The information presented in this preamble is organized as follows:

These product categories are designated under the authority of section 9002 of the Farm Security and Rural Investment Act of 2002 (the 2002 Farm Bill), as amended by the Food, Conservation, and Energy Act of 2008 (the 2008 Farm Bill), and further amended by the Agricultural Act of 2014 (the 2014 Farm Bill) and the Agricultural Improvement Act of 2018 (the 2018 Farm Bill), 7 U.S.C. 8102. (Section 9002 of the 2002 Farm Bill, as amended by the 2008, 2014, and 2018 Farm Bills, is referred to in this document as “section 9002”.)

As part of the BioPreferred Program, USDA published, on September 14, 2018, a proposed rule in the Federal Register (FR) for the purpose of designating a total of 30 product categories for the preferred procurement of biobased products by Federal agencies (referred to hereafter in this FR document as the “preferred procurement program”). This proposed rule can be found at 83 FR 46780.

Section 9002 provides for the preferred procurement of biobased products by Federal procuring agencies and is referred to hereafter in this Federal Register document as the “Federal preferred procurement program.” Under the provisions specified in the “Guidelines for Designating Biobased Products for Federal Procurement” in title 7 of the U.S. Code of Federal Regulations (CFR), part 3201 (Guidelines), the USDA BioPreferred Program “designates” product categories to which the preferred procurement requirements apply by listing them in subpart B of 7 CFR part 3201.

The term “product category” is used as a generic term in the designation process to mean a grouping of specific products that perform a similar function. As originally finalized, the Guidelines included provisions for the designation of product categories that were composed of finished, consumer products such as mobile equipment hydraulic fluids, penetrating lubricants, or hand cleaners and sanitizers.

The 2008, 2014, and 2018 Farm Bills directed USDA to expand the scope of the Guidelines to include the designation of product categories composed of both intermediate ingredients and feedstock materials and finished products made from those materials. Specifically, the 2008 Farm Bill stated that USDA shall “designate those items (including finished products) that are or can be produced with biobased products (including biobased products for which there is only a single product or manufacturer in the category) that will be subject to” Federal preferred procurement, “designate those intermediate ingredients and feedstocks that are or can be used to produce items that will be subject” to Federal preferred procurement, and “automatically designate items composed of [designated] intermediate ingredients and feedstocks . . . if the content of the designated intermediate ingredients and feedstocks exceeds 50 percent of the item (unless the Secretary determines a different composition percentage is appropriate).”

In the proposed rule, USDA proposed to designate 30 product categories that contain finished products made from biobased intermediate ingredients and feedstocks. USDA also proposed to amend the existing designated product categories of general purpose de-icers, firearm lubricants, laundry products, and water clarifying agents.

This final rule designates the proposed product categories within which biobased products will be afforded Federal procurement preference. USDA has determined that each of the product categories being designated under this rulemaking meets the necessary statutory requirements; that they are being produced with biobased products; and that their procurement will carry out the following objectives of section 9002: To improve demand for biobased products; to spur development of the industrial base through value-added agricultural processing and manufacturing in rural communities; and to enhance the Nation's energy security by substituting biobased products for products derived from imported oil and natural gas.

When USDA designates by rulemaking a product category for preferred procurement under the BioPreferred Program, manufacturers of all products under the umbrella of that product category that meet the requirements to qualify for preferred procurement can claim that status for their products. To qualify for preferred procurement, a product must be within a designated product category and must contain at least the minimum biobased content established for the designated product category. With the designation of these specific product categories, USDA invites the manufacturers and vendors of qualifying products to provide information on the product, contacts, and performance testing for posting on its BioPreferred website, http://www.biopreferred.gov. Procuring agencies will be able to utilize this website as one tool to determine the availability of qualifying biobased products under a designated product category. Once USDA designates a product category, procuring agencies are required generally to purchase biobased products within the designated product category where the purchase price of the procurement product exceeds $10,000 or where the quantity of such products or of functionally equivalent products purchased over the preceding fiscal year equaled $10,000 or more.

Subcategorization. In this final rule, USDA is subcategorizing one of the product categories. That product category is concrete repair materials, and the proposed subcategories are: Concrete leveling and concrete patching. USDA is also adding a new subcategory for dryer sheets to the laundry products product category that was designated previously (73 FR 27994, May 14, 2008).

Minimum Biobased Contents. The minimum biobased contents being established in this rule are based on products for which USDA has biobased content test data. USDA obtains biobased content data in conjunction with product manufacturers' and vendors' applications for certification to use the USDA Certified Biobased Product label. Products that are certified to display the label must undergo biobased content testing by an independent, third-party testing lab using ASTM D6866, “Standard Test Methods for Determining the Biobased Content of Solid, Liquid, and Gaseous Samples Using Radiocarbon Analysis.” These test data are maintained in the BioPreferred Program database, and their use in setting the minimum biobased content for designated product categories results in a more efficient process for both the Program and manufacturers and vendors of products within the product categories.

Overlap with the U.S. Environmental Protection Agency's (EPA) Comprehensive Procurement Guideline program for recovered content products under the Resource Conservation and Recovery Act (RCRA) section 6002. Some of the products that are categorized in biobased product categories that are designated for Federal preferred procurement under the BioPreferred Program may overlap with product categories that the U.S. Environmental Protection Agency (EPA) has designated under its Comprehensive Procurement Guideline (CPG) for products containing recovered (or recycled) materials. A list of EPA's CPG program product categories may be found on its website ( https://www.epa.gov/smm/comprehensive-procurement-guideline-cpg-program ) and in 40 CFR part 247. In this final rule, some products that are categorized in the product categories of concrete curing agents; concrete repair materials—concrete leveling; concrete repair materials—concrete patching; exterior paints and coatings; folders and filing products; other lubricants; playground and athletic surface materials; product packaging; rugs or floor mats; shopping and trash bags; soil amendments; and transmission fluids may also be categorized in one or more of the following product categories that are designated in EPA's CPG program:

• Construction Products: Cement and Concrete; Consolidated and Reprocessed Latex Paint for Specified Uses;

• Landscaping Products: Compost Made From Recovered Organic Materials; Fertilizer Made From Recovered Organic Materials;

• Miscellaneous Products: Mats;

• Non-Paper Office Products: Binders, Clipboards, File Folders, Clip Portfolios, and Presentation Folders; Plastic Envelopes; Plastic Trash Bags;

• Paper Products: Paperboard and Packaging;

• Parks and Recreation Products: Playground Surfaces; Running Tracks; and

• Vehicular Products: Re-refined Lubricating Oil.

Federal Government Purchase of Sustainable Products. The Federal government's sustainable purchasing program includes the following three mandatory preference programs for designated products: The BioPreferred Program, the EPA's CPG program, and the Environmentally Preferable Purchasing program. The Council on Environmental Quality (CEQ) and the Office of Management and Budget (OMB) encourage agencies to implement these components comprehensively when purchasing products and services.

Other Federal Preferred Procurement Programs. Federal procurement officials should also note that many biobased products may be available for purchase by Federal agencies through the AbilityOne Program (formerly known as the Javits-Wagner-O'Day (JWOD) program). Under this program, members of organizations including the National Industries for the Blind (NIB) and SourceAmerica (formerly known as the National Industries for the Severely Handicapped) offer products and services for preferred procurement by Federal agencies.

Some biobased products that are categorized in the product categories of adhesives; cleaning tools; clothing; de-icers; durable cutlery; durable tableware; exterior paints and coatings; feminine care products; folders and filing products; gardening supplies and accessories; kitchenware and accessories; other lubricants; rugs and floor mats; and toys and sporting gear could be available for purchase in one or more of the following product categories in the AbilityOne Catalog:

• Cleaning and Janitorial Products,

• Clothing,

• Furniture,

• Hardware and Paints,

• Kitchen and Breakroom Supplies,

• Mailing and Shipping Supplies,

• Office Supplies,

• Outdoor Supplies, and

• Skin and Personal Care.

Because additional categories of products are frequently added to the AbilityOne Program, it is possible that biobased products within other product categories being designated today may be available through the AbilityOne Program in the future. Procurement of biobased products through the AbilityOne Program would further the objectives of both the AbilityOne Program and the Federal preferred procurement program.

Outreach. To augment its own research, USDA consults with industry and Federal stakeholders to the Federal preferred procurement program during the development of the rulemaking packages for the designation of product categories. USDA consults with stakeholders to gather information used in determining the order of product category designation and in identifying the following: Manufacturers producing and marketing products that are categorized within a product category proposed for designation; performance standards used by Federal agencies evaluating products to be procured; and warranty information used by manufacturers of end-user equipment and other products with regard to biobased products.

USDA solicited comments on the proposed rule for 90 days ending on November 13, 2018. USDA received five comments by that date. All of the comments were from manufacturers of biobased products. The comments are presented below, along with USDA's responses, and are shown under the product categories to which they apply.

Comment: Two commenters recommend including an additional sub-category under Concrete Repair Materials that would include products designed to preserve concrete. The commenters note that the two subcategories that were included in the proposed rule, Concrete Repair Materials—Concrete Leveling and Concrete Repair Materials—Concrete Patching, do not take into consideration products that work to preserve the concrete instead of repairing it. The commenters suggest including a third subcategory called “Concrete Repair Materials—Concrete Preservation” that would include products that are designed to protect concrete from further deterioration.

Response: USDA thanks the commenters for their suggestions regarding an additional subcategory for the Concrete Repair Materials category. USDA agrees that Concrete Repair Materials—Concrete Preservation sounds like a reasonable subcategory. However, the commenters have not supplied enough information to designate this additional subcategory at this time. USDA will continue to collect information about concrete preservation products, and a concrete preservation subcategory will be evaluated for inclusion in future rulemaking actions. In the meantime, USDA would like to encourage manufacturers of concrete preservation products who would like to participate in the BioPreferred Program to use the product category “Wood and Concrete Sealers” found in § 3201.42.

Comment: One commenter supports the creation of the Epoxy Systems category and agrees that biobased technologies exist that can provide performance properties that meet market requirements as well as the proposed 23 percent minimum biobased content requirement.

Response: USDA thanks the commenter for their support of the proposed designation of the Epoxy Systems product category.

Comment: One commenter suggests adding performance criteria to the description for this category. The commenter expresses concern that without performance test standards associated with the category, higher performing biobased products with less than 83 percent biobased content would be excluded.

Response: USDA agrees that some exterior paint and coating products may not meet the 83 percent minimum biobased content requirement; however, the data available to USDA show that there are exterior paint and coating products that are capable of meeting the 83 percent minimum. USDA does not generally consider performance criteria when establishing product categories. USDA does give manufacturers an opportunity to provide data on performance criteria as supplemental information when submitting information about their products. While this information is not considered when determining criteria for eligibility to participate in the BioPreferred Program, performance criteria may be taken into consideration when determining the need to establish subcategories. In the future, USDA may add subcategories to the Exterior Paints and Coatings category based on performance criteria if the data support this.

Comment: One commenter believes that the proposed minimum biobased content (23 percent) will be extremely difficult to achieve for fiber-based rugs, runners, and floor mats due to the carpet-like structure of these types of floor coverings. The commenter states that the carpet structure of carpet-based rugs, which does not lend itself to be coated with a backing system with enough biobased formulation to reach the 23 percent biobased content requirement, accounts for 70 percent of the structure of the rug. Thus, the commenter recommends adding language to clarify that carpet-like rugs and floor coverings be included in the previously designated Carpets category rather than in the proposed Rugs and Floor Mats category. The commenter believes that non-fiber-based chair pads or floor mats would not have this issue and would be able to meet the 23 percent biobased content requirement.

Response: USDA reviewed the commenter's suggestions and agreed that it would add clarity to revise the definition. USDA's intent was not to supersede the designated product category “Carpets” (found in § 3201.33) for products composed of woven, tufted, or knitted fiber and a backing system, regardless of whether or not they are wall-to-wall carpet products. USDA has revised the proposed definition to clarify that products that include backing systems would fall under the Carpets category rather than the Rugs and Floor Mats category. Loose fiber, woven rugs or plastic-type floor mats will fall under the Rugs and Floor Mats category.

Comment: One commenter suggests that the category name be changed to “Parking Lot and Road Marking Paints.” The commenter states that while “Traffic and Zone Marking Paints” is common verbiage in the pavement maintenance industry, the phrase does not adequately convey the types of products that might fall into the category to individuals who are not overly familiar with the industry, including federal purchasing agents and specifiers. The commenter believes that changing the category name to “Parking Lot and Road Marking Paints” will make it more obvious to specifiers that biobased alternatives exist for their parking lot and road marking projects. The commenter also suggests changing the minimum biobased content to 32 percent rather than the proposed 30 percent.

Response: USDA agrees that finding a name for a product category that will be familiar to all users of these types of products is difficult. Because “Traffic and Zone Marking Paints” is a common phrase used by those in the industry, and it has been used for the Voluntary Labeling initiative for a significant period of time, USDA believes this is a reasonable name for the category. Although the name of the product category will not be revised, USDA agrees that the definition of the category can be revised to clarify the types of products that are included in this category. To promote awareness of newly designated product categories, USDA prepares “Fact Sheets” describing the new designated categories and their definitions and posts this information on the BioPreferred website so that it is available to federal purchasing agents. Procuring agencies will be able to utilize the information available on the website as one tool to determine and become familiar with the categories of products that are designated for Federal procurement preference, as well as the availability of qualifying biobased products under a designated product category.

USDA did not revise the proposed minimum biobased content for this product category. As discussed in the Preamble to the proposed rule, USDA has biobased content data on five traffic and zone marking paints, and these products have biobased contents ranging from 33 to 38 percent. USDA set the minimum for this category based on the products with tested biobased contents of 33 percent, taking into account the slight imprecision of three percentage points in the ASTM D6866 test method used to measure biobased content.

After consideration of the public comments received in response to the proposed rule, USDA made some changes in the final rule. These changes are summarized below. In the final rule, USDA has revised the definitions of the categories Rugs and Floors Mats and Traffic and Zone Marking Paints. These changes were made to clarify or add examples of the types of products that will be included or excluded in each of these categories. The definition for the Rugs and Floor Mats category has been revised to clarify that products composed of woven, tufted, or knitted fiber and a backing system are excluded from this category as they are already included in the designated product category “Carpets.” The definition for the Traffic and Zone Marking Paints category has been revised to clarify the types of products (and the common usages of these products) that would fall into this category for those who may not be familiar with the traffic and zone marking paint industry.

In addition, USDA has revised the minimum biobased content requirement for the Folders and Filing Products category to account for new data that USDA obtained. After the proposed rule was published, USDA obtained new biobased content data regarding the products upon which the proposed minimum for this category was set. These products were reformulated and now each contain 59 percent biobased content, as measured by ASTM D6866. USDA did not find a reason to exclude either of these products and has determined that it is reasonable to change the minimum biobased content for this category to include these products. Thus, the minimum biobased content for this product category is 56 percent, based on the products with tested biobased content of 59 percent.

Executive Order 12866, as supplemented by Executive Order 13563, requires agencies to determine whether a regulatory action is “significant.” The Order defines a “significant regulatory action” as one that is likely to result in a rule that may: (1) Have an annual effect on the economy of $100 million or more or adversely affect, in a material way, the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the Executive Order.

This final rule has been determined by the Office of Management and Budget to be not significant for purposes of Executive Order 12866. We are not able to quantify the annual economic effect associated with this final rule. USDA attempted to obtain information on the Federal agencies' usage within the proposed new product categories being added and the existing categories being amended. These efforts were largely unsuccessful. Therefore, attempts to determine the economic impacts of this final rule would require estimation of the anticipated market penetration of biobased products based upon many assumptions. In addition, because agencies have the option of not purchasing products within designated product categories if price is “unreasonable,” the product is not readily available, or the product does not demonstrate necessary performance characteristics, certain assumptions may not be valid. While facing these quantitative challenges, USDA relied upon a qualitative assessment to determine the impacts of this final rule.

This final rule is expected to have both positive and negative impacts to individual businesses, including small businesses. USDA anticipates that the Federal preferred procurement program will ultimately provide additional opportunities for businesses and manufacturers to begin supplying products under the proposed designated biobased product categories to Federal agencies and their contractors. However, other businesses and manufacturers that supply only non-qualifying products and do not offer biobased alternatives may experience a decrease in demand from Federal agencies and their contractors. USDA is unable to determine the number of businesses, including small businesses, that may be adversely affected by this final rule. The final rule, however, will not affect existing purchase orders, nor will it preclude businesses from modifying their product lines to meet new requirements for designated biobased products. Because the extent to which procuring agencies will find the performance, availability and/or price of biobased products acceptable is unknown, it is impossible to quantify the actual economic effect of the rule.

The designation of these product categories provides the benefits outlined in the objectives of section 9002: To increase domestic demand for many agricultural commodities that can serve as feedstocks for production of biobased products and to spur development of the industrial base through value-added agricultural processing and manufacturing in rural communities. On a national and regional level, this final rule can result in expanding and strengthening markets for biobased materials used in these product categories.

Like the benefits, the costs of this final rule have not been quantified. Two types of costs are involved: Costs to producers of products that will compete with the preferred products and costs to Federal agencies to provide procurement preference for the preferred products. Producers of competing products may face a decrease in demand for their products to the extent Federal agencies refrain from purchasing their products. However, it is not known to what extent this may occur. Pre-award procurement costs for Federal agencies may rise minimally as the contracting officials conduct market research to evaluate the performance, availability, and price reasonableness of preferred products before making a purchase.

The RFA, 5 U.S.C. 601-602, generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements under the Administrative Procedure Act or any other statute unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small organizations, and small governmental jurisdictions.

USDA evaluated the potential impacts of its proposed designation of these product categories to determine whether its actions would have a significant impact on a substantial number of small entities. Because the Federal preferred procurement program established under section 9002 applies only to Federal agencies and their contractors, small governmental (city, county, etc.) agencies are not affected. Thus, this final rule will not have a significant economic impact on small governmental jurisdictions.

USDA anticipates that this program will affect entities, both large and small, that manufacture or sell biobased products. For example, the designation of product categories for Federal preferred procurement will provide additional opportunities for businesses to manufacture and sell biobased products to Federal agencies and their contractors. Similar opportunities will be provided for entities that supply biobased materials to manufacturers.

The intent of section 9002 is largely to stimulate the production of new biobased products and to energize emerging markets for those products. Because the program continues to evolve, however, it is unknown how many businesses will ultimately be affected. While USDA has no data on the number of small businesses that may choose to develop and market biobased products within the product categories designated by this rulemaking, the number is expected to be small. Because biobased products represent an emerging market for products that are alternatives to traditional products with well-established market shares, only a small percentage of all manufacturers, large or small, are expected to develop and market biobased products. Thus, the number of small businesses manufacturing biobased products affected by this rulemaking is not expected to be substantial.

The Federal preferred procurement program may decrease opportunities for businesses that manufacture or sell non-biobased products or provide components for the manufacturing of such products. Most manufacturers of non-biobased products within the product categories being proposed for designation for Federal preferred procurement in this rule are expected to be included under the following North American Industry Classification System (NAICS) codes:

• 314 Textile Product Mills;

• 3169 Other Leather and Allied Product Manufacturing;

• 32419 Other Petroleum and Coal Products Manufacturing;

• 3255 Paint, Coating, and Adhesive Manufacturing;

• 3256 Soap, Cleaning Compound, and Toilet Preparation Manufacturing;

• 325212 Synthetic Rubber Manufacturing;

• 325998 All Other Miscellaneous Chemical Product and Preparation Manufacturing;

• 325220 Artificial and Synthetic Fibers and Filaments Manufacturing;

• 32611 Plastics Packaging Materials and Unlaminated Film and Sheet Manufacturing;

• 32614 Polystyrene Foam Product Manufacturing;

• 32615 Urethane and Other Foam Product (except Polystyrene) Manufacturing;

• 32616 Plastics Bottle Manufacturing;

• 32619 Other Plastics Product Manufacturing;

• 3262 Rubber Product Manufacturing;

• 3322 Cutlery and Handtool Manufacturing;

• 3324 Boiler, Tank, and Shipping Container Manufacturing;

• 3328 Coating, Engraving, Heat Treating, and Allied Activities;

• 33992 Sporting and Athletic Goods Manufacturing;

• 33993 Doll, Toy, and Game Manufacturing;

• 33994 Office Supplies (except Paper) Manufacturing;

• 339994 Broom, Brush, and Mop Manufacturing; and

• 339999 All Other Miscellaneous Manufacturing.

USDA obtained information on these 24 NAICS categories from the U.S. Census Bureau's Economic Census database. USDA found that in 2012, the Survey of Business Owners data indicate that there were about 42,365 firms with paid employees within these 24 NAICS categories. When considering the 2012 Business Patterns Geography Area Series data in conjunction, these firms owned a total of about 48,532 individual establishments. Thus, the average number of establishments per company is about 1.15. The 2012 Business Patterns Geography Area Series data also reported that of the 48,532 individual establishments, about 48,306 (99.5 percent) had fewer than 500 paid employees. USDA also found that the average number of paid employees per firm among these industries was about 35. Thus, nearly all of the businesses meet the Small Business Administration's definition of a small business (less than 500 employees, in most NAICS categories).

USDA does not have data on the potential adverse impacts on manufacturers of non-biobased products within the product categories being designated by this final rule, but believes that the impact will not be significant. The ratio of the total number of companies with USDA Certified Biobased Products that are categorized in the product categories included in this final rule to the total number of firms with paid employees in each of the NAICS codes listed above is 0.0038. Thus, USDA believes that the number of small businesses manufacturing non-biobased products within these product categories and selling significant quantities of those products to government agencies that would be affected by this rulemaking to be relatively low. Also, this final rule will not affect existing purchase orders, and it will not preclude procuring agencies from continuing to purchase non-biobased products when biobased products do not meet the availability, performance, or reasonable price criteria. This final rule will also not preclude businesses from modifying their product lines to meet new specifications or solicitation requirements for these products containing biobased materials.

After considering the economic impacts of this final rule on small entities, USDA certifies that this action will not have a significant economic impact on a substantial number of small entities.

While not a factor relevant to determining whether the final rule will have a significant impact for RFA purposes, USDA has concluded that the effect of the rule will be to provide positive opportunities for businesses engaged in the manufacture of these biobased products. Purchase and use of these biobased products by procuring agencies increases demand for these products and results in private sector development of new technologies, creating business and employment opportunities that enhance local, regional, and national economies.

This final rule has been reviewed in accordance with Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights, and does not contain policies that would have implications for these rights.

This final rule has been reviewed in accordance with Executive Order 12988, Civil Justice Reform. This final rule does not preempt State or local laws, is not intended to have retroactive effect, and does not involve administrative appeals.

This final rule does not have sufficient federalism implications to warrant the preparation of a Federalism Assessment. Provisions of this final rule will not have a substantial direct effect on States or their political subdivisions or on the distribution of power and responsibilities among the various government levels.

This final rule contains no Federal mandates under the regulatory provisions of Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 1531-1538, for State, local, and tribal governments, or the private sector. Therefore, a statement under section 202 of UMRA is not required.

For the reasons set forth in the final rule related notice for 7 CFR part 3015, subpart V (48 FR 29115, June 24, 1983), this program is excluded from the scope of Executive Order 12372, which requires intergovernmental consultation with State and local officials. This program does not directly affect State and local governments.

This final rule does not significantly or uniquely affect “one or more Indian tribes . . . the relationship between the Federal Government and Indian tribes, or . . . the distribution of power and responsibilities between the Federal Government and Indian tribes.” Thus, no further action is required under Executive Order 13175.

In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 through 3520), the information collection under this final rule is currently approved under OMB control number 0503-0011.

USDA is committed to compliance with the E-Government Act, which requires Government agencies in general to provide the public the option of submitting information or transacting business electronically to the maximum extent possible. USDA is implementing an electronic information system for posting information voluntarily submitted by manufacturers or vendors on the products they intend to offer for Federal preferred procurement under each designated product category. For information pertinent to E-Government Act compliance related to this rule, please contact Karen Zhang at (202) 401-4747.

The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, that includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. USDA has submitted a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register .

For the reasons stated in the preamble, the Department of Agriculture is amending 7 CFR part 3201 as follows:

Discussion

The FAA has received reports of separation between the outer and inner layers of the hose part number (P/N) A785-31. The FAA's investigation shows that, to date, 12 hoses have been inspected and all 12 out of a suspect population of 100 exhibit this condition. The suspect population is traced to a specific manufacturing batch marked by code 1Q18. This condition, if not addressed, could result in blockage of air flow to the engine, engine stoppage, and subsequent loss of control of the helicopter. The FAA is issuing this AD to address the unsafe condition on these products.

In preparation of AD actions such as notices of proposed rulemaking and immediately adopted final rules, it is the practice of the FAA to obtain technical information and information on operational and economic impacts from design approval holders and aircraft operators. The FAA discussed certain aspects of this AD by email and telephone with Robinson. A summary of the discussions can be found in the rulemaking docket. For information on locating the docket, see “Examining the AD Docket.”

The FAA reviewed Robinson R44 Service Bulletin SB-97, dated April 11, 2019 (SB). The SB applies to Robinson Model R44 II helicopters serial numbers (S/N) 14248 through 14286, except 14269, and to any A785-31 hoses shipped as spares from May through November 2018. The SB specifies, within 1 flight hour or prior to further flight if engine roughness or power loss is, or has been encountered, visually inspecting the hose for separation, flexing the hose to listen for a crinkling sound, which is an indication of separation, and replacing any hose that shows indication of separation. The SB also specifies replacing or discarding all affected hoses by June 30, 2019.

The FAA is issuing this AD because the FAA evaluated all the relevant information and determined the unsafe condition described previously is likely to exist or develop in other products of the same type design.

This AD requires, for Robinson R44 II helicopters S/N 14248 through 14268 and 14270 through 14286 or with a hose P/N A785-31 installed after April 30, 2018, within 10 hours time-in-service (TIS), inspecting the inside of the hose for separation between the outer and inner layers, and flexing the hose in all directions while listening for a crinkling sound, which is an indication of separation. If there is any separation or a crinkling sound, this AD requires replacing the hose before further flight. If there is no separation and no crinkling sound, this AD requires replacing the hose within 50 hours TIS. Finally, after the effective date of this AD, installing on any helicopter a hose P/N A785-31 marked with code 1Q18 is prohibited.

The SB specifies corrective action within one flight hour or prior to further flight if engine roughness or power loss is, or has been, encountered. This AD requires corrective action within 10 hours TIS. The compliance times specified in this AD differ from the SB because the FAA determined 10 hours TIS is a reasonable amount of time to comply with the required corrective actions. The SB applies only to those serial-numbered helicopters with an affected hose installed, whereas this AD also applies to helicopters with a hose that has been replaced after April 30, 2018.

Section 553(b)(3) of the Administrative Procedure Act (APA) (5 U.S.C.) authorizes agencies to dispense with notice and comment procedures for rules when the agency, for “good cause,” finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under this section, an agency, upon finding good cause, may issue a final rule without seeking comment prior to the rulemaking.

An unsafe condition exists that requires the immediate adoption of this AD without providing an opportunity for public comments prior to adoption. The FAA has found that the risk to the flying public justifies waiving notice and comment prior to adoption of this rule because corrective actions must be made within 10 hours TIS. Therefore, notice and opportunity for prior public comment are impracticable and contrary to public interest pursuant to 5 U.S.C. 553(b)(3)(B). In addition, for the reasons stated above, the FAA finds that good cause exists pursuant to 5 U.S.C. 553(d) for making this amendment effective in less than 30 days.

This AD is a final rule that involves requirements affecting flight safety and was not preceded by notice and an opportunity for public comment. However, the FAA invites you to send any written data, views, or arguments about this final rule. Send your comments to an address listed under the ADDRESSES section. Include the docket number FAA-2019-0361 and Product Identifier 2019-SW-015-AD at the beginning of your comments. The FAA specifically invites comments on the overall regulatory, economic, environmental, and energy aspects of this final rule. The FAA will consider all comments received by the closing date and may amend this final rule because of those comments.

The FAA will post all comments received, without change, to http://www.regulations.gov, including any personal information you provide. The FAA will also post a report summarizing each substantive verbal contact received about this final rule.

The FAA estimates that this AD may affect up to 88 helicopters of U.S. registry. The FAA estimates the following costs to comply with this AD. Labor costs are estimated at $85 per work-hour. Inspecting the hose takes about 0.5 work-hour and replacing it takes about 0.5 work-hour. Parts cost are about $134 per hose for an estimated cost of $219 per helicopter.

According to Robinson's service information, some of the costs of this AD may be covered under warranty, thereby reducing the cost impact on affected individuals. The FAA does not control warranty coverage for affected individuals. As a result, the FAA has included all costs in the cost estimate.

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.

The FAA is 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.

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

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

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

(2) Will not affect intrastate aviation in Alaska.

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

This rule amends Title 14, Code of Federal Regulations, Part 97 (14 CFR part 97) by amending the referenced SIAPs. The complete regulatory description of each SIAP is listed on the appropriate FAA Form 8260, as modified by the National Flight Data Center (NFDC)/Permanent Notice to Airmen (P-NOTAM), and is incorporated by reference under 5 U.S.C. 552(a), 1 CFR part 51, and 14 CFR 97.20. The large number of SIAPs, their complex nature, and the need for a special format make their verbatim publication in the Federal Register expensive and impractical. Further, airmen do not use the regulatory text of the SIAPs, but refer to their graphic depiction on charts printed by publishers of aeronautical materials. Thus, the advantages of incorporation by reference are realized and publication of the complete description of each SIAP contained on FAA form documents is unnecessary.

This amendment provides the affected CFR sections, and specifies the SIAPs and Takeoff Minimums and ODPs with their applicable effective dates. This amendment also identifies the airport and its location, the procedure and the amendment number.

The material incorporated by reference is publicly available as listed in the ADDRESSES section.

The material incorporated by reference describes SIAPs, Takeoff Minimums and ODPs as identified in the amendatory language for part 97 of this final rule.

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

The SIAPs and Takeoff Minimums and ODPs, as modified by FDC permanent NOTAM, and contained in this amendment are based on the criteria contained in the U.S. Standard for Terminal Instrument Procedures (TERPS). In developing these changes to SIAPs and Takeoff Minimums and ODPs, the TERPS criteria were applied only to specific conditions existing at the affected airports. All SIAP amendments in this rule have been previously issued by the FAA in a FDC NOTAM as an emergency action of immediate flight safety relating directly to published aeronautical charts.

The circumstances that created the need for these SIAP and Takeoff Minimums and ODP amendments require making them effective in less than 30 days.

Because of the close and immediate relationship between these SIAPs, Takeoff Minimums and ODPs, and safety in air commerce, I find that notice and public procedure under 5 U.S.C. 553(b) are impracticable and contrary to the public interest and, where applicable, under 5 U.S.C. 553(d), good cause exists for making these SIAPs effective in less than 30 days.

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

Accordingly, pursuant to the authority delegated to me, Title 14, Code of Federal regulations, Part 97, (14 CFR part 97), is amended by amending Standard Instrument Approach Procedures and Takeoff Minimums and ODPs, effective at 0901 UTC on the dates specified, as follows:

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

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

The material incorporated by reference is publicly available as listed in the ADDRESSES section.

The material incorporated by reference describes SIAPS, Takeoff Minimums and/or ODPS as identified in the amendatory language for part 97 of this final rule.

This amendment to 14 CFR part 97 is effective upon publication of each separate SIAP, Takeoff Minimums and ODP as Amended in the transmittal. Some SIAP and Takeoff Minimums and textual ODP amendments may have been issued previously by the FAA in a Flight Data Center (FDC) Notice to Airmen (NOTAM) as an emergency action of immediate flight safety relating directly to published aeronautical charts.

The circumstances that created the need for some SIAP and Takeoff Minimums and ODP amendments may require making them effective in less than 30 days. For the remaining SIAPs and Takeoff Minimums and ODPs, an effective date at least 30 days after publication is provided.

Further, the SIAPs and Takeoff Minimums and ODPs contained in this amendment are based on the criteria contained in the U.S. Standard for Terminal Instrument Procedures (TERPS). In developing these SIAPs and Takeoff Minimums and ODPs, the TERPS criteria were applied to the conditions existing or anticipated at the affected airports. Because of the close and immediate relationship between these SIAPs, Takeoff Minimums and ODPs, and safety in air commerce, I find that notice and public procedure under 5 U.S.C. 553(b) are impracticable and contrary to the public interest and, where applicable, under 5 U.S.C. 553(d), good cause exists for making some SIAPs effective in less than 30 days.

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

Accordingly, pursuant to the authority delegated to me, Title 14, Code of Federal Regulations, Part 97 (14 CFR part 97) is amended by establishing, amending, suspending, or removing Standard Instrument Approach Procedures and/or Takeoff Minimums and Obstacle Departure Procedures effective at 0901 UTC on the dates specified, as follows:

This rule amends Title 14, Code of Federal Regulations, Part 97 (14 CFR part 97) by amending the referenced SIAPs. The complete regulatory description of each SIAP is listed on the appropriate FAA Form 8260, as modified by the National Flight Data Center (NFDC)/Permanent Notice to Airmen (P-NOTAM), and is incorporated by reference under 5 U.S.C. 552(a), 1 CFR part 51, and 14 CFR 97.20. The large number of SIAPs, their complex nature, and the need for a special format make their verbatim publication in the Federal Register expensive and impractical. Further, airmen do not use the regulatory text of the SIAPs, but refer to their graphic depiction on charts printed by publishers of aeronautical materials. Thus, the advantages of incorporation by reference are realized and publication of the complete description of each SIAP contained on FAA form documents is unnecessary.

This amendment provides the affected CFR sections, and specifies the SIAPs and Takeoff Minimums and ODPs with their applicable effective dates. This amendment also identifies the airport and its location, the procedure and the amendment number.

The material incorporated by reference is publicly available as listed in the ADDRESSES section.

The material incorporated by reference describes SIAPs, Takeoff Minimums and ODPs as identified in the amendatory language for part 97 of this final rule.

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

The SIAPs and Takeoff Minimums and ODPs, as modified by FDC permanent NOTAM, and contained in this amendment are based on the criteria contained in the U.S. Standard for Terminal Instrument Procedures (TERPS). In developing these changes to SIAPs and Takeoff Minimums and ODPs, the TERPS criteria were applied only to specific conditions existing at the affected airports. All SIAP amendments in this rule have been previously issued by the FAA in a FDC NOTAM as an emergency action of immediate flight safety relating directly to published aeronautical charts.

The circumstances that created the need for these SIAP and Takeoff Minimums and ODP amendments require making them effective in less than 30 days.

Because of the close and immediate relationship between these SIAPs, Takeoff Minimums and ODPs, and safety in air commerce, I find that notice and public procedure under 5 U.S.C. 553(b) are impracticable and contrary to the public interest and, where applicable, under 5 U.S.C. 553(d), good cause exists for making these SIAPs effective in less than 30 days.

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

Accordingly, pursuant to the authority delegated to me, Title 14, Code of Federal regulations, Part 97, (14 CFR part 97), is amended by amending Standard Instrument Approach Procedures and Takeoff Minimums and ODPs, effective at 0901 UTC on the dates specified, as follows:

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

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

The material incorporated by reference is publicly available as listed in the ADDRESSES section.

The material incorporated by reference describes SIAPS, Takeoff Minimums and/or ODPS as identified in the amendatory language for part 97 of this final rule.

This amendment to 14 CFR part 97 is effective upon publication of each separate SIAP, Takeoff Minimums and ODP as Amended in the transmittal. Some SIAP and Takeoff Minimums and textual ODP amendments may have been issued previously by the FAA in a Flight Data Center (FDC) Notice to Airmen (NOTAM) as an emergency action of immediate flight safety relating directly to published aeronautical charts.

The circumstances that created the need for some SIAP and Takeoff Minimums and ODP amendments may require making them effective in less than 30 days. For the remaining SIAPs and Takeoff Minimums and ODPs, an effective date at least 30 days after publication is provided.

Further, the SIAPs and Takeoff Minimums and ODPs contained in this amendment are based on the criteria contained in the U.S. Standard for Terminal Instrument Procedures (TERPS). In developing these SIAPs and Takeoff Minimums and ODPs, the TERPS criteria were applied to the conditions existing or anticipated at the affected airports. Because of the close and immediate relationship between these SIAPs, Takeoff Minimums and ODPs, and safety in air commerce, I find that notice and public procedure under 5 U.S.C. 553(b) are impracticable and contrary to the public interest and, where applicable, under 5 U.S.C. 553(d), good cause exists for making some SIAPs effective in less than 30 days.

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

Accordingly, pursuant to the authority delegated to me, Title 14, Code of Federal Regulations, Part 97 (14 CFR part 97) is amended by establishing, amending, suspending, or removing Standard Instrument Approach Procedures and/or Takeoff Minimums and Obstacle Departure Procedures effective at 0901 UTC on the dates specified, as follows:

We are adopting amendments to 17 CFR 210.2-01 (“Rule 2-01 of Regulation S-X”).

The Commission's auditor independence standard set forth in Rule 2-01 of Regulation S-X requires auditors  1 to be independent of their audit clients both “in fact and in appearance.”  2 Rule 2-01(b) provides that the Commission will not recognize an accountant as independent with respect to an audit client if the accountant is not (or if a reasonable investor with knowledge of all relevant facts and circumstances would conclude that the accountant is not) capable of exercising objective and impartial judgment on all issues encompassed within the accountant's engagement. 3 Furthermore, in determining whether an accountant is independent, the Commission will consider all relevant circumstances, including all relationships between an accountant and the audit client. 4

Rule 2-01(c) sets forth a nonexclusive list of circumstances that the Commission considers to be inconsistent with the independence standard in Rule 2-01(b), including certain direct financial relationships between an accountant and audit client and other circumstances where the accountant has a financial interest in the audit client. 5 In particular, the existing restriction on debtor-creditor relationships in Rule 2-01(c)(1)(ii)(A) (the “Loan Provision”) generally provides that an accountant is not independent when (a) the accounting firm, (b) any covered person  6 in the accounting firm ( e.g., the audit engagement team and those in the chain of command), or (c) any of the covered person's immediate family members has any loan (including any margin loan) to or from (x) an audit client, or (y) an audit client's officers, directors, or (z) record or beneficial owners of more than 10 percent of the audit client's equity securities. 7 Simply because a lender to an auditor holds 10 percent or less of an audit client's equity securities does not, in itself, establish that the auditor is independent under Rule 2-01 of Regulation S-X. The general standard under Rule 2-01(b) and the remainder of Rule 2-01(c) still apply to auditors and their audit clients regardless of the applicability of the Loan Provision.

In the below illustration, pursuant to the Loan Provision, a lending relationship between any entity in the left hand column and any entity in the right-hand column impairs independence, unless an exception applies.

When the Commission proposed the Loan Provision in 2000, it noted that a debtor-creditor relationship between an auditor and its audit client reasonably could be viewed as “creating a self-interest that competes with the auditor's obligation to serve only investors' interests.”  8 The Commission's concern about a competing self-interest extended beyond loans directly between the auditor and its audit client to loans between the auditor and those shareholders of the audit client who have a “special and influential role” with the audit client. 9 As a proxy for identifying a “special and influential role,” the Commission adopted a bright-line test for loans to or from a record or beneficial owner of more than 10 percent of an audit client's equity securities. 10

Under Rule 2-01(f)(6) of Regulation S-X, the term “audit client” is defined to include any affiliate of the entity whose financial statements are being audited. 11 Rule 2-01(f)(4) provides that “affiliates of the audit client” include entities that control, are controlled by, or are under common control with the audit client. 12 As a result, generally, an accounting firm is not independent under the Loan Provision if it has a lending relationship with an entity having record or beneficial ownership of more than 10 percent of the equity securities of either (a) the firm's audit client; or (b) any entity that is a controlling parent company of the audit client, a controlled subsidiary of the audit client, or an entity under common control with the audit client.

In addition, the term “affiliate of the audit client” includes each entity in an investment company complex (“ICC”) of which the audit client is a part. 13 Accordingly, in the ICC context, an accounting firm is considered not independent under the Loan Provision if it has a lending relationship with an entity having record or beneficial ownership of more than 10 percent of any entity within the ICC, regardless of which entities in the ICC are audited by the accounting firm.

The Commission has become aware that, in certain circumstances, the existing Loan Provision may not be functioning as it was intended. Registered investment companies, other pooled investment vehicles, and registered investment advisers have expressed concerns about the Loan Provision in both public disclosures and, together with their auditors, in extensive consultations with Commission staff. 14 It has become clear that there are certain fact patterns in which an auditor's objectivity and impartiality are not impaired despite a failure to comply with the requirements of the Loan Provision. These fact patterns have arisen most frequently with respect to funds, although as noted in the Proposing Release, non-fund issuers also have faced challenges associated with the Loan Provision. 15

The Commission understands that accounting firms use loans to help finance their core business operations. Accounting firms frequently obtain financing to pay for their labor and out-of-pocket expenses before they receive payments from audit clients for those services. Accounting firms also use financing to fund current operations and provide capital to fund ongoing investments in their audit methodologies and technology. Accounting firms borrow from commercial banks or through private placement debt issuances, typically purchased by large financial institutions, both of which give rise to debtor-creditor relationships. 16 For creditor diversification purposes, credit facilities provided or arranged by commercial banks are often syndicated among multiple financial institutions, thereby expanding the number of lenders to an accounting firm. As a result, accounting firms typically have a wide array of borrowing arrangements. These arrangements facilitate firms' provision of audit services to investors and other market participants, but also multiply the number of lenders that may be record or beneficial owners of securities in audit clients and that must be analyzed under the Loan Provision.

These accounting firms' financing methods appear to have resulted in various scenarios in which the Loan Provision deems an accounting firm's independence to be impaired, notwithstanding that the relevant facts and circumstances regarding the relationships between the auditor and the audit client suggest that in most cases the auditor's objectivity and impartiality do not appear to be affected as a practical matter. Nevertheless, auditors and audit committees  17 may feel obligated to devote substantial resources to evaluating potential instances of non-compliance with the existing Loan Provision, which could distract auditors' and audit committees' attention from matters that may be more likely to bear on the auditor's objectivity and impartiality. 18 Audit committees' receipt of a high volume of communications of such relationships could dilute the impact of communications that identify issues that may actually raise concerns about an auditor's independence.

Similarly, numerous violations of the independence rules that no reasonable investor would view as implicating an auditor's objectivity and impartiality could desensitize market participants to other, more significant violations of the independence rules. Respect for the seriousness of these obligations, and attention to any breach or potential breach of these obligations, is better fostered through limiting violations to those instances in which the auditor's independence would be impaired in fact or in appearance.

Moreover, searching for, identifying, and assessing non-compliance or potential non-compliance with the Loan Provision and reporting these instances to audit committees also may generate significant costs for entities and their advisers and auditors, which are ultimately borne by shareholders. These costs are unlikely to have corresponding benefits to the extent that the Loan Provision's breadth identifies and requires analysis of circumstances that are unlikely to bear on the auditor's independence.

In addition, the compliance challenges associated with the Loan Provision can have broader disruptive effects, particularly for funds. 19 For example, in order for a registered open-end fund to make a continuous offering of its securities, it must maintain a current prospectus by periodically filing post-effective amendments to its registration statement that contain updated financial information audited by an independent public accountant in accordance with Regulation S-X. 20 In addition, the federal securities laws require that investment companies registered under the Investment Company Act transmit annually to shareholders and file with the Commission financial statements audited by an independent registered public accounting firm. 21 Accordingly, non-compliance with the auditor independence rules in some cases could result in affected funds not being able to offer or sell shares, investors not being able to rely on affected financial statements, or funds (and, indirectly, but importantly, their investors) having to incur the costs of re-audits.

In order to provide time for the Commission to address these challenges, and recognizing that funds and their advisers were most acutely affected by the Loan Provision, the Commission staff issued a no-action letter to Fidelity Management & Research Company in 2016 regarding the application of the Loan Provision (“Fidelity No-Action Letter”). 22 In the Fidelity No-Action Letter, the staff stated that it would not recommend enforcement action to the Commission, even though certain Fidelity entities identified in the letter used audit firms that were not in compliance with the Loan Provision, subject to certain conditions specified in the letter ( e.g., that notwithstanding such non-compliance, the audit firm had concluded that it is objective and impartial with respect to the issues encompassed within the engagement). 23 Staff has continued to receive inquiries from registrants and accounting firms regarding the application of the Loan Provision, clarification of the Fidelity No-Action Letter, and requests for consultation regarding issues not covered in the Fidelity No-Action Letter.

In order to address the compliance challenges discussed above, on May 2, 2018, the Commission proposed amendments to its auditor independence rules to refocus the analysis that must be conducted to determine whether an auditor is independent when the auditor has a lending relationship with certain shareholders of an audit client at any time during an audit or professional engagement period. 24 The proposed amendments to the Loan Provision were intended to more effectively identify debtor-creditor relationships that could impair an auditor's objectivity and impartiality, as opposed to certain more attenuated relationships that are unlikely to present threats to objectivity or impartiality. To achieve this objective, the proposed amendments to the Loan Provision would have: (1) Focused the analysis solely on beneficial ownership rather than on both record and beneficial ownership; (2) replaced the existing 10 percent bright-line shareholder ownership test with a “significant influence” test; (3) added a “known through reasonable inquiry” standard with respect to identifying beneficial owners of the audit client's equity securities; and (4) amended the definition of “audit client” for a fund under audit to exclude funds that otherwise would be considered affiliates of the audit client. The Commission also requested comment on certain other potential amendments to its auditor independence rules.

In developing the final amendments, we considered the thirty-one comment letters received in response to the Proposing Release. 25 Most commenters expressed general support for the proposed amendments, and only a few commenters did not.

We are adopting amendments to Rule 2-01 of Regulation S-X that we believe would more effectively identify those debtor-creditor relationships that could impair an auditor's objectivity and impartiality, yet would not include certain attenuated relationships that are unlikely to present threats to objectivity or impartiality. 26 Because compliance challenges associated with applying the Loan Provision have arisen with entities other than funds, and given that we did not receive comments objecting to our proposal to apply these amendments broadly, the final amendments will apply to entities beyond the investment management industry, including operating companies and registered broker-dealers.

We are adopting the amendments generally as proposed with a few additional changes. As was proposed, we are focusing the analysis on beneficial ownership rather than on both record and beneficial ownership. Also, as proposed, we are replacing the existing 10 percent bright-line shareholder ownership test with a “significant influence” test and adding a “known through reasonable inquiry” standard with respect to identifying beneficial owners of the audit client's equity securities. In addition, we are excluding from the definition of “audit client,” for a fund under audit, any other funds that otherwise would be considered affiliates of the audit client under the Loan Provision. In a change from the proposal and in response to comments, the final amendments define “fund” for these purposes to also exclude commodity pools and we clarify that foreign funds (as described below) are excluded for purposes of the definition of audit client. Finally, the Chairman has directed the staff to formulate recommendations to the Commission for possible additional changes to the auditor independence rules, as discussed further below.

Where a lender to an auditor holds more than 10 percent of the equity securities of that auditor's audit client either as a beneficial owner or as a record owner, current rules dictate that the auditor is not independent of the audit client. As noted in the Proposing Release, one challenge associated with the Loan Provision is that it applies to both “record” and “beneficial” owners of the audit client's equity securities. However, publicly traded shares, as well as certain fund shares, often are registered in the name of a relatively small number of financial intermediaries  27 as “record” owners for the benefit of their clients or customers. Certain of these financial intermediaries may also be lenders to public accounting firms or be affiliated with financial institutions that may be lenders to public accounting firms. As a result, audit clients may have financial intermediaries that own, on a “record” basis, more than 10 percent of the issuer's shares and are also lenders to public accounting firms, covered persons of accounting firms, and their immediate family members, or are affiliated with companies that are lenders to public accounting firms (see Figure 2 below for illustration). However, these financial intermediaries are not “beneficial” owners and may not have control over whether they are “record” owners of more than 10 percent of the issuer's shares.

For example, open-end funds, such as mutual funds, may face significant challenges, because the record ownership percentages of open-end funds may fluctuate greatly within a given period for reasons completely out of the control or knowledge of a lender who is also a fund shareholder of record, regardless of their diligence in monitoring compliance. Specifically, as a result of underlying customer activity in an omnibus account (such as when beneficial owners purchase or redeem their shares in an open-end fund) or as a result of the activity of other record or beneficial owners, the record ownership of a lender that is a financial intermediary holding fund shares for customers may exceed, or conversely fall below, the 10 percent threshold within a given period without any affirmative action on the part of the financial intermediary. 28 In this scenario, the financial intermediary's holdings might constitute less than 10 percent of a mutual fund and, as a result of subsequent redemptions by beneficial owners through other non-affiliated financial intermediaries, the same investment could then constitute more than 10 percent of the mutual fund. However, regardless of their diligence in monitoring compliance, the financial intermediary, the fund, and the auditor may not know that the 10 percent threshold had been exceeded until after the fact.

Under the proposed amendments, the Loan Provision would apply only to beneficial owners of the audit client's equity securities and not to those who merely hold the audit client's equity securities as a holder of record on behalf of their beneficial owners. 29 The Proposing Release noted that tailoring the Loan Provision to focus on the beneficial ownership of the audit client's equity securities would more effectively identify shareholders “having a special and influential role with the issuer” and therefore better capture those debtor-creditor relationships that may impair an auditor's independence. 30

Commenters generally supported the proposed amendment to focus the analysis on beneficial owners, 31 and several of these commenters agreed that tailoring the Loan Provision to focus only on the beneficial ownership of the audit client's equity securities would more effectively identify shareholders “having a special and influential role with the issuer” and therefore better capture those debtor-creditor relationships that may impair an auditor's independence. 32 One commenter expressed the view that auditors should not have any lending relationship with any shareholders of an audit client. 33 Several commenters requested clarification of the definition of “beneficial owner” and expressed support for defining “beneficial owner” to refer to those owners with an economic interest in the relevant securities. 34 A number of commenters requested that the Commission reiterate the guidance set forth in footnote 22 of the Proposing Release, 35 describing the entities that are excluded from the scope of the Loan Provision ( e.g., entities that are under common control with or controlled by the beneficial owner are excluded from the scope). 36

A few commenters agreed that the proposed amendment would ease compliance burdens, 37 and two commenters stated that the proposed amendment did not raise other auditor independence concerns. 38 Two commenters expressed the view that, even if the Commission amended the Loan Provision to provide for evaluation of beneficial ownership alone, the other proposed amendments would still be necessary and appropriate. 39

After considering the comments received, and consistent with the proposal, we are adopting amendments that focus the analysis on beneficial ownership rather than on both record and beneficial ownership. We continue to believe that tailoring the Loan Provision to focus on the beneficial ownership of the audit client's equity securities would more effectively identify shareholders “having a special and influential role with the issuer” and therefore better capture those debtor-creditor relationships that may impair an auditor's independence.

In response to commenters who requested clarification of the term “beneficial owner,” we are providing additional guidance that financial intermediaries, who hold shares as record owners, and who have limited authority to make or direct voting or investment decisions on behalf of the underlying shareholders of the audit clients, are not considered “beneficial owners” for purposes of the Loan Provision. 40 Furthermore, if the financial intermediary undertakes steps to remove its discretion over the voting or disposition of shares, the financial intermediary generally will not be considered to be a beneficial owner for purposes of the Loan Provision. Such steps could include, for example: (1) Mirror voting ( i.e., the intermediary is obligated to vote the shares held by it in the same proportion as the vote of all other shareholders); (2) the financial intermediary holds the shares in an irrevocable voting trust without discretion for the institution to vote the shares; (3) an agreement to pass through the voting rights to an unaffiliated third-party entity; or (4) the intermediary has otherwise relinquished its right to vote such shares. 41 As requested by commenters, we also are reiterating the guidance set forth in the Proposing Release, 42 but with certain conforming changes because the final amendments remove the reference to “record owners” from the Loan Provision and replace the 10 percent bright-line test with a significant influence test. 43 Accordingly, entities that are under common control with or controlled by the beneficial owner of the audit client's equity securities when such beneficial owner has significant influence over the audit client, are excluded from the scope of the Loan Provision.

As discussed in the Proposing Release, the current bright-line 10 percent test may be both over- and under-inclusive as a means of identifying those debtor-creditor relationships that actually impair the auditor's objectivity and impartiality. For example, the existing Loan Provision may apply even in situations where the lender may be unable to influence the audit client through its holdings (such as with omnibus accounts that hold as record owner more than 10 percent of the equity shares of an audit client). In such circumstances, the lender's ownership of an audit client's equity securities alone would not threaten an audit firm's objectivity and impartiality. Conversely, the existing Loan Provision does not apply if the auditor's lender owns 10 percent or less of the audit client's equity securities, despite the fact that such an owner may be able to exert significant influence over the audit client through contractual or other means. A holder of 10 percent or less of an audit client's equity securities could, for example, have the contractual right to remove or replace a pooled investment vehicle's investment adviser.

The Commission proposed to replace the existing 10 percent bright-line test in the Loan Provision with a “significant influence” test similar to that referenced in other parts of the Commission's auditor independence rules. 44 Specifically, the proposed amendment would provide, in part, that an accountant would not be independent when the accounting firm, any covered person in the firm, or any of his or her immediate family members has any loan (including any margin loan) to or from an audit client, or an audit client's officers, directors, or beneficial owners (known through reasonable inquiry) of the audit client's equity securities where such beneficial owner has significant influence over the audit client. 45 Although not specifically defined, the term “significant influence” appears in other parts of Rule 2-01 of Regulation S-X, 46 and the Proposing Release noted that use of the term “significant influence” in the proposed amendment was intended to refer to the principles in the Financial Accounting Standards Board's (“FASB's”) ASC Topic 323, Investments—Equity Method and Joint Ventures. 47

Most commenters supported the proposed amendment to replace the 10 percent bright-line shareholder ownership test with a significant influence test. 48 Generally, these commenters agreed that significant influence is a more appropriate framework to identify those lending relationships that impair an accountant's objectivity and impartiality. 49 A few commenters supported codifying the significant influence test found in ASC 323 (or specific elements of that test) in our rules to promote consistent application, 50 but one commenter did not support codification in our rules so as to avoid confusion in the future if changes are made to ASC 323. 51 A few commenters requested that we affirm that the Commission's auditor independence standards involve a shared responsibility of the audit client and the auditor. 52 One commenter did not support replacing the 10 percent bright-line test with a significant influence test in part because the commenter questioned the quality of the equity method of accounting in general. 53

Many commenters agreed that the framework in ASC 323 is generally appropriate for assessing significant influence. 54 Several commenters, however, asserted that the concepts in ASC 323 may not be useful to apply to funds or may not be routinely applied in the fund context. 55 Two commenters asserted that ASC 323 is not an appropriate framework for the “significant influence” test, and instead proposed a decision framework with a “singular focus on the beneficial owner's ability to exert significant influence over the audit client's operating and financial policies,” based on the totality of the facts and circumstances. 56 A number of commenters requested that the Commission reiterate the fund guidance from the Proposing Release, 57 which clarified that in the fund context, the operating and financial policies relevant to the significant influence test would include the fund's portfolio management processes. A few commenters recommended that the Commission provide additional guidance regarding the application of the significant influence test in the fund context ( e.g., mutual funds, preferred stockholders in closed-end funds, and exchange-traded funds). 58

Several commenters agreed that it would be appropriate to consider the nature of the services provided by the investment adviser as a factor in determining whether a beneficial owner has significant influence. 59 Several commenters also supported analyzing the concept of “portfolio management processes” as the first step to the significant influence test for investment companies. These commenters agreed that, in circumstances in which the advisory contract grants the investment adviser significant discretion with respect to the fund's portfolio management processes, it is unlikely that a shareholder will have significant influence and the factors in ASC 323 would not have to be further analyzed. 60 Some commenters recommended that the Commission confirm that an audit firm need not monitor beneficial ownership if it initially determines that, based on portfolio management processes, the audit client cannot be subject to significant influence and periodically determines that there are no changes to the fund's governance structure and governing documents. 61 Two commenters proposed a framework that focused on the beneficial owner's ability to exert significant influence over the audit client's operating and financial policies, based on the totality of the circumstances, and to avoid the exclusive reliance on the ASC 323 framework in the investment fund context. 62

ASC 323 incorporates a rebuttable presumption of significant influence once beneficial ownership meets or exceeds 20 percent of an investee's voting securities. 63 Two commenters recommended codifying the rebuttable presumption assessment under the proposed significant influence test consistent with the accounting standard, 64 and one commenter stated that although ASC 323 includes a rebuttable presumption with respect to 20 percent ownership, it is merely a guide and may be raised or lowered depending on the facts and circumstances. 65 A few commenters did not support applying the 20 percent rebuttable presumption to funds, but rather supported an analysis of the rights of fund owners under the fund's governance provisions. 66 Two commenters viewed the 20 percent rebuttable presumption as substituting a new 20 percent bright-line test for the existing 10 percent bright-line test, in the absence of the fund guidance set forth in the Proposing Release. 67 One commenter was concerned that the 20 percent rebuttable presumption could potentially conflict with the analysis of “control” under the federal securities laws by introducing a new standard that could increase compliance costs. 68

The Proposing Release noted that if a shareholder in a private fund, for example, has a side letter agreement outside of the standard partnership agreement that allows for participation in portfolio management processes (including participation on a fund advisory committee), then the shareholder would likely have significant influence. 69 A few commenters asserted that although participation on an advisory committee should be one factor in assessing significant influence, this factor alone is not likely to indicate significant influence. 70 Two commenters noted that the responsibilities of an advisory committee can vary. 71 One of these commenters noted that, when the board or advisory committee has substantive oversight responsibility or decision-making capacity over operating and financial policies significant to the fund, the commenter would likely view a shareholder on the board or advisory committee as having significant influence. In the absence of those characteristics, the commenter indicated that it would likely not consider a member of the board or advisory committee to have significant influence. 72 The other commenter stated that the purpose of an advisory committee generally is to provide suggestions to the investment adviser or general partner, and that advisory committees typically do not oversee the investment adviser or general partner and do not participate in the portfolio management process. 73

Two commenters asserted that the right to remove a general partner or adviser was unlikely to indicate significant influence. 74 Another commenter supported drawing a distinction between rights that provide a shareholder with an ability to actively participate in fund investment decisions ( e.g., approval or veto rights over a new fund investment), which would indicate significant influence, and rights that allow a shareholder to address inappropriate behavior on the part of the investment adviser ( e.g., a right to remove an adviser for cause or the right to approve material changes to the fund governance documents), which would not indicate significant influence. 75

Authorized participants (“APs”) for ETFs deposit or receive basket assets in exchange for creation units of the fund. The Proposing Release noted that the deposit or receipt of basket assets by an AP that is also a lender to the auditor alone would not constitute significant influence over an ETF audit client. Several commenters agreed that the deposit or receipt of basket assets by an authorized participant that is also a lender to the auditor would not alone constitute significant influence over an ETF audit client. 76 A few commenters stated that market makers also should not be considered to have significant influence over an ETF audit client since their objective is not to influence the fund or the portfolio management process, but to provide liquidity to ETFs. 77 One commenter recommended that the Commission clarify that market makers typically would not be considered to have significant influence for purposes of the Loan Provision. 78

The Proposing Release indicated that, if the auditor determines that significant influence does not exist based on the facts and circumstances at the time of the auditor's initial evaluation, 79 the auditor should monitor the Loan Provision on an ongoing basis, which could be done, for example, by reevaluating its determination when there is a material change in the fund's governance structure and governing documents, publicly available information about beneficial owners, or other information that may implicate the ability of a beneficial owner to exert significant influence of which the audit client or auditor becomes aware. Several commenters agreed with this proposal. 80 A few commenters indicated that communications with shareholders or documentation regarding investor rights could be examples of other information implicating significant influence of which the audit client or auditor becomes aware. 81

The Proposing Release also requested comment on whether the Commission should permit the Loan Provision or other financial relationships to be addressed at specific dates during the audit and professional engagement period, or the beginnings or ends of specific periods, or under specified circumstances. Rule 2-01(c)(1) of Regulation S-X provides that an accountant is not independent if the accountant has an independence-impairing relationship specified in the rule at any point during the audit and professional engagement period. Certain existing disclosure requirements require information about beneficial owners as of a specified date. 82 Several commenters expressed the view that specific dates were not needed to assess compliance with the Loan Provision, and that the frequency and timing of the evaluation should be developed based on the particular facts and circumstances relevant to the audited entity. 83

A few commenters supported including specific dates or periods, such as:

• The onset of the engagement period and the balance sheet date for each audit;  84

• At the planning and reporting stages of the audit and potentially significant or material events;  85 or

• The beginning of the engagement, prior to accepting a new engagement, and when the governance structure (including any contractual relationships) of the audit client changes. 86

Two commenters proposed alternatives to the significant influence test: (1) Focusing on material direct financial interests, 87 and (2) focusing the analysis on beneficial ownership, but maintaining the existing 10 percent bright-line shareholder ownership test. 88 The commenter that recommended maintaining the existing 10 percent bright-line ownership test but applying it to beneficial owners argued that this alternative approach would be simpler and easier to understand than the proposed significant influence test. 89 This commenter also asserted that the alternative approach would address most of the issues raised in the Fidelity No-Action Letter and avoid replacing the 10 percent bright-line test with a significant influence test that incorporates a 20% rebuttable presumption. 90

One commenter stated that alternatives to the significant influence test are not needed. 91 The Proposing Release also requested comment on whether the modifier “significant” should be removed, such that the test would hinge on whether a lender shareholder has influence over an audit client. Two commenters opposed the removal of the modifier “significant” from the significant influence test, arguing that it would not achieve the objective of more effectively identifying those lending relationships that impair objectivity and impartiality. 92 Another commenter did not support an alternative test based on mere “influence,” describing significant influence as being able to alter management's decision-making process, whereas mere “influence” could be disregarded by management. 93

After carefully considering the comments received, and consistent with the proposal, we are adopting amendments to replace the existing 10 percent bright-line test in the Loan Provision with a “significant influence” test similar to that referenced in other parts of the Commission's auditor independence rules and based on the concepts applied in ASC 323. We are not adopting an alternative framework, as suggested by two commenters, 94 that focuses on the beneficial owner's ability to exert significant influence over the audit client's operating and financial policies, based on the totality of the facts and circumstances, rather than the concepts applied in ASC 323. We continue to believe that given its use in other parts of the Commission's independence rules, 95 the concept of “significant influence” is one with which audit firms and their clients are already required to be familiar and would effectively identify those debtor-creditor relationships that could impair an auditor's objectivity and impartiality. In this regard, introducing a separate significant influence determination for these purposes would introduce additional complexity to the auditor independence rules without, in our view, necessarily resulting in more accurate assessments of auditor independence.

While the term “significant influence” in the final amendment refers to the principles in ASC 323, we agree with the commenter who stated that the specific considerations described in the significant influence test in ASC 323 should not be codified in our rules so as to avoid confusion in the future if changes are made to ASC 323. 96 For similar reasons, we are not codifying ASC 323's 20 percent rebuttable presumption in our rules.

While audit firms and audit committees of operating companies already should be familiar with application of the “significant influence” concept, we appreciate that this concept is not as routinely applied by funds for financial reporting purposes. Therefore, in response to comments requesting that the Commission reiterate the fund guidance from the Proposing Release  97 and comments recommending additional guidance regarding the application of the significant influence test in the fund context, 98 we are reiterating the fund guidance in the Proposing Release, with further clarification about the application in this context of the rebuttable presumption and other fund specific issues. In the fund context, we believe that the operating and financial policies relevant to the significant influence test would include the fund's investment policies and day-to-day portfolio management processes, including those governing the selection, purchase and sale, and valuation of investments, and the distribution of income and capital gains (collectively “portfolio management processes”). An audit firm could analyze, in its initial assessment under the rule, whether significant influence over the fund's portfolio management processes exists based on an evaluation of the fund's governance structure and governing documents, the manner in which its shares are held or distributed, and any contractual arrangements, among any other relevant factors.

We believe that it would be appropriate to consider the nature of the services provided by the fund's investment adviser(s) pursuant to the terms of an advisory contract with the fund as part of this analysis. In circumstances where the terms of the advisory agreement grant the adviser significant discretion with respect to the fund's portfolio management processes and the shareholder does not have the ability to influence those portfolio management processes, significant influence generally would not exist and the evaluation of significant influence would be complete unless there is a material change in the fund's governance structure and governing documents (as discussed below). This should be the case even if the shareholder holds 20 percent or more of a fund's equity securities, which would otherwise trigger the rebuttable presumption under application of the concepts described in ASC 323.

The ability to vote on the approval of a fund's advisory contract or a fund's fundamental policies on a pro rata basis with all holders of the fund alone generally should not lead to the determination that a shareholder has significant influence. Similarly, the ability to remove or terminate a fund's advisory contract alone generally should not lead to a determination that a shareholder has significant influence.

As the Commission observed in the Proposing Release, if a shareholder in a private fund, for example, has a side letter agreement outside of the standard partnership agreement that allows for participation in portfolio management processes (including participation on a fund advisory committee), then the shareholder would likely have significant influence. In response to commenters noting that the responsibilities of an advisory committee can vary, 99 we are further clarifying that a shareholder in a private fund that participates on a fund advisory committee would likely have significant influence if that committee involves substantive oversight responsibility or decision-making capacity over operating and financial policies significant to the fund.

In addition, we believe that the deposit or receipt of basket assets by an AP that is also a lender to the auditor would not alone constitute significant influence over an ETF audit client. Similarly, in circumstances where a market maker is a lender to the auditor, the deposit or receipt of basket assets by a market maker (acting through an AP) would not alone constitute significant influence over such an ETF audit client.

Holders of a closed-end fund's preferred stock have certain rights that may be relevant to a significant influence analysis. 100 The determination of whether preferred stockholders have significant influence over the fund would be based on an evaluation of the relevant facts and circumstances.

Further to the guidance set forth above, we wish to emphasize that auditor independence is a shared responsibility between the audit firm and audit client. 101 The reliability of the process for identifying beneficial owners will be enhanced when both auditors and audit clients take responsibility for promoting the accuracy of information required to assess the auditor's independence.

If the auditor determines that significant influence over the fund's management processes does not exist at the time of the initial application of the rule, the auditor should monitor the Loan Provision on an ongoing basis. 102 We continue to believe, as expressly supported by several commenters, 103 that the auditor could satisfy this obligation to monitor its independence on an ongoing basis by reevaluating its determination in response to a material change in the fund's governance structure and governing documents, Commission filings about beneficial owners, 104 or other information which may implicate the ability of a beneficial owner to exert significant influence of which the audit client or auditor becomes aware. Outside of the fund context, audit firms and their audit clients should continue to monitor the auditor's independence on an ongoing basis by using their existing processes for determining whether significant influence exists consistent with the principles of ASC 323. In this regard, we agree with those commenters  105 who indicated that the frequency and timing of the significant influence evaluation should be based on the particular facts and circumstances relevant to the audited entity, consistent with the requirement that the auditor be independent throughout the audit and professional engagement period. Accordingly, we have not included specific dates, periods or circumstances upon which the significant influence evaluation should occur.

The Coast Guard will enforce the special local regulations listed in 33 CFR 100.100 Table 1 on the specified dates and times as indicated in the following table:

Under the provisions of 33 CFR 100.100, the events listed above are established as special local regulations. During the enforcement period, persons and vessels are prohibited from entering into, transiting through, mooring, or anchoring within these regulated areas unless they receive permission from the COTP or designated representative.

This notice is issued under authority of 33 CFR 100 and 5 U.S.C. 552(a). In addition to this notice in the Federal Register , the Coast Guard will provide the maritime community with advance notification of this enforcement period via the Local Notice to Mariners or marine information broadcasts. If the COTP determines that these special local regulations need not be enforced for the full duration stated in this notice, a Broadcast Notice to Mariners may be used to grant general permission to enter the regulated area.

The Coast Guard will enforce the safety zones listed in 33 CFR 165.151 Table 1 on the specified dates and times as indicated in the following table:

Under the provisions of 33 CFR 165.151, the events listed above are established as safety zones. During the enforcement period, persons and vessels are prohibited from entering into, transiting through, mooring, or anchoring within these safety zones unless they receive permission from the COTP or designated representative.

This notice is issued under authority of 33 CFR 165 and 5 U.S.C. 552 (a). In addition to this notice in the Federal Register , the Coast Guard will provide the maritime community with advance notification of this enforcement period via the Local Notice to Mariners or marine information broadcasts. If the COTP determines that these safety zones need not be enforced for the full duration stated in this notice, a Broadcast Notice to Mariners may be used to grant general permission to enter the regulated area.

The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because it is impracticable and contrary to the public interest to do so. There is insufficient time to allow for a reasonable comment period prior to the date of the event. The rule must be in force by July 6, 2019. We are taking immediate action to ensure the safety of spectators and the general public from hazards associated with the fireworks display. Hazards include accidental discharge of fireworks, dangerous projectiles, and falling hot embers or other debris.

Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register . Delaying the effective date of this rule would be impracticable and contrary to the public interest because immediate action is needed to mitigate the potential safety hazards associated with a fireworks displays in this location.

The Coast Guard is issuing this rule under authority in 46 U.S.C. 70034 (previously 33 U.S.C. 1231). The Captain of the Port Delaware Bay (COTP) has determined that potential hazards associated with the fireworks to be used in this July 6, 2019 display will be a safety concern for anyone within an 800-foot radius of the barge. The purpose of this rule is to ensure safety of vessels and the navigable waters in the safety zone before, during, and after the scheduled event.

This rule establishes a temporary safety zone on the waters of the Delaware River near Talen Energy Stadium in Chester, PA, during a fireworks display scheduled to take place between 9:30 p.m. and 10:30 p.m. on July 6, 2019. The fireworks will be set off from a barge in the river, which will be anchored at approximate position latitude 39°49′43.4″ N, longitude 075°22′38.0″ W. The safety zone includes all navigable waters within 800 feet of the fireworks barge. No person or vessel will be permitted to enter, transit through, anchor in, or remain within the safety zone without obtaining permission from the COTP Delaware Bay or a designated representative. If the COTP Delaware Bay or a designated representative grants authorization to enter, transit through, anchor in, or remain within the safety zone, all persons and vessels receiving such authorization must comply with the instructions of the COTP Delaware Bay or a designated representative. The Coast Guard will provide public notice of the safety zone by Local Notice to Mariners and Broadcast Notice to Mariners.

We developed this rule after considering numerous statutes and Executive orders related to rulemaking. Below we summarize our analyses based on a number of these statutes and Executive orders and we discuss First Amendment rights of protestors.

Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. Executive Order 13771 directs agencies to control regulatory costs through a budgeting process. This rule has not been designated a “significant regulatory action,” under Executive Order 12866. Accordingly, the NPRM has not been reviewed by the Office of Management and Budget (OMB), and pursuant to OMB guidance it is exempt from the requirements of Executive Order 13771.

The impact of this rule is not significant for the following reasons: (1) The enforcement period will last one hour when vessel traffic is usually low; (2) although persons and vessels may not enter, transit through, anchor in, or remain within the safety zone without authorization from the COTP Delaware Bay or a designated representative, a portion of the channel will remain open. Persons and vessels will be able to operate in the surrounding area during the enforcement period; (3) persons and vessels will still be able to enter, transit through, anchor in, or remain within the regulated area if authorized by the COTP Delaware Bay or a designated representative; and (4) the Coast Guard will provide advance notification of the safety zone to the local maritime community by Local Notice to Mariners, Broadcast Notice to Mariners, and on-scene actual notice from designated representatives.

The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

While some owners or operators of vessels intending to transit the safety zone may be small entities, for the reasons stated in section IV.A above, this rule will not have a significant economic impact on any vessel owner or operator.

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

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

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

A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under that Order and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in Executive Order 13132.

Also, this rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it would not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. If you believe this rule has implications for federalism or Indian tribes, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section.

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

We have analyzed this rule under Department of Homeland Security Directive 023-01 and Environmental Planning COMDTINST 5090.1 (series), which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves a safety zone that will prohibit persons and vessels from entering, transiting through, anchoring in, or remaining within a limited area on the navigable water in the Delaware River, during a fireworks display lasting approximately one hour. It is categorically excluded from further review under paragraph L60(a) in Table 3-1 of U.S. Coast Guard Environmental Planning Implementing Procedures 5090.1. A Record of Environmental Consideration (REC) supporting this determination is available in the docket where indicated under ADDRESSES .

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

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

Throughout this document “we,” “us,” and “our” refer to the EPA.

The EPA is approving revisions to the Missouri SIP that were received by EPA on December 11, 2018. On April 12, 2019, the EPA proposed in the Federal Register approval of the SIP submission. See 84 FR 14906. The SIP revision revises Missouri's regulation, Title 10 Code of State Regulations (10 CSR) 10-6.180, “Measurement of Emissions of Air Contaminates”, which allows the director to obtain air contaminant emission data from any source responsible for the emissions of air contaminants. The revisions are administrative in nature. They restructure the rule to meet Missouri's updated standard rule organizational format and add definitions specific to the regulatory text of 10 CSR 10-6.180 including air contaminant, director, facility, qualified personnel and source.

The state submission has met the public notice requirements for SIP submissions in accordance with 40 CFR 51.102. The submission also satisfied the completeness criteria of 40 CFR part 51, appendix V. The State provided public notice on this SIP revision from May 1, 2018, to June 7, 2018, and received no comment. In addition, as explained above and in more detail in the technical support document which is part of this docket, the revision meets the substantive SIP requirements of the Clean Air Act (CAA), including section 110 and implementing regulations.

The public comment period on the EPA's proposed rule opened April 12, 2019, the date of its publication in the Federal Register and closed on May 13, 2019. During this period, the EPA received three comments, one of which was adverse. The EPA will address the adverse comment. No changes were made to the proposals in this final action after consideration of the adverse comments received.

Comment 1: A commenter expressed concern regarding what specifically ensures Federal enforceability of the state's rules and if this is working towards an overreach of the EPA's legal abilities.

Response 1: Federal enforceability occurs when a state regulation is submitted by the State and is then approved into the federally approved SIP, and those approved regulations are promulgated as Federal law in the Code of Federal Regulations (see generally 40 CFR 52.1320 for the approved Missouri regulations). Section 110 of the CAA requires states to develop air pollution regulations and control strategies to ensure that state air quality meets the national ambient air quality standards established by EPA. These ambient standards are established under section 109 of the CAA, and they currently address six criteria pollutants. These pollutants are carbon monoxide, nitrogen dioxide, ozone, lead, particulate matter, and sulfur dioxide. Each state must submit these regulations and control strategies to the EPA for approval and incorporation into the federally enforceable SIP, and under CAA section 110, the EPA must approve state SIP submissions that meet the requirements of the CAA. The CAA requires each state to have a Federally approved SIP which protects air quality primarily by addressing air pollution at its point of origin.

The EPA does not believe this Federal enforceability of the state's rules is an overreach, because enforcement of the state regulation before and after it is incorporated into the federally approved SIP is primarily a state responsibility. In addition, Congress specifically provided that after a state regulation is part of the federally approved SIP, the EPA is authorized to take enforcement action against violators under CAA section 113 (and public citizens may enforce some approved SIP provisions under CAA section 113).

The EPA is taking final action to amend the Missouri SIP by approving the State's request to amend 10 CSR 10-6.180, “Measurement of Emissions of Air Contaminants.” Approval of these revisions will ensure consistency between state and Federally-approved rules. The EPA has determined that these changes will not adversely impact air quality.

In this document, EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, the EPA is finalizing the incorporation by reference of the Missouri Regulations described in the amendments to 40 CFR part 52 set forth below. The EPA has made, and will continue to make, these materials generally available through www.regulations.gov and at the EPA Region 7 Office (please contact the person identified in the FOR FURTHER INFORMATION CONTACT section of this preamble for more information).

Therefore, these materials have been approved by the EPA for inclusion in the SIP, have been incorporated by reference by the EPA into that plan, are fully federally enforceable under sections 110 and 113 of the CAA as of the effective date of the final rulemaking of EPA's approval, and will be incorporated by reference in the next update to the SIP compilation. 1

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

• Is not a significant regulatory action subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);

• Is not an Executive Order 13771 (82 FR 9339, February 2, 2017) regulatory action because SIP approvals are exempted under Executive Order 12866.

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

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

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

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

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

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

• Is not subject to requirements of the National Technology Transfer and Advancement Act (NTTA) because this rulemaking does not involve technical standards; and

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

In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).

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

Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by September 3, 2019. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2)).

For the reasons stated in the preamble, the EPA amends 40 CFR part 52 as set forth below:

I. Background

Under the CAA, EPA establishes NAAQS for criteria pollutants in order to protect human health and the environment. In response to scientific evidence linking ozone exposure to adverse health effects, EPA promulgated the first ozone NAAQS, the 0.12 part per million (ppm) 1-hour ozone NAAQS, in 1979. See 44 FR 8202 (February 8, 1979). The CAA requires EPA to review and reevaluate the NAAQS every five years in order to consider updated information regarding the effects of the criteria pollutants on human health and the environment. On July 18, 1997, EPA promulgated a revised ozone NAAQS, referred to as the 1997 ozone NAAQS, of 0.08 ppm averaged over eight hours. See 62 FR 38855. This 8-hour ozone NAAQS was determined to be more protective of public health than the previous 1979 1-hour ozone NAAQS. In 2008, EPA strengthened the 8-hour ozone NAAQS from 0.08 to 0.075 ppm. The 0.075 ppm standard is referred to as the 2008 ozone NAAQS. See 73 FR 16436 (March 27, 2008).

On May 21, 2012 and June 11, 2012, EPA designated nonattainment areas for the 2008 ozone NAAQS. 77 FR 30088 and 77 FR 34221. Effective July 20, 2012, New Castle County and Sussex County in Delaware were designated as marginal nonattainment for the 2008 ozone NAAQS. New Castle County was designated as part of the Philadelphia-Wilmington-Atlantic City, PA-NJ-MD-DE 2008 ozone NAAQS nonattainment area, which includes the following counties: New Castle in Delaware; Cecil in Maryland; Atlantic, Burlington, Camden, Cape May, Cumberland, Gloucester, Mercer, Ocean, and Salem in New Jersey; and Bucks, Chester, Delaware, Montgomery, and Philadelphia in Pennsylvania. 40 CFR 81.308, 81.321, 81.331, and 81.339. Sussex County was designated marginal nonattainment as the Seaford 2008 ozone NAAQS nonattainment area, which includes only Sussex County. 40 CFR 81.308.

Section 182 of the CAA identifies plan submission requirements for ozone nonattainment areas. Specifically, section 182(a)(3)(B) requires that states develop and submit, as a revision to their SIP, rules which establish annual reporting requirements for certain stationary sources. Sources that are within ozone nonattainment areas must annually report the actual emissions of NO X and VOC to the state. However, states may waive this reporting requirement for classes or categories of stationary sources that emit under 25 tons per year (tpy) of NO X or VOC if the state provides an inventory of emissions from these classes or categories of sources as required by CAA sections 172 and 182. See CAA section 182(a)(3)(B)(ii).

On March 6, 2015, EPA issued a final rule addressing a range of nonattainment area SIP requirements for the 2008 ozone NAAQS, including the emissions statements requirement of CAA section 182(a)(3)(B) (2015 final rule). 80 FR 12264. Per the preamble to EPA's 2015 final rule, the source emissions statements requirement applies to all areas designated nonattainment for the 2008 ozone NAAQS. See 80 FR 12264, 12291. The preamble to EPA's 2015 final rule also states that most areas that are required to have an emissions statements program for the 2008 ozone NAAQS already have a program in place due to a nonattainment designation for an earlier ozone NAAQS. Id. The preamble to EPA's 2015 final rule states that, “If an area has a previously approved emissions statement rule in force for the 1997 ozone NAAQS or the 1-hour ozone NAAQS that covers all portions of the nonattainment area for the 2008 ozone NAAQS, such rule should be sufficient for purposes of the emissions statement requirement for the 2008 ozone NAAQS.” Id. In cases where an existing emissions statements rule is still adequate to meet the emissions statements requirement under the 2008 ozone NAAQS, states may provide the rationale for that determination to EPA in a written statement for approval in the SIP to meet the requirements of CAA section 182(a)(3)(B). Id. In this statement, states should identify how the emissions statements requirement of CAA section 182(a)(3)(B) are met by their existing emissions statement rule. Id.

In summary, Delaware is required to submit, as a formal revision to its SIP, a statement certifying that Delaware's existing emissions statements program satisfies the requirements of CAA section 182(a)(3)(B) and covers Delaware's portions of the Philadelphia-Wilmington-Atlantic City, PA-NJ-MD-DE 2008 ozone NAAQS nonattainment area ( i.e. New Castle County) and the Seaford 2008 ozone NAAQS nonattainment area ( i.e. Sussex County).

On June 29, 2018, the State of Delaware, through the Delaware Department of Natural Resources and Environmental Control (DNREC), submitted, as a formal revision to its SIP, a statement certifying that Delaware's existing SIP-approved emissions statements program under 7 DE Administrative Code 1117 Section 7.0 satisfies the emissions statements requirement for the 2008 ozone NAAQS.

On April 9, 2019 (84 FR 14075), EPA published a notice of proposed rulemaking (NPRM) for the State of Delaware. In the NPRM, EPA proposed to approve, as a SIP revision, Delaware's June 29, 2018 emissions statements certification as satisfying the requirements of CAA section 182(a)(3)(B) for the 2008 ozone NAAQS. The rationale for EPA's proposed action can be found in the April 9, 2019 NPRM and will not be restated here.

EPA received comments on the April 9, 2019 NPRM from three anonymous commenters. EPA received a comment on April 11, 2019 that was supportive of EPA's proposed action; EPA is not responding to that comment. The other two comments and EPA's responses are discussed below. The comments EPA received are included in the docket for this action, available online at www.regulations.gov, Docket ID: EPA-R03-OAR-2018-0825.

Commenter 1: On April 9, 2019, EPA received an anonymous comment on the NPRM. The commenter emphasizes the importance of emissions reporting of NO X and VOC in ozone nonattainment areas. The commenter expresses concern regarding states' ability to waive the emissions reporting requirement “if they emit under 25 tons per year of NO X and/or VOC.” The commenter states that the purpose of emissions reporting is to understand the total amount of emissions in a state “no matter how little they emit” and suggests that this would assist with the identification and resolution of air quality problems. The commenter also expresses concern that if a state has waived the emissions statements requirements and emissions in a state are low at the beginning of the year and then increase, it would take a year to identify the increase in emissions which may delay potential actions by EPA.

EPA Response: Section 182(a)(3)(B)(ii) of the CAA permits states to waive the emissions statements requirement of CAA section 183(a)(3)(B)(i) for any class or category of stationary sources which emit less than 25 tpy of NO X or VOC if the state provides an inventory of emissions from these classes or categories of sources as required by CAA sections 172 and 182. As discussed in the NPRM, Section 7.1 of Delaware's emissions statements provisions under 7 DE Administrative Code 1117 Section 7.0 states that Delaware may, with EPA approval, “waive the emissions statements requirements for classes or categories of stationary sources with facility-wide actual emissions of less than 25 tpy of NO X or VOCs if the class or category is included in the base year and periodic ozone SIP emission inventories, and the actual emissions were calculated using EPA-approved emission factors or other methods acceptable to the EPA.” This is consistent with CAA section 182(a)(3)(B)(ii) and is more stringent than the requirements of the CAA as it requires EPA approval to waive the emissions statements requirement. Therefore, EPA continues to find that Delaware's emissions statements provisions under 7 DE Administrative Code 1117 Section 7.0 meet the requirements of CAA section 182(a)(3)(B)(ii) for the 2008 ozone NAAQS.

In addition, EPA disagrees with the commenter that permitting states to waive the emissions statements requirement for classes or categories of sources that emit less than 25 tpy of NO X or VOC will prevent EPA from obtaining data regarding a state's total emissions of NO X and VOC or delay EPA in identifying increases in emissions. As stated previously, states are required by CAA section 182(a)(3)(B) to have an emissions reporting program (also referred to as an “emissions statements” program) requiring sources located in ozone nonattainment areas that emit 25 tpy or more of NO X or VOC to annually report actual emissions to the State (emphasis added). The emissions statements requirement of CAA section 182(a)(3)(B) is separate from the requirements for the state to submit emissions data to EPA. States are required to submit emissions data to EPA under the Air Emissions Reporting Rule (AERR). 40 CFR, part 51, subpart A. 1 The AERR requires states to submit to EPA complete and comprehensive data on emissions from certain point, nonpoint, onroad, and nonroad sources triennially. In addition, the AERR requires annual reporting for larger, Type A, point sources. 2 Pursuant to 40 CFR 51.20, all anthropogenic stationary sources must be included in the emission inventory as either point or nonpoint sources; if a facility's emissions are too low to be considered a “point source”, the emissions must be reported as nonpoint sources. 3 Therefore, the AERR provides for the reporting of complete and comprehensive data on a state's total emissions of NO X and VOC by the state to EPA. While states may use data submitted by sources through their emissions statements program to satisfy the AERR, the AERR is separate from the emissions statements requirement of CAA section 182(a)(3)(B). Therefore, the waiving of a class or category of source from a state's emissions statements program does not affect the state's obligation to report emissions from these sources to EPA under the AERR.

In addition, pursuant to CAA section 182(a)(3)(B)(ii), states may only waive the emissions statements requirement for any class or category of sources that emit less than 25 tpy of NO X or VOC if the state includes that class or category of sources in the base year and periodic inventories required by CAA section 172(c)(3), 182(a)(1), and 182(a)(3)(A) and emissions are calculated using emission factors established by EPA or other methods acceptable to EPA (emphasis added). 4 EPA uses the emissions data submitted by the states under the AERR to build the National Emissions Inventory (NEI), which in turn may be used by the states for their base year and periodic emission inventories. 5 A state's waiver of the emissions statements requirement for a class or category of sources that emit less than 25 tpy of NO X or VOC does not waive the requirement for the sources to be captured in the state's emissions inventory. Sources will be captured as either point or nonpoint sources in the emission inventories regardless of whether a state has waived them from their emissions statements program. Therefore, EPA will still have comprehensive data on emissions in a state that meets the emissions inventory requirements of the CAA. Regarding the concern about data not being submitted regularly enough, CAA section 182(a)(3)(B) only requires that “[s]ubsequent statements shall be submitted at least every year thereafter.” Therefore, Delaware's requirement for sources to submit emissions statements annually complies with the requirements of the CAA.

Commenter 2: EPA received an anonymous comment on April 19, 2019 inquiring how EPA's proposed action in the April 9, 2019 NPRM will affect corporations incorporated in Delaware and if these corporations will be required to change their business practices as a result of this rulemaking.

EPA Response: EPA's approval of Delaware's emissions statements certification for the 2008 ozone NAAQS will not change the existing emission statement requirements for corporations incorporated in Delaware. EPA's April 9, 2019 NPRM proposed to approve, as a SIP revision, Delaware's certification that the State's existing, SIP-approved emissions statements provisions under 7 DE Administrative Code 1117 Section 7.0 continue to satisfy the emissions statements requirements of CAA section 182(a)(3)(B) for the 2008 ozone NAAQS. Delaware's existing emissions statements provisions were first approved by EPA into the Delaware SIP on April 29, 1996 (61 FR 7415) for a previous NAAQS and are therefore already effective. EPA's NPRM only proposed to find that these existing, unchanged provisions continue to satisfy the requirements of CAA section 182(a)(3)(B) for the 2008 ozone NAAQS. Because Delaware's emissions statement requirements are unchanged, this SIP approval will not add any additional requirements for sources in Delaware. Therefore, EPA's approval of Delaware's emissions statements certification for the 2008 ozone NAAQS will not change the previously applicable emissions statement requirements for emission sources located in Delaware and therefore will not likely cause sources in Delaware to change their business practices. To the extent that the commenter is asking whether companies incorporated in Delaware but with facilities outside of Delaware that emit NO X or VOC will be affected by Delaware's emission statement regulation, the answer is no. Sources outside of Delaware will be required to report their emissions of NO X and VOC according to the regulations of the state in which that source is located.

EPA is approving, as a SIP revision, the State of Delaware's June 29, 2018 emissions statements certification for the 2008 ozone NAAQS as approvable under CAA section 182(a)(3)(B). Delaware's emissions statements certification certifies that Delaware's existing SIP-approved emissions statements program under 7 DE Administrative Code 1117 Section 7.0 satisfies the requirements of CAA section 182(a)(3)(B) for the 2008 ozone NAAQS.

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

• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);

• Is not an Executive Order 13771 (82 FR 9339, February 2, 2017) regulatory action because SIP approvals are exempted under Executive Order 12866.

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

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

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

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

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

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

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

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

In addition, this 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.

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

Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by September 3, 2019. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed and shall not postpone the effectiveness of such rule or action. This action approving Delaware's emissions statements certification for the 2008 ozone NAAQS may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2)).

40 CFR part 52 is amended as follows:

I. Background

On March 19, 2019 (84 FR 9995), EPA published a notice of proposed rulemaking (NPRM) for the District. In the NPRM, EPA proposed approval of the District's NNSR Certification for the 2008 8-hour ozone NAAQS. The formal SIP revision was submitted by the District on May 23, 2018. This SIP revision was in response to EPA's final 2008 8-hour ozone NAAQS Findings of Failure to Submit for NNSR requirements. See 82 FR 9158 (February 3, 2017). Specifically, the District certified that its existing NNSR program, covering the District portion of the Washington, DC-MD-VA Nonattainment Area (Washington Area) for the 2008 8-hour ozone NAAQS, is at least as stringent as the requirements at 40 CFR 51.165, as amended by the final rule titled “Implementation of the 2008 National Ambient Air Quality Standards for Ozone: State Implementation Plan Requirements” (SIP Requirements Rule), for ozone and its precursors. 1   2 See 80 FR 12264 (March 6, 2015).

On March 12, 2008, EPA promulgated a revised 8-hour ozone NAAQS of 0.075 parts per million (ppm). See 73 FR 16436 (March 27, 2008). Under EPA's regulations at 40 CFR 50.15, the 2008 8-hour ozone NAAQS is attained when the three-year average of the annual fourth-highest daily maximum 8-hour average ambient air quality ozone concentration is less than or equal to 0.075 ppm.

Upon promulgation of a new or revised NAAQS, the CAA requires EPA to designate as nonattainment any area that is violating the NAAQS based on the three most recent years of ambient air quality data at the conclusion of the designation process. The Washington Area was classified as marginal nonattainment for the 2008 8-hour ozone NAAQS on May 21, 2012 (effective July 20, 2012) using 2008-2010 ambient air quality data. See 77 FR 30088. On March 6, 2015, EPA issued the final SIP Requirements Rule, which establishes the requirements that state, tribal, and local air quality management agencies must meet as they develop implementation plans for areas where air quality exceeds the 2008 8-hour ozone NAAQS. See 80 FR 12264. Areas that were designated as marginal ozone nonattainment areas were required to attain the 2008 8-hour ozone NAAQS no later than July 20, 2015, based on 2012-2014 monitoring data. See 40 CFR 51.1103. The Washington Area did not attain the 2008 8-hour ozone NAAQS by July 20, 2015; however, the area did meet the CAA section 181(a)(5) criteria, as interpreted in 40 CFR 51.1107, for a one-year attainment date extension. See 81 FR 26697 (May 4, 2016). Therefore, on April 11, 2016, the EPA Administrator signed a final rule extending the Washington Area 8-hour ozone NAAQS attainment date from July 20, 2015 to July 20, 2016. Id. 3

Based on initial nonattainment designations for the 2008 8-hour ozone NAAQS, as well as the March 6, 2015 final SIP Requirements Rule, the District was required to develop a SIP revision addressing certain CAA requirements for the Washington Area, and submit to EPA a NNSR Certification SIP or SIP revision no later than 36 months after the effective date of area designations for the 2008 8-hour ozone NAAQS ( i.e., July 20, 2015). 4 See 80 FR 12264 (March 6, 2015). EPA is approving the District's May 23, 2018 NNSR Certification SIP revision for the 2008 8-hour ozone NAAQS.

This rulemaking action is specific to the District's NNSR requirements. NNSR is a preconstruction review permit program that applies to new major stationary sources or major modifications at existing sources located in a nonattainment area. The specific NNSR requirements for the 2008 8-hour ozone NAAQS are located in 40 CFR 51.160 through 165.

The District's SIP approved NNSR program, established in Chapters 1 ( Air Quality-General Rules ) and 2 ( Air Quality—General and Nonattainment Area Permits ) in Title 20 of the District of Columbia Municipal Regulations (DCMR), apply to the construction and modification of major stationary sources in nonattainment areas. In its May 23, 2018 SIP revision, the District certified that the versions of 20 DCMR Chapters 1 and 2 approved in the SIP are at least as stringent as the Federal NNSR requirements for the Washington Area.

In addition, on February 3, 2017, EPA found that 15 states and the District failed to submit SIP revisions in a timely manner to satisfy certain requirements for the 2008 8-hour ozone NAAQS that apply to nonattainment areas and/or states in the OTR. See 82 FR 9158. As explained in that rulemaking action, consistent with the CAA and EPA regulations, these Findings of Failure to Submit established certain deadlines for the imposition of sanctions, if a state does not submit a timely SIP revision addressing the requirements for which the finding is being made, and for the EPA to promulgate a Federal implementation plan (FIP) to address any outstanding SIP requirements.

EPA found, inter alia, that the District failed to submit SIP revisions in a timely manner to satisfy NNSR requirements for the Washington Area. The District submitted its May 23, 2018 SIP revision to address the specific NNSR requirements for the 2008 8-hour ozone NAAQS, located in 40 CFR 51.160 through 165, as well as its obligations under EPA's February 3, 2017 Findings of Failure to Submit. EPA's analysis of how this SIP revision addresses the NNSR requirements for the 2008 8-hour ozone NAAQS and the Findings of Failure to Submit was discussed in the NPRM and will not be restated here.

EPA received one set of relevant comments on the March 19, 2019 NPRM. A summary of the comments and EPA's responses are discussed in this Section. A copy of the comments can be found in the docket for this rulemaking action.

Comment: The commenter affirms that under the CAA the EPA sets NAAQS for six criteria pollutants and after each NAAQS is set, states throughout the United States are required to develop reduction strategies, plans, and programs in order to attain those NAAQS. Further, the commenter notes that in 2008 EPA revised the 8-hour ozone NAAQS to 0.075 parts per million, which is attained when the three-year average of the annual fourth-highest daily maximum average is less than 0.075 ppm. The commenter asserts there is evidence to show that there is a relationship between ozone exposure and a number of lung and heart related diseases in children and adults, which in some cases increases visits to the Emergency Department (ED). Lastly, the commenter notes that ozone impacts human health and, if EPA approves the District's SIP, it is going against EPA's missions to protect human and environmental health.

EPA Response: While not the subject of this rulemaking action, EPA thanks the commenter for their comments and agrees with the commenter's assertions, as it relates to setting the NAAQS and the impacts ozone can have on our health and the environment. In order to protect human health and welfare, the CAA requires EPA to establish NAAQS for certain common and widespread pollutants based on the latest science. Sections 108 and 109 of the CAA govern the establishment, review and revision, as appropriate, of the NAAQS for each of the six common criteria air pollutants: Ground-level ozone, particulate matter, carbon monoxide, lead, sulfur dioxide, and nitrogen dioxide. The CAA requires periodic review of the science upon which the standards are based and the standards themselves.

EPA concurs that ozone pollution can trigger a variety of health problems, particularly for children, the elderly, and people of all ages who have lung diseases such as asthma. Which may in turn, increase emergency room visits and days absent from school and work. Specific to the 2008 8-hour ozone NAAQS, EPA looked at many epidemiological studies to determine ozone's effect on the population. 5

Upon EPA's comprehensive review of the ozone NAAQS, the 2008 8-hour ozone standard in this instance, EPA issued its final action to revise the NAAQS for ozone to establish new 8-hour standards. See 73 FR 16436 (March 27, 2008). In that action, the EPA promulgated identical revised primary (health-based) and secondary (welfare-based) ozone standards, designed to protect public health and welfare, of 0.075 parts per million (ppm). 6 Those standards are met when the 3-year average of the annual fourth highest daily maximum 8-hour average ozone concentration is less than or equal to 0.075 ppm. See 40 CFR 50.15.

As discussed in the NPRM, promulgation of a revised NAAQS triggers a requirement for the EPA to designate areas of the country as nonattainment, attainment, or unclassifiable for the standards; for ozone NAAQS, this also involves classifying any nonattainment areas at the time of designation. See CAA sections 107(d)(1) and 181(a)(1). Ozone nonattainment areas are classified based on the severity of their ozone levels (as determined based on the area's “design value,” which represents air quality in the area for the most recent three years). The possible classifications for ozone nonattainment areas are marginal, moderate, serious, severe, and extreme. See CAA section 181(a)(1). Nonattainment areas with a “lower” classification have ozone levels that are closer to the standard than areas with a “higher” classification. 7 On May 21, 2012 and June 11, 2012, the EPA issued rules designating 46 areas throughout the country as nonattainment for the 2008 ozone NAAQS, effective July 20, 2012, and establishing classifications for the designated nonattainment areas. 8 As noted previously, the Washington Area was designated as marginal for the 2008 8-hour ozone standard. Areas designated nonattainment for the ozone NAAQS are subject to the general nonattainment area planning requirements of CAA section 172 and also to the ozone-specific planning requirements of CAA section 182. States in the OTR are additionally subject to the requirements outlined in CAA section 184. Ozone nonattainment areas in the lower classification levels have fewer and/or less stringent mandatory air quality planning and control requirements than those in higher classifications. For a marginal area, a state is required to submit a baseline emissions inventory and adopt a SIP requiring emissions statements from stationary sources and implementing a NNSR program for the relevant ozone standard. See CAA section 182(a). For a moderate area, a state needs to comply with the marginal area requirements, plus additional requirements, including the requirement to submit a demonstration that the area will attain in six years, the requirement to adopt and implement certain emissions controls, such as Reasonably Available Control Technology (RACT), and the requirement for greater emissions offsets for new or modified major stationary sources under the state's NNSR program. For each higher ozone nonattainment classification, a state needs to comply with all lower area classification requirements, plus additional emissions controls and more expansive NNSR offset requirements.

The CAA sets out specific requirements for states in the OTR. 9 Upon promulgation of the 2008 ozone NAAQS, states in the OTR were required to submit a SIP revision for RACT. See 40 CFR 51.1116. As noted in the March 19, 2019 NPRM, this requirement is the only recurring obligation for an OTR state upon revision of a NAAQS, unless that state also contains some portion of a nonattainment area for the revised NAAQS. In that case, the nonattainment requirements described above also apply to those portions of that state.

On March 6, 2015, the EPA established a final implementation rule for the 2008 ozone SIP Requirements Rule. See 80 FR 12264. The purpose of that action was to detail the requirements applicable to ozone nonattainment areas, as well as requirements that apply in the OTR, and provide specific deadlines for SIP submittals.

EPA agrees with the commenter and has taken the appropriate steps to promulgate ozone NAAQS that are protective of human health and the environment, in addition to providing ozone nonattainment areas with their specific statutory obligations under the CAA. EPA disagrees with the commenter's assertion that by approving the District's 2008 8-hour ozone SIP revision certifying that its NNSR program is adequate, EPA is somehow going against its mission to protect human health and the environment. To the contrary, EPA has determined that the District is meeting their statutory obligations relating to NNSR permitting as needed to work towards attaining and maintaining the 2008 8-hour ozone NAAQS, as required by the CAA and the final SIP Requirements Rule.

Comment: The commenter states that in 2012, the Washington Area was in nonattainment and, subsequently in 2015 EPA issued a rule requiring state, local, and tribal air quality management agencies to create plans and programs to reduce ozone pollution. The commenter notes that the Washington Area modified its SIP and that EPA should not approve the District's SIP (EPA assumes the commenter is referring to a revision to the District's SIP).

EPA Response: EPA agrees with the commenter's first point and notes that, as stated in the NPRM, the Washington Area was classified as marginal nonattainment for the 2008 8-hour ozone NAAQS on May 21, 2012 (effective July 20, 2012) using 2008-2010 ambient air quality data. See 77 FR 30088.

As it relates to the commenter's second point, in EPA's March 19, 2019 NPRM and in the previous response to comment, EPA thoroughly discussed specific SIP requirements for the 2008 ozone NAAQS as set forth in the March 6, 2015 final SIP Requirements Rule and those specific requirements will not be restated here. See 84 FR 9995.

Lastly, it is unclear to EPA what SIP revision (or plan revision) the commenter is referring to and, therefore, EPA cannot offer a specific response, except to reaffirm that per the subject of this rulemaking action, EPA is finalizing its determination that the District's existing NNSR program for the 2008 8-hour ozone NAAQS is at least as stringent as the requirements at 40 CFR 51.165, as amended by the final SIP Requirements Rule, for ozone and its precursors. See 80 FR 12264 (March 6, 2015).

Comment: The commenter emphasized that the District's SIP states that because the District is in the OTR, they do not need to meet the NAAQS requirements. The commenter then notes that because they are in the OTR, they are only required to meet the threshold under the Federal OTR requirements.

EPA Response: EPA believes the commenter misunderstood the statement being made in the District's May 23, 2018 SIP revision. In EPA's March 19, 2019 NPRM, there was a thorough discussion related to applicable OTR requirements and those specifics will not be restated here, except to note that the entire District is currently designated as nonattainment for the 2008 8-hour ozone NAAQS. See “Summary of SIP Revision and EPA Analysis” in 84 FR 9995. Therefore, OTR emissions threshold requirements would not apply, but NNSR emissions thresholds (and all other NNSR requirements) continue to apply. See 40 CFR 51.165(a)(1)(iv)(A)(1). If EPA redesignates the Washington Area to attainment for the 2008 8-hour ozone NAAQS, at that time NNSR would no longer apply, but the Federal prevention of significant deterioration (PSD) and Federal OTR requirements ( i.e., emissions thresholds and other applicable requirements) would apply to major sources in the District.

Comment: The commenter asserts that despite the District never being classified as extreme nonattainment for ozone, the District should do a full review of their regulations.

EPA Response: EPA agrees with the commenter's first point and the District's own assertion in its May 23, 2018 SIP revision. The District has never been classified as extreme nonattainment for an ozone NAAQS. Regarding the statement that the District should do a full review of its regulations, that comment is outside the scope of this action. This specific rulemaking action is focused on NNSR requirements that apply to the nonattainment area and the District's SIP approved NNSR program, established in Chapters 1 ( Air Quality-General Rules ) and 2 ( Air Quality—General and Nonattainment Area Permits ) in Title 20 of the District of Columbia Municipal Regulations (DCMR). The District evaluated the necessary regulations for this rulemaking action and certified in its May 23, 2018 SIP revision that its existing Federally-approved NNSR program is at least as stringent as the Federal NNSR requirements found at 40 CFR 51.165, and based on EPA's analysis of that SIP revision, EPA agrees with the District and is moving forward to approve this rulemaking action.

Comment: The commenter makes a claim that in 2017, the Director of the District's Department of Energy and Environment (DOEE) claimed to be close to achieving the NAAQS standard for ozone, which has yet to happen.

EPA Response: While EPA cannot speak to specific statements made by the Director of DOEE, nor are those alleged statements the subject of this rulemaking action, EPA can identify its approval of a Determination of Attainment (DOA) for the 2008 8-hour ozone NAAQS for the Washington Area. That action was based on complete, certified, and quality assured ambient air quality monitoring data for the 2013-2015 monitoring period. See 82 FR 52651 (November 14, 2017). It should be noted that a DOA does not alleviate the need for the District to certify that its existing SIP approved NNSR program is as stringent as the requirements at 40 CFR 51.165, as NNSR applies in nonattainment areas until an area has been redesignated to attainment.

In addition, on March 12, 2018, the District submitted to EPA for its approval, a redesignation request and maintenance plan for the 2008 8-hour ozone NAAQS. EPA has already acted on the District's maintenance plan portion of that March 12, 2018 SIP submittal and proposed approval of the District's redesignation request on May 21, 2019. See 84 FR 15108 (April 15, 2019) and 84 FR 22996, respectively.

Comment: The commenter makes a statement that the District has not submitted a SIP which includes regional planning, an emissions inventory, sources of haze-causing pollutants and a long-term strategy since 2010 and that this report should be updated, because the District is still in nonattainment for ozone. The commenter further asserts that EPA should not approve the District's SIP, because the District is not in attainment for ozone. The commenter believes that the District should be required to submit a full revision of its 2010 SIP and include an emissions inventory and a long-term strategy at the very least.

EPA Response: It is unclear what “full revision of the 2010 SIP” the commenter is referencing, but to the extent the commenter is referring to a previously approved DOA and Clean Data Determination (CDD) for the 1997 8-hour Moderate Ozone Nonattainment Area, it is not the subject of this rulemaking action. See 77 FR 11739 (February 28, 2012). EPA received the District's SIP revision for that rulemaking action on June 15, 2010 and finalized the rulemaking in 2012. 10

The commenter also suggests that the District should be required to submit a full revision of its 2010 SIP, with an emissions inventory and long-tern strategy at the very least. This comment is not germane to this rulemaking action, which is focused on the District's NNSR program. The applicable CAA requirements for the District were clearly articulated in the March 19, 2019 NPRM for this action and will not be restated here.

Finally, EPA disagrees with the commenter's statement that because the District is still in nonattainment, this SIP revision should not be approved. This SIP revision addressing NNSR requirements was submitted because the District was designated nonattainment for the 2008 8-hour ozone NAAQS. The SIP revision is an applicable requirement under the CAA for nonattainment areas and the District's SIP meets the applicable CAA standards; therefore, EPA is approving the SIP revision as required under CAA section 110(k)(3).

EPA is approving the District's May 23, 2018 SIP revision addressing the NNSR requirements for the 2008 ozone NAAQS for the Washington Area. EPA has concluded that the District's submission fulfills the 40 CFR 51.1114 revisions requirement, meets the requirements of CAA section 110 and 172 and the minimum SIP requirements of 40 CFR 51.165, as well as its obligations under EPA's February 3, 2017 Findings of Failure to Submit. See 82 FR 9158.

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

• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);

• Is not an Executive Order 13771 (82 FR 9339, February 2, 2017) regulatory action because SIP approvals are exempted under Executive Order 12866.

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

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

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

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

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

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

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

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

In addition, this 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.

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

Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by September 3, 2019. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action pertaining to the District's NNSR program and the 2008 8-hour ozone NAAQS may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

40 CFR part 52 is amended as follows:

I. Background

On April 26, 2019 (84 FR 17762), EPA published a notice of proposed rulemaking (NPRM) for the Commonwealth of Pennsylvania proposing to approve its revision to remove from the Pennsylvania SIP the ACHD requirements for use of 7.8 psi RVP gasoline during summer months in Allegheny County, Pennsylvania. The formal SIP revision requesting this removal of the ACHD summertime low RVP program for the Pittsburgh-Beaver Valley Area was submitted by PADEP, on Allegheny County's behalf, on March 19, 2019. In the NPRM, EPA proposed to approve Pennsylvania's request to remove the 7.8 psi RVP summertime gasoline requirement in Allegheny County from the Pennsylvania SIP.

EPA received several adverse comments on the April 26, 2019 proposed rulemaking. EPA has addressed the public comments received on this action below, in Section IV of this preamble. EPA is finalizing approval of Pennsylvania's request to remove the ACHD 7.8 psi RVP summer gasoline requirements applicable to Allegheny County from the SIP and has concluded that doing so does not interfere with the Pittsburgh-Beaver Valley Area's ability to attain or maintain any NAAQS under section 110( l ) of the CAA.

On November 6, 1991, EPA designated and classified the Pittsburgh-Beaver Valley Area as moderate nonattainment for the 1979 1-hour ozone NAAQS. As part of Pennsylvania's efforts to bring the Pittsburgh-Beaver Valley Area into attainment of the then applicable ozone NAAQS, the PADEP and ACHD responded by adopting a range of ozone precursor emission control measures for the area—including adoption of separate state and Allegheny County rules to limit summertime gasoline volatility to 7.8 psi RVP. While Pennsylvania's RVP control rule applied to the entire Pittsburgh-Beaver Valley Area—Allegheny, Armstrong, Beaver, Butler, Fayette, Washington, and Westmoreland Counties—ACHD adopted a substantially similar rule applicable only in Allegheny County.

Each of these overlapping RVP control rules was separately submitted to EPA for inclusion in the Pennsylvania SIP. PADEP promulgated its rule applicable to the entire Pittsburgh-Beaver Valley Area in the November 1, 1997 Pennsylvania Bulletin (27 Pa.B. 5601, effective November 1, 1997), codifying its rule at Subchapter C of Chapter 126 of the Pennsylvania Code of Regulations (25 Pa. Code Chapter 126, Subchapter C). Pennsylvania first submitted that rule for inclusion in the Pennsylvania SIP on April 17, 1998, which EPA approved on June 8, 1998 (63 FR 31116). The ACHD initially adopted its own substantially similar summertime gasoline 7.8 psi RVP rule (applicable only to Allegheny County) via Allegheny County Order No. 16782, Article XXI, sections 2102.40, 2105.90, and 2107.15 (effective May 15, 1998, amended August 12, 1999). On March 23, 2000, PADEP submitted this ACHD rule to EPA for incorporation into the Pennsylvania SIP, which EPA approved on April 17, 2001 (66 FR 19724), effective June 18, 2001.

In the 2013 through 2014 session, the Pennsylvania General Assembly passed, and Governor Corbett signed into law, Act 50 (Pub. L. 674, No. 50 of May 14, 2014). Act 50 amended the Pennsylvania Air Pollution Control Act, directing PADEP to initiate a process to obtain approval from EPA of a SIP revision that demonstrates continued compliance with the NAAQS, through utilization of substitute, commensurate emissions reductions to offset the emissions reduction impact associated with repeal of the Pittsburgh-Beaver Valley Area 7.8 RVP gasoline requirement. Act 50 directs PADEP to repeal, upon EPA approval of its NAAQS noninterference demonstration, the summertime gasoline RVP limit provisions of 25 Pa. Code Chapter 126, Subchapter C.

On May 2, 2018, PADEP submitted a SIP revision to EPA requesting removal from the Pennsylvania SIP of the state requirements of Chapter 126, Subchapter C of the Pennsylvania Code, based upon a demonstration that the repeal of the RVP requirements rule (coupled with other ozone precursor emission reduction measures) would not interfere with the Pittsburgh-Beaver Valley Area's attainment of any NAAQS, per the requirements for noninterference set forth in section 110( l ) of the CAA. Section 110( l ) prohibits EPA from approving a SIP revision if the revision “would interfere with any applicable requirement concerning attainment and reasonable further progress . . . or any other applicable requirement of [the Act.]”

On December 20, 2018 (83 FR 65301), EPA approved Pennsylvania's May 2018 request to remove from the SIP PADEP's rules under 25 Pa. Code Chapter 126 requiring 7.8 psi RVP gasoline during summer months in the greater Pittsburgh-Beaver Valley Area. EPA's action also approved Pennsylvania's CAA 110( l ) NAAQS noninterference demonstration showing that the emissions impact from repeal of the 7.8 psi gasoline volatility requirements in the entire Pittsburgh-Beaver Valley Area (including Allegheny County) is offset by means of substitution of commensurate emissions reductions from other measures enacted by Pennsylvania. Upon the effective date of EPA's December 2018 action, Allegheny County remained subject to ACHD's 7.8 psi RVP summer gasoline limits, while the remainder of the Pittsburgh-Beaver Valley Area became subject to Federal 9.0 RVP summer gasoline limits.

ACHD subsequently revised its own 7.8 psi RVP rule (codified at Article XXI, §§ 2105.90 and 2107.15 of the Rules and Regulations of the Allegheny County Health Department; amended February 21, 2019, effective March 3, 2019) to suspend applicability of ACHD's 7.8 psi RVP summer gasoline requirements. This ACHD Article XXI rule revision established its effective date as the date of EPA's removal of the revised Article XXI sections from the Allegheny County portion of the Pennsylvania SIP. On March 19, 2019, PADEP submitted this SIP revision (on behalf of ACHD) to EPA to request removal of the ACHD's RVP rule requirements from the Pennsylvania SIP. It is this March 2019 request to remove the ACHD RVP program requirements from the SIP that is the subject of EPA's current rulemaking action.

EPA's primary consideration for determining the approvability of Pennsylvania's request (on behalf of ACHD) to remove the County requirements for a gasoline volatility control program from its SIP is whether this requested action complies with section 110 of the CAA, and specifically with section 110( l ), governing removal of an EPA-approved SIP requirement. 1 Section 110( l ) of the CAA prohibits EPA from approving any SIP revision if such revision would interfere with any applicable requirement concerning attainment and reasonable further progress (as defined in section 171), or any other applicable requirement of the CAA. An earlier Pennsylvania SIP revision submitted to EPA on May 2, 2018 included a “noninterference demonstration” explaining how the removal of the 7.8 psi RVP requirement would not interfere with attaining or maintaining any NAAQS in the entire Pittsburgh-Beaver Valley Area, including Allegheny County.

EPA evaluates each section 110( l ) noninterference demonstration on a case-by-case basis considering the circumstances of each SIP revision. EPA interprets CAA section 110( l ) as applying to all NAAQS that are in effect, including those that have been promulgated, but for which EPA has not yet made designations. In evaluating whether a given SIP revision would interfere with attainment or maintenance, as required by CAA section 110( l ), EPA generally considers whether the SIP revision will allow for an increase in actual emissions into the air over what is allowed under the existing EPA-approved SIP. In the absence of an attainment demonstration or maintenance plan that demonstrates removal of an emissions control measure will not interfere with any applicable NAAQS or requirement of the CAA under section 110( l ), states may substitute equivalent emissions reductions to compensate for any change to a SIP-approved program, with the purpose of providing that the status quo air quality is preserved.

As discussed in the NPRM for this action, for removal of the Allegheny County low-RVP requirement from the SIP, PADEP and ACHD relied upon the existing CAA 110( l ) noninterference demonstration that was prepared in support of PADEP's May 2, 2018 SIP revision approved by EPA in December 2018. Because EPA had already acted on that demonstration applicable to removal of 7.8 psi RVP gasoline in the entire Pittsburgh-Beaver Valley Area, EPA did not completely reconsider the content and findings of that demonstration with respect to removal in this action of ACHD's similar rule applicable only to Allegheny County. EPA's review of the Commonwealth's analysis is contained in the docket for EPA's prior action (published December 20, 2018 (83 FR 65301)) to remove the PADEP 7.8 psi RVP program from the Pittsburgh-Beaver Valley Area. Based on our review of the information provided, EPA found that PADEP used reasonable methods and the appropriate tools ( e.g., emissions estimation models, emissions factors, and other methodologies) in estimating the effect on emissions from removing the 7.8 psi RVP summertime gasoline program for the purpose of demonstrating noninterference with any NAAQS under CAA 110( l ).

The result of the analysis was that with the substituted measures, the entire Pittsburgh-Beaver Valley Area will experience lower levels of ozone pollution precursors of volatile organic compounds (VOCs) and nitrogen oxides (NO X ), and of fine particulate matter smaller than 2.5 microns (PM 2.5 ), with the substitute measures in place than it would with continued operation of the 7.8 psi RVP program in the area. In reviewing ACHD's March 2019 submittal, EPA considered whether there was any new circumstances or information since the May 2018 demonstration submitted by PADEP that would cause EPA to reconsider whether the prior analysis was still valid. Neither EPA nor the commenters identified any such changes in circumstances which would invalidate the May 2018 demonstration analysis.

EPA concludes that the Commonwealth's May 2018 demonstration supporting removal of the PADEP low-RVP rule (which covered the entire Pittsburgh-Beaver Valley Area from the SIP, including Allegheny County) continues to show that removal of state and local 7.8 RVP gasoline requirements will not interfere with the attainment or maintenance of any NAAQS in the area. Thus, the removal of the 7.8 psi low RVP fuel program requirements in the Allegheny County portion of the Pittsburgh-Beaver Valley Area does not interfere with Pennsylvania's ability to demonstrate compliance with any NAAQS. Based on the May 2018 PADEP CAA 110( l ) noninterference analysis approved by EPA and reevaluated by EPA in this action (which is included as a supporting element of the March 2019 SIP revision), EPA concludes that the current action to remove the 7.8 psi RVP fuel requirement in Allegheny County will not negatively impact the Pittsburgh-Beaver Valley Area's ability to attain or maintain any NAAQS or interfere with reasonable further progress or with any other CAA applicable requirement.

EPA received comments from six separate commenters on our April 26, 2019 (84 FR 17762) proposed action. One of these commenters was supportive of EPA's proposed action, while the rest opposed at least some aspects of our proposed rulemaking. EPA's summary of the significant adverse comments received during the public comment period for the proposed rulemaking and our responses to those comments are listed below.

Comment 1: (EPA-R03-OAR-2019-0144-0020) The commenter notes that EPA granted a federal “preemption waiver” under section 221 (sic) (Title II) of the CAA but does not explain why that waiver is now being revoked. The commenter contends that EPA is on a march to deregulate and remove CAA protections to make sure areas such as Pittsburgh don't (sic) violate Federal VOC and ozone standards. The commenter recommends that EPA disapprove the Commonwealth's request to remove the Allegheny County 7.8 psi RVP program from the SIP until the preemption waiver is resolved. The commenter suggests that if a preemption waiver is no longer warranted, EPA must formally remove the preemption waiver from the SIP before EPA can remove the County low-RVP gasoline program from the SIP.

Response 1: EPA believes the commenter is referring to exclusive federal control over the regulation of fuels and fuel additives granted by section 211 of the CAA. Specifically, CAA section 211(c)(4)(A) preempts state fuel controls that are different from federal fuel controls and provides exceptions to exclusive federal regulation that include a waiver of preemption. Under CAA section 211(c)(4)(A), states (or political subdivisions thereof) are generally prohibited from prescribing, for purposes of motor vehicle emission control, any control of a component of a fuel or fuel additive for use in a motor vehicle engine. However, under CAA section 211(c)(4)(C), a state may regulate fuel or fuel additives if it adopts such a measure as part of a SIP, but EPA may only approve such a program into a SIP after finding that the state or local control is necessary to achieve a primary or secondary NAAQS and if there are no other measures that would bring about timely attainment. Section 211(c)(4)(C)(i). EPA waived preemption and approved the Commonwealth's SIP requiring use of 7.8 psi RVP gasoline during summer months in the Pittsburgh-Beaver Valley Area (including Allegheny County) in two separate SIP revisions in 1998 and 2001. 2 It is the 2001 SIP approval requiring the use of low-RVP fuel in the Allegheny County portion of the Pittsburgh-Beaver Valley Area that the County is now seeking to remove from the SIP. On April 26, 2019 (84 FR 17764), EPA proposed to approve the County request to remove the use of low-RVP fuel in the Allegheny County portion of the Pittsburgh-Beaver Valley Area from the SIP. As explained earlier, EPA approval of a state fuel measure entails the waiver of preemption contained in CAA 211(c)(4)(C)(i). Under this provision, EPA may approve state fuel controls in a SIP if EPA determines that the fuel control is necessary to achieve the NAAQS that the SIP implements.

In sum, the Agency is required to consider CAA section 211(c)(4)(C) requirements when approving a state or local fuel control program that would serve in lieu of the otherwise applicable Federal fuel control program. EPA can only waive preemption if the requirements of CAA section 211(c)(4)(C)(i) and (v) are met. Nothing in these provisions, however, preclude either a state or local government from subsequently removing an approved state fuel measure. 3 Thus, there is no requirement for a “waiver” to remove the 7.8 psi RVP requirement from either the Allegheny County portion or the Pennsylvania portion of the SIP. Instead, as shown in Section III of this rulemaking action, Allegheny County or Pennsylvania need only comply with CAA section 110( l) given that the removal of 7.8 psi RVP requirement entails a SIP revision. As previously explained, CAA section 110( l ) prohibits EPA from approving any SIP revision if such revision would interfere with any applicable requirement concerning attainment and reasonable further progress (as defined in section 171), or any other applicable requirement of the CAA.

The 7.8 psi state and local rules were cited as control measures that contributed to ozone reduction in Pennsylvania's April 9, 2001 maintenance plan supporting the Commonwealth's request for redesignation to attainment of the 1979 1-hour ozone NAAQS, which EPA approved on October 19, 2001 (66 FR 53094). In that same final rule, EPA determined that the Pittsburgh-Beaver Valley Area had attained the 1-hour ozone NAAQS by its legal attainment deadline, based on three years of air quality data. On the basis of that determination, EPA found that an attainment demonstration (and other related requirements under Part D of Title I of the CAA) were not applicable requirements under the CAA for the Pittsburgh-Beaver Valley 1-hour ozone nonattainment area. The Commonwealth's reasonable further progress plan for the Pittsburgh-Beaver Valley Area was prepared prior to adoption of the 7.8 psi RVP rule, and therefore did not include reductions from that measure to demonstrate progress towards achievement of the NAAQS. Therefore, EPA believes the only requirement that must be satisfied prior to removing an EPA approved state or local fuel control measure are the provisions of CAA section 110 related to SIP actions—and specifically the required showing that EPA approval of a revision to the SIP does not interfere with any applicable requirement concerning attainment and reasonable further progress towards attainment, or other applicable CAA requirement.

Comment 2: (EPA-R03-OAR-0144-0016) The commenter contends that in the proposed action, EPA certifies that the action does not have a significant economic impact on a substantial number of small entities, but that comments submitted by Sunoco LLC during the County's rule adoption asserted that the rule revision will “have economic advantages to both citizens and businesses of the Pittsburgh-Beaver Valley area.” The commenter asks how EPA can certify that the action has no significant economic impact if one of the nation's largest oil producers emphasized the economic savings and asks to see EPA's analysis showing that removal of the program does not significantly impact small entities.

Response 2: EPA does not agree that it is required to assess the economic impact of approving Allegheny County's request to remove the low-RVP gas requirement from the Allegheny County portion of the Pennsylvania SIP. As explained in the introductory sentences to the Statutory and Executive Order Reviews section of the NPRM:

EPA's approval of the State's request to remove from the SIP the requirement to use low-RVP gasoline in Allegheny County merely approves an enacted state law (ACHD's removal of the low-RVP requirement from Allegheny County's regulations) as meeting the Federal CAA requirements and does not impose any additional requirements beyond those already imposed by state law. For this reason, EPA's action in approving this SIP revision does not have a significant impact under the Regulatory Flexibility Act.

Comment 3: (EPA-R03-OAR-0144-0016) The commenter contends that EPA failed to require a noninterference demonstration for the revoked 1-hour ozone NAAQS. The commenter argues that PADEP's noninterference demonstration (prepared by PADEP as part of its April 2018 SIP revision, supporting removal of both State and County low-RVP gasoline rules from the SIP) contains photochemical grid modeling that addresses only the 2008 8-hour ozone NAAQS and not the prior, revoked 1-hour ozone NAAQS. The commenter argues that because the 1-hour ozone standard is based on a substantially different averaging time and exceedance framework than the 8-hour NAAQS, EPA must ensure that removal of an area-wide requirement (low-RVP fuel) is protective, as EPA claims.

Response 3: The Commonwealth's CAA 110( l ) demonstration focused on demonstrating that current air quality can be maintained for all NAAQS without continuation of the existing 7.8 psi RVP gasoline control measure. The basis for the Commonwealth's demonstration is through substitution of equivalent or greater reductions in primarily VOC and NO X emissions from other measures to offset the VOC and NO X reductions that would no longer be achieved upon removal of the 7.8 psi RVP gasoline control measure.

In evaluating whether a SIP revision would interfere with maintenance or attainment, EPA generally considers whether the SIP revision will allow for an increase in actual emissions into the air over what is allowed under the existing EPA-approved SIP. In assessing compliance with CAA section 110( l ), EPA treats each submission as a unique case, reviewing and acting upon each one on a case-by-case basis through regional SIP action. However, EPA did broach the subject of compliance with CAA 110( l ) noninterference in guidance prepared specifically for removal of another control measure, entitled “ Guidance on Removing Stage II Gasoline Vapor Control Programs from State Implementation Plans and Assessing Comparable Measures,” August 7, 2012 [EPA-457/B-12-001]. Therein, EPA stated that it could propose to approve a SIP revision that removes or modifies a control measure if there is a basis in the state's submittal for concluding that the SIP revision does not interfere with attainment or maintenance of any NAAQS or requirements related to reasonable further progress towards attainment of a NAAQS. Suggested methods listed in that guidance document for demonstrating noninterference include: (1) Substitution of new control measures that offset the reductions of the pollutants addressed by the prior plan; (2) offset of emissions due to excess emission reductions not accounted for in the current SIP; or (3) emissions increases that are shown not to interfere with attainment. Pennsylvania has demonstrated that the emission reductions achieved by the 7.8 low RVP gasoline program have been offset by emission reduction measures not previously quantified or claimed in the approved SIP, and EPA approved the Commonwealth's noninterference demonstration for the entire Pittsburgh-Beaver Valley Area as part of our December 20, 2018 final rule approving the Commonwealth's removal of the PADEP 7.8 psi low-RVP control measure from the SIP (a measure that applied to the 7-county Pittsburgh-Beaver Valley Area, including Allegheny County).

As the commenter noted, the 1-hour ozone NAAQS was revoked by EPA under the Agency's requirements for implementation of the 1997 ozone NAAQS. 40 CFR 50.9(b), 62 FR 38894 (July 18, 1997), 69 FR 23951, 23969 (April 30, 2004). The 1-hour ozone NAAQS was no longer applicable in the Pittsburgh-Beaver Valley Area as of June 15, 2005. We need not consider whether this SIP revision interferes with the revoked 1-hour NAAQS. By definition, a revision cannot interfere with something that is no longer in effect, such as a revoked NAAQS. EPA has dealt with the anti-backsliding concerns related to revoked NAAQS by promulgating regulations to address that issue. Thus, so long as the anti-backsliding requirements in the ozone-requirements rule are met, further demonstration of noninterference under 110( l ) are not necessary.

Comment 4: (EPA-R03-OAR-0144-0016) The commenter asks why EPA would remove a measure that achieves VOC reductions for a county that EPA has designated nonattainment for the 2012 PM 2.5 NAAQS, when VOC reductions could help the area attain the PM 2.5 NAAQS, because VOCs can be precursors to PM 2.5 formation. The commenter contends that EPA should not allow Allegheny County to remove the low-RVP gasoline program from the SIP until it has been shown that the area is able to meet the PM 2.5 NAAQS without the additional VOC reductions achieved by this rule.

Response 4: Section 110( l ) of the CAA prohibits EPA from approving a plan revision ” . . . if the revision would interfere with any applicable requirement concerning attainment and reasonable further progress, . . . or any other applicable requirement of this chapter.” In this SIP revision, EPA believes that the noninterference demonstration submitted by PADEP for the entire Pittsburgh-Beaver Valley Area does show that the small emission increase of VOCs resulting from removal of the low-RVP gasoline requirement are more than offset by reductions in VOC emissions from the shutdown of the Guardian Glass facility and the adoption of new limits on solvents, paints and adhesive adopted by Pennsylvania. In EPA's guidance on removing stage II gasoline vapor recovery controls, EPA lays out several alternative means of assessing noninterference. Therein, EPA specifically states, “In evaluating whether a given SIP would interfere with attainment or maintenance, . . . EPA generally considers whether the SIP revision will allow for an increase in actual emissions into the air over what is allowed under the existing EPA-approved SIP. The EPA has not required that a state produce a new, complete attainment demonstration for every SIP revision, provided that the status quo air quality is preserved. See, e.g., Kentucky Resources Council, Inc, v. EPA, 467 F.3d 986 (6th Cir. 2006). 4 ”

Pennsylvania has demonstrated noninterference with all NAAQS through primarily an emissions substitution approach, using methods prescribed by EPA guidance under section 110( l ) of the CAA. EPA approved Pennsylvania's CAA section 110( l ) noninterference demonstration for the entire Pittsburgh-Beaver Valley Area (including Allegheny County) on December 20, 2018 (83 FR 65301).

Comment 5: (EPA-R03-OAR-2019-0144-0021) Commenter notes that in Pennsylvania's prior SIP revision requesting removal of the state's low-RVP gasoline rule applicable to the Pittsburgh-Beaver Valley Area, PADEP stated that it wished to retain any remaining balance of creditable emission reductions from the permanent closure of the Guardian Industries glass manufacturing facility located in Allegheny County, Pennsylvania. However, EPA's proposed approval of this prior SIP action states that no remaining balance of credits would be held by the state, and EPA's final action did not address whether the remaining balance of creditable emission reductions were forfeited or retained by Pennsylvania. The commenter requests that EPA clarify whether the remaining balance of emission reductions are retained by Pennsylvania for future use and quantify how many remain and/or are forfeited, so that there is no future double counting of these emissions reductions.

Response 5: EPA received a similar comment in response to our proposal to approve removal of PADEP's 7.8 psi RVP gasoline program from the non-Allegheny County portions of the Pittsburgh-Beaver Valley Area. 5 In our final December 2018 rulemaking for the Pittsburgh-Beaver Valley Area 7.8 psi RVP program SIP removal action, EPA clarified that emission reduction from Guardian Glass closure remained available. The Guardian Glass facility permanently ceased operation in August 2015 but did not request that potentially creditable emission reductions be preserved in the emission inventory within one year of closure, which is a prerequisite for their use as emission reduction credits (ERCs) for nonattainment new source review (NNSR) purposes under Pennsylvania's rules governing that program (25 Pa. Code 127.207(2)). As a result, the reductions are no longer eligible for future use as ERCs for NNSR offset purposes, but they remain available for other uses. As EPA stated in our December 20, 2018 final rule, because these surplus emission reductions no longer qualify as ERCs under Pa. Code Chapter 127, Subchapter E, EPA believes they do not need to be memorialized in either a state plan approval, or a SIP revision or emission inventory. The facility's permits are no longer valid, and reactivation of the facility would be subject to NNSR and re-permitting.

However, that does not mean that these remaining emission reductions from closure of this facility have no use. PADEP reserved the right to request consideration of these reductions for future use for other SIP planning purposes other than NNSR offsets—potentially as part of a future demonstration relating to NAAQS planning requirements. Any such future use would require a SIP revision at that time, with a demonstration of the emission reductions viability for use in any future SIP revision. Although PADEP quantified the remaining reductions that are surplus after offsetting removal of the low-RVP gasoline program, the surplus reduction quantities listed in EPA's December 20, 2018 SIP action are not directly translatable to any future SIP planning use. Any future use of the remaining emission reductions would need to be reevaluated as part of a subsequent SIP action supporting their potential use at that time for SIP planning purposes.

EPA does not agree that it must quantify the remaining surplus or the amount that should be forfeited as part of this action. EPA has clarified its position that these reductions can no longer be used for NNSR offset purposes under the relevant state rule. EPA cannot memorialize the remaining emission reductions potentially available for future SIP purposes as the reductions must be re-evaluated in the context of the specific SIP action for which the Commonwealth wishes to use the reductions.

Comment 6: (EPA-R03-OAR-2019-0144-0019) The commenter argues that EPA and Allegheny County have not provided an adequate demonstration that removal of the low-RVP gasoline program will not interfere with attainment of the PM 2.5 NAAQS, because VOCs are a precursor to formation of ambient PM 2.5 . The commenter contends that PADEP should perform modeling regarding the impacts of the removal of the RVP requirement, rather than simply comparing overall emissions increases and decreases of VOCs. Commenter claims that the submitted noninterference analysis only compares the magnitude of emissions reductions from the 2015 shutdown of the Guardian Industries facility and reductions from a regulation for control of VOCs from adhesives, sealants, primers, and solvents, promulgated by DEP, to the magnitude of the emissions increases from discontinuation of the low-RVP requirement. The commenter notes that Allegheny County has continued to be in nonattainment with the PM 2.5 standards despite the fact that the reductions in emissions relied upon by PADEP's analysis occurred prior to 2016. Commenter believes this continued nonattainment despite the reductions from earlier shutdowns and regulatory changes means the Department should be looking more closely at local impacts from regulatory initiatives rather than offsetting emissions at different locations.

Response 6: EPA is not evaluating the adequacy of the state's separate, ongoing efforts to develop an appropriate attainment area plan for the 2012 PM 2.5 NAAQS for the Allegheny County nonattainment area in this action. The commenter's concerns with respect to the modeling and monitoring analyses contained in the state's draft PM 2.5 attainment plan are not relevant to EPA's action to remove the 7.8. psi RVP rule from the SIP, and as such do not warrant consideration in this final rule. As indicated in response to a prior comment, in evaluating whether a SIP revision ( e.g., removal of an existing rule from the SIP) would interfere with attainment or maintenance of a NAAQS, per CAA section 110( l ), EPA generally considers whether the SIP revision will allow for an increase in actual emissions in the air over what is allowed under the existing approved SIP, in an attempt to ensure that the status quo with regard to air quality is maintained. The EPA has not required that a state produce a new complete attainment demonstration for every SIP revision, provided that the status quo air quality is preserved. 6

EPA has reviewed the Commonwealth's noninterference demonstration for this action to remove the 7.8 psi RVP rule from the Pennsylvania SIP and determined that the provided analysis shows that the emissions from removal of that rule have been fully offset by substitute reductions in VOCs and NO X from other measures not already in the approved SIP, and this analysis included consideration of the PM 2.5 NAAQS. 7 EPA believes that it would be inappropriate to evaluate the removal of the ACHD low-RVP rule from the SIP in this action premised upon the potential approvability of the County's proposed Allegheny County PM 2.5 attainment plan, as that plan is currently out for public comment by the County and may change in response to any comments received before it is formally submitted to EPA as a SIP revision. EPA is not evaluating the adequacy of the state's separate ongoing efforts to develop an appropriate attainment plan for the 2012 PM 2.5 NAAQS for the Allegheny County nonattainment area in this action. Further, the commenter's concern with respect to the modeling and monitoring analyses contained in the Commonwealth's draft PM 2.5 attainment plan is not relevant to EPA's action to remove the 7.8. psi RVP rule from the SIP, and as such do not warrant consideration in this final rule.

Therefore, EPA is not directly addressing the merits of these comments in this action and recommends that the commenter submit its comments to the County during the County's current administrative process and also during any future action EPA may take on that plan after the state formally submits the ultimate plan to EPA as a SIP revision. ACHD intends to submit to EPA a PM 2.5 attainment plan which will address the PM 2.5 issue. The proper place to evaluate how to achieve PM 2.5 attainment is in response to that plan.

Comment 7: The commenter contends that PADEPs approach of direct substitution of emissions of pollutants with reductions associated with other measures is inadequate to ensure that there is no increase in ambient pollution concentrations from such an approach, and that ambient concentration modelling is warranted to ensure NAAQS noninterference or other CAA requirements, such as potential impact on regional haze.

Response 7: While ambient concentration modeling is necessary for an attainment plan, it is not necessary to demonstrate attainment for purposes of amending the SIP to remove a rule. As was discussed in response to a prior comment, noninterference is the only CAA required test for removal of a rule that is not mandatory under the CAA, nor an applicable Part D measure mandated by the law. In demonstrating noninterference under CAA 110( l ), ambient concentration modeling to show the impact of the removal of a rule is but one possible test of noninterference—albeit not a required one. Direct substitution of other measures that achieve equivalent emissions reductions to offset the removed measure is an allowable method of demonstrating CAA 110( l ) noninterference.

Comment 8: (EPA-R03-OAR-2019-0144-0149) The commenter contends that removal of the low-RVP requirements may affect the control strategy for the PM 2.5 attainment demonstration. The commenter claims that PADEP should strengthen its control strategy to reduce concentrations of fine particulates presenting harm to individuals rather than finessing attainment by ignoring data at the Liberty monitor through mis-interpretation of an EPA guidance document. Among other things, that control strategy could include the continuation of the RVP requirements, depending on the results of a proper factual analysis.

Response 8: EPA believes that this comment should be addressed to ACHD's proposed attainment plan for the 2012 PM 2.5 NAAQS for Allegheny County, rather than to this action to remove the ACHD low-RVP measure from the SIP. The PM 2.5 attainment plan is currently undergoing the County's public comment process and has not yet been formally submitted to EPA as a SIP revision. As such, this comment should be submitted during ACHD's public comment period for the PM 2.5 attainment plan. Concerns raised by the commenter with respect to whether the area has actually attained the PM 2.5 standard or done so in a timely manner, or whether ACHD has followed EPA guidance related to the monitoring or modeling analyses that underlie that demonstration, are not relevant to EPA's current action regarding whether to approve the Commonwealth's request for removal the 7.8. psi RVP gasoline rule from the SIP.

Comment 9: Commenter claims the PM 2.5 Attainment Demonstration is flawed because it relies on unrepresentative meteorological data from the base year 2011 (p.4). Commenter alleges that the 2011 meteorological data contains the second lowest number of inversions (134) in a year, which is lower than the typical number of inversions in the last ten years (157). Also, commenter states that PADEP's claim that the 2011 data is more representative of normal years because the Pittsburgh area has had above normal temperatures and above normal levels of precipitation in “recent years” is not supported by the data.

Response 9: As explained above, this comment concerns the PM 2.5 attainment demonstration, rather than this SIP action, and EPA will therefore not address this comment here because it is beyond the scope of this rulemaking action.

Comment 10: Commenter claims that future emissions inventories for the proposed attainment demonstration may not be complete and accurate because RVP 7.8 psi compliant fuel was burned in the past but will not be burned in the future and it is not clear how or whether VOC emissions from the higher RVP fuels that will be burned in the future are tracked or accounted for in the future emission inventory. Some stationary sources have stored fuel with varying RVP, ranging from 7 psi to 13 psi. See Appendix D (Emissions Inventories) to Proposed Attainment Demonstration. At a minimum, there is a factual question regarding the degree to which the removal of the RVP requirements will affect the formation of fine particulates.

Response 10: Because this comment is questioning how the removal of low-RVP fuel will affect the emissions inventory for the PM 2.5 attainment demonstration, EPA believes it should be submitted as a comment on that plan. EPA believes it would be more appropriate to respond to this comment, if submitted as a comment on any action EPA proposes on ACHD's PM 2.5 attainment plan, in the context of responding to comments on that plan.

Section 1541(b) of the Energy Policy Act of 2005 required EPA, in consultation with the U.S. Department of Energy, to determine the number of fuels programs approved into all SIPs as of September 1, 2004 and to publish a list of such fuels. On December 28, 2006 (71 FR 78192), EPA published the list of boutique fuels. EPA maintains the current list of boutique fuel programs on its website at: https://www.epa.gov/gasoline-standards/state-fuels. The final list of boutique fuels was based on a fuel type approach. CAA section 211(c)(4)(C)(v)(III) requires that EPA remove a fuel from the published list if it is either identical to a Federal fuel or is removed from the SIP in which it is approved. Under the adopted fuel type approach, EPA interpreted this requirement to mean that a fuel would have to be removed from all states' SIPs in which it was approved in order to remove the fuel type from the list. (71 FR 78195, December 28, 2006).

The 7.8 psi RVP fuel program is a fuel type that is included in EPA's boutique fuel list (published at 71 FR 78198, December 28, 2006, and maintained online at: https://www.epa.gov/gasoline-standards/state-fuels ). Subsequent to the final effective date of EPA's approval of Pennsylvania's March 19, 2019 SIP revision to remove the ACHD rule under Article XXI, EPA will update the State Fuels and Gasoline Reid Vapor Pressure web pages with the effective date of the SIP removal. At that time, the entry for Pennsylvania will be deleted from the list of boutique fuels, because Allegheny County was the final remaining 7.8 psi RVP program area in the Commonwealth of Pennsylvania. However, the boutique fuels list will retain the 7.8 psi RVP fuel type, as this fuel program type continues to be in other state SIPs.

EPA is approving Pennsylvania's March 19, 2019 SIP revision requesting the removal of ACHD's 7.8 psi RVP summer gasoline program for Allegheny County (under Article XXI of the Rules and Regulations of the Allegheny County Health Department; amended February 21, 2019, effective March 3, 2019) from the Pennsylvania SIP. Our approval of the March 19, 2019 SIP revision is being taken in accordance with CAA requirements in section 110.

Section 553(d) of the Administrative Procedure Act (APA), 5 U.S.C. Chapter 5, generally provides that rules may not take effect earlier than 30 days after they are published in the Federal Register . EPA is issuing this final rule under CAA section 307(d)(1) which states: “The provisions of section 553 through 557 . . . of Title 5 shall not, except as expressly provided in this subsection, apply to actions to which this subsection applies.” Thus, section 553(d) of the APA does not apply to this rule. EPA is nevertheless acting consistently with the policies underlying APA section 553(d) in making this rule effective on July 5, 2019. APA section 553(d) allows an effective date less than 30 days after publication for a rule “that grants or recognizes an exemption or relieves a restriction.” 5 U.S.C. 553(d)(1). This rule fits within that exception because it lifts a restriction on the introduction into commerce of gasoline with an RVP of greater than 7.8 psi sold in Allegheny County, Pennsylvania between June 1 and September 15 of each year. Because ACHD adopted this rule in February 2019 (just prior to the commencement of the May 1 regulatory compliance deadline requiring use of low-RVP fuel in the Summer 2019 fuel season) and then submitted the rule to EPA in March 2019, EPA's final action will coincide with the summer low-RVP compliance period, resulting in supply chain uncertainty for affected gasoline refining, distribution, and retail industries. Additionally, the effective date for ACHD's revocation of the low-RVP gasoline requirement is based upon EPA's final rulemaking effective date, creating further industry uncertainty with respect to regulatory compliance in the time prior to EPA's final rule effective date. Therefore, this action can be considered to relieve a restriction that would otherwise prevent the introduction into commerce of gasoline with an RVP of greater than 7.8 psi. By setting the effective date of this action to the date of final rule publication, EPA could alleviate potential supply disruption that might occur due to the timing of this action during the 2019 summer fuel control season. Therefore, EPA is making this action to remove the Allegheny County program from the Pennsylvania SIP effective on July 5, 2019.

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

• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);

• Is not an Executive Order 13771 (82 FR 9339, February 2, 2017) regulatory action because SIP approvals are exempted under Executive Order 12866.

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

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

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

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

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

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

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

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

In addition, this 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.

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

Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by September 3, 2019. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action.

This action to approve Pennsylvania's request for removal of summer season 7.8 psi RVP gasoline requirements for Allegheny County from the SIP may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

40 CFR part 52 is amended as follows:

Docket. The EPA has established a docket for this rulemaking under Docket ID No. EPA-HQ-OAR-2018-0851. All documents in the docket are listed in Regulations.gov . Although listed, some information is not publicly available, e.g., Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the internet and will be publicly available only in hard copy. Publicly available docket materials are available either electronically in Regulations.gov or in hard copy at the EPA Docket Center, Room 3334, WJC West Building, 1301 Constitution Avenue NW, Washington, DC. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Public Reading Room is (202) 566-1744, and the telephone number for the EPA Docket Center is (202) 566-1742.

Instructions. Direct your comments to Docket ID No. EPA-HQ-OAR-2018-0851. The EPA's policy is that all comments received will be included in the public docket without change and may be made available online at https://www.regulations.gov/, including any personal information provided, unless the comment includes information claimed to be CBI or other information whose disclosure is restricted by statute. Do not submit information that you consider to be CBI or otherwise protected through https://www.regulations.gov/ or email. This type of information should be submitted by mail as discussed below.

The EPA may publish any comment received to its public docket. Multimedia submissions (audio, video, etc.) must be accompanied by a written comment. The written comment is considered the official comment and should include discussion of all points you wish to make. The EPA will generally not consider comments or comment contents located outside of the primary submission ( i.e., on the web, cloud, or other file sharing system). For additional submission methods, the full EPA public comment policy, information about CBI or multimedia submissions, and general guidance on making effective comments, please visit https://www.epa.gov/dockets/commenting-epa-dockets.

The https://www.regulations.gov/ website allows you to submit your comment anonymously, which means the EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an email comment directly to the EPA without going through https://www.regulations.gov/, your email address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the internet. If you submit an electronic comment, the EPA recommends that you include your name and other contact information in the body of your comment and with any digital storage media you submit. If the EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, the EPA may not be able to consider your comment. Electronic files should not include special characters or any form of encryption and be free of any defects or viruses. For additional information about the EPA's public docket, visit the EPA Docket Center homepage at https://www.epa.gov/dockets.

Submitting CBI. Do not submit information containing CBI to the EPA through https://www.regulations.gov/ or email. Clearly mark the part or all of the information that you claim to be CBI. For CBI information on any digital storage media that you mail to the EPA, mark the outside of the digital storage media as CBI and then identify electronically within the digital storage media the specific information that is claimed as CBI. In addition to one complete version of the comments that includes information claimed as CBI, you must submit a copy of the comments that does not contain the information claimed as CBI directly to the public docket through the procedures outlined in Instructions above. If you submit any digital storage media that does not contain CBI, mark the outside of the digital storage media clearly that it does not contain CBI. Information not marked as CBI will be included in the public docket and the EPA's electronic public docket without prior notice. Information marked as CBI will not be disclosed except in accordance with procedures set forth in 40 Code of Federal Regulations (CFR) part 2. Send or deliver information identified as CBI only to the following address: OAQPS Document Control Officer (C404-02), OAQPS, U.S. Environmental Protection Agency, Research Triangle Park, North Carolina 27711, Attention Docket ID No. EPA-HQ-OAR-2018-0851.

Organization of this document. The information in this preamble is organized as follows:

The EPA is publishing this direct final rule without a prior proposed rule because we view this as a noncontroversial action and do not anticipate significant adverse comment. However, in the “Proposed Rules” section of this Federal Register , we are publishing a separate document that will serve as the proposed rule to amend the Standards of Performance for Stationary Compression Ignition Internal Combustion Engines, if the EPA receives significant adverse comments on this direct final rule. EPA does not intend to institute a second comment period on this action. Any parties interested in commenting must do so at this time. For further information about commenting on this rule, see the ADDRESSES section of this document. If the EPA receives significant adverse comment on all or a distinct portion of this direct final rule, we will publish a timely withdrawal in the Federal Register informing the public that some or all of this direct final rule will not take effect. We would address all public comments in any subsequent final rule based on the proposed rule.

On July 11, 2006, the EPA promulgated Standards of Performance for Stationary Compression Ignition Internal Combustion Engines (71 FR 39154). These standards, known as new source performance standards (NSPS), implement section 111(b) of the Clean Air Act. The standards apply to new stationary sources of emissions, i.e., sources whose construction, reconstruction, or modification begins after a standard for those sources is proposed. The NSPS for Stationary CI Internal Combustion Engines established limits on emissions of PM, nitrogen oxides (NO X ), carbon monoxide (CO) and non-methane hydrocarbons (NMHC). The emission standards are generally modeled after the EPA's standards for nonroad and marine diesel engines. The emission standards are phased in over several years and have Tiers with increasing levels of stringency, with Tier 4 as the most stringent level. The engine model year in which the Tiers take effect varies for different size ranges of engines. The Tier 4 final standards for new stationary non-emergency and nonroad CI engines generally began with either the 2014 or 2015 model year. The standards are codified at 40 CFR part 60, subpart IIII.

In 2011, the EPA finalized revisions to the NSPS for Stationary CI Engines (the “2011 Amendments”) that amended the standards for engines located in remote areas of Alaska (76 FR 37954). The 2011 Amendments allowed owners and operators of stationary CI engines located in remote areas of Alaska to use engines certified to marine engine standards, rather than land-based nonroad engine standards. The 2011 Amendments also removed the requirements to meet Tier 4 emission standards for NO X , CO, and NMHC that would necessitate the use of selective catalytic reduction (SCR) aftertreatment devices in light of issues associated with supply, storage, and use of the necessary chemical reductant (usually urea) in remote Alaska. 1 As discussed in the 2011 rulemaking, the remote communities in Alaska rely almost exclusively on diesel engines for electricity and heat and these engines need to be in working condition, particularly in the winter. These communities are scattered over long distances in remote areas and are not connected to population centers by road and/or power grid. Most of these communities are located in the most severe arctic environments in the United States. The costs for acquisition, operation, and maintenance of SCR aftertreatment controls are greater than for engines located elsewhere in the United States due to the remote location and severe arctic climate of the villages. The aftertreatment controls had not been tested in remote arctic climates, and engine owners and operates were concerned that there could be operational problems with the SCR aftertreatment systems in the remote arctic climates that could prevent stationary CI engines from functioning properly, especially since the majority of small power plants in remote areas are unstaffed. Given these concerns and the higher costs for SCR aftertreatment systems in the remote areas, the EPA determined in the 2011 Amendments that it would not be appropriate to require new stationary CI engines in remote areas of Alaska to meet emission standards for NO X , CO, and NMHC that are based on the use of SCR aftertreatment devices.

For PM, the 2011 Amendments specified that stationary CI engines located in remote areas of Alaska would not have to meet emission standards that would necessitate the use of aftertreatment devices until the 2014 model year. The aftertreatment technology that was expected to be used to meet the PM standards is a diesel particulate filter (DPF). The EPA expected that providing additional time to gain experience with use of DPFs would alleviate some of the concerns associated with feasibility and costs of installing and operating DPFs in remote villages. In a letter to the EPA Administrator dated December 20, 2017, Governor Bill Walker of Alaska requested that the EPA rescind the PM emission standards based on aftertreatment for 2014 model year and later stationary CI engines in remote areas of Alaska. The letter stated that it is difficult to operate and maintain PM aftertreatment controls on stationary CI engines in remote areas of Alaska because of cost, complexity, and unreliability. According to the letter, utilities in remote areas have been installing used, remanufactured, and rebuilt pre-2014 model year engines in the remote areas to avoid the requirement to use PM aftertreatment, instead of installing new engines that meet the Tier 3 marine engine standards. The EPA's expectation that experience with use of DPFs would alleviate feasibility and cost concerns was not realized and the requirement that 2014 model year and later engines use DPFs had in fact resulted in use of older engines. The letter indicated that new engines certified to the Tier 3 marine engine standards are notably cleaner than the non-certified engines currently in use in remote areas of Alaska, due to advances in diesel engine electronic fuel injection and electronic governors.

After receiving the letter from Governor Walker, the EPA contacted the Alaska Department of Environmental Conservation and the Alaska Energy Authority (AEA) to obtain more information about the issues described in the letter. In particular, the EPA asked for information regarding the state's concerns about the cost, complexity, and reliability of DPFs, as expressed in Governor Walker's letter. The EPA also asked for information on the number of stationary CI engines that are installed in remote areas of Alaska each year and whether any stationary CI engines with DPFs were currently operating in the remote areas. The AEA indicated that owners and operators of engines in rural communities have been delaying replacement of older engines because of the cost and concerns about having to install new engines with DPFs. As stated in Governor Walker's letter, the communities are using rebuilt older engines rather than installing new marine Tier 3 engines that would be lower-emitting and more efficient.

As noted previously, the communities in remote areas of Alaska are not accessible by the Federal Aid Highway System and/or not connected to the statewide electrical grid referred to as the Alaska Railbelt Grid. They are isolated and most are located in the most severe arctic environments in the United States. It is critical for the engines in the communities to remain in working order since the engines are used for electricity and heating. Information provided by the AEA and engine dealers indicates that costs for engine and control device maintenance and repair are much higher than for engines located elsewhere in the United States due to the remote location and severe arctic climate. Technicians must travel to the remote areas for service and repairs, and travel costs for technicians and shipping costs for parts are much higher than in other areas. Information provided by the AEA indicated that travel costs can include chartering aircraft and can be approximately $3,000-$4,000 per trip, in addition to daily labor costs. 2 The travel time can range from 25 to 99 percent of the total labor invested in a job. 3 In addition to increased maintenance costs, a control device vendor indicated that costs for DPF installation on an engine in remote areas of Alaska can be more than double the costs for an engine in Texas. 4 The remote communities also have a shortage of operators who are trained for the DPF equipment. Typically, the filter element must be periodically removed and the accumulated ash must be cleaned from the filter and captured. The AEA indicates that few communities have the technical capacity to perform the necessary cleaning procedures for DPFs. Another concern related to the remote location is the difficulty and expense associated with proper disposal of the ash collected by the DPF and used filters in hazardous waste disposal facilities. The ash can contain metallic oxides which are hazardous to the environment or to public health. 5

According to the AEA, experience with the use of DPFs in remote areas of Alaska is very limited. The AEA was aware of only one remote community that has installed DPFs on two engines in a power plant. The DPFs were installed in April 2018, so there has not been experience with the long-term operation of the engines and DPFs. The AEA noted that rather than having the emission controls integrated with the certified engine, as is typical for Tier 4 engines, the remote communities will have to purchase Tier 3 marine certified engines and equip the engines with DPFs that may come from third parties and are not integrated into the engine's computer system, which may increase the likelihood of problems occuring that could cause the engine to shut down. As stated previously, the engines are generally used for heating in the villages, so unexpected engine shutdowns could cause life safety issues. Providers of engines and emission controls in Alaska noted that they have experienced operational issues with nonroad and stationary Tier 4 engines with DPFs in other areas of Alaska, even when the controls were integrated with the engine by the original equipment manufacturer. For example, one provider noted that he serviced two Tier 4 engines that required numerous service calls and the addition of a parasitic load bank to maintain exhaust temperatures high enough for DPF regeneration, which increased fuel consumption and operating costs. 6 Another provider stated that they sold a number of nonroad Tier 4 engines equipped with DPFs that met extensive factory tests for reliability and durability, but experienced numerous problems with regeneration of the DPF once they were in-use by operators. 7

After considering all of the information provided, including the information provided on the lack of experience with the use of DPFs on engines in remote areas of Alaska, the potential for operational issues, and the higher costs, the EPA has determined that such use of DPFs is not adequately demonstrated and is revising the provision in 40 CFR 60.4216 for 2014 model year and later stationary CI engines in remote areas of Alaska. The EPA is amending the provision to specify that 2014 model year and later stationary CI engines in remote areas of Alaska must be certified to Tier 3 p.m. standards. The EPA has determined that the Tier 3 standards reflect the best system of emission reduction that has been adequately demonstrated. The Tier 3 standards will limit emissions of PM to levels significantly below those of the older uncertified engines currently in use in many of the remote communities.

A detailed discussion of the impacts of these amendments can be found in the Impacts of the Amendments to the NSPS for Stationary Compression Ignition Internal Combustion Engines memorandum, which is available in the docket for this action. In the original 2006 rulemaking, the EPA assumed that even in the absence of the NSPS, emissions from stationary engines would be reduced to the same emission levels as nonroad engines through Tier 3, since engine manufacturers frequently use the same engine in both nonroad and stationary applications. Emission reductions and costs were only estimated for the difference between compliance with the Tier 3 standard and compliance with the Tier 4 standard in the original rulemaking. 8 Using a similar assumption, the foregone PM reductions and costs from these amendments are calculated based on the difference in emissions between the engines that are expected to be used once these amendments are finalized, which are Tier 3 marine engines, and the engines currently required by the regulations (known as the baseline), which are Tier 3 engines (either nonroad or marine) with a DPF. If the baseline is assumed to be a Tier 3 nonroad engine with a DPF, then the foregone PM reductions based on the difference between a Tier 3 marine engine and a Tier 3 nonroad engine with a DPF are 5.3 tons per year in the first year after the amendments. In the fifth year after the amendments, the foregone PM reductions would be 27 tons of PM per year, assuming the number of new engines installed each year remains constant. If the baseline is assumed to be Tier 3 marine with DPF, the difference between the Tier 3 marine emissions and the Tier 3 marine with DPF emissions is 6.6 tons of PM per year in the first year and 33 tons of PM in the fifth year. The cost savings in the fifth year after the amendments are estimated to be approximately $8.0 million (2017 dollars). We also show the cost savings using a present value (PV) in adherence to Executive Order 13771. The PV of the cost savings is estimated in 2016 dollars as $322.9 million at a discount rate of 3 percent and $111.2 million at a discount rate of 7 percent. Finally, the annualized cost savings over time can be shown as an equivalent annualized value (EAV), a value calculated consistent with the PV. The EAV of the cost savings is estimated in 2016 dollars as $9.7 million at a discount rate of 3 percent and $7.8 million at a discount rate of 7 percent. All of these PV and EAV estimates are discounted to 2016 and assume an indefinite time period after promulgation for their calculation.

Note that the AEA has indicated that owners and operators of engines in remote communities have been delaying replacement of older engines because of the cost and concerns about having to install new engines with DPFs. Thus, the costs and additional PM emission reductions from engines installed in 2014 and later have not been occurring as expected when the rule was originally issued in 2006. According to the AEA, if these amendments are not finalized, the remote communities will likely continue delaying replacement of older engines, and will not receive the benefits of the reduced PM emissions that will occur if the older engines are replaced by new Tier 3 engines. Replacing an older engine with an engine meeting the Tier 3 marine emission standard results in a significant reduction in PM emissions compared to the Tier 0 engine emissions. For example, for a 238 horsepower engine, PM emissions from a Tier 3 marine engine are reduced by 80 percent from a Tier 0 nonroad engine.

Additional information about these statutes and Executive Orders can be found at https://www.epa.gov/laws-regulations/laws-and-executive-orders.

This action is not a significant regulatory action and was, therefore, not submitted to the Office of Management and Budget (OMB) for review.

This action is considered an Executive Order 13771 deregulatory action. Details on the estimated cost savings of this final rule can be found in the EPA's analysis of the potential costs and benefits associated with this action.

This action does not impose any new information collection burden under the PRA. OMB has previously approved the information collection activities contained in the existing regulations and has assigned OMB control number 2060-0590.

I certify that this action will not have a significant economic impact on a substantial number of small entities under the RFA. In making this determination, the impact of concern is any significant adverse economic impact on small entities. An agency may certify that a rule will not have a significant economic impact on a substantial number of small entities if the rule relieves regulatory burden, has no net burden, or otherwise has a positive economic effect on the small entities subject to the rule. This action reduces the impact of the rule on owners and operators of stationary CI engines located in remote areas of Alaska. We have, therefore, concluded that this action will relieve regulatory burden for all directly regulated small entities.

This action does not contain an unfunded mandate of $100 million or more as described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect small governments. The action imposes no enforceable duty on any state, local, or tribal governments or the private sector.

This action does not have federalism implications. It will not have substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government.

This action does not have tribal implications as specified in Executive Order 13175. While some Native Alaskan tribes and villages could be impacted by this amendment, this rule would reduce the compliance costs for owners and operators of stationary CI engines in remote areas of Alaska. Thus, Executive Order 13175 does not apply to this action.

The EPA interprets Executive Order 13045 as applying only to those regulatory actions that concern environmental health or safety risks that the EPA has reason to believe may disproportionately affect children, per the definition of “covered regulatory action” in section 2-202 of the Executive Order. This action is not subject to Executive Order 13045 because it does not concern an environmental health risk or safety risk.

This action is not subject to Executive Order 13211, because it is not a significant regulatory action under Executive Order 12866.

This rulemaking does not involve technical standards.

While some Native Alaskan tribes and villages could be impacted by this amendment, the EPA believes that this action does not have disproportionately high and adverse human health or environmental effects on minority populations, low-income populations and/or indigenous peoples, as specified in Executive Order 12898 (59 FR 7629, February 16, 1994). The amendments will not have a significant effect on emissions and will likely remove barriers to the installation of new, lower emission engines in remote communities.

This action is subject to the CRA, and the EPA will submit a rule report to each House of the Congress and to the Comptroller General of the United States. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

For the reasons set forth in the preamble, 40 CFR part 60 is amended as follows:

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

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

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

Under section 408(g) of the Federal Food, Drug, and Cosmetic Act (FFDCA), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2019-0186 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing and must be received by the Hearing Clerk on or before September 3, 2019. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2019-0186, by one of the following methods:

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

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

• Hand Delivery: To make special arrangements for hand delivery or delivery of boxed information, please follow the instructions at https://www.epa.gov/dockets/where-send-comments-EPA-dockets.

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

EPA, on its own initiative, in accordance with FFDCA sections 408(e) and 408(l)(6) of, 21 U.S.C. 346a(e) and 346a(1)(6), is establishing time-limited tolerances for residues of indoxacarb, (S)-methyl 7-chloro-2,5-dihydro-2-[[(methoxycarbonyl)[4-(trifluoromethoxy)phenyl]amino]carbonyl]indeno[1,2-e][1,3,4][oxadiazine-4a(3H)-carboxylate, and its R-enantiomer, (R)-methyl 7-chloro-2,5-dihydro-2-[[(methoxycarbonyl)[4-(trifluoromethoxy)phenyl]amino]carbonyl]indeno[1,2-e][1,3,4][oxadiazine-4a(3H)-carboxylate, in/on grass, forage at 10 parts per million (ppm) and in/on grass, hay at 50 ppm. These time-limited tolerances expire on December 31, 2022.

Section 408(l)(6) of FFDCA requires EPA to establish a time-limited tolerance or exemption from the requirement for a tolerance for pesticide chemical residues in food that will result from the use of a pesticide under an emergency exemption granted by EPA under FIFRA section 18. Such tolerances can be established without providing notice or period for public comment. EPA does not intend for its actions on FIFRA section 18 related time-limited tolerances to set binding precedents for the application of FFDCA section 408 and the safety standard to other tolerances and exemptions. Section 408(e) of FFDCA allows EPA to establish a tolerance or an exemption from the requirement of a tolerance on its own initiative, i.e., without having received any petition from an outside party.

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

Section 18 of FIFRA authorizes EPA to exempt any Federal or State agency from any provision of FIFRA, if EPA determines that “emergency conditions exist which require such exemption.” EPA has established regulations governing such emergency exemptions in 40 CFR part 166.

The California Department of Pesticide Regulations (CDPR) notified EPA that an emergency condition exists with respect to control of alfalfa weevils in mixed stands of alfalfa and grasses in the Intermountain Region of California. According to CDPR, an urgent and nonroutine situation arose due to the weevils' developing resistance to the commonly relied-upon pyrethroids, and without a suitable pesticide control, significant losses were expected due to yield and quality decreases. Indoxacarb is registered for use in alfalfa but not for grasses and thus there was a need for an emergency exemption for use in mixed stands of alfalfa and grasses. After having reviewed the submission, EPA determined that an emergency condition exists for this State, and that the criteria for approval of an emergency exemption are met. EPA has authorized a specific exemption under FIFRA section 18 for the use of indoxacarb on mixed stands of alfalfa and grasses for control of alfalfa weevils in California.

As part of its evaluation of the emergency exemption application, EPA assessed the potential risks presented by residues of indoxacarb in or on grass, forage and grass, hay. In doing so, EPA considered the safety standard in FFDCA section 408(b)(2) and decided that the necessary tolerance under FFDCA section 408(l)(6) would be consistent with the safety standard and with FIFRA section 18. Consistent with the need to move quickly on the emergency exemption to address an urgent and non-routine situation and to ensure that the resulting food is safe and lawful, EPA is issuing these tolerances without notice and opportunity for public comment as provided in FFDCA section 408(l)(6). Although these time-limited tolerances expire on December 31, 2022, under FFDCA section 408(l)(5), residues of the pesticide not in excess of the amounts specified in the tolerances remaining in or on grass, forage and grass, hay after that date will not be unlawful, provided the pesticide was applied in a manner that was lawful under FIFRA, and the residues do not exceed the levels that were authorized by these time-limited tolerances at the time of that application. EPA will take action to revoke these time-limited tolerances earlier if any experience with, scientific data on, or other relevant information on this pesticide indicate that the residues are not safe.

Because these time-limited tolerances are being approved under emergency conditions, EPA has not made any decisions about whether indoxacarb meets FIFRA's registration requirements for use on grasses or whether permanent tolerances for this use would be appropriate. Under these circumstances, EPA does not believe that these time-limited tolerance decisions serve as bases for registration of indoxacarb by a State for special local needs under FIFRA section 24(c). Nor do these tolerances by themselves serve as authority for persons in any State other than California to use this pesticide on the applicable crops under FIFRA section 18 absent the issuance of an emergency exemption applicable within that State. For additional information regarding the emergency exemption for indoxacarb, contact the Agency's Registration Division at the address provided under FOR FURTHER INFORMATION CONTACT .

Consistent with the factors specified in FFDCA section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure expected as a result of this emergency exemption use and the time-limited tolerances for combined residues of indoxacarb on grass, forage and grass, hay at 10 ppm and 50 ppm, respectively. There are existing tolerances for residues of indoxacarb in/on meat and milk commodities, and EPA has determined that the existing tolerances for meat and milk commodities will not be exceeded by additional residues in grass forage and hay. EPA's assessment of exposures and risks associated with establishing the time-limited tolerances follows.

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

A summary of the toxicological endpoints for indoxacarb used for human risk assessment is discussed in Unit III of the final rule published in the Federal Register of December 8, 2017 (82 FR 57860) (FRL-9970-39).

1. Dietary exposure from food and feed uses. In evaluating dietary exposure to indoxacarb, EPA considered exposure under the time-limited tolerances established by this action as well as all existing indoxacarb tolerances in 40 CFR 180.564. EPA assessed dietary exposures from indoxacarb in food as follows:

i. Acute exposure. Quantitative acute dietary exposure and risk assessments are performed for a food-use pesticide if a toxicological study has indicated the possibility of an effect of concern occurring as a result of a 1-day or single exposure. Acute effects were identified for indoxacarb. In estimating acute dietary exposure, EPA used food consumption information from the United States Department of Agriculture's (USDA's) 2003-2008 National Health and Nutrition Examination Survey, What We Eat in America (NHANES/WWEIA). As to residue levels in food, EPA used full distributions of residue levels from the results of field trials reflecting maximum use patterns in all commodities and used maximum Percent Crop Treated (PCT) estimates.

ii. Chronic exposure. In conducting the chronic dietary exposure assessment EPA used the food consumption data from the EPA used food consumption information from the USDA's 2003-2008 NHANES/WWEIA. As to residue levels in food, EPA used average residue levels based on the results of field trials reflecting maximum use patterns in all commodities and used average PCT estimates.

iii. Cancer. Based on the data referenced in Unit IV.A., EPA has concluded that indoxacarb does not pose a cancer risk to humans. Therefore, a dietary exposure assessment for assessing cancer risk is unnecessary.

iv. Anticipated residue and percent crop treated (PCT) information. Section 408(b)(2)(E) of FFDCA authorizes EPA to use available data and information on the anticipated residue levels of pesticide residues in food and the actual levels of pesticide residues that have been measured in food. If EPA relies on such information, EPA must require pursuant to FFDCA section 408(f)(1) that data be provided 5 years after the tolerance is established, modified, or left in effect, demonstrating that the levels in food are not above the levels anticipated. For the present action, EPA will issue such data call-ins as are required by FFDCA section 408(b)(2)(E) and authorized under FFDCA section 408(f)(1). Data will be required to be submitted no later than 5 years from the date of issuance of these tolerances.

Section 408(b)(2)(F) of FFDCA states that the Agency may use data on the actual percent of food treated for assessing chronic dietary risk only if:

• Condition a: The data used are reliable and provide a valid basis to show what percentage of the food derived from such crop is likely to contain the pesticide residue.

• Condition b: The exposure estimate does not underestimate exposure for any significant subpopulation group.

• Condition c: Data are available on pesticide use and food consumption in a particular area, and the exposure estimate does not understate exposure for the population in such area.

In addition, the Agency must provide for periodic evaluation of any estimates used. To provide for the periodic evaluation of the estimate of PCT as required by FFDCA section 408(b)(2)(F), EPA may require registrants to submit data on PCT.

The Agency estimated the maximum and average PCT for the acute and chronic dietary assessments for existing uses as follows:

• For acute dietary assessment: Apples: 10%; apricots: 15%; blueberries: 5%; broccoli: 70%; cabbage: 35%; cantaloupe: 10%; cauliflower: 60%; celery: 5%; cherries: 2.5%; cotton: 2.5%; cucumbers: 10%; grapes: 5%; lettuce: 15%; nectarines: 15%; peaches: 10%; peanuts: 10%; pears: 2.5%; peppers: 30%; plums/prunes: 5%; potatoes: 2.5%; soybeans: 2.5%; spinach: 5%; squash: 5%; sweet corn: 10%; and tomatoes: 40%.

• For chronic dietary assessment: Apples: 5%; apricots: 5%; blueberries: 5%; broccoli: 45%; cabbage: 20%; cantaloupe: 5%; cauliflower: 35%; celery: 5%; cherries: 2.5%; cotton: 2.5%; cucumbers: 2.5%; grapes: 2.5%; lettuce: 5%; nectarines: 15%; peaches: 2.5%; peanuts: 5%; pears: 1%; peppers: 15%; plums/prunes: 5%; potatoes: 2.5%; soybeans: 1%; spinach: 2.5%; squash: 2.5%; sweet corn: 2.5%; and tomatoes: 20%.

In most cases, EPA uses available data from United States Department of Agriculture/National Agricultural Statistics Service (USDA/NASS), proprietary market surveys, and the National Pesticide Use Database for the chemical/crop combination for the most recent 6 to 7 years. EPA uses an average PCT for chronic dietary risk analysis. The average PCT figure for each existing use is derived by combining available public and private market survey data for that use, averaging across all observations, and rounding to the nearest 5%, except for those situations in which the average PCT is less than 2.5%. In those cases, estimates of average PCT between 1% and 2.5% are rounded to 2.5% and estimates of average PCT less than 1% are rounded to 1%. EPA uses a maximum PCT for acute dietary risk analysis. The maximum PCT figure is the highest observed maximum value reported within the recent 6 years of available public and private market survey data for the existing use and rounded up to the nearest multiple of 5%, except for those situations in which the maximum PCT is less than 2.5%. In those cases, EPA uses a maximum PCT value of 2.5%.

The Agency believes that the three conditions discussed in Unit IV.B.1.iv. have been met. With respect to Condition a, PCT estimates are derived from Federal and private market survey data, which are reliable and have a valid basis. The Agency is reasonably certain that the percentage of the food treated is not likely to be an underestimation. As to Conditions b and c, regional consumption information and consumption information for significant subpopulations is taken into account through EPA's computer-based model for evaluating the exposure of significant subpopulations including several regional groups. Use of this consumption information in EPA's risk assessment process ensures that EPA's exposure estimate does not understate exposure for any significant subpopulation group and allows the Agency to be reasonably certain that no regional population is exposed to residue levels higher than those estimated by the Agency. Other than the data available through national food consumption surveys, EPA does not have available reliable information on the regional consumption of food to which indoxacarb may be applied in a particular area.

2. Dietary exposure from drinking water. The Agency used screening-level water exposure models in the dietary exposure analysis and risk assessment for indoxacarb in drinking water. These simulation models take into account data on the physical, chemical, and fate/transport characteristics of indoxacarb. Further information regarding EPA drinking water models used in pesticide exposure assessment can be found at https://www.epa.gov/pesticide-science-and-assessing-pesticide-risks/about-water-exposure-models-used-pesticide.

Based on the Surface Water Concentration Calculator (SWCC) model and the Pesticide Root Zone Model Ground Water (PRZM GW), the estimated drinking water concentrations (EDWCs) of indoxacarb for acute exposures are estimated to be 39 parts per billion (ppb) for surface water and 131 ppb for ground water; for chronic exposures the EDWCs are 11 ppb for surface water and 123 ppb for ground water.

Modeled estimates of drinking water concentrations were directly entered into the dietary exposure model. For acute dietary risk assessment, a time series distribution of ground water modeled residues was used to assess the contribution to drinking water. For chronic dietary risk assessment, a single point water concentration value of 123 ppb was used to assess the contribution to drinking water.

3. From non-dietary exposure. The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure ( e.g., for lawn and garden pest control, indoor pest control, termiticides, and flea and tick control on pets).

Indoxacarb is currently registered for the following uses that could result in residential exposures: Pet spot-on uses, spot and crack and crevice applications indoors, outdoor broadcast ( i.e., turf), perimeter and foundations, spot outdoors ( i.e., direct mound applications for fire ants), and crack and crevice outdoors. Based on these use scenarios, EPA assessed residential exposure using the following assumptions:

• Spot and crack and crevice exposures were not quantified due to formulation types that minimize the potential for handler and postapplication exposures ( i.e., gels or bait stations). Risks from spot and crack and crevice were not quantified because exposures from these formulation types are expected to be negligible.

• Residential handler exposure: There is a potential for dermal and inhalation exposure. Residential handler inhalation exposure is considered negligible for applying ready-to-use pet spot-ons. Residential handler dermal exposures are expected for ready-to-use pet spot-ons, however dermal exposures were not quantified due to the lack of a dermal endpoint. Residential handler inhalation and dermal exposures are considered negligible for applying ready-to-use materials ( i.e., baits or stations).

• Residential post-application dermal and incidental oral exposure: Postapplication assessments were not conducted for ant mound uses, because these are considered perimeter/spot uses; residential exposure is expected to be negligible. Spot and crack and crevice exposures were not quantified for gels or bait stations; exposure is considered negligible. A golfer assessment was not conducted, due to the lack of a dermal endpoint. Postapplication inhalation exposure is generally not assessed following application to pets and turf. The combination of low vapor pressure (1.9 × 10 −10 mm Hg at 25 °C for indoxacarb) of active ingredients typically used in pet and turf pesticide products, and the small amounts of pesticide applied to pets is expected to result in only negligible inhalation exposure. Ingestion of granules is considered an episodic event and not a routine behavior. Because the Agency does not expect this to occur on a regular basis, concern for human health is related to acute poisoning rather than short-term residue exposure. For these reasons, the episodic ingestion scenario is not included in the aggregate assessment. The only route of residential exposure for inclusion in the adult aggregate assessment is inhalation. However, for adults it would be inappropriate to aggregate inhalation exposures with background dietary exposures because the toxicity endpoints for the inhalation and short-term oral routes are different. Therefore, the only residential exposures that were combined are for children 1 to <2 years old in the short-term aggregate assessment that reflects hand-to-mouth exposures from post-application exposure to spot treatment on carpets, and children 1 to <2 years old in the intermediate- and long-term aggregate assessment that reflects exposures from treated pets.

Further information regarding EPA standard assumptions and generic inputs for residential exposures may be found at: https://www.epa.gov/pesticide-science-and-assessing-pesticide-risks/standard-operating-procedures-residential-pesticide.

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

EPA has not found indoxacarb to share a common mechanism of toxicity with any other substances, and indoxacarb does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that indoxacarb does not have a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see EPA's website at https://www.epa.gov/pesticide-science-and-assessing-pesticide-risks/cumulative-assessment-risk-pesticides.

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

2. Prenatal and postnatal sensitivity. There was no evidence of reproductive effects in rats. There was no evidence of increased susceptibility in developing fetuses or in the offspring following prenatal and/or postnatal exposure to indoxacarb in rats or rabbits. There was no evidence of increased susceptibility in the young in the developmental neurotoxicity study in rats.

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

i. The toxicity database for indoxacarb is complete.

ii. The acute neurotoxicity, subchronic toxicity, and developmental neurotoxicity studies for indoxacarb are available and all endpoints used in the risk assessment are protective of neurotoxic effects.

iii. There is no evidence that indoxacarb results in increased susceptibility in in utero rats or rabbits in the prenatal developmental studies or in young rats in the 2-generation reproduction study.

iv. There are no residual uncertainties identified in the exposure databases.

The Agency estimated maximum and average PCT values for the acute and chronic dietary assessments, as shown in unit IV.B.1.iv. Food residues were taken from the results of supervised field trial studies reflecting maximum use patterns. Drinking water residues were included in the dietary assessments as follows: A point estimate of 123 ppb was used for the chronic assessment and the time series distribution of ground water modeled residues was used in the acute assessment as a residue distribution file in the Monte Carlo analysis. For food commodities, Residue Distribution Files (RDFs) were constructed for the probabilistic acute dietary assessment as appropriate, and average residues were used for blended commodities. For the chronic dietary assessment, either average residue levels from field trial studies were used or for crops where no residues were found, a value of 1/2 the limit of quantitation was assumed. EPA used similarly conservative assumptions to assess post-application exposure of children as well as incidental oral exposure of toddlers. These assessments will not underestimate the exposure and risks posed by indoxacarb.

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

1. Acute risk. Using the exposure assumptions discussed in this unit for acute exposure, the acute dietary exposure from food and water to indoxacarb will occupy 56% of the aPAD for children ages 1-2, the population group receiving the greatest exposure.

2. Chronic risk. Using the exposure assumptions described in this unit for chronic exposure, EPA has concluded that chronic exposure to indoxacarb from food and water will utilize 35% of the cPAD for all infants <1 year old, the population group receiving the greatest exposure. EPA has concluded the combined long-term food, water, and residential exposures result in an aggregate MOE of 260 (food, water, and residential) for children aged 1-2. Because EPA's level of concern for indoxacarb is an MOE of 100 or below, this MOE is not of concern. For adults, residential inhalation exposures cannot be aggregated because they are based on different effects than for oral exposures. Therefore, long-term aggregate risk for adults is equivalent to the chronic dietary risk noted in this unit.

3. Short-term risk. Short-term aggregate exposure takes into account short-term residential exposure plus chronic exposure to food and water (considered to be a background exposure level). Indoxacarb is currently registered for uses that could result in short-term residential exposure, and the Agency has determined that it is appropriate to aggregate chronic exposure to children aged 1-2 years through food and water with short-term residential exposures to indoxacarb. For adults, residential inhalation exposures cannot be aggregated with chronic dietary because they are based on different effects than for oral exposures. Because chronic dietary exposure has already been assessed under the appropriately protective cPAD (which is at least as protective as the POD used to assess short-term risk) and inhalation risk has been assessed for adults, no further assessment of short-term risk is necessary for adults, and EPA relies on the findings from the chronic dietary risk assessment and inhalation assessment, as noted in unit IV.D.2 and IV.D.3, for evaluating short-term risk to adults for indoxacarb.

Using the exposure assumptions described in this unit for short-term exposures, EPA has concluded the combined short-term food, water, and residential exposures result in aggregate MOEs of 120 (food, water, and residential) for children aged 1-2. Because EPA's level of concern for indoxacarb is an MOE of 100 or below, this MOE is not of concern.

4. Intermediate-term risk. Intermediate-term aggregate exposure takes into account intermediate-term residential exposure plus chronic exposure to food and water (considered to be a background exposure level). Indoxacarb is currently registered for uses that could result in intermediate-term residential exposure, and the Agency has determined that it is appropriate to aggregate chronic exposure to children ages 1-2 years through food and water with intermediate-term residential exposures to indoxacarb. For adults, residential inhalation exposures cannot be aggregated with chronic dietary because they are based on different effects than for oral exposures. Because chronic dietary exposure has already been assessed under the appropriately protective cPAD (which is at least as protective as the POD used to assess intermediate-term risk), no further assessment of intermediate-term risk is necessary for adults, and EPA relies on the findings from the chronic dietary risk assessment, as noted in unit IV.D.2, for evaluating intermediate-term risk to adults for indoxacarb.

Using the exposure assumptions described in this unit for intermediate-term exposures, EPA has concluded that the combined intermediate-term food, water, and residential exposures for children aged 1-2 years result in an aggregate MOE of 260. Because EPA's level of concern for indoxacarb is an MOE of 100 or below, this MOE is not of concern.

5. Aggregate cancer risk for U.S. population. Based on the lack of evidence of carcinogenicity in two adequate rodent carcinogenicity studies, indoxacarb is not expected to pose a cancer risk to humans.

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

For the enforcement of tolerances established on crops, two High Performance Liquid Chromatograph/Ultraviolet Detection (HPLC/UV) methods, DuPont protocols AMR 2712-93 and DuPont-11978, are available for use. The limits of quantitation (LOQs) for these methods range from 0.01 to 0.05 ppm for a variety of plant commodities. A third procedure, Gas Chromatograph/Mass-Selective Detection (GC/MSD), DuPont method AMR 3493-95 Supplement No. 4, is also available for the confirmation of residues in plants.

The methods may be requested from: Chief, Analytical Chemistry Branch, Environmental Science Center, 701 Mapes Rd., Ft. Meade, MD 20755-5350; telephone number: (410) 305-2905; email address: residuemethods@epa.gov.

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

The Codex has not established MRLs for indoxacarb in/on grass forage or grass hay.

Therefore, time-limited tolerances are established for residues of indoxacarb, (S)-methyl 7-chloro-2,5-dihydro-2-[[(methoxycarbonyl)[4-(trifluoromethoxy)phenyl]amino]carbonyl]indeno[1,2-e][1,3,4][oxadiazine-4a(3H)-carboxylate, and its R-enantiomer, (R)-methyl 7-chloro-2,5-dihydro-2-[[(methoxycarbonyl)[4-(trifluoromethoxy)phenyl]amino]carbonyl]indeno[1,2-e][1,3,4][oxadiazine-4a(3H)-carboxylate, in or on grass, forage at 10 ppm and grass, hay at 50 ppm. These tolerances expire on 12/31/2022.

This action establishes tolerances under FFDCA sections 408(e) and 408(l)(6). The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled “Regulatory Planning and Review” (58 FR 51735, October 4, 1993). Because this action has been exempted from review under Executive Order 12866, this action is not subject to Executive Order 13211, entitled “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) or Executive Order 13045, entitled “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997). This action does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq., nor does it require any special considerations under Executive Order 12898, entitled “Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations” (59 FR 7629, February 16, 1994).

Since tolerances and exemptions that are established in accordance with FFDCA sections 408(e) and 408(l)(6), such as the tolerances in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. ) do not apply.

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

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

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

Therefore, 40 CFR chapter I is amended as follows:

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

Entities potentially affected by this action include:

The EPA has established a docket for this action under Docket ID No. EPA-HQ-OW-2016-0598. All documents in the docket are listed on the https://www.regulations.gov website. Although listed in the index, some information is not publicly available, e.g., CBI or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the internet and will be publicly available only in hard copy form. Publicly available docket materials are available electronically through https://www.regulations.gov.

The EPA promulgated the UOG rule on June 28, 2016. 81 FR 41845. The UOG rule regulates wastewater pollutants from unconventional oil and gas extraction activities under Subpart C (Onshore Subcategory) of the oil and gas extraction effluent guidelines. The UOG rule is a national rule that prohibits onshore unconventional oil and gas extraction operations from discharging pollutants in wastewater to publicly owned treatment works (POTWs), in other words, a “zero discharge” requirement. The UOG rule defines the term “unconventional oil and gas operations” to include operations involving “crude oil and natural gas produced by a well drilled into a shale and/or tight formation (including, but not limited to, shale gas, shale oil, tight gas, and tight oil).” See 40 CFR 435.33(a)(2)(i). In promulgating the rule, the EPA explained that UOG wastewaters are not typical of POTW influent wastewater, and as a result some UOG extraction wastewater pollutants: Can be discharged untreated from a POTW to the receiving stream ( i.e., the POTW is not designed to treat the pollutant); can cause the disruption of the POTW treatment operations ( e.g., biological treatment is inhibited); can accumulate in biosolids, limiting their use; and can cause the formation of harmful disinfection by-products.

The EPA's record at the time of promulgation indicated that all UOG extraction facilities were meeting the zero discharge requirement, and the EPA received no comments at proposal indicating otherwise. However, after the UOG rule was promulgated, several interested parties notified the EPA that a number of oil and gas operations in Pennsylvania covered by the rule were in fact discharging wastewater to POTWs. These parties stated that their operations are “conventional” under Pennsylvania definitions, although they appear to meet the definition of “unconventional” in the UOG rule.

Based on this post-promulgation information, the EPA extended the compliance date for existing sources that were lawfully discharging to POTWs on or between April 7, 2015, and June 28, 2016, to three years from the effective date of the rule—to August 29, 2019, (compliance date postponement rule). See 81 FR 88126-88127. That rule did not change the compliance date for all other facilities subject to the final UOG rule.

Pennsylvania Grade Crude Oil Coalition (PGCC) also filed a petition for review of the rule in the U.S. Court of Appeals for the Third Circuit. PGCC indicated that the EPA incorrectly found that there were no existing discharges to POTWs by facilities that meet the definition of “unconventional” in the UOG rule. In response, the EPA filed a motion (unopposed by PGCC) for voluntary remand without vacatur which was granted by the Court in October, 2017. Pennsylvania Crude Oil Coalition v. EPA, No. 16-4064 (3rd Cir., Aug. 31, 2017). In the motion, the EPA discussed the post-promulgation information referenced above, acknowledging that this new information was inconsistent with the record for the rule. The EPA explained that the Agency requested the remand to consider any additional evidence relevant to the UOG rule, develop the record, and take any follow-up action as appropriate. This notice provides the EPA's decision in accordance with this remand.

As explained in this notice, the EPA recently gathered new data and information and performed supporting analyses to update the 2016 record for the final UOG rule. The scope of the data collection and analyses discussed in this notice pertains only to those oil and gas extraction facilities in the United States that the EPA has identified to be discharging UOG wastewater to POTWs at the time it finalized the UOG rule—in other words, those facilities defined as conventional by Pennsylvania that meet the definition of unconventional in the UOG rule and are thus likely subject to the EPA's 2016 UOG pretreatment standard rule.

EPA staff also met with producers in Pennsylvania to further understand their concerns. As a result of this interaction, the EPA learned that the scope of the Agency's 2016 UOG pretreatment standard rule may not have been clear to certain producers. To clarify the scope of the UOG rule, the UOG rule is not applicable to activities regulated under the Stripper Subcategory (40 CFR 435 Subpart F). The UOG rule applies to onshore unconventional oil and gas extraction facilities regulated under Subpart C. Subpart C excludes facilities regulated under Subpart F.

A detailed description of the data sources, methodology, and associated analyses can be found at: https://www.epa.gov/eg/unconventional-oil-and-gas-extraction-effluent-guidelines. This section summarizes that information and provides results.

First, the EPA conducted additional analyses to determine whether wells discharging to POTWs in Pennsylvania would meet the definition of “unconventional” and thus be subject to the EPA's 2016 UOG rule. Oil and gas operators in the Commonwealth of Pennsylvania must report to the Pennsylvania Department of Environmental Protection information on their wells, such as wastewater management and formation type. During development of the 2016 UOG rule, the EPA used this Commonwealth-compiled data to support the Agency's finding that there were no UOG extraction facilities discharging wastewater to POTWs. However, based on the information submitted to the EPA after promulgation of the rule, the Agency came to understand that some facilities that would meet the definition of unconventional in the 2016 UOG rule were categorized as conventional in the Pennsylvania data that the EPA relied on, based on the Commonwealth's narrower definition of unconventional. Accordingly, the EPA has re-evaluated the available data. In particular, the EPA used information that the oil and gas extraction facilities reported to Pennsylvania for 2016 and well formation information from multiple sources to identify those oil and gas extraction facilities that discharged any wastewater to POTWs and that are defined as conventional under Pennsylvania's definition, but are defined as unconventional under the UOG rule's definition. 1 As described above, oil and gas extraction activities regulated under the Stripper Subcategory (Subpart F) are not included in this rule, and therefore were not included in the scope of analyses discussed in this notice. In the analysis of the data, the EPA excluded any well that had less than a ratio of 15,000 cubic feet of gas per 1 barrel of oil and had less than an average of 10 barrels per day of oil over the year's reported production and number of producing days. Based on the 2016 Commonwealth data, the EPA determined that out of 879 oil and gas extraction entities reporting to Pennsylvania in 2016 (and over 6,000 entities nationwide), 22 entities discharged at least some portion of their wastewater to a POTW from UOG operations as defined by the 2016 UOG rule. Based on the 2016 data, the EPA concludes that this subset of entities may need to make changes to comply with the 2016 UOG rule (and would incur any associated costs).

For each well that generated wastewater that was sent to a POTW from these 22 entities, the EPA determined the nearest wastewater management alternative (centralized waste treatment (CWT) facility or Class II underground injection control (UIC) well). The EPA found that wastewater management alternatives were available to all of these entities as many of them reported using another wastewater management alternative in addition to a POTW in 2016. To estimate the potential incremental costs of this rule to these entities (which represent the only entities in the U.S. that may incur costs associated with the nationally applicable rule), the EPA calculated any incremental wastewater management costs for these entities to send their wastewater to the nearest wastewater management alternative as well as any associated incremental transportation costs. The EPA added incremental wastewater management and transportation costs to determine the total incremental costs to these entities to comply with the 2016 UOG rule.

The EPA also evaluated incremental non-water quality environmental impacts associated with alternative wastewater management approaches. These include changes in air emissions, solid waste generation, and energy consumption. The incremental change depends on the alternative wastewater management approach. For example, sludge generation would likely decrease if a UOG facility sends its wastewater to a UIC well and would likely increase if it sends its wastewater to a CWT facility. Even if each UOG operator that currently sends its wastewater to a POTW elected to use a wastewater management approach that incrementally increased air emissions, sludge generation or energy usage, these changes would be small relative to U.S. totals for this industry as a whole.

The EPA then conducted a discounted cash flow analysis (modeled future revenue and operation costs) over 10 years to estimate the potential financial impacts on these entities. Based on this analysis, the EPA determined that seven of the 22 entities would have negative profits irrespective of the UOG rule's incremental costs. For the remaining entities, when adding in the incremental costs of the rule, the EPA's analysis shows that none of the 15 entities would be at risk of closure as a result of complying with the UOG rule.

In light of the model predictions based on 2016 reported data that some of these entities would have negative profits irrespective of the UOG rule's incremental costs, the EPA also reviewed oil and gas production data for all 22 entities as reported to Pennsylvania in 2017. All 22 entities continued to report oil and gas production to Pennsylvania, demonstrating that they remain in business. Therefore, the EPA is reporting cost information as a range with the lower value representing information for the 15 modeled profitable entities and the upper value representing information for all 22 entities. The EPA's analysis shows that for 2016, the median incremental costs would be $131 to $279 per entity and the total costs of the UOG rule for 2016 would be approximately $33,000 to $65,000 (in 2016$).

At the time the EPA promulgated the 2016 UOG rule, it established a zero discharge of pollutant pretreatment standard for UOG extraction facilities based on alternative wastewater management approaches. Consistent with the factors identified in the Clean Water Act and described in the preamble to the 2016 rule, the EPA found these alternatives to be available, have acceptable non-water quality environmental impacts, and be economically achievable, based in part on its findings that no existing UOG facilities were discharging pollutants to POTWs at the time of the 2016 rule. The EPA concluded that such standards would prevent some UOG extraction wastewater constituents from largely “passing through” the POTW untreated, and then discharged from the POTW to the receiving stream.

The EPA has supplemented that rulemaking record to account for the UOG facilities in Pennsylvania that were in fact discharging wastewater to POTWs at the time of the rulemaking. Based on the EPA's analysis of the new information described above, the EPA concludes that the zero discharge of pollutants standard is technologically available, economically achievable, and has acceptable non-water quality environmental impacts. Based on this information, the EPA will not revise the 2016 UOG rule.

Background

Currently, the states of Washington, Oregon, and California require the reporting of trawl fishery data in the trawl logbook form. The states use a single, identical logbook form the Pacific Fishery Management Council (Council) developed to collect information necessary to effectively manage the groundfish fishery on a coastwide basis. While each state has its own requirement for vessels to complete the trawl logbook form, each state transmits the logbooks or logbook data to the Pacific States Marine Fisheries Commission (PSMFC). PSMFC compiles the data from the logbooks into the PacFIN Coastwide Trawl Logbook Database, and distributes the data to users such as the Council, NMFS, and the Groundfish Management Team (GMT). In addition to managing the logbook data, the PSMFC prints the logbook forms and distributes them to Washington and Oregon so that the states can distribute them to vessels, and distributes them directly to the vessels in California.

Washington, Oregon, and California have long required trawl vessels to submit information on their fishing activity. Since the late 1980's, all three states have collected similar data in order to facilitate coastwide monitoring of the groundfish trawl fishery. As a result of this longstanding requirement for the collection of trawl effort data, NMFS and the Council have an extensive dataset on how trawling activity has changed over time. This data has been especially useful in actions to assess the effects of area management, such as the rockfish conservation areas, and to otherwise supplement stock assessments, especially for stocks that are managed by area.

On December 12, 2018, the California Fish and Wildlife Commission (Commission) voted to repeal its requirement for commercial trawl vessels to complete and submit the logbook form, effective July 1, 2019. There is no existing Federal requirement for vessels to complete and submit the trawl logbook form. Instead, the Federal requirement is for vessels to follow their respective state logbook requirements (50 CFR 660.13(b)). Therefore, without this rule, trawl vessels off of California would no longer be required to complete and submit the trawl logbook form.

The trawl logbook form developed by the Council collects fisherman-reported haul-level effort data including tow time, tow location, depth of catch, net type, target strategy, and estimated pounds of fish retained per tow. Most data is collected while the vessel is fishing, with only buyer information collected upon landing. Each trawl log represents a single fishing trip. The logbook forms are due monthly to each state, and the data is matched to a landing receipt (fish ticket) summary data submitted by seafood processors. This matching step acts as a data corroboration process for landings, and allows the PSMFC to identify and correct any errors in the data. NMFS, the Council, the GMT, the Northwest Fishery Science Center, and the PSMFC use the data obtained from the logbooks in analyses of catch locations and bycatch hotspots, spot verification of fish tickets, analyses on gear usage by area, stock assessments, and a variety of other applications. Additionally, Federal groundfish regulations require vessels to make the logbooks available to fishery observers under the West Coast Groundfish Observer Program (WCGOP). The observers collect biological samples and pair these samples with logbook data describing vessel position, target, depth, and retained catch. These data are not always accessible from other sources such as equipment on the ship. Finally, the logbook data are also used by the NMFS Office of Law Enforcement and the U.S. Coast Guard in investigations.

This rule creates a Federal requirement for trawl catcher vessels operating under a limited entry trawl permit operating in the Shorebased IFQ Program to complete and submit the trawl logbook form in the absence of a similar state requirement in the state in which the vessel operates. This requirement applies to all trawl catcher vessels off the West Coast, but because Washington and Oregon have a state requirement for trawl logbook forms, vessels operating in those states will only be subject to their respective state's rules. Should Washington or Oregon choose to rescind their logbook requirement in the future, vessels operating in those states would then be subject to this regulation. However, Washington and Oregon continue to have state requirements for the logbook form and have not indicated any intent to change the requirement, therefore this rule will only affect trawl vessels operating off of California at this time.

In 2018, there were 21 trawl vessels operating in California, 8 of which were also participating under the electronic monitoring exempted fishing permit (EFP), which separately requires completion and submission of the trawl logbook form. However, vessels may move in and out of the EFP, therefore 21 vessels is the maximum pool of affected vessels. Overall, there were approximately 97 trawl vessels operating in the fishery coastwide in 2018, therefore this action will affect about 22 percent off the trawl fleet off of the West Coast.

This rule is structured to minimize the impact on trawl vessels off of California by maintaining the identical logbook form that vessels have been using for the past several years and by maintaining the same reporting timeframe (logbooks due monthly by the 10th of the month after which fishing was completed). The logbook forms for trawl vessels operating off California will continue to be distributed by the PSMFC, as they currently are. The only difference that California fishermen will notice is that the address where the logbooks must be submitted will change. Under this rule, vessels will be required to send logbook forms to the PSFMC, on behalf of NMFS, at: Pacific States Marine Fisheries Commission, 619 2nd Street, Eureka, CA 95501. NMFS and the PSMFC plan to provide pre-addressed and stamped envelopes with the logbook forms for return of the logbooks, as California did, for the first year of the new requirement, with further costs to be evaluated at a later date.

This rule will continue a longstanding requirement for the trawl fleet, and maintain the way in which the information is collected and how often it must be submitted. Therefore, NMFS expects that there will be minimal public disruption by this rule.

At its June 2019 meeting, the Council requested that NMFS promulgate regulations to implement a Federal requirement to maintain the existing logbook information collection program pursuant to Section 402(a)(1) of the Magnuson-Stevens Act. NMFS determined that the need for a Federal requirement to ensure the continuation of this information collection program is justified, and therefore is publishing this rule.

This rule adds paragraphs § 660.12(b)(3) and § 660.13(a)(1) and (2) to require trawl vessels operating under a limited entry trawl permit to complete and submit the trawl logbook form in the absence of a similar state requirement in the state in which the vessel operates.

The Assistant Administrator for Fisheries, NOAA, has determined that this rule is consistent with the National Standards, other provisions of the Magnuson-Stevens Act, and other applicable laws.

Due to the abbreviated timeline within which the repeal of California's regulation will be effective (July 1, 2019), and the negative effects of a logbook coverage gap for all entities that depend on the information obtained through the logbook, pursuant to 5 U.S.C. 553(b)(B), there is good cause to waive prior notice and an opportunity for public comment on this action, as notice and comment would be impracticable and contrary to the public interest. If the implementation of this requirement were to be delayed, there would be gaps in the collection of trawl effort data for vessels off of California. This gap would have a significant detrimental impact on the dataset and its utility for management purposes as a continuous time series for stock assessments, as fine scale data on protected species catch, for data validation of fish tickets, and for enforcement purposes. Of specific concern, the Council is increasingly moving towards using targeted bycatch hotspot closures as a means to manage take of protected or prohibited species. Without catch data by area collected in the trawl logbook form, this type of targeted closures are difficult to enact.

Additionally, observers in the West Coast Groundfish Observer Program regularly use the information in the logbook during a trip to apportion biological data by area, and this biological data is used in stock assessments and other catch and bycatch reporting. If NMFS went through notice and comment rulemaking, the resulting three-month delay would mean a significant portion of the 2019 trawl fishing season would lack complete data from trawl activities off of California. There would be no way to corroborate landings reports during this time, or for observers to be able to match biological samples and catch or discard records to a specific area, or for NMFS Office of Law Enforcement to have information to investigate fisheries violations. For these reasons, NMFS finds good cause to waive prior notice and an opportunity for public comment on this action. For the same reasons, NMFS also finds good cause, pursuant to 5 U.S.C. 553(d)(3), to waive the 30-day delay in the date of effectiveness, so that this interim final rule may become effective upon publication in the Federal Register . Because this requirement will mirror the requirement these vessels have been subject to under California law since the 1980s, NMFS does not expect that this interim final rule will cause any concern or disruption to participants in the fishery.

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

There are no relevant Federal rules that may duplicate, overlap, or conflict with this action.

Although we are waiving prior notice and opportunity for public comment, we are requesting comments on this interim final rule until August 5, 2019. Please see ADDRESSES for more information on the ways to submit comments.

Because prior notice and opportunity for public comment are not required for this rule by 5 U.S.C. 553, or any other law, the analytical requirements of the Regulatory Flexibility Act, 5 U.S.C. 601 et seq., are inapplicable.

This action contains a new information collection requirement subject to the Paperwork Reduction Act (PRA), which has been submitted for approval by the Office of Management and Budget (OMB) under OMB Control Number 0648-XXXX.

Send comments regarding these burden estimates or any other aspect of this data collection, including suggestions for reducing the burden, to NMFS (see ADDRESSES ), and by email to OIRA_Submission@omb.eop.gov, or fax to 202-395-5806.

Notwithstanding any other provision of the law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB control number. All currently approved NOAA collections of information may be viewed at: http://www.cio.noaa.gov/services_programs/prasubs.html.

For the reasons set out in the preamble, 50 CFR part 660 is amended as follows: