This action, pursuant to 5 U.S.C. 553, amends regulations issued to carry out a marketing order as defined in 7 CFR 900.2(j). This rule is issued under Marketing Order No. 959, as amended (7 CFR part 959), regulating the handling of onions grown in south Texas. Part 959, (referred to as “the Order”) is effective under the Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-674), hereinafter referred to as the “Act.” The Committee locally administers the Order and is comprised of producers and handlers operating within the area of production.

The Department of Agriculture (USDA) is issuing this rule in conformance with Executive Orders 13563 and 13175. This action falls within a category of regulatory actions that the Office of Management and Budget (OMB) exempted from Executive Order 12866 review. Additionally, because this rule does not meet the definition of a significant regulatory action, it does not trigger the requirements contained in Executive Order 13771. See OMB's Memorandum titled “Interim Guidance Implementing Section 2 of the Executive Order of January 30, 2017, titled `Reducing Regulation and Controlling Regulatory Costs' ” (February 2, 2017).

This rule has been reviewed under Executive Order 12988, Civil Justice Reform. Under the Order now in effect, south Texas onion handlers are subject to assessments. Funds to administer the Order are derived from such assessments. It is intended that the assessment rate will be applicable to all assessable onions for the 2019-20 fiscal year, and continue until amended, suspended, or terminated.

The Act provides that administrative proceedings must be exhausted before parties may file suit in court. Under section 608c(15)(A) of the Act, any handler subject to an order may file with USDA a petition stating that the order, any provision of the order, or any obligation imposed in connection with the order is not in accordance with law and request a modification of the order or to be exempted therefrom. Such handler is afforded the opportunity for a hearing on the petition. After the hearing, USDA would rule on the petition. The Act provides that the district court of the United States in any district in which the handler is an inhabitant, or has his or her principal place of business, has jurisdiction to review USDA's ruling on the petition, provided an action is filed not later than 20 days after the date of the entry of the ruling.

This rule decreases the assessment rate from $0.065, the rate that was established for the 2017-18 and subsequent fiscal periods, to $0.05 per 50-pound equivalent of onions handled for the 2019-20 and subsequent fiscal years.

The Order provides authority for the Committee, with the approval of USDA, to formulate an annual budget of expenses and collect assessments from handlers to administer the program. The members are familiar with the Committee's needs and with the costs of goods and services in their local area and are thus in a position to formulate an appropriate budget and assessment rate. The assessment rate is formulated and discussed in a public meeting. Thus, all directly affected persons have an opportunity to participate and provide input.

For the 2017-18 and subsequent fiscal periods, the Committee recommended and USDA approved an assessment rate that would continue in effect from fiscal period to fiscal period unless modified, suspended, or terminated by USDA upon recommendation and information submitted by the Committee or other information available to USDA.

On November 19, 2019, the Committee unanimously recommended 2019-20 expenditures of $174,807 and an assessment rate of $0.05 per 50-pound equivalent of onions. In comparison, last year's budgeted expenditures were $169,807. The assessment rate of $0.05 is $0.015 lower than the rate currently in effect. The Committee recommended decreasing the assessment rate to help reduce the Committee's reserve fund and reduce the assessment burden on handlers.

The major expenditures recommended by the Committee for the 2019-20 year include $69,992 for management and administration, $50,000 for compliance, and $20,000 for research. Budgeted expenses for these items in 2018-19 were $69,992, $50,000, and $20,000, respectively.

The Committee derived the recommended assessment rate by considering anticipated expenses, expected shipments of 3,960,000 50-pound bags, and the amount of funds available in the authorized reserve. Income derived from handler assessments calculated at $198,000 (3.96 million multiplied by $0.05), along with interest income and funds from the Committee's authorized reserve, should be adequate to cover budgeted expenses of $174,807. Funds in the reserve (currently $201,844) will be kept within the maximum permitted by the Order (approximately two fiscal period's expenses as stated in § 959.43) at the end of the 2019-20 fiscal period.

The assessment rate established in this rule will continue in effect indefinitely unless modified, suspended, or terminated by USDA upon recommendation and information submitted by the Committee or other available information.

Although this assessment rate will be in effect for an indefinite period, the Committee will continue to meet prior to or during each fiscal period to recommend a budget of expenses and consider recommendations for modification of the assessment rate. The dates and times of Committee meetings are available from the Committee or USDA. Committee meetings are open to the public and interested persons may express their views at these meetings. USDA will evaluate Committee recommendations and other available information to determine whether modification of the assessment rate is needed. Further rulemaking will be undertaken as necessary. The Committee's 2019-20 budget and those for subsequent fiscal periods will be reviewed and, as appropriate, approved by USDA.

Pursuant to requirements set forth in the Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612), the Agricultural Marketing Service (AMS) has considered the economic impact of this rule on small entities. Accordingly, AMS has prepared this final regulatory flexibility analysis.

The purpose of the RFA is to fit regulatory actions to the scale of businesses subject to such actions in order that small businesses will not be unduly or disproportionately burdened. Marketing orders issued pursuant to the Act, and the rules issued thereunder, are unique in that they are brought about through group action of essentially small entities acting on their own behalf.

There are approximately 60 producers of onions in the production area and approximately 30 handlers subject to regulation under the Order. Small agricultural producers are defined by the Small Business Administration (SBA) as those having annual receipts less than $1,000,000, and small agricultural service firms are defined as those whose annual receipts are less than $30,000,000 (13 CFR 121.201).

According to the National Agricultural Statistics Service (NASS), the weighted producer price for South Texas onions during the 2018-19 season was around $9.09 per 50-pound equivalent. The Committee reports total onion shipments were approximately 4.2 million 50-pound equivalents. Using the weighted average price and shipment information, the total 2018-19 crop value is estimated at $38.2 million. Dividing the crop value by the estimated number of producers (60) yields an estimated average receipt per producer of $636,700, so the majority of producers would have annual receipts of less than $1,000,000.

The average handler price for south Texas onions during the 2018-19 season was approximately $11.00 per 50-pound equivalent. Using the price average and shipment information, the total 2018-19 handler crop value is estimated at $46.2 million. Dividing this figure by the number of handlers (30) yields an estimated average annual handler receipts of $1.54 million, which is below the SBA threshold for small agricultural service firms. Thus, the majority of onion producers and handlers may be classified as small entities.

This final rule decreases the assessment rate collected from handlers for the 2019-20 and subsequent fiscal periods from $0.065 to $0.05 per 50-pound equivalent of Texas onions. The Committee unanimously recommended 2019-20 expenditures of $174,807 and an assessment rate of $0.05 per 50-pound equivalent. The assessment rate of $0.05 is $0.015 lower than the 2017-18 rate. The quantity of assessable onions for the 2019-20 fiscal period is estimated at 3.96 million 50-pound equivalents. Thus, the $0.05 rate should provide $198,000 in assessment income (3.96 million multiplied by $0.05). Income derived from handler assessments, along with interest income and funds from the Committee's authorized reserve, should be adequate to cover budgeted expenses.

The major expenditures recommended by the Committee for the 2019-20 year include $69,992 for management and administration, $50,000 for compliance, and $20,000 for research. Budgeted expenses for these items in 2018-19 were $69,992, $50,000, and $20,000, respectively.

The Committee recommended decreasing the assessment rate to reduce the assessment burden on handlers and utilize funds from the authorized reserve to help cover Committee expenses.

Prior to arriving at this budget and assessment rate, the Committee considered information from various sources, such as the Committee's Budget and Personnel Committee. Alternative expenditure levels were discussed by this group, based upon the relative value of various activities to the South Texas onion industry. Based on the estimated shipments, the recommended assessment rate of $0.05 would provide $198,000 in assessment income. The Committee determined that assessment revenue, along with interest income and funds from authorized reserves would be adequate to cover budgeted expenses for the 2019-20 fiscal period.

A review of historical information and preliminary information pertaining to the upcoming fiscal period indicates that the average producer price for the 2019-20 season should be approximately $10.15 per 50-pound equivalent of Texas onions. Therefore, the estimated assessment revenue for the 2019-20 fiscal period as a percentage of total producer revenue would be about 0.49 percent.

This action decreases the assessment obligation imposed on handlers. Assessments are applied uniformly on all handlers, and some of the costs may be passed on to producers. However, decreasing the assessment rate reduces the burden on handlers and may also reduce the burden on producers.

The Committee's meeting was widely publicized throughout the South Texas onion industry. All interested persons were invited to attend the meeting and participate in Committee deliberations on all issues. Like all Committee meetings, the November 19, 2019, meeting was a public meeting, and all entities, both large and small, were able to express views on this issue.

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

This rule imposes no additional reporting or recordkeeping requirements on either small or large South Texas onion handlers. As with all Federal marketing order programs, reports and forms are periodically reviewed to reduce information requirements and duplication by industry and public sector agencies. As noted in the initial regulatory flexibility analysis, USDA has not identified any relevant Federal rules that duplicate, overlap, or conflict with this final rule.

AMS is committed to complying with the E-Government Act, to promote the use of the internet and other information technologies to provide increased opportunities for citizen access to Government information and services, and for other purposes.

A proposed rule concerning this action was published in the Federal Register on March 19, 2020 (85 FR 15743). Copies of the proposed rule were also mailed or sent via email to all South Texas onion handlers. The proposal was made available through the internet by USDA and the Office of the Federal Register. A 30-day comment period ending April 20, 2020, was provided for interested persons to respond to the proposal.

Four comments were received. One was in support, one considered both maintaining the current assessment rate and lowering the assessment rate, and two comments did not address the merits of the proposal.

One comment received in support of the regulation stated the assessment rate should be decreased given the state of the national economy. The comment received that addressed both maintaining and reducing the assessment rate expressed that the proposed action would not be a significant benefit to producers. The commenter also recognized the indirect burden of assessments on producers and stated that maybe the assessment rate should be lowered. The Committee recommended the decrease in the assessment rate to help reduce the assessment burden on handlers. This change reduces the assessment burden on the industry handlers by around $60,000, a reduction in total assessments of nearly 23 percent. The decreased assessment rate still covers the budgeted expenses for the Committee and reduces the assessment burden for handlers. It may also reduce the burden on producers.

Accordingly, no changes will be made to the rule as proposed, based on the comments received.

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

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

For the reasons set forth in the preamble, 7 CFR part 959 is amended as follows:

Table of Contents I. Obtaining Information and Submitting Comments II. Rulemaking Procedure III. Background IV. Discussion of Changes V. Voluntary Consensus Standards VI. Agreement State Compatibility VII. Plain Writing VIII. Environmental Assessment and Finding of No Significant Environmental Impact IX. Paperwork Reduction Act Statement X. Regulatory Flexibility Certification XI. Regulatory Analysis XII. Backfitting and Issue Finality XIII. Congressional Review Act XIV. Availability of Documents I. Obtaining Information and Submitting Comments A. Obtaining Information

Please refer to Docket ID NRC-2019-0202 when contacting the NRC about the availability of information for this action. You may obtain publicly-available information related to this action by any of the following methods:

• Federal Rulemaking Website: Go to https://www.regulations.gov and search for Docket ID NRC-2019-0202.

• NRC's Agencywide Documents Access and Management System (ADAMS): You may obtain publicly-available documents online in the ADAMS Public Documents collection at https://www.nrc.gov/reading-rm/adams.html. To begin the search, select “Begin Web-based ADAMS Search.” For problems with ADAMS, please contact the NRC's Public Document Room (PDR) reference staff at 1-800-397-4209, 301-415-4737, or by email to pdr.resource@nrc.gov. For the convenience of the reader, instructions about obtaining materials referenced in this document are provided in the “Availability of Documents” section.

• Attention: The Public Document Room (PDR), where you may examine and order copies of public documents is currently closed. You may submit your request to the PDR via email at PDR.Resource@nrc.gov or call 1-800-397-4209 between 8:00 a.m. and 4:00 p.m. (EST), Monday through Friday, except Federal holidays.

Please include Docket ID NRC-2019-0202 in your comment submission.

The NRC cautions you not to include identifying or contact information that you do not want to be publicly disclosed in your comment submission. The NRC will post all comment submissions at https://www.regulations.gov as well as enter the comment submissions into ADAMS. The NRC does not routinely edit comment submissions to remove identifying or contact information.

If you are requesting or aggregating comments from other persons for submission to the NRC, then you should inform those persons not to include identifying or contact information that they do not want to be publicly disclosed in their comment submission. Your request should state that the NRC does not routinely edit comment submissions to remove such information before making the comment submissions available to the public or entering the comment into ADAMS.

This rule is limited to the changes contained in Renewed Amendment No. 16 to Certificate of Compliance No. 1004 and does not include other aspects of the Standardized NUHOMS® System design. The NRC is using the direct final rule procedure to issue this amendment because it represents a limited and routine change to an existing certificate of compliance that is expected to be non-controversial. The NRC has determined that, with the changes, reasonable assurance for adequate protection of public health and safety will continue to be ensured. The amendment to the rule will become effective on September 14, 2020. However, if the NRC receives significant adverse comments on this direct final rule by July 30, 2020, then the NRC will publish a document that withdraws this action and will subsequently address the comments received in a final rule as a response to the companion proposed rule published in the Proposed Rules section of this issue of the Federal Register . Absent significant modifications to the proposed revisions requiring republication, the NRC will not initiate a second comment period on this action.

A significant adverse comment is a comment where the commenter explains why the rule would be inappropriate, including challenges to the rule's underlying premise or approach, or would be ineffective or unacceptable without a change. A comment is adverse and significant if:

(1) The comment opposes the rule and provides a reason sufficient to require a substantive response in a notice-and-comment process. For example, a substantive response is required when:

(a) The comment causes the NRC to reevaluate (or reconsider) its position or conduct additional analysis;

(b) The comment raises an issue serious enough to warrant a substantive response to clarify or complete the record; or

(c) The comment raises a relevant issue that was not previously addressed or considered by the NRC.

(2) The comment proposes a change or an addition to the rule, and it is apparent that the rule would be ineffective or unacceptable without incorporation of the change or addition.

(3) The comment causes the NRC to make a change (other than editorial) to the rule, certificate of compliance, or technical specifications.

Section 218(a) of the Nuclear Waste Policy Act of 1982, as amended, requires that “[t]he Secretary [of the Department of Energy] shall establish a demonstration program, in cooperation with the private sector, for the dry storage of spent nuclear fuel at civilian nuclear power reactor sites, with the objective of establishing one or more technologies that the [Nuclear Regulatory] Commission may, by rule, approve for use at the sites of civilian nuclear power reactors without, to the maximum extent practicable, the need for additional site-specific approvals by the Commission.” Section 133 of the Nuclear Waste Policy Act states, in part, that “[the Commission] shall, by rule, establish procedures for the licensing of any technology approved by the Commission under Section 219(a) [sic: 218(a)] for use at the site of any civilian nuclear power reactor.”

To implement this mandate, the Commission approved dry storage of spent nuclear fuel in NRC-approved casks under a general license by publishing a final rule that added a new subpart K in part 72 of title 10 of the Code of Federal Regulations (10 CFR) entitled “General License for Storage of Spent Fuel at Power Reactor Sites” (55 FR 29181; July 18, 1990). This rule also established a new subpart L in 10 CFR part 72 entitled “Approval of Spent Fuel Storage Casks,” which contains procedures and criteria for obtaining NRC approval of spent fuel storage cask designs. The NRC subsequently issued a final rule on December 22, 1994 (59 FR 65898), that approved the Standardized NUHOMS® System design and added it to the list of NRC-approved cask designs provided in § 72.214 as Certificate of Compliance No. 1004.

By application dated August 24, 2015, as supplemented on February 9, 2016, TN Americas LLC submitted a request to the NRC, in accordance with § 72.244, to renew and revise Certificate of Compliance No. 1004. On December 4, 2017, the NRC issued the renewals of the initial certificate; Amendment Nos. 1 through 11 and 13, Revision 1; and Amendment No. 14 of Certificate of Compliance No. 1004 for the Standardized NUHOMS® System. Subsequently, Renewed Amendment No. 15 was issued on December 14, 2018. The certificates were renewed for an additional 40-year period. This certificate, its amendments, and all future amendments to the certificate are referred to as Renewed Amendments.

On June 29, 2017, TN Americas LLC submitted a request to the NRC to amend Certificate of Compliance No. 1004. TN Americas LLC supplemented its request on the following dates: August 31, 2017; October 13, 2017; November 16, 2017; April 26, 2018; June 7, 2018; September 3, 2019; September 6, 2019; September 10, 2019; and September 11, 2019. Because this amendment is subsequent to TN Americas LLC's Standardized NUHOMS® System, Certificate of Compliance No. 1004 renewal, it is subject to the Aging Management Program requirements of the renewed certificate of compliance; therefore, it is referred to as “Renewed Amendment No. 16.” Renewed Amendment No. 16 contains no design or fabrication changes to the Standardized NUHOMS® System; rather, the applicant requested changes to the format and content of the certificate.

This amendment application was used as a pilot project to apply a qualitative risk-informed approach (using the “graded approach criteria”) that could be used to streamline the format and content of certificates of compliance. In 2016 and 2017, the NRC coordinated with external stakeholders through a series of public workshops to explore options for achieving efficiencies through changes to the format and content of certificates of compliance. The information obtained from those workshops supported development of risk-informed, graded approach criteria that could be used to streamline the format and content of a certificate of compliance for a spent fuel storage system. The graded approach criteria help determine the level of detail and location of information that should be included in a certificate of compliance for a spent fuel dry storage cask design.

The NRC prepared a preliminary safety evaluation report that documents its review of TN Americas LLC's amendment request for Renewed Amendment No. 16. Chapter 2 of the preliminary safety evaluation report for this amendment discusses the development of the graded approach criteria in more detail, including information on the public meetings that were held and how the criteria were applied in review of this amendment request. The graded approach is further described in Regulatory Issue Resolution Protocol I-16-01. The NRC recently endorsed the graded approach criteria by letter to the Nuclear Energy Institute, dated January 8, 2020.

The preliminary safety evaluation report additionally documents that the proposed changes to Certificate of Compliance No. 1004 continue to provide reasonable assurance of adequate protection to public health and safety. The preliminary safety evaluation report also concludes that the proposed changes were included in the appropriate section of the certificate of compliance, its appendices, and/or the updated final safety analysis report; and that the proposed changes did not include any design or fabrication changes.

In reaching this determination, the NRC reviewed the applicant's use of the graded approach criteria that are described in detail in Chapter 2 of the preliminary safety evaluation report. In general, the criteria were used to evaluate whether the changes proposed to the format and content of Certificate of Compliance No. 1004 were appropriate. The staff reviewed the applicant's use of the graded approach criteria to ensure that the certificate included information that was important to safety and that no information was removed if the information met one of the risk criteria. The changes to Certificate of Compliance No. 1004 and its appendices are identified with revision bars in the margin of each licensing document.

As documented in the preliminary safety evaluation report, there are no changes to cask design requirements in the proposed amendment. The design of the cask would prevent loss of containment, shielding, and criticality control in the event of each evaluated accident condition. This amendment does not reflect a change in design or fabrication of the cask. In addition, because there are no design or fabrication changes, there are no resulting changes in occupational exposure or offsite dose rates from the implementation of Renewed Amendment No. 16; therefore, exposure and dose rate limits would remain well within the limits specified by 10 CFR part 20, “Standards for Protection Against Radiation.” With no design or fabrication changes, there will be no significant change in the types or amounts of any effluent released, no significant increase in the individual or cumulative radiation exposure, and no significant increase in the potential for or consequences from radiological accidents.

The NRC staff determined that the amended Standardized NUHOMS® System design, when used under the conditions specified in the certificate of compliance, the technical specifications, and the NRC's regulations, will meet the requirements of 10 CFR part 72; therefore, adequate protection of public health and safety will continue to be reasonably assured. When this direct final rule becomes effective, persons who hold a general license under § 72.210 may, consistent with the license conditions under § 72.212, load spent nuclear fuel into TN Americas LLC Standardized NUHOMS® System casks that meet the criteria of Renewed Amendment No. 16 to Certificate of Compliance No. 1004.

The National Technology Transfer and Advancement Act of 1995 (Pub. L. 104-113) requires that Federal agencies use technical standards that are developed or adopted by voluntary consensus standards bodies unless the use of such a standard is inconsistent with applicable law or otherwise impractical. In this direct final rule, the NRC revises the TN Americas LLC Standardized NUHOMS® System design listed in § 72.214, “List of approved spent fuel storage casks.” This action does not constitute the establishment of a standard that contains generally applicable requirements.

Under the “Agreement State Program Policy Statement” approved by the Commission on October 2, 2017 and published in the Federal Register on October 18, 2017 (82 FR 48535), this rule is classified as Compatibility Category NRC—Areas of Exclusive NRC Regulatory Authority. The NRC program elements in this category are those that relate directly to areas of regulation reserved to the NRC by the Atomic Energy Act of 1954, as amended, or the provisions of 10 CFR chapter I. Therefore, compatibility is not required for program elements in this category. Although an Agreement State may not adopt program elements reserved to the NRC, and the Category “NRC” does not confer regulatory authority on the State, the State may wish to inform its licensees of certain requirements by means consistent with the particular State's administrative procedure laws.

The Plain Writing Act of 2010 (Pub. L. 111-274) requires Federal agencies to write documents in a clear, concise, and well-organized manner. The NRC has written this document to be consistent with the Plain Writing Act as well as the Presidential Memorandum, “Plain Language in Government Writing,” published June 10, 1998 (63 FR 31883).

Under the National Environmental Policy Act of 1969, as amended, and the NRC's regulations in subpart A of 10 CFR part 51, “Environmental Protection Regulations for Domestic Licensing and Related Regulatory Functions,” the NRC has determined that this direct final rule, if adopted, would not be a major Federal action significantly affecting the quality of the human environment and, therefore, an environmental impact statement is not required. The NRC has made a finding of no significant impact on the basis of this environmental assessment.

The action is to amend § 72.214 to revise the Standardized NUHOMS® System listing within the “List of approved spent fuel storage casks” to include Renewed Amendment No. 16 to Certificate of Compliance No. 1004. This amendment revises the certificate of compliance using the graded approach criteria to change the format and content of the certificate of compliance. No technical changes were made to the certificate of compliance as part of this amendment.

This direct final rule amends the certificate of compliance for the Standardized NUHOMS® System design within the list of approved spent fuel storage casks to allow power reactor licensees to store spent fuel at reactor sites under a general license. Specifically, this amendment revises the certificate of compliance to enable the use of the graded approach criteria to change the format and content of the certificate of compliance to (1) include only the information that is needed for safety, (2) move information to the appendices or the final safety analysis report such as consolidating similar programmatic or technical information in a centralized location which facilities the use of the certificate, (3) remove requirements already in 10 CFR part 72, and (4) remove duplicative information in the certificate of compliance, the appendices, or the updated final safety analysis report.

On July 18,1990 (55 FR 29181), the NRC issued an amendment to 10 CFR part 72 to provide for the storage of spent fuel under a general license in cask designs approved by the NRC. The potential environmental impact of using NRC-approved storage casks was initially analyzed in the environmental assessment for the 1990 final rule. The environmental assessment for this Renewed Amendment No. 16 tiers off of the environmental assessment for the July 18, 1990, final rule. Tiering on past environmental assessments is a standard process under the National Environmental Policy Act of 1969, as amended.

The Standardized NUHOMS® Systems are designed to mitigate the effects of design basis accidents that could occur during storage. Design basis accidents account for human-induced events and the most severe natural phenomena reported for the site and surrounding area. Postulated accidents analyzed for an independent spent fuel storage installation, the type of facility at which a holder of a power reactor operating license would store spent fuel in casks in accordance with 10 CFR part 72, can include tornado winds and tornado-generated missiles, a design basis earthquake, a design basis flood, an accidental cask drop, lightning effects, fire, explosions, and other types of incidents.

Considering the specific design requirements for each accident condition, the design of the cask would prevent loss of confinement, shielding, and criticality control in the event of an accident. If there is no loss of confinement, shielding, or criticality control, the environmental impacts resulting from an accident would be insignificant. This amendment does not reflect changes in the design or fabrication of the storage system. Because there are no design or process changes, any resulting occupational exposure or offsite dose rates from the implementation of Renewed Amendment No. 16 would remain well within the 10 CFR part 20 limits. Therefore, the proposed changes will not result in any radiological or non-radiological environmental impacts that significantly differ from the environmental impacts evaluated in the environmental assessment supporting the July 18, 1990, final rule. There will be no significant change in the types or significant revisions in the amounts of any effluent released, no significant increase in the individual or cumulative radiation exposure, and no significant increase in the potential for or consequences from radiological accidents. The NRC documented its safety findings in the preliminary safety evaluation report.

The alternative to this action is to deny approval of Renewed Amendment No. 16 and not issue the direct final rule. Consequently, any 10 CFR part 72 general licensee that seeks to load spent nuclear fuel into the TN Americas LLC Standardized NUHOMS® System in accordance with the changes described in proposed Renewed Amendment No. 16 would have to request an exemption from the requirements of §§ 72.212 and 72.214 for some of the risk-informed changes proposed. Under this alternative, interested licensees would have to prepare, and the NRC would have to review, a separate exemption request for some of these changes, thereby increasing the administrative burden upon the NRC and the costs to each licensee. The environmental impacts would be the same as the proposed action.

Approval of Renewed Amendment No. 16 to Certificate of Compliance No. 1004 would result in no irreversible commitment of resources.

No agencies or persons outside the NRC were contacted in connection with the preparation of this environmental assessment.

The environmental impacts of the action have been reviewed under the requirements in National Environmental Policy Act of 1969, as amended, and the NRC's regulations in subpart A of 10 CFR part 51, “Environmental Protection Regulations for Domestic Licensing and Related Regulatory Functions.” Based on the foregoing environmental assessment, the NRC concludes that this direct final rule entitled “List of Approved Spent Fuel Storage Casks: TN Americas LLC, Standardized NUHOMS® Horizontal Modular System, Certificate of Compliance No. 1004, Renewed Amendment No. 16” will not have a significant effect on the human environment. Therefore, the NRC has determined that an environmental impact statement is not necessary for this direct final rule.

This direct final rule does not contain any new or amended collections of information subject to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ). Existing collections of information were approved by the Office of Management and Budget, approval number 3150-0132.

The NRC may not conduct or sponsor, and a person is not required to respond to, a request for information or an information collection requirement unless the requesting document displays a currently valid Office of Management and Budget control number.

Under the Regulatory Flexibility Act of 1980 (5 U.S.C. 605(b)), the NRC certifies that this direct final rule will not, if issued, have a significant economic impact on a substantial number of small entities. This direct final rule affects only nuclear power plant licensees and TN Americas LLC. These entities do not fall within the scope of the definition of small entities set forth in the Regulatory Flexibility Act or the size standards established by the NRC (§ 2.810).

On July 18, 1990 (55 FR 29181), the NRC issued an amendment to 10 CFR part 72 to provide for the storage of spent nuclear fuel under a general license in cask designs approved by the NRC. Any nuclear power reactor licensee can use NRC-approved cask designs to store spent nuclear fuel if: (1) It notifies the NRC in advance; (2) the spent fuel is stored under the conditions specified in the cask's certificate of compliance; and (3) the conditions of the general license are met. A list of NRC-approved cask designs is contained in § 72.214. On December 22, 1994 (59 FR 65898), the NRC issued an amendment to 10 CFR part 72 that approved the Standardized NUHOMS® System design by adding it to the list of NRC-approved cask designs in § 72.214.

On June 29, 2017, as supplemented on August 31, 2017, October 13, 2017, November 16, 2017, April 26, 2018, June 7, 2018, September 3, 2019, September 6, 2019, September 10, 2019, and September 11, 2019, TN Americas LLC submitted a request to amend the Standardized NUHOMS® System as described in Section IV, “Discussion of Changes,” of this document.

The alternative to this action is to not approve the amendment, as discussed in Section VIII.D. of this document. If Renewed Amendment No. 16 is not approved, users of this design would not be able to process some changes under the provisions of § 72.48, thereby decreasing efficiency and increasing costs in the long term. To implement some of the format and content changes, users of the design would have to request an exemption from some of the requirements of §§ 72.212 and 72.214. Under this alternative, each interested 10 CFR part 72 licensee would have to prepare, and NRC would have to review, a separate exemption request, thereby increasing the administrative burden upon the NRC and the costs to each licensee.

Approval of this direct final rule is consistent with previous NRC actions. Further, as documented in the preliminary safety evaluation report and environmental assessment, this direct final rule will have no adverse effect on public health and safety or the environment. This direct final rule has no significant identifiable impact or benefit on other government agencies. Based on this regulatory analysis, the NRC concludes that the requirements of this direct final rule are commensurate with the NRC's responsibilities for public health and safety and the common defense and security. No other available alternative is believed to be as satisfactory, and therefore, this action is recommended.

The NRC has determined that the backfit rule (§ 72.62) does not apply to this direct final rule. Therefore, a backfit analysis is not required. This direct final rule revises Certificate of Compliance No. 1004 for the TN Americas LLC Standardized NUHOMS® System, as currently listed in § 72.214. The amendment consists of the changes in Renewed Amendment No. 16 previously described, as set forth in the revised certificate of compliance and technical specifications.

Renewed Amendment No. 16 to Certificate of Compliance No. 1004 for the Standardized NUHOMS® System was initiated by TN Americas LLC and was not submitted in response to new NRC requirements, or an NRC request for amendment. Renewed Amendment No. 16 applies only to new casks fabricated and used under Renewed Amendment No. 16. These changes do not affect existing users of the Standardized NUHOMS® System, and previous amendments continue to be effective for existing users. While current certificate of compliance users may comply with Renewed Amendment No. 16, this would be a voluntary decision on the part of current users.

For these reasons, Renewed Amendment No. 16 to Certificate of Compliance No. 1004 does not constitute backfitting under § 72.62 or § 50.109(a)(1), or otherwise represent an inconsistency with the issue finality provisions applicable to combined licenses in 10 CFR part 52. Accordingly, the NRC has not prepared a backfit analysis for this rulemaking.

This direct final rule is not a rule as defined in the Congressional Review Act.

The documents identified in the following table are available to interested persons through one or more of the following methods, as indicated.

The NRC may post materials related to this document, including public comments, on the Federal Rulemaking website at https://www.regulations.gov under Docket ID NRC-2019-0202. The Federal Rulemaking website allows you to receive alerts when changes or additions occur in a docket folder. To subscribe: (1) Navigate to the docket folder NRC-2019-0202; (2) click the “Sign up for Email Alerts” link; and (3) enter your email address and select how frequently you would like to receive emails (daily, weekly, or monthly).

For the reasons set out in the preamble and under the authority of the Atomic Energy Act of 1954, as amended; the Energy Reorganization Act of 1974, as amended; the Nuclear Waste Policy Act of 1982, as amended; and 5 U.S.C. 552 and 553; the NRC is adopting the following amendments to 10 CFR part 72:

Title 12 CFR part 1024 (Regulation X) generally requires servicers to obtain a complete loss-mitigation application before evaluating a mortgage borrower for a loss-mitigation option, such as a loan modification or short sale. 1 Regulation X provides an exception from this requirement for certain short-term loss mitigation options. 2 Due to the particular needs of mortgage servicers and borrowers during the novel coronavirus disease (COVID-19) pandemic emergency (COVID-19 emergency), the Bureau is amending Regulation X to temporarily permit mortgage servicers to offer certain loss mitigation options without obtaining a complete loss mitigation application. Servicers may offer eligible loss mitigation options to a borrower who has received a payment forbearance program made available to borrowers experiencing a financial hardship due, directly or indirectly, to the COVID-19 emergency, including one offered pursuant to section 4022 of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), 3 or who has had other principal and interest payments that are due and unpaid as a result of a financial hardship due, directly or indirectly, to the COVID-19 emergency.

The amendment conditions eligibility for the new exception on the loss mitigation option satisfying three criteria. First, the loss mitigation option must permit the borrower to delay paying certain amounts until the mortgage loan is refinanced, the mortgaged property is sold, the term of the mortgage loan ends, or, for a mortgage insured by FHA, the mortgage insurance terminates. These amounts include, without limitation, all principal and interest payments forborne under a payment forbearance program made available to borrowers experiencing a financial hardship due, directly or indirectly, to the COVID-19 emergency, including one made pursuant to the Coronavirus Economic Stabilization Act, section 4022 (15 U.S.C. 9056). These amounts also include, without limitation all other principal and interest payments that are due and unpaid by a borrower experiencing financial hardship due, directly or indirectly, to the COVID-19 emergency. For purposes of this criterion, the term of the mortgage loan means the term of the mortgage loan according to the obligation between the parties in effect when the borrower is offered the loss mitigation option. Second, any amounts that the borrower may delay paying through the loss mitigation option do not accrue interest; the servicer does not charge any fee in connection with the loss mitigation option; and the servicer waives all existing late charges, penalties, stop payment fees, or similar charges promptly upon the borrower's acceptance of the loss mitigation option. Third, the borrower's acceptance of the loss mitigation offer must resolve any prior delinquency. These criteria maintain important protections for borrowers and are intended to align with the COVID-19 payment deferral option announced by the Federal Housing Finance Agency (FHFA), discussed in part II, and other similar programs.

The interim final rule also excludes servicers from certain regulatory requirements if a borrower accepts an option offered pursuant to the new exception. Specifically, the interim final rule provides that the servicer is not required to continue the reasonable diligence efforts § 1024.41(b)(1) otherwise requires or send the acknowledgement notice § 1024.41(b)(2) otherwise requires.

In February 2013, the Bureau issued the Mortgage Servicing Rules to implement the Real Estate Settlement Procedures Act of 1974, 4 and included these rules in Regulation X. 5 The Bureau later clarified and revised Regulation X's servicing rules through several additional notice-and-comment rulemakings. 6 In part, these rulemakings were intended to address deficiencies in servicers' handling of delinquent borrowers and loss mitigation applications during and after the 2008 financial crisis. 7 When the housing crisis began, servicers were faced with historically high numbers of delinquent mortgages, loan modification requests, and in-process foreclosures in their portfolios. 8 Many servicers lacked the infrastructure, trained staff, controls, and procedures needed to manage effectively the flood of delinquent mortgages they were obligated to handle. 9 Inadequate staffing and procedures led to a range of reported problems with servicing of delinquent loans, including some servicers misleading borrowers, failing to communicate with borrowers, losing or mishandling borrower-provided documents supporting loan modification requests, and generally providing inadequate service to delinquent borrowers. 10

The Bureau's mortgage servicing rules addressed these concerns by establishing procedures that mortgage servicers generally must follow in evaluating loss mitigation applications submitted by mortgage borrowers. 11 Among other things, as relevant here, Regulation X generally requires servicers to obtain a complete loss-mitigation application from a borrower before offering the borrower a loss-mitigation option, such as a loan modification or short sale. 12 Servicers generally may not offer a loss-mitigation option based upon an evaluation of any information provided in connection with an incomplete application. 13 The loss mitigation provisions were motivated in part by concerns that some servicers were doing an inadequate job of communicating with borrowers regarding loss mitigation options, 14 and that some servicers were unwilling to work with borrowers to reach agreement on loss mitigation options. 15 The Bureau intended this restriction to help ensure that borrowers have a full and fair opportunity to be evaluated for loss mitigation options. 16

However, in issuing these requirements, the Bureau recognized that more flexible requirements may be warranted when borrowers are facing certain hardships. For example, Regulation X provides flexibility for servicers when they offer short-term payment forbearance programs or short-term repayment plans, as defined in Regulation X, based upon an evaluation of an incomplete application. 17 In granting this flexibility, the Bureau explained that borrowers facing only temporary hardships might benefit from a more efficient application process that leads to a temporary solution without exhausting the protections under § 1024.41 that are determined as of the date a complete application is received. 18

By late March 2020, the COVID-19 emergency was significantly affecting the economy. Between March 15 and May 15, 2020, over 35 million people filed initial jobless claims, and the unemployment rate climbed to over 14 percent in April—the highest monthly level since 1948 when the Bureau of Labor and Statistics started tracking this series. 19

On March 27, 2020, the CARES Act was enacted. Among other things, the CARES Act ensures that borrowers experiencing a financial hardship due, directly or indirectly, to the COVID-19 emergency and who have “Federally backed mortgage loans”  20 have access to payment forbearance programs (CARES Act forbearance) if they submit a request to their mortgage servicer and affirm that they are experiencing a financial hardship during the COVID-19 emergency. 21 By requiring servicers to grant CARES Act forbearances to certain borrowers with federally backed mortgages (which account for approximately 80 percent of mortgage borrowers), the CARES Act established payment forbearance as the primary tool that servicers of these loans would use initially to assist struggling borrowers during the COVID-19 emergency. The Bureau understands that servicers of other mortgages that are not “Federally backed mortgage loans” under the CARES Act may be offering similar payment forbearance programs to their borrowers. 22

On April 3, 2020, the Bureau, the Board of Governors of the Federal Reserve System (the Board), the Federal Deposit Insurance Corporation (FDIC), the National Credit Union Administration (NCUA), the Office of the Comptroller of the Currency (OCC), and the State Banking Regulators issued a joint statement (Joint Statement) recognizing the serious impact the COVID-19 emergency was having on consumers and on the operations of mortgage servicers. 23 The Joint Statement informed servicers of the agencies' flexible supervisory and enforcement approach during the emergency regarding certain consumer communications required by Regulation X, and provided guidance on servicers' compliance with Regulation X when offering CARES Act forbearances and other payment forbearance programs during the COVID-19 emergency. 24 The Joint Statement explained that, when a borrower requests a CARES Act forbearance and affirms that the borrower is experiencing a financial hardship during the COVID-emergency, it constitutes an incomplete loss mitigation application for purposes of Regulation X. 25 Although receipt of an incomplete application generally triggers a servicer's obligations under § 1024.41, the Joint Statement also provided that a CARES Act forbearance qualifies as a short-term payment forbearance program  26 under Regulation X, so certain loss mitigation requirements under Regulation X do not apply. 27

By early June 2020, as a result of the CARES Act and other similar forbearance programs made available by owners or investors of mortgage loans, as many as 4.3 million mortgage borrowers (or 8.55 percent of mortgage borrowers) nationwide were in forbearance programs. 28 After reaching a historic low in January of 2020 (just above 3 percent), the mortgage delinquency rate (which includes loans in forbearance) had more than doubled by early June and was at its highest level since 2013. The delinquency rate was 3.1 percentage points higher in April than in March—a monthly increase three times the previous record set in November of 2008 during the great recession. 29

The CARES Act does not specify how borrowers receiving CARES Act forbearances must repay the forborne payments. While there are good reasons for this, it creates uncertainty for stakeholders as to how borrowers must repay these amounts when CARES Act forbearances expire. As many initial forbearance periods were set at 90 days, many of them will expire in June or July 2020.

The Federal National Mortgage Association (Fannie Mae), Federal Home Loan Mortgage Company (Freddie Mac), FHA, and other owners or insurers of mortgage loans have announced programs to assist borrowers in repayment of the forborne amounts. 30 On May 13, 2020, FHFA announced that Fannie Mae and Freddie Mac would make a payment deferral program available to borrowers in a COVID-19 forbearance plan (FHFA COVID-19 payment deferral) and to borrowers who have experienced a financial hardship resulting from COVID-19 that has affected their ability to make their full monthly payment. 31 FHFA indicated that these programs will be available to borrowers who are able to return to making their normal monthly mortgage payment. 32 According to FHFA, these programs take the missed mortgage payments and make them a payment due at the sale of the home, refinancing of the mortgage loan, or the end of the loan. 33 Fannie Mae and Freddie Mac have established streamlined application procedures for these programs that permit servicers to offer an FHFA COVID-19 payment deferral without collecting Fannie Mae's and Freddie Mac's “complete Borrower Response Package.”  34 Rather, Fannie Mae and Freddie Mac permit servicers to offer FHFA COVID-19 payment deferrals to any borrowers who meet certain criteria if the borrower indicates to the servicer that (1) the borrower can afford to resume their normal monthly payments due before the forbearance and (2) the borrower cannot afford full reinstatement or a repayment plan to bring their mortgage loan current when they exit forbearance. 35 Fannie Mae and Freddie Mac prohibit servicers from charging borrowers who accept an FHFA COVID-19 payment deferral administrative fees, and direct servicers to waive all late charges, penalties, stop payment fees, or similar charges upon completing a COVID-19 payment deferral. 36 This program takes effect on July 1, 2020. 37 Other mortgage investors and insurers have also announced similar loss mitigation options. 38

After FHFA announced these deferral programs, industry stakeholders and consumer advocates raised concerns about whether servicers could offer an FHFA COVID-19 payment deferral using the streamlined application procedures described above without violating Regulation X's general prohibition of offering a loss mitigation option based on an evaluation of an incomplete application. 39 The Bureau has evaluated the interaction between the FHFA payment deferral procedures and Regulation X, and engaged in informal outreach with FHFA, mortgage servicers, trade associations, consumer advocacy groups, and others. Industry stakeholders and consumer advocates urged the Bureau to take steps to ensure that servicers would not be in violation of Regulation X if they were to use the streamlined procedures.

The Bureau supports the goal of the FHFA's COVID-19 payment deferral program and certain other similar programs designed to assist borrowers experiencing financial hardships due, directly or indirectly, to the COVID-19 emergency. Through these programs, eligible borrowers can eliminate the immediate potential risk of losing their homes, resume repaying the mortgage loan with no delinquency and no additional fees or interest, and better plan how eventually to repay the forborne amount that servicers have deferred. In addition, the streamlined application procedures offered by Fannie Mae, Freddie Mac, and others may help ensure that servicers have sufficient resources to address the unusually large number of borrowers who will be exiting CARES Act or similar forbearances and may be seeking assistance in the coming months. There are circumstances where Regulation X may require a servicer to collect a complete application from a borrower before offering this type of program. However, that result may not serve the particular needs of borrowers and servicers during the COVID-19 emergency.

For these and the reasons discussed below, the Bureau is amending Regulation X to specify that servicers may offer loss mitigation options that meet certain criteria based on the evaluation of an incomplete application, and that servicers need not comply with certain other Regulation X requirements once the borrower accepts that option. These criteria are intended to align with the criteria outlined in FHFA's COVID-19 payment deferral and other comparable programs, such as FHA's COVID-19 partial claim.

The Bureau believes that this flexibility is appropriate during the COVID-19 emergency, which presents extraordinary circumstances. The Bureau will evaluate comments received under the interim final rule to determine whether it is appropriate to revise the amendments. The Bureau will also continue to monitor the market to assess consumers' experiences under these programs and the interim rule.

As part of this rulemaking, the Bureau consulted with FHFA, the Board, FDIC, NCUA, OCC, and the Department of Housing and Urban Development.

The Bureau is issuing this interim final rule pursuant to its authority under RESPA and the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), 40 including the authorities discussed below. This interim final rule amends a provision previously adopted by the Bureau in the 2016 Mortgage Servicing Final Rule. 41 In doing so, the Bureau relied on one or more of the authorities discussed below, as well as other authority. The Bureau is issuing this interim final rule in reliance on the same authority and for the same reasons relied on in adopting the relevant provisions of the 2013 Mortgage Servicing Final Rule, 42 as discussed in detail in the Legal Authority and Section-by-Section Analysis of the 2013 Mortgage Servicing Final Rule.

Section 19(a) of RESPA, 12 U.S.C. 2617(a), authorizes the Bureau to prescribe such rules and regulations, to make such interpretations, and to grant such reasonable exemptions for classes of transactions, as may be necessary to achieve the purposes of RESPA, which include its consumer protection purposes. In addition, section 6(j)(3) of RESPA, 12 U.S.C. 2605(j)(3), authorizes the Bureau to establish any requirements necessary to carry out section 6 of RESPA, section 6(k)(1)(E) of RESPA, and 12 U.S.C. 2605(k)(1)(E), and authorizes the Bureau to prescribe regulations that are appropriate to carry out RESPA's consumer protection purposes. The consumer protection purposes of RESPA include ensuring that servicers respond to borrower requests and complaints in a timely manner and maintain and provide accurate information, helping borrowers avoid unwarranted or unnecessary costs and fees and facilitating review for foreclosure avoidance options. The amendments to Regulation X in this interim final rule are intended to achieve some or all these purposes.

Section 1022(b)(1) of the Dodd-Frank Act, 12 U.S.C. 5512(b)(1), authorizes the Bureau to prescribe rules “as may be necessary or appropriate to enable the Bureau to administer and carry out the purposes and objectives of the Federal consumer financial laws, and to prevent evasions thereof.” RESPA is a Federal consumer financial law.

Under the Administrative Procedure Act, 43 notice and opportunity for public comment are not required if the Bureau for good cause finds that notice and public comment are impracticable, unnecessary, or contrary to the public interest. 44 Similarly, publication of this interim final rule at least 30 days before its effective date is not required where the Bureau has identified good cause for a different effective date. 45

The Bureau finds that prior notice and public comment are impracticable because there is insufficient time to solicit comment and finalize amendments between the FHFA's announcement of its COVID-19 payment deferral program on May 13, 2020, and its effective date of July 1, 2020. As discussed more fully in part II, the economic effects of the COVID-19 emergency have resulted quickly in major challenges in the mortgage market. Congress enacted the CARES Act in late March, making forbearances available to many borrowers with federally backed mortgages, which account for approximately 80 percent of the mortgage market.

Because the CARES Act does not specify how borrowers provided CARES Act forbearances will repay the forborne payments, Fannie Mae, Freddie Mac, FHA, and other owners or insurers of mortgage loans worked quickly after they placed borrowers in these forbearances to devise loss mitigation options for borrowers who could not afford to repay the forborne amounts in a lump sum at the conclusion of the forbearance period. FHFA, Fannie Mae, and Freddie Mac announced a COVID-19 post-forbearance program, the COVID-19 payment deferral, on May 13, 2020. 46 These programs take effect on July 1, 2020, and, because significant numbers of borrowers entered 90-day forbearances in late March and early April, this coincides with when many borrowers' forbearance periods will end. Thus, starting on July 1, 2020—absent immediate action by the Bureau—servicers would have to reconcile FHFA's COVID-19 payment deferral programs with the anti-evasion requirement in the servicing rules. As a practical matter, servicers would not be able to offer the payment deferral to some borrowers without first having them complete their loss mitigation applications, a step that would delay or obstruct relief to borrowers and frustrate the purpose and immediate need for the program. 47 It is critical that the Bureau's temporary revision to Regulation X be in effect when these forbearance programs take effect to ensure that borrowers and mortgage servicers can take advantage of these programs.

Thus, prior public comment is impractical because there is insufficient time to solicit comment and finalize amendments before FHFA's COVID-19 payment deferral programs take effect on July 1, 2020.

For similar reasons, the Bureau also finds that delaying this rulemaking to allow for prior public comment would be contrary to the public interest, because the amendments are necessary to avoid the harm to borrowers and to the housing market that would result if the amendments did not take effect on July 1, 2020. As discussed above in part II, the Bureau believes that the FHFA COVID-19 payment deferral program and other comparable programs, described more fully in part V, will benefit both borrowers and servicers during the current COVID-19 emergency. These programs will help eligible borrowers avoid foreclosure by quickly entering an agreement regarding repayment of their forborne payments. Absent these streamlined procedures, servicers likely would require borrowers to submit a complete loss mitigation application before servicers would consider them for these programs. This could result in significant delays before borrowers can be offered the payment deferral program. In some cases, borrowers might not complete a loss mitigation application, which could prolong their delinquency, increase their costs, and put them at imminent risk of foreclosure. Given the large number of mortgage borrowers currently in forbearance or experiencing a delinquency related to the COVID-19 emergency, even a small fraction of those borrowers experiencing foreclosure could translate to large aggregate consequences. For instance, as noted above, approximately four million borrowers have entered forbearance since March 2020. Even if only one-tenth of 1 percent of these borrowers would experience foreclosure absent a deferral, that would translate to thousands of additional foreclosures. Thus, avoiding foreclosures may help prevent significant consequences for the housing market and imposing costs both on borrowers and servicers.

In addition, the streamlined procedures permitted for FHFA's COVID-19 payment deferral program would minimize the burden on servicers by allowing them to offer the payment deferral program without obtaining and processing a complete application from the borrower. This is especially important during the COVID-19 emergency because servicers will be transitioning many borrowers from forbearances to longer term solutions at the same time, potentially overwhelming servicers' systems and delaying providing relief to borrowers. Indeed, the Bureau understands that servicers have already begun receiving abnormally high call volumes, beginning in March 2020. 48

For these same reasons, the Bureau also finds that there is good cause for this interim final rule to be effective less than 30 days after publication, to ensure that these amendments are in effect by the July 1, 2020 effective date of the FHFA COVID-19 payment deferral, to avoid harm to borrowers and to the housing market.

Section 1024.41(c)(2)(i) states that, in general, servicers shall not evade the requirement to evaluate a complete loss mitigation application for all loss mitigation options available to the borrower by making an offer based upon an incomplete application. 49 Currently, the provision points to two paragraphs providing exceptions to the anti-evasion requirement, § 1024.41(c)(2)(ii) and (iii). In this interim final rule, the Bureau is adding a temporary exception under new § 1024.41(c)(2)(v). As described in the section-by-section analysis of § 1024.41(c)(2)(v), the new exception applies to certain loss mitigation options that permit borrowers to delay repayment of forborne or delinquent amounts accrued due to the COVID-19 emergency. The Bureau is amending § 1024.41(c)(2)(i) to include a reference to the new exception in paragraph (c)(2)(v).

In general, § 1024.41 requires servicers to evaluate a complete loss mitigation application for all loss mitigation options available to the borrower. 50 In this interim final rule, the Bureau is adding a temporary exception to this requirement under new § 1024.41(c)(2)(v) for certain loss mitigation options that permit borrowers to delay repayment of forborne or delinquent amounts accrued during a COVID-19-related forbearance. As described in the respective section-by-section analyses, new § 1024.41(c)(2)(v)(A) sets forth the minimum specific criteria that the loss mitigation option must meet for the new exception to apply, and new § 1024.41(c)(2)(v)(B) offers servicers relief from certain regulatory requirements when a borrower accepts a loss mitigation option under the new exception.

As discussed in part II, FHFA, FHA, and others have recently announced loss mitigation options to assist borrowers experiencing hardships related to the COVID-19 emergency in repaying amounts that accrued through forbearance or delinquency. 51 In general, these programs permit borrowers who can resume their normal periodic payments to move the forborne or delinquent payments to the end of the mortgage loan and cure any preexisting delinquency. Under those programs, the deferred amounts must not accrue interest, servicers may not charge any fee in connection with the loss mitigation option and must waive various preexisting fees, if applicable, and servicers are permitted to offer the deferral programs to borrowers based on streamlined application procedures.

The Bureau believes that the FHFA COVID-19 payment deferral and certain similar programs would provide benefits both to borrowers and servicers during the COVID-19 emergency. Through these programs, borrowers who can resume their normal periodic payments but who cannot afford to repay the forborne or delinquent amounts in the short-term should be able to eliminate the immediate potential risk of losing their homes to foreclosure, resume repaying the mortgage loan with no delinquency and no additional fees or interest, and better plan how eventually to repay the forborne or delinquent amount that has been deferred.

In addition, the streamlined application procedures authorized by Fannie Mae and Freddie Mac should help ensure that servicers have sufficient resources to address requests from the unusually large number of borrowers who will be seeking assistance from them in the coming months as many CARES Act forbearances end. And borrowers dealing with the social and economic effects of COVID-19 may be less likely than they would be under normal circumstances to take the steps necessary to complete a loss mitigation application to receive a full evaluation. This could prolong their delinquencies and put them at risk for foreclosure. Moreover, by allowing servicers to assist borrowers eligible for deferrals more efficiently, servicers will have more resources to assist borrowers who are unable to resume making their normal periodic payment, and are therefore ineligible for a FHFA COVID-19 payment deferral, submit a complete loss mitigation application for evaluation.

The Bureau acknowledges that borrowers accepting a loss mitigation offer under new § 1024.41(c)(2)(v)(A) will not receive protections under § 1024.41 that are critical in other circumstances. As the Bureau explained in the 2013 Mortgage Servicing Final Rule, the general prohibition against evaluating a borrower for all available loss mitigation options based on a single, complete application ensures that borrowers have a full understanding of their loss mitigation options when deciding on a program. 52 It also makes the loss mitigation application process more efficient by eliminating multiple, sequential evaluations that are sometimes based on similar application information, 53 with the resulting efficiency often saving borrowers time and resources.

Nonetheless, the Bureau believes that the protections set forth in new § 1024.41(c)(2)(v)(A) and (B), described below, provide sufficient safeguards for borrowers in the narrow context of the COVID-19 emergency. The Bureau solicits comment on all aspects of the new exception.

New § 1024.41(c)(2)(v)(A) permits servicers to offer a loss mitigation option based upon an evaluation of an incomplete application, as long as the loss mitigation option meets the criteria set forth in § 1024.41(c)(2)(v)(A)( 1 ) through ( 3 ). Under new § 1024.41(c)(2)(v)(A)( 1 ), the loss mitigation option must permit the borrower to delay paying covered amounts until the mortgage loan is refinanced, the mortgaged property is sold, the term of the mortgage loan ends, or, for a mortgage insured by FHA, the mortgage insurance terminates. New § 1024.41(c)(2)(v)(A)( 1 ) defines “covered amounts” for these purposes to include, without limitation, all principal and interest payments forborne under a payment forbearance program made available to borrowers experiencing a financial hardship due, directly or indirectly, to the COVID-19 emergency, 54 including a payment forbearance program made pursuant to the CARES Act. “Covered amounts” under § 1024.41(c)(2)(v)(A)( 1 ) also includes, without limitation, all other principal and interest payments that are due and unpaid by a borrower experiencing a similar financial hardship. And “the term of the mortgage loan” under § 1024.41(c)(2)(v)(A)( 1 ) means the loan term according to the obligation between the parties in effect when the borrower is offered the loss mitigation option under the new exception.

Under new § 1024.41(c)(2)(v)(A)( 2 ), any amounts that the borrower may delay paying as described in paragraph (c)(v)(2)(A)( 1 ) must not accrue interest; the servicer must not charge any fee in connection with the loss mitigation option; and the servicer must waive all existing late charges, penalties, stop payment fees, or similar charges promptly upon the borrower's acceptance of the loss mitigation option. And, under § 1024.41(c)(2)(v)(A)( 3 ), the borrower's acceptance of the offer must end any preexisting delinquency.

The criteria in § 1024.41(c)(2)(v)(A)( 1 ) through ( 3 ) provide borrowers with safeguards to ensure that borrowers are sufficiently protected when receiving a loss mitigation offer described in § 1024.41(c)(2)(v)(A) without an evaluation of a complete loss mitigation application. First, to qualify for the exception, new § 1024.41(c)(2)(v)(A)( 1 ) requires that any forborne or delinquent principal or interest payments be moved to the end of the loan or, for loans that FHA insures, until the mortgage insurance terminates. This ensures that borrowers in forbearance programs will not face a balloon payment immediately after the forbearance period ends, and it will ease the financial strain of having to make additional periodic payments to catch up on a mortgage loan for delinquent borrowers who are not in forbearance. The alternatives could exacerbate borrowers' hardships and lead to foreclosure. As a result of the eligibility criteria under new § 1024.41(c)(2)(v)(A)( 1 ), many borrowers receiving a loss mitigation option under § 1024.41(c)(2)(v)(A) will have years to plan to address the deferred payments. This may be particularly important during the COVID-19 emergency, as many borrowers may be facing extended periods of economic uncertainty.

The Bureau notes that new § 1024.41(c)(2)(v)(A)( 1 ) allows for some flexibility among loss mitigation options that may qualify for the exception. For example, although the loss mitigation options must defer all forborne or delinquent principal and interest payments under new § 1024.41(c)(2)(v)(A)( 1 ), the rule does not specify how servicers must treat any forborne or delinquent escrow amounts. A loss mitigation option would qualify for the new exception if it defers repayment of escrow amounts, in addition to principal and interest payments, as long as it otherwise satisfies new § 1024.41(c)(2)(v)(A).

New § 1024.41(c)(2)(v)(A)( 1 ) is also flexible with respect to repayment requirements—it does not specify how a servicer must structure repayment of the deferred amounts. Requiring repayment either in a lump sum or over a specified period at the end of the loan term through additional periodic payments, among other possible approaches, would satisfy new § 1024.41(c)(2)(v)(A)( 1 ). The Bureau notes that the provision specifically defines the mortgage loan term for these purposes to mean the loan term in effect when the borrower is offered the loss mitigation option. As a result, the exception under new § 1024.41(c)(2)(v)(A) is available for eligible loss mitigation options that would technically extend the term of the loan in accommodating repayment of forborne or delinquent amounts.

The Bureau also notes that new § 1024.41(c)(2)(v)(A)( 1 ) provides a standard specific to loans insured by FHA. This is intended to ensure that the new exception extends to certain loss mitigation options available for FHA loans. The Bureau understands that FHA permits servicers to offer loss mitigation options that would otherwise satisfy the criteria of § 1024.41(c)(2)(v)(A) based on an evaluation of an incomplete loss mitigation application, and that these options would generally provide similar benefits to borrowers and servicers as other loss mitigation options offered under § 1024.41(c)(2)(v)(A). In some circumstances, these loss mitigation options would require repayment when the mortgage insurance terminates. The FHA-specific standard in new § 1024.41(c)(2)(v)(A)( 1 ) ensures that such repayment requirements do not exclude these loss mitigation options from the new exception.

Second, for the exception to apply, new § 1024.41(c)(2)(v)(A)( 2 ) requires that (1) any amounts that the borrower may delay paying as part of the loss mitigation agreement do not accrue interest, (2) the servicer charges no fee in connection with the loss mitigation option, and (3) the servicer waives a variety of other fees promptly upon the borrower's acceptance. This requirement will prevent the application of standards that impose additional economic hardship on borrowers, better enabling the borrowers to address other financial needs during the COVID-19 emergency.

Third, for the exception to apply, new § 1024.41(c)(2)(v)(A)( 3 ) requires that the borrower's acceptance of the offer end any preexisting delinquency. 55 This ensures that borrowers who accept a loss mitigation option under new § 1024.41(c)(2)(v)(A) do not face a risk of imminent foreclosure because, under existing § 1024.41(f)(1)(i), servicers are generally prohibited from making the first notice or filing required under applicable law to initiate the foreclosure process until a mortgage loan obligation is more than 120 days delinquent.

The Bureau understands that the FHFA COVID-19 payment deferral and FHA's COVID-19 partial claim, both of which are described in part II, satisfy the criteria in new § 1024.41(c)(2)(v)(A)( 1 ) through ( 3 ). These programs have included these criteria to assist borrowers in addressing financial hardships caused by the COVID-19 emergency, in part by helping to keep their mortgage loans current following the hardship. 56 The Bureau notes, however, that the exception is not limited to those programs. Servicers may offer loss mitigation options under other programs, as long as the loss mitigation options meet the criteria described in § 1024.41(c)(2)(v)(A).

New § 1024.41(c)(2)(v)(B) provides servicers relief from certain regulatory requirements if a borrower accepts an offer made pursuant to new § 1024.41(c)(2)(v)(A). It states that, in that scenario, the servicer is not required to comply with § 1024.41(b)(1) or (2) with regard to any loss mitigation application the borrower submitted prior to the servicer's offer of the loss mitigation option described in new § 1024.41(c)(2)(v)(A).

Section 1024.41(b)(1) and (2) generally sets forth servicers' obligations upon first receiving a borrower's loss mitigation application. Section 1024.41(b)(1) generally requires a servicer to exercise reasonable diligence in obtaining documents and information to complete the loss mitigation application. Section 1024.41(b)(2) generally requires the servicer to review the application to assess completeness and provide a written notice within five days (excluding legal public holidays, Saturdays, and Sundays) stating, among other things, that the servicer has determined that the loss mitigation application is either complete or incomplete; the additional documents and information the borrower must submit to make the application complete, if applicable; a reasonable date by which the borrower should submit the additional documents and information; and a statement that the borrower should consider contacting servicers of any other mortgage loans secured by the same property to discuss available loss mitigation options.

These protections are part of a regulatory regime designed to ensure that borrowers generally receive an evaluation for all available loss mitigation options based upon a single application. As explained in the section-by-section analysis of new § 1024.41(c)(2)(v)(A), this regulatory regime is intended to give borrowers information about their loss mitigation options when deciding on a program and make the application process more efficient, which can save borrowers time and resources.

Notwithstanding these important benefits, however, the Bureau believes that, in the context of a loss mitigation offer under new § 1024.41(c)(2)(v)(A), the protections under § 1024.41(b)(1) and (2) introduce undue burden for both servicers and borrowers attempting to navigate the unusual challenges caused by the COVID-19 emergency. Servicers are currently dealing with an abnormally high number of requests for loss mitigation assistance due to the pandemic. According to the Mortgage Bankers Association (MBA), between early March and early June 2020, approximately four million borrowers entered into forbearance programs. 57 Over that period, the percentage of all mortgage loans in forbearance increased from 0.19 percent to 8.55 percent. 58 If servicers were required to exercise reasonable diligence to obtain a complete application for each of these borrowers when they exit the forbearance programs, as required under § 1024.41(b)(1), or to provide borrower-specific notifications of the documents and information each individual applicant must submit to complete the application, as required under § 1024.41(b)(2), it would likely interfere with their ability to provide effective and efficient assistance. And borrowers dealing with the social and economic effects of the COVID-19 emergency may be less likely than normal to take the steps necessary to complete a loss mitigation application to receive a full evaluation. The Bureau notes that, if a borrower does wish to pursue a complete application and receive the full protections of § 1024.41, they may do so notwithstanding new § 1024.41(c)(2)(v).

The Bureau stresses that servicers are required to comply with § 1024.41, including § 1024.41(b)(1) and (2), if the borrower submits a new application after accepting a loss mitigation option under new § 1024.41(c)(2)(v)(A). In general, servicers are required to comply with § 1024.41 if a borrower submits a loss mitigation application, unless the servicer has previously complied in connection with a complete application submitted by the borrower and the borrower has been delinquent at all times since submitting that complete application. 59 If a borrower has accepted a loss mitigation option offered under new § 1024.41(c)(2)(v)(A), neither of these elements will be present the first time the borrower submits a later loss mitigation application. The exception described under new § 1024.41(c)(2)(v)(A) is available only if the loss mitigation application is incomplete and, under new § 1024.41(c)(2)(v)(A)( 3 ), the borrower's acceptance of the option ends any preexisting delinquency of the borrower's mortgage loan account. As a result, servicers must comply with the requirements of § 1024.41 for the first later application, which may occur during the same conversation in which the borrower accepts the offer under § 1024.41(c)(2)(v)(A).

Additionally, servicers may be required to comply with early intervention obligations if a borrower's mortgage loan account becomes delinquent after a loss mitigation option takes effect under § 1024.41(c)(2)(v)(A). 60 These include live contact and written notification obligations that, in part, require servicers to inform borrowers of the availability of additional loss mitigation options and how the borrowers can apply. 61

Further, the Bureau believes that a borrower whose mortgage loan account becomes delinquent following acceptance of a loss mitigation option under § 1024.41(c)(2)(v)(A) will have sufficient notice that other options may be available should the borrower wish to submit another application. In general, borrowers who previously received a forbearance will have received at least two written notifications earlier in the loss mitigation process, as required under Regulation X: (1) The written notice required under § 1024.41(b)(2) when the borrower submits the initial application requesting forbearance, and (2) written notification of the terms and conditions of the forbearance program, required under § 1024.41(c)(2)(iii), stating that the servicer offered the program based on evaluation of an incomplete application, that other loss mitigation options may be available, and that the borrower still has the option to submit a complete application to receive an evaluation for all available options. 62 Additionally, many borrowers receiving an offer under § 1024.41(c)(2)(v)(A) are likely to have received early intervention efforts by their servicers, including the written notice required under Regulation X stating, among other things, a brief description of examples of loss mitigation options that may be available, as well as application instructions or a statement informing the borrower how to obtain more information about loss mitigation options from the servicer. 63

In light of these protections, as well as the safeguards set forth in new § 1024.41(c)(2)(v)(A), the Bureau believes the requirements of § 1024.41(b)(1) and (2) would introduce burden for servicers and borrowers that is unnecessary in this limited context.

The Bureau invites comment on this interim final rule. The Bureau is particularly interested in whether the amendments appropriately balance providing flexibility to servicers to offer relief quickly during the COVID-19 emergency with providing important protections for borrowers engaged in the loss mitigation application process, such as protections from foreclosure. The Bureau also seeks comment on whether to require written disclosures for this, or any similar exceptions that the Bureau may authorize in the future. The Bureau also seeks comment on whether the Bureau should extend the exception established in new § 1024.41(c)(3)(v) to other post-forbearance loss mitigation options made available to borrowers affected by other types of disasters and emergencies.

This interim final rule is effective on July 1, 2020.

In developing this interim final rule, the Bureau has considered the potential benefits, costs, and impacts as required by section 1022(b)(2) of the Dodd-Frank Act. 64 In developing this interim final rule, the Bureau has consulted with appropriate Federal agencies regarding the consistency of this final rule with prudential, market, or systemic objectives administered by such agencies as required by section 1022(b)(2)(B) of the Dodd-Frank Act. 65

The Bureau considered the benefits, costs, and impacts of this interim final rule against a baseline in which the Bureau takes no action. The baseline under this approach includes the CARES Act and the forbearances that have already been granted under the CARES Act and substantially similar programs. 66

In considering the relevant potential benefits, costs, and impacts of this interim final rule, the Bureau has used feedback received to date and its knowledge of consumer financial markets. The discussion below of these potential costs, benefits, and impacts is partly qualitative, reflecting the specialized nature of the amendments. The Bureau requests comment on this discussion generally, as well as the submission of data or other information that could inform the Bureau's consideration of the potential benefits, costs, and impacts of the interim final rule.

The interim final rule's provisions generally would decrease burden incurred by industry participants and benefit consumers by providing a limited exception to the general requirement under § 1024.41 for borrowers to submit a complete loss mitigation application before servicers may offer any loss mitigation option based on the evaluation of an incomplete application. Under the interim final rule, this limited exception would be available for loss mitigation options that permit payments forborne under an eligible forbearance, as well as payments that are due and unpaid, related to the COVID-19 emergency to be deferred to the end of the mortgage loan. As is described in more detail below, the Bureau does not believe that these changes would restrict consumer access to consumer financial products and services relative to what would occur under the baseline.

Exception to Regulation X anti-evasion provision allowing FHFA COVID-19 payment deferrals without a complete loss mitigation application. The interim final rule revises § 1024.41(c)(2)(i) and adds § 1024.41(c)(2)(v) to allow servicers to offer a payment deferral, or a similar loss mitigation option in certain circumstances based on the evaluation of an incomplete loss mitigation application. In general, for the exception to apply, borrowers must already have received a forbearance or delinquency related to the COVID-19 emergency, the forborne or delinquent payments must be deferred to the end of the mortgage loan without accruing interest and with a variety of fees waived, and the borrower's acceptance must end any preexisting delinquency. The Bureau understands that the FHFA COVID-19 payment deferral and FHA's COVID-19 partial claim satisfy the criteria, although the interim final rule is not limited to these programs.

As noted above, § 1024.41(c)(2)(i), in part, prohibits evasion of the requirement for servicers to evaluate borrowers for all available loss mitigation options in a single application once they have received a complete application. In the 2013 Mortgage Servicing Final Rule, the Bureau explained its view that borrowers would benefit from this requirement, in part because borrowers would generally be better able to choose among available loss mitigation options if they are presented simultaneously. This interim final rule is unlikely to affect this benefit in most cases, given the narrow scope and particular circumstances of the exception. Even if a borrower may be interested in and eligible for another form of loss mitigation besides a deferral, receiving a deferral would not generally remove the borrower's right under § 1024.41 to submit a complete loss mitigation application and receive an evaluation for all available options after the deferral is in place. Moreover, in the specific case of the FHFA COVID-19 payment deferral program, in practice, the incomplete applications that may result in deferrals will generally be created as a result of servicer outreach specifically for the purposes of granting a deferral: Fannie Mae and Freddie Mac have directed their servicers to proactively reach out to borrowers currently under a CARES Act forbearance and to grant deferrals to all eligible borrowers. 67 Further, to be eligible for the exception under new § 1024.41(c)(2)(v)(A), a loss mitigation option must bring the loan current. In most cases, borrowers must be more than 120 days delinquent before a servicer may make the first notice or filing required under applicable law to initiate foreclosure proceedings. 68 Thus, if a borrower wishes to pursue another loss mitigation option after accepting the deferral, the borrower will still have a considerable amount of time to complete a loss mitigation application before they would be at risk for foreclosure. In summary, in these specific circumstances, the Bureau believes that allowing servicers to grant deferrals without a complete loss mitigation application will not materially affect borrowers' ability to choose among available loss mitigation options.

Borrowers will likely benefit from the new exception to the extent that they are more able to receive a payment deferral without having to submit a complete loss mitigation application. In most cases, this will result in a reduction in the time necessary to gather required documents and information. In some cases, if borrowers would not otherwise complete a loss mitigation application and could not otherwise obtain relief with respect to the forborne or delinquent payments, the interim final rule will enable borrowers to obtain the deferral in the first place. Without a deferral, borrowers may need to repay the forborne or delinquent payments immediately. Borrowers who can do so would use savings, sell assets, or incur additional debt. Borrowers who cannot immediately repay the forborne or delinquency balances could suffer foreclosure or other negative consequences. Thus, for borrowers who obtain a deferral under the new exception, the benefit of the provision is, at a minimum, the interest on savings or asset appreciation that need not be foregone or the borrowing costs that need not be incurred. For other borrowers, the benefit of the provision is the value of preventing delinquency fees and foreclosure.

The Bureau does not have data available to predict what fraction of borrowers currently under a forbearance or delinquency related to the COVID-19 emergency would not be able to complete a loss mitigation application if required to complete the application in order to receive a deferral offer. However, the Bureau believes that in the present circumstances that percentage could be substantial due to limitations in servicer capacity. As discussed above, data from the MBA indicates that as of June 7, 2020, roughly 8.55 percent of all mortgages were currently in forbearance, a total of about 4.3 million loans, almost all of which entered forbearance following the passage of the CARES Act and thus could exit forbearance around the same time. Processing complete loss mitigation applications for all these borrowers in a short period of time would likely strain many servicers' resources. This might lead to more borrowers who have incomplete applications that never reach completion and who fail to get a deferral under the baseline compared to what might occur under standard market conditions. The Bureau also does not have data available to predict how many borrowers currently in a forbearance or a delinquency related to the COVID-19 emergency would experience foreclosure but for a payment deferral offered under the exception in this interim final rule.

Covered persons will benefit from the reduction in burden from the requirement to process complete loss mitigation applications for deferrals described in § 1024.41(c)(2)(v)(A) that are eligible for the exception. Given the number of loans that are currently in a forbearance due to the COVID-19 emergency, this benefit could be substantial. This may be particularly true for loans serviced on behalf of Fannie Mae and Freddie Mac. As part of the FHFA COVID-19 payment deferral program, Fannie Mae and Freddie Mac are requiring servicers of their loans to actively attempt to contact consumers currently in a CARES Act forbearance in order to verify eligibility for a deferral. 69 Thus, with or without the interim final rule, servicers of loans that are owned, insured, or guaranteed by Fannie Mae and Freddie Mac are required to attempt to contact borrowers currently in a CARES Act forbearance. Without the interim final rule, in each case, the servicers would further need to collect documentation needed for a complete loss mitigation application, and to process the complete application before a deferral could be offered. Multiplied by millions of such loans in forbearance, these costs could be substantial.

Potential specific impacts of the interim final rule. The Bureau believes that a large fraction of depository institutions and credit unions with $10 billion or less in total assets that are engaged in servicing mortgage loans qualify as “small servicers” for purposes of the mortgage servicing rules because they service 5,000 or fewer loans, all of which they or an affiliate own or originated. Small servicers are not subject to the relevant portions of Regulation X, § 1024.41, and so are not affected by the amendments in this interim final rule.

With respect to servicers that are not small servicers as defined in § 1026.41(e)(4), the Bureau believes that the consideration of benefits and costs of covered persons presented above provides a largely accurate analysis of the impacts of the final rule on depository institutions and credit unions with $10 billion or less in total assets that are engaged in servicing mortgage loans.

The Bureau has no reason to believe that the additional flexibility offered to covered persons by this interim final rule would differentially affect consumers in rural areas. The Bureau requests comment regarding the impact of the amended provisions on consumers in rural areas and how those impacts may differ from those experienced by consumers generally.

The Regulatory Flexibility Act (RFA)  70 does not apply to a rulemaking where general notice of proposed rulemaking is not required. 71 As noted previously, the Bureau has determined that it is unnecessary to publish a general notice of proposed rulemaking for this interim final rule. Accordingly, the RFA's requirements relating to an initial and final regulatory flexibility analysis do not apply.

The Bureau has determined that the interim final rule does not impose any new or revise any existing recordkeeping, reporting, or disclosure requirements on covered entities or members of the public that would be collections of information requiring approval by the Office of Management and Budget under the Paperwork Reduction Act. 72

Pursuant to the Congressional Review Act, 73 the Bureau will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to the rule's published effective date. The Office of Information and Regulatory Affairs has designated this rule as a “major rule” as defined by 5 U.S.C. 804(2). As discussed in part IV, the Bureau finds that there is good cause for the rule to take effect without prior notice and comment. Accordingly, this rule may take effect at such time as the Bureau determines. 5 U.S.C. 808(2).

The Director of the Bureau, having reviewed and approved this document, is delegating the authority to electronically sign this document to Laura Galban, a Bureau Federal Register Liaison, for purposes of publication in the Federal Register .

For the reasons set forth above, the Bureau amends Regulation X, 12 CFR part 1024, as set forth below:

On March 13, 2020, President Trump declared the ongoing Coronavirus Disease 2019 (COVID-19) pandemic of sufficient severity and magnitude to warrant an emergency declaration for all States, territories, and the District of Columbia. With the COVID-19 emergency, many small businesses nationwide are experiencing economic hardship as a direct result of the Federal, State, tribal, and local public health measures that are being taken to minimize the public's exposure to the virus. These measures, some of which are government-mandated, have been implemented nationwide and include the closures of restaurants, bars, and gyms. In addition, based on the advice of public health officials, other measures, such as keeping a safe distance from others or even stay-at-home orders, have been implemented, resulting in a dramatic decrease in economic activity as the public avoids malls, retail stores, and other businesses.

On March 27, 2020, the President signed the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act) (Pub. L. 116-136) to provide emergency assistance and health care response for individuals, families, and businesses affected by the coronavirus pandemic. The Small Business Administration (SBA) received funding and authority through the CARES Act to modify existing loan programs and establish a new loan program to assist small businesses nationwide adversely impacted by the COVID-19 emergency.

Section 1102 of the CARES Act temporarily permits SBA to guarantee 100 percent of 7(a) loans under a new program titled the “Paycheck Protection Program.” Section 1106 of the CARES Act provides for forgiveness of up to the full principal amount of qualifying loans guaranteed under the Paycheck Protection Program (PPP).

On April 24, 2020, the President signed the Paycheck Protection Program and Health Care Enhancement Act (Pub. L. 116-139), which provided additional funding and authority for the PPP. On June 5, 2020, the President signed the Paycheck Protection Program Flexibility Act of 2020 (Flexibility Act) (Pub. L. 116-142), which changed provisions of the PPP relating to the maturity of PPP loans, the deferral of PPP loan payments, and the forgiveness of PPP loans.

This interim final rule addresses payroll costs that may be included on a PPP loan application submitted by certain boat owners or operators that are engaged in catching fish or other forms of aquatic animal life (fishing boat owners) and that have hired one or more crewmembers who are regarded as independent contractors or otherwise self-employed for certain federal tax purposes under 26 U.S.C. 3121(b)(20) of the Internal Revenue Code (the Code). A crewmember may be described in Section 3121(b)(20) of the Code if the fishing boat on which he or she works has an operating crew that is normally made up of fewer than 10 individuals and the crewmember receives as compensation for his or her work a share of the boat's catch or of the proceeds from the sale of the catch, in an amount that depends on the amount of the catch. Such a crewmember generally may not receive additional cash remuneration or other compensation for his or her services with respect to the fishing boat. A fishing boat owner must report compensation paid to such a crewmember on Box 5 of IRS Form 1099-MISC. The First Interim Final Rule, posted on April 2, 2020, provided that because independent contractors have the ability to apply for a PPP loan on their own, they do not count for purposes of another applicant's PPP loan calculation. 85 FR 20811, 20813 (April 15, 2020). Because crewmembers described in Section 3121(b)(20) of the Code are treated as independent contractors or otherwise self-employed for certain federal tax purposes, fishing boat owners have faced uncertainty about whether to report payments to such crewmembers as a payroll cost on their PPP loan applications.

On April 14, 2020, SBA, in consultation with Treasury, posted an interim final rule explaining that the self-employment income of the general active partners of a partnership could be reported as a payroll cost, up to $100,000 annualized, on a PPP loan application filed by or on behalf of the partnership. 1 85 FR 21747, 21748 (April 20, 2020). The Administrator, in consultation with the Secretary, has determined that the relationship of a fishing boat owner and a crewmember described in Section 3121(b)(20) of the Code is analogous to a joint venture or partnership. For example, the fishing boat owner and crewmembers each contribute labor or resources to a common commercial enterprise, and the owner and crewmembers share in the enterprise's profits. In order to harmonize SBA's interim final rule regarding partnerships with SBA's interim final rule described above regarding independent contactors, the Administrator, in consultation with the Secretary, has determined that in the event of a conflict ( i.e., a case where one or more partners in a partnership are treated as independent contractors for tax purposes), the rules regarding partnership will govern. Accordingly, as described below, this interim final rule (1) provides that a fishing boat owner may include compensation reported on Box 5 of Form 1099-MISC and paid to a crewmember described in Section 3121(b)(20) as a payroll cost in its PPP loan application, and (2) addresses a fishing boat owner's eligibility to obtain loan forgiveness of payroll costs paid to a crewmember who has obtained his or her own PPP loan.

This interim final rule is effective without advance notice and public comment because Section 1114 of the CARES Act authorizes SBA to issue regulations to implement Title I of the Act without regard to notice requirements. In addition, SBA has determined that there is good cause for dispensing with advance public notice and comment on the grounds that that it would be contrary to the public interest. Specifically, advance public notice and comment would defeat the purpose of this interim final rule given that SBA's authority to guarantee PPP loans expires on June 30, 2020. These same reasons provide good cause for SBA to dispense with the 30-day delayed effective date provided in the Administrative Procedure Act (APA). See 5 U.S.C. 553(b)(B). Although this interim final rule is effective on or before date of filing, comments are solicited from interested members of the public on all aspects of the interim final rule, including Section III below. These comments must be submitted on or before July 30, 2020. The SBA will consider these comments and the need for making any revisions as a result of these comments.

The CARES Act was enacted to provide immediate assistance to individuals, families, and organizations affected by the COVID-19 emergency. Among the provisions contained in the CARES Act are provisions authorizing SBA to temporarily guarantee loans under a new 7(a) loan program titled the “Paycheck Protection Program.” Loans guaranteed under the Paycheck Protection Program (PPP) will be 100 percent guaranteed by SBA, and the full principal amount of the loans may qualify for loan forgiveness. The purpose of this interim final rule is to provide additional guidance concerning payroll costs that may be reported in connection with certain PPP loan and loan forgiveness applications.

May fishing boat owners include payroll costs in their PPP loan applications that are attributable to crewmembers described in Section 3121(b)(20) of the Internal Revenue Code?

Yes. The Administrator, in consultation with the Secretary, has determined that the relationship of a crewmember described in Section 3121(b)(20) of the Internal Revenue Code (Code) and a fishing boat owner or operator (fishing boat owner) is analogous to a joint venture or partnership for purposes of the PPP. As a result, a fishing boat owner may include compensation reported on Box 5 of IRS Form 1099-MISC and paid to a crewmember described in Section 3121(b)(20) of the Code, up to $100,000 annualized, as a payroll cost in its PPP loan application. The Administrator, in consultation with the Secretary, has determined that this treatment is appropriate to effectuate the purposes of the CARES Act to provide assistance to eligible PPP borrowers, including business concerns that operate as partnerships, affected by the COVID-19 emergency.

May a fishing boat owner include as payroll costs in its application for loan forgiveness any compensation paid to a crewmember who received his or her own PPP loan and is seeking forgiveness for amounts of compensation the crewmember received for performing services described in Section 3121(b)(20) of the Code with respect to that owner's fishing boat?

No. If a fishing boat crewmember obtains his or her own PPP loan and seeks forgiveness of that loan based in part on compensation from a particular fishing boat owner, the fishing boat owner cannot also obtain PPP loan forgiveness based on compensation paid to that same crewmember. This restriction applies only if the crewmember is performing services described in Section 3121(b)(20) of the Code for the particular fishing boat owner. The Administrator, in consultation with the Secretary, has determined that this restriction is necessary to prevent fishing boat owners and crewmembers from claiming forgiveness for the same payroll costs (for the owner's PPP loan, the compensation to a specific crewmember; for the crewmember's PPP loan, the compensation from the owner to that crewmember). As a result, only the crewmember's PPP loan is eligible for forgiveness, and the owner may not obtain forgiveness for any payroll costs paid to the crewmember. The fishing boat owner is responsible for determining whether any of its crewmembers during the covered period for loan forgiveness received their own PPP loans. Due to the increased risk of duplicate payroll costs, PPP loans to fishing boat owners are more likely to be subject to an SBA loan review.

SBA may provide further guidance, if needed, through SBA notices that will be posted on SBA's website at www.sba.gov. Questions on the Paycheck Protection Program may be directed to the Lender Relations Specialist in the local SBA Field Office. The local SBA Field Office may be found at https://www.sba.gov/tools/local-assistance/districtoffices.

This interim final rule is economically significant for the purposes of Executive Orders 12866 and 13563, and is considered a major rule under the Congressional Review Act. SBA, however, is proceeding under the emergency provision at Executive Order 12866 Section 6(a)(3)(D) based on the need to move expeditiously to mitigate the current economic conditions arising from the COVID-19 emergency. This rule's designation under Executive Order 13771 will be informed by public comment.

SBA has drafted this rule, to the extent practicable, in accordance with the standards set forth in Section 3(a) and 3(b)(2) of Executive Order 12988, to minimize litigation, eliminate ambiguity, and reduce burden. The rule has no preemptive or retroactive effect.

SBA has determined that this rule will not have substantial direct effects on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various layers of government. Therefore, SBA has determined that this rule has no federalism implications warranting preparation of a federalism assessment.

SBA has determined that this rule will not impose new or modify existing recordkeeping or reporting requirements under the Paperwork Reduction Act.

The Regulatory Flexibility Act (RFA) generally requires that when an agency issues a proposed rule, or a final rule pursuant to Section 553(b) of the APA or another law, the agency must prepare a regulatory flexibility analysis that meets the requirements of the RFA and publish such analysis in the Federal Register . 5 U.S.C. 603, 604. Specifically, the RFA normally requires agencies to describe the impact of a rulemaking on small entities by providing a regulatory impact analysis. Such analysis must address the consideration of regulatory options that would lessen the economic effect of the rule on small entities. The RFA defines a “small entity” as (1) a proprietary firm meeting the size standards of the Small Business Administration (SBA); (2) a nonprofit organization that is not dominant in its field; or (3) a small government jurisdiction with a population of less than 50,000. 5 U.S.C. 601(3)-(6). Except for such small government jurisdictions, neither State nor local governments are “small entities.” Similarly, for purposes of the RFA, individual persons are not small entities.

The requirement to conduct a regulatory impact analysis does not apply if the head of the agency “certifies that the rule will not, if promulgated, have a significant economic impact on a substantial number of small entities.” 5 U.S.C. 605(b). The agency must, however, publish the certification in the Federal Register at the time of publication of the rule, “along with a statement providing the factual basis for such certification.” If the agency head has not waived the requirements for a regulatory flexibility analysis in accordance with the RFA's waiver provision, and no other RFA exception applies, the agency must prepare the regulatory flexibility analysis and publish it in the Federal Register at the time of promulgation or, if the rule is promulgated in response to an emergency that makes timely compliance impracticable, within 180 days of publication of the final rule. 5 U.S.C. 604(a), 608(b).

Rules that are exempt from notice and comment are also exempt from the RFA requirements, including conducting a regulatory flexibility analysis, when among other things the agency for good cause finds that notice and public procedure are impracticable, unnecessary, or contrary to the public interest. SBA Office of Advocacy guide: How to Comply with the Regulatory Flexibility Act, Ch.1. p.9 . Accordingly, SBA is not required to conduct a regulatory flexibility analysis.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. Subtitle I, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it amends Class D airspace and removes Class E airspace extending upward from 700 feet above the surface at Bogue Field MCALF, Bogue, NC, due to the airspace no longer being necessary.

The FAA published a notice of proposed rulemaking in the Federal Register (85 FR 14809, March 16, 2020) for Docket No. FAA-2020-0164 to amend Class D airspace by updating the geographic coordinates, and remove Class E airspace extending upward from 700 feet above the surface at Bogue Field Marine Corps Auxiliary Field, Bogue, NC as the airport has no instrument approaches. Therefore, the Class E airspace is no longer necessary. This action enhances the safety and management of controlled airspace within the national airspace system.

Interested parties were invited to participate in this rulemaking effort by submitting written comments on the proposal to the FAA. No negative comments were received.

Class D and Class E airspace designations are published in Paragraphs 5000 and 6005, respectively, of FAA Order 7400.11D, dated August 8, 2019, and effective September 15, 2019, which is incorporated by reference in 14 CFR part 71.1. The Class E airspace designation listed in this document will be published subsequently in the Order.

This document amends FAA Order 7400.11D, Airspace Designations and Reporting Points, dated August 8, 2019, and effective September 15, 2019. FAA Order 7400.11D is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.11D lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

The amendment to Title 14 Code of Federal Regulations (14 CFR) part 71 amends Class D airspace at Bogue Field Marine Corps Auxiliary Field, Bogue, NC, by updating the geographic coordinates, and removes Class E airspace extending upward from 700 feet above the surface at Bogue Field Marine Corps Auxiliary Field, Bogue, NC as the airport has no instrument approaches. This action enhances the safety and management of controlled airspace within the national airspace system. This action also replaces the outdated term Airport/Facility Directory with the term Chart Supplement in the legal description of associated Class D airspace.

These changes are necessary for continued safety and management of IFR operations at this airport.

FAA Order 7400.11, Airspace Designations and Reporting Points, is published yearly and effective on September 15.

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

The FAA has determined that this action qualifies for categorical exclusion under the National Environmental Policy Act in accordance with FAA Order 1050.1F, “Environmental Impacts: Policies and Procedures,” paragraph 5-6.5a. This airspace action is not expected to cause any potentially significant environmental impacts, and no extraordinary circumstances exist that warrant preparation of an environmental assessment.

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

Section 553(b)(3)(B) of the Administrative Procedure Act (APA) (5 U.S.C. 551 et seq. ) authorizes agencies to dispense with notice and comment procedures for rules when the agency for “good cause” finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Section 553(d)(3) of the APA requires that agencies publish a rule not less than 30 days before its effective date, except as otherwise provided by the agency for good cause found and published with the rule.

Because this action merely makes technical amendments to a published final rule, the FAA finds that notice and public comment under 5 U.S.C. 553(b) is unnecessary. For the same reason, the FAA finds that good cause exists under 5 U.S.C. 553(d) for making this rule effective in less than 30 days.

On February 25, 2020, the FAA published the PPD final rule (85 FR 10896). After that rule was published, the FAA discovered two minor errors in § 121.409 and § 121.424 of Title 14 of the Code of Federal Regulations that require correction. Section 121.409(c)(1) erroneously references § 121.424(d). This final rule redesignated § 121.424(d) as § 121.424(e). Additionally, the newly finalized § 121.424(f) erroneously references § 121.424(b)(2), which was redesignated in the PPD final rule as § 121.424(c)(2).

Accordingly, FAA corrects 14 CFR part 121 by making the following technical corrections:

The Coast Guard will enforce the safety zones in 33 CFR 165.918 as per the time, dates, and locations in Table 1 below.

This action is being taken to protect the safety of life and property on navigable waters prior to, during, and immediately after firework displays. During the enforcement period, no vessel may transit this regulated area without approval from the Captain of the Port Sault Sainte Marie or a designated representative. Vessels and persons granted permission to enter the safety zone shall obey all lawful orders or directions of the Captain of the Port Sault Sainte Marie, or an on-scene representative.

This notice of enforcement is issued under authority of 33 CFR 165.930 and 5 U.S.C. 552 (a). In addition to this notice in the Federal Register , the Coast Guard will also provide notice through other means, which will include Broadcast Notice to Mariners, Local Notice to Mariners, distribution in leaflet form, and on-scene oral notice. The Captain of the Port Sault Sainte Marie or a designated on-scene representative may be contacted via Channel 16, VHF-FM or at (906) 635-3319.

The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because doing so would be impracticable due to late notification from the event sponsor of the particulars of the fireworks display. This safety zone is needed to be established by July 3, 2020 in order to protect the public from the dangers associated with a fireworks display.

Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register . Delaying the effective date of this rule would be impracticable because action is needed to establish a safety zone in order to protect the public from the hazards associated with the fireworks display.

The Coast Guard is issuing this rule under authority in 46 U.S.C. 70034 (previously 33 U.S.C. 1231). The Captain of the Port Sault Sainte Marie (COTP) has determined that potential hazards associated with a fireworks display on July 3, 2020 will be a safety concern for anyone within a 560-foot radius of the navigable waters surrounding the fireworks launching location. This rule is needed to protect personnel, vessels, and the marine environment in the navigable waters within the safety zone during the fireworks display.

This rule establishes a safety zone from 10 p.m. until 11:59 p.m. on July 3, 2020. The safety zone will cover all navigable waters within 560 feet of a fireworks display in Little Traverse Bay near Bay Harbor, MI. The duration of the zone is intended to protect personnel, vessels, and the marine environment in these navigable waters during the fireworks display. No vessel or person will be permitted to enter the safety zone without obtaining permission from the COTP or a designated representative.

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

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

This regulatory action determination is based on size, location, duration, and time-of-day of the safety zone. Vessel traffic will be able to safely transit around this safety zone which would impact a small designated area of Little Traverse Bay, MI. Moreover, the Coast Guard will issue a Broadcast Notice to Mariners via VHF-FM marine channel 16 about the zone.

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

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

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

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

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

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

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

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

We have analyzed this rule under Department of Homeland Security Directive 023-01, Rev. 1, associated implementing instructions, and Environmental Planning COMDTINST 5090.1 (series), which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves a safety zone lasting less than 2 hours that will prohibit entry within 560 feet of a fireworks display in Little Traverse Bay, MI. It is categorically excluded from further review under paragraph L[60(a)] of Appendix A, Table 1 of DHS Instruction Manual 023-01-001-01, Rev. 1. A Record of Environmental Consideration supporting this determination is available in the docket. For instructions on locating the docket, see the ADDRESSES section of this preamble.

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

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

The Coast Guard will enforce the safety zones in 33 CFR 165.918 as per the time, dates, and locations in Table 1.

This action is being taken to protect the safety of life and property on navigable waters prior to, during, and immediately after firework displays. During the enforcement period, no vessel may transit this regulated area without approval from the Captain of the Port Sault Sainte Marie or a designated representative. Vessels and persons granted permission to enter the safety zone shall obey all lawful orders or directions of the Captain of the Port Sault Sainte Marie, or an on-scene representative.

This notice of enforcement is issued under authority of 33 CFR 165.930 and 5 U.S.C. 552(a). In addition to this document in the Federal Register , the Coast Guard will also provide notice through other means, which will include Broadcast Notice to Mariners, Local Notice to Mariners, distribution in leaflet form, and on-scene oral notice. The Captain of the Port Sault Sainte Marie or a designated on-scene representative may be contacted via Channel 16, VHF-FM or at (906) 635-3319.

The Coast Guard will enforce the safety zones in 33 CFR 165.918 as per the time, dates, and locations in Table 1 below.

This action is being taken to protect the safety of life and property on navigable waters prior to, during, and immediately after firework displays. During the enforcement period, no vessel may transit this regulated area without approval from the Captain of the Port Sault Sainte Marie or a designated representative. Vessels and persons granted permission to enter the safety zone shall obey all lawful orders or directions of the Captain of the Port Sault Sainte Marie, or an on-scene representative.

This notice of enforcement is issued under authority of 33 CFR 165.930 and 5 U.S.C. 552 (a). In addition to this notice in the Federal Register , the Coast Guard will also provide notice through other means, which will include Broadcast Notice to Mariners, Local Notice to Mariners, distribution in leaflet form, and on-scene oral notice. The Captain of the Port Sault Sainte Marie or a designated on-scene representative may be contacted via Channel 16, VHF-FM or at (906) 635-3319.

The Coast Guard will enforce the safety zones in 33 CFR 165.918 as per the time, dates, and locations in Table 1 below.

This action is being taken to protect the safety of life and property on navigable waters prior to, during, and immediately after firework displays. During the enforcement period, no vessel may transit this regulated area without approval from the Captain of the Port Sault Sainte Marie or a designated representative. Vessels and persons granted permission to enter the safety zone shall obey all lawful orders or directions of the Captain of the Port Sault Sainte Marie, or an on-scene representative.

This notice of enforcement is issued under authority of 33 CFR 165.930 and 5 U.S.C. 552 (a). In addition to this notice in the Federal Register , the Coast Guard will also provide notice through other means, which will include Broadcast Notice to Mariners, Local Notice to Mariners, distribution in leaflet form, and on-scene oral notice. The Captain of the Port Sault Sainte Marie or a designated on-scene representative may be contacted via Channel 16, VHF-FM or at (906) 635-3319.

The Coast Guard will enforce the safety zones in 33 CFR 165.918 as per the time, dates, and locations in Table 1 below.

This is a summary of the Commission's Order, DA 20-562, adopted on May 27, 2020 and released on May 28, 2020. The full text of this document is available for public inspection and copying during normal business hours in the FCC Reference Center (Room CY-A257), 445 12th Street SW, Washington, DC 20554, or by downloading the text from the Commission's website at https://www.fcc.gov/document/new-location-filing-hand-carried-documents-fcc-headquarters.

1. Section 603 of the Regulatory Flexibility Act, as amended, requires a regulatory flexibility analysis in notice and comment rulemaking proceedings. See 5 U.S.C. 603(a). As we are adopting these rules without notice and comment, no regulatory flexibility analysis is required.

2. This document does not contain new or modified information collection requirements subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. In addition, therefore, it does not contain any new or modified information collection burden for small business concerns with fewer than 25 employees, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

3. The Commission will not send a copy of the Order pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A), because the adopted rules are rules of agency organization, procedure, or practice that do not “substantially affect the rights or obligations of non-agency parties.” See 5 U.S.C. 804(3)(C).

4. In the Order, the Office of Managing Director of the Federal Communications Commission amends its rules to reflect the new address for filing hand-carried documents at the Commission's headquarters and establish a new closing time for accepting such filings. Effective upon publication in the Federal Register , hand-carried documents are to be filed at 9050 Junction Drive, Annapolis Junction, MD 20701. After COVID-19 restrictions are lifted, this will be the only location where hand-carried paper filings for the Commission will be accepted. At that time, the filing window for hand-carried documents will be open from 8:00 a.m. to 4:00 p.m., Monday through Friday. The Commission will not accept hand-carried filings outside of those hours. These changes are being made to enhance security measures and in conjunction with the Commission's upcoming relocation to a new headquarters building located at 45 L Street NE, Washington, DC 20554, which is scheduled to occur later this year.

5. This action is taken pursuant to the authority delegated by §§ 0.11 and 0.231 of the Commission's rules, 47 CFR 0.11 and 0.231.

6. Accordingly, pursuant to sections 4(e) and 5(e) of the Communications Act of 1934, as amended, 47 U.S.C. 154(e) and 155(d), it is ordered that part 0 of the Commission's rules are amended in the manner indicated in the Appendix of the Order, to be effective upon publication in the Federal Register .

For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR parts 0 and 1 as follows:

The Commission submitted revised information collection requirements for review and approval by OMB, as required by the Paperwork Reduction Act (PRA) of 1995, on May 13, 2020, which were approved by OMB on June 22, 2020. The information collection requirements are contained in the Commission's Rate-of-Return Order, FCC 18-176 published at 84 FR 4711, February 19, 2019. The OMB Control Number is 3060-0233. If you have any comments on the burden estimates listed in the following, or how the Commission can improve the collections and reduce any burdens caused thereby, please contact Nicole Ongele, Federal Communications Commission, Room 1-A620, 445 12th Street SW, Washington, DC 20554. Please include the OMB Control Number, 3060-0233, in your correspondence. The Commission will also accept your comments via email at PRA@fcc.gov.

To request materials in accessible formats for people with disabilities (Braille, large print, electronic files, audio format), send an email to fcc504@fcc.gov or call the Consumer and Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-0432 (TTY).

As required by the Paperwork Reduction Act of 1995 (44 U.S.C. 3507), the Commission is notifying the public that it received OMB approval on June 22, 2020, for the information collection requirements contained in 47 CFR 54.313(f)(5) published at 84 FR 4711, February 19, 2019. Under 5 CFR part 1320, an agency may not conduct or sponsor a collection of information unless it displays a current, valid OMB Control Number.

No person shall be subject to any penalty for failing to comply with a collection of information subject to the Paperwork Reduction Act that does not display a current, valid OMB Control Number. The OMB Control Number is 3060-0233.

The foregoing notice is required by the Paperwork Reduction Act of 1995, Public Law 104-13, October 1, 1995, and 44 U.S.C. 3507.

The total annual reporting burdens and costs for the respondents are as follows:

OMB Control Number: 3060-0233.

OMB Approval Date: June 22, 2020.

OMB Expiration Date: June 30, 2023.

Title: Part 54—Rate-of-Return Carrier Universal Service Reporting Requirements.

Form Number: FCC Form 507, FCC Form 508 and FCC Form 509.

Type of Review: Revision of a currently approved collection.

Respondents: Business or other for-profit.

Number of Respondents and Responses: 1,095 respondents; 4,044 responses.

Estimated Time per Response: 1-22 hours.

Frequency of Response: On occasion and annual reporting requirements.

Obligation to Respond: Required to obtain or retain benefits. Statutory authority for this information collection is contained in 47 U.S.C. 151-154, 214, 218-220, 221(c), 254, and 303(r).

Total Annual Burden: 43,638 hours.

Total Annual Cost: No Cost.

Privacy Act Impact Assessment: No impact(s).

Nature and Extent of Confidentiality: No assurance of confidentiality has been given regarding the information. However, respondents may request materials or information submitted to the Commission be withheld from public inspection under 47 CFR 0.459 of the FCC's rules.

Needs and Uses: In order to determine which carriers are entitled to universal service support, all rate-of-return regulated (rate-of-return) incumbent local exchange carriers (LECs) must provide the National Exchange Carrier Association (NECA) with the loop cost and loop count data required by section 54.1305 for each of its study areas and, if applicable, for each wire center as that term is defined in 47 CFR part 54. See 47 CFR 54.1305 and 54.5. The loop cost and loop count information is to be filed annually with NECA by July 31st of each year, and may be updated occasionally pursuant to section 54.1306. See 47 CFR 54.1306. Pursuant to section 54.1307, the information filed on July 31st of each year will be used to calculate universal service support for each study area and is filed by NECA with the Commission on October 1 of each year. See 47 CFR 54.1307. An incumbent LEC is defined as a carrier that meets the definition of “incumbent local exchange carrier” in section 51.5 of the Commission's rules. See 47 CFR 51.5.

In March 2016, the Commission adopted the Rate-of-Return Reform Order, 81 FR 24282, April 25, 2016, to continue modernizing the universal service support mechanisms for rate-of-return carriers. The Rate-of-Return Reform Order replaced the Interstate Common Line Support (ICLS) mechanism with the Connect America Fund—Broadband Loop Support (CAF-BLS) mechanism. While ICLS supported only lines used to provide traditional voice service (including voice service bundled with broadband service), CAF-BLS also supports consumer broadband-only loops. In March 2016, the Commission adopted the Rate-of-Return Reform Order to continue modernizing the universal service support mechanisms for rate-of-return carriers. The Rate-of-Return Reform Order replaced the Interstate Common Line Support (ICLS) mechanism with the Connect America Fund—Broadband Loop Support (CAF-BLS) mechanism. While ICLS supported only lines used to provide traditional voice service (including voice service bundled with broadband service), CAF-BLS also supports consumer broadband-only loops. For the purposes of calculating and monitoring CAF-BLS, rate-of-return carriers that receive CAF-BLS must file common line and consumer broadband-only loop counts on FCC Form 507, forecasted common line and consumer broadband-only loop costs and revenues on FCC Form 508, and actual common line and consumer broadband-only loop costs and revenues on FCC Form 509. See 47 CFR 54.903(a).

In December 2018, the Commission adopted the December 2018 Rate-of-Return Reform Order, 84 FR 4711, February 19, 2019, to require rate-of-return carriers that receive Alternative Connect American Model (A-CAM) or Alaska Plan support to file line count data on FCC Form 507 as a condition of high-cost support. Historically, all rate-of-return carriers received CAF BLS or, prior to that, ICLS, and were required to file line count data on FCC Form 507 as a condition of that support. In recent years, some rate-of-return carriers have elected to receive A-CAM I, A-CAM II, or Alaska Plan instead, and those carriers were not required to file line count data because the requirement to file applied only to rate-of-return carriers receiving CAF BLS. In order to restore a data set that the Commission relied on to evaluate the effectiveness of its high-cost universal service programs, the Commission revised its rules in that Order to require all rate-of-return carriers to file that data. While carriers receiving CAF-BLS must file the line count data on March 31 for line counts as of the prior December 31, the A-CAM I, A-CAM II, and Alaska Plan carriers will be required to file on July 1 of each year to coincide with other existing requirements in OMB Control No. 3060-0986. Connect America Fund et al., WC Docket No. 10-90 et al., Report and Order, Further Notice of Proposed Rulemaking and Order on Reconsideration, 33 FCC Rcd 11893 (2018) ( 2018 Rate-of-Return Reform Order ). See also 47 CFR 54.313(f)(5).

The Commission therefore revises this information collection. We also increased the burdens associated with existing reporting requirements to account for additional carriers that will be subject to those requirements.

Why we need to publish a rule. Under the Act, if we determine that any species is an endangered or threatened species, we must designate critical habitat to the maximum extent prudent and determinable. We published in the Federal Register a final rule to list the elfin-woods warbler as a threatened species on June 22, 2016 (81 FR 40534). On that same day, we also published a proposed rule to designate critical habitat for the elfin-woods warbler (81 FR 40632). Designations of critical habitat can only be completed by issuing a rule.

What this rule does. This rule will finalize the designation of critical habitat for the elfin-woods warbler under the Act. Accordingly, this rule revises part 17 of title 50 of the Code of Federal Regulations at 50 CFR 17.95.

Basis for this rule. Under section 4(a)(3) of the Act, if we determine that any species is an endangered or threatened species we must, to the maximum extent prudent and determinable, designate critical habitat. Section 4(b)(2) of the Act states that the Secretary shall designate critical habitat on the basis of the best available scientific data after taking into consideration the economic impact, national security impact, and any other relevant impact of specifying any particular area as critical habitat. Section 3(5)(A) of the Act defines critical habitat as (i) the specific areas within the geographical area occupied by the species, at the time it is listed, on which are found those physical or biological features (I) essential to the conservation of the species and (II) which may require special management considerations or protections; and (ii) specific areas outside the geographical area occupied by the species at the time it is listed, upon a determination by the Secretary that such areas are essential for the conservation of the species and that the area contains one or more of those physical or biological features essential to the conservation of the species, as interpreted by regulation at 50 CFR 424.12. The Secretary may exclude an area from critical habitat if he determines that the benefits of such exclusion outweigh the benefits of specifying such area as part of the critical habitat, unless he determines, based on the best scientific data available, that the failure to designate such area as critical habitat will result in the extinction of the species.

The critical habitat we are designating in this rule, in three units comprising 27,488 acres (ac) (11,125 hectares (ha)), constitutes our current best assessment of the areas that meet the definition of critical habitat for the elfin-woods warbler.

Economic analysis. In accordance with section 4(b)(2) of the Act, we prepared an economic analysis of the impacts of designating critical habitat. We published this announcement and solicited public comments on the draft economic analysis (81 FR 40632; June 22, 2016).

Peer review and public comment. In accordance with our joint policy on peer review published in the Federal Register on July 1, 1994 (59 FR 34270), and our August 22, 2016, memorandum updating and clarifying the role of peer review of actions under the Act, we sought the expert opinions of six independent specialists with scientific expertise that included familiarity with the species, the geographic region in which the species occurs, and conservation biology principles. The purpose of peer review is to ensure that our designation is based on scientifically sound data and analyses. We received responses from two peer reviewers on our technical assumptions, analysis, and whether or not we used the best scientific data available. These peer reviewers generally concurred with our methods and conclusions and provided additional information, clarifications, and suggestions to improve this final rule. Information we received from peer review is incorporated in this final designation of critical habitat. We also considered all comments and information received from the public during the comment period for the proposed designation of critical habitat.

All previous Federal actions are described in the proposed and final listing rules for the elfin-woods warbler as a threatened species under the Act published on September 30, 2015 (80 FR 58674) and June 22, 2016 (81 FR 40534). Concurrently with the final listing rule, we adopted a rule under section 4(d) of the Act to provide for the conservation of the elfin-woods warbler. We published our proposed rule to designate critical habitat for the elfin-woods warbler on June 22, 2016 (81 FR 40632).

On August 27, 2019, we published a final rule in the Federal Register (84 FR 45020) to amend our regulations concerning the procedures and criteria we use to designate and revise critical habitat. That rule became effective on September 26, 2019, but, as stated in that rule, the amendments it sets forth apply to “rules for which a proposed rule was published after September 26, 2019.” We published our proposed critical habitat designation for the elfin-woods warbler on June 22, 2016 (81 FR 40534); therefore, the amendments set forth in the August 27, 2019, final rule at 84 FR 45020 do not apply to this final designation of critical habitat for the elfin-woods warbler. Nonetheless, we note that this designation is also consistent with the standards set forth in the August 27, 2019 amendments to the regulations.

In the June 22, 2016, proposed critical habitat rule (81 FR 40632), we requested that all interested parties submit written comments on the proposed designation of critical habitat for the elfin-woods warbler by August 22, 2016. We also contacted appropriate Federal, State, and local agencies, scientific organizations, and other interested parties and invited them to comment on the proposed rule and draft economic analysis (DEA). A newspaper notice inviting general public comment was published in Primera Hora on June 24, 2016. We did not receive any requests for a public hearing, and we did not receive any comments on the DEA.

During the comment period, we received two comment letters from peer reviewers directly addressing the proposed critical habitat designation and one public comment. All substantive information provided during the comment period has either been incorporated directly into this final determination or addressed below, as appropriate.

(1) Comment: A peer reviewer recommended adding the westernmost patches of forest within the boundaries of the Maricao Commonwealth Forest (MCF) as critical habitat for the elfin-woods warbler. According to the reviewer, these forest patches qualify as essential habitat for the conservation of the species for breeding, reproduction, or rearing of offspring. The reviewer also reported two observations of elfin-woods warbler in those patches.

Our Response: We reviewed the westernmost boundaries of Unit 1 (Maricao) of the proposed critical habitat and the new data documenting the species' occurrence in the area. Based on the reanalysis of the area and the data provided by the peer reviewer, we revised Unit 1 to add approximately 363 ac (146 ha). This additional area comprises 2.8 percent of Unit 1. The Puerto Rico Department of Natural and Environmental Resources (PDNER) manages 97.8 percent of the additional area, in the MCF, with the remaining 2.2 percent (8 ac) of the additional area on private land.

(2) Comment: A peer reviewer recommended we expand the Maricao Unit because they believed habitat with physical and biological features on private lands outside the western boundary of the MCF was left out of the critical habitat designation. The reviewer recommended designating active and abandoned shade-grown coffee plantations, agricultural lands with native forest cover, and closed canopies that exist in the mountainsides parallel to road PR#105 up to km 12.4, as critical habitat. The reviewer stated that this area encompasses suitable habitat consistently used and occupied by the elfin-woods warbler.

Our Response: We reanalyzed the lands adjacent to the western boundary of the MCF. As described in our response to comment 1, we identified an additional 8 ac (3.2 ha) of private land adjacent to the MCF that is occupied and contains the physical and biological features required by the elfin-woods warbler that we are including as critical habitat. We determined the remainder of these private areas suggested by the peer reviewer are disturbed and do not fit our established criteria for critical habitat at this time (see Criteria Used To Identify Critical Habitat ). Because these areas are occupied, the species is protected in these areas. For example, where a landowner requests Federal agency funding or authorization for an action that may affect a listed species or critical habitat, the Federal agency would be required to consult with the Service under section 7(a)(2) of the Act. Additionally, the prohibitions of section 9 of the Act apply to the elfin-woods warblers that occur within these areas.

(3) Comment: A peer reviewer recommended we include Guilarte Commonwealth Forest as another area outside the geographic range of the elfin-woods warbler at the time of listing to be included as critical habitat, based on the potential of this forest to provide connectivity between occupied sites for genetic exchange and because it contains the necessary habitat to support the species.

Our Response: Based on the best available information at this time, we do not consider the Guilarte Commonwealth Forest (GCF) essential to the conservation of the species. The elfin-woods warbler has never been observed in the GCF, indicating the GCF may not be essential habitat for the species. In addition, occupancy of resilient populations of the elfin-woods warbler in the three areas that constitute its known historical range, which we are designating as critical habitat, would likely be sufficient to ensure conservation of the species. A critical habitat designation does not signal that habitat outside the designated area is unimportant or may not be beneficial for the recovery of the species. The Service can develop recovery actions during recovery planning for this site. We will continue working with our State partners to address the conservation needs of the elfin-woods warbler.

Section 4(b)(5)(A)(ii) of the Act requires the Service to give actual notice of any designation of lands that are considered to be critical habitat to the appropriate agency of each State in which the species is believed to occur, and invite each such agency to comment on the proposed regulation. Section 4(i) of the Act states, “the Secretary shall submit to the State agency a written justification for his failure to adopt regulations consistent with the agency's comments or petition.” For this rule we did not receive any written comments from the Commonwealth of Puerto Rico.

We received one public comment on the proposed rule. While the commenter indicated support for the habitat protection of the elfin-woods warbler, the commenter did not provide substantive comments requiring the Service's response.

This final rule incorporates changes to our proposed rule based on the comments and information we received, as discussed above in the Summary of Comments and Recommendations. All changes made were included accordingly into the document, tables, and maps. As a result, the final designation of critical habitat reflects the following changes from the June 22, 2016, proposed rule (81 FR 40632):

1. We revised Unit 1 (Maricao) to include additional area as critical habitat. This unit now consists of approximately 12,978 ac (5,252 ha), which is an increase of approximately 2.8 percent of the proposed area for Unit 1.

2. We corrected an error in the acreage of Unit 3 (Carite). The error resulted from rounding of numbers (rounding up from 0.55), and the change was an increase of approximately 1.1 ac (0.45 ha).

3. We refined our description of the physical and biological features to be more explicit about the features we are identifying, specifying these features include elevations above 300 meters in active shade-grown coffee plantations or forested agricultural lands dominated primarily by native vegetation, or abandoned coffee plantations or agricultural lands with native forest cover and a closed canopy. In the proposed rule, we did not specify the elevations in these landscapes. No adjustments to the unit boundaries were needed as a result of this change.

4. We updated the coordinates or plot points from which the maps were generated. The information is available at http://www.regulations.gov under Docket No. FWS-R4-ES-2020-0030, and from the Caribbean Ecological Services Field Office website at http://www.fws.gov/caribbean.

Critical habitat is defined in section 3 of the Act as:

(1) The specific areas within the geographical area occupied by the species, at the time it is listed in accordance with the Act, on which are found those physical or biological features

(a) Essential to the conservation of the species, and

(b) Which may require special management considerations or protection; and

(2) Specific areas outside the geographical area occupied by the species at the time it is listed, upon a determination that such areas are essential for the conservation of the species.

Our regulations at 50 CFR 424.02 define the geographical area occupied by the species as: An area that may generally be delineated around species' occurrences, as determined by the Secretary ( i.e., range). Such areas may include those areas used throughout all or part of the species' life cycle, even if not used on a regular basis ( e.g., migratory corridors, seasonal habitats, and habitats used periodically, but not solely by vagrant individuals).

Conservation, as defined under section 3 of the Act, means to use and the use of all methods and procedures that are necessary to bring an endangered or threatened species to the point at which the measures provided pursuant to the Act are no longer necessary. Such methods and procedures include, but are not limited to, all activities associated with scientific resources management such as research, census, law enforcement, habitat acquisition and maintenance, propagation, live trapping, and transplantation, and, in the extraordinary case where population pressures within a given ecosystem cannot be otherwise relieved, may include regulated taking.

Critical habitat receives protection under section 7 of the Act through the requirement that Federal agencies ensure, in consultation with the Service, that any action they authorize, fund, or carry out is not likely to result in the destruction or adverse modification of critical habitat. The designation of critical habitat does not affect land ownership or establish a refuge, wilderness, reserve, preserve, or other conservation area. Such designation does not allow the government or public to access private lands. Such designation does not require implementation of restoration, recovery, or enhancement measures by non-Federal landowners. Where a landowner requests Federal agency funding or authorization for an action that may affect a listed species or critical habitat, the Federal agency would be required to consult with the Service under section 7(a)(2) of the Act. However, even if the Service were to conclude that the proposed activity would result in destruction or adverse modification of the critical habitat, the Federal action agency and the landowner are not required to abandon the proposed activity, or to restore or recover the species; instead, they must implement “reasonable and prudent alternatives” to avoid destruction or adverse modification of critical habitat.

Under the first prong of the Act's definition of critical habitat, areas within the geographical area occupied by the species at the time it was listed are included in a critical habitat designation if they contain physical or biological features (1) which are essential to the conservation of the species and (2) which may require special management considerations or protection. For these areas, critical habitat designations identify, to the extent known using the best scientific and commercial data available, those physical or biological features that are essential to the conservation of the species (such as space, food, cover, and protected habitat). In identifying those physical or biological features within an area, we focus on the specific features that support the life-history needs of the species, including but not limited to, water characteristics, soil type, geological features, prey, vegetation, symbiotic species, or other features. A feature may be a single habitat characteristic, or a more complex combination of habitat characteristics. Features may include habitat characteristics that support ephemeral or dynamic habitat conditions. Features may also be expressed in terms relating to principles of conservation biology, such as patch size, distribution distances, and connectivity.

Under the second prong of the Act's definition of critical habitat, we may designate critical habitat in areas outside the geographical area occupied by the species at the time it is listed, upon a determination that such areas are essential for the conservation of the species.

For the elfin-woods warbler, we determined whether unoccupied areas are essential for the conservation of the species by considering the life-history, status, and conservation needs of the species. Our decision was further informed by observations of species-habitat relationships, habitat suitability models derived from these observations, and the locations of historical records to identify which features and specific areas are essential to the conservation of the species and, as a result, the development of the critical habitat designation.

Section 4 of the Act requires that we designate critical habitat on the basis of the best scientific data available. Further, our Policy on Information Standards Under the Endangered Species Act (published in the Federal Register on July 1, 1994 (59 FR 34271)), the Information Quality Act (section 515 of the Treasury and General Government Appropriations Act for Fiscal Year 2001 (Pub. L. 106-554; H.R. 5658)), and our associated Information Quality Guidelines provide criteria, establish procedures, and provide guidance to ensure that our decisions are based on the best scientific data available. They require our biologists, to the extent consistent with the Act and with the use of the best scientific data available, to use primary and original sources of information as the basis for recommendations to designate critical habitat.

When we are determining which areas should be designated as critical habitat, our primary source of information is generally the information developed during the listing process for the species. Additional information sources may include any generalized conservation strategy, criteria, or outline that may have been developed for the species, the recovery plan for the species, articles in peer-reviewed journals, conservation plans developed by States and counties, scientific status surveys and studies, biological assessments, other unpublished materials, or experts' opinions or personal knowledge.

Habitat is dynamic, and species may move from one area to another over time. We recognize that critical habitat designated at a particular point in time may not include all of the habitat areas that we may later determine are necessary for the recovery of the species. For these reasons, a critical habitat designation does not signal that habitat outside the designated area is unimportant or may not be needed for recovery of the species. Areas that are important to the conservation of the species, both inside and outside the critical habitat designation, will continue to be subject to: (1) Conservation actions implemented under section 7(a)(1) of the Act, (2) regulatory protections afforded by the requirement in section 7(a)(2) of the Act for Federal agencies to ensure their actions are not likely to jeopardize the continued existence of any endangered or threatened species, and (3) section 9 of the Act's prohibitions on taking any individual of the species, including taking caused by actions that affect habitat. Federally funded or permitted projects affecting listed species outside their designated critical habitat areas may still result in jeopardy findings in some cases. These protections and conservation tools will continue to contribute to recovery of this species. Similarly, critical habitat designations made on the basis of the best available information at the time of designation will not control the direction and substance of future recovery plans, habitat conservation plans (HCPs), or other species conservation planning efforts if new information available at the time of these planning efforts calls for a different outcome.

In accordance with section 3(5)(A)(i) of the Act and regulations at 50 CFR 424.12(b), in determining which areas within the geographical area occupied by the species at the time of listing to designate as critical habitat, we consider the physical or biological features (PBFs) that are essential to the conservation of the species and which may require special management considerations or protection. For example, physical features might include gravel of a particular size required for spawning, alkali soil for seed germination, protective cover for migration, or susceptibility to flooding or fire that maintains necessary early-successional habitat characteristics. Biological features might include prey species, forage grasses, specific kinds or ages of trees for roosting or nesting, symbiotic fungi, or a particular level of nonnative species consistent with conservation needs of the listed species. The features may also be combinations of habitat characteristics and may encompass the relationship between characteristics or the necessary amount of a characteristic needed to support the life history of the species. In considering whether features are essential to the conservation of the species, the Service may consider an appropriate quality, quantity, and spatial and temporal arrangement of habitat characteristics in the context of the life-history needs, condition, and status of the species. These characteristics include, but are not limited to, space for individual and population growth and for normal behavior; food, water, air, light, minerals, or other nutritional or physiological requirements; cover or shelter; sites for breeding, reproduction, or rearing (or development) of offspring; and habitats that are protected from disturbance.

The elfin-woods warbler is an endemic Puerto Rican bird with a very limited distribution. It is typically observed in forested habitats with closed canopy and well-developed understory in higher elevations. Based on the best available information, there are only two known elfin-woods warbler populations, one each in eastern and western Puerto Rico.

The eastern population occurs at El Yunque National Forest (EYNF) located within the Sierra de Luquillo mountains. The species' primary habitat in EYNF consists of the dwarf forest (Kepler and Parkes 1972, pp. 3-5) and the Palo Colorado forest (Wiley and Bauer 1985, pp. 12-18). The dwarf forest falls within the lower montane rain forest life zone (Ewel and Whitmore 1973, p. 49). It is found on exposed peaks with short, stunted vegetation above 900 meters (m) (2,952 feet (ft)) in elevation (Weaver 2012, p. 58). The dwarf forest is characterized by a single story of trees that range from 1 to 6 m (3 to 19 ft) in height, depending on exposure (Weaver 2012, p. 58). However, trees located on rocky summits are limited to 2 to 3 m (6 to 10 ft) in height. Although no tree species is confined to this type of forest, only a few species, such as Podocarpus coriaceus (no common name, referred to as “Podocarpus”), Ocotea spathulata (nemocá), and Ilex sintenisii (no common name), are adapted to survive on the exposed summits of this forest (Weaver 2012, p. 58). The dwarf forest is also characterized by the abundance of mosses, epiphytes, and liverworts that cover the majority of the forest surface (Lugo 2005, p. 514).

The Palo Colorado forest occurs on gentle slopes within the lower montane wet and lower montane rain forest life zones, approximately between 600 and 900 m (1,968 and 2,952 ft) in elevation (Weaver 2012, p. 1; U.S. Forest Service (USFS) no date). This forest type mainly consists of fast-growing trees with heights not exceeding more than 24 m (78 ft) (Lugo 2005, p. 506). This forest type is essentially an upland swamp of short-statured trees with shallow root systems (USFS, no date). Some of the most common tree species are Cyrilla racemiflora (Palo Colorado), Prestoea montana (Sierra palm), Ocotea spathulata, and Croton poecilanthus (sabinón) (Weaver 2012, p. 55). The understory of the Palo Colorado forest is dominated by grasses, bromeliads, ferns, and sedges (Lugo 2005, p. 508).

The western population of the elfin-woods warbler is located within the MCF and adjacent agricultural lands. The MCF is located within the Cordillera Central (central mountain range) of Puerto Rico. The primary habitat of the western population consists of Podocarpus forest, exposed ridge woodland, and timber plantation forests (González 2008, pp. 15-16). The Podocarpus forest is located on the slopes and highest peaks (600 to 900 m (1,968 to 2,952 ft)) within the lower montane wet forest life zone (DNR 1976, p. 185; Ewel and Whitmore 1973, p. 41). At the MCF, this type of forest grows on deep serpentine soils and is dominated by Podocarpus coriaceus trees; a continuous closed canopy of approximately 20 m (66 ft) of height; and a well-developed understory composed of tree ferns ( Cyathea spp.), Sierra palm, and vines (Tossas and Delannoy 2001, pp. 47-53; Anadón-Irizarry 2006, p. 53; González 2008, pp. 15-16). The exposed ridge woodland forest is found in valleys, slopes, and shallow soils with a more or less continuous canopy (González 2008, pp. 15-16). These forest associations are found at elevations ranging from 550 to 750 m (1,804 to 2,460 ft) within the subtropical wet forest life zone (DNR 1976, p. 185; Ricart-Pujals and Padrón-Vélez 2010, p. 9). The timber plantation forest is found in elevations ranging from 630 to 850 m (2,066 to 2,788 ft) within the subtropical wet forest and the subtropical moist forest life zones (DNR 1976, p. 185). Habitat in this forest is predominantly Calophyllum calaba (María trees), Eucalyptus robusta (eucalyptus), and Pinus caribaea (Honduran pine) planted in areas that were deforested for agriculture (Delannoy 2007, p. 9; González 2008, p. 5).

In the privately owned lands adjacent to the MCF, the species has been reported mainly within secondary forests (both young and mature secondary forests) and shade-grown coffee plantations (González 2008, pp. 15-16). The young secondary forests are less than 25 years old with a mostly open canopy approximately 12 to 15 m (40 to 50 ft) in height (González 2008, p. 6). These forests are found within the subtropical moist and subtropical wet forest life zones at elevations ranging from 300 to 750 m (984 to 2,460 ft) (González 2008, p. 59; Puerto Rico Planning Board 2015, no page number), and cover approximately 98 percent of the MCF (DNR 1976, p. 185). The understory is well developed and dominated by grasses, vines, and other early successional species (González 2008, p. 6). Mature secondary forests are over 25 years old, developing in humid and very humid, moderate to steep slopes. These forests are characterized by a closed canopy of approximately 20 to 30 m (66 to 100 ft) in height and sparse to abundant understory (González 2008, p. 6). The shade-grown coffee plantations are covered with tall mature trees, dominated mostly by Inga vera (guaba), Inga laurina (guamá), Andira inermis (moca), and Guarea guidonia (guaraguao) trees, reaching 15 to 20 m (50 to 66 ft) in height, with an open understory without grasses (González 2008, p. 6). Located adjacent to the MCF at elevations between 300 and 600 m (984 and 1,968 ft), these shade-grown coffee plantations extend the vegetation cover and provide habitat for the species (González 2008, p. 59).

According to the habitat suitability model developed for the species, all the habitats described above occur within the intermediate to very high adequacy category (Colón-Merced 2013, p. 57). This model is based on a combination of elevation and vegetation cover in areas where the species is known to occur. In addition, the species appears to be associated with high elevations and is seldom observed in elevations lower than 300 m (984 ft). The habitat types identified above are the only habitats that the species is known to occupy and use for normal behavior that support its life-history processes. Thus, protection and maintenance of these forested habitat features are essential for rearing, growth, foraging, migration, and other normal behaviors of the species.

Limited information is available concerning the elfin-woods warbler's breeding, reproduction, and offspring development. However, based on the best available information, shaded and forested corridors are features that are essential to breeding, reproduction, and rearing. The elfin-woods warbler's breeding occurs between March and June (Raffaele et al. 1998, p. 406). Clutch size is usually two to three eggs, but there have been observations of nests that contain broods of up to four nestlings (Raffaele et al. 1998, p. 406; Rodríguez-Mojica 2004, p. 22). The species' nest is described as a compact cup, usually close to the trunk and well hidden among epiphytes of small trees (Raffaele et al. 1998, p. 406). The first elfin-woods warbler nest was found in 1985 at EYNF (Arroyo-Vázquez 1992, p. 362), and later, two nests were found in the MCF area (Arryo-Vázquez 1992, p. 362). Both nests in the MCF were in Podocarpus forest, placed in trees among dry leaf litter trapped in vegetation or vines at heights between 1.3 and 7.6 m (4.3 and 25.0 ft) (Arroyo-Vázquez 1992, pp. 362-364). In 2004, the first nesting event in a cavity of a rotten Cyrilla racemiflora stump in the MCF area was reported (Rodríguez-Mojica 2004, p. 22). The nest was placed about 7 m (23 ft) above ground and 6 centimeters (cm) (2 inches (in)) deep from the lower border of the irregular rim of the stump. No other warbler species in Puerto Rico have been reported using such a nesting site (Rodríguez-Mojica 2004, p. 23).

Based on the available information describing the habitat used by the elfin-woods warbler, we identified the dwarf, Palo Colorado, Podocarpus, exposed ridge woodland, and timber plantation forests and forest associations (shaded and forested corridors); secondary forests; and shade-grown coffee plantations. These habitats contain physical or biological features that are essential to the conservation of the elfin-woods warbler because they provide space for population growth and normal behavior; cover and shelter; and sites for breeding, rearing, and development of offspring.

We derived the specific physical or biological features (PBFs) essential to the conservation of the elfin-woods warbler from studies of this species' habitat, ecology, and life history as described above. Additional information can be found in the final listing rule published in the Federal Register on June 22, 2016 (81 FR 45035), and in our proposed critical habitat designation, which also published in the Federal Register on June 22, 2016 (81 FR 40632). We have determined that the following PBFs are essential to the conservation of elfin-woods warbler:

1. Wet and rain montane forest types:

a. Podocarpus forest at elevations between 600 and 900 m (1,968 and 2,952 ft) with continuous closed canopy of 20 m (66 ft) in height, dominated by Podocarpus coriaceus trees with well-developed understory.

b. Dwarf forest at elevations above 900 m (2,952 ft) with a single story of trees between 1 and 6 m (3 and 19 ft) in height, with an understory of mosses, epiphytes, and liverworts.

c. Palo Colorado forest at elevations between 600 and 900 m (1,968 and 2,952 ft) with a closed canopy of approximately 20 m (66 ft) and an understory dominated by grasses, ferns, bromeliads, and sedges.

2. Forested habitat areas that contain:

a. Active shade-grown coffee plantations or forested agricultural lands that are above 300 m in elevation and are dominated primarily by native vegetation; or

b. Abandoned coffee plantations or agricultural lands ( i.e., agricultural practices were discontinued) with native forest cover and a closed canopy found above 300 m in elevation.

3. Forested habitat (at elevations between 300 and 850 m (984 and 2,788 ft)) not contained within the habitats described in PBF 1 or PBF 2:

a. Exposed ridge woodland forest found in valleys, slopes, and shallow soils with a more or less continuous canopy at elevations ranging from 550 to 750 m (1,804 to 2,460 ft);

b. Timber plantation forest at elevations ranging from 630 to 850 m (2,066 to 2,788 ft); or

c. Secondary forests dominated by native tree species with a closed canopy of approximately 20-30 m (66-100 ft) in height at elevations ranging from 300 to 750 m (984 to 2,460 ft).

When designating critical habitat, we assess whether the specific areas within the geographical area occupied by the species at the time of listing contain features that are essential to the conservation of the species and may require special management considerations or protection.

The Maricao unit contains privately owned agricultural lands in which various activities may affect one or more of the PBFs. The features of this unit essential to the conservation of the elfin-woods warbler may require special management considerations or protection to reduce the following threats: Loss, fragmentation, and degradation of habitat due to unsustainable agricultural practices; hurricanes; and human-induced fires. The features of the El Yunque unit may require special management considerations or protection to reduce threats or potential threats from hurricanes and human-induced fires, which may be exacerbated by the effects of climate change.

Management activities that could ameliorate these threats or potential threats include but are not limited to the following: The 2014 candidate conservation agreement (CCA) signed by the Service, U.S. Forest Service, and Puerto Rico Department of Natural and Environmental Resources (PRDNER) to implement conservation practices for the benefit of the elfin-woods warbler and its habitat in EYNF and MCF (USFWS 2014); implementation of conservation agreements with private landowners to restore habitat and minimize habitat disturbance and fragmentation; and development and implementation of management plans for other protected lands where the species is found.

As required by section 4(b)(2) of the Act, we use the best scientific data available to designate critical habitat. In accordance with the Act and our implementing regulations at 50 CFR 424.12(b), we review available information pertaining to the habitat requirements of the species and identify specific areas within the geographical area occupied by the species at the time of listing and any specific areas outside the geographical area occupied by the species to be considered for designation as critical habitat.

Because of the vulnerability associated with small populations, limited distributions, or both (as described in the final listing rule), conservation of the elfin-woods warbler requires protection of both existing occupied habitat and potential habitat ( i.e., suitable for occupancy but currently unoccupied), and the establishment of new populations to reduce or eliminate such vulnerability. In this case, we considered potential habitat to be historically occupied areas that currently possess the PBFs suitable for elfin-woods warbler recolonization and subsequent persistence. Therefore, for the elfin-woods warbler, in addition to areas occupied by the species at the time of listing, we are designating habitat outside the geographical area occupied by the species at the time of listing (Unit 3, Carite), which was historically occupied but is presently unoccupied, because it is essential for the conservation of the species and that the area contains one or more of those physical or biological features essential to the conservation of the species.

Sources of data for this critical habitat designation include reports on assessments and surveys throughout the species' range, peer-reviewed scientific and academic literature, habitat suitability models, personal communications with the species experts ( e.g., Colón-Merced 2013; González 2008; Anadón-Irizarry 2006; Delannoy 2007; Arroyo-Vázquez 1992; Pérez-Rivera 2014, pers. comm.); and information from Service biologists. Other sources include databases maintained by Commonwealth and Federal agencies regarding Puerto Rico (such as elevation data, land cover data, aerial imagery, protected areas, and U.S. Geological Survey (USGS) topographic maps). Critical habitat units were then mapped using ArcMap version 10 (Environmental Systems Research Institute, Inc.), a geographic information system (GIS) program.

To further refine the critical habitat boundaries, we used an existing elfin-woods warbler habitat suitability model (Colón-Merced 2013, p. 51). This model uses variables such as elevation and vegetation cover to predict suitable habitat for this species in Puerto Rico (Colón-Merced 2013, p. 45). This model has been validated in several locations in Puerto Rico (Anadón-Irizarry 2017, pp. 7-10; Anadón-Irizarry et al. 2017, entire).

In order to identify essential features within private lands adjacent to the MCF, we established a buffer zone of 500 m (0.31 mile (mi)) from the boundary line of the MCF to include forested areas in abandoned and active shade-grown coffee plantations where the elfin-woods warbler has been reported on the north, east, and west sides of the forest (González 2008, p. 59). We used 500 m (0.31 mi) as our buffer zone, because our best understanding of the available information ( e.g., spatial data and on- the-ground data) is that this area encompasses suitable habitat that supports the conservation of the elfin-woods warbler.

The final critical habitat designation focuses on occupied forested areas within the species' historical range containing the PBFs that will allow for the maintenance and expansion of existing populations and for possible new populations. Two locations meet the definition of geographic areas occupied by the species at the time of listing: (1) EYNF, and (2) MCF and adjacent private lands to the north, east, and west.

To consider for designation areas not occupied by the species at the time of the listing, we must demonstrate that these areas are essential for the conservation of the species and that the area contains one or more of those physical or biological features essential to the conservation of the species. To determine if these areas are essential for the conservation of the elfin-woods warbler, we considered the life history, status, habitat elements, and conservation needs of the species such as:

(1) The importance of the area to the overall status of the species to prevent extinction and contribute to the species' conservation;

(2) Whether the area contains the necessary habitat to support the species;

(3) Whether the area provides connectivity between occupied sites for genetic exchange; and

(4) Whether a population of the species could be reestablished in the area.

The Carite Commonwealth Forest (CCF) is within the historical range of the elfin-woods warbler, within the Sierra de Cayey mountains in southeast Puerto Rico (Silander et al. 1986, p. 178); the Sierra de Cayey mountains are connected to the Cordillera Central mountains, which extend from Aibonito in the east to Maricao in the west of Puerto Rico (Monroe 1980, p. 16). However, the species has not been reported in CCF since 2000 (Anadón-Irizarry 2006, p. 34; Pérez-Rivera 2014, pers. comm.; Aide and Campos 2016, entire).

The CCF has been managed for conservation by the PRDNER since 1975 (previously Department of Natural Resources (DNR); DNR 1976, p. 169). This forest covers about 6,660 ac (2,695 ha), and ranges between 820 and 2,962 ft (250 and 903 m) in elevation (DNR 1976, p. 168). The mean annual precipitation is 225 cm (88.5 in), and the mean temperature is 72.3 degrees Fahrenheit (°F) (22.7 degrees Celsius (°C)) (DNR 1976, p. 169; Silander et al. 1986, p. 183).

The CCF contains the following forest types, which contain the PBFs for the elfin-woods warbler: Dwarf forest, Palo Colorado forest, timber plantation forest, and secondary forests. These are the same forest types used by the elfin-woods warbler in EYNF and MCF and are located within the same life zones in CCF as they are in EYNF and MCF (Ewel and Whitmore 1973, p. 74).

Although studies conducted by Anadón-Irizarry (2006, 2014) between 2003-2004 and 2012-2013 failed to detect the species within the CCF, she suggested the possibility that the species may still be present in isolated pockets of forest that were not searched during those studies. The elfin-woods warbler may be difficult to detect owing to its persistent and relatively sedentary behavior and because it has an affinity for certain small and isolated pockets of forest (Anadón-Irizarry 2006, p. 54; Delannoy 2007, pp. 22-23; Pérez-Rivera 2014, pers. comm.). However, surveys contracted by the Service and conducted between March and April 2016 did not detect the species within the CCF and adjacent private lands (Aide and Campos 2016, entire). In any case, the CCF contains habitat that is likely suitable for the elfin-woods warbler due to its similarity in elevation, climatic conditions, and vegetation associations with EYNF and MCF (Colón-Merced 2013, p. 57). This area contains habitat with “intermediate to very high adequacy” (favorable to optimal combination of elevation and vegetation cover in the known elfin-woods warbler habitat) according to the habitat suitability model for the species (Colón-Merced 2013, p. 57).

The CCF provides the necessary habitat to support the elfin-woods warbler in the easternmost part of the Cordillera Central. The presence of suitable habitat characteristics and historic occurrence of the species within the CCF increases the opportunity for future reestablishment of a population of elfin-woods warblers in this forest. In addition, the connectivity between MCF and CCF through the Cordillera Central is expected to result in genetic exchange between the existing MCF populations and CCF populations that may be reestablished in the future. While there is connectivity between MCF and CCF, the EYNF is within the Sierra de Luquillo mountains with lower elevation and development between the mountain ranges that significantly reduces connectivity between CCF and EYNF. For the above-mentioned reasons, we conclude that suitable habitat within the CCF meets the four considerations described above, and is therefore essential for the conservation of the elfin-woods warbler.

When determining critical habitat boundaries within this final rule, we made every effort to avoid including developed areas such as lands covered by buildings, pavement, and other structures because such lands lack physical or biological features necessary for elfin-woods warbler. The scale of the maps we prepared under the parameters for publication within the Code of Federal Regulations may not reflect the exclusion of such developed lands. Any such lands inadvertently left inside critical habitat boundaries shown on the maps of this final rule have been excluded by text in the rule and are not designated as critical habitat. Therefore, a Federal action involving these lands will not trigger section 7 consultation with respect to critical habitat and the requirement of no adverse modification unless the specific action would affect the physical or biological features in the adjacent critical habitat.

We are designating as critical habitat in areas that we have determined were occupied at the time of listing in 2016 and contain physical or biological features to support life-history processes essential to the conservation of the species. We are also designating specific areas within one unit outside of the geographical area occupied by the species at the time of listing, which were historically occupied but are presently unoccupied, because we have determined that such areas are essential for the conservation of elfin-woods warbler and that the area contains one or more of those physical or biological features essential to the conservation of the warbler.

All units were designated based on one or more of the elements of physical or biological features being present to support elfin-woods warbler's life processes. Some units contained all of the identified elements of physical or biological features and supported multiple life processes. Some units contained only some elements of the physical or biological features necessary to support the elfin-woods warbler's particular use of that habitat.

The critical habitat designation is defined by the map or maps, as modified by any accompanying regulatory text, presented at the end of this document under Regulation Promulgation. We include more detailed information on the boundaries of the critical habitat designation in the discussion of individual units below. We will make the coordinates or plot points or both on which each map is based available to the public on http://www.regulations.gov under Docket No. FWS-R4-ES-2020-0030 and at http://www.fws.gov/caribbean.

We are designating approximately 27,488 acres (11,125 hectares) in three units as critical habitat for elfin-woods warbler. The critical habitat areas described below constitute our best assessment of areas that meet the definition of critical habitat for the elfin-woods warbler. Those three units are: (1) Maricao, (2) El Yunque, and (3) Carite. Table 1 shows the name, occupancy of the unit, municipality, land ownership, and approximate area of the designated critical habitat units for the elfin-woods warbler.

We present brief descriptions of all units, and reasons why they meet the definition of critical habitat for elfin-woods warbler, below.

Unit 1 consists of 12,978 ac (5,252 ha). Approximately 8,861 ac (3,586 ha) are owned by the Commonwealth and managed by the PRDNER, and 4,117 ac (1,666 ha) are in private ownership. This unit is located within the municipalities of Maricao, San Germán, Sabana Grande, and Yauco and encompasses the majority of the Maricao Commonwealth Forest. The unit is located north of State Road PR-2, south of State Road PR-105, and approximately 65 miles (mi) (105 kilometers (km)) west of the International Airport Luis Muñoz Marin. This unit is within the geographical area occupied by the elfin-woods warbler at the time of listing. This unit contains all the PBFs and a core population of the species, and will likely contribute to range expansion of the elfin-woods warbler by serving as a source of birds to found elfin-woods warbler populations in Carite, which is currently unoccupied but contains the PBFs.

The PBFs in this unit may require special considerations or protection to address the following threats or potential threats that may result in changes in the composition or abundance of vegetation within this unit: Loss, fragmentation, and degradation of habitat due to unsustainable agricultural practices; hurricanes; and human-induced fires.

Unit 2 consists of 11,430 ac (4,626 ha) of federally owned land managed by the U.S. Forest Service (EYNF). It is located within the municipalities of Río Grande, Canovanas, Las Piedras, Naguabo, and Ceiba. The unit is located east of State Road PR-186, north of State Road PR-31, and approximately 15 mi (24 km) east of the International Airport Luis Muñoz Marin. This unit is within the geographical area occupied by the elfin-woods warbler at the time of listing and contains PBFs 1(b) and 1(c) (see Physical or Biological Features Essential to the Conservation of the Species, above). This unit represents a core population of the species and helps to maintain the elfin-woods warbler's geographical range.

The PBFs in this unit may require special considerations or protection to reduce threats or potential threats from hurricanes and human-induced fires, which may be exacerbated by the effects of climate change.

Unit 3 consists of 3,080 ac (1,247 ha) of lands owned by the Commonwealth and managed by the PRDNER. It is located within the municipalities of Cayey, San Lorenzo, Guayama, and Patillas. The unit is located within the CCF west of State Road PR-7740 and State Road PR-184 that runs within the CCF, and approximately 23 mi (37 km) south of the International Airport Luis Muñoz Marin. This unit was not occupied by the elfin-woods warbler at the time of listing and is considered to be essential for the conservation of the species. As discussed above (see Criteria Used to Identify Critical Habitat), this unit currently has the habitat features, including all of the PBFs, to support the elfin-woods warbler. Therefore, this unit provides an opportunity for expansion of the species' documented current range into an area that was previously occupied; this potential expansion will help to increase the redundancy and resiliency of the species. Therefore, we conclude that this unit is essential for the conservation of the elfin-woods warbler.

Section 7(a)(2) of the Act requires Federal agencies, including the Service, to ensure that any action they fund, authorize, or carry out is not likely to jeopardize the continued existence of any endangered species or threatened species or result in the destruction or adverse modification of designated critical habitat of such species. In addition, section 7(a)(4) of the Act requires Federal agencies to confer with the Service on any agency action which is likely to jeopardize the continued existence of any species proposed to be listed under the Act or result in the destruction or adverse modification of proposed critical habitat.

We published a final regulation with a revised definition of destruction or adverse modification on August 27, 2019 (84 FR 44976). Destruction or adverse modification means a direct or indirect alteration that appreciably diminishes the value of critical habitat as a whole for the conservation of a listed species.

If a Federal action may affect a listed species or its critical habitat, the responsible Federal agency (action agency) must enter into consultation with us. Examples of actions that are subject to the section 7 consultation process are actions on State, tribal, local, or private lands that require a Federal permit (such as a permit from the U.S. Army Corps of Engineers under section 404 of the Clean Water Act (33 U.S.C. 1251 et seq. ) or a permit from the Service under section 10 of the Act) or that involve some other Federal action (such as funding from the Federal Highway Administration, Federal Aviation Administration, or the Federal Emergency Management Agency). Federal actions not affecting listed species or critical habitat—and actions on State, tribal, local, or private lands that are not federally funded, authorized, or carried out by a Federal agency—do not require section 7 consultation.

Compliance with the requirements of section 7(a)(2) is documented through our issuance of:

(1) A concurrence letter for Federal actions that may affect, but are not likely to adversely affect, listed species or critical habitat; or

(2) A biological opinion for Federal actions that may affect and are likely to adversely affect, listed species or critical habitat.

When we issue a biological opinion concluding that a project is likely to jeopardize the continued existence of a listed species and/or destroy or adversely modify critical habitat, we provide reasonable and prudent alternatives to the project, if any are identifiable, that would avoid the likelihood of jeopardy and/or destruction or adverse modification of critical habitat. We define “reasonable and prudent alternatives” (at 50 CFR 402.02) as alternative actions identified during consultation that:

(1) Can be implemented in a manner consistent with the intended purpose of the action,

(2) Can be implemented consistent with the scope of the Federal agency's legal authority and jurisdiction,

(3) Are economically and technologically feasible, and

(4) Would, in the Director's opinion, avoid the likelihood of jeopardizing the continued existence of the listed species and/or avoid the likelihood of destroying or adversely modifying critical habitat.

Reasonable and prudent alternatives can vary from slight project modifications to extensive redesign or relocation of the project. Costs associated with implementing a reasonable and prudent alternative are similarly variable.

Regulations at 50 CFR 402.16 set forth requirements for Federal agencies to reinitiate formal consultation on previously reviewed actions. These requirements apply when the Federal agency has retained discretionary involvement or control over the action (or the agency's discretionary involvement or control is authorized by law) and, subsequent to the previous consultation, we have listed a new species or designated critical habitat that may be affected by the Federal action, or the action has been modified in a manner that affects the species or critical habitat in a way not considered in the previous consultation. In such situations, Federal agencies sometimes may need to request reinitiation of consultation with us, but the regulations also specify some exceptions to the requirement to reinitiate consultation on specific land management plans after subsequently listing a new species or designating new critical habitat. See the regulations for a description of those exceptions.

The key factor related to the destruction or adverse modification determination is whether implementation of the proposed Federal action directly or indirectly alters the designated critical habitat in a way that appreciably diminishes the value of the critical habitat as a whole for the conservation of the listed species. As discussed above, the role of critical habitat is to support physical or biological features essential to the conservation of a listed species and provide for the conservation of the species.

Section 4(b)(8) of the Act requires us to briefly evaluate and describe, in any proposed or final regulation that designates critical habitat, activities involving a Federal action that may violate section 7(a)(2) of the Act by destroying or adversely modifying such habitat, or that may be affected by such designation.

Activities that the Services may, during a consultation under section 7(a)(2) of the Act, find are likely to destroy or adversely modify critical habitat include, but are not limited to:

(1) Actions that would significantly alter the structure and function of active shade-grown coffee plantations, abandoned coffee plantations, and/or agricultural lands with native forest cover and a closed canopy. These actions or activities may include, but are not limited to, deforestation, conversion of shade-grown coffee to sun-grown coffee plantations, and unsustainable agricultural practices ( i.e., agricultural and silvicultural practices other than sun-to-shade-grown coffee conversion, and herbicide and pesticide use outside coffee plantations). These actions could degrade the habitat used by the elfin-woods warbler for feeding, reproducing, and sheltering.

(2) Actions that would significantly alter the vegetation structure in and around the Podocarpus, dwarf, or Palo Colorado forests and forest associations. These actions or activities may include, but are not limited to, habitat modification ( e.g., deforestation, fragmentation, loss, introduction of nonnative species, expansion or construction of communication facilities, expansion of recreational facilities, pipeline construction, bridge construction, road rehabilitation and maintenance, habitat management), Federal and State trust species reintroductions, trail maintenance, camping area maintenance, research, repair and restoration of landslides, and any other activities that are not conducted in accordance with the consultation and planning requirements for listed species under section 7 of the Act. These activities could alter the habitat structure essential to the elfin-woods warbler and may create suitable conditions for other species that compete with or prey upon the elfin-woods warbler or displace the species from its habitat.

Section 4(a)(3)(B)(i) of the Act (16 U.S.C. 1533(a)(3)(B)(i)) provides that: “The Secretary shall not designate as critical habitat any lands or other geographical areas owned or controlled by the Department of Defense, or designated for its use, that are subject to an integrated natural resources management plan (INRMP) prepared under section 101 of the Sikes Act (16 U.S.C. 670a), if the Secretary determines in writing that such plan provides a benefit to the species for which critical habitat is proposed for designation.” There are no Department of Defense lands with a completed INRMP within the final critical habitat designation.

Section 4(b)(2) of the Act states that the Secretary shall designate and make revisions to critical habitat on the basis of the best available scientific data after taking into consideration the economic impact, national security impact, and any other relevant impact of specifying any particular area as critical habitat. The Secretary may exclude an area from critical habitat if he determines that the benefits of such exclusion outweigh the benefits of specifying such area as part of the critical habitat, unless he determines, based on the best scientific data available, that the failure to designate such area as critical habitat will result in the extinction of the species. In making that determination, the statute on its face, as well as the legislative history, are clear that the Secretary has broad discretion regarding which factor(s) to use and how much weight to give to any factor.

The first sentence in section 4(b)(2) of the Act requires that we take into consideration the economic, national security, or other relevant impacts of designating any particular area as critical habitat. We describe below the process that we undertook for taking into consideration each category of impacts and our analyses of the relevant impacts.

Section 4(b)(2) of the Act and its implementing regulations require that we consider the economic impact that may result from a designation of critical habitat. To assess the probable economic impacts of a designation, we must first evaluate specific land uses or activities and projects that may occur in the area of the critical habitat. We then must evaluate the impacts that a specific critical habitat designation may have on restricting or modifying specific land uses or activities for the benefit of the species and its habitat within the areas proposed. We then identify which conservation efforts may be the result of the species being listed under the Act versus those attributed solely to the designation of critical habitat for this particular species. The probable economic impact of a proposed critical habitat designation is analyzed by comparing scenarios both “with critical habitat” and “without critical habitat.”

The “without critical habitat” scenario represents the baseline for the analysis, which includes the existing regulatory and socio-economic burden imposed on landowners, managers, or other resource users potentially affected by the designation of critical habitat ( e.g., under the Federal listing as well as other Federal, State, and local regulations). The baseline, therefore, represents the costs of all efforts attributable to the listing of the species under the Act ( i.e., conservation of the species and its habitat incurred regardless of whether critical habitat is designated). The “with critical habitat” scenario describes the incremental impacts associated specifically with the designation of critical habitat for the species. The incremental conservation efforts and associated impacts would not be expected without the designation of critical habitat for the species. In other words, the incremental costs are those attributable solely to the designation of critical habitat, above and beyond the baseline costs. These are the costs we use when evaluating the benefits of inclusion and exclusion of particular areas from the final designation of critical habitat should we choose to conduct a discretionary 4(b)(2) exclusion analysis.

For this particular designation, we developed an incremental effects memorandum (IEM) considering the probable incremental economic impacts that may result from the proposed designation of critical habitat. The information contained in our IEM was then used to develop a screening analysis of the probable effects of the designation of critical habitat for the elfin-woods warbler (Abt Associates, Inc. 2016). We began by conducting a screening analysis of the proposed designation of critical habitat in order to focus our analysis on the key factors that are likely to result in incremental economic impacts. The purpose of the screening analysis is to filter out particular geographic areas of critical habitat that are already subject to such protections and are, therefore, unlikely to incur incremental economic impacts. In particular, the screening analysis considers baseline costs ( i.e., absent critical habitat designation) and includes probable economic impacts where land and water use may be subject to conservation plans, land management plans, best management practices, or regulations that protect the habitat area as a result of the Federal listing status of the species. Ultimately, the screening analysis allows us to focus our analysis on evaluating the specific areas or sectors that may incur probable incremental economic impacts as a result of the designation. The screening analysis also assesses whether units are unoccupied by the species and thus may require additional management or conservation efforts as a result of the critical habitat designation for the species; these additional efforts may incur incremental economic impacts. This screening analysis combined with the information contained in our IEM are what we consider our draft economic analysis (DEA) of the proposed critical habitat designation for the elfin-woods warbler; our DEA is summarized in the narrative below. The DEA, dated March 7, 2016, was made available for public review from June 23, 2016, through August 22, 2016 (81 FR 40632). We did not receive any public comments on the DEA. A copy of the DEA may be obtained by contacting the Caribbean Ecological Services Field Office (see ADDRESSES ) or by downloading from the internet at http://www.regulations.gov.

Executive Orders (E.O.s) 12866 and 13563 direct Federal agencies to assess the costs and benefits of available regulatory alternatives in quantitative (to the extent feasible) and qualitative terms. Consistent with the E.O. regulatory analysis requirements, our effects analysis under the Act may take into consideration impacts to both directly and indirectly affected entities, where practicable and reasonable. If sufficient data are available, we assess to the extent practicable the probable impacts to both directly and indirectly affected entities. As part of our screening analysis, we considered the types of economic activities that are likely to occur within the areas likely affected by the critical habitat designation. In our evaluation of the probable incremental economic impacts that may result from the proposed designation of critical habitat for the elfin-woods warbler, first we identified, in the IEM dated December 7, 2015, probable incremental economic impacts associated with the following categories of activities: Forest management, silviculture/timber management, implementation of conservation/restoration practices, human-induced fire management, development or improvement of existing infrastructure ( e.g., roads, water intakes, water pipelines, electric transmission lines), recreation facilities, agriculture, and single house development funded by the U.S. Department of Housing and Urban Development (HUD). We considered each industry or category individually. Additionally, we considered whether their activities have any Federal involvement. Critical habitat designation generally will not affect activities that do not have any Federal involvement; under the Act, designation of critical habitat only affects activities conducted, funded, permitted, or authorized by Federal agencies. In areas where the elfin-woods warbler is present, Federal agencies already are required to consult with the Service under section 7 of the Act on activities they fund, permit, or implement that may affect the species. When this final critical habitat designation rule becomes effective, consultations to avoid the destruction or adverse modification of critical habitat will be incorporated into the existing consultation process.

In our IEM, we attempted to clarify the distinction between the effects that will result from the species being listed and those attributable to the critical habitat designation ( i.e., difference between the jeopardy and adverse modification standards) for the elfin-woods warbler's critical habitat. Because the majority of the critical habitat units are already managed for the conservation of natural resources, all units have co-occurring federally listed species, and two of the three units are occupied by the elfin-woods warbler, it is unlikely that costs will result from section 7 consultations considering critical habitat alone, consultations resulting in adverse modifications alone, or project modifications attributable to critical habitat alone. The only incremental costs predicted are the administrative costs due to additional consideration of adverse modification of critical habitat during section 7 consultations.

Based on estimates from existing section 7 consultations on a surrogate listed species, the Puerto Rican sharp-shinned hawk, the DEA predicts that 5.4 requests for technical assistance, 2.4 informal consultations, and 0.6 formal consultations per year will consider critical habitat for the elfin-woods warbler. The 363 ac (146.9 ha) we are including in Unit 1 of our critical habitat designation, after the proposed designation and DEA were complete, does not significantly alter the economic predictions. Within this 363 ac, there have been no consultations and one species list request in the past 5 years.

In addition, because there are other federally listed species in all units of the critical habitat for elfin-woods warbler, the Service finds that the designation of critical habitat for the elfin-woods warbler is unlikely to lead to changes in permitting processes by Commonwealth or local agencies or other land managers.

We note that “any project modifications or conservation measures recommended to prevent adverse modification of the elfin-woods warbler's critical habitat will not differ from project modifications and conservation measures recommended to prevent the jeopardy of other federally listed co-occurring species in the area ( e.g., Puerto Rican sharp-shinned hawk)” (Abt Associates, Incorporated 2016, p. 11). Federally listed species occupy areas in the three critical habitat units for the elfin-woods warbler. Therefore, we do not expect substantial impacts within any geographic area or to any sector as a result of this critical habitat designation.

Based on peer review comments that identified an area that is occupied by the species and has the PBFs that support the species, we added 363 ac (146.9 ha) to proposed critical habitat in Unit 1 (Maricao). This added area consists of 355 ac within lands managed for conservation by the Puerto Rico Department of Natural and Environmental Resources, with the remaining 8 ac privately owned. The incremental economic effects of this addition are minimal, because the area being added is 1.3 percent of the total critical habitat, predominantly contains lands managed for conservation, and harbors federally listed species covered under section 7 of the Act.

Based on the finding that the critical habitat designation will have minimal impact on land use or other activities ( i.e., there is little incremental difference due to the designation), the DEA concludes that benefits will also be minimal. Possible benefits, aside from the conservation of elfin-woods warbler, could include cultural heritage benefits and other non-use benefits. Due to limited data availability, however, the DEA does not monetize these benefits.

The first sentence of section 4(b)(2) of the Act requires the Service to consider the economic impacts (as well as the impacts on national security and any other relevant impacts) of designating critical habitat. In addition, economic impacts may, for some particular areas, play an important role in the discretionary section 4(b)(2) exclusion analysis under the second sentence of section 4(b)(2). In both contexts, the Service has considered the probable incremental economic impacts of the designation. When the Service undertakes a discretionary section 4(b)(2) exclusion analysis with respect to a particular area, we weigh the economic benefits of exclusion (and any other benefits of exclusion) against any benefits of inclusion (primarily the conservation value of designating the area). The conservation value may be influenced by the level of effort needed to manage degraded habitat to the point where it could support the listed species.

The Service uses its discretion in determining how to weigh probable incremental economic impacts against conservation value. The nature of the probable incremental economic impacts, and not necessarily a particular threshold level, triggers considerations of exclusions based on probable incremental economic impacts. For example, if an economic analysis indicates high probable incremental impacts of designating a particular critical habitat unit of lower conservation value (relative to the remainder of the designation), the Service may consider exclusion of that particular unit.

As discussed above, the Service considered the economic impacts of the critical habitat designation and the Secretary is not exercising his discretion to exclude any areas from this designation of critical habitat for the elfin-woods warbler based on economic impacts.

Under section 4(b)(2) of the Act, we consider whether there are lands where a national security impact might exist. We have determined that the lands within the final designation of critical habitat for the elfin-woods warbler are not owned or managed by the Department of Defense or Department of Homeland Security, and, therefore, we anticipate no impact on national security. Consequently, the Secretary is not exercising his discretion to exclude any areas from the final designation based on impacts on national security.

Under section 4(b)(2) of the Act, we consider any other relevant impacts, in addition to economic impacts and impacts on national security. We consider a number of factors including whether there are permitted conservation plans covering the species in the area such as HCPs, safe harbor agreements, or candidate conservation agreements with assurances, or whether there are non-permitted conservation agreements and partnerships that would be encouraged by designation of, or exclusion from, critical habitat. In addition, we look at the existence of tribal conservation plans and partnerships and consider the government-to-government relationship of the United States with tribal entities. We also consider any social impacts that might occur because of the designation.

In preparing this final rule, we have determined that some areas within the final designation are included in management plans or other conservation agreements such as the Service's Wildlife Conservation Extension Agreements with private landowners, Natural Resources Conservation Service's conservation contracts with private landowners, cooperative agreements with nongovernmental organizations (NGOs), and the CCA signed at the end of 2014 among the Service, U.S. Forest Service, and PRDNER to implement conservation practices for the recovery of the elfin-woods warbler within EYNF and MCF.

Although the initiatives with private landowners and NGOs promote the restoration and enhancement of elfin-woods warbler habitat adjacent to the EYNF and MCF, potential challenges such as limited resources and uncertainty about landowners' participation may affect the implementation of conservation practices that mitigate impacts of agricultural practices and ensure the conservation of the species' essential habitat. We do not anticipate any negative effects of designating critical habitat in areas where existing partnerships occur. Further, there are no tribal lands in Puerto Rico. Therefore, the Secretary is not exercising his discretion to exclude any areas from the final designation based on other relevant impacts.

Executive Order 12866 provides that the Office of Information and Regulatory Affairs in the Office of Management and Budget (OMB) will review all significant rules. The Office of Information and Regulatory Affairs has waived their review regarding their significance determination of this rule.

Executive Order 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 rule in a manner consistent with these requirements.

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 manufacturing and mining concerns with fewer than 500 employees, wholesale trade entities with fewer than 100 employees, retail and service businesses with less than $5 million in annual sales, general and heavy construction businesses with less than $27.5 million in annual business, special trade contractors doing less than $11.5 million in annual business, and agricultural businesses with annual sales less than $750,000. To determine if potential economic impacts to these small entities are significant, we considered the types of activities that might trigger regulatory impacts under this designation as well as types of project modifications that may result. In general, the term “significant economic impact” is meant to apply to a typical small business firm's business operations.

Under the RFA, as amended, and as understood in the light of recent court decisions, Federal agencies are required to evaluate the potential incremental impacts of rulemaking only on those entities directly regulated by the rulemaking itself and, therefore, are not required to evaluate the potential impacts to indirectly regulated entities. The regulatory mechanism through which critical habitat protections are realized is section 7 of the Act, which requires Federal agencies, in consultation with the Service, to ensure that any action authorized, funded, or carried out by the agency is not likely to destroy or adversely modify critical habitat. Therefore, under section 7, only Federal action agencies are directly subject to the specific regulatory requirement (avoiding destruction and adverse modification) imposed by critical habitat designation. Consequently, it is our position that only Federal action agencies will be directly regulated by this designation. There is no requirement under RFA to evaluate the potential impacts to entities not directly regulated. Moreover, Federal agencies are not small entities. Therefore, because no small entities are directly regulated by this rulemaking, the Service certifies that the final critical habitat designation will not have a significant economic impact on a substantial number of small entities.

During the development of this final rule, we reviewed and evaluated all information submitted during the comment period that may pertain to our consideration of the probable incremental economic impacts of this critical habitat designation. Based on this information, we affirm our certification that this final critical habitat designation will not have a significant economic impact on a substantial number of small entities, and a regulatory flexibility analysis is not required.

We do not believe this 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, the Office of Information and Regulatory Affairs has waived their review regarding their E.O. 12866 significance determination of this rule.

Executive Order 13211 (Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use) requires agencies to prepare Statements of Energy Effects when undertaking certain actions. OMB has provided guidance for implementing this Executive Order that outlines nine outcomes that may constitute “a significant adverse effect” when compared to not taking the regulatory action under consideration. Our economic analysis finds that none of these criteria are relevant to this analysis. Thus, based on information in the economic analysis, energy-related impacts associated with elfin-woods warbler conservation activities within critical habitat are not expected. As such, the designation of critical habitat is not expected to significantly affect energy supplies, distribution, or use. Therefore, this action is not a significant energy action, and no Statement of Energy Effects is required.

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

(1) This rule will not produce a Federal mandate. In general, a Federal mandate is a provision in legislation, statute, or regulation that would impose an enforceable duty upon State, local, or tribal governments, or the private sector, and includes both “Federal intergovernmental mandates” and “Federal private sector mandates.” These terms are defined in 2 U.S.C. 658(5)-(7). “Federal intergovernmental mandate” includes a regulation that “would impose an enforceable duty upon State, local, or tribal governments” with two exceptions. It excludes “a condition of Federal assistance.” It also excludes “a duty arising from participation in a voluntary Federal program,” unless the regulation “relates to a then-existing Federal program under which $500,000,000 or more is provided annually to State, local, and tribal governments under entitlement authority,” if the provision would “increase the stringency of conditions of assistance” or “place caps upon, or otherwise decrease, the Federal Government's responsibility to provide funding,” and the State, local, or tribal governments “lack authority” to adjust accordingly. At the time of enactment, these entitlement programs were: Medicaid; Aid to Families with Dependent Children work programs; Child Nutrition; Food Stamps; Social Services Block Grants; Vocational Rehabilitation State Grants; Foster Care, Adoption Assistance, and Independent Living; Family Support Welfare Services; and Child Support Enforcement. “Federal private sector mandate” includes a regulation that “would impose an enforceable duty upon the private sector, except (i) a condition of Federal assistance or (ii) a duty arising from participation in a voluntary Federal program.”

The designation of critical habitat does not impose a legally binding duty on non-Federal Government entities or private parties. Under the Act, the only regulatory effect is that Federal agencies must ensure that their actions do not destroy or adversely modify critical habitat under section 7. While non-Federal entities that receive Federal funding, assistance, or permits, or that otherwise require approval or authorization from a Federal agency for an action, may be indirectly impacted by the designation of critical habitat, the legally binding duty to avoid destruction or adverse modification of critical habitat rests squarely on the Federal agency. Furthermore, to the extent that non-Federal entities are indirectly impacted because they receive Federal assistance or participate in a voluntary Federal aid program, the Unfunded Mandates Reform Act would not apply, nor would critical habitat shift the costs of the large entitlement programs listed above onto State governments.

(2) We do not believe that this rule will significantly or uniquely affect small governments because the majority of the critical habitat units are already managed for natural resource conservation by the Federal government or the Commonwealth of Puerto Rico, and all critical habitat units have co-occurring federally listed species that are already being considered by the Commonwealth and municipalities for any actions proposed in the area. Therefore, a Small Government Agency Plan is not required.

In accordance with E.O. 12630 (Government Actions and Interference with Constitutionally Protected Private Property Rights), we have analyzed the potential takings implications of designating critical habitat for elfin-woods warbler in a takings implications assessment. The Act does not authorize the Service to regulate private actions on private lands or confiscate private property as a result of critical habitat designation. Designation of critical habitat does not affect land ownership, or establish any closures, or restrictions on use of or access to the designated areas. Furthermore, the designation of critical habitat does not affect landowner actions that do not require Federal funding or permits, nor does it preclude development of habitat conservation programs or issuance of incidental take permits to permit actions that do require Federal funding or permits to go forward. However, Federal agencies are prohibited from carrying out, funding, or authorizing actions that would destroy or adversely modify critical habitat. A takings implications assessment has been completed and concludes that this designation of critical habitat for elfin-woods warbler does not pose significant takings implications for lands within or affected by the designation.

In accordance with E.O. 13132 (Federalism), this rule does not have significant Federalism effects. A Federalism assessment is not required. In keeping with Department of the Interior and Department of Commerce policy, we requested information from, and coordinated development of the proposed critical habitat designation with, appropriate State resource agencies in Puerto Rico. We did not receive comments from Federal agencies for this rule. From a federalism perspective, the designation of critical habitat directly affects only the responsibilities of Federal agencies. The Act imposes no other duties with respect to critical habitat, either for States and local governments, or for anyone else. As a result, the rule does not have substantial direct effects either on the States, or on the relationship between the national government and the States, or on the distribution of powers and responsibilities among the various levels of government. The designation may have some benefit to these governments because the areas that contain the features essential to the conservation of the species are more clearly defined, and the physical or biological features of the habitat necessary to the conservation of the species are specifically identified. This information does not alter where and what federally sponsored activities may occur. However, it may assist these local governments in long-range planning because they no longer have to wait for case-by-case section 7 consultations to occur.

Where State and local governments require approval or authorization from a Federal agency for actions that may affect critical habitat, consultation under section 7(a)(2) would be required. While non-Federal entities that receive Federal funding, assistance, or permits, or that otherwise require approval or authorization from a Federal agency for an action, may be indirectly impacted by the designation of critical habitat, the legally binding duty to avoid destruction or adverse modification of critical habitat rests squarely on the Federal agency.

In accordance with Executive Order 12988 (Civil Justice Reform), the Office of the Solicitor has determined that the rule does not unduly burden the judicial system and that it meets the requirements of sections 3(a) and 3(b)(2) of the Order. We are designating critical habitat in accordance with the provisions of the Act. To assist the public in understanding the habitat needs of the species, this rule identifies the elements of physical or biological features essential to the conservation of the elfin-woods warbler. The designated areas of critical habitat are presented on maps, and the rule provides several options for the interested public to obtain more detailed location information, if desired.

This rule does not contain information collection requirements, and a submission to the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ) is not required. 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.

It is our position that, outside the jurisdiction of the U.S. Court of Appeals for the Tenth Circuit, we do not need to prepare environmental analyses pursuant to the National Environmental Policy Act (NEPA; 42 U.S.C. 4321 et seq. ) in connection with designating critical habitat under the Act. We published a notice outlining our reasons for this determination in the Federal Register on October 25, 1983 (48 FR 49244). This position was upheld by the U.S. Court of Appeals for the Ninth Circuit ( Douglas County v. Babbitt, 48 F.3d 1495 (9th Cir. 1995), cert. denied 516 U.S. 1042 (1996)).

In accordance with the President's memorandum of April 29, 1994 (Government-to-Government Relations with Native American Tribal Governments; 59 FR 22951), Executive Order 13175 (Consultation and Coordination With Indian Tribal Governments), and the Department of the Interior's manual at 512 DM 2, we readily acknowledge our responsibility to communicate meaningfully with recognized Federal Tribes on a government-to-government basis. In accordance with Secretarial Order 3206 of June 5, 1997 (American Indian Tribal Rights, Federal-Tribal Trust Responsibilities, and the Endangered Species Act), we readily acknowledge our responsibilities to work directly with tribes in developing programs for healthy ecosystems, to acknowledge that tribal lands are not subject to the same controls as Federal public lands, to remain sensitive to Indian culture, and to make information available to tribes. As discussed above, there are no tribal lands in Puerto Rico, and therefore, we have identified no tribal interests that will be affected by this final rulemaking.

A complete list of all references cited is available on the internet at http://www.regulations.gov under Docket No. FWS-R4-ES-2020-0030 and upon request from the Caribbean Ecological Services Field Office (see FOR FURTHER INFORMATION CONTACT ).

The primary authors of this rule are the staff members of the U.S. Fish and Wildlife Service's Species Assessment Team and the Caribbean Ecological Services Field Office.

Accordingly, we amend part 17, subchapter B of chapter I, title 50 of the Code of Federal Regulations, as set forth below: