On March 4, 2019, we published in the Federal Register (84 FR 7304-7306, Docket No. APHIS-2018-0041) a proposal  1 to amend the domestic quarantine regulations for Globodera pallida (pale cyst nematode, or PCN) by adding procedures that allow persons to review and comment on the protocols for regulating and deregulating quarantined and associated areas. We took this action in response to a court order  2 requiring the Animal and Plant Health Inspection Service (APHIS) to solicit public input into the development of the protocols used for deregulating fields for PCN.

We solicited comments concerning our proposal for 60 days ending May 3, 2019. We reopened the comment period for 30 days ending July 26, 2019, in response to commenters who experienced technical difficulties with accessing the protocols online.

During the comment period, we made available for comment six documents: The Infested Field Confirmatory Policy, the Regulated Field Survey and Laboratory Result Definitions, the Infested Field Deregulation Protocol (if remaining in host crop production), the Associated Field Deregulation Protocol (if remaining in host crop production), the Deregulation Protocol for Agricultural Land No Longer in Host Crop Production, and the Analysis in Support of Certification that the Rule will not have a Significant Economic Impact on a Substantial Number of Small Entities.

We received a total of 19 comments, 2 of which were submitted twice. One person commented that we did not adequately explain the science and sources for our confirmatory and deregulatory field protocols contained in the applicable documents. Out of an abundance of caution and transparency, and in deference to the court which directed us to provide “requisite public notice and commenting on the Deregulation Protocols,” APHIS is providing the public with an additional opportunity to comment on the science supporting the protocols, including the sources of the methods informing their content. Accordingly, we are including more information about the protocols in this document and are reopening the comment period for 30 days.

APHIS' prompt response to finding PCN in Idaho, which resulted in the drafting and publication of the interim rule in 2007, 3 drew extensively upon the U.S. Department of Agriculture (USDA) Emergency Programs Manual (EPM) (February 2002). 4 The EPM lays out in general form the procedures necessary for addressing plant pest emergencies, including development of an interim rule that establishes survey activities, quarantines, movement restrictions, and other pest measures intended to mitigate or eradicate the pest. APHIS has implemented similar plant pest responses throughout the United States in other programs to address golden nematode, spotted lanternfly, potato wart, gypsy moth, and fruit flies. Similar types of early detection and rapid response efforts are employed by other Federal, State, and international plant protection organizations.

Based on the initial regulations for controlling PCN that we finalized through rulemaking, we subsequently developed protocols for regulating and deregulating PCN-infested and associated fields. 5 APHIS has harmonized its regulations and enforcement efforts with those of the Idaho State Department of Agriculture and the Canadian Food Inspection Agency. The protocol mitigations work collectively as a systems approach and have significantly reduced the rate of PCN spread by regulating infested and associated fields and establishing sanitation requirements for equipment and vehicles leaving infested and associated fields. In the absence of such regulatory measures, we note that statistical analysis of human-assisted spread of PCN estimates a mean spread rate of 3.29 miles/year. 6 This suggests that in the 14 years since PCN was first detected in Idaho, the pest could have spread more than 46 miles from the first infested field identified. With regulatory controls in place, PCN is limited to an area within an 8.5-mile radius, only 11.5 miles in straight line distance.

Below, we list the procedures used in the protocols and explain the scientific rationale and background we relied upon as grounds for including them. As noted above, many, if not most, of these procedures have been employed by USDA and State pest programs for decades across the United States, in various forms and for many different plant pests and crops, including nematodes on potatoes. Internationally, Australia and Japan, which also do not have widespread PCN infestations, have also relied on these and similar best practices to help them respond to PCN detections in their respective countries. 7

Different types of farming equipment can spread Globodera cysts, 8 with potato diggers representing the greatest potential risk. The risk is high because of the large amount of soil that adheres to the digger and because PCN population densities are highest at harvest time following production of a susceptible cultivar. Additionally, the new cysts present at harvest contain a large number of viable eggs that provide a greater chance of successful population establishment. 9 Consequently, every precaution should be taken to prevent the spread of potato cyst nematodes. Nematologists advise those who work in the fields to clean equipment of soil before entering non-infested sites. 10

Based on these established best practices, the PCN program protocols include requirements for pressure washing or using steam to clean all farm equipment, vehicles, or other conveyances that have been in a PCN infested or associated field. These procedures ensure that nematodes are not carried into new fields via soil or equipment. Washing and steam sterilization of equipment has been a phytosanitary standard for nematode and other plant pest control for decades, and the techniques required in the PCN deregulation protocols are similar to plant pest sanitation protocols used throughout the United States and the world. More specifically, the PCN sanitation practices are modeled in part after those employed by the USDA Golden Nematode program for controlling the spread of that pest in New York State. A 2006 version of the USDA Golden Nematode Manual requires that all soil be removed by cleaning farm equipment, mechanized soil moving equipment, farm tools, used containers, and other similar articles using pressure washing and steam treatment. 11

Soil sampling rates used by the PCN program for associated and infested fields are supported by a model that combines the medium scale distribution of cysts and the small scale distribution of cysts within square meters. The medium scale distribution provides the expected population densities at each position within the focus and refers to the size and shape of a focus resulting from farming practices. The small scale distribution represents the multiplication of Globodera on the roots of evenly spaced potato plants.

A computer program, SAMPLE, analyzes soil sampling methods. 12 The parameters of the model include gradient length and width, which represent the medium scale distribution and the aggregation factor of the negative binomial distribution (small scale distribution). Terms of the soil sampling method are also factored into the program. The terms are maximum grid cell size, sampling points per hectare (ha), core size cubic centimeters (cc), soil sample size (cc) per ha, and bulk sample size (gram). In this program, the selected average detection probability is set at 90 percent. The following sampling rates were calculated to detect extremely small infestations at three critical phases of the program: Deregulation of associated fields, monitoring eradication progress on infested fields, and deregulation of infested fields (in-field bioassay). The Canadian and United States Guidelines on Surveillance and Phytosanitary Actions for the potato cyst nematodes Globodera rostochiensis and Globodera pallida recommend a minimum sample size of 20,000 cc per ha (approximately 8,000 cc per acre) taken either manually or mechanically. When a similar method was analyzed with the SAMPLE program using 15,000 cc/ha (approximately 6,000 cc per acre) with a bulk sample size of 22.5 kilogram (kg), it had a detection probability of 99 percent with a central population density (CPD) of 50 cysts per kg of soil. For small infestation foci where the CPD is 5 cysts per kg of soil, the method has a detection probability of only 22 percent.

The delimiting rate for associated fields is 8,000 cubic centimeters (cc)/acre (ac), approximately 20 pounds (lbs)/ac. According to the SAMPLE model, for an infestation with a CPD of 50 cysts/kg in a field, the model shows a detection probability of 98.55 percent at the delimiting survey rate. Associated fields are required to undergo two surveys at the delimiting rate, each following a host crop. At a CPD of 50 cysts/kg, the second sampling detection should remain high. To calculate the cumulative detection probabilities with repetitive sampling, the product of both non-detection probabilities are combined. The probability of no detection each year is 1 − 0.9855 = 0.0145. If this happens twice, the combined probability of no detection equals 0.0145 2 = 0.00021025. Detection after two crops surveyed by this method is 1 − 0.00021025 = 0.9998, or 99.98 percent. For small infestations of 5 cysts/kg (approximately 2 cysts per pound) of soil, however, repetitive sampling is even more important because the detection probability starts at 22 percent but increases with each host crop.

The infested field monitoring survey rate is 80,000 cc/ac, approximately 200 lbs/ac. Because of the small infestation foci in Idaho, a declining cyst population from the absence of host crops, and the application of eradication treatments, intensive sampling increases the chance of detection and the accuracy of population estimation. As a result, the intense monitoring survey rate of 80,000 cc/ac for infested fields is scientifically supported.

The infested field in-field bioassay rate is 20,000 cc/ac, approximately 50 lbs/ac. This rate is scientifically justified by the model where a small infestation with a CPD of 5 cysts/kg has a detection probability of 22 percent. As described for the delimiting survey method, the model shows that when the CPD increases, the detection probability also increases. Because the in-field bioassay reintroduces host crops and requires soil surveys following each of three host crops, the incipient population increases; therefore, detection probability also significantly increases.

Soil samples are collected at the field surface; however, potato harvest machinery and annual tillage practices effectively mix the top layer of the soil such that soil samples represent at least the top 30 centimeters of the soil profile. PCN program sampling rates are higher than those used by many other countries where PCN infestations are widespread and have been present for decades. Lower sampling rates are generally used for managing high infestations and reducing economic impacts of the pest, not for eradicating nor limiting spread of the pest.

To evaluate a field for PCN under the confirmatory protocol, a soil sample is required. Sanitary requirements for entering a field (boots, washing of tools), soil bagging and labeling, and vehicle disinfection are longstanding and widely observed practices used by APHIS to prevent the spread of plant pests from infected fields.

The protocol for determining infested field regulation for PCN is based on our knowledge about the biology and epidemiology of PCN. Specimens from a soil sample must be definitively identified and confirmed by an APHIS-approved laboratory using morphological and molecular DNA-based methods. Molecular methods provide an additional, confirmatory step along with morphological methods.

Details of APHIS' use of DNA and morphological/morphometric identification of PCN are described in a 2007 scientific article, 13 which is provided via a link in the confirmatory protocol. In the 1990s, nematologists began using DNA technology extensively for identification purposes, while morphological identification of nematodes has been widely in practice for decades. The technical minimum threshold for declaring a field infested/positive for PCN is met by detecting a minimum of two cysts from two samples that were identified as PCN by morphological/morphometric analysis, and at least one of the cysts was viable and confirmed as PCN by molecular (DNA) analysis. It is not necessary for the two samples to come from the same survey event.

The protocol for determining associated field regulation is modeled in part after the USDA Golden Nematode Program and its criteria for determining “exposed land” as described in the USDA Golden Nematode Manual (2006 version). 14 Unlike the Golden Nematode Program approach of regulating large blocks of land or entire counties, the PCN Program adopted a more conservative field-by-field regulatory approach in which only confirmed infested fields and those at high risk for infestation are regulated. Associated fields are identified through the process of researching an infested field's history, going back 10 years, to identify other fields that may have been exposed to infested field soil.

Fields that APHIS has determined to be infested with PCN are eligible for release under a deregulation protocol if the field is used for host crop production. The infested field deregulation protocol employs strategies that have been used for decades to control nematodes on potatoes and other crops.

In the Infested Field Deregulation Protocol, APHIS conducts an initial full field survey in a fixed grid pattern at an 80,000 cc of soil per acre sampling rate. The sampling results (number of cysts per sample) are used to map the relative distribution and population of cysts in the field, and infestation foci are located. The fixed grid survey is a standard industry practice for monitoring several types of field activities, including mapping infestations and monitoring pest eradication treatments. For instance, one study APHIS drew upon in developing the protocols describes a method for PCN soil sampling by which a field is divided into 20 x 20 meter grid squares, then soil samples are collected from each grid. The samples are processed to separate cysts from the soil, and the number of cysts per grid is determined by counting. The results of the cyst counts are plotted to produce a map of the infestation across the field. 15 Identifying infestation foci informs soil treatment decisions and cost-effective monitoring of treatment efficacy over time. This method is the basis for the PCN program's mapping surveys and subsequent grid monitoring surveys.

The PCN sampling method for infested fields is based on a 2 x 2 grid pattern method (subsamples are collected 2 paces apart, every 2 paces) modeled in part after a grid survey method described in GN program manuals from 1992 and 2006. The 2006 manual describes the steps for such a survey, beginning with measuring the dimensions of the field, dividing the field into a grid, and sampling the soil following the grid pattern. If nematodes are located in a sample, the grid makes it possible to trace that sample back to a location in the field. 16

After sampling results are determined, a field may undergo a series of optional, PCN program-sponsored eradication treatments, which are monitored according to initial grid survey results. These treatments are conducted at the discretion of the grower. Eradication treatments have included Telone® II fumigation and the trap crop litchi tomato. Telone® and Telone® II have been widely employed as a nematicide for control of all major species of nematodes throughout the United States, as has litchi tomato as a trap crop in other countries. Trap crops, which have been used for decades to control nematodes, can be effective in reducing yield loss in potatoes and other crops when used as part of a crop rotation, or in conjunction with the use of nematicides. 17

Host crops may be grown consecutively or in a crop rotation. A field is eligible for full deregulation if no viable cysts are detected after each of three host crops are harvested. 18 The scientific rationale for requiring three crops is to allow multiplication and detection of any low-level PCN populations prior to release.

In the Infested Field Deregulation Protocol, initial cyst viability is assessed using a live/dead staining assay. The staining assay to determine viability is a standard procedure in nematology as it allows for clearer visual identification of the organism. To evaluate the efficacy of a treatment for cyst nematode control, determining if a nematode is dead or alive is important. The lack of movement of a nematode does not signify death in species like Heterodera spp. (cyst nematodes). 19 Since the egg is protected in a resistant structure, living (viable) and dead (nonviable) eggs cannot be distinguished by direct observation. Various dyes and stains have been used to visualize and then ascertain viability of nematode eggs.

To become deregulated, a field must complete a series of tests to demonstrate that the infestation has been fully eradicated. In classical nematology, the standard method to determine PCN viability is based on a staining assay, using Meldola's blue dye (MB) followed by microscopic visualization of MB‐treated nematodes. Nematode staining techniques are widely accepted by the majority of nematology laboratories and have been for decades. 20 One study presents a novel hatching bioassay technique developed for golden nematode, in which the authors illustrated the feasibility and advantages of a hatching bioassay system using staining and fluorescence microscopy. Another study  21 published in 1996 discusses the results of PCN infectivity assays using staining techniques similar to those we prescribe in the deregulation protocol. We also note that the 1968 USDA Golden Nematode Program Manual includes viability testing to monitor efficacy of chemical treatments.

As part of the infested field protocol, we also assess cyst viability using a greenhouse bioassay method (equivalent to three consecutive susceptible potato crops) or an in-field bioassay method (three consecutive crops grown in infestation foci or over the entire field). Greenhouse and field bioassays are used throughout the world to evaluate pest viability and other biological characteristics. 22

The primary determination for a field to become regulated as an associated field is exposure of that field to soil or other regulated articles from an infested field. Pressure washing sanitation requirements, explained above, are implemented for all equipment in contact with field soil. These requirements are necessary to mitigate the potential spread of PCN from associated fields that are considered high risk for PCN infestation. Other regulatory requirements are implemented for movement of commodities and articles from the field that cannot be sanitized. For PCN, a full‐field delimiting survey at a sampling rate of 8,000 cc of soil per acre (equivalent to approximately 20 pounds of soil per acre) is used to determine its presence in associated fields. A series of two negative delimiting surveys, each following harvest of two host crops grown on the field, is required to deregulate an associated field. The current deregulation protocol was adopted by APHIS in 2012 at the request of cooperators and stakeholders that were impacted, including the Idaho State Department of Agriculture, Idaho Potato Commission, and owners and operators of infested and associated fields.

Delimiting surveys are a common practice that have been included in APHIS emergency response manuals and used by several APHIS, State, and international programs. For example, a Japanese Beetle Harmonization plan, adopted by the National Plant Board in 1998, uses the same concept as the PCN deregulation protocol of conducting detection surveys followed by a more robust delimiting survey. This Japanese beetle harmonization plan was implemented by the Idaho State Department of Agriculture in Boise, Idaho in 2013 after detection of the beetle in 2012. 23

A deregulation option exists for regulated fields where agriculture still occurs but where all host crop production was prohibited or has ceased for a minimum of 30 years. This could include infested or associated status fields. During the 30-year time period, the fields may have been used for various purposes, including but not limited to hobby farms, fallow fields, forage crops, grain fields, nurseries, or pasture. PCN can remain viable for approximately 30 years in the absence of a host crop. 24

To become deregulated, fields no longer in host crop production must complete a two-step process. Records must be made available to APHIS to demonstrate that the land has been out of host crop production for the last 30 years. APHIS then surveys the entire field at a rate of 8,000 cc soil per acre (equivalent to approximately 20 pounds of soil per acre). This dual approach establishes a 30-year period in which the field is out of host production, making it much less likely that PCN is present, and in the present establishes whether any viable PCN remains.

A deregulation option also exists for regulated fields that have been converted to non-agricultural uses. This could include infested or associated status fields. Examples of non-agricultural uses include such things as highways and other paved roads and commercial, industrial or residential development.

To become deregulated, fields converted to non-agricultural uses must have records available to determine the land has been out of agricultural use for at least the last 20 years and will not return to production, or construction for non-agricultural proposes has rendered the land non-tillable and is not likely to return to agricultural production. The risk of PCN spread and establishment from these non-agricultural fields is lower than those remaining in non-PCN host agricultural production, resulting in the lower number of years required for release. In the APHIS Karnal Bunt Program, which has been in place since 1996, a similar provision in the regulations  25 has been used successfully to lower or eliminate the risk of Karnal Bunt if the land cannot be farmed.

In order to give the public an opportunity to consider the science on which we have established the field protocols and the sources we have used to develop them, we are reopening the comment period on Docket No. APHIS-2018-0041 for an additional 30 days. This action will allow interested persons additional time to prepare and submit comments.

Table of Contents I. Introduction A. Authority and Background B. Rulemaking History II. Request for Information A. Scope and Definitions B. Test Procedure 1. Industry Standard 2. Water Pressure C. Other Test Procedure Topics III. Submission of Comments I. Introduction

DOE's test procedures for commercial prerinse spray valves are prescribed at Subpart O of 10 CFR part 431. The following sections discuss DOE's authority to establish and amend test procedures for commercial prerinse spray valves and relevant background information regarding DOE's consideration of test procedures for this equipment.

The Energy Policy and Conservation Act, as amended (“EPCA”), 1 among other things, authorizes DOE to regulate the energy efficiency of a number of consumer products and certain industrial equipment. (42 U.S.C. 6291-6317) Title III, Part B  2 of EPCA established the Energy Conservation Program for Consumer Products Other Than Automobiles, which includes commercial prerinse spray valves. EPCA provides for the definition of commercial prerinse spray valve at 42 U.S.C. 6291(33), the test procedure under 42 U.S.C. 6293(b)(14), and energy conservation standards (in terms of flow rate) under 42 U.S.C. 6295(dd). 3

The energy conservation program under EPCA consists essentially of four parts: (1) Testing, (2) labeling, (3) Federal energy conservation standards, and (4) certification and enforcement procedures. Relevant provisions of EPCA specifically include definitions (42 U.S.C. 6291), test procedures (42 U.S.C. 6293), labeling provisions (42 U.S.C. 6294), energy conservation standards (42 U.S.C. 6295), and the authority to require information and reports from manufacturers (42 U.S.C. 6296).

Federal energy efficiency requirements for covered products established under EPCA generally supersede State laws and regulations concerning energy conservation testing, labeling, and standards. (42 U.S.C. 6297) DOE may, however, grant waivers of Federal preemption for particular State laws or regulations, in accordance with the procedures and other provisions of EPCA. (42 U.S.C. 6297(d)).

The Federal testing requirements consist of test procedures that manufacturers of covered products must use as the basis for: (1) Certifying to DOE that their products comply with the applicable energy conservation standards adopted pursuant to EPCA (42 U.S.C. 6295(s)), and (2) making representations about the efficiency of those consumer products (42 U.S.C. 6293(c)). Similarly, DOE must use these test procedures to determine whether the products comply with relevant standards promulgated under EPCA. (42 U.S.C. 6295(s)).

Under 42 U.S.C. 6293, EPCA sets forth the criteria and procedures DOE must follow when prescribing or amending test procedures for covered products. EPCA requires that any test procedures prescribed or amended under this section be reasonably designed to produce test results which measure energy efficiency, energy use or estimated annual operating cost of a covered product during a representative average use cycle or period of use and not be unduly burdensome to conduct. (42 U.S.C. 6293(b)(3)).

If DOE determines that a test procedure amendment is warranted, it must publish proposed test procedures and offer the public an opportunity to present oral and written comments on them. (42 U.S.C. 6293(b)(2)).

EPCA requires DOE to use American Society of Testing and Materials (“ASTM”) Standard F2324 (“ASTM F2324”) as the basis for the test procedure for measuring flow rate. (42 U.S.C. 6293(b)(14)) EPCA also requires that, at least once every seven years, DOE evaluate test procedures for each type of covered product, including commercial prerinse spray valves, to determine whether amended test procedures would more accurately or fully comply with the requirements for the test procedures to not be unduly burdensome to conduct and be reasonably designed to produce test results that reflect energy efficiency, energy use, and estimated operating costs during a representative average use cycle or period of use. (42 U.S.C. 6293(b)(1)(A)) If the Secretary determines, on his own behalf or in response to a petition by any interested person, that a test procedure should be prescribed or amended, the Secretary shall promptly publish in the Federal Register proposed test procedures and afford interested persons an opportunity to present oral and written data, views, and arguments with respect to such procedures. The comment period on a proposed rule to amend a test procedure shall be at least 60 days and may not exceed 270 days. In prescribing or amending a test procedure, the Secretary shall take into account such information as the Secretary determines relevant to such procedure, including technological developments relating to water use of the type (or class) of covered products involved. (42 U.S.C. 6293(b)(2) If DOE determines that test procedure revisions are not appropriate, DOE must publish its determination not to amend the test procedure. DOE is publishing this RFI to collect data and information to inform its decision in satisfaction of the seven-year review requirement specified in EPCA. (42 U.S.C. 6293(b)(1)(A)).

DOE last amended the current test procedure for commercial prerinse spray valves on December 30, 2015, when DOE incorporated by reference the updated version of ASTM Standard F2324, i.e., the 2013 version (“ASTM F2324-13”). 80 FR 81441 (“December 2015 CPSV Final Rule”). Prior to the December 2015 CPSV Final Rule, DOE had incorporated by reference the 2009 version of ASTM Standard F2324. In the December 2015 final rule, DOE also revised the definition of “commercial prerinse spray valve,” made minor changes to the DOE flow rate test method, and added a definition of “spray force” as well as a test method for measuring the spray force of commercial prerinse spray valves. On January 27, 2016, DOE published an energy conservation standards final rule that established three product classes based on spray force and established maximum flow rate requirements for each product class. 81 FR 4748, 4801.

In 2019, ASTM reaffirmed its 2013 standard (“ASTM F2324-13 (2019)”).

As an initial matter, DOE seeks comment on whether there have been changes in product testing methodology or new products on the market since the last test procedure update that may necessitate amendments to the test procedure for commercial prerinse spray valves. Specifically, DOE seeks data and information regarding whether the current test procedure produces results that are representative of an average use cycle for the product and is not unduly burdensome to conduct, and therefore does not need amendment.

In the following sections, DOE has also identified a variety of issues on which it seeks input to determine whether amended test procedures for commercial prerinse spray valves would more accurately or fully comply with the requirements in EPCA that test procedures: (1) Be reasonably designed to produce test results which reflect energy use during a representative average use cycle, and (2) not be unduly burdensome to conduct. (42 U.S.C. 6293(b)(3)).

DOE also issued an RFI to seek more information on whether its test procedures are reasonably designed, as required by EPCA, to produce results that measure the energy (and water) use or efficiency of a product during a representative average use cycle or period of use. 84 FR 9721 (March 18, 2019). DOE seeks comment on this issue as it pertains to the test procedure for commercial prerinse spray valves.

Additionally, DOE welcomes comments on other issues relevant to the conduct of this process. In particular, DOE notes that under Executive Order 13771, “Reducing Regulation and Controlling Regulatory Costs,” Executive Branch agencies, such as DOE, are directed to manage the costs associated with the imposition of expenditures required to comply with Federal regulations. See 82 FR 9339 (Feb. 3, 2017). Consistent with that Executive Order, DOE encourages the public to provide input on measures DOE could take to lower the cost of its regulations applicable to commercial prerinse spray valves consistent with the requirements of EPCA.

EPCA initially defined a “commercial prerinse spray valve” as “a handheld device designed and marketed for use with commercial dishwashing and ware washing equipment that sprays water on dishes, flatware, and other food service items for the purpose of removing food residue before cleaning the items.” (42 U.S.C. 6291(33)(A)) EPCA authorizes DOE to modify the definition of commercial prerinse spray valves by rule to include products (1) that are used extensively in conjunction with commercial dishwashing and ware washing equipment, (2) to which the application of standards would result in significant energy savings, and (3) to which the application of standards would not be likely to result in the unavailability of any covered product type currently available on the market. (42 U.S.C. 6291(33)(B)(i)) EPCA also authorizes DOE to modify the commercial prerinse spray valve definition to exclude products (1) that are used for special food service applications, (2) that are unlikely to be widely used in conjunction with commercial dishwashing and ware washing equipment, and (3) to which the application of standards would not result in significant energy savings. (42 U.S.C. 6291(33)(B)(ii)) In the December 2015 CPSV Final Rule, DOE amended the definition of commercial prerinse spray valve to “a handheld device that has a release-to-close valve and is suitable for removing food residue from food service items before cleaning them in commercial dishwashing or ware washing equipment.” 10 CFR 431.262.

In determining whether a product is suitable for removing food residue from food service items before cleaning them in commercial dishwashing or ware washing equipment, DOE considers various factors including channels of marketing and sales, product design and descriptions, and actual sales to determine whether the spray valve is used extensively in conjunction with commercial dishwashing and ware washing equipment. 81 FR 81441, 81444. For example, a product marketed or sold through outlets that market or sell to food service entities such as restaurants or commercial or institutional kitchens is more likely to be used as a commercial prerinse spray valve than one marketed or sold through outlets catering to pet care. Similarly, a product marketed outside of the United States as suitable for removing food residue from food service items before cleaning them in commercial dishwashing or ware washing equipment would be considered similarly suitable if distributed in the United States. DOE also considers how a product is marketed and sold to end-users, including how the product is identified and described in product catalogs, brochures, specification sheets, and communications with prospective purchasers. Id. Additionally, DOE considers actual sales, including whether the end-users are restaurants or commercial or institutional kitchens, even if those sales are indirect through an entity such as a distributor. Id.

Although manufacturers may market different categories of spray valves for various uses, such as cleaning floors or walls or filling glasses, any such device that is suitable for use in conjunction with commercial dishwashing and ware washing equipment to spray water for the purpose of removing food residue that is a handheld device that has a release-to-close valve is a commercial prerinse spray valve. See, 80 FR 35874, 35876-35877. Installation location is not a factor in determining whether a given model meets the definition of commercial prerinse spray valve. Id.

The CPSV definition generally does not include products that are commonly referred to as “pot fillers.” A pot filler would not be considered a commercial prerinse spray valve because it is not suitable to be used for rinsing dishware before washing in a commercial dishwasher. A pot filler is used to fill a container with water, whereas a commercial prerinse spray valve is used to remove food residue from dishware. Consumers generally would not install a pot filler to be used as a commercial prerinse spray valve. In addition, most pot fillers are usually rigidly mounted to a wall with a swing arm, and are thus not handheld devices. See, 80 FR 81444.

Issue 1: DOE requests comment on how manufacturers are currently applying the definition of “commercial prerinse spray valve.”

Issue 2: DOE requests comments on whether modifications to the definition are needed to more appropriately include products (1) that are used extensively in conjunction with commercial dishwashing and ware washing equipment, (2) to which the application of standards would result in significant energy savings, and (3) to which the application of standards would not be likely to result in the unavailability of any covered product type currently available on the market. DOE also requests comments on whether the definition should be modified to more appropriately exclude products (1) that are used for special food service applications, (2) that are unlikely to be widely used in conjunction with commercial dishwashing and ware washing equipment, and (3) to which the application of standards would not result in significant energy savings. If modifications are needed, DOE requests comment on how commercial prerinse spray valve should be defined.

Currently, DOE's test procedure for commercial prerinse spray valves at 10 CFR part 431.263 incorporates by reference ASTM Standard F2324-13. The applicable sections of ASTM Standard F2324-13 are sections 6.1 through 6.9 (except 6.4 and 6.7), 9.1 through 9.4, and 10.1 through 10.2.5 for the flow rate test method with calculations conducted according to section 11.3.1; and sections 6.2 and 6.4 through 6.9, 9.1 through 9.5.3.2, and 10.3.1 through 10.3.8 for the spray force test method.

Since publication of the December 2015 final rule, ASTM F2324-13 has been reapproved to ASTM F2324-13 (2019). The 2019 version contains no changes from the 2013 version.

Issue 3: DOE requests comments on updating the CPSV test procedure references to incorporate the reaffirmed industry standard ASTM F2324-13 (2019), and confirmation that such an update would not result in any substantive changes to the current test procedure.

As described previously, EPCA requires that any test procedures prescribed or amended by DOE be reasonably designed to produce test results which measure energy (and water) efficiency, energy (and water) use or estimated annual operating cost of a covered product during a representative average use cycle or period of use and not be unduly burdensome to conduct. (42 U.S.C. 6293(b)(3)) ASTM F2324-13 specifies testing with a water pressure of 60 ± 2 pounds per square inch (“psi”). In the December 2015 CPSV Final Rule, DOE concluded that 60 psi is representative of the water pressures observed across the nation, based on review of water pressure data for commercial kitchens across the U.S. 80 FR 81441, 81446-81447.

Issue 4: DOE requests data and comment on whether the test pressure of 60 ± 2 psi continues to be representative of average U.S. water pressures in commercial kitchen settings.

In addition to the issues identified earlier in this document, DOE welcomes comment on any other aspect of the existing test procedures for commercial prerinse spray valves. As noted previously, DOE recently issued an RFI to seek more information on whether its test procedures are reasonably designed, as required by EPCA, to produce results that measure the energy (and water) use or efficiency of a product during a representative average use cycle or period of use. 84 FR 9721 (Mar. 18, 2019). DOE seeks comment on this issue as it pertains to the test procedure for commercial prerinse spray valves.

DOE also requests comments on whether potential amendments based on the issues discussed would result in a test procedure that is unduly burdensome to conduct, particularly in light of any new equipment on the market since the last test procedure update. As discussed, the DOE test procedure incorporates specific provisions of the industry standard ASTM F2324-13. DOE also requests comment on the benefits and burdens of adopting any industry/voluntary consensus-based or other appropriate test procedure, without modification.

Additionally, DOE requests comment on whether the existing test procedures limit a manufacturer's ability to provide additional features to consumers on commercial prerinse spray valves. DOE particularly seeks information on how the test procedures could be amended to reduce the cost of new or additional features and make it more likely that such features are included on commercial prerinse spray valves, while still meeting the requirements of EPCA.

Finally, DOE also requests comments on any potential amendments to the existing test procedure that would address impacts on manufacturers, including small businesses.

DOE invites all interested parties to submit in writing by July 6, 2020, comments and information on matters addressed in this notice and on other matters relevant to DOE's consideration of amended test procedures for commercial prerinse spray valves. These comments and information will aid in the development of a test procedure NOPR for commercial prerinse spray valves if DOE determines that amended test procedures may be appropriate for this equipment.

Submitting comments via http://www.regulations.gov. The http://www.regulations.gov web page will require you to provide your name and contact information. Your contact information will be viewable to DOE Building Technologies staff only. Your contact information will not be publicly viewable except for your first and last names, organization name (if any), and submitter representative name (if any). If your comment is not processed properly because of technical difficulties, DOE will use this information to contact you. If DOE cannot read your comment due to technical difficulties and cannot contact you for clarification, DOE may not be able to consider your comment.

However, your contact information will be publicly viewable if you include it in the comment or in any documents attached to your comment. Any information that you do not want to be publicly viewable should not be included in your comment, nor in any document attached to your comment. Persons viewing comments will see only first and last names, organization names, correspondence containing comments, and any documents submitted with the comments.

Do not submit to http://www.regulations.gov information for which disclosure is restricted by statute, such as trade secrets and commercial or financial information (hereinafter referred to as Confidential Business Information (“CBI”)). Comments submitted through http://www.regulations.gov cannot be claimed as CBI. Comments received through the website will waive any CBI claims for the information submitted. For information on submitting CBI, see the Confidential Business Information section.

DOE processes submissions made through http://www.regulations.gov before posting. Normally, comments will be posted within a few days of being submitted. However, if large volumes of comments are being processed simultaneously, your comment may not be viewable for up to several weeks. Please keep the comment tracking number that http://www.regulations.gov provides after you have successfully uploaded your comment.

Submitting comments via email, hand delivery/courier, or postal mail. Comments and documents submitted via email, hand delivery/courier, or postal mail also will be posted to http://www.regulations.gov. If you do not want your personal contact information to be publicly viewable, do not include it in your comment or any accompanying documents. Instead, provide your contact information on a cover letter. Include your first and last names, email address, telephone number, and optional mailing address. The cover letter will not be publicly viewable as long as it does not include any comments.

Include contact information each time you submit comments, data, documents, and other information to DOE. If you submit via postal mail or hand delivery/courier, please provide all items on a CD, if feasible. It is not necessary to submit printed copies. No facsimiles (faxes) will be accepted.

Comments, data, and other information submitted to DOE electronically should be provided in PDF (preferred), Microsoft Word or Excel, WordPerfect, or text (ASCII) file format. Provide documents that are not secured, written in English and free of any defects or viruses. Documents should not contain special characters or any form of encryption and, if possible, they should carry the electronic signature of the author.

Campaign form letters. Please submit campaign form letters by the originating organization in batches of between 50 to 500 form letters per PDF or as one form letter with a list of supporters' names compiled into one or more PDFs. This reduces comment processing and posting time.

Confidential Business Information. According to 10 CFR 1004.11, any person submitting information that he or she believes to be confidential and exempt by law from public disclosure should submit via email, postal mail, or hand delivery/courier two well-marked copies: one copy of the document marked confidential including all the information believed to be confidential, and one copy of the document marked “non-confidential” with the information believed to be confidential deleted. Submit these documents via email or on a CD, if feasible. DOE will make its own determination about the confidential status of the information and treat it according to its determination.

It is DOE's policy that all comments may be included in the public docket, without change and as received, including any personal information provided in the comments (except information deemed to be exempt from public disclosure).

DOE considers public participation to be a very important part of the process for developing test procedures and energy conservation standards. DOE actively encourages the participation and interaction of the public during the comment period in each stage of this process. Interactions with and between members of the public provide a balanced discussion of the issues and assist DOE in the process. Anyone who wishes to be added to the DOE mailing list to receive future notices and information about this process should contact Appliance and Equipment Standards Program staff at (202) 287-1445 or via email at ApplianceStandardsQuestions@ee.doe.gov.

This document of the Department of Energy was signed on May 8, 2020, by Alexander N. Fitzsimmons, Deputy Assistant Secretary for Energy Efficiency, pursuant to delegated authority from the Secretary of Energy. That document with the original signature and date is maintained by DOE. For administrative purposes only, and in compliance with requirements of the Office of the Federal Register, the undersigned DOE Federal Register Liaison Officer has been authorized to sign and submit the document in electronic format for publication, as an official document of the Department of Energy. This administrative process in no way alters the legal effect of this document upon publication in the Federal Register .

The Board proposes to amend its share insurance regulation governing the requirements for a share account to be insured separately as a joint account. 1 Specifically, this proposal addresses the requirement for separate joint account insurance that each co-owner of a joint account has personally signed a membership card or account signature card. In the event a federally insured credit union (FICU) could not produce from its records such membership cards or account signature cards, this proposal would explicitly permit the use of other evidence contained in a FICU's account records to satisfy the signature card requirement. The proposal discusses examples of such evidence more fully in the sections that follow.

This amendment would mirror a change made by the Federal Deposit Insurance Corporation (FDIC) in 2019 for federally insured depository institutions. 2 This proposed rule is intended to facilitate the prompt payment of share insurance in the event of a FICU's failure by explicitly providing alternative methods that the NCUA could use to determine the owners of joint accounts, consistent with the NCUA's statutory authority. The Board emphasizes that this change is not in reaction to any observed current problem with respect to identifying qualifying joint accounts at credit unions and processing insurance payments timely. Rather, the Board is issuing this proposed rule because it is important to maintain parity between the nation's two federal deposit/share insurance programs and to provide credit union members with equal access to insurance coverage. These regulatory changes would promote further confidence in the credit union system and embody a forward-looking approach that would explicitly permit the use of new and innovative technologies and processes to meet the NCUA's policy objectives.

Under the Federal Credit Union Act (FCU Act), the NCUA is responsible for paying share insurance to any member, or to any person with funds lawfully held in a member account, in the event of a FICU's failure up to the standard maximum share insurance amount (SMSIA), which is currently set at $250,000. 3 The FCU Act states that the determination of the net amount of share insurance paid “shall be in accordance with such regulations as the Board may prescribe” and requires that, “in determining the amount payable to any member, there shall be added together all accounts in the credit union maintained by that member for that member's own benefit, either in the member's own name or in the names of others.”  4 However, the FCU Act also specifically authorizes the Board to “define, with such classifications and exceptions as it may prescribe, the extent of the share insurance coverage provided for member accounts, including member accounts in the name of a minor, in trust, or in joint tenancy.”  5

The NCUA has implemented these requirements by issuing regulations recognizing particular categories of accounts, such as single ownership accounts and joint ownership accounts. 6 If an account meets the requirements for a particular category, the account is insured up to the $250,000 limit separately from shares held by the member in a different account category at the same FICU. For example, provided all requirements are met, shares in the single ownership category will be separately insured from shares in the joint ownership category held by the same member at the same FICU.

Section 745.8 of the NCUA's regulations governs insurance coverage for joint ownership accounts. 7 Joint ownership accounts include share accounts held pursuant to various forms of co-ownership under state law. For example, joint tenants could each hold an equal, undivided interest in a share account. Section 745.8 provides that only “qualifying joint accounts” are insured separately from individually owned share accounts maintained by the co-owners. 8 “Qualifying joint accounts” generally must satisfy two requirements: (1) Each co-owner has personally signed a membership card or account signature card; and (2) each co-owner possesses withdrawal rights on the same basis. 9 If a joint account is not a qualifying joint account, each co-owner's actual ownership interest in the account is considered individually owned and added to any other accounts individually owned by the co-owner and insured up to the SMSIA in the aggregate. 10 This may result in some uninsured shares if a member's single ownership accounts at the same FICU, including shares in any non-qualifying joint accounts, exceed $250,000. Additionally, it is worth reiterating that, with limited exceptions, the FCU Act generally limits NCUA share insurance coverage to “member accounts.”  11 Despite this general limitation, the FCU Act  12 and the NCUA's regulations  13 do allow a nonmember to become a joint owner with a member on a joint account with right of survivorship. The regulations provide that a nonmember's interest in such accounts will be insured in the same manner as the member joint-owner's interest.

The signature requirement has been included in the regulation governing insurance coverage since its inception in 1971. 14 The FDIC has had a substantially similar signature requirement since 1967. 15 In originally adopting this requirement, the FDIC “intended to address practices such as the addition of nominal co-owners to an account solely to increase deposit insurance coverage.”  16 The NCUA thereafter adopted a substantially similar requirement  17 and views it as a reliable indicator of account ownership and important to ensuring consistency with the FCU Act, which expressly limits the net amount of share insurance payable to any member, or person with funds lawfully held in a member account, based on the member account classifications prescribed by the Board. 18

Neither the FCU Act nor the NCUA's regulations define the terms “membership card” or “account signature card.” In implementing § 745.8, the NCUA has not required any particular format for a membership card or account signature card. Therefore, the agency has previously permitted FICUs to satisfy the requirement through various forms of documentation used in their account opening processes. The Board also wishes to reiterate that, consistent with the Electronic Signatures in Global and National Commerce Act (E-Sign Act), 19 the signature requirement may be satisfied electronically. This has been the NCUA's long-standing position.

The Board has issued this proposed rule pursuant to its authority under the FCU Act. Under the FCU Act, the NCUA is the chartering and supervisory authority for FCUs and the Federal supervisory authority for FICUs. 20 The FCU Act grants the NCUA a broad mandate to issue regulations governing both FCUs and FICUs. Section 120 of the FCU Act is a general grant of regulatory authority and authorizes the Board to prescribe rules and regulations for the administration of the FCU Act. 21 Section 207 of the FCU Act is a specific grant of authority over share insurance coverage, conservatorships, and liquidations. 22 Section 209 of the FCU Act is a plenary grant of regulatory authority to the NCUA to issue rules and regulations necessary or appropriate to carry out its role as share insurer for all FICUs. 23 Accordingly, the FCU Act grants the Board broad rulemaking authority to ensure that the credit union industry and the NCUSIF remain safe and sound.

The Board is proposing to amend § 745.8 to explicitly provide for an alternative method to satisfy the signature card requirement. The proposed rule would specifically allow the signature card requirement to be satisfied by information contained in the account records of the FICU establishing the co-ownership of the share account, such as evidence that the FICU has issued a mechanism for accessing the account to each co-owner or evidence of usage of the share account by each co-owner. For example, under this proposal, the requirement could be satisfied by evidence that a FICU has issued a debit card to each co-owner of the account or evidence that each co-owner of the account has conducted transactions using the share account. These examples, however, are not intended to define the only forms of evidence of co-ownership that could satisfy the signature requirement. To the contrary, the evidence found in a FICU's account records could take many other forms.

The proposed rule only would affect a requirement in the NCUA's regulations that must be satisfied for a share account to be separately insured as a joint account; it would not affect any other legal requirements applicable to FICUs. FICUs may, for legal or other reasons, find it appropriate or necessary to continue collecting customers' signatures. 24 The changes made by the proposed rule would not modify or affect any state law requirements generally applicable to FICUs.

The proposal also would not affect the general principles contained in § 745.2 of the NCUA's share insurance regulations applicable in determining insurance of accounts. 25 These general principles applicable in determining insurance of accounts would continue to apply to all share accounts, including joint ownership accounts.

The proposed rule would not introduce any new requirements for an account to be insured as a joint account, and would not reduce or affect insurance coverage for any account for which the existing joint account requirements are satisfied. The proposed rule simply would provide an alternative method to satisfy the existing signature card requirement. If each co-owner of a joint account signs, or has previously signed, a membership card or account signature card in accordance with the existing requirement and the FICU can produce it, then the proposed alternative method would be unnecessary. Assuming that the remaining qualifying joint account requirement is satisfied—that is, both co-owners possess equal withdrawal rights—and all other membership requirements are met, 26 the account would be insured as a joint account. The proposal would apply to all FICUs and would not impose any increased burden or new recordkeeping requirements for joint accounts.

The rule also provides non-quantifiable benefits to owners of joint accounts. By explicitly providing alternative methods that the NCUA could use to determine the owners of joint accounts, the proposed rule would further support a prompt share insurance determination in the event of a FICU's failure, alleviating delays in the recognition of account ownership and uncertainty regarding the extent of share insurance coverage. These benefits would promote confidence in the credit union system and NCUA-insured shares.

The NCUA invites comments on all aspects of the proposal.

The Regulatory Flexibility Act (RFA) generally requires that, in connection with a notice of proposed rulemaking, an agency prepare and make available for public comment an initial regulatory flexibility analysis that describes the impact of a proposed rule on small entities. A regulatory flexibility analysis is not required, however, if the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities (defined for purposes of the RFA to include FICUs with assets less than $100 million) and publishes its certification and a short, explanatory statement in the Federal Register together with the rule. The proposed rule explicitly allows the NCUA to look to information contained in the account records of a FICU in order to satisfy the signature card requirement at the time of a FICU's failure. As a result, it will not cause any increased burden on FICUs and will not have an impact on small credit unions. Accordingly, the NCUA certifies that the proposed rule will not have a significant economic impact on a substantial number of small credit unions.

The Paperwork Reduction Act of 1995 (PRA) applies to rulemakings in which an agency creates a new or amends existing information collection requirements. 27 For the purpose of the PRA, an information collection requirement may take the form of a reporting, recordkeeping, or a third-party disclosure requirement. The proposed rule does not contain information collection requirements that require approval by OMB under the PRA. 28 The proposed rule will merely allow the NCUA to look to information contained in the account records of a FICU in order to satisfy the signature card requirement at the time of a FICU's failure.

Executive Order 13132 encourages independent regulatory agencies to consider the impact of their actions on state and local interests. In adherence to fundamental federalism principles, the NCUA, an independent regulatory agency as defined in 44 U.S.C. 3502(5), voluntarily complies with the executive order. This rulemaking will not have a substantial direct effect on the states, on the connection between the national government and the states, or on the distribution of power and responsibilities among the various levels of government. The NCUA has determined that this proposal does not constitute a policy that has federalism implications for purposes of the executive order.

The NCUA has determined that this final rule will not affect family well-being within the meaning of Section 654 of the Treasury and General Government Appropriations Act, 1999. 29

For the reasons discussed above, the NCUA Board proposes to amend 12 CFR part 745 as follows:

I. Background

The Prohibition of Energy Market Manipulation Rule (“Energy Market Manipulation Rule” or “Rule”), authorized by the Energy Independence and Security Act of 2007 (“EISA”) (42 U.S.C. 17301-17305), prohibits market manipulation in connection with the purchase or sale of crude oil or petroleum products. The Rule, initially promulgated by the Commission on November 4, 2009, prohibits fraudulent or deceptive conduct (including making false or misleading statements of material fact) in connection with wholesale purchases or sales of crude oil, gasoline, or petroleum distillates. The Rule separately bans the intentional failure to state a material fact when the omission (1) makes the statement misleading and (2) distorts or is likely to distort market conditions for any product covered by the Rule. The Commission formally adopted the Rule on November 4, 2009.

The Commission reviews its rules and guides periodically to seek information about their costs and benefits, regulatory and economic impact, and general effectiveness in protecting consumers and helping industry avoid deceptive claims. These reviews assist the Commission in identifying rules and guides that warrant modification or rescission.

With this document, the Commission initiates its review of the Energy Market Manipulation Rule. The Commission solicits comments on, among other things, the economic impact of, and the continuing need for, the Rule, the Rule's benefits to consumers, and the burdens it places on industry members subject to the Rule's requirements, including small businesses.

To aid commenters in submitting information, the Commission has prepared the following specific questions related to the Energy Market Manipulation Rule. The Commission seeks comments on these and any other issues related to the Rule's current requirements. In their replies, commenters should provide any available evidence and data that supports their positions, such as empirical data, consumer perception studies, and consumer complaints.

(1) Need: Is there a continuing need for the Rule? Why or why not?

(2) Benefits and Costs to Consumers: What benefits has the Rule provided to consumers, and does the Rule impose any significant costs on consumers?

(3) Benefits and Costs to Industry Members: What benefits, if any, has the Rule provided to businesses, and does the Rule impose any significant costs, including costs of compliance, on businesses, including small businesses?

(4) Changes:

a. What modifications, if any, should the Commission make to the Rule to increase its benefits or reduce its costs? How would these modifications affect the costs and benefits of the Rule for consumers? How would these modifications affect the costs and benefits of the Rule for businesses, particularly small businesses?

b. Is there evidence of acts or practices in connection with the purchase or sale of wholesale petroleum that violate the antitrust or consumer protection laws and that fall within the statutory prohibition of “any manipulative or deceptive device or contrivance,” but which § 317.3 does not reach?

c. The Rule defines “knowingly” to mean “that the person knew or must have known that his or her conduct was fraudulent or deceptive.” 16 CFR 317.2(c).

i. Has this definition prevented the Commission's Rule from addressing behavior that is within the meaning of 42 U.S.C. 17301?

ii. Specifically, would changing the definition of knowingly to capture acts, practices, or courses of business that a person “knew or should have known” was fraudulent or deceptive, or changing the definition in some other manner that tracks the statutory language, enhance the Commission's ability to address behavior in wholesale petroleum markets that is within the meaning of 42 U.S.C. 17301? Commenters should address any costs and benefits to wholesale petroleum markets and industry participants from modifying the definition.

(5) Impact on Information: What impact has the Rule had on the flow of truthful information to consumers and on the flow of deceptive information to consumers?

(6) Compliance: Provide any evidence concerning the degree of industry compliance with the Rule. Does this evidence indicate that the Rule should be modified? If so, why, and how? If not, why not?

(7) Unnecessary Provisions: Provide any evidence concerning whether any of the Rule's provisions are no longer necessary. Explain why these provisions are unnecessary.

(8) Technological or Economic Changes: What modifications, if any, should be made to the Rule to account for current or impending changes in technology or economic conditions? How would these modifications affect the costs and benefits of the Rule for consumers and businesses, particularly small businesses?

(9) Conflicts with Other Requirements: Does the Rule overlap or conflict with other federal, state, or local laws or regulations? If so, how? Provide any evidence that supports your position. With reference to the asserted conflicts, should the Rule be modified? If so, why, and how? If not, why not?

You can file a comment online or on paper. For the FTC to consider your comment, we must receive it on or before September 3, 2020. Write “Energy Market Manipulation Rule, 16 CFR part 317, Project No. P082900)” on your comment. Because of the public health emergency in response to the COVID-19 outbreak and the agency's heightened security screening, postal mail addressed to the Commission will be subject to delay. We strongly encourage you to submit your comment online through the https://www.regulations.gov website. To ensure the Commission considers your online comment, please follow the instructions on the web-based form provided by regulations.gov. Your comment, including your name and your state, will be placed on the public record of this proceeding, including the https://www.regulations.gov website.

If you file your comment on paper, write “Energy Market Manipulation Rule, 16 CFR part 317, Project No. P082900” on your comment and on the envelope, and mail it to the following address: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW, Suite CC-5610 (Annex J), Washington, DC 20580, or deliver your comment to the following address: Federal Trade Commission, Office of the Secretary, Constitution Center, 400 7th Street SW, 5th Floor, Suite 5610 (Annex J), Washington, DC 20024. If possible, please submit your paper comment to the Commission by courier or overnight service.

Because your comment will be placed on the publicly accessible website at www.regulations.gov, you are solely responsible for making sure that your comment does not include any sensitive or confidential information. In particular, your comment should not include any sensitive personal information, such as your or anyone else's Social Security number; date of birth; driver's license number or other state identification number, or foreign country equivalent; passport number; financial account number; or credit or debit card number. You are also solely responsible for making sure that your comment does not include any sensitive health information, such as medical records or other individually identifiable health information. In addition, your comment should not include any “trade secret or any commercial or financial information which . . . is privileged or confidential”—as provided by Section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2)—including in particular competitively sensitive information such as costs, sales statistics, inventories, formulas, patterns, devices, manufacturing processes, or customer names.

Comments containing material for which confidential treatment is requested must be filed in paper form, must be clearly labeled “Confidential,” and must comply with FTC Rule 4.9(c). In particular, the written request for confidential treatment that accompanies the comment must include the factual and legal basis for the request, and must identify the specific portions of the comment to be withheld from the public record. See FTC Rule 4.9(c). Your comment will be kept confidential only if the General Counsel grants your request in accordance with the law and the public interest. Once your comment has been posted publicly at https://www.regulations.gov —as legally required by FTC Rule 4.9(b)—we cannot redact or remove your comment unless you submit a confidentiality request that meets the requirements for such treatment under FTC Rule 4.9(c), and the General Counsel grants that request.

Visit the FTC website to read this request for comment and the news release describing it. The FTC Act and other laws that the Commission administers permit the collection of public comments to consider and use in this proceeding as appropriate. The Commission will consider all timely and responsive public comments that it receives on or before September 3, 2020. For information on the Commission's privacy policy, including routine uses permitted by the Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.

Public Participation

Interested persons are invited to participate in this rulemaking by submitting written data, views, or arguments on all aspects of this proposed rule. U.S. Customs and Border Protection (CBP) also invites comments that relate to the economic, environmental, or federalism effects that might result from this regulatory change. Comments that will provide the most assistance to CBP will reference a specific portion of the rule, explain the reason for any recommended change, and include data, information or authority that support such recommended change.

Section 641 of the Tariff Act of 1930, as amended (19 U.S.C. 1641), provides that individuals and business entities must hold a valid customs broker's license and permit to transact customs business on behalf of others. The statute also sets forth standards for the issuance of broker licenses and permits; provides for disciplinary action against brokers in the form of suspension or revocation of such licenses and permits or assessment of monetary penalties; and provides for the assessment of monetary penalties against other persons for conducting customs business without the required broker's license. Section 641 authorizes the Secretary of the Treasury to prescribe rules and regulations relating to the customs business of brokers as may be necessary to protect the public and the revenue of the United States and to carry out the provisions of section 641.

The regulations issued under the authority of section 641 are set forth in Part 111 of title 19 of the Code of Federal Regulations (CFR) (19 CFR part 111) and provide for, among other things, fee payment requirements applicable to brokers under section 641 and 19 U.S.C. 58c(a)(7).

The current customs brokers regulations are based on a district system in which ports within a district handle entry, entry summary, and post-summary activity and for which a broker district permit is required.

In a concurrent notice of proposed rulemaking, published elsewhere in this issue of the Federal Register ( see “Modernization of the Customs Brokers Regulations” RIN 1651-AB16), CBP proposes to amend the CBP regulations by modernizing the customs brokers regulations to coincide with the development of CBP trade initiatives including the Automated Commercial Environment (ACE) and the Centers of Excellence and Expertise (Centers). Specifically, CBP is proposing to transition all brokers to national permits and to expand the scope of the national permit authority to allow national permit holders to conduct any type of customs business throughout the customs territory of the United States. To accomplish this, CBP proposes to eliminate broker districts and district permits, which also eliminates the need for district permit waivers and for brokers to maintain district offices. This document proposes conforming amendments to Parts 24 and 111 to eliminate customs broker district permit fees.

Part 24 of title 19 of the CFR (19 CFR part 24) sets forth the regulations regarding customs financial and accounting procedures. Section 24.22 describes the customs Consolidated Omnibus Budget Reconciliation Act (COBRA) user fees and limitations for certain services. Specifically, paragraph (h) of section 24.22 describes the customs broker permit user fee. CBP proposes conforming amendments to sections 24.22(h) and (i)(9) to eliminate the customs broker district permit fee.

Section 111.19 provides the procedures for obtaining broker permits, responsible supervision and control requirements for permits, and review procedures for the denial of a permit. As further described in the concurrent notice of proposed rulemaking, published elsewhere in this issue of the Federal Register , CBP is proposing to eliminate district permits and move to a national permit-only system ( see “Modernization of the Customs Brokers Regulations” RIN 1651-AB16).

Section 111.19(c) describes permit fees. As CBP is proposing to eliminate district permits in a concurrent notice of proposed rulemaking, this document proposes conforming amendments to this section by eliminating fees for district permits. In addition, CBP proposes removing the specific permit application and permit user fee amounts and replacing the numerical figures with a reference to the relevant fee provision in sections 111.96(b) and (c). The proposed changes to section 111.96(b) can be found in the concurrent notice of proposed rulemaking.

Section 111.96 describes fees required throughout part 111. Paragraph (c) of section 111.96 describes the permit user fee. To reflect the proposed elimination of district permits, CBP proposes to eliminate the customs broker district permit fee. CBP also proposes to specify that the user fee is for national permits issued under section 111.19(a).

As discussed in the concurrent proposal “Modernization of the Customs Brokers Regulations” RIN 1651-AB16, CBP published an interim final rule that transferred certain trade functions from the port director to the Center director. Similarly, certain broker management functions previously performed by the port director will be transferred to the Centers as part of this proposed rule. CBP proposes to revise the last sentence of paragraph (c) by splitting it into two sentences, with the second sentence providing that the director of the designated Center will notify the broker in writing of the failure to pay and the revocation of the permit.

The authority for part 111 currently provides a specific authority citation for section 111.3. When the text of section 111.3 was transferred to section 111.2 in a final rule published in the Federal Register (65 FR 13880) on March 15, 2000, CBP inadvertently did not revise the specific authority citation for either section. CBP proposes to correct this by revising the specific authority citation for section 111.2 by adding that this section is also issued under 19 U.S.C. 1484 and 4798, and by removing the specific authority citation for section 111.3. An identical amendment is proposed in the concurrent document, “Modernization of the Customs Brokers Regulations” RIN 1651-AB16.

Executive Orders 13563 and 12866 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 (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. Executive Order 13771 (“Reducing Regulation and Controlling Regulatory Costs”) directs agencies to reduce regulation and control regulatory costs and provides that “for every one new regulation issued, at least two prior regulations be identified for elimination, and that the cost of planned regulations be prudently managed and controlled through a budgeting process.”

This rule is not a “significant regulatory action,” under section 3(f) of Executive Order 12866. Accordingly, OMB has not reviewed this regulation. As this rule is not a significant regulatory action, this rule is exempt from the requirements of Executive Order 13771. See OMB's Memorandum titled “Guidance Implementing Executive Order 13771, Titled `Reducing Regulation and Controlling Regulatory Costs'” (April 5, 2017). However, this rule is considered a deregulatory action under Executive Order 13771 and the estimated annualized savings to the public are $481,089. CBP has prepared the following analysis to help inform stakeholders of the impacts of this proposed rule.

The current customs brokers regulations are based on the district system in which entry, entry summary, and post-summary activity are all handled by the ports within a permit district. In the rule published concurrently (RIN 1651-AB16) with this proposed rule, CBP proposes to modernize the regulations governing customs brokers to better reflect the current work environment and streamline the customs broker permitting process to save money.

The customs territory of the United States is divided into seven customs regions. Within each region, the customs territory of the United States is further divided into districts; there are currently 40 customs districts. 1 Currently, a district permit is required for each district in which a customs broker intends to conduct customs business. Each district permit requires a one-time permit fee of $100 and an annual user fee of $141.70. A customs broker has the option of receiving his/her first district permit concurrently with the receipt of the customs broker license in which case the $100 permit fee is waived. In an effort to modernize the permitting process for customs brokers, the proposed rule published concurrently in the FR (RIN 1651-AB16) will eliminate the district permitting process and automatically grant each district permit holder a national permit.

Concurrently with this document, CBP is publishing a notice of proposed rulemaking that eliminates customs broker districts ( see “Modernization of the Customs Brokers Regulations” RIN 1651-AB16). CBP proposes to transition all brokers to national permits and to expand the scope of the national permit authority to allow national permit holders to conduct any type of customs business throughout the customs territory of the United States. By transitioning to a national permit, CBP proposes to eliminate the requirements for brokers to maintain district permits and pay the annual user fee. Consequently CBP proposes to eliminate customs broker district permit annual user fees. CBP has prepared the following analysis to help inform stakeholders of the impacts of this proposed rule.

Currently, the payment of an annual permit user fee of $141.70 is required for each permit that is granted to an individual, partnership, association, or corporate broker. The permit user fee is payable for each district and/or national permit a customs broker has, including when a district permit is issued concurrently with the broker's license. As a result of the concurrent CBP rule, district permits will be eliminated and customs brokers will only need to pay an annual user fee on a single national permit. 2

According to data from CBP's Broker Management Branch, as of January 2017 there were 2,093  3 brokers holding one or more district permits  4 that have 3,067 active district permits. This is an average of approximately 1.5 district permits per customs broker permit holder. Using this figure we can now project how many district permits brokers who currently hold at least one permit, would have had over the period of the analysis, from 2017 through 2021 under the baseline condition ( i.e., if this rule is not promulgated). This is shown in Exhibit 1 below.

Absent this rule, there would be 4,654 new individual licenses and 581 new corporate licenses issued for a total of 5,235 licenses ( see Exhibit 1). Using the aforementioned ratio of district permits to customs broker permit holders of 1.5 district permits to 1 customs broker permit holder, these 5,235 broker licenses would result in 7,853 district permits. According to CBP's Broker Management Branch, in addition to the 7,853 district permits that would be granted over the period of analysis, approximately 150 national permits are issued annually. This means that over the period of analysis from 2017 through 2021, 750 national permits will be granted to customs brokers in addition to the 7,853 district permits for a total of 8,603 permits. Absent this rule, these 8,603 permits would result in permit user fee charges of $1,219,045 (8,603 total permits * $141.70 annual permit user fee) over the period of the analysis. With this rule in place, the 5,235 total brokers would only receive a single national permit each for a total of 5,235 permits. This would result in permit user fee charges over the period of analysis of $741,800 (5,235 national permits * $141.70 annual permit user fee). This represents total savings to new customs brokers of $477,245 ($1,219,045 − $741,800) over the period of analysis. Please see Exhibit 2, below, for the estimated annual cost savings.

Current brokers that have more than one permit will also benefit from this rule. According to CBP's Broker Management Branch, as of January 2017 there were 1,319 brokers that either have more than one district permit or a combination of at least one district permit and a national permit. These 1,319 brokers currently hold a total of 3,613 permits which results in a ratio of 2.73 permits per broker (some of the existing brokers hold significantly more than the average of 1.5 permits per customs broker permit holder). Absent this rule, these permits would result in an annual permit user fee charge in 2017 of $511,962 (3,613 permits * $141.70 annual permit user fee) or $2,559,810 over the period of analysis from 2017 through 2021. As a result of this rule, the 1,319 brokers would only need to hold a single national permit for a total of 1,319 permits. This would result in an annual permit user fee charge in 2017 of $186,902 (1,319 national permits * $141.70 annual permit user fee) or $934,510 over the period of analysis. This represents an annual savings in 2017 of $325,060 ($511,962−$186,902) or $1,956,192 over the period of analysis to customs brokers who currently hold more than one permit. This also represents a decrease in the transfer payment from customs brokers to the government of $1,956,192 over the period of analysis from 2017 through 2021. Please see Exhibit 3, below, for the estimated annual cost savings for existing license holders.

The elimination of the annual user fee for district permits does not result in any costs to brokers, but as noted above the rule yields the aforementioned cost savings.

The total annual monetized cost savings for customs brokers are the result of monetary savings from switching from a district permitting system to a national permitting system. Specifically, the cost savings are the result of the payment of the annual permit user fee for only a single national permit instead of for each of the potentially several district permits a broker holds. As shown in Exhibit 4 below, total savings over the period of analysis are approximately $2.4 million dollars.

Exhibit 5 shows the total and annualized savings over the period of analysis (2017-2021) at a three (3) and seven (7) percent discount rate, per guidance provided in OMB Circular A-4. Total benefits range from approximately $2.1 to $2.3 million over the period of analysis. Annualized benefits are approximately $480,000.

Exhibit 6 summarizes the monetized costs and benefits of this rule to individual and business entity customs brokers. As shown, the total monetized present value net benefit of this rule over a 5-year period of analysis from 2017-2021 ranges from approximately $2.3 to $2.4 million and the annualized net benefit is approximately $500,000. In 2017, we estimate that 859 brokers will receive their broker licenses (762 individual licenses plus 97 corporate licenses). The adoption of this rule will result in an average annual net benefit per broker in 2017 of $560 ($481,089 annualized net benefit/859 total new brokers for 2017).

The Regulatory Flexibility Act (5 U.S.C. 601 et seq. ), as amended by the Small Business Regulatory Enforcement and Fairness Act of 1996, requires agencies to assess the impact of regulations on small entities. A small entity may be a small business (defined as any independently owned and operated business not dominant in its field that qualifies as a small business per the Small Business Act); a small not-for-profit organization; or a small governmental jurisdiction (locality with fewer than 50,000 people).

The proposed rule will apply to all customs brokers, regardless of size. Accordingly, the proposed rule will affect a substantial number of small entities. However, as stated above in the Executive Orders 13563, 12866, and 13771 section, the proposed rule will result in an average savings per customs broker of a discounted present value of $560. Since brokers, on average, will benefit as a result of this rule, and the savings are relatively small on a per broker basis, it will not have a significant impact on customs brokers. Accordingly, CBP certifies that this rule does not have a significant impact on a substantial number of small entities.

In accordance with the Paperwork Reduction Act of 1995 (Pub. L. 104-13, 44 U.S.C. 3507) an agency may not conduct, and a person is not required to respond to, a collection of information unless the collection of information displays a valid control number assigned by OMB. The collections of information contained in these regulations are provided for by OMB control number 1651-0034 (CBP Regulations Pertaining to Customs Brokers) and by OMB control number 1651-0076 (Recordkeeping Requirements). This rule does not change the burden under these information collections.

This regulation is being issued in accordance with 19 CFR 0.1(a)(1) pertaining to the Secretary of the Treasury's authority (or that of his delegate) to approve regulations related to certain customs revenue functions.

For the reasons set forth in the preamble, parts 24 and 111 of title 19 of the Code of Federal Regulations (19 CFR parts 24 and 111) are proposed to be amended as set forth below.

Invitation to Comment: We invite you to submit comments regarding the proposed requirements and definition. To ensure that your comments have maximum effect in developing the final requirements and definition, we urge you to identify clearly the specific section of the proposed requirements or definition that each comment addresses.

We invite you to assist us in complying with the specific requirements of Executive Orders 12866, 13563, and 13771 and their overall requirement of reducing regulatory burden that might result from these proposed requirements and definition. Please let us know of any further ways we could reduce potential costs or increase potential benefits while preserving the effective and efficient administration of the program.

1. We invite public comment on whether there are other specific issues the Department should consider when evaluating waiver proposals and whether we should require States, in their proposals, to provide further explanations of the legal and research-based supports for their proposals.

2. The Department's regulations implementing Section 504 of the Rehabilitation Act of 1973 (Section 504) and covering recipients that serve school-aged children with disabilities, as set out in 34 CFR 104.31 through 104.36, contain civil rights protections that often overlap with, or can be met through the implementation of, the protections in IDEA Part B. For example, implementation of an individualized education program (IEP) developed in accordance with IDEA Part B is one means of meeting the standard for an appropriate education under the Section 504 implementing regulations. See 34 CFR 104.33(b)(2). Likewise, the Section 504 implementing regulations require evaluations and reevaluations that meet certain criteria. 34 CFR 104.35(a), (b), and (d).

(a) Given the limitation that the Secretary may not waive any statutory or regulatory requirements of, or relating to, applicable civil rights requirements, the Department is seeking public comment on the best ways to address the close relationship between IDEA and the Section 504 protections that apply to school-aged children with disabilities.

(b) Because of the overlap between IDEA and Section 504, should States, in their waiver proposals, be required to include a specific explanation of why the waiver sought would not conflict with requirements of, or relating to, Section 504 and its implementing regulations?

3. We are particularly interested in comments regarding paragraphs (a)(6) and (a)(7) of the proposed requirements. These requirements originally appeared in the 2007 final requirement. (We discuss the 2007 final requirements in greater detail in the Background section of this notice.) However, we are interested in public comment on whether these paragraphs are sufficiently clear that parents have the right to understand and consent to changes that affect their children's education and do not imply that waivers of FAPE are permitted under this program.

During and after the comment period, you may inspect all public comments about the proposed requirements and definition by accessing Regulations.gov . You may also inspect the comments in person in room 5163, 550 12th Street SW, Potomac Center Plaza, Washington, DC, between the hours of 8:30 a.m. and 4:00 p.m., Eastern Time, Monday through Friday of each week except Federal holidays. Please contact the person listed under FOR FURTHER INFORMATION CONTACT .

Assistance to Individuals with Disabilities in Reviewing the Rulemaking Record: On request, we will provide an appropriate accommodation or auxiliary aid to an individual with a disability who needs assistance to review the comments or other documents in the public rulemaking record for the proposed requirements and definition. If you want to schedule an appointment for this type of accommodation or auxiliary aid, please contact the person listed under FOR FURTHER INFORMATION CONTACT .

Purpose of Program: The purpose of this program is to provide an opportunity for States to reduce excessive paperwork and noninstructional time burdens on special education teachers, related services providers, and State and local administrators, thus increasing time and resources available for instruction and other activities that would improve educational and functional results for children with disabilities.

The Secretary believes that all students should be given the opportunity to succeed and that their success should be the primary focus of everyone in the educational system. When teachers, related services providers, and administrators who serve children with disabilities spend time completing unnecessary paperwork, their ability to prioritize and focus on improving outcomes for children with disabilities is hampered.

In the 2004 reauthorization of IDEA, Congress recognized that some Federal IDEA Part B requirements could create excessive paperwork and noninstructional time burdens on special education teachers, related services providers, and State and local administrators, thus diverting time and resources away from instruction and other activities that would improve educational and functional results for children with disabilities.

As such, under section 609 of IDEA, Congress gave the Department limited authority to grant waivers of certain requirements of IDEA Part B. Waivers may be granted to not more than 15 States and for a period not to exceed 4 years. Further, the Secretary may not waive any statutory or regulatory provisions relating to applicable civil rights requirements or allow a State or local educational agency to waive procedural safeguards under section 615 of IDEA, and waivers may not affect the right of a child with a disability to receive a free appropriate public education (FAPE) under IDEA Part B. In short, States' waiver proposals must preserve the fundamental rights of children with disabilities under IDEA. 1 In addition, States have always had the authority, within the constraints of State law, to change or waive State requirements that exceed IDEA statutory and regulatory requirements in order to reduce administrative burden.

In this document, we are proposing requirements and a definition for States to apply for paperwork waivers under section 609 of IDEA and thereby increase the time and resources available for instruction and other activities aimed at improving educational and functional results for children with disabilities.

Elsewhere in this issue of the Federal Register , we are proposing priorities, requirements, and selection criteria for the IDEA Paperwork Reduction Planning and Implementation program, through which the Department intends to make grant funds available to plan for and implement reductions of excessive paperwork and noninstructional time burdens under IDEA section 609.

IDEA is silent with respect to the selection criteria the Department may use to evaluate State proposals. On October 12, 2007, through a notice published in the Federal Register , the Department solicited State proposals under what was then called the IDEA Paperwork Waiver Demonstration Program (72 FR 58066). At that time, the Department relied on a notice of final additional requirements and selection criteria published in the Federal Register on July 6, 2007 (72 FR 36970), which, in part, governed how States could apply for a waiver under IDEA section 609. However, that notice specified that the additional requirements and selection criteria were only eligible to be used once, which the Department did in 2007.

We are, therefore, again issuing a notice of proposed requirements and definition for waiver proposals. The Department is proposing to use many of the same requirements for the waivers as it did in 2007 because we believe they still represent a sensible and practical approach to implementating the statutory requirements in section 609 of IDEA. Specifically, paragraphs (a)(1) through (7) of these proposed requirements come from the 2007 notice. We invite public comment on the extent to which those requirements remain appropriate and whether the Department should include fewer, additional, or different requirements.

Further, section 609(a)(3) of IDEA establishes requirements for a State's waiver proposal. Paragraphs (a)(8) and (9) of the proposed requirements reflect those requirements. Consistent with IDEA sections 602(22), 602(31), and 610, “State” means each of the 50 States, the District of Columbia, the Commonwealth of Puerto Rico, each of the outlying areas (United States Virgin Islands, Guam, American Samoa, and the Commonwealth of the Northern Mariana Islands), and the freely associated States (the Republic of the Marshall Islands, the Federated States of Micronesia, and the Republic of Palau).

Finally, the Department is primarily interested in granting waiver proposals designed to produce the greatest benefits as measured by the number of burden hours reduced, the number of instructional hours gained, and the number of personnel and students with disabilities positively affected by the waivers. As a result, paragraphs (a)(10), (a)(11), (b), (c), (d), and (e) of the proposed requirements require States, in their waiver proposals, to include a discussion of (1) the interaction between the Federal IDEA Part B requirements they propose to waive and any related State requirements, (2) activities the State proposes to undertake to implement the proposed waiver, and (3) how the State will evaluate the effectiveness of the proposed waiver.

The Department intends to accept waiver proposals from States for 12 months following publication of an appropriate notice. The Department will review each proposal to determine whether the waivers are legally permissible and likely to generate the meaningful benefits contemplated in IDEA for personnel and the students with disabilities they serve.

Proposed Requirements: We propose the following requirements for a proposal to waive certain requirements of, or relating to, IDEA Part B under section 609. We may apply one or more of these requirements in any year in which this program is in effect.

(a) An applicant must include in its proposal the following:

(1) A description of how the State  2 met the public participation requirements of section 612(a)(19) of IDEA, including how the State—

(i) Involved multiple stakeholders, including parents, children with disabilities, special education and regular education teachers, related services providers, and school and district administrators, in selecting the requirements proposed for the waiver and any specific proposals for changing those requirements to reduce excessive paperwork; and

(ii) Provided an opportunity for public comment, including from individuals with disabilities and parents of children with disabilities, in selecting the requirements proposed for the waiver.

(iii) Held public hearings, and provided adequate notice of the hearings, to solicit input on the selection of requirements proposed for the waiver.

(2) A summary of public comments received in accordance with paragraph (a)(1) of these requirements and how the public comments were addressed in the proposal.

(3) A description of the procedures the State will employ to ensure that, if the waiver is granted, it will not result in a denial of FAPE to any child with a disability, infringe on any applicable civil rights requirements, or result in a waiver of any procedural safeguards under section 615 of IDEA. This description also must include an assurance that the State will collect and report to the Department, as part of the State's annual performance report to the Secretary in accordance with section 616(b)(2)(C)(ii)(II) of IDEA, all State complaints and due process hearings resulting from the waivers and related to the denial of FAPE to any child with a disability or a waiver of any procedural safeguards under section 615 of IDEA and how the State responded to this information, including the outcome of that response such as providing technical assistance to the local educational agency (LEA) to improve implementation, or suspending or terminating the authority of an LEA to waive paperwork requirements due to unresolved compliance problems.

(4) A description of the procedures the State will employ to ensure that diverse stakeholders (including parents, teachers, administrators, related services providers, and other stakeholders, as appropriate) understand the proposed elements of the State's submission for the IDEA Paperwork Reduction Waivers.

(5) Assurances that every parent of a child with a disability in participating LEAs will be given, in easily understandable language, written notice (in the native language of the parent, unless it is clearly not feasible to do so) of all statutory, regulatory, or State requirements that will be waived and the procedures that the State will employ under paragraph (a)(3) of these requirements.

(6) Assurances that the State will require any participating LEA to obtain voluntary informed written consent from parents for a waiver of any paperwork requirements related to the provision of FAPE.

(7) Assurances that the State will require any participating LEA to inform parents in writing (in the native language of the parents, unless it is clearly not feasible to do so) of—

(i) Any differences between the paperwork requirements under the waiver program approved for the State and the existing paperwork requirements of IDEA related to the provision of FAPE;

(ii) The parent's right to revoke consent to waive any paperwork requirements related to the provision of FAPE at any time; and

(iii) The LEA's responsibility to meet all paperwork requirements related to the provision of FAPE if the parent does not provide voluntary written informed consent or revokes consent.

(8) A list of any statutory requirements of, or regulatory requirements relating to, IDEA Part B that the State desires the Secretary to waive, in whole or in part. For each requirement, the State should discuss how waiving the requirement will—

(i) Reduce excessive paperwork and noninstructional time burdens on special education teachers, related services providers, and State and local administrators;

(ii) Not affect the right of a child with a disability to receive FAPE under IDEA Part B, infringe on any applicable civil rights requirements, or result in the waiver of any procedural safeguards under section 615 of IDEA.

(9) A list of any State requirements that the State proposes to waive or change, in whole or in part, to carry out a waiver granted to the State by the Secretary.

(10) A description of the interplay between the requirements described in paragraph (a)(8) and any State requirements including, but not limited to, those described in paragraph (a)(9).

(11) A description of the anticipated benefits of the proposed waiver, including, but not limited to—

(i) The total reduction in burden hours on State and local personnel and the total number of instructional hours gained, disaggregated by applicable statutory or regulatory provision;

(ii) The total number of administrators and direct service providers affected, including the number of individuals in each group, disaggregated by applicable statutory or regulatory provision; and

(iii) The total number of likely beneficiaries, and the magnitude and scope of anticipated benefits and other activities intended to improve educational and functional results for children with disabilities.

(12) A State that received a planning grant under the IDEA Paperwork Reduction Planning and Implementation Program (84.326F) must include in its waiver proposal the plan the State developed under that program.

(b) An applicant must include in its proposal its proposed plan to disseminate information and materials regarding any revisions to requirements, policies, procedures, or practices made in conjunction with the waiver to relevant stakeholders, including, but not limited to, LEAs; private schools (including parochial schools) that provide services to children with disabilities; charter management organizations; the State Advisory Panel, as defined in section 612(a)(21) of IDEA; and parent organizations, as that term is defined in sections 671(a)(2) and 672(a)(2) of IDEA.

(c) An applicant must assure that it will make publicly available all information regarding changes to requirements, policies, procedures, or practices made in conjunction with the waiver.

(d) An applicant must include in its proposal its proposed plan to provide training on revisions to requirements, policies, procedures, or practices made under the waiver to staff in LEAs, private schools (including parochial schools) that provide services to children with disabilities, and other appropriate service providers and administrators.

(e) An applicant must include in its proposal its proposed plan to collect and analyze data on specific and measurable goals, objectives, and outcomes of the project related to the implementation of any waiver granted, including data on the effectiveness of the waiver in—

(1) Reducing—

(i) The paperwork burden on teachers, principals, administrators, and related services providers; and

(ii) Noninstructional time spent by teachers in complying with IDEA Part B;

(2) Enhancing longer-term educational planning;

(3) Improving positive outcomes, including educational and functional results, for children with disabilities;

(4) Promoting collaboration between IEP Team members; and

(5) Ensuring satisfaction of family members.

(f) An applicant must submit its proposal with a letter signed by an appropriate State official, or his or her designee, stating that—

(1) The appropriate State official is authorized to make the proposal for a waiver under State law; and

(2) The proposal meets all of the applicable requirements for a waiver.

We propose the following definition for the proposed requirements. We may apply this definition in any year in which the requirements are in effect.

“Applicable civil rights requirements,” includes, but is not limited to, the civil rights protections in the United States Constitution and the requirements in the following legislation and their respective implementing regulations:

(1) Section 504 of the Rehabilitation Act of 1973, as amended.

(2) Title VI of the Civil Rights Act of 1964.

(3) Title IX of the Education Amendments of 1972.

(4) Title II of the Americans with Disabilities Act of 1990.

(5) Age Discrimination Act of 1975.

We will announce the final requirements and definition in a document in the Federal Register . We will determine the final requirements and definition after considering public comments on the proposed requirements and definition and other information available to the Department. This document does not preclude us from proposing priorities, additional requirements, additional definitions, or selection criteria subject to meeting applicable rulemaking requirements.

Under Executive Order 12866, the Office of Management and Budget (OMB) determines whether this regulatory action is “significant” and, therefore, subject to the requirements of the Executive order and subject to review by OMB. Section 3(f) of Executive Order 12866 defines a “significant regulatory action” as an action likely to result in a rule that may—

(1) Have an annual effect on the economy of $100 million or more, or adversely affect a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or Tribal governments or communities in a material way (also referred to as an “economically significant” rule);

(2) Create serious inconsistency or otherwise interfere with an action taken or planned by another agency;

(3) Materially alter the budgetary impacts of entitlement 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 stated in the Executive order.

OMB has determined that this proposed regulatory action is not a significant regulatory action subject to review by OMB under section 3(f) of Executive Order 12866.

Under Executive Order 13771, for each new rule that the Department proposes for notice and comment or otherwise promulgates that is a significant regulatory action under Executive Order 12866, and that imposes total costs greater than zero, it must identify two deregulatory actions. For FY 2020, any new incremental costs associated with a new regulation must be fully offset by the elimination of existing costs through deregulatory actions. Because the proposed regulatory action is not significant, the requirements of Executive Order 13771 do not apply.

We have also reviewed this proposed regulatory action under Executive Order 13563, which supplements and explicitly reaffirms the principles, structures, and definitions governing regulatory review established in Executive Order 12866. To the extent permitted by law, Executive Order 13563 requires that an agency—

(1) Propose or adopt regulations only upon a reasoned determination that their benefits justify their costs (recognizing that some benefits and costs are difficult to quantify);

(2) Tailor its regulations to impose the least burden on society, consistent with obtaining regulatory objectives and taking into account—among other things and to the extent practicable—the costs of cumulative regulations;

(3) In choosing among alternative regulatory approaches, select those approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity);

(4) To the extent feasible, specify performance objectives, rather than the behavior or manner of compliance a regulated entity must adopt; and

(5) Identify and assess available alternatives to direct regulation, including economic incentives—such as user fees or marketable permits—to encourage the desired behavior, or provide information that enables the public to make choices.

Executive Order 13563 also requires an agency “to use the best available techniques to quantify anticipated present and future benefits and costs as accurately as possible.” The Office of Information and Regulatory Affairs of OMB has emphasized that these techniques may include “identifying changing future compliance costs that might result from technological innovation or anticipated behavioral changes.”

We are issuing the proposed requirements and definition based on a reasoned determination that the benefits would justify the costs. In choosing among alternative regulatory approaches, we selected those approaches that would maximize net benefits. Based on the analysis that follows, the Department believes that this regulatory action is consistent with the principles in Executive Order 13563.

We also have determined that this regulatory action would not unduly interfere with State, local, and Tribal governments in the exercise of their governmental functions.

In accordance with both Executive orders, the Department has assessed the potential costs and benefits, both quantitative and qualitative, of this regulatory action. The potential costs are those resulting from statutory requirements and those we have determined as necessary for administering the Department's programs and activities. These potential costs are those that would be incurred by a State making an application for a waiver to the Secretary following the requirements proposed by this regulatory action.

In addition, we have considered the potential benefits of this regulatory action and have noted these benefits in the background section of this document. The potential benefits include a reduction in the administrative burden hours under IDEA on State and local personnel and a corresponding gain in instructional time and services for children with disabilities.

The proposed requirements contain information collection requirements that are approved by OMB under OMB control number 1820-0028; the proposed requirements do not affect the currently approved data collection.

Executive Order 12866 and the Presidential memorandum “Plain Language in Government Writing” require each agency to write regulations that are easy to understand.

The Secretary invites comments on how to make these proposed requirements and definition easier to understand, including answers to questions such as the following:

• Are the requirements in the proposed regulations clearly stated?

• Do the proposed regulations contain technical terms or other wording that interferes with their clarity?

• Does the format of the proposed regulations (grouping and order of sections, use of headings, paragraphing, etc.) aid or reduce their clarity?

• Would the proposed regulations be easier to understand if we divided them into more (but shorter) sections?

• Could the description of the proposed regulations in the SUPPLEMENTARY INFORMATION section of this preamble be more helpful in making the proposed regulations easier to understand? If so, how?

• What else could we do to make the proposed regulations easier to understand?

To send any comments that concern how the Department could make these proposed regulations easier to understand, see the instructions in the ADDRESSES section.

Regulatory Flexibility Act (RFA) Certification: The Secretary certifies that this proposed regulatory action would not have a significant economic impact on a substantial number of small entities. The U.S. Small Business Administration (SBA) Size Standards define “small entities” as for-profit or nonprofit institutions with total annual revenue below $7,000,000 or, if they are institutions controlled by small governmental jurisdictions (that are comprised of cities, counties, towns, townships, villages, school districts, or special districts), with a population of less than 50,000.

The proposed requirements and definition would not affect any small entities, as only States, as defined in the IDEA, are eligible to apply. No States qualify as small entities for purposes of the RFA.

Intergovernmental Review: This program is subject to Executive Order 12372 and the regulations in 34 CFR part 79. One of the objectives of the Executive order is to foster an intergovernmental partnership and a strengthened federalism. The Executive order relies on processes developed by State and local governments for coordination and review of proposed Federal financial assistance.

This document provides early notification of our specific plans and actions for this program.

Accessible Format: Individuals with disabilities can obtain this document in an accessible format ( e.g., braille, large print, audiotape, or compact disc) on request to the program contact person listed under FOR FURTHER INFORMATION CONTACT .

Electronic Access to This Document: The official version of this document is the document published in the Federal Register . You may access the official edition of the Federal Register and the Code of Federal Regulations at www.govinfo.gov. At this site you can view this document, as well as all other documents of this Department published in the Federal Register , in text or Portable Document Format (PDF). To use PDF you must have Adobe Acrobat Reader, which is available free at the site.

You may also access documents of the Department published in the Federal Register by using the article search feature at www.federalregister.gov. Specifically, through the advanced search feature at this site, you can limit your search to documents published by the Department.

Throughout this document wherever “we,” “us,” or “our” is used, we mean the EPA.

On May 8, 2019, the State of Colorado submitted a SIP revision containing amendments to 5 CCR 1001-5, Regulation Number 3 (Stationary Source Permitting and Air Pollution Emission Notice Requirements). Specifically, these amendments revised Part A, VI.C. (Annual Emissions Fees) and VI.D. (Fee Schedule). These revisions are anticipated to cover revenue shortfalls and ensure continued program viability by increasing stationary source fees. The State of Colorado adopted these revisions on October 18, 2018, and they became State effective on November 30, 2018. We are proposing approval of all revisions submitted on May 8, 2019.

We evaluated the State's May 8, 2019, submittal regarding revisions Regulation Number 3, Part A, Section VI.

A reference to Section VI.D.1 is being revised to VI.D.3 to coincide with revisions to VI.D.

For air pollution emission notice filing fees, the phrase “. . . shall be charged in accordance with and in the amounts and limits specified in the provisions of Colorado Revised Statutes Section 25-7-114.1” is being deleted and new phrase “shall be $191.13” is being added.

We note that Colorado Revised Statutes Section 25-7-114.1 states:

“The maximum fee for filing an air pollution emission notice or amendment thereto under this section is one hundred ninety-one dollars and thirteen cents; except that, on each January 1 from 2019 to 2028, the maximum fee is automatically adjusted based on the annual percentage change in the United States department of labor, bureau of labor statistics, consumer price index for Denver-Aurora-Lakewood for all items and all urban consumers, or its successor index. The commissioner shall set the actual fee by rule. Beginning on July 1, 2018, the commission, by rule, may periodically adjust the fee up to the maximum fee.”

The revision to VI.D.1 would make the maximum fee ($191.13) the only filing fee for air pollution emission notices.

The new sentence “Permit processing fees shall be $95.56 per hour” is added.

The phrase “Annual emission fees and permit processing fees shall be charged in accordance with and in the amounts and limits specified in the provisions of Colorado Revised Statutes Section 25-7-114.7.” is being deleted.

In addition, the phrase “Annual emission fees for regulated pollutants shall be $22.90 per ton” is being revised to state: “Annual emission fees for regulated pollutants shall be $28.63 per ton”; and the phrase “Annual emission fees for hazardous air pollutants shall be $152.90 per ton” is being revised to state: “Annual emission fees for hazardous air pollutants shall be $191.13 per ton.”

The new annual emission fees for regulated pollutants and hazardous air pollutants are the same as the maximum emission fees as stated in Colorado Revised Statutes Section 25-7-114.7.

CAA Section 110(a)(2)(E) requires that a state implementation plan provide assurances that the state will have, among other items, adequate funding to carry out the implementation plan. Increasing the air pollution notice filing fee, permit processing fee and annual emission fees reflect both inflation and the increased complexity of permit to construct applications, thereby ensuring the State has adequate funding to carry out the implementation plan.

In this action, the EPA is proposing to approve SIP amendments to Colorado's Regulation Number 3, shown in Table 1, submitted by the State of Colorado on May 8, 2019.

Under section 110(l) of the CAA, the EPA cannot approve a SIP revision if the revision would interfere with any applicable requirements concerning attainment and reasonable further progress (RFP) toward attainment of the NAAQS, or any other applicable requirement of the Act. In addition, section 110(l) requires that each revision to an implementation plan submitted by a state shall be adopted by the state after reasonable notice and public hearing.

The Colorado SIP revisions that the EPA proposes to approve do not interfere with any applicable requirements of the Act. Therefore, CAA section 110(l) requirements are satisfied.

In this rule, the EPA is proposing to include in a final EPA rule regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, the EPA is proposing to incorporate by reference the amendments described in sections II and III. The EPA has made, and will continue to make, these materials generally available through www.regulations.gov and at the EPA Region 8 Office (please contact the person identified in the FOR FURTHER INFORMATION CONTACT section of this preamble for more information).

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, the EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely proposes to approve state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this 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, 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 proposed 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).

I. Background

DoD, GSA, and NASA are proposing to revise the FAR to implement statutory and regulatory changes made by the Small Business Administration (SBA) regarding joint ventures. These changes allow a joint venture comprised of a protégé and its mentor to qualify as a small business or under a socioeconomic program ( e.g., 8(a)) for which the protégé qualifies. These changes also provide updated requirements for other joint ventures to qualify as a small business or under a socioeconomic program.

Section 1347 of the Small Business Jobs Act of 2010 (Pub. L. 111-240) and section 1641 of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2013 (Pub. L. 112-239; 15 U.S.C. 657r) authorized the SBA Administrator to establish mentor-protégé programs for small business concerns, service-disabled veteran-owned small business (SDVOSB) concerns, women-owned small business concerns in the Women-Owned Small Business (WOSB) Program, and HUBZone small business concerns modeled on the mentor-protégé program under section 8(a) of the Small Business Act (15 U.S.C. 637(a)). On July 25, 2016, SBA issued a final rule (81 FR 48558) that implemented the mentor-protégé programs at 13 CFR 125.9. SBA's final rule allows a joint venture comprised of a protégé and its mentor to seek any type of small business contract, including under a socioeconomic program, for which the protégé qualifies.

SBA's final rule updated requirements for a joint venture to qualify as a small business concern or under a socioeconomic program. A joint venture qualifies as a small business concern when each of the parties to the joint venture qualifies as small for the size standard associated with the North American Industry Classification System (NAICS) code in the solicitation. A joint venture may qualify under a socioeconomic program when at least one party to the joint venture qualifies under a socioeconomic program, and the joint venture meets the applicable joint venture requirements specified in the SBA regulations.

SBA's final rule also revised the joint venture regulations at 13 CFR 124.513 for 8(a) participants, 125.18(b) for SDVOSBs; 126.616 for HUBZone small business concerns; and 127.506 for WOSB and economically disadvantaged WOSB concerns. SBA required agencies to consider past performance of each party to a small business joint venture in addition to any work performed by the joint venture itself.

DoD, GSA, and NASA are proposing to amend the FAR to require contracting officers to consider the past performance of the joint venture, and to consider the past performance of each party to the joint venture if the joint venture does not demonstrate past performance. For consistency and fairness, DoD, GSA, and NASA are proposing to amend the FAR to apply this requirement to joint ventures regardless of size status.

Additionally, DoD, GSA, and NASA are proposing to amend the FAR to clarify that 8(a) joint ventures are not certified into the 8(a) program and that 8(a) joint venture agreements need only be approved by the SBA prior to contract award. This clarification is necessary because Government Accountability Office (GAO) sustained a protest (BGI-Fiore JV, LLC, B-409520, May 29, 2014) in which an agency rejected an 8(a) joint venture's proposal on the basis that the 8(a) joint venture had not been certified by the SBA prior to submission of proposals. Currently, paragraph (a) of the clause at FAR 52.219-18, Notification of Competition Limited to Eligible 8(a) Concerns, states that, “Offers are solicited only from small business concerns expressly certified by the Small Business Administration (SBA) for participation in the SBA's 8(a) program and which meet the following criteria at the time of submission of offer . . . .” This language could be interpreted to mean that 8(a) joint ventures that submit an offer for an 8(a) contract need to be “certified” by the SBA and that their joint venture agreement needs to be approved by the SBA by “the time of submission of offer.” This rule proposes clarifications to prevent the improper elimination of 8(a) joint venture proposals in the future.

The proposed changes to the FAR are summarized in the following paragraphs.

A. Definition of “small business concern.” The definition of “small business concern” is revised in subpart 2.1, as well as in the following provisions and clauses: FAR 52.212-3, Offeror Representations and Certification—Commercial Items; FAR 52.219-1, Small Business Program Representations; FAR 52.219-8, Utilization of Small Business Concerns; and FAR 52.219-28, Post-Award Small Business Program Rerepresentation. This revision removes extraneous material concerning how to determine whether a small business concern is “not dominant in its field of operation.” That determination is made by SBA and is addressed in SBA regulations at 13 CFR 121.102(b).

B. Consideration of past performance of parties to a joint venture. This rule clarifies that the contracting officer shall consider the past performance of the joint venture. If the joint venture does not demonstrate past performance for award, the contracting officer shall consider the past performance of each party to the joint venture when making a responsibility determination and when past performance is an evaluation factor for source selection. This clarification is made in subpart 9.1, Responsible Prospective Contractors, and in subpart 15.3, Source Selection.

C. Qualification of joint ventures as small business concerns. Subpart 19.3, Determination of Small Business Status for Small Business Programs, is amended to address how a joint venture may qualify for an award as a small business concern or under the socioeconomic programs. A joint venture may qualify as a small business concern if each participant in the joint venture qualifies as small under the size standard for the solicitation; or the protégé is small under the size standard for the solicitation in a joint venture comprised of a mentor and protégé with an approved agreement under a SBA mentor-protégé program. A joint venture may qualify under socioeconomic programs when the joint venture qualifies as a small business joint venture and one of the parties to the joint venture qualifies under one or more of the socioeconomic programs. Similar text is added to subparts 19.13, Historically Underutilized Business Zone (HUBZone) Program; 19.14, Service-Disabled Veteran-Owned Small Business Procurement Program; and 19.15, Women-Owned Small Business Program. Similar text is also added to the following provisions and clauses: FAR 52.212-3, Offeror Representations and Certifications—Commercial Items; FAR 52.219-1, Small Business Program Representations; FAR 52.219-8, Utilization of Small Business Concerns; FAR 52.219-18, Notification of Competition Limited to Eligible 8(a) Participants; FAR 52.219-27, Notice of Service-Disabled Veteran-Owned Small Business Set-Aside; FAR 52.219-29, Notice of Set-Aside for, or Sole Source Award to, Economically Disadvantaged Women-Owned Small Business Concerns; and FAR 52.219-30, Notice of Set-Aside for, or Sole Source Award to, Women-Owned Small Business Concerns Eligible Under the Women-Owned Small Business Program.

D. Subpart 19.7, The Small Business Subcontracting Program. This subpart is amended to remove instructions for contractors that already exist in the clause at FAR 52.219-8, Utilization of Small Business Concerns.

E. Subpart 19.8, Contracting with the Small Business Administration (the 8(a) Program). This subpart is amended to add language to FAR sections 19.804-3, SBA acceptance, and 19.805-2, Procedures, to clarify that at least one party to the joint venture must be certified as an 8(a) program participant at the time of proposal submission and that the 8(a) joint venture agreement shall be approved prior to contract award. In addition, pursuant to 13 CFR 124.503 and 13 CFR 124.507, language is added to clarify the general time period within which SBA expects to approve the joint venture agreement prior to award and the procedure to follow if a response is not received within that time period. The rule also proposes to delete text from 19.805-2(b) relating to how SBA determines eligibility because it creates confusion regarding the timing of SBA's determination.

F. Performance requirement for certain joint ventures. This rule proposes to amend the following contract clauses to add the requirement that certain small business or socioeconomic parties to a joint venture perform 40 percent of the work performed by the joint venture and that the work performed must be more than administrative functions: FAR 52.219-3, Notice of HUBZone Set-Aside or Sole Source Award; FAR 52.219-4, Notice of Price Evaluation Preference for HUBZone Small Business Concerns; FAR 52.219-14, Limitations on Subcontracting; FAR 52.219-27, Notice of Service-Disabled Veteran-Owned Small Business Set-Aside; FAR 52.219-29, Notice of Set-Aside for, or Sole Source Award to, Economically Disadvantaged Women-Owned Small Business Concerns; and FAR 52.219-30, Notice of Set-Aside for, or Sole Source Award to, Women-Owned Small Business Concerns Eligible Under the Women-Owned Small Business Program.

This rule proposes to amend subparts 2.1, Definitions, 9.1, Responsible Prospective Contractors, and 15.3, Source Selection; multiple subparts of part 19, Small Business Programs; and multiple provisions and clauses related to small business programs. The objective of this rule is to update the FAR to align with SBA regulations regarding joint ventures and to provide clarifications for 8(a) joint ventures.

The Federal Acquisition Regulatory (FAR) Council has made the following preliminary determinations with respect to the proposed rule's application of section 1641 of the NDAA for FY 2013 to contracts at or below the simplified acquisition threshold (SAT) and for the acquisition of commercial items. The Administrator for Federal Procurement Policy has made the following preliminary determination with respect to commercially available off-the-shelf (COTS) items. Discussion of these preliminary determinations is set forth below. The FAR Council will consider public feedback before making a final determination on the scope of the final rule.

Pursuant to 41 U.S.C. 1905, a provision of law is not applicable to acquisitions at or below the SAT unless the law (i) contains criminal or civil penalties; (ii) specifically refers to 41 U.S.C. 1905 and states that the law applies to acquisitions at or below the SAT; or (iii) the FAR Council makes a written determination that it is not in the best interest of the Federal Government to exempt contracts or subcontracts at or below the SAT. If none of these conditions are met, the FAR is required to include the statutory requirement(s) on a list of provisions of law that are inapplicable to acquisitions at or below the SAT.

The purpose of this rule is to implement section 1641 of the NDAA for FY 2013. Section 1641 authorized the SBA Administrator to establish mentor-protégé programs for small business concerns, SDVOSB concerns, WOSB concerns in the WOSB Program, and HUBZone small business concerns modeled on the mentor-protégé program under section 8(a) of the Small Business Act (15 U.S.C. 637(a)).

These statutory requirements are reflected in SBA's final rule published in the Federal Register at 81 FR 48558, on July 25, 2016, which did not exempt acquisitions at or below the SAT.

The law is silent on the applicability of these requirements to acquisitions at or below the SAT and does not independently provide for criminal or civil penalties; nor does it include terms making express reference to 41 U.S.C. 1905 and its application to acquisitions at or below the SAT. Therefore, it does not apply to acquisitions at or below the SAT unless the FAR Council makes a written determination as provided at 41 U.S.C. 1905.

Application of the law to acquisitions at or below the SAT will ensure that the benefits from socioeconomic set-aside and sole source contracts flow to the intended parties. According to the Federal Procurement Data System, an average of 283,374 contracts per year resulted from FAR part 19 set-asides and sole-source awards at or below the simplified acquisition threshold during fiscal years 2016-2018. Not applying section 1641 to the maximum extent possible would exclude a significant number of acquisitions and impede the Administration's objectives to assist small businesses, including SDVOSB, HUBZone small business, and WOSB concerns, to succeed in enhancing their capabilities and improving their ability to successfully compete for both Government and commercial contracts.

The provisions and clauses proposed for revision in this rule currently apply to all solicitations and contracts, as applicable, including those at or below the SAT. The proposed rule continues the existing applicability to solicitations and contracts below the SAT, while revising these clauses to implement the requirements of section 1641 concerning joint ventures. Exclusion of these acquisitions would create confusion among contractors and the Federal contracting workforce. Under the FAR clauses amended by this rule, contractors are already required to comply with small business program set-aside requirements. The effort required for contractors to comply with the new requirements will be relatively small.

For these reasons, it is in the best interest of the Federal Government to apply the requirements of the rule to acquisitions at or below the SAT.

Pursuant to 41 U.S.C. 1906, acquisitions of commercial items (other than acquisitions of COTS items, which are addressed in 41 U.S.C. 1907) are exempt from a provision of law unless the law (i) contains criminal or civil penalties; (ii) specifically refers to 41 U.S.C. 1906 and states that the law applies to acquisitions of commercial items; or (iii) the FAR Council makes a written determination and finding that it would not be in the best interest of the Federal Government to exempt contracts for the procurement of commercial items from the provision of law. If none of these conditions are met, the FAR is required to include the statutory requirement(s) on a list of provisions of law that are inapplicable to acquisitions of commercial items.

The purpose of this rule is to implement section 1641 of the NDAA for FY 2013. Section 1641 allows a joint venture comprised of a protégé and its mentor to qualify as a small business or under a socioeconomic program for which the protégé qualifies and implements SBA regulations establishing mentor-protégé programs for small business concerns, SDVOSB concerns, WOSB concerns in the WOSB Program, and HUBZone small business concerns modeled on the mentor-protégé program under section 8(a) of the Small Business Act (15 U.S.C. 637(a)).

These statutory requirements are reflected in SBA's final rule published in the Federal Register at 81 FR 48558, on July 25, 2016, which did not exempt acquisitions of commercial items.

The law is silent on the applicability of these requirements to acquisitions of commercial items and does not independently provide for criminal or civil penalties; nor does it include terms making express reference to 41 U.S.C. 1906 and its application to acquisitions of commercial items. Therefore, it does not apply to acquisitions of commercial items unless the FAR Council makes a written determination as provided at 41 U.S.C. 1906.

The law furthers the Administration's goal of supporting small business. It advances the interests of small business concerns by allowing for more joint ventures that include a small business to qualify as a small business or under a socioeconomic program. Therefore, more small businesses can qualify for set-aside procurements. Exclusion of a large segment of Federal contracting, such as acquisitions for commercial items, will limit the full implementation of these objectives.

The provisions and clauses proposed for revision in this rule currently apply to all solicitations and contracts, as applicable, including those for acquisition of commercial items. The proposed rule continues the existing applicability to the acquisition of commercial items as defined at FAR 2.101. Exclusion of acquisitions for commercial items from these requirements would create confusion among contractors and the Federal contracting workforce. Under the FAR clauses amended by this rule, contractors are already required to comply with small business program set-aside requirements. The effort required for contractors to comply with the new requirements will be relatively small.

For these reasons, it is in the best interest of the Federal Government to apply the requirements of the rule to the acquisition of commercial items.

Pursuant to 41 U.S.C. 1907, acquisitions of COTS items will be exempt from a provision of law unless the law (i) contains criminal or civil penalties; (ii) specifically refers to 41 U.S.C. 1907 and states that the law applies to acquisitions of COTS items; (iii) concerns authorities or responsibilities under the Small Business Act (15 U.S.C. 644) or bid protest procedures developed under the authority of 31 U.S.C. 3551 et seq., 10 U.S.C. 2305(e) and (f), or 41 U.S.C. 3706 and 3707; or (iv) the Administrator for Federal Procurement Policy makes a written determination and finding that it would not be in the best interest of the Federal Government to exempt contracts for the procurement of COTS items from the provision of law. If none of these conditions are met, the FAR is required to include the statutory requirement(s) on a list of provisions of law that are inapplicable to acquisitions of COTS items.

The purpose of this rule is to implement section 1641 of the NDAA for FY 2013. Section 1641 allows a joint venture comprised of a protégé and its mentor to qualify as a small business or under a socioeconomic program for which the protégé qualifies, and implements SBA regulations establishing mentor-protégé programs for small business concerns, SDVOSB concerns, WOSB concerns in the WOSB Program, and HUBZone small business concerns modeled on the mentor-protégé program under section 8(a) of the Small Business Act (15 U.S.C. 637(a)).

These statutory requirements are reflected in SBA's final rule published in the Federal Register at 81 FR 48558, on July 25, 2016, which did not exempt acquisitions of COTS items.

The law is silent on the applicability of these requirements to acquisitions of COTS items and does not independently provide for criminal or civil penalties; nor does it include terms making express reference to 41 U.S.C. 1907 and its application to acquisitions of COTS items. Therefore, it does not apply to acquisitions of COTS items unless the Administrator for Federal Procurement Policy makes a written determination as provided at 41 U.S.C. 1907.

Section 1641 furthers the Administration's goal of supporting small business. It advances the interests of small business concerns by allowing for more joint ventures that include a small business to qualify as a small business concern or under a socioeconomic program. Therefore, more small businesses can qualify for set-aside procurements. Exclusion of a large segment of Federal contracting, such as acquisitions for COTS items, will limit the full implementation of these objectives.

The provisions and clauses proposed for revision in this rule currently apply to all solicitations and contracts, as applicable, including those for acquisition of COTS items. The proposed rule continues the existing applicability to the acquisition of COTS items as defined at FAR 2.101. Exclusion of these acquisitions would create confusion among contractors and the Federal contracting workforce. Under the FAR clauses amended by this rule, contractors are already required to comply with small business program set-aside requirements. The effort required for contractors to comply with the new requirements will be relatively small.

For these reasons, it is in the best interest of the Federal Government to apply the requirements of the rule to the acquisition of COTS items.

Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.

This rule is not expected to be subject to E.O. 13771, because this rule is not a significant regulatory action under E.O. 12866.

This proposed rule may have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601 et seq. The Initial Regulatory Flexibility Analysis (IRFA) is summarized as follows:

The Regulatory Secretariat Division has submitted a copy of the IRFA to the Chief Counsel for Advocacy of the SBA. A copy of the IRFA may be obtained from the Regulatory Secretariat Division. DoD, GSA, and NASA invite comments from small business concerns and other interested parties on the expected impact of this rule on small entities.

DoD, GSA, and NASA will also consider comments from small entities concerning the existing regulations in subparts affected by this rule in accordance with 5 U.S.C. 610. Interested parties must submit comments separately and should cite 5 U.S.C. 610 (FAR case 2017-019) in correspondence.

The Paperwork Reduction Act (44 U.S.C. chapter 35) applies as this proposed rule contains information collection requirements. This rule affects the certification and information collection requirements in the provisions at FAR 52.212-3, Offeror Representations and Certifications—Commercial Items, and 52.204-7, System for Award Management, currently approved under OMB Control Numbers 9000-0136 and 9000-0097, respectively. The impact, however, is negligible because the public reporting burden for these collections remains unchanged from the approved burden.

Therefore, DoD, GSA, and NASA propose amending 48 CFR parts 2, 9, 15, 19, and 52 as set forth below:

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I. Background

Under Defense Federal Acquisition Regulation System (DFARS) case 2012-D051, DoD published a proposed rule in the Federal Register at 79 FR 32522 on June 5, 2014, to implement section 807 of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2008 (10 U.S.C. 2330a). Section 807 required DoD to: Establish a data collection system that provides certain data on the purchasing of services by DoD, and submit to Congress an annual inventory of service contracts awarded by or on behalf of the DoD. The proposed rule required contractors to enter the contract data required by the statute into a DoD-unique database, Enterprise Contractor Manpower Reporting Application (ECMRA). Fourteen respondents submitted comments in response to the proposed rule.

Subsequently, section 812 of the NDAA for FY 2017 amended 10 U.S.C. 2330a to narrow the scope of contracts to which the data collection requirement applies. As a result, DFARS Case 2012-D051 was closed and rolled into this new DFARS case to implement 10 U.S.C. 2330a, as amended.

Under a similar but different statute, Federal agencies, other than DoD, are required by Federal Acquisition Regulation (FAR) subpart 4.17 to report annually on activities performed by service contractors. Since the publication of the proposed rule DFARS case 2012-D051, DoD has elected to adopt the approach used by other Federal agencies to collect service contract data. The approach uses the Federal Procurement Data System (FPDS), an existing source of contract information for the Federal Government, to provide a majority of the information required by 10 U.S.C. 2330a. The data that is not available in FPDS is entered annually by the contractor in the System for Award Management (SAM). Adopting a Governmentwide approach to collecting service contract data reduces burden on both industry and DoD, improves data integrity and accuracy, and reforms DoD's business practices for greater performance and affordability.

This rule proposes to revise the DFARS to implement 10 U.S.C. 2330a, as amended by section 812 of the NDAA for FY 2017. This rule will require contractors to report data in SAM on an annual basis when they are awarded a DoD contract or task order that is valued in excess of $3 million and is for logistics management services, equipment related services, knowledge-based services, or electronics and communications services.

When applicable, contractors will be required to annually report: (1) The total dollar amount invoiced for, and (2) the total number of direct labor hours expended on services performed under the contract or task order during the preceding fiscal year. The total number of direct labor hours reported to SAM should be the total of both the contractor hours and its subcontractors' hours. A new basic DFARS clause and an alternate I clause have been created to advise applicable contractors of the policy and requirements for reporting data in SAM.

DoD reviewed the public comments received in response to DFARS Case 2012-D051. A discussion of the comments is provided as follows:

Comment: Several respondents recommended that the rule exempt certain areas including: Research and development projects; architect and engineering services; telecommunications and transmission and internet; and actions using criteria similar to the Service Contract Labor Standards exemptions in FAR 22.1003-4(d)(1).

Response: This rule implements 10 U.S.C. 2330a, as amended by section 812 of the NDAA for FY 2017, which requires reporting for only four service acquisition portfolio groups: Logistics management services, equipment related services, knowledge-based services, and electronics and communications services. No further exemptions are available under the law.

Comment: Several respondents recommended that contracted services that meet the definition of commercial items be exempt from ECMRA reporting.

Response: The intent of the statute is to enhance DoD's ability to manage the total force, inclusive of military, civilian, and contractor personnel. Specifically, section 2330a requires the military departments and defense agencies to ensure that the inventory of contracts for services required by the statute is used to inform strategic workforce planning decisions under 10 U.S.C. 129a, develop budget justification materials for services in accordance with 10 U.S.C. 235, and ensure services contracts are not for the performance of inherently governmental functions. An exception for services that meet the definition of a commercial item would exclude significant sums expended by DoD on commercial service acquisitions intended to be covered by the law. Therefore, services meeting the definition of a commercial item are not exempt from the reporting requirement.

Comment: Several respondents recommended that firm fixed-price service contracts be exempt from the ECMRA reporting requirement, because these contracts acquire services in their entirety, not as individuals (full-time equivalents).

Response: In accordance with paragraph (b) of 10 U.S.C. 2330a, the data required to be collected under the statute includes service contracts and orders that contain firm fixed-prices for the specific tasks to be performed. Therefore, firm fixed-price contracts for the applicable services are not exempt under the proposed rule.

Comment: One respondent recommended that the rule exempt DoD intelligence community agency contracts, because the existing exemption for “classified services” is not sufficient to cover the exempt contracts entered into by DoD intelligence community agencies.

Response: The statute does not provide for exemptions to the reporting requirement; therefore, the proposed rule does not provide for exemptions, in order to comply with the law.

Comment: One respondent recommended that, due to the difficulty in tracking labor for service contracts where contractor employees may spend only small fractions of their time servicing the Government contract (such as refuse collection and software as a service), the rule should be changed to exempt such contracts by using the criteria similar to the Service Contract Labor Standards exemptions (see FAR 22.1003-4(d)(1)).

Response: Title 10 U.S.C. 2330a, as amended by section 812 of the NDAA for FY 2017, now limits data collection to four service acquisition portfolio groups: Logistics management services, equipment related services, knowledge-based services, and electronics and communications services. Under this proposed rule, only service contracts with a total estimated value exceeding $3 million that are for services in one of the four portfolio groups must be reported in SAM.

Comment: One respondent questioned whether Congress intended DoD to report contracts for services that are integrally related to supplies, or contracts where the services are a relatively small dollar value in relation to the supplies.

Response: Title 10 U.S.C. 2330a requires the collection of data on “each purchase of services by a military department or Defense Agency” that meets a certain dollar threshold and is for certain services. The proposed rule clarifies that the requirement applies to contracts or orders that have a total estimated value, including options, exceeding $3 million and are for services in one of the four service acquisition portfolio groups.

Comment: Two respondents suggested that the ECMRA reporting requirement be extended to contracts for services valued at or below the simplified acquisition threshold (SAT). Doing so would be consistent with the congressional intent in 10 U.S.C. 2330a for DoD to provide a total inventory of contracted for services.

Response: Title 10 U.S.C. 2330a(a), as amended by section 812 of the NDAA for FY 2017, now only requires the collection of data on service contracts, under certain portfolio groups, that exceed $3 million. This proposed rule implements the statutory threshold. Applying the rule to service contracts below $3 million is not necessary to implement the statute and would impose an unnecessary burden on the public and DoD.

Comment: One respondent suggested that the final rule clarify that services provided ancillary to a lease or rental contract (such as auto repair and maintenance services incidental to a vehicle lease) are subject to ECMRA reporting requirement. The respondent also recommended that the final rule clarify that the ECMRA reporting requirements apply to contracts for destruction, demolition, and removal.

Response: Title 10 U.S.C. 2330a(a), as amended by section 812 of the NDAA for FY 2017, specifies that the service acquisition portfolio group for equipment related services is included in the required reporting group. It is expected that contracts for equipment-related services with a total estimated value, including options, exceeding $3 million will be reported in SAM.

Comment: Two respondents indicated that the rule is duplicative of the existing FAR rule on service contract reporting that applies to civilian agencies (see FAR subpart 4.17). Respondents stated that there should not be two parallel systems, one for civilian agencies and another for defense agencies, because this situation causes confusion and compliance problems within industry.

Response: FAR subpart 4.17 does not apply to DoD. This proposed rule enables DoD to fulfill its obligation under 10 U.S.C. 2330a. Since publication of the proposed rule under 2012-D051, DoD has adopted the use of FPDS to collect a majority of the required data, in an effort to standardize the reporting process for contractors across the Federal Government.

Comment: Several respondents suggested that the ECMRA system is duplicative of other Government systems, such as FPDS, which can also be used to estimate the data provided in the annual inventory of contracts for services.

Response: DoD has adopted the service contract reporting process used by other Federal agencies and no longer require contractor reporting in ECMRA. This proposed rule will enable DoD to use FPDS to obtain a majority of the information required by 10 U.S.C. 2330a. FPDS does not provide data on the direct labor hours expended and dollar amounts invoiced for contracted services. Therefore, this proposed rule requires applicable contractors to enter the labor hours and dollar amounts in SAM, which is the process used by other Federal agencies, in accordance with FAR subpart 4.17.

Comment: Two respondents suggested that the separate instances of ECMRA (Army, Navy, Air Force, and other DoD agencies) be combined into one DoD-wide ECMRA system.

Response: The use of ECMRA is no longer necessary. This proposed rule requires contractors to enter information in SAM.

Comment: Two respondents suggested that the rule is duplicative of existing DoD reporting requirements, such as: (1) The Army's contractor manpower reporting requirement; and (2) the Secretary of Defense Memorandum entitled “Enterprise-wide Contractor Manpower Reporting Application,” dated November 2012, that requires all new contracts for services to include a contract line item for contractor manpower reporting and a requirement in the performance work statement for contractor manpower reporting.

Response: This rule will replace, not duplicate, the existing Army contract manpower reporting requirement and the requirements in the November 2012 Memorandum from the Under Secretary of Defense for Acquisition, Technology, and Logistics and the Acting Principal Deputy Under Secretary of Defense for Personnel and Readiness.

Comment: Two respondents suggested that the rule exceeds the scope of congressional intent, because DoD is already using its internal records and systems to achieve the statutory objective of the inventory of contracts for services.

Response: The rule does not exceed the scope of congressional intent, because existing systems and reports do not fully capture all of the data required by 10 U.S.C. 2330a.

Comment: Two respondents suggested that the requirement for subcontract reporting be changed. One respondent suggested that the prime contractor be required only to flow down the clause to subcontractors and relieved of the responsibility of reporting for subcontractors. The other respondent suggested that subcontractor data not be reported at all, as this is inconsistent with commercial practice.

Response: The proposed rule does not contain a requirement to flow down a clause. Instead, this proposed rule requires contractors to include its subcontractor labor hours in the total number of labor hours the contractor reports annually to SAM. The proposed rule leaves the process for collecting subcontractor data up to the discretion of each contractor.

Comment: One respondent suggested that more resources be provided to the Office of the Under Secretary of Defense for Personnel and Readiness workforce that administers and coordinates the inventory of contracts for services.

Response: This suggestion is beyond the scope of the rule.

Comment: One respondent noted that the ECMRA interface for the Fourth Estate (other DoD agencies and field activities) is not yet fully operational, in contrast to what is stated in the proposed rule. For example, there is no operational help desk support for Fourth Estate activities. The respondent suggests that the final rule should be delayed until ECMRA is consolidated into a common portal for all DoD agencies, or until the ECMRA instance for Fourth Estate activities is fully resourced.

Response: The use of ECMRA is no longer necessary. This proposed rule requires contractors to enter information in SAM.

Comment: One respondent questioned how the Government validates data provided by contractors in ECMRA. The respondent suggested that ECMRA be linked to Wide Area WorkFlow and that the contracting officer or the contracting officer's representative be allowed to inspect payroll data in order to validate contractor data entered into ECMRA.

Response: Agencies are responsible for ensuring the contractor submits information in SAM that is reasonable and consistent with available contract information. Agencies may use any contract data available, as appropriate and necessary, to meet this responsibility.

Comment: One respondent suggested that the rule be clearer about how the ECMRA will protect nonpublic data, such as direct labor hours and cost data.

Response: The use of ECMRA is no longer necessary.

Comment: One respondent requested clarification on the procedures to follow when the services under one contract support two or more DoD services or agencies.

Response: This proposed rule requires contractors to enter information in SAM, which is a single system able to collect all requisite data under this rule.

Comment: One respondent suggested that ECMRA should have a built-in capability for an overall point of contact at each agency level who can gather and manage the ECMRA information and that data be gathered at a centralized location.

Response: The use of ECMRA is no longer necessary. This proposed rule requires contractors to enter information in SAM, which is a Governmentwide system.

Comment: One respondent noted that it is unduly restrictive to allow only one contractor user per contract to view the data for that contract in ECMRA.

Response: The use of ECMRA is no longer necessary. This proposed rule requires contractors to enter information in SAM.

Comment: One respondent suggested that the rule should clarify the contractor's responsibilities in the event that the Government-populated information in ECMRA is incorrect.

Response: The use of ECMRA is no longer necessary. This proposed rule requires contractors to enter information in SAM. Contractors may contact the SAM Helpdesk or the contracting officer in the event that data needs to be updated in SAM.

Comment: One respondent suggested that the requiring activity, and not the contracting officer, be responsible for verifying the contractor's ECMRA compliance is documented.

Response: In accordance with FAR 1.602-2, the contracting officer is responsible for ensuring compliance with the terms of the contract.

Comment: A respondent suggested that a DD Form 1423, Contract Data Requirements List, be included as a requirement in the rule.

Response: The proposed DFARS clauses convey the requirement for contractor reporting to SAM; therefore, a DD Form 1423 is not necessary.

Comment: One respondent requested clarification regarding the prescription for the clause at DFARS 252.237-70XX with regard to indefinite-delivery, indefinite-quantity contracts. The respondent asked whether the clause must be included only if the expected dollar value of the individual task or delivery orders will exceed the SAT or if the total dollar value of all the task or delivery orders issued under the contract will exceed the SAT.

Response: The rule requires information reporting on each task order that meets the criteria and threshold for service contract reporting. The proposed rule does not require reporting at the contract level for indefinite-delivery contracts. The rule proposes a basic clause that applies to solicitations, contracts (other than indefinite-delivery contracts), and task orders awarded under non-DoD indefinite-delivery contracts; and an alternate clause that applies to DoD issued solicitations and contracts for indefinite-delivery type contracts. The basic clause and the alternate clause implement the reporting requirement for contracts and/or task orders that have a total estimated value, including options, exceeding $3 million and are for services in the four specified service acquisition portfolio groups. The basic clause advises contractors to report on the effort performed under the contract or the task order awarded under a non-DoD contract. The alternate clause advises the contractor to report on the effort performed under each task order awarded under a DoD indefinite-delivery contract that meets the criteria and threshold for service contract reporting.

Comment: One respondent suggested that the rule include a link to the product service code (PSC) manual available at www.acquisition.gov, to aid contracting personnel in determining the types of services to which the proposed rule applies or does not apply.

Response: The applicable PSCs will be identified in the DFARS Procedures, Guidance, and Information upon publication of the final rule.

Comment: One respondent suggested that the rule require the contracting officer to prepare a determination designating specifically the services to which the ECMRA reporting requirement would apply.

Response: It is not necessary for the contracting officer to prepare such a determination or provide further clarification to the contractor. This proposed rule only applies the requirement to report in SAM, via the DFARS clause, to those contracts and orders that meet the thresholds and criteria for service contract reporting, as expressed in 10 U.S.C. 2330a.

Comment: One respondent noted that many terms, including “direct labor hours” and “cost data,” are not defined in the proposed rule.

Response: This proposed rule only uses the term “direct labor hours,” which is defined in FAR 2.101.

Comment: Two respondents recommended that the term “services” be better defined for the purposes of informing both the Government and contractor when the proposed rule applies and when the contractor is responsible for entering data into ECMRA.

Response: This proposed rule only applies the requirement to report in SAM, via the DFARS clause, to those contracts and orders that meet or are expected to meet the thresholds and criteria for service contract reporting, as expressed in 10 U.S.C. 2330a. When awarded a contract, or task order placed under a non-DoD contract, this rule proposes a basic clause to notify contractors of the requirement to report in SAM on the effort performed under the award. When awarded an indefinite-delivery contract under which orders will be placed that may meet the thresholds and criteria for service contract reporting, this rule proposes an alternate clause to notify contractors of the requirement to report in SAM on the effort performed for a task order issued under the contract that meets the service contract reporting thresholds and criteria.

Comment: One respondent suggested that the Government reconsider whether this is a major rule. Title 5 U.S.C. 804 defines a major rule as one which the Office of Management and Budget (OMB) determines will cause a major increase in costs or prices for individual industries, or have a significant adverse effect on competition, employment, investment, productivity, or innovation. This rule imposes new reporting requirements, particularly for commercial item contractors that provide professional services and supplies. These contractors would not have been previously subject to the type of manpower reporting required by this rule. For small businesses, the need to build compliant procedures and automated systems could be a barrier to participating in the federal market. This is particularly the case when the cumulative effect of multiple and duplicative data reporting requirements is considered. The ultimate result over time will be a decrease in competition and innovation in the Federal market.

Response: This rule is not a major rule in that it does not have a significant impact on competition, employment, investment, productivity, innovation, or on the ability of U.S. enterprises to compete with foreign enterprises. Similar reporting requirements for civilian agencies have appeared in FAR subpart 4.17 since 2014, so many contractors already have experience with this type of reporting requirement. The scope of this rule has been decreased, because 10 U.S.C. 2330a, as amended by section 812 of the NDAA for FY 2017, limits data collection to four service acquisition portfolios and applies only to contracts and task orders exceeding $3 million in total estimated value, including options.

Comment: Two respondents stated that the proposed reporting system did not have a goal of minimizing the burden to small business and that the constant flow of new regulations to businesses have little regard for the benefit to the Government or burden on businesses.

Response: The burden applied to small businesses is the minimum consistent with applicable laws, Executive orders, regulations, and prudent business practices. The information collection requirement has been narrowly tailored to maximize the use of existing records already maintained by contractors and by the Government. To further minimize the impact, DoD is adopting the existing system and process used by the rest of the Government to obtain the requisite information from contractors, which maintains a familiar and consistent reporting requirement for contractors; and the information is collected electronically, help-desk support and user guides are available for SAM, and reporting requirements will be limited to a small number of data elements to facilitate ease of reporting and reduce contractor burden. In addition, the NDAA for FY 2017 raised the threshold for reporting to $3 million from the SAT and limited the data reporting to four service acquisition portfolio groups.

Comment: Two respondents stated that the Government has systems in place for collecting the required data and the rule would require duplicative contractor reporting that is not necessary for compliance. Two respondents noted that there will be two rules, one for DOD and the other non-DOD, which could potentially apply under a single contract vehicle and that determining which set of rules apply will be burdensome.

Response: The rule will not require duplicative reporting by contractors. The DoD and non-DoD reporting requirements are based on separate statutes. Further, the information collection requirement associated with this DFARS Case 2018-D063, once cleared by OMB, will supersede the reporting requirements approved under OMB Control Number 0704-0491, entitled “DoD Inventory of Contracts for Services Compliance.” Contracts awarded by DoD, or on behalf of DoD, will contain the proposed DFARS clauses.

Comment: One respondent stated that the rule conflicts with Paperwork Reduction Act constraints on rulemaking, namely that the rule must: (1) Be necessary for the proper performance of the agency; (2) not be duplicative of information otherwise reasonably accessible to the agency; and (3) reduce, to the extent practicable and appropriate, the burden on persons who shall provide information to or for the agency.

Response: The rule complies with the Paperwork Reduction Act. The information collection is necessary in order for DoD to meet the requirement of 10 U.S.C. 2330a, as amended, to collect certain service contract data and report annually to Congress. The rule is not duplicative of information otherwise reasonably accessible to DoD. DoD systems do not currently collect all of the data elements required by the statute.

The information collection requirement has been narrowly tailored to minimize the impact of reporting and maximize the use of existing records already maintained by contractors and by the Government. To minimize the impact, the information will be collected electronically, help-desk support will be provided to users, and reporting requirements will be limited to a small number of data elements.

Comment: Two respondents commented that the rule underestimates the number of contractors that will be impacted. One respondent indicated that the total estimated number of respondents of 13,269, including 7,962 for small businesses, seems low, since the GSA Schedules alone have 20,000 contractors and 80% of the contractors are small businesses. One respondent stated that the estimate for the total number of annual responses of approximately 54,000 appears low. In addition, several respondents commented that the estimate of an average of 1.4 hours per response is too low, citing reasons such as: (1) The billions of dollars in services for which DoD contracts for annually and the corresponding volume of data required to be entered, (2) the limitation of the ECMRA bulk upload capability, or (3) the impact on response time resulting from the flow down of the reporting requirement to subcontractors. One respondent stated that the burden is disproportionally high for small businesses that are less likely to have the necessary internal infrastructure.

Response: The estimated burdens for respondents and responses published in the previously proposed rule have been updated to reflect the revised requirements of 10 U.S.C. 2330a, as amended.

Consistent with the determinations that DoD made with regard to application of the requirements of section 846 of the NDAA for FY 2011, DoD does not intend to apply the requirements of 10 U.S.C. 2330a, as amended by section 812 of the NDAA for FY 2017, to contracts at or below the simplified acquisition threshold (SAT) or for commercially available off-the shelf items (COTS) items, but does intend to apply the rule to contracts for the acquisition of commercial items.

Section 846 of the NDAA for FY 2011 and section 812 of the NDAA for FY 2017 are silent on applicability to contracts and subcontracts in amounts no greater than the SAT or for the acquisition of commercial items. Title 10 U.S.C. 2330a(a), as amended by section 812 of the NDAA for FY 2017, however, only requires the collection of data on service contracts, under certain portfolio groups, that exceed $3 million, which effectively precludes application to acquisitions under the SAT. Also, the statute does not provide for civil or criminal penalties. Therefore, the statute does not apply to contracts or subcontracts in amounts not greater than the SAT or to the acquisition of commercial items unless the Principal Director, Defense Pricing and Contracting, makes a written determination as provided in 41 U.S.C. 1905 and 10 U.S.C. 2375.

Title 10 U.S.C. 2375 exempts contracts and subcontracts for the acquisition of commercial items, including COTS items, from provisions of law enacted after October 13, 1994, that, as determined by the Under Secretary of Defense for Acquisition and Sustainment (USD (A&S)), set forth policies, procedures, requirements, or restrictions for the acquisition of property or services unless—

• The provision of law—

○ Provides for criminal or civil penalties;

○ Requires that certain articles be bought from American sources pursuant to 10 U.S.C. 2533a or that strategic materials critical to national security be bought from American sources pursuant to 10 U.S.C. 2533b; or

○ Specifically refers to 10 U.S.C. 2375 and states that it shall apply to contracts and subcontracts for the acquisition of commercial items (including COTS items); or

• USD(A&S) determines in writing that it would not be in the best interest of the Government to exempt contracts or subcontracts for the acquisition of commercial items from the applicability of the provision.

This authority has been delegated to the Principal Director, Defense Pricing and Contracting.

Consistent with 10 U.S.C. 2375, DoD has determined that it is in the best interest of the United States to apply the requirements of 10 U.S.C. 2330a to the acquisition of commercials items, excluding COTS items. The intent of the statute is to enhance DoD's ability to manage the total force, inclusive of military, civilian, and contractor personnel. Specifically, section 2330a, as amended, requires the military departments and defense agencies to ensure that the inventory of contracts for services required by the statute is used to inform strategic workforce planning decisions under 10 U.S.C. 129a and develop budget justification materials for services in accordance with 10 U.S.C. 235. An exception for services that meet the definition of a commercial item would exclude significant sums expended by DoD on contracted services intended to be covered by the law, thereby undermining the overarching public policy purpose of the law. Therefore, this rule will apply to the acquisition of commercial items, excluding COTS.

This rule will require a contractor to report data in SAM on an annual basis for a DoD contract or task order that is valued in excess of $3 million and is for logistics management services, equipment related services, knowledge-based services, or electronics and communications services.

When applicable, contractors will be required to annually report the total dollar amount invoiced for and the total number of direct labor hours expended on services performed under the contract or task order during the preceding fiscal year. The total number of direct labor hours reported to SAM should be the total of both the contractor hours and its subcontractors' hours. Significant costs are avoided by using existing Government systems (FPDS and SAM) to collect elements of the required data.

The following is a summary of the estimated public and Government costs calculated in perpetuity in 2016 dollars at a 7-percent discount rate:

To access the full Regulatory Cost Analysis for this rule, go to the Federal eRulemaking Portal at www.regulations.gov, search for “DFARS Case 2018-D063,” click “Open Docket,” and view “Supporting Documents.”

Executive orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.

This rule is not expected to be subject to E.O. 13771, because this rule is not a significant regulatory action under E.O. 12866.

DoD does not expect this proposed rule to have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., because the rule only requires annual reporting of two data items for a limited number and type of service contracts. However, an initial regulatory flexibility analysis has been performed and is summarized as follows:

The Department of Defense is proposing to amend the Defense Federal Acquisition Regulation Supplement (DFARS) to establish a data collection system that provides management information on each purchase of services by a military department or defense agency in excess of $3 million for the following service acquisition portfolio groups: Logistics management services; equipment related services; knowledge-based services; and, electronics and communications services.

The objective of this proposed rule is to implement 10 U.S.C. 2330a, as modified by section 812 of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2017 (Pub. L. 114-328).

Based on data from the Federal Procurement Data System for FY 2016 through 2018, DoD awards annually an average of 4,386 service contracts and orders to 1,934 unique entities that have an estimated value greater than $3M and are within the four portfolio groups outlined in the rule. Of the 4,386 contracts and orders awarded annually, approximately 2,059 (47%) are made to 1,227 (63%) unique small businesses entities.

This proposed rule requires all contractors that are awarded a contract or order in excess of $3 million for services in any of the four service acquisition portfolio groups to report contract data in SAM. The contractor is required to report the total amount invoiced for services performed during the preceding fiscal year and the number of direct labor hours, including subcontractor hours, expended on services performed during the preceding fiscal year. The Government estimates that a journeyman level contractor employee with basic knowledge of the contract would be required to enter the data. The contractor employee may also need to gather additional billing information from the organization in order to complete the data input in SAM.

This rule does not duplicate, overlap, or conflict with any other Federal rules. There are no known significant alternative approaches to the proposed rule that would meet the requirements of the applicable statute.

DoD invites comments from small business concerns and other interested parties on the expected impact of this rule on small entities. DoD will also consider comments from small entities concerning the existing regulations in subparts affected by this rule in accordance with 5 U.S.C. 610. Interested parties must submit such comments separately and should cite 5 U.S.C. 610 (DFARS Case 2018-D063), in correspondence.

The rule contains information collection requirements that require the approval of the Office of Management and Budget (OMB) under the Paperwork Reduction Act (44 U.S.C. chapter 35). Accordingly, DoD has submitted a request for approval of a new information collection requirement concerning DFARS Case 2018-D063, Data Collection and Inventory for Services Contracts, to the Office of Management and Budget. Upon OMB clearance of this new collection and publication of the associated final DFARS rule, a related program clearance, OMB Control Number 0704-0491, DoD Enterprise-wide Contractor Manpower Reporting Application (ECMRA), will be discontinued.

A. Public reporting burden for this collection of information is estimated to average 2 hours per response, including the time for gathering and maintaining the data and completing and reviewing the collection of information.

The annual reporting burden estimated as follows:

Respondents: 1,934.

Responses per respondent: 2.267, approximately.

Total annual responses: 4,386.

Hours per response: 2 hours.

Total response burden hours: 8,772.

Written comments and recommendations on the proposed information collection, including suggestions for reducing this burden, should be sent to Ms. Jasmeet Seehra at the Office of Management and Budget, Desk Officer for DoD, Room 10236, New Executive Office Building, Washington, DC 20503, or email Jasmeet_K._Seehra@omb.eop.gov, with a copy to the Defense Acquisition Regulations System, Attn: Carrie Moore OUSD(A&S)DPC/DARS, Room 3B941, 3060 Defense Pentagon, Washington, DC 20301-3060. Comments can be received from 30 to 60 days after the date of this notification, but comments to OMB will be most useful if received by OMB within 30 days after the date of this notification.

Public comments are particularly invited on: Whether this collection of information is necessary for the proper performance of functions of the DFARS, and will have practical utility; whether our estimate of the public burden of this collection of information is accurate, and based on valid assumptions and methodology; ways to enhance the quality, utility, and clarity of the information to be collected; and ways in which we can minimize the burden of the collection of information on those who are to respond, through the use of appropriate technological collection techniques or other forms of information technology.

To request more information on this proposed information collection or to obtain a copy of the proposal and associated collection instruments, please write to the Defense Acquisition Regulations System, Attn: Carrie Moore, OUSD(A&S)DPC/DARS, Room 3B941, 3060 Defense Pentagon, Washington, DC 20301-3060, or email osd.dfars@mail.mil. Include DFARS Case 2018-D063 in the subject line of the message.

Therefore, 48 CFR parts 204, 212, and 252 are proposed to be amended as follows:

DoD is proposing to amend the DFARS to remove the DFARS clause 252.239-7006, Tariff Information, and the associated clause prescription at DFARS 239.7411(a). This clause is prescribed for use in solicitations, contracts, and basic agreements for telecommunications services. The clause requires the contractor to provide the contracting officer with the following information:

• Upon request, a copy of the contractor's existing tariffs.

• Before filing, a copy of any application to be made to a regulatory agency that requests new or changes to rates, charges, services, or regulations related to any tariff or to any of the facilities or services furnished primarily to the Government.

• Upon request, all supporting documentation prepared in connection with any application to a regulatory agency.

• Notice of any application that anyone other than the contractor files with a regulatory body which affects or will affect the rate or conditions of services under the agreement or contract.

This clause was added to the DFARS to implement a standardized approach across DoD for addressing critical issues associated with the acquisition of telecommunication services. Since its implementation, technological advances, and the passage of additional telecommunication regulations at 47 CFR 42.10, have made this DFARS clause unnecessary. Pursuant to 47 CFR 42.10, telecommunications carriers are now required to make tariff and non-tariff information available to the public online at the carrier's internet website and to update the information regularly. Additionally, online databases and tools have been created to track and monitor changes in telecommunications tariffs, prices, and services. Since contracting officers are now able review carriers' websites and access online tariff tools and databases as needed, it is unnecessary and burdensome to require the contractor to provide this information separately to the contracting officer in accordance with the clause. As such, this DFARS clause can be removed.

The removal of this DFARS text supports a recommendation from the DoD Regulatory Reform Task Force. On February 24, 2017, the President signed Executive Order (E.O.) 13777, “Enforcing the Regulatory Reform Agenda,” which established a Federal policy “to alleviate unnecessary regulatory burdens” on the American people. In accordance with E.O. 13777, DoD established a Regulatory Reform Task Force to review and validate DoD regulations, including the DFARS. Public notification of the establishment of the DFARS Subgroup to the DoD Regulatory Reform Task Force, for the purpose of reviewing DFARS provisions and clauses, was published in the Federal Register at 82 FR 28041 on June 20, 2017 (see also 82 FR 35741 (August 1, 2017)), and requested public input. No public comments were received on this clause. Subsequently, the DoD Task Force reviewed the requirements of DFARS clause 252.239-7006, Tariff Information, and determined that the DFARS coverage was unnecessary and recommended removal.

This rule only removes obsolete DFARS clause 252.239-7006, Tariff Information. Therefore, the rule does not impose any new requirements on contracts at or below the simplified acquisition threshold and for commercial items, including commercially available off-the-shelf items.

This rule impacts only telecommunication service providers who do business, or want to do business, with DoD. DFARS clause 252.239-7006, Tariff Information, requires telecommunications service contractors to submit certain tariff and non-tariff information to DoD when requested by the contracting officer or as specified in the clause. Removal of this DFARS clause is expected to result in savings for both DoD and DoD contractors that provide telecommunications services.

The following is a summary of the estimated public and Government cost savings:

To access the full Regulatory Cost Analysis for this rule, go to the Federal eRulemaking Portal at www.regulations.gov, search for “DFARS Case 2018-D044,” click “Open Docket,” and view “Supporting Documents.”

E.O.s 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.

This rule is expected to be an E.O. 13771 deregulatory action. We estimate that this rule generates $2.03 million in annualized cost savings, discounted at 7 percent relative to year 2016, over a perpetual time horizon. Details on the estimated cost savings can be found in section III. of this preamble.

DoD does not expect this proposed rule to have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., because the rule only applies to major weapon system acquisition programs. However, an initial regulatory flexibility analysis has been performed and is summarized as follows:

DoD is proposing to amend the Defense Federal Acquisition Regulation Supplement (DFARS) to implement a recommendation from the DoD Regulatory Task Force established pursuant to Executive Order 13777, Enforcing the Regulatory Reform Agenda, to repeal the clause at DFARS 252.239-7006, Tariff Information, and the associated clause prescription at DFARS 239.7411(a).

The objective of this rule is to remove the requirement for contractors to report tariff information under the DFARS clause. The legal basis for this change is 41 U.S.C. 1303.

According to the Electronic Document Access database, DoD awards approximately 855 contracts to 83 unique contractors each year that include DFARS clause 252.239-7006. It is estimated that 171 of those contracts are awarded to small entities.

This proposed rule does not include any new reporting or recordkeeping requirements for small entities. Rather this rule reduces the information collection requirements approved under OMB Control Number 0704-0341. Small entities will no longer be required to provide tariff information to the contracting officer in accordance with DFARS clause 252.239-7006.

The rule does not duplicate, overlap, or conflict with any other Federal rules.

There are no known significant alternative approaches to the proposed rule that would meet the policy objective of the rule.

DoD invites comments from small business concerns and other interested parties on the expected impact of this rule on small entities.

DoD will also consider comments from small entities concerning the existing regulations in subparts affected by this rule in accordance with 5 U.S.C. 610. Interested parties must submit such comments separately and should cite 5 U.S.C. 610 (DFARS Case 2018-D044), in correspondence.

This rule affects the information collection requirements in the DFARS provision 252.239-7006, Tariff Information, currently approved under OMB Control Number 0704-0341, entitled “Defense Federal Acquisition Regulation Supplement (DFARS) Part 239, Acquisition of Information Technology and associated clauses at DFARS 252.239-7000 and 252.239-7006.” The rule revises an information collection requirement, which requires the approval of OMB under the Paperwork Reduction Act (44 U.S.C. chapter 35). Accordingly, DoD has submitted a request to OMB for approval of a revised information collection.

Public reporting burden for this previously approved collection of information is estimated to average 2 hours per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. This rule proposes to eliminate DFARS 252.239-7006, Tariff Information, thereby reducing the associated current annual reporting burden and OMB inventory of hours as follows:

Respondents: 83.

Responses per respondent: Approximately 10.3.

Total annual responses: 855.

Hours per response: 2 hours.

Total response Burden Hours: 1,710.

Request for Comments Regarding Paperwork Burden Reduction. Written comments and recommendations on the proposed reduction of this information collection should be sent to Ms. Jasmeet Seehra at the Office of Management and Budget, Desk Officer for DoD, Room 10236, New Executive Office Building, Washington, DC 20503, or email Susan_M._Minson@omb.eop.gov, with a copy to the Defense Acquisition Regulations System, Attn: Carrie Moore; OUSD(A&S)DPC/DARS, Room 3B941, 3060 Defense Pentagon, Washington, DC 20301-3060. Comments can be received from 30 to 60 days after the date of this notification, but comments to OMB will be most useful if received by OMB within 30 days after the date of this notification.

To request more information on this proposed information collection or to obtain a copy of the proposal and associated collection instruments, please write to the Defense Acquisition Regulations System, Attn: Carrie Moore, OUSD(A&S)DPC/DARS, Room 3B941, 3060 Defense Pentagon, Washington, DC 20301-3060, or email osd.dfars@mail.mil. Include DFARS Case 2018-D044 in the subject line of the message.

Therefore, 48 CFR parts 239 and 252 are proposed to be amended as follows:

Background

The Service is the Federal agency delegated with the primary responsibility for managing migratory birds. Our authority derives from the Migratory Bird Treaty Act of 1918 (MBTA; 16 U.S.C. 703-712), as amended, which implements conventions with Great Britain (for Canada), Mexico, Japan, and Russia. We implement the provisions of the MBTA through the regulations in parts 10, 13, 20, 21, 22, and 92 of title 50 of the Code of Federal Regulations (CFR). The MBTA protects migratory birds (listed in 50 CFR 10.13) from take directed at birds, except as authorized under the MBTA. Regulations pertaining to specific migratory bird permit types are at 50 CFR parts 21 and 22.

The double-crested cormorant is a fish-eating migratory bird that is distributed across a large portion of North America. There are five different breeding populations, variously described by different authors as the Alaska, Pacific (or Western), Interior, Atlantic, and Southern populations. Although these populations are described by their breeding ranges, the birds commingle to various extents on their migration and wintering areas, with birds from populations closer to each other overlapping more than those that are more distant.

Cormorant populations have increased over both the short term (2005-2015) and long term (1966-2015) (Sauer et al. 2017). Permits issued by the Service to take birds are one method available to reduce conflicts. However, prior to applying for permits to take cormorants, individuals and entities experiencing conflicts with cormorants should attempt nonlethal techniques ( e.g., hazing, habitat modification) to alleviate the conflict. Nonlethal techniques combined with lethal take should be more effective and may ultimately result in less need for lethal take in the future.

In response to ongoing damage at aquaculture facilities and other damage and conflicts associated with increasing cormorant populations, the Service administered regulations that included, in addition to Depredation Permits (located at 50 CFR 21.41), an Aquaculture Depredation Order (which was located at 50 CFR 21.47) beginning in 1998 and a Public Resource Depredation Order (which was located at 50 CFR 21.48), which began in 2003. Both of these regulations were in place until May 2016 when they were vacated by Court order (see more below).

The Aquaculture Depredation Order eliminated individual permit requirements in 13 States for private individuals, corporations, State agencies, and Federal agencies taking cormorants at aquaculture facilities. The Public Resource Depredation Order enabled States, Tribes, and the U.S. Department of Agriculture's Wildlife Services in 24 States, without individual depredation permits, to take cormorants found committing or about to commit, and to prevent, depredations on the public resources of fish (including hatchery stock at Federal, State, and Tribal facilities), wildlife, plants, and their habitats.

In May 2016, these depredation orders were vacated by the United States District Court for the District of Columbia. The Court concluded that the Service did not sufficiently consider the effects of the depredation orders on cormorant populations and other affected resources and failed to consider a reasonable range of alternatives in the review within the environmental assessment (EA) issued in 2014 under the National Environmental Policy Act of 1969, as amended (NEPA). Following the Court ruling, the Service prepared an EA to address continuing conflicts with cormorants (USFWS 2017). The authority for authorizing lethal take of depredating cormorants reverted to the issuance of individual depredation permits pursuant to 50 CFR 21.41. Under the 2017 EA, cormorants could lethally be taken only to address conflicts with aquaculture, human health and safety, threatened and endangered species (as listed under the Endangered Species Act of 1973, 16 U.S.C. 1531 et seq. ) and State-listed species of management concern, and personal property (under the 2017 EA, take of cormorants to protect wild and publicly stocked fisheries would only be allowed if to protect threatened or endangered species).

Conflicts in aquatic systems continue to exist between cormorants and fish stocks managed by Federal, State, and Tribal agencies as recreational and/or commercial fisheries. Conflicts also exist between cormorants and conservation of other species and habitats in some areas. As fish-eating birds, cormorant predation of fish occurs not only at aquaculture facilities, but also in private recreational ponds and large aquatic ecosystems. While conflicts exist between cormorants and some stakeholders, birders and other interested parties value cormorants for their aesthetic and existential values.

The Service is responsible for balancing the lethal take of cormorants to alleviate conflicts where available data support such take and maintaining sustainable populations of cormorants and minimizing the regulatory burden on Federal and State agencies, Tribes, and individual citizens. In making decisions, the Service strives to use an effective and transparent decision-making process that ensures input from migratory bird and fisheries management programs and other stakeholders, fulfills requirements under NEPA, and addresses key biological uncertainties. When determining allowable take, the Service must consider uncertainty related to cormorant population dynamics, estimated maximum sustainable lethal take, and risk of over-exploitation. Furthermore, the Service must identify monitoring requirements that could be used to assess the effects of lethal take on cormorant populations and to ensure take is commensurate with population status. Monitoring can also improve future decisions regarding allowable take and how that allowable take could be determined. States, Tribes, and other stakeholders can provide assistance and information. The Service will formally convene meetings with the flyways and other relevant stakeholders to develop a specific cormorant population monitoring plan. This plan will be made public within approximately one year of publication of the final rule.

Cormorants are migratory waterbirds protected by the MBTA. They are native to North America and range widely across the continent, typically inhabiting wetlands and adjacent upland habitats. Cormorants also are found in some human-modified environments including airport airfields and aquaculture ponds. The bird-management community generally accepts that there are five different breeding populations, variously described by different authors as Alaska, Pacific (Western), Interior, Atlantic, and Southern populations.

Cormorant abundance in North America has increased dramatically since the 1960s and 1970s, mostly due to the growth of the Interior and Atlantic populations. The current estimate of cormorant abundance in the continental United States and Canada is 872,455 to 983,188 birds (USFWS 2020).

Prior to 1998, the sole method for authorizing the lethal take of depredating cormorants to alleviate damage and conflicts was through the issuance of depredation permits pursuant to 50 CFR 21.41, which allows the take of migratory birds that are injuring “crops or other interests.” In 1998, the Service published a final rule (63 FR 10550-10561, March 4, 1998) establishing a depredation order that authorized commercial freshwater aquaculture producers in 13 States to take cormorants without the need for a depredation permit when cormorants were found committing or about to commit depredations on aquaculture stocks. That rule was located at 50 CFR 21.47. The Service continued to issue depredation permits to address damage and conflicts to property, natural resources, and threats to human health and safety pursuant to 50 CFR 21.41. Any individual or entity conducting lethal take of cormorants under depredation permits or the depredation order was required to submit a report detailing the take to the Service annually.

The increase in cormorant abundance across areas of North America and the subsequent range expansion of cormorants has been well documented along with concerns of the negative impacts associated with the expanding population ( e.g., Taylor and Dorr 2003, Hunter et al. 2006, Atlantic Flyway Council and Mississippi Flyway Council 2010, Pacific Flyway Council 2012). In response to increasing requests for depredation permits to alleviate damage and conflicts associated with cormorants, the Service issued a Final Environmental Impact Statement (FEIS) pursuant to NEPA and made changes to the regulations governing the take of cormorants in 2003. The 2003 FEIS considered direct, indirect, and cumulative effects of alternatives for cormorant management in the United States and discussed mitigating measures. In October 2003, based on analysis in the FEIS and review of public and agency comments, the Service published a final rule and notice of record of decision (68 FR 58022-58037, October 8, 2003) that modified the existing depredation order for aquaculture facilities (previously located at 50 CFR 21.47). The regulations became effective in November 2003. The modified depredation order for aquaculture facilities eliminated the need for private individuals, corporations, State agencies, and Federal agencies to obtain a depredation permit to take cormorants at aquaculture facilities in 13 States. It also authorized U.S. Department of Agriculture/Wildlife Services' employees to take cormorants at roost sites in the vicinity of aquaculture facilities during October, November, December, January, February, March, and April.

That final rule in 2003 also established a depredation order that authorized Federal agencies, State fish and wildlife agencies, and Tribes in 24 States to take cormorants to reduce damage and conflicts with public resources without the need for a depredation permit. At that time, the Service defined a public resource as a natural resource managed and conserved by public agencies, which included fish ( i.e., free-swimming fish and stocked fish at Federal, State, and Tribal hatcheries that are intended for release in public or Tribal waters), wildlife, plants, and their habitats. The depredation order for public resources was previously located at 50 CFR 21.48. As with previous regulations, any individual or entity conducting lethal take of cormorants under depredation permits or the depredation orders was required to submit a report detailing the take to the Service annually.

To evaluate the potential effects on the cormorant population from the implementation of the two depredation orders, a mitigating measure required by the 2003 FEIS was to review and renew, if warranted, the two depredation orders every 5 years. Subsequently, the Service developed an EA pursuant to NEPA in 2009 and again in 2014 that determined that a 5-year extension of the expiration date of the two depredation orders would not threaten cormorant populations and that activities conducted under the two depredation orders would not have a significant impact on the human environment. Therefore, from October 2003 through May 2016, the Service authorized the take of cormorants pursuant to the two depredation orders (which covered certain States), through the issuance of depredation permits for activities in States not addressed in the two depredation orders, and through the issuance of scientific collecting permits (50 CFR 21.23).

Since the Court's vacating of the depredation orders in May 2016 as discussed above, the Service has been reviewing and issuing individual depredation permits in the central and eastern lower 48 States pursuant to two separate analyses conducted under NEPA. Individuals or entities apply for these permits to address site-specific conflicts, and each application is logged, evaluated, and acted upon (approved or rejected) on a case-by-case basis based on the merits of the permit application.

The 2017 EA (USFWS 2017) evaluated issuing depredation permits to take cormorants for specific circumstances across 37 central and eastern States and the District of Columbia. The selected alternative (Reduced Take Alternative) authorized the average annual take that occurred during 2010-2015 (51,571 birds). This amount was well below the allowable level resulting from the take analyses included in the EA (82 FR 52936-52937, November 15, 2017). In December 2019, in response to requests for increased take to alleviate growing conflicts, the Service issued a notice (84 FR 69762-69762, December 19, 2019) that it would implement a different proposed alternative analyzed in the 2017 EA (Potential Take Limit Alternative) that had a higher annual take threshold, increasing the take of cormorants authorized by permits to 74,396.

Management of cormorants in the western United States (Western population, P. albociliatus ) is also through site-specific, case-by-case permits. The Service authorizes take of Western population cormorants primarily to reduce predation-related losses by cormorants of federally threatened or endangered juvenile salmon ( Oncorhyncus spp.) and steelhead ( O. mykiss ) migrating to the Pacific Ocean. Additional authorizations for take occur at Federal, State, and Tribal hatcheries rearing federally threatened or endangered fish species, to protect aquaculture facilities, and for removing nests related to infrastructure maintenance. The U.S. Army Corps of Engineers' Double-crested Cormorant Management Plan to Reduce Predation of Juvenile Salmonids in the Columbia River Estuary—Final Environmental Impact Statement (FEIS; USACE 2015) guides management activities related to cormorant take. The National Oceanographic and Atmospheric Administration's National Marine Fisheries Service (NOAA Fisheries) had previously determined that a reduced cormorant population of 5,380 to 5,939 breeding pairs on East Sand Island in the Columbia River Estuary would restore juvenile steelhead survival to the environmental baseline levels (NOAA Fisheries 2014), and the Service authorized lethal take at levels that attempt to achieve that colony abundance. Specifically, the Service authorized approximately 2,300 cormorants to be lethally taken each year under depredation permits, scientific collecting permits, and special purpose permits.

The Service expects the number of conflicts to increase, and we expect that demand for authorizations to take cormorants will continue to increase as a means to reduce those conflicts in the future. For example, between 2007 and 2018, the number of permit requests to take depredating birds (exclusive of requests to act under the depredation orders) increased from slightly less than 200 to almost 300 (USFWS, unpublished data), and the number of cormorants taken annually between 2004 and 2015 increased from about 42,000 to 66,500 (USFWS 2017: 50 CFR 21.24, 21.41, 21.47, and 21.48 authorizations only). As requests to take cormorants increase, the use of only depredation permits to address conflicts will become increasingly time-consuming and cumbersome, and will be less responsive to needs of those seeking relief from conflicts with cormorants.

To alleviate conflicts with cormorants, we propose using a method called Potential Take Level (PTL) analyses (Wade 1998, Runge et al. 2004) to determine the number of cormorants that may be taken while maintaining the species (and breeding populations) at sustainable levels. This process has been used to determine allowable take levels for cormorants in a previous EA (USFWS 2017) and for other species, including several bird species ( e.g., USFWS 2009, Runge et al. 2009, Johnson et al. 2012, Zimmerman et al. 2019). Methods used to determine population sizes and allowable take levels in this proposed rule are detailed in USFWS (2020; Draft Environmental Impact Statement: Management of conflicts associated with double-crested cormorants). The median amount of allowable take resulting from the analysis was 163,219 birds annually. However, we recommend being more conservative and allowing take only up to the lower 20 percent of the distribution of the PTL annually (123,157 birds). Population-specific recommended levels of take are: Atlantic, 35,938; Interior, 77,050; Western, 8,881; and Southern, 1,288. At those levels of take, the continental population of double-crested cormorants is expected to average about 815,000 birds.

This proposed rule would bring all populations of double-crested cormorants under a common assessment framework to determine allowable levels of take. However, levels of take for each population could differ based on their current abundances, population biology, and population-specific management objectives.

The Service proposes to add a new permit option under 50 CFR part 21 (Special Double-Crested Cormorant Permit) that would be available to State and Tribal wildlife agencies in the 48 contiguous United States to manage conflicts specifically associated with double-crested cormorants. The special permit would be available only to a State or Tribal wildlife management agency responsible for migratory bird management on lands under their jurisdiction. Under this permit, the Service would authorize State and Tribal wildlife agencies to conduct lethal take of double-crested cormorants that is normally prohibited on lands within their respective jurisdictions. The Service will issue this permit only when it is expected to reduce conflicts involving depredation at State- and Tribal-owned or operated aquaculture facilities (including hatcheries); impacts to health and human safety; impacts to threatened and endangered species (as listed under the Endangered Species Act of 1973) and listed species identified in State- or Tribal-specific legislation as threatened or endangered; damage to State- or Tribal-owned property and assets; and depredations of wild and publicly stocked fish stocked by State agencies or Tribes. Those States and Tribes not wishing to obtain this new permit could apply for depredation permits (50 CFR 21.41) to address conflicts with cormorants. However, under the scope of the November 2017 EA, these permits do not authorize take of cormorants to reduce or prevent conflicts with wild and publicly stocked fisheries (except for threatened or endangered species).

The Service would retain overall authority for the take of double-crested cormorants to ensure that levels of take are consistent with management objectives. States and Tribes must use nonlethal methods, and determine that those methods are ineffective, before lethally taking double-crested cormorants. Lethal management should be considered as part of an integrated approach to managing cormorant conflicts and used only when other methods fail to resolve conflicts. No permit is required merely to scare or herd migratory birds other than threatened or endangered species or bald or golden eagles (see 50 CFR 21.41). The Service would periodically determine the population-specific numbers of double-crested cormorants that could be taken lethally during a specified number of years in efforts to reduce conflicts while sustaining cormorant abundances, and would track authorized take through permits issued to States and Tribes to ensure take does not exceed those levels specified in the PTL. The annual allocation of take to States and Tribes would be based on recent demand by those entities and adjusted as needed (while remaining at or below population-specific allowable take levels) to respond to spatial and temporal changes in population status and the need to reduce conflicts in specific regions. The Service will prepare reports periodically, as necessary, to provide the public with information regarding the take of cormorants and the extent to which this permit, along with other management tools ( e.g., depredation permits per 50 CFR 21.41), is achieving management objectives.

The special double-crested cormorant permit would be subject to the following conditions/restrictions:

1. States and Tribes must use nonlethal methods, and determine that those methods are ineffective, before lethally taking double-crested cormorants. States and Tribes and their subpermittees must make efforts to avoid disturbance to co-nesting species. Existing research findings and publications detailing appropriate methods and/or models for reducing conflicts should be used to justify activities.

2. A permit under this section does not authorize the taking of any other migratory bird, including other species of cormorants; the disturbance of bald or golden eagles; or the take of any species listed under the Endangered Species Act as threatened or endangered. If these impacts to other migratory bird species or to threatened and endangered species are likely to occur, the permittee must obtain permits specifically authorizing those activities ( i.e., additional migratory bird, Eagle Act and/or threatened and endangered species permits).

3. Actions under the permit may be conducted during any time of the year on lands under the jurisdiction of the State or Tribe, but only when cormorants are committing or are about to commit depredations at Tribal- and State-owned or operated aquaculture facilities (including hatcheries); to alleviate impacts to health and human safety; reduce impacts to threatened and endangered species (as listed under the Endangered Species Act) and listed species identified in State- or Tribal-specific legislation as threatened or endangered; and to prevent damage to State- or Tribal-owned property and assets. This permit would also apply to the reduction and prevention of depredations of wild and publicly stocked fish stocked by State agencies or Tribes when supported by information that take would reduce such conflicts. Permits will be issued annually. Permittees will be required to submit an annual report by December 31 each year detailing the amount of lethal take that occurred under their permit and for what purpose the take was conducted.

4. Anyone undertaking lethal control with a firearm must use nontoxic shot or nontoxic bullets (50 CFR 20.21). However, this prohibition would not apply if an air rifle or an air pistol is used.

5. Individuals conducting lethal control may not use decoys, calls, or other devices or bait to lure birds within gun range.

6. Methods of take are at the discretion of the permittee responsible for the action. Methods may include, but are not limited to, firearms, traps, egg and nest manipulation, and other techniques that are consistent with accepted wildlife damage management programs. Only 100 percent corn oil, a substance exempted from regulation by the Environmental Protection Agency under the Federal Insecticide, Fungicide, and Rodenticide Act, may be used to oil eggs.

7. States and Tribes and their employees and subpermittees may possess, transport, and otherwise dispose of double-crested cormorants taken. Double-crested cormorants killed and nests/eggs destroyed under the authority of this permit must be properly disposed of, including donation to public museums or public scientific and educational institutions for exhibition, scientific, or educational purposes, or buried or incinerated. This permit does not allow for birds or their parts or nests/eggs to be sold, offered for sale, bartered, or shipped for the purpose of sale or barter.

8. The State or Tribe must also require the property owner or occupant on whose premises the State or Tribe is conducting activities to allow, at all reasonable times, including during actual operations, free and unrestricted access to any Service special agent or refuge officer, State or Tribal wildlife or deputy wildlife agent, warden, protector, or other wildlife law enforcement officer on the premises where they are, or were, conducting activities.

9. States and Tribes may designate subpermittees who must operate under the conditions of the permit.

10. Any employee or subpermittee authorized by the State or Tribe to carry out actions under the special permit must retain in their possession a copy of the State's or Tribe's permit while carrying out any action.

11. Any State or Tribal agency, when exercising the privileges of this permit, must keep records of all activities, including those of subpermittees, carried out under the authority of the special permit. Prior to any permit renewal, the Service will require an annual report detailing the activities conducted under the permit and the numbers of cormorants/nests/eggs lethally taken, treated, or destroyed.

12. Nothing in the permit should be construed to authorize the take of cormorants, their eggs, or nests contrary to any State or Tribal law or regulation or on any Federal land without written authorization by the appropriate management authority. Further, none of the privileges granted under the permit shall be exercised without any State or Tribal permit that may be required for such activities.

13. The Service reserves the authority to immediately suspend or revoke any permit if the Service finds that the terms and conditions set forth in the permit have not been adhered to, as specified in 50 CFR 13.27 and 13.28.

Since November 2017, permits have been available only to address conflicts with aquaculture, human health and safety, threatened and endangered species, and personal property; take of cormorants to protect wild and publicly stocked fisheries has not been authorized unless warranted to protected threatened or endangered species. The conflicts with stocked fisheries are increasingly causing concerns with State and Federal wildlife agencies, particularly those involved with providing recreational fishing opportunities. As cormorant abundance increases, and even at current levels, the issuance of individual depredation permits to address conflicts is becoming increasingly time-consuming and lengthy in some cases. With the proposed special double-crested cormorant permit, which increases the flexibility of States and Tribes to address issues and also expands the scope of conflicts that can be addressed to wild and publicly stocked fish, the Service expects that efforts to reduce those conflicts will increase, including lethal take of birds, nests, and eggs. Localized abundances of cormorants may decline as a result of these efforts, but regional and continental populations are not likely to be negatively impacted.

The Service expects that, by allowing States and Tribes to address conflicts through a special permit, more aggressive management activities will result. By authorizing conflict-management activities at the State or Tribal level, instead of at the Service Regional level, management activities would be more responsive and timely than is currently the case. Quicker resolution of conflicts ultimately may result in fewer complaints regarding cormorants. However, in expanding authority given to the States and Tribes via this permit, workload burdens may shift with more being borne by the States and Tribes and less by the Service.

Importantly, reducing the abundance of double-crested cormorants is not the goal of the Service or this proposed management action. Reducing their overall abundance does not guarantee that conflicts in specific areas will decrease. If cormorants are attracted to an area due to food resources, nesting habitats, or other factors, those places will remain attractive regardless of the size of the cormorant population and may still experience damage to the resources. Rather, the goal of the Service is to reduce the number of conflicts with cormorants by combining lethal and nonlethal methods and allowing the lethal take of cormorants only when supported by information that such take would reduce conflicts. As a consequence, abundance of cormorants in some areas may be reduced, but regional and continental populations will be managed at sustainable levels, albeit at somewhat reduced abundances. The Service also wants to ensure accountability not only in determining allowable take, but also in reporting of actual take by permittees. We will annually review reports submitted by permit holders and will periodically assess the overall impact of this permit program to ensure compatibility with long-term conservation of double-crested cormorants. The Service believes our proposed approach results in the transparency and accountability necessary to make informed decisions about and promote adherence to authorized levels of take.

On January 22, 2020 (85 FR 3601-3603), the Service published an advance notice of proposed rulemaking (ANPR) and announced our intent to prepare a NEPA document indicating that the Service intended to establish new regulations regarding the management of double-crested cormorants. The comment period for the ANPR continued through March 9, 2020. The ANPR listed possible alternatives composed of the following:

(1) Establish a new permit for State and Tribal wildlife agencies for authorizing certain cormorant management and control activities;

(2) Establish an aquaculture depredation order; and

(3) Both (1) and (2) in combination.

We also announced that several public scoping meetings would be held, and that specific dates and times for the public meetings would be available on the internet at https://www.fws.gov/birds/management/managed-species/double-crested-cormorants.php. A total of four public scoping webinars were convened, two on February 11, 2020, and two on February 12, 2020. Additionally, we conducted two webinars provided only to Tribal members on February 19 and 27, 2020. We provided all attendees of all webinars with information on the following topics regarding cormorants, their management, and the regulations process: (1) Biology and population changes; (2) background of the issues and previous management approaches; (3) current management of conflicts; (4) proposed approaches and alternatives; and (5) the planning process for the NEPA analysis. We also informed attendees that they could provide comments on the proposed actions and the scope of the NEPA review via a website ( http://www.regulations.gov, Docket No. FWS-HQ-MB-2019-0103) or by U.S. mail or hand-delivery to Public Comments Processing, Attn: FWS-HQ-MB-2019-0103; U.S. Fish and Wildlife Service Headquarters, MS: PRB (JAO/3W), 5275 Leesburg Pike, Falls Church, VA 22041-3803.

The Department of the Interior's policy is, whenever possible, to afford the public an opportunity to participate in the rulemaking process. We received more than 1,400 comments in response to the ANPR. You may review the comments received at the Federal eRulemaking Portal: http://www.regulations.gov in Docket No. FWS-HQ-MB-2019-0103. We considered those comments in developing this proposed rule, and a summary of the comments will be included in the NEPA document associated with this rulemaking action. In addition, we invite interested persons to submit written comments, suggestions, or recommendations regarding this proposed regulation. Before promulgating final regulations, we will consider all comments we receive related to this rulemaking action, including those on the ANPR, the NEPA document, and this proposed rule. The comments, and any additional information we receive, may lead to final regulations that differ from those provided in this proposal.

You may submit your comments and materials concerning this proposed rule by one of the methods listed in ADDRESSES . We will not consider comments sent by email or fax. We will not consider hand-delivered comments that we do not receive or mailed comments that are not postmarked by the date specified in DATES , or written comments sent to an address other than the one listed in ADDRESSES .

We may post all comments in their entirety—including your personal identifying information—on http://www.regulations.gov. Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time. While you can ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so. We will consider, but possibly may not respond in detail to, each comment. We will summarize all comments we receive during the comment period and respond to them in the preamble of the final rule.

We seek comments or suggestions from the public, governmental agencies, Tribes, the scientific community, industry, or any other interested parties. To ensure that the rulemaking process effectively evaluates all potential issues and impacts, we are seeking comments and suggestions on the following:

(1) The balance we should seek between cormorant abundance and mitigation of conflicts with them;

(2) whether we sufficiently addressed a reasonable range of alternative management options;

(3) the level of interest and participation in use of a new special permit by States and Tribes, and the potential issues those entities would need to address if they availed themselves of such a permit;

(4) limitations as to the scope and scale ( e.g., geographic, seasonal) under which cormorant control activities should be conducted; and

(5) the best means to monitor cormorant take and abundance to ensure the Service and its partners meet objectives of reducing conflicts and maintaining sustainable abundances of cormorants.

In addition, we ask for information that can be used to make our assessment of economic impacts more robust. In particular we are seeking data on the number, type, and locality of establishments that will likely benefit from our proposal along with data, including costs of implementation, to help us better characterize the extent of benefits. We also ask for information and data to help us better characterize the location, types, and number of recreational fisheries that are expected to benefit from our proposal.

Executive Order 12866 provides that the Office of Information and Regulatory Affairs (OIRA) in the Office of Management and Budget (OMB) will review all significant rules. In accordance with the criteria in Executive Order 12866, we do not believe this proposed action is a significant regulatory action subject to OMB review; however, OIRA has waived their review regarding their significance determination of this proposed rule.

This rule will not have an annual economic effect of $100 million or adversely affect any economic sector, productivity, competition, jobs, the environment, or other units of government. This proposed action will not create inconsistencies with other agencies' actions or otherwise interfere with an action taken or planned by another agency. Our draft economic analysis determined that this rule is expected to result in positive economic benefits to both the commercial aquaculture industry as well as the recreational sport fishing industry.

E.O. 13563 reaffirms the principles of E.O. 12866 while calling for improvements in the Nation's regulatory system to promote predictability, to reduce uncertainty, and to use the best, most innovative, and least burdensome tools for achieving regulatory ends. The Executive order directs agencies to consider regulatory approaches that reduce burdens and maintain flexibility and freedom of choice for the public where these approaches are relevant, feasible, and consistent with regulatory objectives. E.O. 13563 emphasizes further that regulations must be based on the best available science and that the rulemaking process must allow for public participation and an open exchange of ideas. We have developed this proposed rule in a manner consistent with these requirements.

Codifying a new permit for the management of double-crested cormorants would provide an additional tool for States and Tribes to appropriately manage conflicts within their borders, while maintaining overall authority for the take of birds within the Service. Further, current regulations allow the take of cormorants only for the purposes of reducing conflicts with and damage to aquaculture, human health and safety, threatened and endangered species (as listed under the Endangered Species Act of 1973) and State-listed species of management concern, and personal property. Many of the conflicts with cormorants involve depredations of sport fish by cormorants, for which there is no relief under current Federal regulations unless warranted to reduce impacts to threatened and endangered fish species listed under the ESA. This new permit would allow the take of cormorants to reduce depredation of wild and publicly stocked fish stocked by State agencies or Tribes, thus enhancing the scope of conflict resolution to more comprehensively address areas of concern. However, the total number of cormorants from each population that could be taken annually would be determined by the Service to ensure that cormorant populations are sustainable.

The Service does not have empirical information to quantify the changes in costs as a result of this new permit, because we do not know how many States and Tribes would avail themselves of this permit and the extent to which conflicts would be addressed using it. However, we expect that the overall cost and regulatory burden to individuals, businesses, and State, Tribal, and Federal government agencies associated with this new permit would be lower than exists under current regulations. The reduction would be the result of the need for fewer individual depredation permits needed to address conflicts compared to single State or Tribal permits that could be used; hence, total costs associated with permit applications and biological assessments of those applications likely would be lower.

We do not believe this proposed rule is an E.O. 13771 (“Reducing Regulation and Controlling Regulatory Costs”) (82 FR 9339, February 3, 2017) regulatory action because we believe this rule is not significant under E.O. 12866; however, OIRA has waived their review regarding their E.O. 12866 significance determination of this proposed rule.

Under the Regulatory Flexibility Act (RFA; 5 U.S.C. 601 et seq. ), as amended by the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA; 5 U.S.C. 801 et seq. ), whenever an agency is required to publish a notice of rulemaking for any proposed or final rule, it must prepare and make available for public comment a regulatory flexibility analysis that describes the effects of the rule on small entities ( i.e., small businesses, small organizations, and small government jurisdictions). However, no regulatory flexibility analysis is required if the head of the agency certifies the rule will not have a significant economic impact on a substantial number of small entities. The SBREFA amended the RFA to require Federal agencies to provide a certification statement of the factual basis for certifying that the rule will not have a significant economic impact on a substantial number of small entities.

According to the Small Business Administration, small entities include small organizations such as independent nonprofit organizations; small governmental jurisdictions, including school boards and city and town governments that serve fewer than 50,000 residents; and small businesses (13 CFR 121.201). Small businesses include finfish farming and fish hatcheries (NAICS 112511) and other types of commercial aquaculture farms (NAICS Code 112519). The small business size standard defined for these businesses (as defined by the U.S. Small Business Administration) is businesses with revenues under $0.75 million.

The Service has difficulties estimating impacts to recreational fisheries because few studies have investigated direct economic impacts of cormorant management on recreational fisheries. Although a few studies have estimated impacts to local economies, loss of fishing day activities in those local areas may be offset through engaging in angling opportunities elsewhere. While it is feasible that this proposed rule could have localized effects on recreational fisheries, data does not exist to predict where those effects could occur. Further research is necessary to determine whether any impacts that may be seen at local scales can be extended to larger scales. However, the Service believes that the proposed rule will result in an overall net benefit to facilities as it will enable them to more readily and easily obtain permits to control double-crested cormorants that are negatively impacting their operations. Thus we are certifying that, if promulgated, the proposed rule would not have a significant economic impact on a substantial number of small business entities. Therefore, an initial regulatory flexibility analysis is not required.

In accordance with the Unfunded Mandates Reform Act (2 U.S.C. 1501 et seq. ), we have determined the following:

(a) This proposed rule would not “significantly or uniquely” affect small government activities, because the Federal Government would not require States to obtain this permit. A small government agency plan is not required.

(b) This proposed rule would not produce a Federal mandate on local, State, or Tribal governments or private entities. Therefore, this action is not a “significant regulatory action” under the Unfunded Mandates Reform Act.

In accordance with E.O. 12630, this proposed rule does not contain a provision for taking of private property, and would not have significant takings implications. A takings implication assessment is not required.

This proposed rule would not interfere with the States' or Tribes' abilities to manage themselves or their funds. This rule would not have sufficient federalism effects to warrant preparation of a federalism summary impact statement under E.O. 13132.

In accordance with E.O. 12988, we have reviewed this proposed rule and determined that it will not unduly burden the judicial system and meets the requirements of sections 3(a) and 3(b)(2) of the Order.

This proposed rule contains new information collections. All information collections require approval under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ). We may not conduct or sponsor and you are not required to respond to a collection of information unless it displays a currently valid OMB control number. The new reporting and/or recordkeeping requirements identified below require approval by OMB:

(1) FWS Form 3-200-90, Permit Application—Special Double-Crested Cormorant Permit (50 CFR part 21): This new permit would be available only to a State or Tribal wildlife management agency responsible for migratory bird management on lands under their jurisdiction. Under this permit, the Service would authorize States and Tribal wildlife agencies to conduct lethal take to reduce conflicts involving depredation at State- and Tribal-owned or operated aquaculture facilities (including hatcheries); impacts to health and human safety; impacts to threatened and endangered species (as listed under the Endangered Species Act of 1973) and listed species identified in State- or Tribal-specific legislation as threatened or endangered; damage to State- or Tribal-owned property and assets; and depredations of wild and publicly stocked fish stocked by State agencies or federally recognized Tribes.

Any State or Tribal wildlife agency wishing to obtain a permit must submit an application (FWS Form 3-200-90) to the appropriate Regional Director containing the general information and certification required by 50 CFR 13.12(a) plus the following information:

a. A brief description of your State's or Tribe's double-crested cormorant conflicts, including physical location(s);

b. A detailed statement showing that the double-crested cormorant management and take activities will address one or more of the issues specified above in paragraph (1);

c. The requested annual take of double-crested cormorants, including eggs and nests;

d. A statement indicating what information will be collected to assess whether the management and take of double-crested cormorants is alleviating the damage or other conflict;

e. A statement indicating that the State or Tribe will inform and brief all employees and subpermittees of the requirements of these regulations and permit conditions;

f. A list of all subpermittees who may conduct activities under the Special Double-Crested Cormorant Permit, including their names, addresses, and telephone numbers; and

g. The name and telephone number of the individual in your agency who will be in charge of the double-crested cormorant management activities authorized under the permit.

(2) Designation of Subpermittees: States and Tribes may designate subpermittees who must operate under the conditions of the permit. Subpermittees can be employees of State and Tribal wildlife agencies, USDA Wildlife Services employees, and employees of Federal and State agencies or private incorporated companies specializing in wildlife damage abatement.

(3) FWS Form 3-202-56, Annual Report: The State or Tribe must submit an annual report (FWS Form 3-202-56) detailing activities, including the time, numbers, and locations of birds, eggs, and nests taken and nonlethal techniques utilized, before December 31 of each year. The Service will require an annual report by the State or Tribe prior to any permit renewal.

(4) Recordkeeping Requirements: Any State or Tribal agency, when exercising the privileges of this permit, must keep records of all activities, including those of subpermittees, carried out under the authority of the special permit.

Title of Collection: Federal Fish and Wildlife Permit Applications and Reports—Special Double-Crested Cormorants; 50 CFR 21.

OMB Control Number: 1018-New.

Form Numbers: FWS Forms 3-200-90 and 3-202-56.

Type of Review: New.

Respondents/Affected Public: State and/or Tribal governments.

Total Estimated Number of Annual Respondents: 700.

Total Estimated Number of Annual Responses: 700.

Estimated Completion Time per Response: Varies from 45 minutes to 16 hours, depending on activity.

Total Estimated Number of Annual Burden Hours: 4,563.

Respondent's Obligation: Voluntary.

Frequency of Collection: On occasion for applications; annually or on occasion for reports.

Total Estimated Annual Nonhour Burden Cost: None.

As part of our continuing effort to reduce paperwork and respondent burdens, we invite the public and other Federal agencies to comment on any aspect of this information collection, including:

(1) Whether or not the collection of information is necessary for the proper performance of the functions of the agency, including whether or not the information will have practical utility;

(2) The accuracy of our estimate of the burden for this collection of information, including the validity of the methodology and assumptions used;

(3) Ways to enhance the quality, utility, and clarity of the information to be collected; and

(4) How might the agency minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of response.

Send your comments and suggestions on this information collection to OMB by the date indicated in DATES at (202) 395-5806 (fax) or OIRA_Submission@omb.eop.gov (email). Please provide a copy of your comments to the Service Information Collection Clearance Officer, U.S. Fish and Wildlife Service, 5275 Leesburg Pike, MS: PRB (JAO/3W), Falls Church, VA 22041-3803 (mail); or Info_Coll@fws.gov (email). Please reference OMB Control Number 1018-Cormorants in the subject line of your comments.

We are evaluating this proposed regulation in accordance with the criteria of the NEPA, the Department of the Interior regulations on Implementation of the NEPA (43 CFR 46.10-46.450), and the Department of the Interior Manual (516 DM 8). We will complete our analysis, in compliance with NEPA, before finalizing this regulation. When completed, you may review the NEPA document and any comments received at the Federal eRulemaking Portal: http://www.regulations.gov in Docket No. FWS-HQ-MB-2019-0103.

Section 7 of the ESA of 1973, as amended (16 U.S.C. 1531-44), requires that “The Secretary [of the Interior] shall review other programs administered by him and utilize such programs in furtherance of the purposes of this Act” (16 U.S.C. 1536(a)(1)). It further states that “[e]ach Federal agency shall, in consultation with and with the assistance of the Secretary, insure that any action authorized, funded, or carried out by such agency . . . is not likely to jeopardize the continued existence of any endangered species or threatened species or result in the destruction or adverse modification of [critical] habitat.” Before the Service issues a final rule regarding the issuance of a special permit available to the States and Tribes for the take of cormorants to reduce conflicts, we will comply with provisions of the ESA as necessary to ensure that the new regulation is not likely to jeopardize the continued existence of any species designated as endangered or threatened or destroy or adversely modify its critical habitat.

In accordance with Executive Order 13175, “Consultation and Coordination with Indian Tribal Governments,” and the Department of the Interior's manual at 512 DM 2, we are considering the possible effects of this proposed rule on federally recognized Indian Tribes. The Department of the Interior strives to strengthen its government-to-government relationship with Indian Tribes through a commitment to consultation when appropriate and recognition of their right to self-governance and tribal sovereignty. We readily acknowledge our responsibility to communicate meaningfully with recognized Federal Tribes on a government-to-government basis. We have evaluated this proposed rule under the criteria in Executive Order 13175 and under the Department's tribal consultation policy and have determined that this rule may have a substantial direct effect on federally recognized Indian tribes. Accordingly, we have initiated outreach to Tribes and will initiate government-to-government consultation with federally recognized Indian tribes to ensure compliance with the Executive order.

We are required by Executive Orders 12866 and 12988 and by the Presidential Memorandum of June 1, 1998, to write all rules in plain language. This means that each rule we publish must:

(a) Be logically organized;

(b) Use the active voice to address readers directly;

(c) Use clear language rather than jargon;

(d) Be divided into short sections and sentences; and

(e) Use lists and tables wherever possible.

If you feel that we have not met these requirements, send us comments by one of the methods listed in ADDRESSES . To better help us revise the rule, your comments should be as specific as possible. For example, you should tell us the numbers of the sections or paragraphs that are unclearly written, which sections or sentences are too long, the sections where you feel lists or tables would be useful, etc.

E.O. 13211 requires agencies to prepare Statements of Energy Effects when undertaking certain actions. This proposed rule is not a significant regulatory action under E.O. 13211 and would not significantly affect energy supplies, distribution, or use. Therefore, this action is not a significant energy action. No Statement of Energy Effects is required.

For the reasons described in the preamble, we propose to amend part 21 of subchapter B, chapter I, title 50 of the Code of Federal Regulations, as set forth below: