I. Need for Corrections

The Agency published a final rule on July 14, 2020, (85 FR 42494—42580) for the purpose of implementing a unified guaranteed loan platform for enhanced delivery of four of its existing guaranteed loan programs: Community Facilities (CF) administered by the Rural Housing Service; Water and Waste Disposal (WWD) administered by the Rural Utilities Service; and, Business and Industry (B&I) and Rural Energy for America Program (REAP) administered by the Rural Business-Cooperative Service. The Agency discovered that errors and omissions were made during the drafting process that impact the successful implementation of this regulation. The following items will be addressed in this technical correction:

The removal of Supplementary Information language referring to a reduced guarantee in the Agency's response to a question regarding issuance of the loan note guarantee prior to the completion of construction. The Agency determined that the reduction is not necessary due to implementation of other risk mitigation measures.

Modifying language at § 5001.2 (e) to clarify intent.

Division B, Title I of the CARES Act supplemented existing authority in 7 CFR part 4279 for the Business and Industry program and was implemented after development of the OneRD final rule, but prior to the effective date of the OneRD rule. In order to continue to administer loans authorized under the CARES Act, 7 CFR part 4279 and Subpart B of Part 4287 are still needed. Therefore, it is necessary to remove Supplementary Information language and delete the amendment to remove and reserve 7 CFR part 4279 and Subpart B of 7 CFR part 4287. These parts continue to be necessary to originate Business & Industry CARES Act Program loans, and service Business and Industry Cares Act Program loans and B&I loans guaranteed by the Agency prior to October 1, 2020. Amendments have been added to revise 7 CFR 4279.1, 4279.101, and 4287.101 accordingly.

Modification of the definition of non-regulated lending entity at § 5001.3, to remove language that does not apply nor further the meaning of the definition.

Addition of language at § 5001.102(d) to clarify that long-term financing to pay off a lender's interim construction loan after project completion will not be treated as debt refinancing in this section.

Addition of language at end of § 5001.102(d)(3) to clarify that (4) is included with § 5001.102(d)(1) to (3).

Correction of language at § 5001.115(n) and an addition of a new paragraph (s) that was inadvertently missed.

Removal of § 5001.118(b)(3) as this information was duplicative.

Modification to the list of regulated lending entities at § 5001.130(b) to include other lending entities not specified, but that meet the eligibility requirements. This language was inadvertently left out of the regulation during drafting.

Addition of paragraph § 5001.121(a)(4) to include refinancing as an eligible use of CF loan funds. The paragraph was inadvertently left out during the drafting of the regulation.

Addition of paragraph § 5001.121(c)(12) to include refinancing as an eligible use of WWD loan funds. The paragraph was inadvertently left out during the drafting of the regulation.

Addition of paragraph § 5001.121(c)(12) to include refinancing as an eligible use of B&I loan funds. The paragraph was inadvertently left out during the drafting of the regulation.

Removal of the last sentence in § 5001.202(b)(4)(ii). This sentence was inadvertently left in during the drafting of the regulation.

Removal of language at § 5001.205(e) referencing closure of a lender's construction loan as the reference should be to the guaranteed loan.

Additional items were added to the list of provisional content for a complete application at § 5001.303(c). These items are included in the program specific areas but were not included in this section.

Modifying language at § 5001.408 clarifying how a lender may obtain participation in the loan or assign all or part of the guaranteed portion of the guaranteed loan on the secondary market and that that any assignment by the lender of the guaranteed portion of the loan must be accomplished in accordance with the conditions in the lender's agreement and the assignment of the guaranteed or non-guaranteed portion of the loan applies to all individuals, not just the borrower as well as making changes to terminology.

Modifying language at § 5001.450(b)(1) to remove duplicative language.

Modifying language at § 5001.452(b) to improve readability.

Adding language at § 5001.453 to advise holders the Agency will provide a certificate of incumbency to verify the signature and title of the Agency official who signs the assignment guarantee agreement.

Removing § 5001.459(c) as it is no longer applicable.

Modifying language at § 5001.511 to improve readability.

Removing § 5001.515(c) as it is no longer applicable.

Removal of § 5001.524(d) which allowed the Agency to terminate the loan note guarantee for good cause. The Agency determined that this paragraph was duplicative of other language in the regulation.

The Agency, while drafting the regulation, inadvertently used sale and assign interchangeably when the correct term is assign. The Agency is taking the opportunity to correct this. Various spelling and grammar items were also corrected.

In FR Doc. 2020-13991, appearing on page 42494 in the Federal Register of Tuesday, July 14, 2020, the following corrections are made:

Please refer to Docket ID NRC-2017-0151 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-2017-0151.

• 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 PDR reference staff at 1-800-397-4209, at 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 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-2017-0151 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.

Because the NRC anticipates that this action will be non-controversial, the NRC is using the “direct final rule process” for this rule. The direct final rule will become effective on February 1, 2021. However, if the NRC receives significant adverse comments on this direct final rule by November 2, 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 Rule 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 staff to make a change (other than editorial) to the rule.

For detailed instructions on filing comments, please see the ADDRESSES section of this document.

The reactor vessel and its internal components support and align the fuel assemblies that make up the reactor core and provide a flow path to ensure adequate heat removal from the fuel assemblies. The reactor vessel also provides containment and a floodable volume to maintain core cooling in the event of an accident causing loss of the primary coolant. It is a cylindrical shell with a welded hemispherical bottom head and a removable hemispherical upper head. Some vessel shells were fabricated from curved plates that were joined by longitudinal and circumferential welds. Others were manufactured using forged rings and, therefore, only have circumferential welds that join the rings. These plate and forging materials are referred to as base metals. Maintenance of the structural integrity of the reactor vessel is essential in ensuring plant safety, because there is no redundant system to maintain core cooling in the event of a vessel failure.

One characteristic of reactor vessel steels is that their material properties change as a function of temperature and neutron irradiation. The primary material property of interest for the purposes of reactor vessel integrity is the fracture toughness of the reactor vessel material. Extensive experimental work determined that Charpy impact energy tests, which measure the amount of energy required to fail a small material specimen, can be correlated to changes in fracture toughness of a material. Thus, the Charpy impact specimens  1 from the beltline  2 materials ( i.e., base metal, weld metal, and heat-affected zone) became the standard to assess the change in fracture toughness in ferritic steels.

The fracture toughness of reactor vessel materials decreases with decreasing temperature and with increasing irradiation from the reactor. The decrease in fracture toughness due to neutron irradiation is referred to as “neutron embrittlement.” The fracture toughness of reactor vessel materials is determined by using fracture toughness curves in the American Society of Mechanical Engineers (ASME) Code, which are indexed to the reference temperature for nil-ductility transition (RT NDT ), as specified in ASME Boiler and Pressure Vessel Code, Section II, “Materials.” To account for the effects of neutron irradiation, the increase in RT NDT is equated to the increase in the 30 ft-lb index temperature from tests of Charpy-V notch impact specimens irradiated in capsules as a part of the surveillance program. The surveillance program includes Charpy impact specimens of the base and weld metals for the reactor vessel in each surveillance capsule. These surveillance capsules are exposed to the same operating conditions as the reactor vessel, and because the capsules are located closer to the reactor core than the reactor vessel inner diameter, the surveillance specimens are generally exposed to higher neutron irradiation levels than those experienced by the reactor vessel at any given time.

As a result of the surveillance capsule's location within the reactor vessel, the test specimens generally reflect changes in fracture toughness due to neutron embrittlement in advance of what the reactor vessel experiences and provide insight to the future condition of the reactor vessel. Therefore, the NRC instituted reactor vessel material surveillance programs as a requirement of appendix H, “Reactor Vessel Material Surveillance Program Requirements” (appendix H), to part 50 of title 10 of the Code of Federal Regulations (10 CFR), “Domestic Licensing of Production and Utilization Facilities,” so that the placement and testing of Charpy impact specimens in capsules between the inner diameter vessel wall and the core can provide data for assessing and projecting the change in fracture toughness of the reactor vessel.

The purpose for requiring a reactor vessel material surveillance program is to monitor changes in the fracture toughness properties in the beltline region of the reactor vessel and to use this information to analyze the reactor vessel integrity. Surveillance programs are designed not only to examine the current status of reactor vessel material properties but also to predict the changes in these properties resulting from the cumulative effects of neutron irradiation.

The determination as to whether a commercial nuclear power reactor vessel requires a material surveillance program under appendix H to 10 CFR part 50 is made at the time of plant licensing under 10 CFR part 50 or 10 CFR part 52, “Licenses, Certifications, and Approvals for Nuclear Power Plants.” If this surveillance program is required, it is designed and implemented at that time using the existing requirements. Certain aspects of the program, such as the specific materials to be monitored, the number of required surveillance capsules to be inserted in the reactor vessel, and the initial capsule withdrawal schedule were designed for the original licensed period of operation ( i.e., 40 years). The editions of the ASTM International (ASTM) E 185, which are incorporated by reference in appendix H to 10 CFR part 50, recommend three, four, or five surveillance capsules to be included in the design of reactor vessel material surveillance programs for the original licensed period of operation, based on the irradiation sensitivity of the material used to fabricate the reactor vessel. 3 Most plants have included several additional surveillance capsules beyond the number recommended by ASTM E 185. These capsules are referred to as “standby capsules.” The surveillance program for each reactor vessel provides assurance that the plant's operating limits ( e.g., the pressure-temperature limits) continue to meet the provisions in Appendix G of ASME Boiler and Pressure Vessel Code, Section XI, “Rules for Inservice Inspection of Nuclear Power Plant Components,” as required by appendix G, “Fracture Toughness Requirements,” to 10 CFR part 50. The program also provides assurance that the reactor vessel material upper shelf energy meets the requirements of appendix G to 10 CFR part 50. These assessments are used to ensure the integrity of the reactor vessel.

In addition to the Charpy impact specimens for determining the embrittlement in the reactor vessel, the surveillance capsules typically contain neutron dosimeters, thermal monitors, and tension specimens. 4 Surveillance capsules may also contain correlation monitor material, which is a material with composition, properties, and response to radiation that have been well characterized. The overall accuracy of neutron fluence measurements is dependent upon knowledge of the neutron spectrum. Therefore, a variety of neutron detector materials (dosimetry wires) are included in each surveillance capsule and used in the determination of neutron fluence for the vessel. The thermal monitors that are placed in the capsules ( e.g., low-melting-point elements or eutectic alloys) are used to identify the irradiated specimen's maximum exposure temperature.

Appendix H to 10 CFR part 50 requires light-water nuclear power reactor licensees to have a reactor vessel material surveillance program to monitor changes in the fracture toughness properties of the reactor vessel materials adjacent to the reactor core in the beltline region. Unless it can be shown that the end of design life neutron fluence is below certain criteria, the NRC requires licensees to implement a materials surveillance program that tests irradiated material specimens that are located in surveillance capsules in the reactor vessels. The program evaluates changes in material fracture toughness and thereby assesses the integrity of the reactor vessel. For each capsule withdrawal, the test procedures and reporting requirements must meet the requirements of ASTM E 185-82, “Standard Practice for Conducting Surveillance Tests for Light-Water Cooled Reactor Vessels,” to the extent practicable for the configuration of the specimens in the capsule.

The design of the surveillance program and the withdrawal schedule must meet the requirements of the edition of ASTM E 185 that is current on the issue date of the ASME Code to which the reactor vessel was purchased. Later editions of ASTM E 185, up to and including those editions through 1982, may be used. Appendix H to 10 CFR part 50 specifically incorporates by reference ASTM E 185-73, “Standard Recommended Practice for Surveillance Tests for Nuclear Reactor Vessels;” ASTM E 185-79, “Standard Practice for Conducting Surveillance Tests for Light-Water Cooled Nuclear Power Reactor Vessels,” and ASTM E 185-82. In sum, the surveillance program must comply with ASTM E 185, as modified by appendix H to 10 CFR part 50. The number, design, and location of these surveillance capsules within the reactor vessel are established during the design of the program, before initial plant operation.

Appendix H to 10 CFR part 50 also specifies that each capsule withdrawal and subsequent test results must be the subject of a summary technical report to be submitted to the NRC within one year of the date of capsule withdrawal, unless an extension is granted by the Director, Office of Nuclear Reactor Regulation. The NRC uses the results from the surveillance program to assess licensee submittals related to pressure-temperature limits under appendix G to 10 CFR part 50 and to assess pressurized water reactor licensee's compliance with either § 50.61, “Fracture toughness requirements for protection against pressurized thermal shock events,” or § 50.61a, “Alternate fracture toughness requirements for protection against pressurized thermal shock events.”

When appendix H to 10 CFR part 50 was established as a requirement (38 FR 19012; July 17, 1973), limited information and data were available on the subject of reactor vessel embrittlement. Thus, appendix H to 10 CFR part 50 required the inclusion of a comprehensive collection of specimen types representing the reactor vessel beltline materials in each surveillance capsule. Since 1973, a significant number of surveillance capsules have been withdrawn and tested. Analyses of these results support reconsidering the specimen types required for testing, and the required time for reporting the results from surveillance capsule testing. One outcome of this effort was that some specimen types were found to contribute to the characterization of reactor vessel embrittlement, while others did not. Therefore, the NRC determined that these latter types were unnecessary to meet the objectives of appendix H to 10 CFR part 50 and should no longer be required. Revising appendix H to 10 CFR part 50 to address this situation reduces the regulatory burden on licensees of data collection, with no effect on public health and safety.

In 1983, appendix H to 10 CFR part 50 was revised to require licensees to submit test results to the NRC within one year of the date of capsule withdrawal, unless an extension is granted by the Director, Office of Nuclear Reactor Regulation (48 FR 24008; May 27, 1983). As stated in the 1983 rulemaking, the reason for the requirement was the need for timely reporting of test results and notification of any problems. At that time, there was a limited amount of data from irradiated materials from which to estimate embrittlement trends of reactor vessels at nuclear power plants, making it important to receive timely reporting of test results.

Licensees that participate in an integrated surveillance program have found it challenging to meet this one-year requirement. This is related to the fact that an integrated surveillance program requires coordination among the multiple licensees participating in the program. 5 A significant number of test specimens have been analyzed since 1983, the results of which support a reduced need for prompt reporting of the test results. Based on this, the NRC has determined that the reporting requirement in appendix H to 10 CFR part 50 should be revised. Extending the reporting period allows for more time for licensee coordination and should help eliminate the need for licensees to prepare and submit extension requests and for the NRC to review such requests. This revision has no effect on public health and safety.

In January 2019, the Commission issued Staff Requirements Memorandum (SRM)-COMSECY-18-0016, “Request Commission Approval to Use the Direct Final Rule Process to Revise the Testing and Reporting Requirements in 10 CFR part 50, Appendix H, Reactor Vessel Material Surveillance Program Requirements (RIN 3150-AK07),” approving publication of the supporting regulatory basis and use of the direct final rule process. On April 3, 2019, the NRC issued the regulatory basis which provides an in-depth discussion on the technical merits of this rulemaking (84 FR 12876). 6 The regulatory basis includes additional information on the regulatory framework, types of reactor vessel material surveillance programs, regulatory topics that initiated this rulemaking effort, and options to address these topics. The regulatory basis shows that there is sufficient justification to proceed with rulemaking to amend appendix H to 10 CFR part 50 to reduce certain test specimens and extend the period to submit surveillance capsule reports to the NRC. In addition, in SRM-COMSECY-18-0016, the Commission directed the staff to clarify the requirements for the design of surveillance programs and the withdrawal schedules for reactor vessels purchased after 1982. These revisions will not establish any additional requirements for the current fleet of operating reactors.

The purpose of this action is to reduce the regulatory burden on reactor licensees and the NRC that is associated with test specimens contained within surveillance capsules and the reporting of surveillance test results, with no effect on public health and safety. This action also clarifies the requirements for the design of surveillance programs and the withdrawal schedules for reactor vessels purchased after 1982. The NRC has determined that the following revisions to appendix H to 10 CFR part 50 achieve the goal of reducing regulatory burden. These revisions do not establish any additional requirements for the current fleet of operating reactors.

The editions of ASTM E 185 incorporated by reference in appendix H to 10 CFR part 50 specify that the surveillance test specimens shall include base metal, weld metal, and heat-affected zone materials. Heat-affected zone specimens were first required in reactor vessel material surveillance programs in 1966 (ASTM E 185-66, “Recommended Practice for Surveillance Tests on Structural Materials in Nuclear Reactors”). Cracks in heat-affected zone material had been observed to cause the failure of components in non-nuclear applications, and from early research, these failures were in heat-affected zone materials with high hardness measurements, which is associated with low fracture toughness.

The heat-affected zone has been shown to exhibit superior fracture toughness compared to the base metal. In addition, test results from surveillance specimens have shown significant scatter of the heat-affected zone Charpy test data because of the inhomogeneous nature of the heat-affected zone material. This was the basis for eliminating the requirement for heat-affected zone specimens after the 1994 edition of ASTM E 185; thus, it is no longer prudent to require the inclusion or testing of heat-affected zone materials.

For these reasons, the NRC is revising appendix H to 10 CFR part 50 to make optional the requirement to include or test heat-affected zone specimens as part of the reactor vessel material surveillance program. For existing capsules that are currently in the reactor vessel, licenses can continue their practice to test the heat-affected zone specimens. For new and reconstituted capsules  7 that may be inserted into the reactor vessel in the future, licensees are no longer required to have heat-affected zone specimens in the capsules but could choose to continue this practice. This revision has no effect on public health and safety.

The editions of ASTM E 185 currently incorporated by reference in appendix H to 10 CFR part 50 specify the following with respect to tensile testing:

(1) For unirradiated material, tension specimens shall be tested for both the base and weld material at specified temperatures.

(2) For irradiated material, tension specimens shall be included for both the base and weld material and tested at specified temperatures.

(3) Tensile testing shall be conducted in accordance with ASTM Method E 8, “Methods of Tension Testing of Metallic Materials,” and ASTM E 21, “Recommended Practice for Elevated Temperature Tension Tests of Metallic Materials.”

The variation of tensile properties ( e.g., yield strength, tensile strength, and elongation) with test temperatures is established by testing tension specimens over a range of temperatures. Performing tensile tests before and after irradiation permits quantification of the hardening effect due to irradiation using the change in yield strength. Tensile data provide an indication of the radiation-induced strength property changes in the reactor vessel material and serve as a consistency check relative to Charpy data.

Past experience and test results have demonstrated that the differences in the test temperatures specified in ASTM E 185 can be small, which could yield small differences in tensile properties and redundant tensile information. Eliminating one test temperature and testing at room temperature and service temperature at all irradiation levels, allows for the comparison of the change in strength properties due to irradiation and temperature.

For these reasons, the NRC is revising appendix H to 10 CFR part 50 to require the inclusion or testing of only one tension specimen at room temperature and one tension specimen at service temperature, for all materials and irradiation levels as part of the reactor vessel material surveillance program. This reduces the number of tension specimens required in new and reconstituted surveillance capsules and for testing in existing surveillance capsules. For existing capsules that are currently in the reactor vessel, licensees can continue their practice of testing the tension specimens in accordance with ASTM E 185. For new and reconstituted capsules that may be inserted into the reactor vessel in the future, licensees could choose to continue this practice. This revision has no effect on public health and safety.

Correlation monitor material is a well characterized reactor vessel material that has been included in many surveillance capsules. Correlation monitor material is selected so that it has a comparable composition and processing history to the reactor vessel material. The purpose of a correlation monitor material in a surveillance capsule is to provide reference data for comparison to the established trends for the correlation monitor material.

The editions of ASTM E 185 currently incorporated by reference in appendix H to 10 CFR part 50 specify that it is optional to include correlation monitor material in surveillance capsules. These editions of ASTM E 185 do not explicitly indicate whether correlation monitor material shall be tested if it was optionally included in a surveillance capsule. Therefore, it is ambiguous whether correlation monitor material testing is required even though it is optional to include this material in surveillance capsules. In practice, the testing of correlation monitor material has demonstrated variability in the measured material properties of the correlation monitor material, which has limited the practical use of the data.

For these reasons, the NRC is revising appendix H to 10 CFR part 50 to clarify that testing of correlation monitor material is optional when included in existing, new, and reconstituted surveillance capsules. This revision has no effect on public health and safety.

ASTM E 185-82 specifies that the surveillance capsules shall include one set of temperature monitors (also known as “thermal monitors”) that are located within the capsule where the specimen temperature is predicted to be the maximum, and additional sets of temperature monitors may be placed at other locations to characterize the temperature profile. The standard specifies reporting of the temperature monitor results and an estimate of the maximum capsule exposure temperature.

Irradiation temperature is one of the parameters that is closely correlated with the effects of neutron embrittlement of reactor vessel steels, with lower embrittlement measured at higher irradiation temperatures within a range close to the standard operating temperature of 288 degrees Celsius (550 degrees Fahrenheit). Therefore, knowledge of the irradiation temperature history of surveillance capsules is important to ensure that the surveillance data are properly interpreted and do not portray a non-conservative estimate of the reactor vessel neutron embrittlement.

Temperature monitors are targeted to melt at specific temperatures, normally somewhat higher than the planned operating temperature, to identify the highest temperature seen by the surveillance capsule. The monitors provide an indication of whether the melt temperature was reached but they do not provide a time-based exposure history of the monitor.

Several factors can complicate the interpretation of the information from temperature monitors. The first complication arises when the surveillance capsule experiences a short duration thermal transient that increases the coolant inlet temperature. This could result in a positive indication from the temperature monitors, which is insignificant to the overall exposure conditions of the surveillance capsule. A second complication is caused by possible interpretation issues, where apparent melting of the temperature monitors is caused by long-term exposure of the monitor to temperatures near, but below, its melting point.

For these reasons, the NRC is revising appendix H to 10 CFR part 50 to make optional the requirement to include or evaluate temperature monitors as part of the reactor vessel material surveillance program. For existing capsules that are currently in the reactor vessel, licensees can continue their practice of evaluating the temperature monitors. For new and reconstituted capsules that may be inserted into the reactor vessel in the future, licensees are no longer required to include temperature monitors in the capsules but could choose to continue this practice. As an alternative to these temperature monitors, an estimate of the average capsule temperature during full power operation for each reactor fuel cycle will provide the irradiation temperature history of the surveillance capsule. This revision has no effect on public health and safety.

Appendix H to 10 CFR part 50 currently requires that within one year of the date of the surveillance capsule withdrawal, a summary technical report be submitted to the NRC that contains the data required by ASTM E 185, and the results of all fracture toughness tests conducted on the beltline materials in the irradiated and unirradiated conditions, unless an extension is granted by the Director, Office of Nuclear Reactor Regulation.

This one-year requirement in appendix H to 10 CFR part 50 became effective on July 26, 1983 (48 FR 24008), with the primary purpose of timely reporting of test results and notification of any problems determined from surveillance tests. This was important because there was a limited amount of available data from irradiated materials from which to estimate embrittlement trends. An extensive amount of embrittlement data has been collected and analyzed since this time, the results of which support the reduced need for prompt reporting of the test results.

Licensees participating in an integrated surveillance program have found it challenging to meet the one-year requirement to submit a report following each capsule withdrawal. In an integrated surveillance program, the representative materials chosen for a reactor are irradiated in one or more other reactors that have similar design and operating features. The data obtained from these test specimens may then be used in the analysis of other plants participating in the program. Implementation of the integrated surveillance program requires significant coordination among the multiple licensees participating in the program. Historically, these licensees have requested a 6-month extension to this reporting requirement and, to date, the Director of the NRC Office of Nuclear Reactor Regulation, has granted them. Furthermore, as surveillance capsules remain in the reactor vessel to support operation through 60 years and 80 years, longer periods of radioactive decay may be needed before the capsules can be shipped to testing facilities. Licensees may find it burdensome to meet the one-year reporting requirement under these circumstances.

For these reasons, the NRC is revising appendix H to 10 CFR part 50 to increase the time given to licensees to submit a summary technical report of each capsule withdrawal and the test results from 1 year to 18 months. This revision has no effect on public health and safety.

Appendix H to 10 CFR part 50 is also being revised to clarify the edition of ASTM E 185 that is required for a reactor vessel purchased after 1982. Currently, there is the potential to misinterpret the regulation as requiring the use of an edition of ASTM E 185 that is not incorporated by reference in appendix H to 10 CFR part 50. Therefore, the NRC is revising appendix H to 10 CFR part 50 to clarify that for reactor vessels purchased after 1982, the design of the surveillance program and the withdrawal schedule must meet the requirements of ASTM E 185-82 ( i.e., the latest edition of ASTM E 185 that is incorporated by reference in appendix H to 10 CFR part 50).

Surveillance programs that include the withdrawal schedule required by appendix H to 10 CFR part 50 were originally established and designed for the initial 40-year operating license of a nuclear power plant. The objective of this program during extended plant operations  8 remains the same as it was during the initial 40-year operating license, which is to continue monitoring changes in fracture toughness of the reactor vessel materials to ensure the integrity of the reactor vessel. This direct final rule does not revise appendix H to 10 CFR part 50 with respect to surveillance capsule withdrawal schedules during extended plant operation.

New light-water nuclear power reactor designs are substantially similar to operating reactors with regard to the relevant considerations for establishing adequate surveillance programs under appendix H to 10 CFR part 50. These similarities include proposed materials, fabrication methods, and operating environments. The proposed withdrawal schedules from ASTM E 185 are constructed to provide early evidence of material behavior which is of particular interest for a new or novel design with little or no operating experience. Consequently, the NRC is not revising appendix H to 10 CFR part 50 to address new light-water nuclear power reactor designs separately from existing reactors.

The following paragraphs describe the specific changes being made by this direct final rule.

This direct final rule revises paragraph III.B.1 to clarify the design of surveillance programs and the capsule withdrawal schedules for reactor vessels purchased after 1982 and to include information regarding the use of optional provisions. This direct final rule also adds new paragraph III.B.4 that makes optional certain aspects of ASTM E 185.

This direct final rule revises the timeframe for the submission of a summary technical report from 1 year to 18 months.

Under the Regulatory Flexibility Act (5 U.S.C. 605(b)), the NRC certifies that this direct final rule does not have a significant economic impact on a substantial number of small entities. This direct final rule affects only the licensing and operation of nuclear power plants. The companies that own these plants 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).

The NRC has prepared a regulatory analysis for this direct final rule. The analysis examines the costs and benefits of the alternatives considered by the NRC. Based on the analysis, the NRC concludes that this action is cost beneficial and reduces the regulatory costs for reactor licensees and the NRC for an issue that is not significant to safety. This issue is not significant to safety because this direct final rule reduces the testing of some specimens and eliminates the testing of other specimens that were found not to provide meaningful information to assess the integrity of the reactor vessel. Also, extending by 6 months the period for submitting the report of test results to the NRC is not significant to safety. This is because the increase in neutron fluence over 6 months is very small, and therefore the projected increase in embrittlement for the 6-month period would also be very small. This small impact, in conjunction with the margin of safety that is inherent in the pressure-temperature limit curves, minimizes any impact due to the 6-month increase.

The NRC's backfitting provisions for holders of construction permits, and applicants and holders of operating licenses and combined licenses, appear in § 50.109, “Backfitting” (the Backfit Rule). Issue finality provisions, which are analogous to the backfitting provisions in § 50.109, appear in § 52.63, “Finality of Standard Design Certifications;” § 52.83, “Finality of Referenced NRC Approvals; Partial Initial Decision on Site Suitability;” § 52.98, “Finality of Combined Licenses; Information Requests;” § 52.145, “Finality of Standard Design Approvals, Information Request;” and § 52.171, “Finality of Manufacturing Licenses; Information Requests.”

This direct final rule: (1) Provides licensees with a nonmandatory relaxation from the current 1 year following a capsule withdrawal to 18 months to submit surveillance capsule test results, and (2) reduces testing requirements by amending the NRC's regulations in appendix H to 10 CFR part 50. Because these changes are nonmandatory, licensees have the option to comply with the revised requirements for testing certain surveillance capsule specimens or for extending the allowable period for submitting surveillance test results to the NRC ( i.e., licensees can continue to submit surveillance capsule test results within one year of the date of capsule withdrawal). Therefore, this direct final rule does not constitute backfitting or raise issue finality concerns.

Cumulative effects of regulation (CER) consists of the challenges licensees may face in addressing the implementation of new regulatory positions, programs, and requirements ( e.g., rulemaking, guidance, generic letters, backfits, inspections). The CER may manifest in several ways, including the total burden imposed on licensees by the NRC from simultaneous or consecutive regulatory actions that can adversely affect the licensee's capability to implement those requirements, while continuing to operate or construct its facility in a safe and secure manner.

The goals of the NRC's CER effort were met throughout the development of this action. The NRC has engaged external stakeholders at public meetings held during the development of the regulatory basis and this direct final rule. A public meeting was held on June 1, 2017, to provide an opportunity for the exchange of information on the scope and related costs and benefits associated with this action. Feedback obtained at this meeting was used in developing the regulatory basis and regulatory analysis. A second public meeting was held on April 30, 2019, to provide information on the status and scope of this direct final rule, and to discuss implementation and CER. Summaries of both public meetings are available in ADAMS, as provided in the “Availability of Documents” section of this document.

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).

The Commission has determined under the National Environmental Policy Act of 1969, as amended, and the Commission's regulations in 10 CFR part 51, subpart A, that the direct final rule will not have a significant effect on the quality of the human environment and, therefore, an environmental impact statement is not required. The principal effect of this direct final rule is to amend the reactor vessel materials surveillance program requirements for commercial light-water power reactors. Specifically, it amends the requirements associated with the testing of specimens contained within surveillance capsules and reporting the surveillance test results.

The amendments to appendix H to 10 CFR part 50 that revise the surveillance requirements for testing specimens add optional provisions that would need to be adopted by individual licensees. In order to adopt these optional provisions, licensees would need to either submit a license amendment or determine whether the optional provisions can be implemented under 10 CFR 50.59, “Changes, tests and experiments.” When the 10 CFR 50.59 regulation was promulgated in 1999, the Commission concluded that there would be no significant impact on the environment for the types of changes to a nuclear power plant's licensing basis that a licensee could make under this provision without NRC review. If a license amendment is required to be submitted, the environmental impacts of that future license amendment would be evaluated by the NRC staff as part of the review of the license amendment request. The amendments to appendix H to 10 CFR part 50 that revise the recordkeeping and reporting requirements are categorically excluded under 10 CFR 51.22(c)(3)(ii) and (iii). The NRC has also determined that this action would involve no significant change in the types or amounts of any effluents that may be released offsite; no significant increase in individual or cumulative occupational radiation exposure; and no significant increase in the potential for or consequences from radiological accidents. In addition, the NRC has determined that there are no significant impacts to biota, water resources, historic properties, cultural resources, or socioeconomic conditions in the region. As such, there are no extraordinary circumstances that would preclude reliance on this categorical exemption. Therefore, pursuant to 10 CFR 51.22(b), no environmental impact statement or environmental assessment need be prepared in connection with revising the reporting requirement under appendix H to 10 CFR part 50.

The burden to the public for the information collection is estimated to be reduced by 78 hours per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the information collection. Further information about information collection requirements associated with this direct final rule can be found in the companion proposed rule published elsewhere in this issue of the Federal Register .

This direct final rule is being issued prior to approval by the Office of Management and Budget (OMB) of these information collection requirements, which were submitted under OMB control number 3150-0011. When OMB notifies us of its decision, we will publish a document in the Federal Register providing notice of the effective date of the information collections or, if approval is denied, providing notice of what action we plan to take.

Send comments on any aspect of these information collections, including suggestions for reducing the burden, to the Information Services Branch (T6-A10M), U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, or by email to INFOCOLLECTS.RESOURCE@NRC.GOV; and to OMB Office of Information and Regulatory Affairs (3150-0011), Attn: Desk Officer for the Nuclear Regulatory Commission, 725 17th Street NW, Washington, DC 20503; email: oira_submission@omb.eop.gov.

The NRC may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the document requesting or requiring the collection displays a currently valid OMB control number.

This direct final rule is a rule as defined in the Congressional Review Act (5 U.S.C. 801-808). However, the Office of Management and Budget has not found it to be a major rule as defined in the Congressional Review Act.

Under the “Policy Statement on Adequacy and Compatibility of Agreement State Programs,” approved by the Commission on June 20, 1997, and published in the Federal Register (62 FR 46517; September 3, 1997), this rule is classified as compatibility “NRC.” Compatibility is not required for Category “NRC” regulations. 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, and although an Agreement State may not adopt program elements reserved to the NRC, it may wish to inform its licensees of certain requirements via a mechanism that is consistent with a particular State's administrative procedure laws, but does not confer regulatory authority on the State.

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 using such a standard is inconsistent with applicable law or otherwise impractical. In this direct final rule, the NRC is amending the reactor vessel materials surveillance program requirements to reduce the regulatory burden for an issue that is not significant to safety associated with the testing of surveillance capsule specimens and reporting the surveillance test results. It also clarifies the requirements for the design of surveillance programs and the withdrawal schedules for reactor vessels purchased after 1982. Specifically, this direct final rule allows licensees to reduce the testing of some specimens and eliminates the testing of other specimens that were found not to provide meaningful information to assess the integrity of the reactor vessel. It also extends by 6 months the period for licensees to submit the report of test results to the NRC. The increase in neutron fluence over 6 months is very small, and therefore the projected increase in embrittlement over this period would also be very small. This small impact, in conjunction with the margin of safety which is inherent in the pressure-temperature limit curves, minimizes any impact due to the 6-month increase. This action does not constitute the establishment of new conditions on the ASTM standards that are currently incorporated by reference in appendix H to 10 CFR part 50 nor a standard that contains generally applicable requirements. This action maintains the use of the ASTM standards that are currently incorporated by reference in appendix H to 10 CFR part 50 but makes optional certain aspects of the ASTM standards that have been determined not to be necessary for the safe operation of nuclear power plants.

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

For the reasons set forth in the preamble, and under the authority of the Atomic Energy Act of 1954, as amended; the Energy Reorganization Act of 1974, as amended; and 5 U.S.C. 552 and 553, the NRC is adopting the following amendments to 10 CFR part 50:

The Board periodically issues a technical amendments rule correcting minor typographical errors, inaccurate legal citations, or superfluous or outdated regulatory provisions throughout the NCUA's regulations. Because these changes are technical in nature, and do not affect federally insured credit unions in a substantive manner, the Board issues these technical amendments rules as final rules without notice and comment typically required by the Administrative Procedure Act (APA). 1 Accordingly, the Board is issuing this final rule to address those matters.

The Board has the legal authority to issue this final rule pursuant to its plenary rulemaking authority under the Federal Credit Union Act (FCU Act)  2 and its specific rulemaking authority under the various acts the Board administers.

The final rule makes general wording, style, and cross-reference changes throughout the NCUA's regulations. For example, the final rule corrects various typographical errors. Technical amendments of this nature will apply throughout the NCUA's regulations. Therefore, the preamble does not address these types of stylistic changes in the section-by-section analysis below.

The final rule amends one of the definitions listed in § 700.2 of the NCUA's regulations that was erroneously changed. The definitions in part 700 apply throughout chapter VII of title 12 of the Code of Federal Regulations “unless the context indicates otherwise.”  3 A “Noninsured credit union” is currently defined by regulation as “a credit union chartered under the laws of any State, the District of Columbia, the several territories and possessions of the United States, the Panama Canal Zone, or the Commonwealth of Puerto Rico, whose member accounts are not insured by NCUA.” This term mirrors the Federal Credit Union Act definition. 4 A final technical amendments rule issued in 2018 amended several references to “Non-federally insured credit unions” changing them to “Noninsured credit unions.” Although this change conformed the regulatory definition to the statutory definition, it also inadvertently created internal inconsistencies in the regulations and created unintended confusion and consequences. The Board has determined that the erroneous technical amendment issued in 2018 needs to be reversed to correct the inadvertent regulatory inconsistencies. This will restore clarity that the term “Non-federally insured credit unions,” consistent with the Federal Credit Union Act, includes credit unions whose member accounts are insured by agencies or entities other than the NCUA, such as state or private share insurers, as well as credit unions whose member accounts are not insured by any party. Accordingly, the final rule makes this change in § 700.2 and in other parts where the term “Noninsured credit union” currently appears—parts 704, 705, 708b, and 740.

Section 701.34(a)(6) provides the definition of “median family income” and “total median earnings for individuals” by referring to data from the Census Bureau. The current definition points to the Census Bureau's American FactFinder site with a specific hyperlink. The Census Bureau no longer houses this data at that specific site. Accordingly, this final rule replaces the “FactFinder” reference with “American Community Survey” and provides a more general link to the Census Bureau's website. This change is not intended to alter the reliance on Census Bureau data for these statistics.

The final rule amends certain provisions to update the NCUA office responsible for a certain activity. For instance, the Office of Credit Union Resources and Expansion (CURE) has replaced the Regional Office as the responsible office at Chapter 1, Section III. The final rule also updates references to the Regional Offices to reflect the agency's realignment that was finalized in 2019, as well as an update to the name of one of the credit union trade associations noted in the Chartering Manual.

In addition to typographical corrections, the final rule includes corrections to the amendatory instructions from the 2015 final rule on risk-based capital  5 to ensure that cross-references to other provisions that the Board has since been amended will be correctly reflected in this part when the 2015 final rule goes into effect, as it is scheduled to do on January 1, 2022. 6 These corrections do not make any substantive change to the 2015 final rule.

Throughout part 704, corporate credit unions are frequently referred to as “corporates.” The final rule amends several sections in this part to replace “corporate” or “corporates” with “corporate credit union” or “corporate credit unions” to avoid confusion and to be more precise.

In addition, a reference to “notational principal balance” has been corrected to “notional principal balance.”

This final rule makes a notable change relating to the model clauses and forms in appendix B to this part, which addresses Truth in Savings. Specifically, appendix B refers several times to a chart of accounts in a specific section of the NCUA's Accounting Manual for Federal Credit Unions. This publication no longer contains this chart of accounts, but this chart served as the model for the sample forms. Accordingly, the final rule adds a statement to this effect in the prefatory language to this appendix to avoid confusion for those referring to the current version of the Accounting Manual.

In addition, the final rule redesignates several paragraphs in appendix C to this part to correct duplicate paragraph numbering that resulted from prior amendments. This change does not affect or add to the substance of these provisions. The final rule will also correct minor wording or typographical errors.

Section 708a.304 addresses the notice that a credit union must file with the NCUA within 30 days of its board adopting a proposal to merge. This provision refers to an asset threshold set by the Federal Trade Commission (FTC) under the Hart-Scott Rodino Act that triggers a premerger notification to the FTC. The threshold amount listed in the current regulation is outdated. Because the FTC will continue to update this threshold, removing the specific dollar amount from this regulation will help to avoid confusion or alternatively, the need for the NCUA to update its regulation each time the FTC updates the threshold. Credit unions should refer to the FTC's announcements of the threshold amounts on that agency's website and in the Federal Register .

The final rule makes two notable clarifications and updates to this part. In § 747.0, which sets forth the scope of this part, the final rule adds a defined term for the Uniform Rules when that subject is first discussed in order to provide clarity. In § 747.207, which addresses notices of termination of insured status, the final rule updates a reference to the standard maximum share insurance amount from $100,000 to $250,000 to reflect the statutory change that Congress enacted in 2010. 7

Generally, the APA requires a Federal agency to provide the public with notice and an opportunity to comment on agency rulemakings. 8 The APA, however, creates an exception in cases where an agency for good cause determines “that notice and public procedure thereon are impracticable, unnecessary, or contrary to the public interest.”  9 Because all of the changes in this final rule involve only minor, technical amendments to the NCUA's existing regulations, the Board has determined that notice and comment would be unnecessary and contrary to the public interest.

Furthermore, the APA generally provides that a final rule may not become effective until at least 30 days after its publication in the Federal Register unless the agency determines that good cause exists to dispense with this requirement. 10 As noted above, given that the rule does not impose new requirements on federally insured credit unions and only involves minor, technical amendments to existing regulations, the Board finds sufficient good cause exists to dispense with the 30-day effective date requirement. The rule will, therefore, be effective immediately upon publication.

The Regulatory Flexibility Act requires the NCUA to prepare an analysis of any significant economic impact a regulation may have on a substantial number of small entities (primarily those under $100 million in assets). 11 As discussed previously, consistent with the APA, 12 the Board has determined for good cause that general notice and opportunity for public comment is unnecessary, and therefore the Board is not issuing a notice of proposed rulemaking. Rules that are exempt from notice and comment procedures 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. Accordingly, the Board has concluded that the RFA's requirements relating to initial and final regulatory flexibility analysis do not apply.

The Paperwork Reduction Act of 1995 (PRA) applies to rulemakings in which an agency by rule creates a new paperwork burden on regulated entities or increases an existing burden. 13 For purposes of the PRA, a paperwork burden may take the form of a reporting or recordkeeping requirement, both referred to as information collections. As the final rule makes only minor, technical amendments to the NCUA's existing regulations, the NCUA has determined it does not increase paperwork requirements under the PRA.

The Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA) provides generally for congressional review of agency rules. 14 A reporting requirement is triggered in instances where the NCUA issues a “final rule” as defined by statute. 15 As required by SBREFA, the NCUA will submit this rule to the Office of Management and Budget for it to determine if the final rule is a “major rule” for purposes of SBREFA. The NCUA does not believe the rule is major.

The NCUA has determined that this rule will not affect family well-being within the meaning of section 654 of the Treasury and General Government Appropriations Act. 16

Executive Order 13132 encourages independent regulatory agencies to consider the impact of their actions on state and local interests. 17 The NCUA, an independent regulatory agency as defined in 44 U.S.C. 3502(5), voluntarily complies with the executive order to adhere to fundamental federalism principles. The final rule does not have substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government. The NCUA has therefore determined that this final rule does not constitute a policy that has federalism implications for purposes of the Executive order.

In FR Doc. 2015-26790, appearing on page 66626 in the Federal Register of Thursday, October 29, 2015, the following corrections are made:

For the reasons discussed above, the Board is correcting FR Doc. 2015-26790, as set forth above, and amending 12 CFR parts 700, 701, 702, 704, 705, 707, 708a, 708b, 709, 717, 725, 740, 741, 747, 748, and 750 as follows:

On September 24, 2020, the Department published the “Identification of Prohibited Transactions to Implement Executive Order 13942 and Address the Threat Posed by TikTok and the National Emergency with Respect to the Information and Communications Technology and Services Supply Chain” (the “Identification”) in the Federal Register at 85 FR 60061. The Identification provided that the following transactions would be prohibited:

1. Any provision of services to distribute or maintain the TikTok mobile application, constituent code, or application updates through an online mobile application store, or any online marketplace where mobile users within the land or maritime borders of the United States and its territories may download or update applications for use on their mobile devices;

2. Any provision of internet hosting services enabling the functioning or optimization of the TikTok mobile application within the land and maritime borders of the United States and its territories;

3. Any provision of content delivery network services enabling the functioning or optimization of the TikTok mobile application within the land and maritime borders of the United States and its territories;

4. Any provision of directly contracted or arranged internet transit or peering services enabling the functioning or optimization of the TikTok mobile application within the land and maritime borders of the United States and its territories;

5. Any utilization of the TikTok mobile application's constituent code, functions, or services in the functioning of software or services developed and/or accessible within the land and maritime borders of the United States and its territories; or

6. Any other transaction by any person, or with respect to any property, subject to the jurisdiction of the United States, with ByteDance Ltd., or its subsidiaries, including TikTok Inc., in which any such company has any interest, as may be identified at a future date under the authority delegated under Executive Order 13942.

Transactions identified in paragraph 1 above were to be prohibited at 11:59 p.m. eastern standard time on September 27, 2020; transactions identified in paragraphs 2, 3, 4, and 5 above were to be prohibited at 11:59 p.m. eastern standard time on November 12, 2020.

On September 18, 2020, TikTok Inc. filed a lawsuit in the United States District Court for the District of Columbia ( TikTok Inc. et al. v. Trump et al., No. 20-cv-02658), seeking various relief, including a court order to prohibit the Department from implementing or enforcing Executive Order 13942 or the identified prohibited transactions. Plaintiffs subsequently filed a motion for a preliminary injunction to pursue such relief.

On September 27, 2020, the District Court issued an Order granting in part and denying in part the Plaintiffs' motion for a preliminary injunction. This Order enjoined the Department from implementing the prohibition on transactions identified in Paragraph 1 above.

The Department is complying with the terms of this order. Accordingly, this serves as NOTICE that the Secretary's prohibition of identified transactions (limited to the transactions identified in Paragraph 1 above) pursuant to Executive Order 13942, related to TikTok, HAS BEEN ENJOINED, and WILL NOT GO INTO EFFECT, pending further legal developments.

Any further guidance and updates regarding the subject litigation will be posted on the Department website ( www.commerce.gov ) on an ongoing basis.

The United States is a party to the 1961 United Nations Single Convention on Narcotic Drugs (“Single Convention”), March 30, 1961, 18 U.S.T. 1407, 570 U.N.T.S. 151, as amended. Article 3, paragraph 7 of the Single Convention requires that if the Commission on Narcotic Drugs (“Commission”) adds a substance to one of the schedules of such Convention, and the United States receives notification of such scheduling decision from the Secretary-General of the United Nations (“Secretary-General”), the United States, as a signatory Member State, is obligated to control the substance under its national drug control legislation. Under 21 U.S.C. 811(d)(1) of the Controlled Substances Act (CSA), if control of a substance is required “by United States' obligations under international treaties, conventions, or protocols in effect on October 27, 1970,” the Attorney General must issue an order permanently controlling such drug under the schedule he deems most appropriate to carry out such obligations, without regard to the findings required by 21 U.S.C. 811(a) or 812(b), and without regard to the procedures prescribed by 21 U.S.C. 811(a) and (b). The Attorney General has delegated scheduling authority under 21 U.S.C. 811 to the Administrator of the Drug Enforcement Administration (Administrator of DEA or Administrator). 28 CFR 0.100.

On February 6, 2018, DEA issued a temporary scheduling order, placing fentanyl-related substances, as defined in the order, in schedule I of the CSA. 83 FR 5188. That order was based on findings by the former Acting Administrator that the temporary scheduling of this class of substances was necessary to avoid an imminent hazard to the public safety; the order was codified at 21 CFR 1308.11(h)(30). On April 19, 2019, in the Federal Register , DEA provided the chemical name for crotonyl fentanyl, along with four other substances, identifying how these individual substances met the definition for fentanyl-related substances, 1 and, as such, were already covered by the February 2018 temporary order. 84 FR 16397. Regarding crotonyl fentanyl specifically, this substance was not otherwise controlled in any schedule ( i.e., listed under another Administration Substance Controlled Number) and is structurally related to fentanyl by the replacement of the N -propionyl group by another acyl group ( i.e., meets definition for modification E). On February 6, 2020, Congress extended the temporary control of fentanyl-related substances, as set forth in 21 CFR 1308.11(h)(30), until May 6, 2021. Public Law 116-114, sec. 2, 134 Stat. 103 (2020).

In November 2019, the Director-General of the World Health Organization recommended to the Secretary-General that crotonyl fentanyl and valeryl fentanyl be placed in Schedule I of the Single Convention, as these two substances have opioid mechanisms of action and similarity to drugs that are controlled in Schedule I of the Single Convention ( i.e., crotonyl fentanyl is similar to drugs such as oxycodone and fentanyl; valeryl fentanyl is similar to drugs such as fentanyl), and have dependence and abuse potential. On May 7, 2020, the Secretary-General advised the Secretary of State of the United States, by letter, that during its 63rd session in March 2020, the Commission voted to place crotonyl fentanyl and valeryl fentanyl in Schedule I of the Single Convention (CND Mar/63/2 and Mar/63/3). Valeryl fentanyl is temporarily controlled in schedule I of the CSA until February 1, 2021 (85 FR 5321, Jan. 30, 2020), and it will not be discussed in this final order. 2

As discussed in the background section, crotonyl fentanyl is temporarily controlled in schedule I of the CSA, as it meets the definition of fentanyl-related substances, pursuant to 21 CFR 1308.11(h)(30). Accordingly, crotonyl fentanyl is scheduled as part of a class of substances.

Crotonyl fentanyl has a pharmacological profile similar to morphine, fentanyl, and other synthetic opioids that act as µ-opioid receptor agonists. For this reason, crotonyl fentanyl is abused for its opioid-like effects.

Law enforcement reports in the United States demonstrate the illicit use and distribution of this substance, which are similar to that of heroin and prescription opioid analgesics. The National Forensic Laboratory Information System (NFLIS) is a national drug forensic laboratory reporting system that systematically collects results from drug chemistry analyses conducted by other federal, state, and local forensic laboratories across the country. According to NFLIS, 3 there have been 143 reports containing crotonyl fentanyl since it was first reported in June 2017.

DEA is not aware of any claims or any medical or scientific literature suggesting that crotonyl fentanyl has a currently accepted medical use in treatment in the United States. In addition, the Department of Health and Human Services (HHS) advised DEA, by letter dated November 29, 2017, that there were no investigational new drug applications or approved new drug applications for fentanyl-related substances, a class that, as noted, includes crotonyl fentanyl.

DEA requested that HHS conduct a scientific and medical evaluation and a scheduling recommendation for several fentanyl-related substances, including crotonyl fentanyl, by letter dated April 3, 2019. In response to this request, HHS provided DEA a recommendation, dated July 2, 2020, to place crotonyl fentanyl in schedule I of the CSA. The recommendation from HHS is consistent with the placement of crotonyl fentanyl in Schedule I of the Single Convention in March 2020.

Normally, 21 U.S.C. 811(b) would require DEA to secure such an HHS recommendation as part of the regular scheduling process. As discussed above, however, DEA has authority under 21 U.S.C. 811(d)(1) to control substances that have been added to the Single Convention without making any findings otherwise required by 21 U.S.C. 811(a) or 812(b), and without following the procedures prescribed by 21 U.S.C. 811(a) and (b)—including 811(b)'s requirement that DEA secure an evaluation and recommendation from HHS. Thus, HHS's recommendation supports scheduling crotonyl fentanyl, but its scheduling does not depend on that recommendation.

Therefore, consistent with 21 U.S.C. 811(d)(1), DEA concludes that crotonyl fentanyl has no currently accepted medical use in treatment in the United States  4 and is most appropriately placed in schedule I of the CSA, the same schedule in which it currently resides. Because control is required under the Single Convention, DEA will not be initiating regular rulemaking proceedings to schedule crotonyl fentanyl pursuant to 21 U.S.C. 811(a).

This action establishes a specific listing for crotonyl fentanyl in schedule I of the CSA within 21 CFR 1308.11(b) (the opiates category of schedule I), and assigns an Administration Controlled Substances Number for the substance: As discussed above, crotonyl fentanyl was not previously listed in schedule I individually, but was instead temporarily controlled as part of the class of fentanyl-related substances controlled under 21 CFR 1308.11(h)(30). This action will allow DEA to establish an aggregate production quota for crotonyl fentanyl and grant individual manufacturing and procurement quotas to DEA-registered manufacturers of crotonyl fentanyl who had previously been granted individual quotas for such purposes under the drug code for fentanyl-related substances.

In order to meet the United States' obligations under the Single Convention and because crotonyl fentanyl has no currently accepted medical use in treatment in the United States, the Acting Administrator has determined that crotonyl fentanyl, including its isomers, esters, ethers, salts, and salts of isomers, esters, and ethers, whenever the existence of such isomers, esters, ethers, and salts is possible, should remain in schedule I of the CSA.

Crotonyl fentanyl has been controlled as a schedule I controlled substance since February 6, 2018. With publication of the final order contained in this document, crotonyl fentanyl remains subject to the CSA's schedule I regulatory controls and administrative, civil, and criminal sanctions applicable to the manufacture of, distribution of, importation of, exportation of, engagement in research or conduct of instructional activities with, and possession of, schedule I controlled substances, including the following:

1. Registration. Any person who handles (manufactures, distributes, imports, exports, engages in research or conducts instructional activities with, or possesses), or who desires to handle, crotonyl fentanyl must be registered with DEA to conduct such activities pursuant to 21 U.S.C. 822, 823, 957, and 958, and in accordance with 21 CFR parts 1301 and 1312.

2. Disposal of stocks. Crotonyl fentanyl must be disposed of in accordance with 21 CFR part 1317, in addition to all other applicable federal, state, local, and tribal laws.

3. Security. Crotonyl fentanyl is subject to schedule I security requirements and must be handled and stored pursuant to 21 U.S.C. 821, 823, 871(b), and in accordance with 21 CFR 1301.71 through 1301.93. Non-practitioners handling crotonyl fentanyl must also comply with the employee screening requirements of 21 CFR 1301.90 through 1301.93.

4. Labeling and packaging. All labels, labeling, and packaging for commercial containers of crotonyl fentanyl must be in compliance with 21 U.S.C. 825 and 958(e), and must be in accordance with 21 CFR part 1302.

5. Quota. Only registered manufacturers are permitted to manufacture crotonyl fentanyl in accordance with a quota assigned pursuant to 21 U.S.C. 826 and in accordance with 21 CFR part 1303.

6. Inventory. Every DEA registrant who possesses any quantity of crotonyl fentanyl has been required to keep an inventory of all stocks of this substance on hand as of February 6, 2018, pursuant to 21 U.S.C. 827 and 958(e), and in accordance with 21 CFR 1304.03, 1304.04, and 1304.11.

7. Records and Reports. DEA registrants must maintain records and submit reports with respect to crotonyl fentanyl pursuant to 21 U.S.C. 827 and 958(e), and in accordance with 21 CFR parts 1304, 1312, and 1317.

8. Order Forms. All DEA registrants who distribute crotonyl fentanyl must continue to comply with order form requirements pursuant to 21 U.S.C. 828 and in accordance with 21 CFR part 1305.

9. Importation and Exportation. All importation and exportation of crotonyl fentanyl must continue to be in compliance with 21 U.S.C. 952, 953, 957, and 958, and in accordance with 21 CFR part 1312.

10. Liability. Any activity involving crotonyl fentanyl not authorized by, or in violation of the CSA, is unlawful, and may subject the person to administrative, civil, and/or criminal sanctions.

Executive Orders 12866, 13563, and 13771, Regulatory Planning and Review, Improving Regulation and Regulatory Review, and Reducing Regulation and Controlling Regulatory Costs

This action is not a significant regulatory action as defined by Executive Order (E.O.) 12866 (Regulatory Planning and Review), section 3(f), and the principles reaffirmed in E.O. 13563 (Improving Regulation and Regulatory Review); and, accordingly, this action has not been reviewed by the Office of Management and Budget (OMB). This order is not an E.O. 13771 regulatory action because this rule is not significant under E.O. 12866.

This action meets the applicable standards set forth in sections 3(a) and 3(b)(2) of E.O. 12988 to eliminate drafting errors and ambiguity, minimize litigation, provide a clear legal standard for affected conduct, and promote simplification and burden reduction.

This action does not have federalism implications warranting the application of E.O. 13132. This action does not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

This action does not have tribal implications warranting the application of E.O. 13175. The action does not have substantial direct effects 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 CSA provides for an expedited scheduling action where control is required by the United States obligations under international treaties, conventions, or protocols. 21 U.S.C. 811(d)(1). If control is required pursuant to such international treaty, convention, or protocol, the Attorney General, as delegated to the Administrator, must issue an order controlling such drug under the schedule he deems most appropriate to carry out such obligations, without regard to the findings or procedures otherwise required for scheduling actions. Id.

In accordance with 21 U.S.C. 811(d)(1), scheduling actions for drugs that are required to be controlled by the United States' obligations under international treaties, conventions, or protocols in effect on October 27, 1970, shall be issued by order (as compared to scheduling by rule pursuant to 21 U.S.C. 811(a)). Therefore, DEA believes that the notice and comment requirements of section 553 of the Administrative Procedure Act (APA), 5 U.S.C. 553, do not apply to this scheduling action. In the alternative, even if this action does constitute “rule making” under 5 U.S.C. 551(5), this action is exempt from the notice and comment requirements of 5 U.S.C. 553 pursuant to 5 U.S.C. 553(a)(1) as an action involving a foreign affairs function of the United States because it is being done pursuant to 21 U.S.C. 811(d)(1), which requires that the United States comply with its obligations under the specified international agreements.

The Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612) applies to rules that are subject to notice and comment under section 553(b) of the APA or any other law. As explained above, the CSA exempts this final order from notice and comment. Consequently, the RFA does not apply to this action.

This action does not impose a new collection of information requirement under the Paperwork Reduction Act of 1995. 44 U.S.C. 3501-3521. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number.

This action is not a major rule as defined by the Congressional Review Act (CRA), 5 U.S.C. 804. This order will not result in: “an annual effect on the economy of $100,000,000 or more; a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions; or significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based enterprises to compete with foreign-based enterprises in domestic and export markets.” However, pursuant to the CRA, DEA has submitted a copy of this final order to both Houses of Congress and to the Comptroller General.

For the reasons set out above, DEA amends 21 CFR part 1308 as follows:

This action relates to marine diesel engines with rated power between 600 and 1,400 kW intended for installation on vessels flagged or registered in the United States, vessels that use those engines, and companies that manufacture, repair, or rebuild those engines and vessels.

Categories and business entities that might be affected by this rule include the following:

This table is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely covered by these rules. This table lists the types of entities that we are aware may be regulated by this action. Other types of entities not listed in the table could also be regulated. To determine whether your activities are regulated by this action, you should carefully examine the applicability criteria in the referenced regulations. You may direct questions regarding the applicability of this action to the persons listed in the preceding FOR FURTHER INFORMATION CONTACT section.

EPA's 2008 Final Rule for Control of Emissions of Air Pollution from Locomotive Engines and Marine Compression-Ignition Engines Less than 30 Liters per Cylinder adopted Tier 4 emission standards for commercial marine diesel engines at or above 600 kilowatts (kW) (73 FR 37096, June 30, 2008). These standards, which were expected to require the use of exhaust aftertreatment technology, phased in from 2014 to 2017, depending on engine power. 1 After the Tier 4 standards were fully in effect for all engine sizes, some boat builders informed EPA that there were no certified Tier 4 engines available with suitable performance characteristics for the vessels they needed to build, specifically for high-speed commercial vessels that rely on engines with rated power between 600 and 1,400 kW that have high power density.

To address these concerns, EPA proposed, and through this rule is adopting, provisions to provide additional lead time for implementing the Tier 4 standards for engines used in certain high-speed vessels (84 FR 46909, September 6, 2019). We are also finalizing the proposed approaches for streamlining certification requirements to facilitate or accelerate certification of Tier 4 marine engines with high power density. These changes are reflected in amendments to 40 CFR. 1042.145, 1042.505, and 1042.901 that we are making in this final rule. Each of these elements is discussed in more detail in this final rule.

The September 2019 proposed rule also included provisions related to in-use fuel sulfur standards that apply for global marine fuel. We adopted those regulatory amendments to 40 CFR part 80 in a separate rule (84 FR 69335, December 18, 2019).

The regulatory changes EPA is adopting in this final rule are largely the same as we proposed, with a few adjustments to address concerns raised by commenters. Several commenters also suggested that we broaden the scope of the rule to provide additional relief—either for a longer period or for a wider range of vessels. We are considering further rulemaking action to address these concerns, as described in Section VII.

EPA adopted emission standards for marine diesel engines under Clean Air Act authority (42 U.S.C. 7401-7671q). The amendments in this rule are covered by that same authority.

In 2008, EPA adopted Tier 3 and Tier 4 emission standards for new marine diesel engines with per-cylinder displacement less than 30 liters (73 FR 37096, June 30, 2008). The Tier 3 standards were based on engine manufacturers' capabilities to reduce particulate matter (PM) and oxides of nitrogen (NO X ) emissions with recalibration and other engine-based technologies. The Tier 4 standards were based on achieving emission reductions through the application of catalytic aftertreatment technology, including selective catalytic reduction (SCR). These Tier 4 standards currently apply to commercial marine diesel engines with rated power at or above 600 kW. The Tier 3 standards phased in for different engine sizes and power ratings from 2009 to 2014. The Tier 4 phase-in schedule applied these more stringent standards starting in 2014 to engines at or above 2,000 kW, which are most prevalent on large workboats that are less sensitive to engine size and weight concerns. The Tier 4 standards started to apply at the start of model year 2017 for engines from 1,000 to 1,400 kW, and on October 1, 2017 for engines from 600 kW to 999 kW. The schedule for applying the Tier 4 standards was intended to give engine manufacturers time to redesign and certify compliant engines, and to give boat builders time to redesign their vessels to accommodate the Tier 4 engines.

The 600 kW threshold for applying the Tier 4 standards was intended to avoid aftertreatment-based standards for small vessels used for certain applications that were most likely to be designed for high-speed operation with very compact engine installations. Most engines above 600 kW provide power for various types of workboats and larger passenger vessels. We were aware that there would be some high-speed vessels with engines above 600 kW, but expected that engine manufacturers would be able to certify 600-1,400 kW engines and vessel manufacturers would be able to make the necessary vessel design changes during the nine-year period between the final rule and the implementation of the Tier 4 standards.

In response to the proposal preceding the 2008 final rule, some commenters recommended that the Tier 4 standards apply to engines as small as 37 kW, because small land-based nonroad diesel engines were subject to similar aftertreatment-based standards. Other commenters at that time advocated a vessel-based approach, for example exempting engines installed on patrol boats and ferries from the Tier 4 standards. However, engine manufacturers commented that a vessel-based approach would be unworkable because they would then need to certify engines for a range of vessel types. Several commenters affirmed the 600 kW threshold as appropriate, and no commenters suggested a higher threshold. As a result, EPA finalized the 600 kW threshold without further limiting the Tier 4 standards to particular types of commercial vessels.

In the intervening years, only one engine manufacturer certified Tier 4 engines below 1,400 kW, and none of those had a power density greater than 35 kW per liter total engine displacement. 2 Engine manufacturers pointed to the cost of product development and certification rather than technological feasibility as the reason for delaying certification of Tier 4 engines. We also heard from manufacturers of high-speed vessels that the lack of certified Tier 4 engines with high power density was preventing them from building new vessels. Most of these concerns were related to lobster boats and pilot boats. Boat builders also told us that there would be greater challenges when installing SCR-equipped engines in these high-speed vessels.

When we adopted the Tier 4 standards in 2008, most if not all lobster boats used engines below 600 kW. Targeted lobster beds were typically located relatively close to shore. Lobster boats navigating in these areas have size and performance requirements that do not call for engines above 600 kW. Since 2008, however, it has become common to navigate to lobster beds 40 miles or farther from shore. The greater traveling distance necessitates more cargo space for a greater catch, and more speed to complete a day's work in a reasonable time. These factors caused a demand for larger vessels and more engine power, which led boat builders to install engines above 600 kW in lobster boats. Prior to the Tier 4 standards taking effect in 2017, engines for these lobster boats were subject to Tier 3 standards and thus required no aftertreatment technology. As a result, the lobster-boat engines needed for high speed and ocean navigation could fit into fiberglass hulls with minimal changes to fiberglass molds, or vessel design generally.

A complicating factor for pilot boats is other federal, state, or local programs that impose speed restrictions on vessels for certain vessel lengths. Specifically, pilot boats that operate in certain coastal areas are subject to whale-strike avoidance rules that are designed to protect migrating and calving right whales. In designated areas off the coast of Georgia, for example, vessels 65 feet and longer may not exceed an operating speed of 10 knots from November 1 to April 30 each year. 3 The whale-strike avoidance rules increase the demand for pilot boats that are less than 65 feet long. This additional constraint further complicates the challenge to design vessels with Tier 4 engines as the SCR emission control system takes up a significant amount of already limited space. Here again, the use of Tier 4 engines will require significant boat changes and more time is needed to resolve these challenges.

These concerns led us to propose provisions to allow additional lead time for implementing the Tier 4 standards for engines used in certain high-speed vessels, and to streamline Tier 4 certification requirements. The proposal identified several vessel and engine parameters that served as criteria to limit the additional lead time to qualifying vessels, rather than naming certain vessel types.

EPA benefitted from extensive input from engine manufacturers, boat builders, and other stakeholders before publishing the proposed rule and in the comments submitted during the comment period. This information helped to clarify the constraints, capabilities, processes, and concerns for engine manufacturers, vessel manufacturers, and others affected by the Tier 4 standards.

Since the middle of 2019, four additional engine manufacturers have certified Tier 4 engines with rated power between 600 and 1,400 kW. This expands the list of Tier 4 engine models that are available to provide power for a wider range of vessel types. However, these new engine certifications and the comments received do not change EPA's concerns as stated in the proposed rule that manufacturers of vessels for certain high-speed commercial applications continue to face important challenges associated with the availability of engines certified to the Tier 4 engine standards. These vessels have performance needs for achieving substantial propulsion power from a light-weight engine. In short, these vessel manufacturers have been unable to find certified Tier 4 engines meeting their requirements for maximum power, power density, and weight. See Section V for a more detailed discussion of the newly certified engines and the relationship to designing vessels with those Tier 4 engines.

In response to these concerns, and consistent with the proposed rule, EPA is adopting amendments to our marine diesel engine program to provide additional lead time to address these concerns for certain high-speed vessels. The new provisions allow engines installed on qualifying high-speed vessels to continue to meet Tier 3 standards during a relief period, which in turn will allow time for engine manufacturers to certify additional engine models, and for vessel manufacturers to implement design changes to their vessels to accommodate new Tier 4 engines as they become available.

The Tier 4 relief in this final rule addresses the concerns that led to the proposed rule. In particular, absent relief, boat builders would be unable to build the types of high-speed vessels identified in the proposed rule in the near term. This could result in boat purchasers sourcing new boats that are underpowered or prolonging the service life of older boats, perhaps including replacement of original engines with Tier 3 or dirtier engines. As more Tier 4 engines become available, boat builders will be able to design and build high-speed vessels that comply with Tier 4 requirements, consistent with the schedule we are specifying in this final rule. Section IV evaluates the cost and environmental impact of the relief provisions in this final rule.

Note that the new provisions allowing additional lead time for EPA's Tier 4 marine diesel engine standards are distinct from the international engine emission standards that apply under Annex VI to the International Convention for the Prevention of Pollution from Ships (MARPOL Annex VI). Because the domestic and international emission standards are adopted under different legal authorities, this rule has no bearing on the international standards. It is also the case that U.S. vessels operating only domestically are not subject to the standards adopted under MARPOL Annex VI (see 40 CFR 1043.10(a)(2)). As a result, the high-speed commercial vessels that are the subject of this rule will not be subject to emission standards under MARPOL Annex VI as long as they do not operate internationally.

In this rule, EPA is adopting revisions to the marine diesel engine emission control program for certain high-speed vessels and the associated engines with rated power between 600 and 1,400 kW. These changes provide more time for engine manufacturers to certify additional engine models and for vessel manufacturers to design and build boats with Tier 4 engines. We are also making changes to our certification requirements to facilitate certification, especially related to demonstrating the durability of emission controls.

The regulatory changes in this final rule are largely the same as we proposed, with a few adjustments in response to concerns raised by commenters. Several commenters also suggested that we broaden the scope of the rule to provide additional relief—either for a longer period or for a wider range of vessels. We are considering further rulemaking action to address these concerns, as noted in Section VII.

EPA is revising the Tier 4 implementation dates for certain types of marine diesel engines for installation in qualifying high-speed vessels. The additional time will allow vessel manufacturers to redesign their vessels to accommodate engines with the Tier 4 technology. Engine manufacturers have also indicated that the additional time will allow them to certify more engine models with high power density to the Tier 4 standards.

The new lead time provisions have two phases. The first phase sets model year 2022 as the Tier 4 implementation deadline for engines installed in high-speed vessels meeting a specific set of criteria. The second phase sets model year 2024 as the Tier 4 implementation deadline for engines installed in a narrower set of high-speed vessels that are facing a different set of compliance challenges.

We are applying the model year 2022 implementation date for Phase 1 relief, as proposed. This will allow boat builders time to redesign qualifying vessels to install certified Tier 4 engines. Available engines include currently certified models with total displacements of 24 and 32 liters. Engine manufacturers are also continuing to develop additional Tier 4 engine models.

The second phase addresses the different needs of manufacturers of fiberglass and other nonmetal vessels up to 50 feet long that need additional time to redesign their boats to use 600-1,000 kW engines certified to Tier 4 standards.

Boat builders and boat owners expressed a concern that the proposed additional lead time for both Phase 1 and Phase 2 was not adequate. For Phase 1, commenters requested some additional years to redesign vessels, and to find customers needing vessels during the relief period. Our intent in the proposed rule was to allow boat builders to address the dilemma of not being able to fill orders for building new boats because Tier 4 engines were not available. We did not intend, and do not support, a longer time frame that would allow boat builders to seek out expanded opportunities based on marketing the cost-saving advantages of Tier 3 compliant vessels for additional customers. The additional lead time associated with this proposed rule will allow vessel manufacturers to reconfigure vessels, create new tooling, and start producing compliant vessels.

Commenters representing the lobstering industry described their concerns that Tier 4 standards would be more challenging and may never be appropriate for vessels meeting the Phase 2 criteria. The types of lobster boats that need engines with more than 600 kW have size and performance characteristics that are best met with 15-18 liter engines. Larger engines, especially with SCR aftertreatment, are too large and heavy to provide a suitable alternative power source for these lobster boats. We are therefore adopting the Phase 2 relief, as proposed, to allow two additional years of lead time beyond the Phase 1 criteria, and a waiver process to address the possibility that Tier 4 engines will continue to be unavailable.

Vigor, Gladding-Hearn, and Ray Hunt Design requested that EPA clarify whether they would need to take certain steps before the end of the relief period for their vessels to qualify for the additional lead time. Implementation of new emission standards is based on a combination of build dates for the engines and the vessels. For example, Phase 1 relief expires in 2021, which means that engines qualifying for relief must have a date of manufacture in model year 2021 or earlier; i.e., crankshafts must be installed in those engine blocks on or before December 31, 2021. 4 Similarly, vessels qualify for relief only if their keels are laid on or before December 31, 2021. 5

At the same time, however, we are concerned that boat builders may lay keels and order engines speculatively to allow them to sell Tier 3 vessels for several years beyond the relief period. This practice would be contrary to the intent of the proposed relief. The program is intended to allow boat builders to meet existing demand for certain high-speed vessels where they are currently unable to supply those vessels. To prevent building up inventories of vessels during the relief period to circumvent the Tier 4 standards, we are adopting a requirement to limit the relief to vessels for which the boat builder has a written contract from a buyer to purchase a vessel. The contract must be signed before the end of the relief period.

Vessels qualify for relief if they meet certain criteria, as specified in the proposal and updated for this final rule.

Both phases of relief will be available only to engines installed on high-speed vessels. High-speed vessels may generally be characterized as planing vessels based on a hull design that causes the vessel to rise up out of the water and experience lower hydrodynamic drag (with a corresponding decrease in required propulsion power) when operating at high speed. This contrasts with displacement hulls, for which propulsion power continuously increases with increasing vessel speed. Vessels with displacement hulls do not experience the same design and installation challenges compared to planing hulls. While this distinction is straightforward, there is no generally accepted way to draw a clear line between the two types of vessels. This is illustrated by “semi-planing” vessels, which have operating characteristics that fall between planing and displacement vessels. We are adopting a vessel speed criterion, as proposed, that is consistent with industry practice. We are limiting relief to high-speed vessels that have a maximum operating speed (in knots) at or above 3.0 · L 1/2 , where L is the vessel's waterline length, in feet. This includes an upward adjustment of about 40 percent compared to published definitions to draw a clearer line to identify high-speed vessels. As an example, 45-foot vessels would need to have a maximum speed of at least 23 knots to qualify for relief using the specified threshold. Vessels not meeting the speed criterion either (1) are large enough to not have the same sensitivity to engine size and weight that should qualify them for relief from using Tier 4 engines or (2) do not need engines with more than 600 kW. In particular, vessels with displacement hulls that are less than 65′ long generally do not have engines with rated power above 600 kW. The vessel speed criterion applies equally to both phases of adjusted implementation dates for the Tier 4 standards.

Both phases of relief will be available to both inspected and uninspected commercial vessels. This is different from our proposal, which would have limited both phases of relief provisions to vessels classified as uninspected vessels by the U.S. Coast Guard. 6 Coast Guard designates all commercial vessels as either inspected or uninspected. Inspected vessels carry freight-for-hire or any hazardous or dangerous cargo. Towing and most passenger vessels are also inspected. In contrast, uninspected vessels include recreational vessels not engaged in trade, non-industrial fishing vessels, very small cargo vessels (less than 15 gross tons), and miscellaneous vessels such as pilot boats, patrol and other law-enforcement vessels, fire boats, and research vessels, among others. The Passenger Vessel Association, All American Marine, Gladding-Hearn, and Savannah Bar Pilots indicated that there are examples of inspected vessels that face the same issues related to engine availability and design constraints that apply for uninspected vessels. For example, pilot boats may be inspected or uninspected, depending on the owner's interest in expanding the use of a pilot boat to carrying some paying passengers. We agree that limiting relief to uninspected vessels may unnecessarily exclude some vessels for which relief was intended. We have therefore revised the final rule to remove this as a qualifying criterion. This change is necessary to accomplish the goal of the intended relief. We do not think this change will significantly expand the range or number of vessels that will qualify for relief, because other engine and vessel qualifying criteria will continue to limit the number of qualifying vessels.

Vessels qualify for additional lead time based on engine characteristics in addition to the vessel characteristics described above. Qualifying engines would need to be certified to EPA's Tier 3 standards and have certain characteristics related to power density and maximum power output. Specifically, the first phase of relief is limited to propulsion engines with maximum power output up to 1,400 kW, and power density of at least 27.0 kW per liter displacement, rather than the proposed 35.0 kW per liter displacement. In addition, we are limiting relief to engines that will be installed on vessels with a waterline length up to 65 feet with total nameplate propulsion power at or below 2,800 kW (to accommodate vessels with multiple propulsion engines). The combination of the limit on maximum power for each engine with the limit on the total nameplate propulsion power has the practical effect of limiting relief to vessels with one or two propulsion engines. These criteria are intended to target relief from the Tier 4 standards for the engines and vessels identified in the proposed rule as needing additional lead time.

The second phase of relief is limited to engines that will be installed on vessels with a single propulsion engine with maximum power output up to 1,000 kW and power density of at least 35.0 kW per liter displacement, where the vessel is made with a nonmetal hull and has a maximum waterline length of 50 feet. As noted in the proposed rule, we limited Phase 2 relief to fiberglass and other nonmetal hulls because of the cost of creating new hull forms, and because there is no option for a twin-engine installation for lobster boats or similar vessels less than 50′.

Gladding-Hearn and Ray Hunt Design requested that the regulation clearly state how to determine vessel length, and suggested referencing the U.S. Coast Guard regulations at 46 CFR 175.400. We agree with these comments and are adding a regulatory definition of “waterline length” in 40 CFR 1042.901 that references the Coast Guard regulation. This includes language defining a worst-case condition representing maximum vessel loading and minimum water density. This is intended to prevent a situation in which a vessel could exceed specified length limits as a result of changing conditions.

We proposed power density criteria of 35.0 and 40.0 kW per liter displacement for Phase 1 and Phase 2, respectively. The proposed criteria were intended to focus the relief on lightweight engines needed for the affected high-speed vessels. However, boat builders expressed a concern that the proposed value might reduce the number of available Tier 3 engines to the point that the relief provisions would not allow them to build the vessels as contemplated in the proposed rule. Vigor and Savannah Bar Pilots identified 27 kW/liter as an alternative qualifying threshold to allow a wider range of engines that could be used with vessels qualifying for relief. Similarly, Gladding-Hearn and Ray Hunt Design identified 24 kW/liter as an alternative qualifying threshold. The 24 kW/liter value was based on an engine model with 57 liters total displacement, and the 27 kW/liter value was based on an engine model with 38 liters total displacement. We agree that a wider range of power density values is appropriate to accomplish the rule's objectives and are therefore adjusting the power density thresholds for the final rule. We selected the 27 kW/liter threshold because the 38-liter engine is a viable option for vessels qualifying for Phase 1 relief, while the 57-liter engine is much too large to be a viable option for these vessels. If we consider relief for additional types of vessels in a future rulemaking, as described in Section VII, we may reconsider the appropriate qualifying criteria for engines installed on those vessels.

These commenters suggesting lower power density thresholds made clear that weight considerations are a secondary engine parameter in designing high-speed vessels. For example, a 38-liter engine at 27 kW/liter provides about 1,100 kW of propulsion power. An engine could achieve the same power output with only 29 liters total displacement if the engine had power density at 35 kW/liter. The incremental engine weight of adding SCR to a 29-liter engine is probably less than the added weight of the larger engine without SCR. We therefore conclude that space and packaging rather than engine weight are the limiting factor in designing compliant high-speed vessels. This helps us to understand the range of engine characteristics that will be suitable for these vessels when the Tier 4 standards apply.

Table 1 summarizes the provisions we are adopting for additional lead time in this rule. This takes the form of a revised Tier 4 implementation schedule for propulsion engines with high power density.

Only those engines and vessels that meet the criteria we are finalizing in this rule qualify for the revised Tier 4 implementation dates. An engine installed in a nonqualifying vessel, or a nonqualifying engine installed on any vessel, is subject to the prohibitions set out in 40 CFR 1068.101(a)(1) for new engines and vessels introduced into U.S. commerce, and would therefore be in violation.

In addition to the above provisions, several commenters suggested other adjustments to the proposed criteria to broaden the scope of relief. Section V includes our response to those comments.

Engine manufacturers will need to certify engines above 600 kW to the Tier 3 commercial standards for installation in newly constructed vessels that meet the qualifying criteria before vessel manufacturers can utilize the additional lead time provided in this final rule. Boat builders may need these Tier 3 engines very soon after we finalize this rule. To do this, engine manufacturers would generally need to restart production of engine configurations that were already certified to the Tier 3 commercial standards. Engine manufacturers may still be producing these or substantially equivalent engine configurations as certified Tier 3 recreational engines, as exempt replacement engines, or as engines for export. In most cases, engine manufacturers can resubmit information from their earlier Tier 3 application for certification to cover the new production.

Vigor, Gladding-Hearn, Ray Hunt Design, Savannah Bar Pilots, and Columbia River Pilots asked EPA to allow installation of recreational Tier 3 engines in commercial vessels during the relief period. We are not adjusting our program to allow this. Since the beginning of our emission control program for marine diesel engines, we have prohibited installation of recreational engines in commercial vessels. Recreational engines have a much shorter useful life and therefore cannot provide reliable emission control in a commercial application. However, engine manufacturers can consider qualifying their recreational marine engines as light-commercial marine engines meeting a reduced useful life of 5,000 hours, as described in Section III.E.2. Except for that accommodation, we still find it important to disallow installation of recreational engines in commercial vessels. For manufacturers using the new provision for a reduced useful life, we will be ready to work with engine manufacturers to apply the provisions of 40 CFR 1042.245(b) to determine appropriate deterioration factors (see Section III.E.1).

Based on input received from engine manufacturers after the comment period, we expect boat builders to have several available Tier 3 engine models. Several manufacturers indicated publicly that they intend to pursue certification for Tier 3 commercial engines above 600 kW during the relief period, including Caterpillar (18-liter and 32-liter), MTU (22-liter and 27-liter) and Scania (16-liter). We are aware of additional engine manufacturers that may also pursue Tier 3 certification for engines above 600 kW.

EPA is adopting waiver provisions that start to apply in 2024 for vessels meeting the Phase 2 specifications described in Table 1. These waiver provisions are intended to allow boat builders to continue building boats with Tier 3 engines if engine manufacturers have not yet certified suitable engines for those vessels.

Starting in 2024, manufacturers of vessels meeting the Phase 2 qualifications described in Table 1 have the option to request that EPA approve an exemption from the Tier 4 standards. EPA will evaluate these requests based on the availability of suitable certified Tier 4 engines at the time of the request for the intended vessel design. EPA may approve requests covering multiple vessels, but any approval will apply only for the number of vessels approved for relief. The waiver authority does not expire, so EPA would be able to continue approving manufacturers' requests to install Tier 3 engines in qualifying vessels until suitable certified Tier 4 engine models become available.

The Passenger Vessel Association, Vigor, Savannah Bar Pilots, and Columbia River Pilots suggested that the waiver process should also apply for all vessels meeting the Phase 1 qualifying criteria. As noted above, the waiver provisions are intended to allow for continued boat building in case there continue to be no suitable Tier 4 engines for the targeted vessels. In 2022 and later, we expect boat builders to be able to choose from several Tier 4 engine models between 20 and 40 liters total displacement. It will take time to modify vessel designs to accommodate Tier 4 engine technologies, but it is reasonable to expect the available Tier 4 engines to be suitable for the Phase 1 vessels. As mentioned above and described in Section VII, we are considering a separate rulemaking proposal to address remaining questions about the availability of Tier 4 engines for other types of high-speed vessels where there may not yet be suitable Tier 4 engines.

EMA stated that they do not support extending Tier 4 relief for a longer period than we proposed. They specifically objected to specifying 2028 as the year for applying the Tier 4 standards for Phase 2 relief based on engine manufacturers' need to start selling Tier 4 engines to recover their development costs. They also expressed a concern that waiver provisions could be disruptive for product planning if the waiver approval would not be well defined or if it extended more than one year beyond the adjusted starting date of the Tier 4 standards. We agree that adding several years of lead time would not be an effective way to support the engine manufacturers' development and certification programs for Tier 4 engines. The waiver process is preferable because it allows us to limit relief in 2024 and later to cases in which there are no suitable engines certified to the Tier 4 standards. For example, engine manufacturers have not committed to certifying Tier 4 engines below 20 liters, and if that is still the case and raised in a request for a waiver, it may be appropriate not to limit a waiver to a single year beyond the adjusted start date for the Tier 4 standards. Conversely, if an engine manufacturer certifies an engine model that is suitable for powering vessels that would otherwise meet the specified Phase 2 criteria, it would be appropriate to deny the waiver request. The waiver provisions spell out the approval criteria needed for EPA to evaluate any future requests for relief; the approval process with the approval criteria adequately define the terms of the waiver to avoid arbitrary decision-making that would be disruptive for engine manufacturers and their product planning.

Engine manufacturers told us that one of the biggest factors delaying their plans to certify Tier 4 engines in the 600 to 1,400 kW power range is the expected low sales volumes that make it harder to recover the investment needed to develop marine-specific calibrations and perform the testing needed to certify engines under 40 CFR part 1042. We understand engine manufacturers' concerns to recover their investment in designing and certifying compliant engines. The market for compliant engines is expected to grow as more engines are needed internationally to comply with the stringent emission standards adopted for NO X Emission Control Areas under MARPOL Annex VI. Manufacturers are also expected to redesign their engines to comply with the stringent marine diesel engine emission requirements for vessels operating on inland waterways in Europe. The stringency of the European standards is similar to EPA's Tier 4 standards for NO X emissions and is more stringent for PM emissions. These standards will therefore contribute to further development and installation of advanced emission controls.

To facilitate certification of engines meeting the EPA Tier 4 standards, we are adopting revised engine certification requirements aimed at reducing engine manufacturer compliance and certification costs for the affected engines. These provisions are intended to help accelerate the market entry of additional Tier 4 marine engines, and additional power ratings for engines already certified to Tier 4 standards.

We are adopting a temporary provision allowing engine manufacturers to certify specific engines to Tier 4 standards based on assigned deterioration factors. Engine manufacturers rely on deterioration factors so they can test a new engine and adjust the test results mathematically to represent emission levels at full useful life. Before this rule, the regulations for certifying marine diesel engines have allowed assigned deterioration factors only for small-volume engine manufacturers and post-manufacture marinizers. Assigned deterioration factors reduce the cost and time to certify to Tier 4 standards, which could accelerate the schedule for certifying, and may lead manufacturers to decide to pursue Tier 4 certification in light of the expected low sales volumes for recovering the associated development costs.

To encourage development of additional engine options for high-speed vessels, we will allow assigned deterioration factors for engines with power density above 30.0 kW/liter displacement. This applies through 2024 for 1,000-1,400 kW engines, and through model year 2026 for 600-1,000 kW engines. These dates are set to apply for the first three years after the Tier 4 standards start to apply on the adjusted schedule, with the expectation that engine manufacturers could accumulate information on the durability characteristics of engines during those three model years before needing to develop family-specific deterioration factors.

The proposal specified that assigned deterioration factors would be available for two years for engines with power density above 35.0 kW/liter. Engine manufacturers' comments requested that we allow assigned deterioration factors down to 30.0 kW/liter, and for a year longer than we proposed. They suggested the changes to ensure that the amended provisions would together create the appropriate reduction in development costs needed to achieve the objective of getting additional engines certified to the Tier 4 standards. We had selected the proposed thresholds for power density mostly to prevent adverse competitive effects for manufacturers that had already certified to Tier 4 standards. We realize, however, that even those manufacturers with certified engines can benefit from the new flexibility for certifying additional engine families.

We have reviewed available data to support default values for assigned deterioration factors. The deterioration factors are multiplicative values of 1.1 for NO X and 1.4 for HC and CO, and an additive value of 0.003 g/kW-hr for PM. 7 These are the same values specified for the proposed rule. Where an individual engine manufacturer has existing data available, such as from certified land-based versions of its marine engines, EPA would consider that information, consistent with 40 CFR 1042.245(b), and may adjust the value of one or more default assigned deterioration factors accordingly.