurance provider. Upon receipt of a notice from the flood insurance provider that the flood insurance premium is due, [Insert Name of Lender or Servicer] will pay the premium from the escrow account to the insurance provider.
For the reasons set forth in the joint preamble, part 208 of chapter II of title 12 of the Code of Federal Regulations is proposed to be amended as set forth below:
12 U.S.C. 36, 248(a), 248(c), 321-338a, 371d, 461, 481-486, 601, 611, 1814, 1823(j), 1828(o), 1831o, 1831p-1, 3105, 3310, 3331-3351, and 3906-3909; 15 U.S.C. 78b, 781(b), 781(g), 781(i), 78o-4(c)(5), 78q, 78q-1, and 78w; 31 U.S.C. 5318; 42 U.S.C. 4012a, 4104a, 4104b, 4106, and 4128.
(a)
(2)
(b)
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(i) Is issued by an insurance company that is:
(A) Licensed, admitted, or otherwise approved to engage in the business of insurance in the State or jurisdiction which the insured building is located, by the insurance regulator of that State or jurisdiction; or
(B) Recognized, or not disapproved, as a surplus lines insurer by the insurance regulator of the State or jurisdiction where the property to be insured is located in the case of a policy of difference in conditions, multiple peril, all risk, or other blanket coverage;
(ii) Provides flood insurance coverage which is at least as broad as the coverage provided under a standard flood insurance policy under the NFIP, including when considering deductibles, exclusions, and conditions offered by the insurer;
(iii) Includes all of the following:
(A) A requirement for the insurer to give 45 days' written notice of cancellation or non-renewal of flood insurance coverage to:
(
(
(B) Information about the availability of flood insurance coverage under the NFIP;
(C) A mortgage interest clause similar to the clause contained in the standard flood insurance policy under the NFIP; and
(D) A provision requiring an insured to file suit not later than one year after the date of a written denial of all or part of a claim under the policy; and
(iv) Contains cancellation provisions that are as restrictive as the provisions contained in a standard flood insurance policy under the NFIP.
(9)
(10)
(i) Receiving any scheduled, periodic payments from a borrower under the terms of a loan, including amounts for taxes, insurance premiums, and other charges with respect to the property securing the loan; and
(ii) Making payments of principal and interest and any other payments from the amounts received from the borrower as may be required under the terms of the loan.
(11)
(12)
(c)
(2)
(3)
(ii)
(d)
(1) Any State-owned property covered under a policy of self-insurance satisfactory to the Administrator of FEMA, who publishes and periodically revises the list of States falling within this exemption; or
(2) Property securing any loan with an original principal balance of $5,000 or less and a repayment term of one year or less.
(e)
(A) The loan is an extension of credit primarily for business, commercial, or agricultural purposes; or
(B) The borrower has obtained flood insurance coverage that meets the requirements of paragraph (c)(1) of this section for the residential improved real estate or mobile home securing the loan and is currently paying premiums and fees through an escrow account established by another lender; or
(C) Flood insurance coverage for the residential improved real estate or mobile home is provided by a policy that is purchased by a common interest community instead of the borrower, such as an NFIP Residential Condominium Building Association Policy (RCBAP), that meets the requirements of paragraph (c) of this section.
(ii)
(A) for any designated loan outstanding on July 6, 2014, with the first loan payment on or after the first renewal date of the borrower's flood insurance policy on or after July 6, 2014;
(B) For any designated loan made on or after July 6, 2014, upon loan consummation; or
(C) For any loan that becomes a designated loan after July 6, 2014, with the first loan payment after the flood insurance policy is established.
(iii)
(2)
(i) For loans subject to paragraphs (e)(1)(ii)(A), (e)(3)(ii)(A), or (e)(4) of this section, at least 90 days before the escrow of premiums and fees under paragraphs (e)(1)(ii)(A), (e)(3)(ii)(A), or (e)(4) of this section, using language that is substantially similar to the model form in appendix B; or
(ii) For loans subject to paragraphs (e)(1)(ii)(B) or (e)(3)(ii)(B) of this section, with the notice provided under paragraph (i) of this section, using language that is substantially similar to model clauses on the escrow requirement in appendix A; or
(iii) For loans subject to paragraphs (e)(1)(ii)(C) or (e)(3)(ii)(C) of this section, with the notice provided under paragraph (g) of this section, using language that is substantially similar to model clauses on the escrow requirement in appendix C.
(3)
(A) That has total assets of less than $1 billion as of December 31 of either of the two prior calendar years; and
(B) On or before July 6, 2012:
(1) Was not required under Federal or State law to deposit taxes, insurance premiums, fees, or any other charges in an escrow account for the entire term of a loan secured by residential improved real estate or a mobile home; and
(2) Did not have a policy of consistently and uniformly requiring the deposit of taxes, insurance premiums, fees, or any other charges in an escrow account for loans secured by residential improved real estate or a mobile home.
(ii)
(A) For any designated loan outstanding on July 1 of the succeeding calendar year, with the first loan payment on or after the first renewal date of the borrower's flood insurance policy on or after July 1 of the succeeding calendar year; or
(B) For any designated loan made on or after July 1 of the succeeding calendar year, upon loan consummation; or
(C) For any loan that becomes a designated loan after July 1 of the succeeding calendar year, with the first
(4)
(f)
(2)
(g)
(2)
(A) Notify the insurance provider to terminate any insurance purchased by the member bank or its servicer under paragraph (g)(1) of this section; and
(B) Refund to the borrower all premiums paid by the borrower for any insurance purchased by the member bank or its servicer under paragraph (g)(1) of this section during any period during which the borrower's flood insurance coverage and the insurance coverage purchased by the member bank or its servicer were each in effect, and any related fees charged to the borrower with respect to the insurance purchased by the member bank or its servicer during such period.
(ii)
(h)
(2)
(i) Is made in connection with a making, increasing, extending, or renewing of the loan that is initiated by the borrower;
(ii) Reflects the Administrator of FEMA's revision or updating of flood plain areas or flood-risk zones;
(iii) Reflects the Administrator of FEMA's publication of a notice or compendium that:
(A) Affects the area in which the building or mobile home securing the loan is located; or
(B) By determination of the Administrator of FEMA, may reasonably require a determination whether the building or mobile home securing the loan is located in a special flood hazard area; or
(iv) Results in the purchase of flood insurance coverage by the lender or its servicer on behalf of the borrower under paragraph (g) of this section.
(3)
(i)
(1)
(i) A warning, in a form approved by the Administrator of FEMA, that the building or the mobile home is or will be located in a special flood hazard area;
(ii) A description of the flood insurance purchase requirements set forth in section 102(b) of the Flood Disaster Protection Act of 1973, as amended (42 U.S.C. 4012a(b));
(iii) A statement, where applicable, that flood insurance coverage is available from private insurance companies that issue standard flood insurance policies on behalf of the NFIP or directly from the NFIP;
(iv) A statement that flood insurance that provides the same level of coverage as a standard flood insurance policy under the NFIP also may be available from a private insurance company that issues policies on behalf of the company;
(v) A statement that the borrower is encouraged to compare the flood insurance coverage, deductibles, exclusions, conditions and premiums associated with flood insurance policies issued on behalf of the NFIP and policies issued on behalf of private insurance companies and that the borrower should direct inquiries regarding the availability, cost, and comparisons of flood insurance coverage to an insurance agent; and
(vi) A statement whether Federal disaster relief assistance may be available in the event of damage to the building or mobile home caused by
(2)
(3)
(4)
(5)
(j)
(2)
We are giving you this notice to inform you that:
The building or mobile home securing the loan for which you have applied is or will be located in an area with special flood hazards.
The area has been identified by the Administrator of the Federal Emergency Management Agency (FEMA) as a special flood hazard area using FEMA's
Federal law allows a lender and borrower jointly to request the Administrator of FEMA to review the determination of whether the property securing the loan is located in a special flood hazard area. If you would like to make such a request, please contact us for further information.
_ The community in which the property securing the loan is located participates in the National Flood Insurance Program (NFIP). Federal law will not allow us to make you the loan that you have applied for if you do not purchase flood insurance. The flood insurance must be maintained for the life of the loan. If you fail to purchase or renew flood insurance on the property, Federal law authorizes and requires us to purchase the flood insurance for you at your expense.
• At a minimum, flood insurance purchased must cover
(1) the outstanding principal balance of the loan;
(2) the maximum amount of coverage allowed for the type of property under the NFIP.
Flood insurance coverage under the NFIP is limited to the building or mobile home and any personal property that secures your loan and not the land itself.
• Federal disaster relief assistance (usually in the form of a low-interest loan) may be available for damages incurred in excess of your flood insurance if your community's participation in the NFIP is in accordance with NFIP requirements.
Flood insurance coverage under the NFIP may be purchased through an insurance agent who will obtain the policy either directly through the NFIP or through an insurance company that participates in the NFIP. Flood insurance that provides the same level of coverage as a standard flood insurance policy under the NFIP may be available from private insurers that do not participate in the NFIP. You should compare the flood insurance coverage, deductibles, exclusions, conditions, and premiums associated with flood insurance policies issued on behalf of the NFIP and policies issued on behalf of private insurance companies and ask an insurance agent as to the availability, cost, and comparisons of flood insurance coverage.
Federal law requires a lender or its servicer to escrow all premiums and fees for flood insurance that covers any residential building or mobile home securing a loan that is located in an area with special flood hazards. These premiums and fees must be paid to the lender or its servicer with the same frequency as your loan payments for the duration of your loan and will be deposited in an escrow account on your behalf to be paid to the flood insurance provider. Upon receipt of a notice from the flood insurance provider that the premiums are due, the premiums shall be paid from the escrow account to the insurance provider. ]
_Flood insurance coverage under the NFIP is not available for the property securing the loan because the community in which the property is located does not participate in the NFIP. In addition, if the non-participating community has been identified for at least one year as containing a special flood hazard area, properties located in the community will not be eligible for Federal disaster relief assistance in the event of a Federally declared flood disaster.
We are giving you this notice to inform you that Federal law requires a lender or its servicer to escrow all premiums and fees for flood insurance that covers the building or mobile home securing your loan(s).
Federal law requires that you pay flood insurance premiums and fees with the same frequency as your loan payments for the duration of your loan. Your payments will be deposited in an escrow account so that when we receive a notice from your flood insurance provider that your flood insurance premiums are due, we will make payment from the escrow account to the insurance provider on your behalf.
When you receive your next flood insurance bill with the renewal of your
We will begin collecting the premiums and fees for your flood insurance escrow account with your mortgage loan payment following this renewal date for the next policy term. For example, if your flood insurance policy renewal date is September 15 and your next mortgage loan payment is October 1, the bank will begin collecting the flood insurance premiums and fees for escrow with the October 1 mortgage loan payment.
The escrow amount for flood insurance will be added to your existing periodic mortgage payment. The payments you make into the escrow account will accumulate over time and the funds will be used to pay your flood insurance policy at the next policy renewal date.
Any questions regarding this new escrow requirement should be directed to [Insert Name of Lender or Servicer] at [Insert Contact Information].
Federal law requires a lender or its servicer to escrow all premiums and fees for flood insurance that covers any residential building or mobile home securing a loan that is located in an area with special flood hazards. You must make payments of these premiums and fees to [Insert Name of Lender or Servicer] with the same frequency as your loan payments for the duration of your loan. Your payments will be deposited in an escrow account on your behalf to be paid to the flood insurance provider. Upon receipt of a notice from the flood insurance provider that the flood insurance premium is due, [Insert Name of Lender or Servicer] will pay the premium from the escrow account to the insurance provider.
For the reasons set forth in the joint preamble, the Board of Directors of the FDIC proposes to amend chapter III of title 12 of the Code of Federal Regulations to read as follows:
12 U.S.C. 1462, 1462a, 1463, 1464, 1819 (Tenth), 5412(b)(2)(C) and 42 U.S.C. 4012a, 4104a, 4104b, 4106, and 4128.
(a)
(b)
(c)
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(1) Is issued by an insurance company that is
(A) Licensed, admitted, or otherwise approved to engage in the business of insurance in the State or jurisdiction in which the insured building is located, by the insurance regulator of that State or jurisdiction; or
(B) In the case of a policy of difference in conditions, multiple peril, all risk, or other blanket coverage insuring nonresidential commercial policy, is recognized, or not disapproved, as a surplus lines insurer by the insurance regulator of the State where the property to be insured is located;
(2) Provides flood insurance coverage that is at least as broad as the coverage provided under a standard flood insurance policy under the NFIP, including when considering deductibles, exclusions, and conditions offered by the insurer;
(3) Includes all of the following:
(A) A requirement for the insurer to give 45 days' written notice of cancellation or non-renewal of flood insurance coverage to the insured and the FDIC-supervised institution;
(B) Information about the availability of flood insurance coverage under the NFIP;
(C) A mortgage interest clause similar to the clause contained in a standard flood insurance policy under the NFIP; and
(D) A provision requiring an insured to file suit not later than one year after the date of a written denial of all or part of a claim under the policy; and
(4) Contains cancellation provisions that are as restrictive as the provisions contained in a standard flood insurance policy under the NFIP.
(j)
(k)
(1) Receiving any scheduled, periodic payments from a borrower under the terms of a loan, including amounts for taxes, insurance premiums, and other charges with respect to the property securing the loan; and
(2) Making payments of principal and interest and any other payments from the amounts received from the borrower as may be required under the terms of the loan.
(l)
(m)
(a)
(b)
(c)
(2)
The flood insurance requirement prescribed by § 339.3 does not apply with respect to:
(a) Any state-owned property covered under a policy of self-insurance satisfactory to the Administrator of FEMA, who publishes and periodically revises the list of states falling within this exemption; or
(b) Property securing any loan with an original principal balance of $5,000 or less and a repayment term of one year or less.
(a)
(i) The loan is an extension of credit primarily for business, commercial, or agricultural purposes; or
(ii) The borrower has obtained flood insurance coverage that meets the requirements of § 339.3(a) for the residential improved real estate or mobile home securing the loan and is currently paying premiums and fees through an escrow account established by another lender; or
(iii) Flood insurance coverage for the residential improved real estate or mobile home is provided by a policy that is purchased by a common interest community instead of the borrower, such as an NFIP Residential Condominium Building Association Policy (RCBAP), that meets the requirements of § 339.3(a).
(2)
(i) For any designated loan outstanding on July 6, 2014, with the first loan payment on or after the first renewal date of the borrower's flood insurance policy on or after July 6, 2014;
(ii) For any designated loan made on or after July 6, 2014, upon loan consummation; or
(iii) For any loan that becomes a designated loan after July 6, 2014, with the first loan payment after the flood insurance policy is established.
(3)
(b)
(1) For loans subject to paragraphs (a)(2)(i), (c)(2)(i), or (d) of this section, at least 90 days before the escrow of premiums and fees under paragraphs (a)(2)(i), (c)(2)(i), or (d), using language that is substantially similar to the model form in appendix B; or
(2) For loans subject to paragraphs (a)(2)(ii) or (c)(2)(ii) of this section, with the notice provided under § 339.9, using language that is substantially similar to model clauses on the escrow requirement in appendix A; or
(3) For loans subject to paragraphs (a)(2)(iii) or (c)(2)(iii) of this section, with the notice provided under § 339.7, using language that is substantially similar to model clauses on the escrow requirement in appendix C.
(c)
(1)
(i) That has total assets of less than $1 billion as of December 31 of either of the two prior calendar years; and
(ii) On or before July 6, 2012:
(A) Was not required under Federal or State law to deposit taxes, insurance premiums, fees, or any other charges in an escrow account for the entire term of
(B) Did not have a policy of consistently and uniformly requiring the deposit of taxes, insurance premiums, fees, or any other charges in an escrow account for loans secured by residential improved real estate or a mobile home.
(2)
(i) For any designated loan outstanding on July 1 of the succeeding calendar year, with the first loan payment on or after the first renewal date of the borrower's flood insurance policy on or after July 1 of the succeeding calendar year; or
(ii) For any designated loan made on or after July 1 of the succeeding calendar year, upon loan consummation; or
(iii) For any loan that becomes a designated loan after July 1 of the succeeding calendar year, with the first loan payment after the flood insurance policy is established.
(d)
(a)
(b)
(a)
(b)
(A) Notify the insurance provider to terminate any insurance purchased by the FDIC-supervised institution or its servicer under paragraph (a) of this section; and
(B) Refund to the borrower all premiums paid by the borrower for any insurance purchased by the FDIC-supervised institution or its servicer under paragraph (a) of this section during any period during which the borrower's flood insurance coverage and the insurance coverage purchased by the FDIC-supervised institution or its servicer were each in effect, and any related fees charged to the borrower with respect to the insurance purchased by the FDIC-supervised institution or its servicer during such period.
(2)
(a)
(b)
(1) Is made in connection with a making, increasing, extending, or renewing of the loan that is initiated by the borrower;
(2) Reflects the Administrator of FEMA's revision or updating of floodplain areas or flood-risk zones;
(3) Reflects the Administrator of FEMA's publication of a notice or compendium that:
(i) Affects the area in which the building or mobile home securing the loan is located; or
(ii) By determination of the Administrator of FEMA, may reasonably require a determination whether the building or mobile home securing the loan is located in a special flood hazard area; or
(4) Results in the purchase of flood insurance coverage by the lender or its servicer on behalf of the borrower under § 339.7.
(c)
(a)
(b)
(1) A warning, in a form approved by the Administrator of FEMA, that the building or the mobile home is or will be located in a special flood hazard area;
(2) A description of the flood insurance purchase requirements set forth in section 102(b) of the Flood Disaster Protection Act of 1973, as amended (42 U.S.C. 4012a(b));
(3) A statement, where applicable, that flood insurance coverage is available from private insurance companies that issue flood insurance policies on behalf of the NFIP or directly from the NFIP;
(4) A statement that flood insurance that provides the same level of coverage as a standard flood insurance policy under the NFIP may also be available from a private insurance company that issues policies on behalf of the company.
(5) A statement that the borrower is encouraged to compare the flood insurance coverage, deductibles, exclusions, conditions and premiums associated with flood insurance policies issued on behalf of the NFIP and policies issued on behalf of private insurance companies and that the borrower should direct inquiries regarding the availability, cost, and comparisons of flood insurance coverage to an insurance agent; and
(6) A statement whether Federal disaster relief assistance may be available in the event of damage to the building or mobile home caused by flooding in a Federally-declared disaster.
(c)
(d)
(e)
(f)
(a)
(b)
We are giving you this notice to inform you that:
The building or mobile home securing the loan for which you have applied is or will be located in an area with special flood hazards.
The area has been identified by the Administrator of the Federal Emergency Management Agency (FEMA) as a special flood hazard area using FEMA's
Federal law allows a lender and borrower jointly to request the Administrator of FEMA to review the determination of whether the property securing the loan is located in a special flood hazard area. If you would like to make such a request, please contact us for further information.
_ The community in which the property securing the loan is located participates in the National Flood Insurance Program (NFIP). Federal law will not allow us to make you the loan that you have applied for if you do not purchase flood insurance. The flood insurance must be maintained for the life of the loan. If you fail to purchase or renew flood insurance on the property, Federal law authorizes and requires us to purchase the flood insurance for you at your expense.
• At a minimum, flood insurance purchased must cover
(1) the outstanding principal balance of the loan;
(2) the maximum amount of coverage allowed for the type of property under the NFIP.
Flood insurance coverage under the NFIP is limited to the building or mobile home and any personal property that secures your loan and not the land itself.
• Federal disaster relief assistance (usually in the form of a low-interest loan) may be available for damages incurred in excess of your flood insurance if your community's participation in the NFIP is in accordance with NFIP requirements.
Flood insurance coverage under the NFIP may be purchased through an insurance agent who will obtain the policy either directly through the NFIP or through an insurance company that participates in the NFIP. Flood insurance that provides the same level of coverage as a standard flood insurance policy under the NFIP may be available from private insurers that do not participate in the NFIP. You should compare the flood insurance coverage, deductibles, exclusions, conditions and premiums associated with flood insurance policies issued on behalf of the NFIP and policies issued on behalf of private insurance
Federal law requires a lender or its servicer to escrow all premiums and fees for flood insurance that covers any residential building or mobile home securing a loan that is located in an area with special flood hazards. These premiums and fees must be paid to the lender or its servicer with the same frequency as your loan payments for the duration of your loan and will be deposited in an escrow account on your behalf to be paid to the flood insurance provider. Upon receipt of a notice from the flood insurance provider that the premiums are due, the premiums shall be paid from the escrow account to the insurance provider.]
_Flood insurance coverage under the NFIP is not available for the property securing the loan because the community in which the property is located does not participate in the NFIP. In addition, if the non-participating community has been identified for at least one year as containing a special flood hazard area, properties located in the community will not be eligible for Federal disaster relief assistance in the event of a Federally-declared flood disaster.
We are giving you this notice to inform you that Federal law requires a lender or its servicer to escrow all premiums and fees for flood insurance that covers the building or mobile home securing your loan(s).
Federal law requires that you pay flood insurance premiums and fees with the same frequency as your loan payments for the duration of your loan. Your payments will be deposited in an escrow account so that when we receive a notice from your flood insurance provider that your flood insurance premiums are due, we will make payment from the escrow account to the insurance provider on your behalf.
When you receive your next flood insurance bill with the renewal of your policy from your flood insurance provider, you are responsible for making that payment directly to your insurance provider.
We will begin collecting the premiums and fees for your flood insurance escrow account with your mortgage loan payment following this renewal date for the next policy term. For example, if your flood insurance policy renewal date is September 15 and your next mortgage loan payment is October 1, the bank will begin collecting the flood insurance premiums and fees for escrow with the October 1 mortgage loan payment.
The escrow amount for flood insurance will be added to your existing periodic mortgage payment. The payments you make into the escrow account will accumulate over time and the funds will be used to pay your flood insurance policy at the next policy renewal date.
Any questions regarding this new escrow requirement should be directed to [Insert Name of Lender or Servicer] at [Insert Contact Information].
Federal law requires a lender or its servicer to escrow all premiums and fees for flood insurance that covers any residential building or mobile home securing a loan that is located in an area with special flood hazards. You must make payments of these premiums and fees to [Insert Name of Lender or Servicer] with the same frequency as your loan payments for the duration of your loan. Your payments will be deposited in an escrow account on your behalf to be paid to the flood insurance provider. Upon receipt of a notice from the flood insurance provider that the flood insurance premium is due, [Insert Name of Lender or Servicer] will pay the premium from the escrow account to the insurance provider.
12 U.S.C. 1819.
For the reasons stated in the preamble, part 614 of chapter VI, title 12 of the Code of Federal Regulations is proposed to be amended as follows:
42 U.S.C. 4012a, 4104a, 4104b, 4106, and 4128; secs. 1.3, 1.5, 1.6, 1.7, 1.9, 1.10, 2.0, 2.2, 2.3, 2.4, 2.10, 2.12, 2.13, 2.15, 3.0, 3.1, 3.3, 3.7, 3.8, 3.10, 3.20, 3.28, 4.12, 4.12A, 4.13, 4.13B, 4.14, 4.14A, 4.14C, 4.14D, 4.14E, 4.18, 4.19, 4.36, 4.37, 5.9, 5.10, 5.17, 7.0, 7.2, 7.6, 7.7, 7.8, 7.12, 7.13, 8.0, 8.5 of the Farm Credit Act (12 U.S.C. 2011, 2013, 2014, 2015, 2017, 2018, 2071, 2073, 2074, 2075, 2091, 2093, 2094, 2096, 2121, 2122, 2124, 2128, 2129, 2131, 2141, 2149, 2183, 2184, 2199, 2201, 2202, 2202a, 2202c, 2202d, 2202e, 2206, 2207, 2219a, 2219b, 2243, 2244, 2252, 2279a, 2279a-2, 2279b, 2279b-1, 2279b-2, 2279f, 2279f-1, 2279aa, 2279aa-5); sec. 413 of Pub. L. 100-233, 101 Stat. 1568, 1639.
Appendix A to Subpart S of Part 614—Sample Form of Notice of Special Flood Hazards and Availability of Federal Disaster Relief Assistance
Appendix B to Subpart S of Part 614—Sample Form of Notice of Requirement to Escrow for Outstanding Loans
Appendix C to Subpart S of Part 614—Sample Escrow Requirement Clause for Loans that Become Designated Loans
(a)
(b)
For the purposes of this subpart:
(a)
(b)
(c)
(d)
(e)
(f)
(h)
(i)
(1) Is issued by an insurance company that is
(i) Licensed, admitted, or otherwise approved to engage in the business of insurance in the State or jurisdiction in which the insured building is located, by the insurance regulator of that State or jurisdiction; or
(ii) In the case of a policy of difference in conditions, multiple peril, all risk, or other blanket coverage insuring nonresidential commercial policy, is recognized, or not disapproved, as a surplus lines insurer by the insurance regulator of the State where the property to be insured is located;
(2) Provides flood insurance coverage that is at least as broad as the coverage provided under a standard flood insurance policy under the NFIP, including when considering deductibles, exclusions, and conditions offered by the insurer;
(3) Includes all of the following:
(i) A requirement for the insurer to give 45 days' written notice of cancellation or non-renewal of flood insurance coverage to the insured and the System institution;
(ii) Information about the availability of flood insurance coverage under the NFIP;
(iii) A mortgage interest clause similar to the clause contained in a standard flood insurance policy under the NFIP; and
(iv) A provision requiring an insured to file suit not later than one year after the date of a written denial of all or part of a claim under the policy; and
(4) Contains cancellation provisions that are as restrictive as the provisions contained in a standard flood insurance policy under the NFIP.
(j)
(k)
(1) Receiving any scheduled, periodic payments from a borrower under the terms of a loan, including amounts for taxes, insurance premiums, and other charges with respect to the property securing the loan; and
(2) Making payments of principal and interest and any other payments from the amounts received from the borrower as may be required under the terms of the loan.
(l)
(m)
(a)
(b)
(c)
(1)
(2)
(d) The flood insurance requirement of paragraph (a) of this section does not apply with respect to:
(1) Any State-owned property covered under a policy of self-insurance satisfactory to the Administrator of FEMA, who publishes and periodically revises the list of States falling within this exemption; or
(2) Property securing any loan with an original principal balance of $5,000 or less and a repayment term of 1 year or less.
(a)
(1)
(i) The loan is an extension of credit primarily for business, commercial, or agricultural purposes; or
(ii) The borrower has obtained flood insurance coverage that meets the requirement of § 614.4930(a) for the residential improved real estate or mobile home securing the loan and is currently paying premiums and fees through an escrow account established by another lender; or
(iii) Flood insurance coverage for the residential improved real estate or mobile home is provided by a policy that is purchased by a common interest community instead of the borrower, such as an NFIP Residential Condominium Building Association Policy (RCBAP), that meets the requirements of § 614.4930(a).
(2)
(i) For any designated loan outstanding on July 6, 2014, with the first loan payment on or after the first renewal date of the borrower's flood insurance policy on or after July 6, 2014;
(ii) For any designated loan made on or after July 6, 2014, upon loan consummation; or
(iii) For any loan that becomes a designated loan after July 6, 2014, with the first loan payment after the flood insurance policy is established.
(3)
(b)
(1) For loans subject to paragraph (a)(2)(i) or (c)(2)(i) or (d) of this section, at least 90 days before the escrow of premiums and fees under paragraph (a)(2)(i) or (c)(2)(i) or (d), using language that is substantially similar to the model form in Appendix B; or
(2) For loans subject to paragraph (a)(2)(ii) or (c)(2)(ii) of this section, with the notice provided under § 614.4945, using language that is substantially similar to model clauses on the escrow requirement in Appendix A; or
(3) For loans subject to paragraph (a)(2)(iii) or (c)(2)(iii) of this section, with the notice provided under § 614.4955, using language that is substantially similar to model clauses on the escrow requirement in Appendix C.
(c)
(i) That has total assets of less than $1 billion as of December 31 of either of the 2 prior calendar years; and
(ii) On or before July 6, 2012:
(A) Was not required under Federal or State law to deposit taxes, insurance premiums, fees, or any other charges in an escrow account for the entire term of a loan secured by residential improved real estate or a mobile home; and
(B) Did not have a policy of consistently and uniformly requiring the deposit of taxes, insurance premiums, fees, or any other charges in an escrow account for loans secured by residential improved real estate or a mobile home.
(2)
(i) For any designated loan outstanding on July 1 of the succeeding calendar year, with the first loan payment on or after the first renewal date of the borrower's flood insurance policy on or after July 1 of the succeeding calendar year; or
(ii) For any designated loan made on or after July 1 of the succeeding calendar year, upon loan consummation; or
(iii) For any loan that becomes a designated loan after July 1 of the succeeding calendar year, with the first loan payment after the flood insurance policy is established.
(d)
(a)
(b)
(a)
(b)
(i) Notify the insurance provider to terminate any insurance purchased by the System institution or its servicer under paragraph (a) of this section; and
(ii) Refund to the borrower all premiums paid by the borrower for any insurance purchased by the System institution or its servicer under paragraph (a) of this section during any period during which the borrower's flood insurance coverage and the insurance coverage purchased by the System institution or its servicer were each in effect, and any related fees charged to the borrower with respect to the insurance purchased by the System institution or its servicer during such period.
(2)
(a)
(b)
(1) Is made in connection with a making, increasing, extending, or renewing of the loan that is initiated by the borrower;
(2) Reflects the Administrator of FEMA's revision or updating of floodplain areas or flood-risk zones;
(3) Reflects the Administrator of FEMA's publication of a notice or compendium that:
(i) Affects the area in which the building or mobile home securing the loan is located; or
(ii) By determination of the Administrator of FEMA, may reasonably require a determination whether the building or mobile home securing the loan is located in a special flood hazard area; or
(4) Results in the purchase of flood insurance coverage by the lender or its servicer on behalf of the borrower under § 614.4945.
(c)
(a)
(b)
(1) A warning, in a form approved by the Administrator of FEMA, that the building or the mobile home is or will be located in a special flood hazard area;
(2) A description of the flood insurance purchase requirements set forth in section 102(b) of the Flood Disaster Protection Act of 1973, as amended (42 U.S.C. 4012a(b));
(3) A statement, where applicable, that flood insurance coverage is available from private insurance companies that issue flood insurance policies on behalf of the NFIP or directly from the NFIP; and
(4) A statement that flood insurance that provides the same level of coverage as a standard flood insurance policy under the NFIP may be available from a private insurance company that issues policies on behalf of the company.
(5) A statement that the borrower is encouraged to compare the flood insurance coverage, deductibles, exclusions, conditions and premiums associated with flood insurance policies issued on behalf of the NFIP and policies issued on behalf of private insurance companies and that the borrower should direct inquiries regarding the availability, cost, and comparisons of flood insurance coverage to an insurance agent; and
(6) A statement whether federal disaster relief assistance may be available in the event of damage to the building or mobile home caused by flooding in a federally declared disaster.
(c)
(d)
(e)
(f)
(a)
(b)
We are giving you this notice to inform you that:
The building or mobile home securing the loan for which you have applied is or will be located in an area with special flood hazards.
The area has been identified by the Administrator of the Federal Emergency Management Agency (FEMA) as a special
Federal law allows a lender and borrower jointly to request the Administrator of FEMA to review the determination of whether the property securing the loan is located in a special flood hazard area. If you would like to make such a request, please contact us for further information.
____ The community in which the property securing the loan is located participates in the National Flood Insurance Program (NFIP). Federal law will not allow us to make you the loan that you have applied for if you do not purchase flood insurance. The flood insurance must be maintained for the life of the loan. If you fail to purchase or renew flood insurance on the property, federal law authorizes and requires us to purchase the flood insurance for you at your expense.
• Flood insurance coverage under the NFIP may be purchased through an insurance agent who will obtain the policy either directly through the NFIP or through an insurance company that participates in the NFIP. Flood insurance also may be available from private insurers that do not participate in the NFIP.
• At a minimum, flood insurance purchased must cover
(1) the outstanding principal balance of the loan;
(2) the maximum amount of coverage allowed for the type of property under the NFIP.
Flood insurance coverage under the NFIP is limited to the improvements that have been made to the real property that secure the loan and not the land itself.
• Federal disaster relief assistance (usually in the form of a low-interest loan) may be available for damages incurred in excess of your flood insurance if your community's participation in the NFIP is in accordance with NFIP requirements.
Flood insurance coverage under the NFIP may be purchased through an insurance agent who will obtain the policy either directly through the NFIP or through an insurance company that participates in the NFIP. Flood insurance that provides the same level of coverage as a standard flood insurance policy under the NFIP may be available from private insurers that do not participate in the NFIP. You should compare the flood insurance coverage, deductibles, exclusions, conditions and premiums associated with flood insurance policies issued on behalf of the NFIP and policies issued on behalf of private insurance companies and ask an insurance agent as to the availability, cost, and comparisons of flood insurance coverage.
Federal law requires a lender or its servicer to escrow all premiums and fees for flood insurance that covers any residential building or mobile home securing a loan that is located in an area with special flood hazards. These premiums and fees must be paid to the lender or its servicer with the same frequency as your loan payments for the duration of your loan and will be deposited in an escrow account on your behalf to be paid to the flood insurance provider. Upon receipt of a notice from the flood insurance provider that the premiums are due, the premiums shall be paid from the escrow account to the insurance provider.]
_ Flood insurance coverage under the NFIP is not available for the property securing the loan because the community in which the property is located does not participate in the NFIP. In addition, if the non-participating community has been identified for at least one year as containing a special flood hazard area, properties located in the community will not be eligible for federal disaster relief assistance in the event of a federally-declared flood disaster.
We are giving you this notice to inform you that Federal law requires a lender or its servicer to escrow all premiums and fees for flood insurance that covers the building or mobile home securing your loan(s).
Federal law requires that you pay flood insurance premiums and fees with the same frequency as your loan payments for the duration of your loan. Your premiums will be deposited in an escrow account so that when we receive a notice from your flood insurance provider that your flood insurance premiums are due, we will make payment from the escrow account to the insurance provider on your behalf.
We will begin collecting the premiums and fees for your flood insurance escrow account with your mortgage loan payment following this renewal date for the next policy term. For example, if your flood insurance policy renewal date is September 15 and your next mortgage loan payment is October 1, the institution will begin collecting the flood insurance premiums and fees for escrow with the October 1 mortgage loan payment.
The escrow amount for flood insurance will be added to your existing periodic mortgage payment. The payments you make into the escrow account will accumulate over time and the funds will be used to pay your flood insurance policy at the next policy renewal date.
Any questions regarding this new escrow requirement should be directed to [Insert Name of Lender or Servicer] at [Insert Contact Information].
Federal law requires a lender or its servicer to escrow all premiums and fees for flood insurance that covers any residential building or mobile home securing a loan that is located in an area with special flood hazards. You must make payments of these premiums and fees to [Insert Name of Lender or Servicer] with the same frequency as your loan payments for the duration of your loan. Your payments will be deposited in an escrow account on your behalf to be paid to the flood insurance provider. Upon receipt of a notice from the flood insurance provider that the flood insurance premium is due, [Insert Name of Lender or Servicer] will pay the premium from the escrow account to the insurance provider.
For the reasons set forth in the joint preamble, the NCUA Board proposes to revise part 760 of chapter VII of title 12 of the Code of Federal Regulations to read as follows:
12 U.S.C. 1757, 1789; 42 U.S.C. 4012a, 4104a, 4104b, 4106, and 4128.
(a)
(b)
(c)
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(1) Is issued by an insurance company that is:
(i) Licensed, admitted, or otherwise approved to engage in the business of insurance in the State or jurisdiction in which the insured building is located, by the insurance regulator of that State or jurisdiction; or
(ii) Recognized, or not disapproved, as a surplus lines insurer by the insurance regulator of the State where the property to be insured is located in the case of a policy of difference in conditions, multiple peril, all risk, or other blanket coverage insuring non-residential commercial policies;
(2) Provides flood insurance coverage that is at least as broad as the coverage provided under a standard flood insurance policy under the NFIP, including when considering deductibles, exclusions, and conditions offered by the insurer;
(3) Includes all of the following:
(i) A requirement for the insurer to give 45 days' written notice of cancellation or non-renewal of flood insurance coverage to the insured and the credit union;
(ii) Information about the availability of flood insurance coverage under the NFIP;
(iii) A mortgage interest clause similar to the clause contained in a standard flood insurance policy under the NFIP; and
(iv) A provision requiring an insured to file suit not later than one year after the date of a written denial of all or part of a claim under the policy; and
(4) Contains cancellation provisions that are as restrictive as the provisions contained in a standard flood insurance policy under the NFIP.
(j)
(k)
(1) Receiving any scheduled, periodic payments from a borrower under the terms of a loan, including amounts for taxes, insurance premiums, and other charges with respect to the property securing the loan; and
(2) Making payments of principal and interest and any other payments from the amounts received from the borrower as may be required under the terms of the loan.
(l)
(m)
(a)
(b)
(c)
(1)
(2)
The flood insurance requirement prescribed by § 760.3 does not apply with respect to:
(a) Any State-owned property covered under a policy of self-insurance satisfactory to the Administrator of FEMA, who publishes and periodically revises the list of States falling within this exemption; or
(b) Property securing any loan with an original principal balance of $5,000 or less and a repayment term of one year or less.
(a)
(i) The loan is an extension of credit primarily for business, commercial, or agricultural purposes;
(ii) The borrower has obtained flood insurance coverage that meets the requirement of § 760.3(a) for the residential improved real estate or mobile home securing the loan and is currently paying premiums and fees through an escrow account established by another lender; or
(iii) Flood insurance coverage for the residential improved real estate or mobile home is provided by a policy that is purchased by a common interest community instead of the borrower, such as an NFIP Residential Condominium Building Association Policy (RCBAP), that meets the requirements of § 760.3(a).
(2)
(i) For any designated loan outstanding on July 6, 2014, with the first loan payment on or after the first renewal date of the borrower's flood insurance policy on or after July 6, 2014;
(ii) For any designated loan made on or after July 6, 2014, upon loan consummation; or
(iii) For any loan that becomes a designated loan after July 6, 2014, with the first loan payment after the flood insurance policy is established.
(3)
(b)
(1) For loans subject to paragraphs (a)(2)(i), (c)(2)(i), or (d) of this section, at least 90 days before the escrow of premiums and fees under paragraphs (a)(2)(i), (c)(2)(i), or (d), using language that is substantially similar to the model form in appendix B;
(2) For loans subject to paragraphs (a)(2)(ii) or (c)(2)(ii) of this section, with the notice provided under § 760.9, using language that is substantially similar to model clauses on the escrow requirement in appendix A; or
(3) For loans subject to paragraphs (a)(2)(iii) or (c)(2)(iii) of this section, with the notice provided under § 760.7, using language that is substantially similar to model clauses on the escrow requirement in appendix C.
(c)
(1)
(i) That has total assets of less than $1 billion as of December 31 of either of the two prior calendar years; and
(ii) On or before July 6, 2012:
(A) Was not required under Federal or State law to deposit taxes, insurance premiums, fees, or any other charges in an escrow account for the entire term of a loan secured by residential improved real estate or a mobile home; and
(B) Did not have a policy of consistently and uniformly requiring the deposit of taxes, insurance premiums, fees, or any other charges in an escrow account for loans secured by residential improved real estate or a mobile home.
(2)
(i) For any designated loan outstanding on July 1 of the succeeding calendar year, with the first loan payment on or after the first renewal date of the borrower's flood insurance policy on or after July 1 of the succeeding calendar year;
(ii) For any designated loan made on or after July 1 of the succeeding calendar year, upon loan consummation; or
(iii) For any loan that becomes a designated loan after July 1 of the succeeding calendar year, with the first loan payment after the flood insurance policy is established.
(d)
(a)
(b)
(a)
(b)
(i) Notify the insurance provider to terminate any insurance purchased by the credit union or its servicer under paragraph (a) of this section; and
(ii) Refund to the borrower all premiums paid by the borrower for any insurance purchased by the credit union or its servicer under paragraph (a) of this section during any period during which the borrower's flood insurance coverage and the insurance coverage purchased by the credit union or its servicer were each in effect, and any related fees charged to the borrower with respect to the insurance purchased by the credit union or its servicer during such period.
(2)
(a)
(b)
(1) Is made in connection with a making, increasing, extending, or renewing of the loan that is initiated by the borrower;
(2) Reflects the Administrator of FEMA's revision or updating of floodplain areas or flood-risk zones;
(3) Reflects the Administrator of FEMA's publication of a notice or compendium that:
(i) Affects the area in which the building or mobile home securing the loan is located; or
(ii) By determination of the Administrator of FEMA, may reasonably require a determination whether the building or mobile home securing the loan is located in a special flood hazard area; or
(4) Results in the purchase of flood insurance coverage by the credit union or its servicer on behalf of the borrower under § 760.7.
(c)
(a)
(b)
(1) A warning, in a form approved by the Administrator of FEMA, that the building or the mobile home is or will be located in a special flood hazard area;
(2) A description of the flood insurance purchase requirements set forth in section 102(b) of the Flood Disaster Protection Act of 1973, as amended (42 U.S.C. 4012a(b));
(3) A statement, where applicable, that flood insurance coverage is available from private insurance companies that issue flood insurance policies on behalf of the NFIP or directly from the NFIP;
(4) A statement that flood insurance that provides the same level of coverage as a standard flood insurance policy under the NFIP may also be available from a private insurance company that issues policies on behalf of the company;
(5) A statement that the borrower is encouraged to compare the flood insurance coverage, deductibles, exclusions, conditions and premiums associated with flood insurance policies issued on behalf of the NFIP and policies issued on behalf of private insurance companies and that the borrower should direct inquiries regarding the availability, cost, and comparisons of flood insurance coverage to an insurance agent; and
(6) A statement whether Federal disaster relief assistance may be available in the event of damage to the building or mobile home caused by flooding in a Federally-declared disaster.
(c)
(d)
(e)
(f)
(a)
(b)
We are giving you this notice to inform you that:
The building or mobile home securing the loan for which you have applied is or will be located in an area with special flood hazards.
The area has been identified by the Administrator of the Federal Emergency Management Agency (FEMA) as a special flood hazard area using FEMA's
Federal law allows a lender and borrower jointly to request the Administrator of FEMA to review the determination of whether the property securing the loan is located in a special flood hazard area. If you would like to make such a request, please contact us for further information.
_ The community in which the property securing the loan is located participates in the National Flood Insurance Program (NFIP). Federal law will not allow us to make you the loan that you have applied for if you do not purchase flood insurance. The flood insurance must be maintained for the life of the loan. If you fail to purchase or renew flood insurance on the property, Federal law authorizes and requires us to purchase the flood insurance for you at your expense.
• At a minimum, flood insurance purchased must cover
(1) the outstanding principal balance of the loan;
(2) the maximum amount of coverage allowed for the type of property under the NFIP.
Flood insurance coverage under the NFIP is limited to the building or mobile home and any personal property that secures your loan and not the land itself.
• Federal disaster relief assistance (usually in the form of a low-interest loan) may be available for damages incurred in excess of your flood insurance if your community's participation in the NFIP is in accordance with NFIP requirements.
Flood insurance coverage under the NFIP may be purchased through an insurance agent who will obtain the policy either directly through the NFIP or through an insurance company that participates in the NFIP. Flood insurance that provides the same level of coverage as a standard flood insurance policy under the NFIP may be available from private insurers that do not participate in the NFIP. You should compare the flood insurance coverage, deductibles, exclusions, conditions and premiums associated with flood insurance policies issued on behalf of the NFIP and policies issued on behalf of private insurance companies and ask an insurance agent as to the availability, cost, and comparisons of flood insurance coverage.
Federal law requires a lender or its servicer to escrow all premiums and fees for flood insurance that covers any residential building or mobile home securing a loan that is located in an area with special flood hazards. These premiums and fees must be paid to the lender or its servicer with the same frequency as your loan payments for the duration of your loan and will be deposited in an escrow account on your behalf to be paid to the flood insurance provider. Upon receipt of a notice from the flood insurance provider that the premiums are due, the premiums shall be paid from the escrow account to the insurance provider.]
_ Flood insurance coverage under the NFIP is not available for the property securing the loan because the community in which the property is located does not participate in the NFIP. In addition, if the non-participating community has been identified for at least one year as containing a special flood hazard area, properties located in the community will not be eligible for Federal disaster relief assistance in the event of a Federally-declared flood disaster.
We are giving you this notice to inform you that Federal law requires a lender or its servicer to escrow all premiums and fees for flood insurance that covers the building or mobile home securing your loan(s).
Federal law requires that you pay flood insurance premiums and fees with the same frequency as your loan payments for the duration of your loan. Your payments will be deposited in an escrow account so that when we receive a notice from your flood insurance provider that your flood insurance premiums are due, we will make payment from the escrow account to the insurance provider on your behalf.
When you receive your next flood insurance bill with the renewal of your policy from your flood insurance provider, you are responsible for making that payment directly to your insurance provider.
We will begin collecting the premiums and fees for your flood insurance escrow account with your mortgage loan payment following this renewal date for the next policy term. For example, if your flood insurance policy renewal date is September 15 and your next mortgage loan payment is October 1, the credit union will begin collecting the flood insurance premiums and fees for escrow with the October 1 mortgage loan payment.
The escrow amount for flood insurance will be added to your existing periodic mortgage payment. The payments you make into the escrow account will accumulate over time and the funds will be used to pay your flood insurance policy at the next policy renewal date.
Any questions regarding this new escrow requirement should be directed to [Insert Name of Lender or Servicer] at [Insert Contact Information].
Federal law requires a lender or its servicer to escrow all premiums and fees for flood insurance that covers any residential building or mobile home securing a loan that is located in an area with special flood hazards. You must make payments of these premiums and fees to [Insert Name of Lender or Servicer] with the same frequency as your loan payments for the duration of your loan. Your payments will be deposited in an escrow account on your behalf to be paid to the flood insurance provider. Upon receipt of a notice from the flood insurance provider that the flood insurance premium is due, [Insert Name of Lender or Servicer] will pay the premium from the escrow account to the insurance provider.
By order of the Board of Directors of the Federal Deposit Insurance Corporation.
By order of the Board of the Farm Credit Administration.
By order of the Board of the National Credit Union Association.