OCC regulations require national banks and federal savings associations to file Suspicious Activity Reports (SARs) under certain conditions. These regulations also provide for: (i) Board of director notification; (ii) filing exceptions; (iii) SAR confidentiality; (iv) recordkeeping requirements; (v) supporting documentation requirements; and (vi) limitations on liability. Requirements related to SARs are codified at 12 CFR 21.11 for national banks and 12 CFR 163.180 for federal savings associations. This proposed rule would amend those sections to allow the OCC to issue exemptions from the regulations' SAR requirements.

The OCC has long required its regulated institutions to report potential violations of law arising from transactions that flow through those institutions. 1 The OCC required such reporting because fraud, abusive insider transactions, check-kiting schemes, money laundering, and other financial crimes can pose serious threats to a financial institution's continued viability and, if unchecked, can undermine the public confidence in the nation's financial system generally. 2

In 1992 Congress passed the Annunzio-Wylie Anti-Money Laundering Act, which redesigned the criminal referral process applicable to OCC supervised entities and made the reporting of certain suspicious transactions a requirement of the Bank Secrecy Act (BSA). 3 The Act permitted the Department of the Treasury to require financial institutions, including national banks and federal savings associations, to “report any suspicious transaction relevant to a possible violation of law or regulation.”  4 As a result, the Department of the Treasury, in consultation with the OCC, the other federal banking agencies, and law enforcement, developed the modern SAR form and reporting process, which standardized the reporting forms and created a centralized database that could be accessed by multiple law enforcement and regulatory agencies.

To implement this new reporting system, the Financial Crimes Enforcement Network of the Department of the Treasury (FinCEN) issued its implementing SAR regulations in 1996 for financial institutions subject to the requirements of the BSA to, among other things, specifically address the reporting of money laundering transactions and transactions designed to evade the reporting requirements of the BSA. 5 To further implement this new reporting process and reduce unnecessary reporting burdens, the OCC and the other federal banking agencies contemporaneously amended their criminal referral form regulations to incorporate the new SAR form and reporting database, align their regulatory reporting requirements with FinCEN's BSA reporting requirements, and further refine the reporting processes. 6

As a result of this redesign and FinCEN's implementing regulations, national banks and federal savings associations are currently required to file SARs under both OCC and FinCEN regulations. These regulations are not identical but are substantially similar with regard to the specified BSA reporting obligations required by FinCEN. Both the OCC's and FinCEN's SAR regulations require banks to file SARs relating to money laundering, transactions that are designed to evade the reporting requirements of the BSA, and transactions that have no business or apparent lawful purpose or are not the sort in which the particular customer would normally be expected to engage, and the bank knows of no reasonable explanation for the transactions after examining the available facts, including the background and possible purpose of the transactions. 7 Furthermore, with respect to the SAR confidentiality requirements in the BSA, both the OCC's and FinCEN's SAR regulations require banks to maintain the confidentiality of a SAR and any information that would reveal the existence of the SAR, outside of certain circumstances.

While the OCC and FinCEN regulations contain substantively similar requirements, including requiring reporting in certain common contexts and requiring institutions to maintain the confidentiality of SARs, the OCC and the other federal banking agencies require reporting in broader circumstances ( e.g., insider abuse at any dollar amount). 8 As previously noted, these violations and abuse situations can pose serious threats to financial institutions' continued viability and, if unchecked, can undermine the public confidence in the nation's financial industry.

The OCC and FinCEN SAR regulations also provide: (i) That SARs are not required for a robbery or burglary committed or attempted that is reported to appropriate law enforcement authorities; (ii) that SARs are confidential and shall not be disclosed except as authorized; (iii) recordkeeping requirements for SARs and supporting documentation; (iv) that supporting documentation shall be deemed to have been filed with the SAR; and (v) that supporting documentation shall be made available to appropriate law enforcement agencies upon request. The regulations also provide a limitation on liability to any national bank, federal savings association or other financial institution and any director, officer, employee, or agent of a national bank or federal savings association or other financial institution that makes a voluntary disclosure of any possible violation of law or regulation to a government agency or files a SAR pursuant to the regulations or any other authority. The OCC's regulations also contain a provision requiring that national banks and federal savings associations promptly notify their board of directors when a SAR has been filed.

While neither the OCC's SAR regulations nor FinCEN's SAR reporting regulation contain provisions permitting exemptions, FinCEN has general authority to grant exemptions from the requirements of the BSA, which includes granting exemptions under its SAR reporting regulations. 9 FinCEN's regulation provides that “[t]he Secretary [of Treasury], in his sole discretion, may by written order or authorization make exceptions to or grant exemptions from the requirements of [the BSA]. Such exceptions or exemptions may be conditional or unconditional, may apply to particular persons or to classes of persons, and may apply to transactions or classes of transactions.”  10 The Secretary has delegated this exemption authority to FinCEN.

This disparity in exemption authority makes it more difficult for the OCC to grant relief if a national bank or federal savings association has a novel SAR filing proposal that does not squarely fit within the regulatory requirements but would nonetheless be beneficial from an anti-money laundering regulatory and safety and soundness perspective. As financial technology and innovation continue to develop in the area of monitoring and reporting financial crime and terrorist financing, the OCC will need the express regulatory flexibility to grant exemptive relief when appropriate in this area on a consistent basis. In 2018 the OCC, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, FinCEN, and the National Credit Union Administration issued a statement encouraging banks to take innovative approaches to meet their BSA/anti-money laundering (BSA/AML) compliance obligations. 11 That statement explained that banks are encouraged to consider, evaluate, and, where appropriate, responsibly implement innovative approaches in this area. Today, innovative approaches and technological developments in the areas of SAR monitoring, investigation, and filings may involve, among other things: (i) Automated form population using natural language processing, transaction data, and customer due diligence information; (ii) automated or limited investigation processes depending on the complexity and risk of a particular transaction and appropriate safeguards; and (iii) enhanced monitoring processes using more and better data, optical scanning, artificial intelligence, or machine learning capabilities. Requests for exemptive relief pertaining to innovation or other matters may involve, among other things, expanded investigations and SAR timing issues, SAR disclosures and sharing, continued SAR filings for ongoing activity, outsourcing of SAR processes, the role of agents of national banks and federal savings associations, the use of shared utilities and shared data, and the use and sharing of de-identified data. OCC expects that new technologies will continue to prompt additional innovative approaches related to SAR filing and monitoring.

The proposed rule would allow the OCC to issue exemptions from the requirements of its SAR regulations. Specifically, the proposed rule would add a provision to 12 CFR 21.11 and 12 CFR 163.180 that would provide that the OCC may exempt a national bank or federal savings association from the requirements of those sections.

As discussed above, the OCC's SAR regulations contains some requirements that are not included in FinCEN's SAR regulation. For exemption requests involving these OCC additional SAR requirements, a national bank or federal savings association would only need to seek an exemption from the OCC. The OCC believes that the proposed process is consistent with the purposes of the BSA and with safe and sound banking. For exemption requests from the requirements of the OCC's SAR regulations that would also require an exemption from FinCEN's SAR regulation, for example, exemption requests related to SAR filings required by 12 CFR 21.11(c)(4), or related to SAR timing requirements in 12 CFR 21.11(d), or related to SAR confidentiality in 12 CFR 21.11(k), a national bank would need to seek an exemption from both the OCC and FinCEN.

Under the proposed rule, a national bank requesting an exemption from the requirements of 12 CFR 21.11, including exemptions related to SAR filings solely required by paragraphs (c)(1) through (3), must submit a request in writing to the OCC. In reviewing such requests, the OCC would consider whether the exemption is consistent with safe and sound banking, and any other appropriate factors, such as any outstanding supervisory concerns related to BSA/AML, including informal and formal enforcement actions.

A national bank or federal savings association requesting an exemption from the requirements of the OCC's SAR regulations that would also require an exemption from FinCEN's SAR regulation, for example, an exemption request related to SAR filings under 12 CFR 21.11(c)(4) for national banks, would have to submit a request in writing to both the OCC and to FinCEN for approval. Upon receiving a written request from a national bank or federal savings association, the OCC would consider whether the exemption is consistent with the purposes of the Bank Secrecy Act, with safe and sound banking, and any other appropriate factors, such as any outstanding supervisory concerns related to BSA/AML, including informal and formal enforcement actions. With respect to requests for exemption from the requirements of the OCC's SAR regulations that would also require an exemption from FinCEN's SAR regulation, the requestor would have to obtain exemptions from both agencies.

The OCC also may notify the other federal banking agencies and consider their comments before granting any exemption. Such exemptions may be conditional or unconditional, may apply to particular persons or to classes of persons, and may apply to transactions or classes of transactions. In addition, the proposed rule provides that the OCC may grant an exemption for a specified time period.

Under the proposed rule, the OCC could also revoke previously granted exemptions if circumstances change related to the factors set out above ( e.g., consistency with the BSA and safety and soundness) or any imposed conditions. The OCC invites comments on the proposed rule, including whether any additional detail relating to the procedures that would be followed in considering, granting, or revoking exemptions is necessary. The OCC welcomes comments on any aspect of the proposed rule, in particular, with regard to whether additional or different factors or standards should be applied in the determination whether to grant an exemption request, as well as the form and manner of the OCC's response to an exemption request.

Section 722 of the Gramm-Leach-Bliley Act  12 requires the federal banking agencies to use plain language in all proposed and final rules published after January 1, 2000. The OCC has sought to present the proposed rule in a simple and straightforward manner, and invite comment on the use of plain language. For example:

• Has the OCC organized the material to suit your needs? If not, how could the OCC present the proposed rule more clearly?

• Are the requirements in the proposed rule clearly stated? If not, how could the proposed rule be more clearly stated?

• Do the regulations contain technical language or jargon that is not clear? If so, which language requires clarification?

• Would a different format (grouping and order of sections, use of headings, paragraphing) make the regulation easier to understand? If so, what changes would achieve that?

• Would more, but shorter, sections be better? If so, which sections should be changed?

• What other changes can the OCC incorporate to make the regulation easier to understand?

Certain provisions of the proposal contain “collection of information” requirements within the meaning of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521) (PRA). In accordance with the requirements of the PRA, agencies may not conduct or sponsor, and a respondent is not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (OMB) control number. The OCC reviewed the proposed rulemaking and determined that it revises information collection requirements previously approved by OMB under OMB Control No. 1557-0180. The OCC has submitted the revised information collection to OMB for review under section 3507(d) of the PRA (44 U.S.C. 3507(d)) and § 1320.11 of the OMB's implementing regulations (5 CFR part 1320).

Current Actions. The proposal would revise 12 CFR 21.11 and 12 CFR 163.180 to allow national banks and federal savings associations to submit written requests for exemptions from the requirements of the OCC's SAR regulations. The burden estimates below are based on the estimated number of banks and savings associations that might request such exemptions each year and the estimated number of hours required to submit such a request. National banks and federal savings associations may submit written requests for exemptions from the requirements of the OCC's SAR regulations. 12 CFR 21.11(m) and 163.180(f).

Title of Information Collection: Minimum Security Devices and Procedures, Reports of Suspicious Activities, and Bank Secrecy Act Compliance Program.

Frequency: Event generated.

Affected Public: Businesses or other for-profit.

Estimated number of respondents: 5.

Total estimated annual burden: 250 hours.

Comments are invited on:

a. Whether the collections of information are necessary for the proper performance of the agencies' functions, including whether the information has practical utility;

b. The accuracy or the estimate of the burden of the information collections, including the validity of the methodology and assumptions used;

c. Ways to enhance the quality, utility, and clarity of the information to be collected;

d. Ways to minimize the burden of the information collections on respondents, including through the use of automated collection techniques or other forms of information technology; and

e. Estimates of capital or startup costs and costs of operation, maintenance, and purchase of services to provide information.

All comments will become a matter of public record. Comments on aspects of this document that may affect reporting, recordkeeping, or disclosure requirements and burden estimates should be sent to the addresses listed in the ADDRESSES section of this document. A copy of the comments may also be submitted to the OMB desk officer for the agencies by mail to U.S. Office of Management and Budget, 725 17th Street NW, #10235, Washington, DC 20503; facsimile to (202) 395-6974; or email to oira_submission@omb.eop.gov, Attention, Federal Banking Board Desk Officer.

The Regulatory Flexibility Act, 5 U.S.C. 601 et seq., (RFA), requires an agency, in connection with a proposed rule, to prepare an Initial Regulatory Flexibility Analysis describing the impact of the rule on small entities (defined by the SBA for purposes of the RFA to include commercial banks and savings institutions with total consolidated assets of $600 million or less and trust companies with total consolidated assets of $41.5 million of less) or to certify that the proposed rule would not have a significant economic impact on a substantial number of small entities.

As part of our analysis, we consider whether the proposal would have a significant economic impact on a substantial number of small entities, pursuant to the RFA. The OCC currently supervises approximately 745 small entities. 13 Because the proposal imposes no new mandates, it would have only de minimis costs to OCC-supervised small entities. Therefore, the OCC certifies that the proposal would not have a significant economic impact on a substantial number of small entities.

Pursuant to section 302(a) of the Riegle Community Development and Regulatory Improvement Act (RCDRIA), in determining the effective date and administrative compliance requirements for new regulations that impose additional reporting, disclosure, or other requirements on insured depository institutions, each federal banking agency must consider, consistent with principles of safety and soundness and the public interest, any administrative burdens that such regulations would place on insured depository institutions, including small depository institutions, and customers of depository institutions, as well as the benefits of such regulations. 14 In addition, section 302(b) of RCDRIA requires new regulations and amendments to regulations that impose additional reporting, disclosures, or other new requirements on insured depository institutions generally to take effect on the first day of a calendar quarter that begins on or after the date on which the regulations are published in final form. 15 The OCC requests comment on any administrative burdens that the proposed rule would place on depository institutions, including small depository institutions, and their customers, and the benefits of the proposed rule that the OCC should consider in determining the effective date and administrative compliance requirements for a final rule

Consistent with the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 1532, the OCC considers whether the proposed rule includes a Federal mandate that may result in the expenditure by state, local, and tribal governments, in the aggregate, or by the private sector, of $100 million adjusted for inflation (currently $157 million) in any one year. The proposed rule does not impose new mandates. Therefore, the OCC concludes that implementation of the proposed rule would not result in an expenditure of $157 million or more annually by state, local, and tribal governments, or by the private sector.

Pursuant to the Board's Regulations H, K, and Y, state member banks, Edge and agreement corporations, U.S. offices of foreign banking organizations supervised by the Federal Reserve, and bank holding companies and their nonbank subsidiaries must file Suspicious Activity Reports (SARs) to report known or suspected violations of U.S. law. 1 The proposed rule would amend the Board's SAR regulations to expressly provide for exemptions from the regulations' SAR requirements, in full or in part and subject to the Board's approval.

The Board, along with the other federal banking agencies, is charged with safeguarding the safety and soundness of its supervised institutions. Pursuant to its safety-and-soundness authority and enabling statutes, the Board has long required a member bank, a bank holding company and its nonbank subsidiaries, an Edge Act or Agreement corporation, or a U.S. branch or agency of a foreign bank to refer potential violations of law arising from transactions that flow through those institutions to relevant law enforcement authorities, because financial crimes can pose serious threats to a financial institution's continued viability and, if unchecked, may undermine the public confidence in the financial services industry. 2

In 1992, Congress passed the Annunzio-Wylie Anti-Money Laundering Act, which redesigned the criminal referral process applicable to Board-supervised entities and made the reporting of certain suspicious transactions a requirement of the Bank Secrecy Act (BSA). 3 The Act permitted the Department of the Treasury to require financial institutions to “report any suspicious transaction relevant to a possible violation of law or regulation.”  4 Thereafter, the Department of the Treasury, in consultation with the federal banking agencies and law enforcement, developed the modern SAR form and reporting process, which standardized the reporting forms, eliminated duplicate filings, and created a centralized database that could be accessed by multiple law enforcement and regulatory agencies.

To implement this new reporting system, the Financial Crimes Enforcement Network (FinCEN), a bureau of the Department of the Treasury, issued its implementing SAR regulations in 1996. The regulations require financial institutions subject to the requirements of the BSA to, among other things, specifically address the reporting of money laundering transactions and transactions designed to evade the reporting requirements of the BSA. 5

To further implement this new reporting process and reduce unnecessary reporting burdens, the Board and the other federal banking agencies contemporaneously amended their criminal referral form regulations to incorporate the new SAR form and reporting database, align their regulatory reporting requirements with FinCEN's BSA reporting requirements, and further refine the reporting processes. 6

As a result of this redesign and FinCEN's implementing regulations, relevant institutions supervised by the Board are currently required to file SARs under both the Board's and FinCEN's SAR regulations. These regulations are not identical but are substantially similar with regard to the specified BSA reporting obligations required by FinCEN, in that they both require banks, among other things, to file SARs relating to money laundering and transactions designed to evade BSA reporting requirements, as well as maintain the confidentiality of a SAR in most circumstances. However, the Board's SAR regulations cover a slightly broader range of transactions, for example, by requiring SARs to be filed for any known or suspected instance of insider abuse in any amount, and further requiring the prompt notification to the institution's board of directors when a SAR has been filed.

The Secretary of the Treasury has statutory authority to grant exemptions from the requirements of the BSA, which includes FinCEN's SAR requirements. 7 The regulation implementing this exemption authority provides:  8

The policy objective of the proposed rule is to allow the FDIC to grant SAR filing exemptions, in conjunction with the Financial Crimes Enforcement Network of the Department of the Treasury (FinCEN), to FDIC-supervised institutions that develop innovative solutions to meet BSA requirements more efficiently and effectively. The FDIC is proposing this rule as a proactive measure to address the likelihood that FDIC-supervised institutions will leverage existing or future technologies to report information concerning suspicious activity in a different manner or time frame or to share SAR-related information. This change would more closely align the FDIC's regulation with FinCEN's regulation. FinCEN, unlike the FDIC, has broad statutory authority to issue exemptions from the SAR filing requirements. Because the FDIC's SAR regulations do not currently contain any provision by which the FDIC can issue case-by-case exemptions, a situation could arise in which FinCEN grants an exemption from the SAR filing requirements to an FDIC-supervised institution, but the institution would still need to file a SAR if the circumstance fell within the FDIC's SAR rule. The proposed rule would allow the FDIC to grant exemptions from SAR filing requirements in conjunction with FinCEN to reduce potential regulatory burden when a request involves the SAR filing requirements of both FinCEN and the FDIC.

The FDIC has long required its supervised institutions to report potential violations of law arising from transactions that flow through those institutions. From 1986 to 1996, FDIC-supervised institutions filed criminal referral forms with the FDIC, Federal Bureau of Investigation, and the local U.S. Attorney's office. 1 The FDIC required reporting through criminal referral forms to facilitate the reporting of potential violations to law enforcement.

In 1992, Congress passed the Annunzio-Wylie Anti-Money Laundering Act, which redesigned the criminal referral process applicable to FDIC-supervised institutions and made the reporting of certain suspicious transactions a requirement of the BSA. 2 The Annunzio-Wylie Anti-Money Laundering Act permitted the Department of the Treasury to require financial institutions, including FDIC-supervised institutions, to “report any suspicious transaction relevant to a possible violation of law or regulation.”  3 Thereafter, the Department of the Treasury, in consultation with the FDIC, the other federal banking agencies, and law enforcement, developed the modern SAR form and reporting process, which standardized the reporting forms and created a centralized database that could be accessed by multiple law enforcement and regulatory agencies.

To implement this new reporting system, FinCEN implemented its SAR regulation in 1996  4 for financial institutions subject to BSA requirements to address, among other things, the reporting of money laundering transactions and transactions designed to evade the reporting requirements of the BSA. 5 To further implement this new reporting process and reduce unnecessary reporting burdens, the FDIC and the other federal banking agencies contemporaneously amended their criminal referral form regulations to incorporate the new SAR form and reporting database, align their regulatory reporting requirements with FinCEN's reporting requirements, and further refine the reporting processes. 6

As a result of this redesign and FinCEN's implementing regulation, FDIC-supervised institutions are currently required under both FDIC and FinCEN regulations to file SARs. These regulations are not identical but are substantially similar. Both SAR regulations require, among other things, FDIC-supervised institutions to file SARs relating to money laundering and transactions that are designed to evade the reporting requirements of the BSA, as well as maintain the confidentiality of a SAR in most circumstances. 7 However, the FDIC's SAR regulation covers a slightly broader range of transactions, for example, by requiring SARs to be filed for any known or suspected instance of insider abuse in any amount, and further requiring the prompt notification to the institution's board of directors when a SAR has been filed.

FinCEN has general authority to grant exemptions from the BSA's requirements, which includes granting exemptions under its SAR reporting regulation. 8 FinCEN's regulation provides that “[t]he Secretary [of Treasury], in his sole discretion, may by written order or authorization make exceptions to or grant exemptions from the requirements of [the BSA]. Such exceptions or exemptions may be conditional or unconditional, may apply to particular persons or to classes of persons, and may apply to transactions or classes of transactions.” The Secretary of Treasury delegated this exemption authority to FinCEN. In contrast, the FDIC's SAR regulations contain a discrete set of filing exemptions pertaining to physical crimes (robberies and burglaries), and lost, missing, counterfeit, or stolen securities.

This disparity in exemptions makes it more difficult for the FDIC to grant relief if an FDIC-supervised institution has a novel SAR filing proposal that does not squarely fit within the FDIC's regulatory requirements, but would nonetheless be consistent with safe and sound banking and with the BSA. As financial technology and innovation continue to develop in the area of monitoring and reporting financial crime and terrorist financing, the FDIC will need the express regulatory flexibility to grant exemptive relief when appropriate in this area.

Moreover, in 2018, the FDIC, the Board of Governors of the Federal Reserve System, the National Credit Union Administration, the Office of the Comptroller of the Currency, and FinCEN issued a statement encouraging banks to take innovative approaches to meet their BSA/Anti-Money Laundering compliance obligations. 9 The statement explained that banks  10 are encouraged to consider, evaluate, and where appropriate, responsibly implement innovative approaches in this area. Today, innovative approaches and technological developments in the areas of SAR monitoring, investigation, and filing may involve, among other things: (i) Automated form population using natural language processing, transaction data, and customer due diligence information; (ii) automated or limited investigation processes depending on the complexity and risk of a particular transaction and appropriate safeguards; and (iii) enhanced monitoring processes using more and better data, optical scanning, artificial intelligence, or machine learning capabilities. Requests for exemptive relief pertaining to innovation or other matters may involve, among other things, expanded investigations and SAR timing issues, SAR disclosures and sharing, continued SAR filings for ongoing activity, SAR outsourcing of responsibilities and practices, the role of agents of FDIC-supervised institutions, the use of shared utilities and shared data, and the use and sharing of de-identified data (commonly referred to as anonymized data). The FDIC expects that new technologies will continue to prompt additional innovative approaches related to suspicious activity monitoring and SAR filing.

If the FDIC adopts the proposed rule and uses it to grant exemptions, the exemptions would not relieve FDIC-supervised institutions from the obligation to comply with FinCEN's SAR regulation when applicable. To the extent an exemption request from an FDIC-supervised institution involves both the FDIC's SAR regulation and FinCEN's SAR regulation, the FDIC-supervised institution would need an exemption from both the FDIC and FinCEN. The FDIC expects to coordinate with FinCEN when handling parallel exemptions. As explained above, however, the FDIC's SAR regulation imposes additional requirements not included in FinCEN's SAR regulation. To the extent an exemption request is subject to a requirement imposed by the FDIC's SAR regulation alone (and not a parallel FinCEN requirement), the proposed rule would allow the FDIC to exempt a supervised institution from that requirement.

The proposed rule would add three paragraphs to 12 CFR 353.3(d) of the FDIC Rules and Regulations that would permit the FDIC to exempt a supervised institution from the requirements, in full or in part, of 12 CFR 353.3. Under the proposed rule, the FDIC in evaluating an exemption request would determine whether the request is consistent with safe and sound banking, and may consider other appropriate factors. The FDIC would also seek FinCEN's determination whether the exemption request is consistent with the purposes of the BSA, as applicable, where an exemption request involves the filing of a SAR for potential money laundering, violations of the BSA, or other unusual activity covered by FinCEN's SAR regulation. When a request involves the SAR filing requirements of both FinCEN and the FDIC, the proposed rule would require the FDIC to seek FinCEN's concurrence. In addition, the proposed rule provides that the FDIC may grant an exemption for a specified time period. The supervised institution would then be able to rely on the exemption for a period of time as determined and communicated by the FDIC. Under the proposed rule, the FDIC could also extend or revoke previously granted exemptions if circumstances change related to the factors set out above (consistent with the BSA and safety and soundness), or any imposed conditions.

Section 353.3(d) sets forth exemptions from the FDIC's SAR regulation. Currently, Section 353.3(d)(1) exempts FDIC-supervised institutions from filing a SAR for a committed or attempted robbery or burglary that is reported to the appropriate law enforcement authorities. Section 353.3(d)(2) exempts an FDIC-supervised institution from filing a SAR for lost, missing, counterfeit, or stolen securities if the institution files a report pursuant to the reporting requirements of 17 CFR 240.17f-1. The proposed rule would add three paragraphs to § 353.3(d).

The proposed paragraph (d)(3) would permit the FDIC to exempt any FDIC-supervised institution from the requirements of 12 CFR 353.3. Upon receiving a written request from an FDIC-supervised institution, the FDIC would determine whether the exemption is consistent with safe and sound banking. The FDIC would also seek FinCEN's determination whether the exemption is consistent with the purposes of the BSA, as applicable, where an exemption request also requires an exemption from FinCEN's SAR regulation. The exemptions may be conditional or unconditional, may apply to particular persons or to classes of persons, and may apply to transactions or classes of transactions.

The proposed paragraph (d)(3) would require the FDIC to seek FinCEN's concurrence regarding an exemption request that also requires an exemption from FinCEN's SAR regulation. The proposed paragraph (d)(3) would permit the FDIC to consult with FinCEN regarding other exemption requests. The FDIC may also consult with the other state and federal banking agencies before granting any exemption.

The proposed paragraph (d)(4) would require that, after the FDIC has received FinCEN's concurrence and consulted with appropriate agencies, the FDIC provide a written response to the FDIC-supervised institution that submitted the exemption request. An FDIC-supervised institution that has received an exemption under paragraph (d)(3) may rely on the exemption for a period of time to be communicated by the FDIC in its granting of the exemption, which may be indefinite.

The proposed paragraph (d)(5) would permit the FDIC to revoke or extend the period of time for an exemption granted under paragraph (d)(3). Under the proposed paragraph (d)(5), the FDIC would have discretion to revoke exemptions. The proposed paragraph (d)(5) would require the FDIC to provide written notice to the FDIC-supervised institution of the FDIC's intention to revoke an exemption. The proposed paragraph (d)(5) would require the written notice to include the basis for the revocation and provide the FDIC-supervised institution an opportunity to respond. The proposed paragraph (d)(5) would require the FDIC to consider the institution's response before deciding to revoke an exemption. The proposed paragraph (d)(5) would require the FDIC to notify, in writing, the FDIC-supervised institution of the FDIC's final decision to revoke an exemption.

If the proposal is finalized, 12 CFR 353.3(d) would be amended to add paragraphs (d)(3) through (5), and would apply to all FDIC-supervised institutions. These initiatives would permit the FDIC to grant SAR exemptions to FDIC-supervised institutions to promote innovation, reduce burden, and meet BSA requirements more efficiently and effectively.

As explained previously, the proposed rule would amend 12 CFR 353.3(d) to add paragraphs (d)(3) through (5), and would apply to all FDIC-supervised institutions. As of June 30, 2020, the FDIC supervised 3,270 institutions. 11 The proposal would permit the FDIC to grant relief to FDIC-supervised institutions that leverage existing or future technologies to gather and submit the information contained in SARs to the appropriate law enforcement authorities and regulatory agencies in a more efficient and cost effective manner. This change would more closely align the FDIC's regulations with those of FinCEN, which has broad statutory authority to issue exemptions from SAR filing requirements. Because the FDIC's SAR regulations do not currently contain any provision by which the FDIC can issue case-by-case exemptions, a situation could arise in which FinCEN grants an exemption from SAR filing requirements to an FDIC-supervised institution that has developed innovative methods for meeting SAR filing requirements, but the institution would still need to file a SAR. The proposed rule would allow the FDIC to grant exemptions from SAR filing requirements in conjunction with FinCEN to reduce potential regulatory burden.

The FDIC does not have the ability to forecast the number of requests for exemptions that FDIC-supervised institutions will file as a result of this rule, or the number of requests that the FDIC will grant. The proposed rule is likely to pose some increase in compliance costs associated with submitting an exemption request to the FDIC, however the FDIC believes that the costs are likely to be small. The FDIC expects this proposed rule will result in cost savings for FDIC-supervised institutions that obtain exemptions from SAR filing requirements. However, the cost savings are projected to be relatively modest. For example, using the methodology for calculating the cost associated with filing SARs that FinCEN published in May 2020, 12 the FDIC estimates that FDIC-supervised institutions incurred roughly $3.8 million  13 in costs in the second quarter of 2020 related to reviewing alerts, and drafting, writing, submitting, and storing SAR filings and documentation, which amounts to annual estimated costs of $15.2 million for FDIC-supervised institutions in aggregate.

The FDIC estimated the recordkeeping, reporting, and disclosure costs of filing SARs for each FDIC-supervised institution in the second quarter of 2020 using data on SAR filings for each institution in combination with FinCEN's methodology for estimating costs associated with SAR filings. 14 The annualized estimated recordkeeping, reporting, and disclosure costs of filing SARs in the second quarter of 2020 do not represent more than 1.9 percent of annual non-interest expense for any FDIC-supervised institution. Additionally, only one FDIC-supervised institution incurred estimated annualized recordkeeping, reporting, and disclosure costs associated with SAR filing that amounted to more than 5 percent of annual wage and salary expense with the costs equaling 5.2 percent. 15 Therefore, the economic benefit of this proposed rule on FDIC-supervised institutions is likely to be relatively small. Further, this proposed rule would only allow the FDIC to grant exemptions in instances where safety and soundness and Bank Secrecy Act regulatory requirements would not be compromised, so the proposed rule is also not expected to have any broader negative economic impacts.

The FDIC invites comments on all aspects of this analysis. In particular, would the proposed rule have any costs or benefits to covered entities that the FDIC has not identified?

The FDIC has considered alternatives to the proposed rule but believes that the proposed amendments represent the most appropriate option for covered institutions. As discussed earlier, FinCEN has statutory authority to grant relief from SAR filing requirements to FDIC-supervised institutions, and this proposed rule would amend the FDIC's regulations so that the FDIC may issue exemptions to SAR filing requirements in conjunction with FinCEN. This change could reduce regulatory burden for FDIC-supervised institutions by allowing institutions that develop innovative techniques for meeting BSA requirements to obtain exemptions from SAR filing requirements. The FDIC considered maintaining its regulations in their current form, but chose not to do so because the FDIC believes that doing so would be unnecessarily burdensome and may discourage institutions from developing innovative approaches to meeting BSA requirements.

The FDIC invites comments on all aspects of this proposed rulemaking. In particular, the FDIC requests comments on the following questions:

Question 1. The FDIC invites comments on the proposed exemptions to 12 CFR 353.3 .

Question 2. The FDIC invites comments on whether any additional detail relating to the procedures that would be followed in considering, granting, or revoking exemptions are necessary .

Written comments must be received by the FDIC no later than February 22, 2021.

Certain provisions of the proposed rule contain “collection of information” requirements within the meaning of the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501-3521). In accordance with the requirements of the PRA, the FDIC may not conduct or sponsor, and the respondent is not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (OMB) control number. The information collection requirements contained in this notice of proposed rulemaking have been submitted to OMB for review and approval by FDIC under section 3507(d) of the PRA and § 1320.11 of OMB's implementing regulations (5 CFR part 1320) as a new information collection. The proposed rule contains voluntary reporting requirements, or exemption requests, in 12 CFR 353.3(d)(3).

Title of Proposed Information Collection: Exemptions to Suspicious Activity Report Requirements.

OMB Control Number: 3064—[NEW].

Frequency of Response: On Occasion.

Affected Public: Businesses or other for-profit.

Respondents: Any FDIC-supervised institution wishing to obtain an exemption from the Suspicious Activity Report requirements.

Estimated Number of Annual Respondents: 3.

Estimated Burden per Response: 8 hours.

Total estimated annual burden: 24 hours.

To derive these estimates, the FDIC assumed that the FDIC-supervised institutions that file the most SARs will be the most likely to request exemptions from SAR filing requirements. There are ten FDIC-supervised institutions that filed 1,000 or more SARs in the second quarter of 2020. The FDIC expects roughly one-third of those institutions to request an exemption per year, so the FDIC expects 3 annual respondents to this information collection. The FDIC estimates the hourly burden of an exemption request to be 8 hours.

Comments are invited on: (a) Whether the collection of information is necessary for the proper performance of the FDIC's functions, including whether the information has practical utility; (b) the accuracy of the estimates of the burden of the information collection, including the validity of the methodology and assumptions used; (c) ways to enhance the quality, utility, and clarity of the information to be collected; (d) ways to minimize the burden of the information collection on respondents, including through the use of automated collection techniques or other forms of information technology; and (e) estimates of capital or start-up costs and costs of operation, maintenance, and purchase of services to provide information.

All comments will become a matter of public record. Comments on aspects of this notice that may affect reporting or recordkeeping requirements and burden estimates should be sent to the addresses listed in the ADDRESSES section of this preamble. A copy of the comments may also be submitted to the FDIC OMB desk officer by mail to U.S. Office of Management and Budget, 725 17th Street NW, #10235, Washington, DC 20503 or by facsimile to 202-395-5806, Attention, Federal Banking Agency Desk Officer.

The Regulatory Flexibility Act (RFA), requires that, in connection with a notice of proposed rulemaking, an agency prepare and make available for public comment an initial regulatory flexibility analysis that describes the impact of the proposed rule on small entities. 16 However, a regulatory flexibility analysis is not required if the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities, and publishes its certification and a short explanatory statement in the Federal Register together with the rule. The Small Business Administration (SBA) has defined “small entities” to include banking organizations with total assets of less than or equal to $600 million. 17 Generally, the FDIC considers a significant effect to be a quantified effect in excess of 5 percent of total annual salaries and benefits per institution, or 2.5 percent of total noninterest expenses. The FDIC believes that effects in excess of these thresholds typically represent significant effects for FDIC-supervised institutions. For the reasons provided below, the FDIC certifies that the proposed rule would not have a significant economic impact on a substantial number of small banking organizations. Accordingly, a regulatory flexibility analysis is not required.

As of June 30, 2020, the FDIC supervised 3,270 institutions, 18 of which 2,492 are considered small entities for the purposes of RFA. 19 Using the methodology for calculating the cost associated with filing SARs that FinCEN published in May 2020, 20 the FDIC estimates that small FDIC-supervised institutions incurred $460,565.08  21 in costs in the second quarter of 2020 related to reviewing alerts, documenting the reasons why certain alerts do not merit a SAR filing, and drafting, writing, submitting, and storing SAR filings and documentation, which amounts to annual estimated costs of $1,842,260.32 for small FDIC-supervised institutions in aggregate.

The FDIC estimated costs of filing SARs for each FDIC-supervised institution in the second quarter of 2020 using data on SAR filings for each institution in combination with FinCEN's methodology for estimating costs associated with SAR filings. 22 The annualized estimated recordkeeping, reporting, and disclosure costs of filing SARs in the second quarter of 2020 do not represent more than 1.9 percent of annual non-interest expense for any small FDIC-supervised institution. Additionally, only one small FDIC-supervised institution incurred estimated annualized costs associated with SAR filing that amounted to more than 5 percent of annual wage and salary expense with the costs equaling 5.2 percent. 23 While the total estimated costs of filing SARs represent a significant expense for one FDIC-supervised small entity, the costs do not represent a significant amount for all other FDIC-supervised small entities. Thus, the cost savings from this proposal for all other FDIC-supervised small entities will likely not be significant. In addition, the cost savings from receiving a SAR exemption would be at least partially offset by the costs associated with requesting an exemption and the costs associated with developing a method for meeting SAR requirements. Further, this proposed rule would only allow the FDIC to grant exemptions in instances where safety and soundness and BSA regulatory requirements would not be compromised, so the proposed rule is also not expected to have any broader negative economic impacts.

Based on the information above, the FDIC certifies that the rule would not have a significant economic impact on a substantial number of small entities.

The FDIC invites comments on all aspects of the supporting information provided in this section, and in particular, whether the proposed rule would have any significant effects on small entities that the FDIC has not identified.

Section 722 of the Gramm-Leach-Bliley Act  24 requires the federal banking agencies to use plain language in all proposed and final rules published after January 1, 2000. The FDIC has sought to present the proposed rule in a simple and straightforward manner. The FDIC invites comments on whether the proposal is clearly stated and effectively organized, and how the FDIC might make the proposal easier to understand.

Under section 2222 of the Economic Growth and Regulatory Paperwork Reduction Act of 1996 (EGRPRA), the FDIC is required to review all of its regulations, at least once every 10 years, in order to identify any outdated or otherwise unnecessary regulations imposed on insured institutions. 25 The FDIC, along with the other federal banking agencies, submitted a Joint Report to Congress on March 21, 2017 (EGRPRA Report) discussing how the review was conducted, what has been done to date to address regulatory burden, and further measures the FDIC will take to address issues that were identified. 26 By providing the ability to issue exemptions and reduce burdens on FDIC-supervised institutions, this rule complements other actions that the FDIC has taken, separately and with the other federal banking agencies, to further the EGRPRA mandate.

Pursuant to section 302(a) of the Riegle Community Development and Regulatory Improvement Act (RCDRIA), 27 in determining the effective date and administrative compliance requirements for new regulations that impose additional reporting, disclosure, or other requirements on insured depository institutions (IDIs), each federal banking agency must consider, consistent with principles of safety and soundness and the public interest, any administrative burdens that the regulations would place on depository institutions, including small depository institutions, and customers of depository institutions, as well as the benefits of the regulations. In addition, section 302(b) of RCDRIA requires new regulations and amendments to regulations that impose additional reporting, disclosures, or other new requirements on IDIs generally to take effect on the first day of a calendar quarter that begins on or after the date on which the regulations are published in final form. 28 The FDIC invites comments that further will inform its consideration of RCDRIA.

For the reasons stated in the preamble, the Federal Deposit Insurance Corporation proposes to amend 12 CFR part 353 as follows:

Requirements related to SARs are codified in 12 CFR 748.1(c). This section of the NCUA's regulations requires FICUs to file SARs under certain conditions. In addition, this section provides for: (i) Board of director or other committee notification; (ii) filing exceptions; (iii) SAR confidentiality; (iv) recordkeeping requirements; (v) supporting documentation requirements; and (vi) limitations on liability. The proposed rule would allow the NCUA to issue exemptions from the regulation's SAR requirements.

The NCUA's original SARs regulation required FICUs to report potential violations of law arising from transactions that flow through those institutions. 1 As discussed in more detail later in this document, this regulation has been amended and updated since its inception. The NCUA's purpose for the regulation has, however, remained unchanged because fraud, abusive insider transactions, check-kiting schemes, money laundering, and other financial crimes can pose serious threats to a financial institution's continued viability and, if unchecked, can undermine the public confidence in the nation's financial services industry generally. 2

In 1992, Congress passed the Annunzio-Wylie Anti-Money Laundering Act (the Anti-Money Laundering Act), which redesigned the criminal referral process applicable to credit unions and made the reporting of certain suspicious transactions a requirement of the BSA. 3 The Anti-Money Laundering Act permitted the Department of the Treasury to require financial institutions, including credit unions, to “report any suspicious transaction relevant to a possible violation of law or regulation.”  4 Thereafter, the Department of the Treasury, in consultation with the NCUA, the other federal banking agencies, 5 and law enforcement developed the modern SAR form and reporting process, which standardized the reporting forms and created a centralized database that could be accessed by multiple law enforcement and regulatory agencies.

To implement this new reporting system, in 1996, the Financial Crimes Enforcement Network of the Department of the Treasury (FinCEN) issued its implementing SAR regulations for financial institutions subject to the requirements of the BSA to, among other things, specifically address the reporting of money laundering transactions and transactions designed to evade the reporting requirements of the BSA. 6 To further implement this new reporting process and reduce unnecessary reporting burdens, the NCUA and the other federal banking agencies contemporaneously amended their criminal referral form regulations to incorporate the new SAR form and reporting database, align their regulatory reporting requirements with FinCEN's BSA reporting requirements, and further refine the reporting processes. 7

As a result of this redesign and FinCEN's implementing regulations, FICUs are currently required to file SARs under both NCUA and FinCEN regulations. These regulations are not identical but are substantially similar with regard to the specified BSA reporting obligations required by FinCEN. Both the NCUA's and FinCEN's SAR regulations, among other things, require FICUs to file SARs relating to money laundering and transactions that are designed to evade the reporting requirements of the BSA  8 Furthermore, with respect to the SAR confidentiality requirements in the BSA, both the NCUA's and FinCEN's SAR regulations require FICUs to maintain the confidentiality of a SAR, and any information that would reveal the existence of the SAR, outside of certain circumstances. 9

However, the NCUA's and the other federal banking agencies' regulations cover a slightly broader range of transactions ( e.g., insider abuse at any dollar amount). 10

The NCUA and FinCEN SAR regulations also provide: (i) That SARs are not required for a robbery or burglary committed or attempted that is reported to appropriate law enforcement authorities; (ii) that SARs are confidential and shall not be disclosed except as authorized; (iii) recordkeeping requirements for SARs and supporting documentation; (iv) that supporting documentation shall be deemed to have been filed with the SAR; and (v) that supporting documentation shall be made available to appropriate law enforcement agencies upon request. The NCUA and FinCEN SAR regulations also provide a safe harbor from liability to any FICU and any of its officials, employees, or agents that make a voluntary disclosure of any possible violation of law or regulation to a government agency or file a SAR pursuant to the regulations or any other authority. The NCUA's regulation also contains a provision requiring that FICUs promptly notify their board of directors or committee designated by the board of directors to receive such notifications when a SAR has been filed.

FinCEN has general authority to grant exemptions from the requirements of the BSA, which includes granting exemptions under its SAR reporting regulations. 11 FinCEN's regulation provides that “[t]he Secretary [of Treasury], in his sole discretion, may by written order or authorization make exceptions to or grant exemptions from the requirements of [the BSA]. Such exemptions may be conditional or unconditional, may apply to particular persons or to classes of persons, and may apply to transactions or classes of transactions.” The Secretary has delegated this exemption authority to FinCEN. 12

As financial technology and innovation continue to develop in the area of monitoring and reporting financial crime and terrorist financing, the NCUA will need the express regulatory flexibility to grant exemptive relief when appropriate in this area on a consistent basis. In 2018, the NCUA, FinCEN, and the other federal banking agencies issued a statement encouraging financial institutions to take innovative approaches to meet their BSA/anti-money laundering (BSA/AML) compliance obligations. 13 That statement explained that financial institutions are encouraged to consider, evaluate, and where appropriate, responsibly implement innovative approaches in this area. Today, innovative approaches and technological developments in the areas of SAR monitoring, investigation and filings may involve, among other things: (i) Automated form population using natural language processing, transaction data, and customer due diligence information; (ii) automated or limited investigation processes depending on the complexity and risk of a particular transaction and appropriate safeguards; and (iii) enhanced monitoring processes using more and better data, optical scanning, artificial intelligence, or machine learning capabilities. Requests for exemptive relief pertaining to innovation or other matters may involve, among other things, expanded investigations and SAR timing issues, SAR disclosures and sharing, continued SAR filings for ongoing activity, SAR outsourcing of responsibilities and practices, the role of agents of FICUs, the use of shared utilities and shared data, and the use and sharing of de-identified data. The NCUA expects that new technologies will continue to prompt additional innovative approaches related to SAR filing and monitoring.

It is important to recognize that any NCUA-issued exemptions from its SAR regulation would not relieve the FICU from independent obligation to comply with FinCEN's SAR regulations, if applicable. To the extent an exemption request from a FICU involves both the NCUA's SAR regulation and FinCEN's SAR regulation, the FICU would need an exemption from both the NCUA and FinCEN. The NCUA expects to coordinate with FinCEN when handling parallel exemptions. As explained above, however, the NCUA's SAR regulation imposes additional requirements not included in FinCEN's SAR regulation. To the extent an exemption request is subject to a requirement imposed by the NCUA's SAR regulation alone (and not a parallel FinCEN requirement), the proposed rule would allow the NCUA to exempt a FICU from that requirement.

This proposed rule would allow the NCUA to issue exemptions from the requirements of its SAR regulation. Specifically, the proposed rule would add a provision to 12 CFR 748.1 that would provide that the NCUA may exempt a FICU from the requirements of that section. Under the proposed rule, the NCUA would determine whether the exemption is consistent with the purposes of the BSA, if applicable, and with safe and sound practices, and may consider other appropriate factors. The NCUA would also seek FinCEN's determination on whether the exemption would be consistent with the purposes of the BSA. The exemptions may be conditional or unconditional, may apply to particular persons or to classes of persons, and may apply to transactions or classes of transactions.

In addition, this proposal would require the NCUA to seek FinCEN's concurrence regarding any exemption requests that involve an exemption from the requirement to file a SAR required by FinCEN regulations implementing the BSA. The proposal would also permit the NCUA to consult with FinCEN regarding other exemption requests. The NCUA may also consult with the other state and federal banking agencies before granting any exemption.

Finally, the proposed rule provides that the NCUA may grant an exemption for a specified time period. Under the proposed rule, the NCUA could also revoke previously granted exemptions if circumstances change related to the factors set out above (consistency with the BSA and safety and soundness) or any imposed conditions.

If the NCUA adopts this proposed rule and uses it to grant exemptions, such exemptions would not relieve a FICU from the obligation to comply with FinCEN's SAR regulation, if applicable. To the extent a FICU is subject to requirements imposed by both the NCUA's SAR regulation and FinCEN's SAR regulation, the FICU would need to seek an exemption from both the NCUA and FinCEN. As explained above, however, the NCUA's SAR regulation imposes additional requirements not included in FinCEN's regulation. To the extent a FICU is subject to a requirement imposed by the NCUA's SAR regulation alone (and not a parallel FinCEN requirement), the proposed rule would allow the NCUA to exempt a FICU from that requirement.

The Board is providing for a 30-day comment period instead of a 60-day comment period because the proposed rule is limited in scope, and the Board believes that 30 days will provide the public adequate time to review and comment on it. 14

The Board invites comments on the proposed rule, including whether any additional detail relating to the procedures that would be followed in considering, granting or revoking exemptions is necessary. The Board is also specifically requesting comments on whether additional or different factors or standards should be applied in the determination whether to grant an exemption request, as well as the form and manner of the Board's response to an exemption request.

The Regulatory Flexibility Act (RFA) generally requires that, in connection with a notice of proposed rulemaking, an agency prepare and make available for public comment an initial regulatory flexibility analysis that describes the impact of a proposed rule on small entities (defined for purposes of the RFA to include credit unions with assets less than $100 million). 15 A regulatory flexibility analysis is not required, however, if the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities and publishes its certification and a short, explanatory statement in the Federal Register together with the rule.

The proposed rule would allow FICUs to request exemptions from certain regulatory requirements if they choose to do so. As a result, it would not cause any increased burden or impose any new requirements on FICUs. Accordingly, the NCUA certifies that the proposed rule would not have a significant economic impact on a substantial number of small credit unions.

The Paperwork Reduction Act of 1995 (PRA) applies to information collection requirements in which an agency creates a new paperwork burden on regulated entities or modifies an existing burden. For purposes of the PRA, a paperwork burden may take the form of a reporting, recordkeeping, or third-party disclosure requirement, each referred to as an information collection. The NCUA may not conduct or sponsor, and the respondent is not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (OMB) control number.

This proposed rule adds a provision to § 748.1(c) that would allow FICUs to submit a written request to NCUA if it wishes to seek an exemption from the requirements of this section. There are 2,932 FICUs that currently file SARs annually. It is estimated that 50 of these FICUs would file for an exemption under the proposed new § 748.1(c)(7); taking 2 hours per response, for a total increase of 100 burden hours. This proposed rule would revise the information collection requirement currently approved under OMB number 3133-0094, as follows:

Title of Information Collection: Suspicious Activity Report by Depository Institutions.

OMB Control Number: 3133-0094.

Estimated Number of Respondents: 2,932.

Estimated Annual Frequency of Response: 65.

Estimated Total Annual Reponses: 191,069.

Estimated Hours per Response: 1.

Estimated Total Annual Burden Hours: 191,119.

Affected Public: Private Sector: Not-for-profit institutions.

The NCUA invites comments on: (a) Whether the collections of information are necessary for the proper performance of the agencies' functions, including whether the information has practical utility; (b) the accuracy of the estimates of the burden of the information collections, including the validity of the methodology and assumptions used; (c) ways to enhance the quality, utility, and clarity of the information to be collected; (d) ways to minimize the burden of the information collections on respondents, including through the use of automated collection techniques or other forms of information technology; and (e) estimates of capital or start-up costs and costs of operation, maintenance, and purchase of services to provide information.

All comments are a matter of public record. Due to the limited in-house staff, email comments are preferred. Comments regarding the information collection requirements of this rule should be (1) emailed to: PRAcomments@ncua.gov with “OMB No. 3133-0094” in the subject line; faxed to 703-837-2406, or mailed to Mackie Malaka, NCUA PRA Clearance Officer, National Credit Union Administration, 1775 Duke Street, Suite 5080, Alexandria, Virginia 22314 and to the (2) Office of Information and Regulatory Affairs, Office of Management and Budget, at www.reginfo.gov/public/do/PRAMain . Select “Currently under 30-day Review—Open for Public Comments” or by using the search function.

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

The NCUA has determined that this proposed rule will not affect family well-being within the meaning of section 654 of the Treasury and General Government Appropriations Act, 1999, Public Law 105-277, 112 Stat. 2681 (1998).

For the reasons discussed in the preamble, the Board proposes to amend 12 CFR part 748, as follows:

EPA is proposing to approve changes to Regulation 6.21, Standard of Performance for Existing Gasoline Loading Facilities at Bulk Terminals, and Regulation 7.20, Standard of Performance for New Gasoline Loading Facilities at Bulk Plants, of the Jefferson County portion of the Kentucky SIP, submitted by the Commonwealth of Kentucky on September 5, 2019. The amendments replace the requirement for tank trucks being loaded at bulk terminals and plants to possess a valid Kentucky pressure vacuum sticker with specific vapor tightness testing and recordkeeping requirements and make minor, non-substantive changes as discussed in section II. The SIP revisions update the current SIP-approved versions of Regulation 6.21 (Version 2) and Regulation 7.20 (Version 2) to Version 3.

The District's September 5, 2019, SIP revision includes changes to Regulation 6.21 and Regulation 7.20 related to standards for existing gasoline loading facilities at bulk terminals and standards for new gasoline loading facilities at bulk plants, respectively, as described below. The District notes that it enacted these regulations to control volatile organic compound emissions from gasoline loading facilities and that Regulations Parts 6 and 7 apply more stringent standards to a broader cross-section of sources than the federal New Source Performance Standards (NSPS). 1

The District has revised Regulation 6.21 and Regulation 7.20 to discontinue the practice of requiring gasoline transport vehicles to display a Kentucky pressure vacuum sticker. Specifically, the revisions to Regulation 6.20 and Regulation 7.21 delete the text of subsection 3.6.4 and subsection 3.11.1, respectively, which provide that no owner or operator of a bulk gasoline terminal or plant subject to these regulations may allow a tank truck or trailer to be loaded with gasoline unless the vehicle has “a valid Kentucky pressure-vacuum test sticker as required by Regulation 6.37 attached and visibly displayed.”  2 This requirement is replaced with specific procedures for assuring that tank trucks and their associated vapor collection systems have passed the required vapor tightness test on an annual basis. New subsection 3.6.4.1 of Regulation 6.21 and subsection 3.11.1.1 of Regulation 7.20 state that no owner or operator of an existing bulk gasoline terminal or a new bulk gasoline plant shall allow loading unless the gasoline tank truck and its vapor collection system has demonstrated a pressure change within specific parameters. The parameters to be met are a pressure change of no more than 75 millimeter (mm) water (3 inches water) in five minutes when pressurized to 450 mm water (18 inches water) and when evacuated to 150 mm water (6 inches water) using the test procedure described in the regulation.

The SIP revision also adds a new subsection 3.6.4.2 of Regulation 6.21 and a new subsection 3.11.1.2 of Regulation 7.20 to specify the testing procedures that must be used to assure compliance with the new vapor tightness requirements described above. As proposed for incorporation into the SIP, these subsections require that EPA Method 27, “Determination of Vapor Tightness of Gasoline Delivery Tank Using Pressure Vacuum Test,” as specified in 40 CFR 60, Appendix A, on July 1, 1991, shall be used to determine compliance with subsection 3.6.4.1 of Regulation 6.21 and subsection 3.11.1.1 of Regulation 7.20. 3 The new subsections also require the owner or operator of a tank truck being loaded at an affected facility to have this vapor tightness test completed annually and to maintain all testing records ( i.e., test data, date of testing, identification of tank truck, type of repair, retest data and date) for two years after the date of testing, and to make such records available upon request by the District. EPA notes that the District's revised tank truck vapor tightness standards, testing procedures and recordkeeping requirements as proposed for incorporation into the SIP are consistent with the Commonwealth of Kentucky's requirements at 401 KAR 63:031, Leaks from gasoline tank trucks, and also with EPA's requirements applicable to gasoline cargo tanks under 40 CFR part 60, subpart XX, Standards of Performance for Bulk Gasoline Terminals ( see 40 CFR 60.505(b)) and 40 CFR part 63, subpart BBBBBB, National Emission Standards for Hazardous Air Pollutants for Source Category: Gasoline Distribution Bulk Terminals, Bulk Plants, and Pipeline Facilities ( see 40 CFR 63.11092(f)(1) and 63.11094(b)).

The revisions also include minor changes Regulation 6.21 and Regulation 7.20. A non-substantive change to Section 1 of Regulation 6.21 clarifies that the rule applies to each affected facility that was either existing or had a construction permit issued on or before June 13, 1979. 4 The non-substantive changes to Regulation 7.20 clarify that the rule applies to each affected facility which commenced construction, modification, or reconstruction after June 13, 1979;  5 remove language in subsection 3.11.3 such that a pressure measuring device is no longer required to be supplied by the District; and renumber subsections within Section 3.

Because these rule revisions will not increase air pollutant emissions, EPA proposes to determine that, in accordance with CAA section 110(l), that they will not interfere with attainment or maintenance of the NAAQS, reasonable further progress toward attainment of the NAAQS, or any other applicable requirement of the CAA. EPA has preliminarily determined that these changes are consistent with the CAA is therefore proposing to approve these portions of the SIP revisions.

In this document, EPA is proposing to include in a final EPA rule regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, EPA is proposing to incorporate by reference Louisville Metro Air Pollution Control District Regulation 6.21, Standard of Performance for Existing Gasoline Loading Facilities at Bulk Terminals, Version 3, and Regulation 7.20, Standard of Performance for New Gasoline Loading Facilities at Bulk Plants, Version 3, state-effective June 19, 2019, with the exception of the phrase “or an alternate procedure approved by the District” in Regulation 6.21, subsection 3.6.4.2 and Regulation 7.20, subsection 3.11.1.2. The changes to these rules replace a requirement for gasoline tank trucks to possess valid pressure vacuum test sticker with a requirement for specific vapor tightness testing and recordkeeping procedures, clarify rule applicability, and remove language stating that a pressure measuring device will be supplied by the District. EPA has made, and will continue to make, these materials generally available through www.regulations.gov and at the EPA Region 4 office (please contact the person identified in the For Further Information Contact section of this preamble for more information).

EPA is proposing to approve the revisions to the Jefferson County portion of the Kentucky SIP (Regulation 6.21, Standard of Performance for Existing Gasoline Loading Facilities at Bulk Terminals, Version 3, and Regulation 7.20, Standard of Performance for New Gasoline Loading Facilities at Bulk Plants, Version 3), submitted on September 5, 2019, as discussed above.

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

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

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

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

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

• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1955 (Pub. L. 104-4);

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

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

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

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

• Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994). The SIP is not approved to apply on any Indian reservation land or any other area where EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), nor will it impose substantial direct costs on tribal governments or preempt tribal law.

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

Maine's Infrastructure SIP for the 2015 ozone standard.

On October 1, 2015, EPA promulgated a revision to the ozone NAAQS (2015 ozone NAAQS), lowering the level of both the primary and secondary standards to 0.070 parts per million (ppm). 1 Section 110(a)(1) of the CAA requires states to submit, within 3 years after promulgation of a new or revised standard, SIPs meeting the applicable requirements of section 110(a)(2). 2 On February 14, 2020, the Maine Department of Environmental Protection (Maine DEP) submitted a revision to the Maine State Implementation Plan (SIP). The SIP revision addresses the infrastructure requirements of CAA sections 110(a)(1) and 110(a)(2) for the 2015 ozone NAAQS.

Maine's Negative declaration for the Oil and Natural Gas Industry for the 2008 and 2015 ozone standards.

On October 27, 2016, EPA published in the Federal Register the “Final Control Techniques Guidelines for the Oil and Natural Gas Industry.” See 81 FR 74798. The CTG provided information to state, local, and tribal air agencies to assist them in determining reasonably available control technology (RACT) for volatile organic compound (VOC) emissions from select oil and natural gas industry emission sources. CAA section 182(b)(2)(A) requires that, for ozone nonattainment areas classified as Moderate or above, states must revise their SIPs to include provisions to implement RACT for each category of VOC sources covered by a CTG document. CAA section 184(b)(1)(B) extends the RACT obligation to all areas of states within the Ozone Transport Region (OTR). Pursuant to CAA section 184(a), Maine is a member state of the OTR. States subject to RACT requirements are required to adopt controls that are at least as stringent as those found in the CTG either by adopting regulations or issuing single-source Orders or Permits that outline what the source is required to do to meet RACT. If no source for a specified CTG exists in a state, the state must submit, as a SIP revision, a negative declaration documenting this fact. On May 18, 2020, Maine DEP submitted for approval into the Maine SIP, a negative declaration for the 2016 CTG for the Oil and Natural Gas Industry for the 2008 and 2015 ozone standards.

EPA is proposing to approve SIP revisions submitted by Maine on February 14, 2020, addressing the infrastructure requirements of CAA sections 110(a)(1) and 110(a)(2) for the 2015 ozone NAAQS, except the transport provisions which will be addressed in a future action. Additionally, we are proposing to approve a regulation (ambient air quality standards) submitted by Maine on May 28, 2019, and a statute (conflict- of-interest provisions) submitted by Maine on September 4, 2019, which support the infrastructure SIP submittal. Finally, EPA is proposing to approve a SIP revision submitted by Maine on May 18, 2020, that provides the state's determination, via a negative declaration, that there are no facilities within its borders subject to EPA's 2016 CTG for the oil and gas industry for the 2008 and 2015 ozone standards.

Regarding the 2015 ozone infrastructure SIP submission, whenever EPA promulgates a new or revised NAAQS, CAA section 110(a)(1) requires states to make “infrastructure SIP submissions” to provide for the implementation, maintenance, and enforcement of the NAAQS. These submissions must meet the various requirements of CAA section 110(a)(2), as applicable. Due to ambiguity in some of the language of CAA section 110(a)(2), EPA believes that it is appropriate to interpret these provisions in the specific context of acting on infrastructure SIP submissions. EPA has previously provided comprehensive guidance on the application of these provisions through a guidance document for infrastructure SIP submissions and through regional actions on infrastructure submissions. 3 Unless otherwise noted below, we are following that approach in acting on this submission. In addition, in the context of acting on such infrastructure submissions, EPA evaluates the submitting state's SIP for compliance with statutory and regulatory requirements, not for the state's implementation of its SIP. 4 EPA has other authority to address any issues concerning a state's implementation of the rules, regulations, consent orders, etc. that comprise its SIP.

EPA highlighted the statutory requirement to submit infrastructure SIPs within 3 years of promulgation of a new NAAQS in an October 2, 2007, guidance document entitled “Guidance on SIP Elements Required Under Sections 110(a)(1) and (2) for the 1997 8-hour Ozone and PM 2.5 National Ambient Air Quality Standards” (2007 memorandum). 5 EPA has issued additional guidance documents and memoranda, including a September 13, 2013, guidance document entitled “Guidance on Infrastructure State Implementation Plan (SIP) Elements under Clean Air Act Sections 110(a)(1) and 110(a)(2)” (2013 memorandum).

Maine's February 14, 2020, submission includes a detailed list of Maine Laws and SIP-approved Air Quality Regulations that show precisely how each component of its EPA-approved SIP meets the requirements of section 110(a)(2) of the CAA for the 2015 ozone NAAQS. The following review evaluates the state's submission in light of section 110(a)(2) requirements and relevant EPA guidance. For Maine's February 2020 infrastructure submission, we provide an evaluation of the applicable Section 110(a)(2) elements, excluding the transport provisions.

This section (also referred to in today's action as an element) of the Act requires SIPs to include enforceable emission limits and other control measures, means or techniques, schedules for compliance, and other related matters. However, EPA has long interpreted emission limits and control measures for attaining the standards as being due when nonattainment planning requirements are due. 6 In the context of an infrastructure SIP, EPA is not evaluating the existing SIP provisions for this purpose. Instead, EPA is only evaluating whether the state's SIP has basic structural provisions for the implementation of the NAAQS.

In its February 2020 submittal for the 2015 ozone NAAQS, Maine cites state laws and regulations in satisfaction of element A. Maine DEP statutory authority with respect to air quality is set out in 38 MRSA Chapter 4, “Protection and Improvement of Air.” Legislative authority giving DEP general authority to promulgate regulations is codified at 38 MRSA Chapter 2, Subchapter 1: “Organization and Powers.” Statutory authority to establish emission standards and regulations implementing ambient air quality standards is contained in 38 MRSA Chapter 4, sections 585 and 585-A.

Under element A of its February 14, 2020, infrastructure SIP submittal for the 2015 ozone NAAQS, the Maine DEP cites over 30 state regulations that it has adopted to control emissions related to ozone and the ozone precursors, nitrogen oxides (NO X ) and volatile organic compounds (VOCs). Some of these, with their EPA approval citation, 7 are listed here: 06-096 Code of Maine Regulations (CMR) Chapter 111 Petroleum Liquid Storage Vapor Control (79 FR 65587; November 5, 2014); Chapter 115 Emission License Regulations (81 FR 50353; August 1, 2016); Chapter 127 New Motor Vehicle Emission Standards (70 FR 21959; April 28, 2005); Chapter 129 Surface Coating facilities 77 FR 30216; May 22, 2012); Chapter 134 Reasonably Available Control Technology for Facilities that Emit Volatile Organic Compounds (65 FR 20749; April 18, 2000); Chapter 138 Reasonably Available Control Technology for Facilities that Emit Nitrogen Oxides (67 FR 57148; September 9, 2002); and Chapter 145 NO X Control Program (70 FR 11879; March 10, 2005).

On May 22, 2019, Maine submitted a SIP revision containing Maine's updated Chapter 110, “Ambient Air Quality Standards,” which was previously approved by EPA on June 24, 2014. See 79 FR 35695. The updates to Chapter 110 incorporate the current NAAQS for ozone and PM 2.5, and update and align the rules governing the Maine ambient air quality standards to provide consistency with the federal NAAQS. Therefore, EPA is proposing to approve updated Chapter 110 into the SIP. Consequently, we are also proposing to convert to full approval previous conditional approvals of section 110(a)(2)(A) for Maine's infrastructure SIPs for the 1997 and 2006 PM 2.5 NAAQS (October 16, 2012; 77 FR 63228).

EPA proposes that Maine meets the infrastructure requirements of section 110(a)(2)(A) for the 2015 ozone NAAQS.

This section requires SIPs to provide for establishment and operation of appropriate devices, methods, systems, and procedures necessary to monitor, compile, and analyze ambient air quality data, and to make these data available to EPA upon request. Each year, states submit annual air monitoring network plans to EPA for review and approval. EPA's review of these annual monitoring plans includes our evaluation of whether the state: (i) Monitors air quality at appropriate locations throughout the state using EPA-approved Federal Reference Methods or Federal Equivalent Method monitors; (ii) submits data to EPA's Air Quality System (AQS) in a timely manner; and (iii) provides EPA Regional Offices with prior notification of any planned changes to monitoring sites or the network plan.

Pursuant to authority granted to it by 38 Maine Revised Statutes Annotated (MRSA) §§ 341-A(1) and 584-A, Maine DEP operates an air quality monitoring network, and EPA approved the state's 2020 Annual Air Monitoring Network Plan for ozone on September 11, 2019. 8

Furthermore, DEP populates AQS with air quality monitoring data in a timely manner, and provides EPA with prior notification when considering a change to its monitoring network or plan. EPA proposes that Maine has met the infrastructure SIP requirements of section 110(a)(2)(B) with respect to the 2015 ozone NAAQS.

States are required to include a program providing for enforcement of all SIP measures and for the regulation of construction of new or modified stationary sources to meet new source review (NSR) requirements under prevention of significant deterioration (PSD) and nonattainment new source review (NNSR) programs. Part C of the CAA (sections 160-169B) addresses PSD, while part D of the CAA (sections 171-193) addresses NNSR requirements.

The evaluation of each state's submission addressing the infrastructure SIP requirements of section 110(a)(2)(C) covers the following: (i) Enforcement of SIP measures; (ii) PSD program for major sources and major modifications; and (iii) a permit program for minor sources and minor modifications.

Maine's authority for enforcing SIP measures is established in 38 MRSA Section 347-A, “Violations,” 38 MRSA Section 347-C, “Right of inspection and entry,” 38 MRSA Section 348, “Judicial Enforcement,” 38 MRSA Section 349, “Penalties,” and 06-096 CMR Chapter 115, “Major and Minor Source Air Emission License Regulations,” and includes processes for both civil and criminal enforcement actions. Construction of new or modified stationary sources in Maine is regulated by 06-096 CMR Chapter 115, “Major and Minor Source Air Emission License Regulations,” which requires best available control technology (BACT) controls for PSD sources, including the ozone precursors VOC and NO X . EPA proposes that Maine has met the enforcement of SIP measures requirements of section 110(a)(2)(C) with respect to the 2015 ozone NAAQS.

Prevention of significant deterioration (PSD) applies to new major sources or modifications made to major sources for pollutants where the area in which the source is located is in attainment of, or unclassifiable with regard to, the relevant NAAQS. EPA interprets the CAA as requiring each state to make an infrastructure SIP submission for a new or revised NAAQS demonstrating that the air agency has a complete PSD permitting program in place satisfying the current requirements for all regulated NSR pollutants.

Maine DEP's EPA-approved PSD rules, contained at 06-096 CMR Chapter 115, “Major and Minor Source Air Emission License Regulations,” contain provisions that address applicable requirements for all regulated NSR pollutants, including Greenhouse Gases (GHGs).

In determining whether a state has a comprehensive PSD permit program, EPA reviews the SIP to ensure that the air agency has a PSD permitting program meeting the current requirements for all regulated NSR pollutants, including the following EPA rules: The “Final Rule to Implement the 8-Hour Ozone National Ambient Air Quality Standard—Phase 2; Final Rule to Implement Certain Aspects of the 1990 Amendments Relating to New Source Review and Prevention of Significant Deterioration as They Apply in Carbon Monoxide, Particulate Matter, and Ozone NAAQS; Final Rule for Reformulated Gasoline” (the “Phase 2 Rule”), 70 FR 71612 (November 29, 2005); the “Implementation of the New Source Review (NSR) Program for Particulate Matter Less than 2.5 Micrometers (PM 2.5 )” (the “2008 NSR Rule”), 73 FR 28321 (May 16, 2008); and the “Prevention of Significant Deterioration (PSD) for Particulate Matter Less Than 2.5 Micrometers (PM 2.5 )—Increments, Significant Impact Levels (SILs) and Significant Monitoring Concentration (SMC)” (the “2010 NSR Rule”), 75 FR 64864 (October 20, 2010. In our proposal on March 26, 2018, regarding the submittal of infrastructure SIPS for the 2008 Pb, 2008 ozone, and 2010 NO 2 NAAQS by the Maine DEP, we explained how Maine's SIP meets the requirements of the Phase 2 Rule, the 2008 NSR Rule, and the 2010 NSR Rule. See 83 FR 12905. Based on our rationale contained in the March 26, 2018, notice, we propose to approve Maine's infrastructure SIP submittal with respect to the requirements of the Phase 2 Rule, the 2008 NSR Rule, and the 2010 NSR Rule.

We are proposing to approve Maine's February 2020 infrastructure submittal for this PSD sub-element of section 110(a)(2)(C) for the 2015 ozone NAAQS.

To address the pre-construction regulation of the modification and construction of minor stationary sources and minor modifications of major stationary sources, an infrastructure SIP submission should identify the existing EPA-approved SIP provisions and/or include new provisions that govern the minor source pre-construction program that regulate emissions of the relevant NAAQS pollutants.

EPA last approved revisions to Maine's minor NSR program on August 1, 2016 (81 FR 50353). Maine and EPA rely on the existing minor NSR program in 06-096 CMR Chapter 115 to ensure that new and modified sources not captured by the major NSR permitting programs do not interfere with attainment and maintenance of the 2015 ozone NAAQS.

We are proposing to find that Maine has met the requirement to have a SIP-approved minor new source review permit program as required under Section 110(a)(2)(C) for the 2015 ozone NAAQS.

One of the structural requirements of section 110(a)(2) is section 110(a)(2)(D)(i), also known as the “good neighbor” provisions, which generally requires SIPs to contain adequate provisions to prohibit in-state emissions activities from having certain adverse air quality effects on neighboring states due to interstate transport of air pollution.

In particular, section 110(a)(2)(D)(i)(I) requires SIPs to include provisions prohibiting any source or other type of emissions activity in one state from emitting any air pollutant in amounts that will contribute significantly to nonattainment, or interfere with maintenance, of the NAAQS in another state. EPA commonly refers to these requirements as Prong 1 (significant contribution to nonattainment) and Prong 2 (interference with maintenance). A state's SIP submission for Prongs 1 and 2 is also referred to as a state's “Transport SIP.” In today's action, EPA is not evaluating Maine's Transport SIP ( i.e., Prongs 1 and 2; combined as (D)1 in Table 1 below). EPA will address Maine's Transport SIP for the 2015 ozone NAAQS in a future action.

Today's action, however, does address Section 110(a)(2)(D)(i)(II), which requires SIPs to contain adequate provisions to prohibit emissions that will interfere with measures included in the applicable implementation plan for any other state under part C of the Act to prevent significant deterioration of air quality and to protect visibility. EPA commonly refers to these requirements as Prong 3 (Prevention of Significant Deterioration) and Prong 4 (Visibility Protection). Today's action also addresses Section 110(a)(2)(D)(ii) of the Act, which requires SIPs to contain provisions to ensure compliance with sections 126 and 115 of the Act relating to interstate and international pollution abatement, respectively.

To prevent significant deterioration of air quality, this sub-element requires SIPs to include provisions that prohibit any source or other type of emissions activity in one state from interfering with measures that are required in any other state's SIP under Part C of the CAA. As explained in the 2013 memorandum, 9 a state may meet this requirement with respect to in-state sources and pollutants that are subject to PSD permitting through a comprehensive PSD permitting program that applies to all regulated NSR pollutants and that satisfies the requirements of EPA's PSD implementation rules. Maine has a comprehensive PSD permitting program in place satisfying the current requirements for all regulated NSR pollutants, as explained above in the discussion of Section 110(a)(2)(C).

For in-state sources not subject to PSD, this requirement can be satisfied through a fully approved nonattainment new source review (NNSR) program with respect to any previous NAAQS. EPA approved revisions to Maine's NNSR regulations on February 14, 1996. See 61 FR 5690. These NNSR regulations contain provisions for how the state must treat and control sources in nonattainment areas, consistent with 40 CFR 51.165, or appendix S to 40 CFR part 51.

For these reasons, EPA proposes to approve Maine's submittal for the PSD requirements of 110(a)(2)(D)(i)(II) for the 2015 ozone NAAQS.

Prong 4 requires a state's SIP to have adequate provisions prohibiting emissions in amounts that will interfere with measures in other states' SIPs to protect visibility. The prong 4 requirement is closely connected to the regional haze program under part C of the CAA, in which states work together in a regional planning process to determine each state's contribution to the visibility impairment in that region and agree to emission reduction measures to improve visibility. Maine is a member of the Mid-Atlantic/North East Visibility Union. EPA regulations require that a state participating in a regional planning process include in its regional haze SIP all measures needed to achieve its apportionment of emission reduction obligations agreed upon through that process. See, e.g., 40 CFR 51.308(d)(3). Thus, a fully approved regional haze SIP meeting the requirements of 40 CFR 51.308 will ensure that emissions from sources under an air agency's jurisdiction are not interfering with measures required to be included in other air agencies' plans to protect visibility and will, therefore, satisfy Prong 4.

EPA approved Maine's Regional Haze SIP on April 24, 2012 (77 FR 24385). Accordingly, EPA proposes that Maine meets the visibility protection requirements of 110(a)(2)(D)(i)(II) for the 2015 ozone NAAQS.

This sub-element requires that each SIP contain provisions requiring compliance with requirements of CAA section 126 relating to interstate pollution abatement. Section 126(a) requires new or modified sources to notify neighboring states of potential impacts from the source. The statute does not specify the method by which the source should provide the notification. States with SIP-approved PSD programs must have a provision requiring such notification by new or modified sources.

EPA-approved regulations require the Maine DEP to provide pre-construction notice of new or modified sources to, among others, “any State . . . whose lands may be affected by emissions from the source or modification.” See 06-096 CMR Chapter 115, §  IX(E)(3); approved March 23, 1993 (58 FR 15422). Such notice “shall announce availability of the application, the Department's preliminary determination in the form of a draft order, the degree of increment consumption that is expected from the source or modification, as well as the opportunity for submission of written public comment.” See 06-096 CMR Chapter 115, §  IX(E)(2).

These public notice requirements are consistent with the Federal SIP-approved PSD program's public notice requirements for affected states under 40 CFR 51.166(q). Therefore, we propose to approve Maine's compliance with the infrastructure SIP requirements of CAA section 126(a) for the 2015 ozone NAAQS. Maine has no obligations under any other provision of CAA section 126, and no source or sources within the state are the subject of an active finding under section 126 with respect to the 2015 ozone NAAQS.

This sub-element also requires each SIP to contain provisions requiring compliance with the applicable requirements of CAA section 115 relating to international pollution abatement. Section 115 authorizes the Administrator to require a state to revise its SIP to alleviate international transport into another country where the Administrator has made a finding with respect to emissions of a NAAQS pollutant and its precursors, if applicable. There are no final findings under section 115 against Maine with respect to the 2015 ozone NAAQS. Therefore, EPA is proposing that Maine has met the applicable infrastructure SIP requirements of section 110(a)(2)(D)(ii) related to CAA section 115 for the 2015 ozone NAAQS.

Section 110(a)(2)(E)(i) requires each SIP to provide assurances that the state will have adequate personnel, funding, and legal authority under state law to carry out its SIP. In addition, section 110(a)(2)(E)(ii) requires each state to comply with the requirements for state boards in CAA section 128. Finally, section 110(a)(2)(E)(iii) requires that, where a state relies upon local or regional governments or agencies for the implementation of its SIP provisions, the state retain responsibility for ensuring implementation of SIP obligations with respect to relevant NAAQS. Section 110(a)(2)(E)(iii), however, does not apply to this action because Maine does not rely upon local or regional governments or agencies for the implementation of its SIP provisions.

Maine, through its infrastructure SIP submittal, has documented that its air agency has authority and resources to carry out its SIP obligations. Maine cites 38 MRSA §  341-A, “Department of Environmental Protection,” 38 MRSA §  341-D, “Board responsibilities and duties,” 38 MRSA §  342, “Commissioner, duties,” and 38 MRSA §  581, “Declaration of findings and intent.” These statutes provide the Maine DEP with the legal authority to enforce air pollution control requirements and carry out SIP obligations with respect to the 2015 ozone NAAQS. Additionally, state law provides the DEP with the authority to assess preconstruction permit fees and annual operating permit fees from air emissions sources and establishes a general revenue reserve account within the general fund to finance the state clean air programs. Maine also receives CAA sections 103 and 105 grant funds through Performance Partnership Grants along with required state-matching funds to provide funding necessary to carry out SIP requirements.

Maine states in its February 14, 2020, submittal for 2015 ozone NAAQS that the Bureau of Air Quality had a staff of 53 and a budget of $4.8 million for FY 2016. ME DEP staff and operations are funded by the State and through EPA grants, including annual funding through CAA sections 103 and 105 to assist with the costs of implementing programs for the prevention and control of air pollution or implementation of national primary and secondary ambient air quality standards. Maine also has an EPA-approved fee program under CAA title V which is used to support title V program elements such as permitting, monitoring, testing, inspections, and enforcement. Furthermore, ME DEP's budget has been consistent over the past number of years and over these years Maine has been able to meet its statutory commitments under the Act. 10 Based upon Maine's submittal and this additional information, EPA proposes that Maine meets the infrastructure SIP requirements of this sub-element of section 110(a)(2)(E) for the 2015 ozone NAAQS.

Section 110(a)(2)(E)(ii) requires each SIP to contain provisions that comply with the state board requirements of section 128(a) of the CAA. That provision contains two explicit requirements: (1) That any board or body which approves permits or enforcement orders under this chapter shall have at least a majority of members who represent the public interest and do not derive any significant portion of their income from persons subject to permits and enforcement orders under this chapter, and (2) that any potential conflicts of interest by members of such board or body or the head of an executive agency with similar powers be adequately disclosed. Section 128 further provides that a state may adopt more stringent conflicts of interest requirements and requires EPA to approve any such requirements submitted as part of a SIP.

Maine DEP consists of a Commissioner and a Board of Environmental Protection (“BEP” or “Board”), which is an independent authority under state law that reviews certain permit applications in the first instance and also renders final decisions on appeals of permitting actions taken by the Commissioner as well as some enforcement decisions by the Commissioner. Because the Board has authority under state law to hear appeals of some CAA permits and enforcement orders, EPA considers that the Board has authority to “approve” those permits or enforcement orders, as recommended in the 2013 Guidance at 42, and that the requirement of CAA § 128(a)(1) applies to Maine—that is, that “any board or body which approves permits or enforcement orders under this chapter shall have at least a majority of members who represent the public interest and do not derive any significant portion of their income from persons subject to permits and enforcement orders under this chapter.”

Pursuant to state law, the BEP consists of seven members appointed by the Governor, subject to confirmation by the State Legislature. See 38 MRSA § 341-C(1). The purpose of the Board “is to provide informed, independent and timely decisions on the interpretation, administration and enforcement of the laws relating to environmental protection and to provide for credible, fair and responsible public participation in department decisions.” Id. § 341-B. State law further provides that Board members “must be chosen to represent the broadest possible interest and experience that can be brought to bear on the administration and implementation of” Maine's environmental laws and that “[a]t least 3 members must have technical or scientific backgrounds in environmental issues and no more than 4 members may be residents of the same congressional district.” Id. § 341-C(2). As EPA has also explained in previous notices of proposed rulemakings related to Maine infrastructure SIP submittals, section 341-C fulfills the requirement that at least a majority of Board members represent the public interest, but it does not address the requirement that at least a majority “not derive any significant portion of their income from persons subject to” air permits and enforcement orders. See, e.g., 83 FR 66184 at 66192 (December 26, 2018). Nor is section 341-C(2) currently in Maine's SIP. Id. In those previous actions, however, Maine DEP committed to revise section 341-C to address the requirement that at least a majority of Board members “not derive a significant portion of their income from persons subject to” air permits or enforcement orders and to submit the necessary provisions to EPA for inclusion in the SIP. Id.

On September 4, 2019, Maine did so, submitting revisions to 38 MRSA sections 341-C(2) and 341-C(8) for inclusion in the SIP. 11

Maine revised section 341-C(2) by adding one word, indicating that Board members “must be chosen to represent the broadest possible public interest and experience that can be brought to bear on the administration and implementation of” Maine's environmental laws. (emphasis added). EPA concludes that the addition of the word “public” only strengthens the conclusion that Maine fulfills the requirement that at least a majority of Board members represent the public interest. As for section 341-C(8), it now provides that:

EPA proposes that section 341-C(2) and (8)(B) satisfy the requirements of CAA § 128(a)(1) that at least a majority of Board members “represent the public interest and do not derive any significant portion of their income from persons subject to” air permits and enforcement orders. EPA also proposes to add revised sections 341-C(2) and (8)(B) to the SIP, as requested by Maine DEP. We are also proposing to convert to full approval our previous conditional approvals of Maine's infrastructure SIP submittals for the 2008 ozone, 2008 Pb and 2010 NO 2 NAAQS (June 18, 2018; 83 FR 28157); the 2010 SO 2 NAAQS (April 30, 2019; 84 FR 18142); the 1997 and 2006 PM 2.5 NAAQS (October 16, 2012; 77 FR 63228); and the 2012 PM 2.5 NAAQS (October 1, 2018; 83 FR 49295) for these particular requirements of section 110(a)(2)(E)(ii).

As noted above, section 128(a)(2) of the Act provides that “any potential conflicts of interest by members of such board or body or the head of an executive agency with similar powers be adequately disclosed.” The purpose of section 128(a)(2) is to assure that conflicts of interest are disclosed by the ultimate decision maker in permit or enforcement order decisions. See, e.g., 80 FR 42446, 42454 (July 17, 2015). Although the Board is the ultimate decision maker on air permitting decisions in Maine, certain air enforcement orders of the Maine DEP Commissioner are not reviewable by the Board, but rather may be appealed directly to Maine Superior Court. For this reason, EPA interprets the potential conflict-of-interest requirements of CAA § 128(a)(2) to be applicable in Maine to both Board members and the DEP Commissioner.

In the infrastructure SIP action for the 2008 Pb, 2008 ozone, and 2010 NO 2 NAAQS, EPA determined that Maine's conflict of interest statute, 5 MRSA § 18, and a provision explicitly making it applicable to Board members, 38 MRSA § 341-C(7), together satisfy the CAA section 128(a)(2) requirement for Maine with respect to Board members, and EPA approved both statutes into the Maine SIP. See 83 FR 28157 (June 18, 2018). For more information, see 83 FR 12905, 12912 (March 26, 2018). EPA proposes that Maine's SIP also satisfies CAA section 128(a)(2) with respect to Board members for the 2015 ozone NAAQS for the same reasons.

Regarding the DEP Commissioner, state law at 38 MRSA § 341-A(3)(D) also explicitly makes that official subject to 5 MRSA § 18, thus satisfying CAA section 128(a)(2) with respect to the Commissioner. While 38 MRSA § 341-A(3)(D) is not currently in the SIP, Maine DEP submitted it to EPA on September 4, 2019, and requested that it be added to the SIP. Therefore, we propose to approve, and incorporate into the Maine SIP, 38 MRSA § 341-A(3)(D) for the 2015 ozone NAAQS. We also propose to convert previous conditional approvals of Maine's infrastructure SIP submittals for the 2008 ozone; 2008 Pb; 2010 NO 2 ; 2010 SO 2 ; 1997, 2006, and 2012 PM 2.5 NAAQS to full approvals for section 128(a)(2).

In sum, and for the reasons provided above, EPA proposes that Maine meets the infrastructure SIP requirements of section 110(a)(2)(E)(ii) for the 2015 ozone NAAQS.

States must establish a system to monitor emissions from stationary sources and submit periodic emissions reports. Each plan shall also require the installation, maintenance, and replacement of equipment, and the implementation of other necessary steps, by owners or operators of stationary sources to monitor emissions from such sources. The state plan shall also require periodic reports on the nature and amounts of emissions and emissions-related data from such sources, and correlation of such reports by each state agency with any emission limitations or standards established pursuant to this chapter. Lastly, the reports shall be available at reasonable times for public inspection.

Maine's infrastructure submittal references several existing state regulations that require sources to monitor emissions and submit reports. Maine 06-096 CMR Chapter 117, “Source Surveillance” specifies air-emission sources that are required to operate continuous emission monitoring systems (CEMS) and details the performance specifications, quality assurance requirements and procedures for such systems, and subsequent record keeping and reporting requirements. See 54 FR 11524 (August 9, 1988). Maine 06-096 CMR Chapter 137, “Emission Statements” requires sources to monitor and report annually to Maine DEP emissions of criteria pollutants and other emissions-related information under certain circumstances. See 82 FR 20257 (May 1, 2017).

Maine cites its regulation for implementing its operating permit program pursuant to 40 CFR part 70: 06-096 CMR Chapter 140, “Part 70 Air Emission License Regulations.” These regulations identify the sources of air emissions that require a Part 70 air emission license and incorporate the requirements of Title IV and Title V of the Clean Air Act, as amended, 42 U.S.C. 7401, et seq.; and 38 MRSA §§ 344 and 590. These regulations contain compliance assurance requirements regarding monitoring and reporting for licensed sources requiring a Part 70 air emission license. See 66 FR 52874 (October 18, 2001). In addition, Maine cites 06-096 CMR Chapter 115, “Major and Minor Source Air Emission License Regulations,” which contains compliance assurance requirements for licensed sources. See 81 FR 50353 (August 1, 2016).

Regarding the section 110(a)(2)(F) requirements that the SIP provides for correlation and public availability of emission reports, Maine's emission statement rule, Chapter 137, requires facilities to report emissions of air pollutants on an annual basis. The Maine DEP uses a web-based electronic reporting system, the Maine Air Emissions Inventory Reporting System (“MAIRIS”), to submit reported emissions data to EPA under the national emission inventory (NEI) program. NEI data are available to the public. 13 The MAIRIS system electronically correlates reported emissions data with permit conditions and other applicable standards and identifies inconsistencies and potential compliance concerns.

In addition, Maine DEP certifies that Maine's Freedom of Access law does not include any exceptions that apply to stationary source emissions and that there are no provisions in Maine law that would prevent the use of any credible evidence of noncompliance, as required by 40 CFR 51.212. See also 06-096 CMR Chapter 140, § 3(E)(7)(a)(v) (“Notwithstanding any other provision in the State Implementation Plan approved by the EPA or Section 114(a) of the CAA, any credible evidence may be used for the purpose of establishing whether a person has violated or is in violation of any statute, regulation, or Part 70 license requirement.”).

EPA proposes that Maine meets the infrastructure SIP requirements of section 110(a)(2)(F) for the 2015 ozone NAAQS.

This section requires that a plan provide for state authority analogous to that provided to the EPA Administrator in section 303 of the CAA, and adequate contingency plans to implement such authority. Section 303 of the CAA provides authority to the EPA Administrator to seek a court order to restrain any source from causing or contributing to emissions that present an “imminent and substantial endangerment to public health or welfare, or the environment.” Section 303 further authorizes the Administrator to issue “such orders as may be necessary to protect public health or welfare or the environment” in the event that “it is not practicable to assure prompt protection . . . by commencement of such civil action.”

We propose to find that a combination of state statutes and regulations discussed in Maine's submittal provides for authority comparable to that given the Administrator in CAA section 303, as explained below. First, 38 MRSA § 347-A, “Emergency Orders,” provides that “[w]henever it appears to the commissioner, after investigation, that there is a violation of the laws or regulations [DEP] administers or of the terms or conditions of any of [DEP's] orders that is creating or is likely to create a substantial and immediate danger to public health or safety or to the environment, the commissioner may order the person or persons causing or contributing to the hazard to immediately take such actions as are necessary to reduce or alleviate the danger.” See 38 MRSA § 347-A(3). Section 347-A further authorizes the DEP Commissioner to initiate an enforcement action in state court in the event of a violation of such emergency order issued by the Commissioner. Id. § 347-A(1)(A)(4). Similarly, 38 MRSA § 348, “Judicial Enforcement,” authorizes DEP to institute injunction proceedings “[i]n the event of a violation of any provision of the laws administered by [DEP] or of any order, regulation, license, permit, approval, administrative consent agreement or decision of the board or commissioner.” Id. § 348(1). Section 348 also authorizes DEP to seek a court order to a restrain a source if it “finds that the discharge, emission or deposit of any materials into any waters, air or land of th[e] State constitutes a substantial and immediate danger to the health, safety or general welfare of any person, persons or property.” Id. § 348(3). Thus, these provisions authorize DEP to issue an administrative order or to seek a court order to restrain any source from causing or contributing to emissions that present an imminent and substantial endangerment to public health or welfare, or the environment, if there is also a violation of a law, regulation, order, or permit administered or issued by DEP, as the case may be.

Maine also cites 38 MRSA § 591, “Prohibitions,” as contributing to its authority. Section 591 provides that “[n]o person may discharge air contaminants into ambient air within a region in such manner as to violate ambient air quality standards established under this chapter or emission standards established pursuant to section 585, 585-B or 585-K.” In those cases where emissions of ozone, or ozone precursors may be causing or contributing to an “imminent and substantial endangerment to public health or welfare, or the environment,” a violation of § 591 would also occur, since Maine law provides that ambient air quality standards are designed to prevent “air pollution,” id. § 584, which state law expressly defines as “the presence in the outdoor atmosphere of one or more air contaminants in sufficient quantities and of such characteristics and duration as to be injurious to human, plant or animal life or to property, or which unreasonably interfere with the enjoyment of life and property,” id. § 582(3) (emphasis added).

In its submittal, Maine further explains that sections 347-A and 591 “together authorize the Commissioner to issue an emergency order upon finding an apparent violation of DEP laws or regulations to address emissions of criteria pollutants, air contaminants governed by standards promulgated under section 585, and hazardous air pollutants governed by standards promulgated under section 585-B.” Maine explains that, in the unlikely event that air emissions create a substantial or immediate threat to the public health, safety, or to the environment without violating any DEP law or regulation, the DEP commissioner can notify the Governor of an imminent threat, and the Governor can then exercise emergency authority under 37-B MRSA § 742 to issue an order to terminate the cause of the emergency. In the declaration of a state of emergency, the Governor may, among other things, “[o]rder the termination, temporary or permanent, of any process, operation, machine or device which may be causing or is understood to be the cause of the state of emergency,” id. § 742(1)(C)(11).

Finally, Maine's submittal cites 06-096 CMR Chapter 109, “Emergency Episode Regulations,” which sets forth various emission reduction plans intended to prevent air pollution from reaching levels that would cause imminent and substantial harm and recognizes the Commissioner's authority to issue additional emergency orders pursuant to 38 MRSA § 347-A, as necessary to the health of persons, by restricting emissions during periods of air pollution emergencies. For these reasons, we propose to find that Maine's submittal and certain state statutes and regulations provide for authority comparable to that provided to the Administrator in CAA § 303.

Section 110(a)(2)(G) also requires that, for any NAAQS, Maine have an approved contingency plan for any Air Quality Control Region (AQCR) within the state that is classified as Priority I, IA, or II. See 40 CFR 51.152(c). A contingency plan is not required if the entire state is classified as Priority III for a particular pollutant. Id. All AQCRs in Maine are classified as Priority III areas for NO 2 and ozone, pursuant to 40 CFR 52.1021. Consequently, as relevant to this proposed rulemaking action, Maine's SIP does not need to contain an emergency contingency plan meeting the specific requirements of 51.152 with respect to NO 2 and ozone.

Maine does, however, as a matter of practice, post on the internet daily forecasted ozone levels through the EPA AIRNOW and EPA ENVIROFLASH systems. Information regarding these two systems is available on EPA's website at www.airnow.gov. Notices are sent out to ENVIROFLASH participants when levels are forecast to exceed the current 8-hour ozone standard. In addition, when levels are expected to exceed the ozone standard in Maine, the media are alerted via a press release, and the National Weather Service (NWS) is alerted to issue an Air Quality Advisory through the normal NWS weather alert system. These actions are similar to the notification and communication requirements of 40 CFR 51.152.

EPA proposes that Maine meets the applicable infrastructure SIP requirements for section 110(a)(2)(G), including contingency-plan requirements, for the 2015 ozone NAAQS.

This section requires that a state's SIP provide for revision from time to time as may be necessary to take account of changes in the NAAQS or availability of improved methods for attaining the NAAQS and whenever EPA finds that the SIP is substantially inadequate.

Maine's infrastructure submittal references 38 MRSA § 581, “Declaration of findings and intent,” which characterizes the state's laws regarding the Protection and Improvement of Air as an exercise of “the police power of the State in a coordinated state-wide program to control present and future sources of emission of air contaminants to the end that air polluting activities of every type shall be regulated in a manner that reasonably insures the continued health, safety and general welfare of all of the citizens of the State; protects property values and protects plant and animal life.”

In addition, we note that Maine DEP is required by statute to “prevent, abate and control the pollution of the air[, to] preserve, improve and prevent diminution of the natural environment of the State[, and to] protect and enhance the public's right to use and enjoy the State's natural resources.” See 38 MRSA § 341-A(1). Furthermore, DEP is authorized to “adopt, amend or repeal rules and emergency rules necessary for the interpretation, implementation and enforcement of any provision of law that the department is charged with administering.” Id. § 341-H; see also id. § 585-A (recognizing DEP's rulemaking authority to propose SIP revisions). These statutes give Maine DEP the power to revise the Maine SIP from time to time as may be necessary to take account of changes in the NAAQS or the availability of improved methods for attaining the NAAQS and whenever the EPA finds that the SIP is substantially inadequate. Therefore, EPA proposes that Maine meets the infrastructure SIP requirements of CAA section 110(a)(2)(H) with respect to the 2015 ozone NAAQS.

Section 110(a)(2)(I) provides that each plan or plan revision for an area designated as a nonattainment area shall meet the applicable requirements of part D of the CAA. EPA interprets section 110(a)(2)(I) to be inapplicable to the infrastructure SIP process because specific SIP submissions for designated nonattainment areas, as required under part D, are subject to a different submission schedule under subparts 2 through 5 of part D, extending as far as 10 years following area designations for some elements, whereas infrastructure SIP submissions are due within three years after adoption or revision of a NAAQS. Accordingly, EPA takes action on part D attainment plans through separate processes.

Section 110(a)(2)(J) of the CAA requires that each SIP “meet the applicable requirements of section 121 of this title (relating to consultation), section 127 of this title (relating to public notification), and part C of this subchapter (relating to PSD of air quality and visibility protection).” The evaluation of the submission from Maine with respect to these requirements is described below.

Pursuant to CAA section 121, a state must provide a satisfactory process for consultation with local governments and Federal Land Managers (FLMs) in carrying out its NAAQS implementation requirements.

Maine 38 MRSA § 341-A(1) authorizes Maine DEP to “prevent, abate and control the pollution of the air[,] improve and prevent diminution of the natural environment of the State[,] protect and enhance the public's right to use and enjoy the State's natural resources and . . . educate the public on natural resource use, requirements and issues.” Maine state law further provides that one of the purposes of the BEP is “to provide for credible, fair and responsible public participation in department decisions,” 38 MRSA § 341-B, and authorizes it to “cooperate with other state or federal departments or agencies to carry out” its responsibilities, id. § 341-F(6). In addition, 06-096 CMR Chapter 115, § IX(E)(3), which was approved by EPA on March 23, 1993, requires DEP to provide notice to relevant municipal officials and FLMs, among others, of DEP's preparation of a draft permit for a new or modified source. See 58 FR 15422.

In addition, with respect to area reclassifications to Class I, II, or III for PSD purposes, the DEP is required to offer an opportunity for a public hearing and to consult with appropriate FLMs. See 38 MRSA § 583-B; and 06-096 CMR Chapter 114, § 1(E). Maine's Transportation Conformity rule at 06-096 CMR Chapter 139 also provides procedures for interagency consultation, resolution of conflicts, and public consultation and notification. Finally, the Maine Administrative Procedure Act (Maine Revised Statutes Title 5, Chapter 375, subchapter 2) requires notification and provision of comment opportunities to all parties affected by proposed regulations. All SIP revisions undergo public notice and opportunity for hearing, which allows for comment by the public, including local governments. EPA proposes that Maine meets the infrastructure SIP requirements of this portion of section 110(a)(2)(J) for the 2015 ozone NAAQS.

Pursuant to CAA section 127, states must notify the public if NAAQS are exceeded in an area, advise the public of health hazards associated with exceedances, and enhance public awareness of measures that can be taken to prevent exceedances and of ways in which the public can participate in regulatory and other efforts to improve air quality.

As mentioned above, 38 MRSA § 341-A(1) authorizes Maine DEP to, among other things, “educate the public on natural resource use, requirements and issues.” To that end, the DEP issues press releases and posts warnings on its website advising people what they can do to help prevent NAAQS exceedances and avoid adverse health effects on poor air quality days. In addition, the Maine DEP website includes near real-time air quality data, and a record of historical data. Air quality forecasts are distributed daily via email to interested parties. Air quality alerts are sent by email to a large number of affected parties, including the media. Alerts include information about the health implications of elevated pollutant levels and list actions to reduce emissions and to reduce the public's exposure. Also, Air Quality Data Summaries of the year's air quality monitoring results are issued annually and posted on the Maine DEP website. The state is also an active partner in EPA's AirNow and EnviroFlash air quality alert programs.

EPA proposes that Maine meets the infrastructure SIP requirements of this portion of section 110(a)(2)(J) for the 2015 ozone NAAQS.

EPA has already discussed Maine's PSD program in the context of infrastructure SIPs in the paragraphs addressing section 110(a)(2)(C) and 110(a)(2)(D)(i)(II) and determined that it satisfies the requirements of EPA's PSD implementation rules. Therefore, the SIP also satisfies the PSD sub-element of section 110(a)(2)(J) for the 2015 ozone NAAQS. EPA proposes to approve the SIP for the PSD sub-element of section 110(a)(2)(J) for the 2015 ozone NAAQS.

States are subject to visibility and regional haze program requirements under part C of the CAA (which includes sections 169A and 169B). In the event of the establishment of a new NAAQS, however, the visibility and regional haze program requirements under part C do not change. Thus, as noted in EPA's 2013 memorandum, we find that there is no new visibility obligation “triggered” under section 110(a)(2)(J) when a new NAAQS becomes effective. In other words, the visibility protection requirements of section 110(a)(2)(J) are not germane to infrastructure SIPs for the 2015 ozone NAAQS. Therefore, we are not proposing action on this sub-element.

Section 110(a)(2)(K) of the Act requires that a SIP provide for the performance of such air quality modeling as the EPA Administrator may prescribe for the purpose of predicting the effect on ambient air quality of any emissions of any air pollutant for which EPA has established a NAAQS, and the submission, upon request, of data related to such air quality modeling. EPA has published modeling guidelines at 40 CFR part 51, Appendix W, for predicting the effects of emissions of criteria pollutants on ambient air quality. EPA also recommends in the 2013 memorandum that, to meet section 110(a)(2)(K), a state submit or reference the statutory or regulatory provisions that provide the air agency with the authority to conduct such air quality modeling and to provide such modeling data to EPA upon request.

Maine state law implicitly authorizes Maine DEP to perform air quality modeling and provide such modeling data to EPA upon request. See 38 MRSA §§ 341-A(1), 581, 591-B. In addition, EPA-approved 06-096 CMR Chapter 115, “Major and Minor Source Air Emissions License Regulations,” and 06-096 CMR Chapter 140 Part 70, “Air Emission License Regulations,” provide that any modeling required for pre-construction permits and operating permits for minor and major sources be performed consistent with EPA-prescribed modeling guidelines at 40 CFR part 51, appendix W. Chapter 115 also requires that applicants submit data related to modeling to Maine DEP. See 06-096 CMR chapter 115, § VII.E. Consequently, the SIP provides for such air quality modeling as the Administrator has prescribed and for the submission, upon request, of data related to such modeling.

In its infrastructure submittal, DEP also cites 06-096 CMR Chapter 116, “Prohibited Dispersion Techniques,” which includes regulations applicable to the State's air quality modeling consistent with federal requirements concerning stack height and other dispersion techniques, such as merging of plumes. These regulations also define the area surrounding the source where ambient air quality standards do not have to be met. Maine also collaborates with the Ozone Transport Commission (OTC) and the Mid-Atlantic Regional Air Management Association and EPA in order to perform large-scale urban air shed modeling for ozone if necessary.

EPA proposes that Maine meets the requirements of section 110(a)(2)(K) for the 2015 ozone NAAQS.

This section requires SIPs to mandate that each major stationary source pay permitting fees to cover the costs of reviewing, approving, implementing, and enforcing a permit.

Maine implements and operates a Title V permit program, see 38 MRSA § 353-A; 06-096 CMR Chapter 140, which was approved by EPA on October 18, 2001, see 66 FR 52874. To gain this approval, Maine demonstrated the ability to collect sufficient fees to run the program. See 61 FR 49289 (September 19, 1996). Maine also notes in its infrastructure submittal that the costs of all CAA permitting, implementation, and enforcement for new or modified sources are covered by Title V fees, which are set by Maine DEP. See 38 MRSA §§ 353-A, 352(2)(E). Therefore, EPA proposes that Maine meets the infrastructure SIP requirements of section 110(a)(2)(L) for the 2015 ozone NAAQS.

To satisfy Element M, states must provide for consultation with, and participation by, local political subdivisions affected by the SIP. Maine Administrative Procedure Act, 5 MRSA Chapter 375, requires public notice of all SIP revisions prior to their adoption, which allows for comment by the public, including local political subdivisions. In addition, Maine cites 38 MRSA § 597, “Municipal air pollution control,” which provides that municipalities are not preempted from studying air pollution and adopting and enforcing “air pollution control and abatement ordinances” that are more stringent than those adopted by DEP or that “touch on matters not dealt with” by state law. Finally, Maine cites Chapter 9 of Maine's initial SIP, which was approved on May 31, 1972 and contains intergovernmental cooperation provisions. See 37 FR 10842.

EPA proposes that Maine meets the infrastructure SIP requirements of section 110(a)(2)(M) with respect to the 2015 ozone NAAQS.

As noted under sections 110(a)(2)(A) and (E) above, Maine submitted revisions to a regulation and to a statute for approval into the Maine SIP. On May 22, 2019, Maine submitted a SIP revision containing Maine's updated Chapter 110, “Ambient Air Quality Standards.” EPA is proposing to approve this revised regulation into the Maine SIP in order to update Maine's ambient air quality standards to be consistent with the 2015 ozone and 2012 PM 2.5 , and to align the rules governing the Maine ambient air quality standards to provide consistency with the federal NAAQS.

On September 4, 2019, to meet conflict-of-interest requirements of section 110(a)(2)(E) for the 2015 ozone NAAQS, as well as for previous infrastructure submittals for other NAAQS, Maine submitted Maine Public Law 2019, Chapter 180 amending 38 MRS Sections 341-C(2) and 341-C(8), effective September 19, 2019; and 38 MRS Section 341-A(3)(D), effective June 15, 2011. EPA is proposing to approve these conflict-of-interest provisions into the Maine SIP.

On May 18, 2020, Maine submitted a negative declaration for the 2016 Oil and Natural Gas Industry CTG for the 2008 and 2015 ozone standards. The term “negative declaration” means that the state has explored whether any facilities subject to the applicability requirements of the CTG exist within the state and concluded that there are no such sources within its borders. The negative declaration means that Maine has no applicable stationary sources of VOC that are covered by this CTG. This is consistent with EPA's understanding of where sources subject to the Oil and Natural Gas Industry CTG are located based on EPA data resources of industrial activity within the United States, such as the National Emissions Inventory (NEI) database of sources of air pollution, which is available at: https://www.epa.gov/air-emissions-inventories/national-emissions-inventory-nei. We also note that EPA Region 1 worked with Maine, and EPA headquarters' technical experts on the CTG, to review the applicability criteria of EPA's 2016 Oil and Gas CTG to assist Maine with its determination. Therefore, we are proposing to approve Maine's negative declaration into the SIP.

EPA is proposing to approve most of the elements of the infrastructure SIP submitted by Maine on February 14, 2020, for the 2015 ozone NAAQS. Today's action does not include the “good neighbor” provisions ( i.e., section 110(a)(2)(D)(i)), also known as a state's Transport SIP. Maine's Transport SIP for the 2015 ozone NAAQS will be addressed in a future action.

EPA's proposed action regarding each infrastructure SIP requirement for the 2015 ozone NAAQS is contained in Table 1 below.

EPA also is proposing to approve, and incorporate into the Maine SIP, the following Regulation, submitted on May 28, 2019, and Statutes, submitted on September 4, 2019:

06-096 CMR Chapter 110, “Ambient Air Quality Standards,” effective March 27, 2019.

Maine Public Law 2019, Chapter 180 amending 38 MRS Sections 341-C(2) and 341-C(8) (except 341-C(8)A), effective September 19, 2019.

Maine Public Law 2011, Chapter 357 amending 38 MRS Section 341-A(3)(D), effective June 15, 2011.

In addition, we are proposing to convert to full approvals previous conditional approvals of section 110(a)(2)(E) in Maine's infrastructure SIPs for the 2008 ozone; 2008 Pb; 2010 NO 2 ; 2010 SO 2 ; and 1997, 2006, and 2012 PM 2.5 NAAQS, as well as previous conditional approvals of section 110(a)(2)(A) in Maine's infrastructure SIPS for the 1997 and 2006 PM 2.5 .

Finally, we are proposing to approve a negative declaration for EPA's 2016 CTG entitled “Control Techniques Guidelines for the Oil and Natural Gas Industry” for the 2008 and 2015 ozone standards into the Maine SIP.

EPA is soliciting public comments on the issues discussed in this proposal or on other relevant matters. These comments will be considered before EPA takes final action. Interested parties may participate in the Federal rulemaking procedure by submitting comments to this proposed rule by following the instructions listed in the ADDRESSES section of this Federal Register .

In this rule, EPA is proposing to include in a final EPA rule regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, EPA is proposing to incorporate by reference amendments to Maine's regulation Chapter 110, Ambient Air Quality Standards, and conflict-of-interest provisions in Maine's 38 MRSA Section 341. EPA has made, and will continue to make, these documents generally available through https://www.regulations.gov and at the EPA Region 1 Office (please contact the person identified in the FOR FURTHER INFORMATION CONTACT section of this preamble for more information).

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

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

• Is not expected to be an Executive Order 13771 regulatory action because this action is not significant under Executive Order 12866;

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

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

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

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

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

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

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

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

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

This action is directed to the public in general. This action, however, may be of particular interest to those persons who manufacture (which includes import), distribute in commerce, process, use, or dispose of one or more of the 54 Per- and Polyfluoroalkyl Substances (PFAS) identified in the petition. Since other entities may also be interested, the Agency has not attempted to describe all the specific entities that may be affected by this action.

Under TSCA section 21 (15 U.S.C. 2620), any person can petition EPA to initiate a proceeding for the issuance, amendment, or repeal of a rule under TSCA sections 4, 6, or 8, or to issue an order under TSCA sections 4, 5(e), or 5(f). A TSCA section 21 petition must set forth the facts which it is claimed establish that it is necessary to initiate the action requested. EPA is required to grant or deny the petition within 90 days of its filing. If EPA grants the petition, the Agency must promptly commence an appropriate proceeding. If EPA denies the petition, the Agency must publish its reasons for the denial in the Federal Register . A petitioner may commence a civil action in a U.S. district court seeking to compel initiation of the requested proceeding within 60 days of a denial or, if EPA does not issue a decision, within 60 days of the expiration of the 90-day period.

TSCA section 21(b)(1) requires that the petition “set forth the facts which it is claimed establish that it is necessary” to initiate the proceeding requested. 15 U.S.C. 2620(b)(1). Thus, TSCA section 21 implicitly incorporates the statutory standards that apply to the requested actions. Accordingly, EPA has relied on the standards in TSCA section 21 and in the provisions under which actions have been requested in evaluating this TSCA section 21 petition.

EPA must make several findings in order to require testing under TSCA section 4(a)(1)(A)(i) through a rule or order. EPA must find that the manufacture, distribution in commerce, processing, use, or disposal of a chemical substance or mixture, or that any combination of such activities, may present an unreasonable risk of injury to health or the environment; that information and experience are insufficient to reasonably determine or predict the effects of a chemical substance on health or the environment; and that testing of the chemical substance is necessary to develop the missing information. Further, TSCA section 4(h) requires EPA to reduce and replace the use of vertebrate animals in the testing of chemical substances or mixtures, to the extent practicable, scientifically justified, and consistent with the policies of TSCA.

TSCA section 26(h) requires EPA, in carrying out TSCA sections 4, 5, and 6, to make a decision using “scientific information, technical procedures, measures, methods, protocols, methodologies, or models, employed in a manner consistent with the best available science,” while also taking into account six considerations, including the relevance of information and any uncertainties. TSCA section 26(i) requires that decisions under TSCA sections 4, 5, and 6 be “based on the weight of scientific evidence.” TSCA section 26(k) requires that EPA consider information that is reasonably available in carrying out TSCA sections 4, 5, and 6.

On October 14, 2020, Center for Environmental Health, Cape Fear River Watch, Clean Cape Fear, Democracy Green, Toxic Free NC, and the NC Black Alliance (petitioners) petitioned EPA to initiate a rulemaking proceeding or issue an order under TSCA section 4(a)(1)(A)(i), compelling health and environmental effects testing, including studies of communities exposed to PFAS-contaminated drinking water, on 54 PFAS that the petitioners assert are manufactured by The Chemours Company (Chemours) at its chemical production facility in Fayetteville, North Carolina. The petitioners also request that EPA ask the National Academy of Sciences to create an independent science panel to oversee all aspects of the testing program requested by the petitioners (Ref. 1).

The petitioners assert that TSCA section 4(a)(1)(A)(i) requires EPA to direct testing on a chemical substance or mixture if all three of the following findings are made:

• The manufacture, distribution in commerce, processing, use, or disposal of a chemical substance or mixture, or that any combination of such activities, may present an unreasonable risk of injury to health or the environment;

• There is insufficient information and experience upon which the effects of such manufacture, distribution in commerce, processing, use, or disposal of such substance or mixture or of any combination of such activities on health or the environment can reasonably be determined or predicted; and

• Testing of such substance or mixture with respect to such effects is necessary to develop such information.

The petitioners assert that the 54 PFAS “may present an unreasonable risk of injury to health or the environment” because there allegedly is substantial evidence that PFAS may be toxic, pointing to the following documents:

• The Agency for Toxic Substances and Disease Registry's (ATSDR's) draft 2018 Toxicological Profile for Perfluoroalkyls (Ref. 2) and EPA's PFAS Action Plan (Ref. 3), as well as other literature, in support of the contention that exposure to certain, specific PFAS are associated with adverse health effects.

• EPA's Significant New Use Rule (SNUR) for Long-Chain Perfluoroalkyl Carboxylate and Perfluoroalkyl Sulfonate Chemical Substances (Ref. 4), which states “[w]hile most studies to date have focused primarily on PFOS, structure-activity relationship analysis indicates that the results of those studies are applicable to the entire category of PFAS, which includes PFOS. Available test data have raised concerns about their potential developmental, reproductive, and systemic toxicity.”

• EPA's Consent Order regarding DuPont Premanufacture Notices (Ref. 5), which states in part “[t]oxicity studies on the analogs PFOA (perfluorooctanoic acid) and PFOS (perfluorooctanesulfonic acid) indicate developmental, reproductive and systemic toxicity in various species. Cancer may also be of concern. These factors, taken together, raise concerns for potential adverse chronic effects in humans and wildlife.”

The petitioners conclude, based on the references provided, that “all PFAS have the potential for causing the adverse health and environmental effects linked to well-characterized substances like PFOS and PFOA because of their common structural characteristics,” and that “there is a strong basis to conclude that the 54 PFAS covered by this petition `may present an unreasonable risk of injury' ” (Ref. 1, pg. 18).

The petitioners assert that for these 54 PFAS, there is insufficient information and experience upon which the effects of such manufacture, distribution in commerce, processing, use, or disposal of such substance or mixture or of any combination of such activities on health or the environment can reasonably be determined or predicted. To support their assertion, the petitioners point to:

• ATSDR's draft 2018 Toxicological Profile for Perfluoroalkyls (Ref. 2), which the petitioners assert underscores the absence of toxicological data; and

• EPA's PFAS Action Plan (Ref. 3), which states “[t]here are many PFAS of potential concern to the public that may be found in the environment. Most of these PFAS lack sufficient toxicity data to inform our understanding of the potential for adverse human or ecological effects.”

On page 21 of their petition, the petitioners assert: “[k]ey data gaps include measurement of physical-chemical properties, methods of analysis, assessment of partitioning, bioaccumulation, and degradation, pharmacokinetics, and toxicity, especially for the endpoints commonly observed for the better studied PFAS, such as liver toxicity, and effects on the immune system, lipid metabolism, kidney, thyroid, development, reproduction, and cancer. In addition, despite their widespread detection in environmental media, ecotoxicity data are generally lacking.”

The petitioners assert that the mechanisms of PFAS toxic effects are not defined, and that in vitro assays or other predictive, computational approaches are not validated or available. The petitioners also request animal toxicity studies on three mixtures of PFAS that are allegedly representative of exposure for residents in the Cape Fear Watershed.

Finally, the petitioners request ecotoxicity studies, and studies of physical chemical properties and environmental fate and transport, which they say EPA “has previously determined are necessary because of the widespread presence and mobility of PFAS in environmental media.”

The petitioners propose a testing approach that they call for Chemours to perform. The list of 54 PFAS was divided into Tier 1 substances for which there is “known human exposure based on detection in blood, food, or drinking water,” and Tier 2 substances for which “human exposure is probable based on detection in environmental media” (Ref. 1, pg.12). The testing approach includes human health effects studies in experimental animals, animal studies on PFAS mixtures, studies of communities exposed to PFAS-contaminated drinking water, human half-life studies, physical-chemical properties and fate and transport studies, and ecotoxicity testing.

To understand EPA's reasons for denying the petitioners' requests, it is important to first review the details of EPA's ongoing actions involving PFAS. EPA is committed to supporting states, tribes, and local communities in addressing challenges with PFAS. As a part of this effort, EPA is already taking action to identify solutions to address PFAS in the environment. Examples of such ongoing actions are detailed in this unit.

In May 2018, EPA convened a two-day National Leadership Summit on PFAS that brought together more than 200 federal, state, and local leaders to discuss steps to address PFAS. The Summit set the following goals: Evaluate the need for a maximum contaminant level for PFOA and PFOS in drinking water, evaluate designating PFOA and PFOS as hazardous substances, issue groundwater cleanup guidances for PFOA and PFOS, and develop toxicity values for GenX and perfluorobutane sulfonic acid (PFBS). Following the Summit, EPA interacted with more than 1,000 people during PFAS-focused community engagement events in Exeter, New Hampshire; Horsham, Pennsylvania; Colorado Springs, Colorado; Fayetteville, North Carolina; and Leavenworth, Kansas, as well as through a roundtable in Kalamazoo, Michigan, and an event with tribal representatives in Spokane, Washington. As a result of these meetings and building on the goals identified at the Summit and the approximately 120,000 public comments received by the agency, EPA developed the PFAS Action Plan, which was issued in February 2019 (Ref. 3).

The PFAS Action Plan is the first multi-media, multi-program, national research, management, and risk communication plan to address an emerging contaminant like PFAS. The PFAS Action Plan outlines the tools EPA is developing to, among other things, address PFAS in drinking water, identify and clean up PFAS contamination, expand monitoring of PFAS, increase PFAS scientific research, and exercise effective enforcement tools. The Action Plan outlines EPA's commitment to take a wide variety of actions to address this emerging contaminant in both short-term and long-term timeframes. Together, these efforts are helping EPA and its partners identify and better understand PFAS contaminants generally, clean up current PFAS contamination, prevent future contamination, and effectively communicate risk with the public. In February 2020, EPA issued the PFAS Action Plan: Program Update (available at https://www.epa.gov/pfas/pfas-action-plan-program-update-february-2020 ) to provide an update on all of the actions taken and work completed in the year since the PFAS Action Plan was issued. As it continues to implement the PFAS Action Plan, EPA is committed to coordinating closely with multiple entities, including other federal agencies, states, tribes, local governments, water utilities, industry, and the public.

EPA's Office of Water (OW) is currently leading multiple actions in the PFAS Action Plan that will help the Agency better understand and effectively manage risk from exposure to PFAS. These OW-led actions include developing analytical methods for detecting PFAS in drinking water and other environmental media, evaluating PFAS treatment techniques, conducting data collection and analysis to evaluate the need for regulations to control PFAS discharges from certain categories of point sources, understanding PFAS exposure from various environmental media, and evaluating statutory and regulatory mechanisms to manage adverse human health and environmental impacts from PFAS exposure.

While OW's work is advancing, a need for an interim strategy to address point source discharges of PFAS in EPA-issued NPDES permits was identified. On February 6, 2020, a workgroup was established to develop an interim NPDES permitting strategy to address PFAS in EPA-issued CWA section 402 permits. The workgroup was charged with exploring options for how to address these pollutants while the CWA framework for addressing PFAS discharges pursuant to the NPDES program is under development. The workgroup's goal was to develop a strategy that would serve to guide the Agency's CWA NPDES permitting approach on an interim basis across the EPA Regions as informed by input from state partners. Each of the ten EPA Regions appointed a representative to the workgroup.

To develop potential recommendations for an interim PFAS NPDES strategy, the workgroup conducted a thorough review of the NPDES permitting process, with a specific focus on PFAS. This included examining CWA section 402 authorities and permit writing practices to understand where unregulated contaminants, such as PFAS, may fit into the permit development process; analyzing existing state-issued NPDES permits with PFAS monitoring requirements (identified through EPA's NPDES Integrated Compliance Information System (ICIS)) to understand the prescribed analytical methods for detecting PFAS, monitoring frequency, and detection benchmarks in current permits; and obtaining input and perspectives from state partners. In November 2020, EPA issued a memo detailing an interim NPDES permitting strategy for PFAS. This strategy is being implemented for EPA-issued NPDES permits.

On October 26-27, 2020, the National Academies of Science, Engineering, and Medicine (NASEM) held a Workshop on Federal Government Human Health PFAS Research. This workshop was the result of collaboration between EPA, the U.S. Department of Defense (DoD), the U.S. Department of Agriculture (USDA), and the U.S. Department of Health and Human Services (HHS) and will help further coordinate PFAS research across the federal government. Aggressively addressing PFAS has been an active and ongoing priority for this Administration, and the goal of the workshop was to discuss ongoing federal research and data gaps. Following the workshop, NASEM will compile a report summarizing the discussion and views of workshop participants on how to ensure that the federal research program for PFAS is robust and focused on addressing the highest priority human health research. Workshop proceedings will be published in early 2021.

EPA has taken a number of actions under SDWA, consistent with the PFAS Action Plan and its statutory and regulatory authorities. In 2016, EPA established health advisories for PFOA and PFOS (Ref. 6) based on the Agency's assessment of the latest peer-reviewed science to provide drinking water system operators, and state, tribal and local officials who have the primary responsibility for overseeing these systems, with information on the health risks of these chemicals, so they can take the appropriate actions to protect their residents. To provide Americans, including the most sensitive populations, with a margin of protection from a lifetime of exposure to PFOA and PFOS from drinking water, EPA established the health advisory levels at 70 parts per trillion.

EPA is committed to following the regulatory process established under SDWA and supporting states and public water systems as they determine the appropriate steps to reduce exposure to PFOA and PFOS in drinking water.

On March 10, 2020, EPA published a notice (85 FR 14098, FRL-10005-88) seeking comment on proposed determinations to regulate PFOA and PFOS. EPA is considering the public comments on this notice and expects to issue final regulatory determination in January 2021. If EPA issues final determinations to regulate PFOA and PFOS, SDWA requires that the EPA publish a proposed regulation within 24 months of the final determination and promulgate a final regulation within 18 months of proposal (SDWA allows the Agency to extend that final rule deadline by 9 months).

Under the third Unregulated Contaminant Monitoring Rule (UCMR 3) (85 FR 26072, FRL-9660-4), from 2013 to 2015, EPA required almost 5,000 public water systems to monitor for six PFAS (see https://www.epa.gov/dwucmr/third-unregulated-contaminant-monitoring-rule ). The results of this monitoring were used by EPA in making the proposed regulatory determination for PFOA and PFOS. EPA has committed to monitoring for more PFAS in the UCMR 5 and at lower levels than was possible under the UCMR 3. EPA expects to publish a proposed UCMR 5 in January 2021.

EPA launched the PFOA Stewardship Program (Ref. 7) in January, 2006 because of concerns about the impact of PFOA and long-chain PFAS on human health and the environment, including concerns about their persistence, presence in the environment and in the blood of the general U.S. population, long half-life in people, and developmental and other adverse effects in laboratory animals.

By March 1, 2006, the eight major companies in the PFAS industry submitted commitments to the PFOA Stewardship Program. Specifically, these companies committed to reducing PFOA from facility emissions and product content by 95 percent no later than 2010, and to work toward eliminating PFOA from emissions and product content no later than 2015. The companies participating in the PFOA Stewardship Program were global companies with business operations in the United States and other countries.

To meet the program goals, most companies stopped the manufacture and import of long-chain PFAS, and then transitioned to alternative chemicals. Other companies exited the PFAS industry altogether. All participating companies state that they met the PFOA Stewardship Program goals. In July 2020 EPA codified and expanded the impact of the PFOA Stewardship program through the issuance of the long chain PFAS SNUR, as discussed in Unit III.H.

The National Defense Authorization Act for Fiscal Year 2020 (NDAA) (Pub. L. 116-92) added certain PFAS to the list of chemicals required to be reported to the TRI and established a 100-pound reporting threshold for these substances. EPA's TRI is an important tool that provides the public with information about the use of certain chemicals by tracking their management and associated activities. U.S. facilities in different industry sectors must report annually how much of each chemical is released to the environment and/or managed through recycling, energy recovery, and treatment. TRI helps support informed decision-making by companies, government agencies, non-governmental organizations and the public. For example, EPA uses TRI information to understand releases and potential exposures to chemicals being assessed under TSCA.

In June 2020, the Agency published a final rule (85 FR 37354, June 22, 2020; FRL-10008-09) that updated the regulations to reflect the addition of these PFAS to the TRI by the NDAA. Per the NDAA requirements, the PFAS additions became effective as of January 1, 2020. Reporting for these PFAS will be due to EPA by July 1, 2021, for calendar year 2020 data. By July 31, 2021, EPA expects to release raw data concerning the TRI-listed PFAS from information collected. Additionally, the NDAA provides a framework for additional PFAS to be added automatically to the TRI list on January 1 of the year following certain EPA actions (NDAA section 7321(c)). For example, the NDAA automatically adds a PFAS to the TRI list in response to the EPA finalizing a toxicity value for it.

EPA has taken a range of regulatory actions under TSCA to address potential exposures and/or risks associated with manufacturing, processing, and use of PFAS. EPA's New Chemicals program reviews alternatives for PFOA and related chemicals before they enter the marketplace to identify whether the range of toxicity, fate and bioaccumulation issues that have caused past concerns with perfluorinated substances may be present in order to ensure that the new chemicals do not present an unreasonable risk to health or the environment.

TSCA Section 5(a) SNURs can be used to require notice to EPA before chemical substances and mixtures are used in new ways that might create concerns. Under TSCA section 5(a), EPA can determine that a use of a chemical substance is a “significant new use.” EPA must make this determination by rule after considering all relevant factors, including those listed in TSCA section 5(a)(2):

• Projected volume of manufacturing and processing of a chemical substance.

• Extent to which a use changes the type or form of exposure of humans or the environment to a chemical substance.

• Extent to which a use increases the magnitude and duration of exposure of humans or the environment to a chemical substance.

• Reasonably anticipated manner and methods of manufacturing, processing, distribution in commerce, and disposal of a chemical substance.

Once EPA designates a use of a chemical substance as a significant new use, TSCA section 5(a) requires persons to submit a significant new use notice (SNUN) to EPA at least 90 days before they manufacture (including import) or process the chemical substance for that use. The SNUN obligates EPA to assess risks that may be associated with that significant new use, including risks to potentially exposed or susceptible subpopulations identified as relevant by EPA under the conditions of use; make a determination under the statute; and, if appropriate, regulate the proposed activity before it occurs.

EPA has issued the following SNURs for PFOS and PFAS:

• On March 11, 2002, EPA issued a final SNUR (Ref. 8) for 13 PFAS specifically included in the voluntary phase out of PFOS by 3M that took place between 2000 and 2002.

• On December 9, 2002, EPA issued a final SNUR (Ref. 9) for 75 PFAS specifically included in the voluntary phase out of PFOS by 3M that took place between 2000 and 2002.

• On October 9, 2007, EPA issued a final SNUR (Ref. 10) for 183 PFAS that were on the public TSCA Inventory and have the characteristic PFAS chemical structure of a perfluorinated carbon chain (Rf) greater than, or equal to, C5 attached to an SO 2 group connected to the rest of the molecule. In addition, the proposal also included those chemicals with Rf ranges of perfluorinated carbon chains shorter than C5, and greater than C5, for example, C4-C12 and C6-C12.

• On October 22, 2013, EPA issued a final SNUR (Ref. 11) for certain PFOA-related chemicals as part of carpets, a category of potentially harmful chemicals once used on carpets to impart soil, water, and stain resistance.

• On July 27, 2020, EPA issued a final SNUR (Ref. 12) for certain PFOA-related chemicals. The SNUR modifies the requirements for a subset of LCPFAC chemical substances in the existing SNUR at 40 CFR 721.10536 in the following ways: (1) Designating manufacturing (including importing) or processing of LCPFAC chemical substances listed in the list of LCPFAC chemical substances for any use that was no longer ongoing after December 31, 2015, as a significant new use; and (2) Designating manufacturing (including importing) or processing of PFOA or its salts, which are considered LCPFAC chemical substances, and all other LCPFAC chemical substances for any use not ongoing as of January 21, 2015, the date on which the proposed rule was published, as a significant new use. For this final SNUR, EPA also made an exemption at 40 CFR 721.45(f) inapplicable for persons who import LCPFAC chemical substances listed in the list of LCPFAC chemical substances in this unit and PFOA or its salts as part of a surface coating on articles because there is reasonable potential for exposure to LCPFAC chemical substances, including PFOA, if these chemical substances are incorporated as surface coatings in articles and then imported.

In addition, in December 2020, EPA issued draft guidance (Ref. 13) for public comment outlining which imported articles are covered by the July 2020 final rule for certain long-chain PFAS. After considering comments, EPA intends to issue the final guidance promptly.

PFOS was not reported as manufactured (including imported) into the United States as part of the 2012 Chemical Data Reporting (CDR) effort or the previous collection effort in 2006. CDR requires manufacturers (including importers) to report if they meet certain production volume thresholds, generally 25,000 lbs at a single site. The last time PFOS manufacture was reported to EPA as part of this collection effort was 2002; nonetheless, there are some limited ongoing uses of PFOS (see 40 CFR 721.9582).

Building on the work outlined in the February 2019 PFAS Action Plan, the Agency expanded its research efforts and capabilities by launching the PFAS Innovative Treatment Team (PITT) in spring 2020. The PITT was a full-time, multi-disciplinary research team that concentrated their efforts and expertise on a single problem for six months: How to remove, destroy, and test PFAS-contaminated media and waste. The PITT's goals were to:

• Assess current and emerging destruction methods being explored by EPA, universities, other research organizations, and industry;

• Explore the efficacy of destruction methods while considering by-products to avoid creating new environmental hazards; and

• Evaluate destruction methods' feasibility, performance, and costs to validate potential solutions.

This work initiated under the PITT will add practical knowledge to EPA's efforts under the PFAS Action Plan. States, tribes, and local governments will be able to use this information to select the approach that best fits their circumstances, leading to greater confidence in cleanup operations and safer communities.

Besides the innovative work of PITT, EPA and its researchers continue to work hard in many other areas to help the nation address PFAS and protect public health. This work includes:

• Validating methods to detect and quantify PFAS in various environmental media, such as water, air, and biosolids. EPA has already released a number of these methods, including Methods 533 and 537.1 that together can measure 29 PFAS in drinking water;

• Evaluating treatment technologies that remove PFAS from drinking water. For example, researchers are investigating the effectiveness of point-of-use systems and have recently published research on commercially available systems that use both reverse osmosis and granular activated carbon;

• Developing standard human health toxicity reference values for certain PFAS. For example, Agency scientists are working on a toxicity assessment for PFBS, GenX chemicals, and five other PFAS that will help states, tribes, and local communities understand the toxicity of these substances so that they can make more informed choices to protect the public's health;

• Providing technical assistance to states and tribes as they work to address a variety of PFAS challenges; and

• Funding external researchers to better understand the potential impacts of PFAS on water quality and availability in rural communities and agricultural operations across the United States.

After careful consideration, EPA has denied the petition. A copy of the Agency's response, which consists of the letter to the petitioners and this document, is posted on the EPA petition website at https://www.epa.gov/assessing-and-managing-chemicals-under-tsca/tsca-section-21#reporting. The response, the petition (Ref. 1) and other information is available in the docket for this TSCA section 21 petition (see ADDRESSES ).

The denial is not based on lack of concern with PFAS. In fact, EPA's high concern for these chemicals is detailed in Unit III. of this document. EPA is leading the national efforts to understand PFAS and reduce PFAS risks to the public through implementation of its PFAS Action Plan and through active engagement and partnership with other federal agencies, states, tribes, industry groups, associations, local communities, and the public. Instead, EPA finds the petitioners have not met their burden under TSCA section 21, as explained in Unit IV.B. of this document.

In considering the petition within the statutory 90-day petition review period, EPA evaluated the information presented or referenced in the petition and considered that information in the context of the applicable authorities and requirements contained in TSCA sections 4, 21, and 26. Also, notwithstanding that the burden is on the petitioners to present “the facts which it is claimed establish that it is necessary” for EPA to initiate the rule or issue the order sought, EPA nonetheless also evaluated relevant information that was reasonably available to the Agency during the 90-day petition review period.

As detailed extensively in the units that follow, EPA finds the petitioners have not provided the facts necessary for the Agency to determine for each of the 54 PFAS that existing information and experience are insufficient and testing of such substance or mixture with respect to such effects is necessary to develop such information. These deficiencies, among other findings, are detailed in this document.

The petition does not set forth the facts necessary to demonstrate that there is “insufficient information and experience” for each of the 54 PFAS. The petitioners state, in part, “[f]or the 54 PFAS, the sufficiency of available information should be determined by comparing available data with the known adverse effects of other PFAS. The goal should be to conduct a scientifically sound assessment of each of the 54 chemicals for the critical toxic endpoints that have been identified in studies on PFOS, PFOA and other well-characterized studies” (Ref. 1, pg. 21). However, the petitioners do not provide evidence that they conducted an assessment to support a finding of insufficient information and experience.

The petitioners instead point to broad statements in the EPA PFAS Action Plan, such as “[t]here are many PFAS of potential concern to the public that may be found in the environment. Most of these PFAS lack sufficient toxicity data to inform our understanding of the potential for adverse human or ecological effects” (Ref. 3, pg. 31). The petitioners base the fate and transport studies they request on EPA's PFAS Action Plan, which the petitioners quote as stating “information for many PFAS sources, fate and transport, and human and ecological exposure is sparse, both spatially and temporally” (Ref. 3, pg. 31). However, the PFAS Action Plan broadly states only that such information for “many PFAS sources” is sparse; nowhere does it state or conclude that such information is sparse for each of the 54 PFAS the petitioners identify. To further demonstrate that the information and experience on the 54 PFAS is allegedly insufficient, the petitioners cite ATSDR's 2018 Toxicological Profile for perfluoroalkyls, which the petitioners acknowledge “identifies numerous critical data gaps for PFAS as a class ” (emphasis added). The ATSDR 2018 Toxicological Profile for perfluoroalkyls remains in draft form and discusses information on 14 perfluoroalkyl compounds, none of which are among the 54 the petitioners identify. Importantly, the ATSDR 2018 Toxicological Profile further states that “[t]he term `perfluoroalkyls' used throughout the toxicological profile is referring to these 14 compounds and the information may not be applicable to other perfluoroalkyl compounds” (Ref. 2, pg. 1). Despite this qualifying statement, the petitioners proceed to state without reference or additional explanation that “[t]he 54 substances covered by this petition fit this pattern” (Ref. 1, pg. 21). This extrapolation is fundamentally important to the petitioners' argument, yet there are no facts in the petition to support the statement. The petitioners are not clear as to what “pattern” the 54 PFAS fit, and no other sources are provided.

Absent any factual support in the petition, EPA finds that mere reference to these broad statements from the EPA PFAS Action Plan and ATSDR's 2018 Toxicological Profile for perfluoroalkyls does not provide the facts necessary for the Agency to determine there is insufficient information or experience for these 54 PFAS.

To further characterize this baseline deficiency, EPA performed a cursory search of public literature and databases for reasonably available information on any of the 54 PFAS identified by the petitioners. Representative findings of this cursory review are summarized as follows:

• On June 8, 1987, EPA issued a Final Test Rule for Fluoroalkenes (Ref. 14) requiring testing for certain health effects for four fluoroalkenes, two of which are among the 54 PFAS the petitioners identify: Hexafluoropropylene (CAS No. 116-15-4) and tetrafluoroethylene (CAS No. 116-14-3). The petitioners do not identify this test rule and the testing it required, nor do the petitioners explore and explain why the testing the rule ordered did not generate the health effects data the petitioners are now requesting.

• EPA's web-based CompTox Chemistry Dashboard integrates various types of data for curated substances linked to chemical structures, including physicochemical, environmental fate and transport, exposure, usage, in vivo toxicity, and in vitro bioassay data (Ref. 15). A query for some of the 54 PFAS in CompTox returned physical/chemical property and hazard data. For example, CompTox has published experimental averages for melting point, boiling point, water solubility, and vapor pressure, and some hazard data and sources for tetrafluoroethylene (CAS No. 116-14-3). CompTox also has published some hazard data for hexafluoropropylene (CAS No. 116-15-4) and perflouromethylperfluorovinyl ether (CAS No. 1187-93-5). Finally, some physical/chemical data for perfluoro (4-methyl-3, 6- dioxaoct-7-ene) sulfonyl fluoride (CAS No. 16090-14-5) are also readily available. The petitioners mention none of these data, nor have they provided the facts necessary to show that the information in CompTox is insufficient.

• ChemView provides the public access to reports and dataset information including data submitted to EPA, EPA Assessments and Actions, and data provided by other EPA Offices and federal organizations (Ref. 16). A query for each of the 54 PFAS in ChemView returned records for 17 of the 54 PFAS. For example, for perflouromethylperfluorovinyl ether (CAS No. 1187-93-5), a substantial risk report is available from DuPont Haskell Global Centers on reproduction/developmental toxicity screening tests (OECD 422/OPPTS 870.3650, one of the methods identified in the petitioners' testing program) in rats (Ref. 17). The petitioners do not mention this report, nor do they explain why the report fails to provide the data being sought. In this way, the petitioners once again have not provided the facts necessary to show that the information in ChemView is insufficient.

• Tetrafluoroethylene (CAS No. 116-14-3) is pre-registered under the Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) regulation. The European Chemicals Agency (ECHA) has compiled chemical/physical property data (partition coefficient, potential for bioaccumulation, etc.) for this PFAS. Hexafluoropropylene (CAS No. 116-15-4) is also pre-registered under REACH, and ECHA has compiled some chemical/physical property data for this PFAS. The petitioners mention none of these data, nor have they provided the facts necessary to show that this information is insufficient.

TSCA section 21 requires the petitioner, not EPA, to “set forth the facts which it is claimed establish that it is necessary to issue, amend, or repeal a rule under TSCA sections 4, 6, or 8, or an order under TSCA sections 4 or 5(e).” Because EPA, upon a cursory review, has been able to easily identify existing, reasonably available information not mentioned in the petition, the petitioners have failed in carrying their burden of setting forth facts which are necessary to demonstrate that there is insufficient information, thereby necessitating the requested action.

For one of the 54 PFAS, identified only as N1AF, the petitioners provide no structurally-descriptive chemical name, structure, or molecular formula. Absent such identifying information, the petitioners have not provided the facts necessary to determine whether there is “insufficient information or experience” for this chemical.

Because the petitioners are seeking tests for each of the 54 PFAS, the petitioners must set forth facts that establish it is necessary to pursue the rule or issue the order the petitioners seek under TSCA section 4. The petitioners must affirmatively demonstrate, through facts, that there is “insufficient information and experience” for each of the 54 PFAS. For the reasons described in this document, EPA finds the petition does not set forth facts necessary to demonstrate “insufficient information and experience” for each of the 54 PFAS, and has therefore not demonstrated that the rule or order requested is necessary.

The petitioners do not demonstrate “testing of such substance or mixture with respect to such effects is necessary to develop such information.” EPA finds that the petitioners failed to address ongoing testing and data collections for some of the 54 PFAS, thereby failing to set forth facts that are necessary to establish there is a need for the testing sought in the petition. This research may provide information that overlaps with testing the petitioners requested, which would render the information unnecessary under TSCA section 4(a)(1)(A)(i)(III). Testing, both planned and underway, on some of the 54 PFAS that the petitioners identify is described in this unit:

• Five of the 54 PFAS have been subjected to all Tier 1 in vitro, toxicokinetic, and clearance studies: Hepatotoxicity, developmental toxicity, immunotoxicity, mitochondrial toxicity, developmental neurotoxicity, endocrine disruption, general toxicity, intrinsic hepatic clearance, plasma protein binding (PPB), and renal reuptake. These studies are ongoing and results are expected by April 2021. Data are expected to be available via the PFAS Dashboard by the end of June 2021.

• An additional six of the 54 PFAS have results from some Tier 1 in vitro testing. Two have been included in systematic evidence mapping (SEM), a systematic review approach used to identify available data and characterize knowledge gaps.

• Three of the 54 PFAS have in vivo data identified from a non-EPA source.

In addition, the following studies are planned or in process by EPA's Office of Research and Development (ORD).

• ORD will test for nuclear receptor and stress gene responses of a PFAS library in HepG2 cells. This research will apply a high-throughput assay for transcription factor activation to screening the first and second PFAS screening sets totaling 150 samples. Additional samples may be added to meet developing needs. This assay platform contains known targets of several PFAS including the estrogen receptor and peroxisome proliferator-activator receptors, as well as many other potential targets. Well-studied PFAS such as PFOA and PFOS will be included to help put findings for data-poor chemicals in better context. Data sets will support development of read-across and category approaches for this class of chemicals.

• Bioactivity of PFAS as determined using gene expression and in vitro cellular pathology is another area of ongoing research at EPA. This research will apply broad-based high-content screening assays to characterize the bioactivity of a set of PFAS in multiple human cell types. The resulting dataset will contribute to an overall assessment of the effects of PFAS on important physiological functions that overlap with effects measured in the testing the petitioners requested.

• ORD will also conduct high-throughput in vitro testing of PFAS to fill data gaps and refine structural and mechanistic groupings. This project falls under the Human Health Testing/Toxicokinetics research area that will generate and analyze a large data set on ~150 PFAS using a variety of New Approach Methodologies (NAMs) in support of EPA's mission to manage and regulate PFAS. This research effort will add a dataset of NAMs testing results for 15 PFAS. Selection of these 15 chemicals will be driven by the initial analysis of the 150 chemicals and provide the ability to fill identified data gaps and potentially test hypotheses developed from the initial analysis. Testing of these 15 PFAS will include transcription factor activity profiling; estrogen-dependent cell proliferation; high-content, cellular phenotypic imaging; high-throughput transcriptomics; zebrafish embryo development; and developmental neurotoxicity. The results will support the overarching EPA PFAS research to: (1) Develop a hierarchical scheme of chemical structural categories that are enriched by NAM data; (2) Use categories as predefined neighborhoods to evaluate degree of concordance in NAM results within categories and across categories as a means to infer in vivo toxicity; (3) Predict categorization of larger PFAS inventory and read-across coverage; and (4) Recommend further in vivo testing for PFAS categories.

• In the FY2020 Further Consolidated Appropriations Act (Pub. L. 116-94), Congress appropriated funds for EPA to address research needs in support of designating PFAS as hazardous substances under CERCLA. The research needed to help support this designation include: Chemical and physical characteristics of PFAS; Toxicity and kinetic information; environmental prevalence; Manufacturing and use information; and Information on the regulatory status of PFAS. This ongoing research will add significantly to currently available hazard information for PFAS that could be used for this designation, as well as for risk assessment use broadly by Program Offices.

NDAA section 7351 amended TSCA section 8(a) to include a one-time reporting event of PFAS manufactured (including imported) in any year since January 1, 2011. TSCA section 8(a)(7) authorizes EPA to collect “[a]ll existing information concerning the environmental and health effects of such substance or mixture.” Under this rule, EPA may collect information that overlaps with some of the information requested by petitioners. A final TSCA section 8(a) rule for these PFAS must be issued by January 1, 2023, and EPA has initiated the relevant rulemaking process for the proposed rule that is expected to be issued in 2021.

The petitioners also call for an epidemiologic study consisting of 100,000 participants from communities exposed to PFAS-contaminated drinking water. A similar, multi-site health study is being implemented through the Centers for Disease Control and Prevention and ATSDR cooperative agreements. As ATSDR states, “[i]nformation learned from the multi-site study will help all communities in the U.S. with PFAS exposures, including those that were not part of the study.” The petitioners mention this multi-site study but provide no analysis of overlap or what testing might be duplicative with what is proposed and thus might not be necessary, whether based on community characteristics, demographics, specific PFAS or mixture, or levels of exposure.

For some of the 54 PFAS, only a degradant is detected in the Cape Fear River per the information provided by petitioners, not the parent chemical for which the petitioners have requested testing. The petitioners have not identified why it is necessary to test the parent chemicals and not the degradants actually detected in the Cape Fear River. For example, the petitioners do not demonstrate that testing of the parent chemical would identify effects relevant to the degradants.

The petitioners specifically identify and acknowledge that “5 of the 54 listed chemicals in this petition are also designated for testing in the Chemours North Carolina consent decree. These tests would not need to be replicated in response to this petition” (Ref. 1, pg. 30). EPA finds this avoidance of duplicative testing tacitly acknowledges that for these five PFAS, testing is not necessary to develop information on health or environmental effects. The petitioners' attempt to avoid duplicative testing as a result of the Chemours North Carolina consent decree, but no other duplicative testing, further emphasizes their failure to address readily available information concerning the other activities EPA has identified in this unit.

TSCA section 4(h)(1)(B)(ii) “encourage[s]” EPA to consider “the grouping of 2 or more chemical substances into scientifically appropriate categories in cases in which testing of a chemical substance would provide scientifically valid and useful information on other chemical substances in the category.” Accordingly, EPA is currently investigating ways to group similar PFAS by likeness into subcategories for purposes of research, data collection, hazard determinations, and other activities (Ref. 18). EPA and the National Toxicology Program collaborated to construct a PFAS screening library subset composed of 75 PFAS on a structural category basis and considerations such as structural diversity within a category, data availability, and read-across category-level weight ( e.g., value of substance for anchoring read-across trends within a category, serving as an analog); four of the 54 PFAS the petitioners identify are included in this subset (Ref. 19). The petitioners mention this effort, but incorrectly state that just two of the 54 PFAS the petitioners cover are included in the EPA testing (Ref. 1, pg. 22).

The petitioners take the opposite approach, requesting testing on each of the 54 PFAS individually. The petitioners fail to address why a class-based approach is not appropriate, while also indirectly referring to the efforts to address PFAS as a class. For example, the petitioners allege that conclusions about all 54 PFAS can be based on the ATSDR 2018 Toxicological Profile even though none of the 54 PFAS are addressed in the toxicological profile, and concedes that the ATSDR 2018 Toxicological Profile “identifies numerous critical data gaps for PFAS as a class ” (emphasis added). Additionally, among the references allegedly supporting the assertion that PFAS present serious health and environmental concerns, the petitioners cite a commentary entitled “Scientific Basis for Managing PFAS as a Chemical Class” (Ref. 20). This commentary acknowledges PFAS “demand a more efficient and effective approach” when it comes to testing and seeks to “provide scientific justification for why a class-based approach is appropriate and necessary for all PFAS.” Because the petitioners acknowledge the 54 PFAS share similarities with other members of the class, and the petitioners do not explore these similarities as a means of streamlining the extent of the testing requested, or to inform the petitioners' “tiered screening and testing process,” EPA finds the petitioners have not provided the facts necessary to determine, for each of the 54 PFAS, that “testing of such substance or mixture with respect to such effects is necessary to develop such information.” Therefore, they have not demonstrated that the rule or order they requested is necessary.

The petitioners also request that the National Academy of Sciences (NAS) oversee all aspects of the proposed testing program. EPA finds such an oversight arrangement is not within the scope of what a TSCA section 21 petitioner can request when seeking the initiation of a rule or the issuance of an order under TSCA section 4. Further, projects and studies must meet certain conditions for the NAS to accept private funding. As an example, NAS does not generally oversee studies where the study sponsor would have a direct financial interest in the outcome of the testing program. EPA is not in a position to require NAS to oversee the testing requested by the petitioners, and the petitioners provide no administrative or organizational procedures for implementation.

Attachment 2 of the petition divides the 54 PFAS at issue into Tier 1 substances “for which there is known human exposure based on detection in blood, food or drinking water,” and Tier 2 substances “for which human exposure is probable based on detection in environmental media.” However, the petitioners do not set forth facts showing that for all 40 PFAS it ranks as Tier 2 substances, “human exposure is probable based on detection in environmental media” or that “a strong inference of exposure can be drawn from their presence in surface water, stormwater, wastewater, sediment, groundwater, soil, private wells, and/or air emissions” (Ref. 1, pg. 19). The petitioners support their assertion that some of the Tier 2 PFAS were detected in environmental media with two studies (Ref. 21, 22); for nine of these, no other studies are provided for inclusion based on presence in environmental media (Ref. 1, Attachment 2). Three of these nine PFAS were not directly detected in the two studies. Further, for some of these nine PFAS, only degradant products were detected in the Cape Fear River; the parent compounds the petitioners specifically identify for testing were not. Thus, for nine of the 54 PFAS, the petitioners provide weak or no evidence for presence in environmental media upon which to base its “strong inference of exposure” assertion (Ref. 1, pg. 19).

EPA finds the petitioners have not evaluated the quality of the data they have provided or indicated how they conducted their searches, evaluated the quality of the sources, or indicated what gaps were located and then explained why the specific tests requested, as compared to others, would provide the data being sought. Such an evaluation is necessary for EPA to conduct the considerations under TSCA section 26(h).

TSCA section 4(h) requires that EPA reduce and replace the use of vertebrate animals in the testing of chemical substances under TSCA section 4. EPA must consider “as appropriate and to the extent practicable and scientifically justified, reasonably available existing information, including (i) Toxicity information; (ii) Computational toxicology and bioinformatics; and (iii) High-throughput screening methods and the prediction models of those methods.”

The testing program the petitioners request would require testing on vertebrates. For example, OCSPP Test Guidelines 850.2300, 870.3650, and 870.7800, among other test guidelines, require vertebrate testing. Due to the number of PFAS involved and tests requested, the petitioners' request would require testing on a large number of vertebrates. Yet, as previously discussed, the petition fails to provide reasonably available existing toxicity information on the 54 PFAS, and as such the petition has not provided sufficient facts for EPA to consider reasonably available existing information and encourage and facilitate the use of test methods that reduce or replace the use of vertebrates, group chemical substances as appropriate to reduce the use of vertebrates, and facilitate the formation of consortia for jointly conducted testing.

EPA denied the request to initiate a rule or issue an order under TSCA section 4 because the TSCA section 21 petition does not set forth the facts necessary for the Agency to determine for each of the 54 PFAS that existing information and experience are insufficient and testing of such substance or mixture with respect to such effects is necessary to develop such information. Therefore, the petitioners have not demonstrated that the rule or order they requested is necessary.

The following is a listing of the documents that are specifically referenced in this document. The docket includes these documents and other information considered by EPA, including documents that are referenced within the documents that are included in the docket, even if the referenced document is not physically located in the docket. For assistance in locating these other documents, please consult the technical person listed under FOR FURTHER INFORMATION CONTACT .

This is a summary of the Commission's document, Report No. 3165, released January 6, 2021. The full text of the Petitions can be accessed online via the Commission's Electronic Comment Filing System at: http://apps.fcc.gov/ecfs/. The Commission will not send a Congressional Review Act (CRA) submission to Congress or the Government Accountability Office pursuant to the CRA, 5 U.S.C. 801(a)(1)(A), because no rules are being adopted by the Commission.

Subject: Establishing a 5G Fund for Rural America, FCC 20-150, published at 85 FR 75770, November 25, 2020, in GN Docket No. 20-32. This document is being published pursuant to 47 CFR 1.429(e). See also 47 CFR 1.4(b)(1) and 1.429(f), (g).

Number of Petitions Filed: 5.