This is a summary of the Commission's Second Report and Order (Report and Order) in WC Docket No. 21-450, adopted on August 5, 2022 and released on August 8, 2022. Due to the COVID-19 pandemic, the Commission's headquarters will be closed to the general public until further notice. The full text of this document is available at the following internet address: https://www.fcc.gov/document/fcc-establishes-affordable-connectivity-outreach-grant-program-0 .

1. In this final rule, the Commission establishes the Outreach Grant Program, which will provide eligible partners grant funds to conduct outreach in support of the Affordable Connectivity Program. The Infrastructure Investment and Jobs Act (Infrastructure Act) appropriated $14.2 billion for the Affordable Connectivity Program, which provides qualifying low-income households discounts on broadband service and connected devices, and expressly authorizes the Commission to conduct outreach for the Affordable Connectivity Program, including providing grants to outreach partners. The Commission previously allocated up to $100 million of this budget for outreach, including an outreach grant program and outreach activities by the Commission's Consumer and Governmental Affairs Bureau (CGB) as authorized in the Infrastructure Act, to be spent over five years.

2. The Affordable Connectivity Program plays an integral role in helping to bridge the digital divide, which is an ongoing top priority for Congress and the Commission. To date, over 12 million low-income households participate in the Affordable Connectivity Program. However, a significant number of qualifying households have not yet enrolled in the Affordable Connectivity Program. The Commission previously recognized in the ACP Order, 87 FR 8346, February 14, 2022, that to achieve the program's full potential and reach as many eligible households as possible, households must be clearly informed of the program's existence, benefits, and eligibility qualifications, and how to apply. Through this Outreach Grant Program, the Commission seeks to enlist partners around the country to help inform ACP-eligible households about the program in their local communities, and to provide those partners with the funding and resources needed to increase participation among those Americans most in need of affordable connectivity.

3. In this final rule, the Commission discusses the goals and objectives of the Outreach Grant Program; provides examples of the types of outreach activities and expenses that may be considered for funding and types of eligible entities; allocates funding set-asides for specific types of grantees; establishes important safeguards to promote program integrity and guard against potential waste, fraud and abuse; adopts and implements regulations pertaining to grants in title 2, subtitle B, and title 47 of the Code of Federal Regulations; directs CGB, in coordination with the Office of General Counsel (OGC) and Office of the Managing Director (OMD) as appropriate, to develop, manage, and administer the Outreach Grant Program; provides guidance and regulatory requirements for the framework for the Outreach Grant Program; and addresses other requirements and administrative aspects of the Outreach Grant Program. While this final rule provides the necessary structure and guidelines for the Outreach Grant Program, consistent with its authority under applicable Federal statutes and regulations, additional details on specific grant program requirements and the application process will be provided in one or more Notices of Funding Opportunity (NOFOs) to be subsequently issued to solicit grant applications, in the awards to individual eligible grantees, and in orders and/or public notices issued by CGB in coordination with OMD, the Wireline Competition Bureau (WCB), and OGC, as appropriate.

4. The ACP Further Notice of Proposed Rulemaking (FNPRM), 87 FR 8385, February 14, 2022, explained that a number of Federal statutes and regulations govern Federal grant programs, including 2 CFR parts 25, 170, 175, 180, 182, and 200, and that appropriations riders may also impose additional conditions on Federal grant programs. Commenters did not specifically comment on the implementation of these provisions. Accordingly, the Outreach Grant Program will be structured in accordance with these regulations and any applicable statutes and Federal grant program conditions in appropriations riders. To fully implement the requirements of 2 CFR parts 25, 170, 175, 182 and 200 and any other non-self-executing requirements in 2 CFR (and other government-wide statutes and regulations applicable to grants and other awards of Federal financial assistance), the Commission grants CGB, in coordination with WCB, OGC, and OMD as appropriate, authority to adopt policies and procedures regarding such requirements through inclusion in the NOFO, inclusion in the terms and conditions of each grant, adoption, modification, and/or clarification of regulations, issuance of orders or public notices on delegated authority, and/or through publicly available instructions provided to applicants and/or grantees.

5. The Outreach Grant Program will provide funding to support eligible partners in their outreach efforts to increase awareness of the Affordable Connectivity Program among eligible households, and to encourage eligible households to participate in the Affordable Connectivity Program. The record, in particular, supports ACP outreach to diverse populations. For purposes of the Outreach Grant Program, diverse populations include people of color, persons with disabilities, persons who live in rural or Tribal areas, and others who have been historically underserved, marginalized, or adversely affected by persistent poverty or inequality.

6. Federal grant regulations require Federal awarding agencies to incorporate into their grant programs “clear goals and objectives that facilitate the delivery of meaningful results consistent with the Federal authorizing legislation of the program.” Federal grant regulations also require that the program design “align with the strategic goals and objectives within the Federal awarding agency's performance plan and should support the Federal awarding agency's performance measurement, management, and reporting as required by Part 6 of OMB Circular A-11” and “align with the Program Management Improvement Accountability Act (Pub. L. 114-264).”

7. The ACP FNPRM sought comment on the goal of the Outreach Grant Program. Pursuant to the Commission's Congressional authorization to conduct ACP outreach, the Commission establishes an Outreach Grant Program goal and related objectives to be consistent with the goals of the Affordable Connectivity Program, to reduce the digital divide and to promote awareness of and participation in the Affordable Connectivity Program, and the Commission's overall strategic goals and objectives that support bringing affordable broadband to low-income households.

8. The Commission adopts the goal of facilitating the promotion of the Affordable Connectivity Program to increase awareness of and participation in the program among eligible households. This goal is sound, supported by the record, and can be measured with appropriate data collected from grantees and ACP program data. Additionally, progress towards this goal advances the goals of the program to “promote awareness and participation in the Affordable Connectivity Program,” and to “reduce the digital divide for low-income consumers.” It also advances the Commission's overall strategic goals and objectives of facilitating access to and adoption of broadband internet by underserved, underrepresented, and low-income households. To meet this Outreach Grant Program goal, the Commission will provide funding to outreach partners to engage in targeted outreach to low-income and diverse households nationwide both to gauge existing levels of ACP awareness and to promote increased awareness of and participation in the program by eligible households.

9. To support the accomplishment of the goal of facilitating the promotion of the Affordable Connectivity Program to increase awareness of and participation in the program among eligible households, the Commission adopts three objectives for the Outreach Grant Program: (1) expand and support diverse and impactful outreach efforts nationwide to reach eligible Affordable Connectivity Program households, including, but not limited to, people of color, persons with disabilities, persons who live in rural or Tribal areas, and others who are or have been historically underserved, marginalized, or adversely affected by persistent poverty or inequality; (2) strengthen outreach partners nationwide by empowering them to mobilize people and organizations to help raise awareness about the Affordable Connectivity Program; and (3) increase enrollment in the Affordable Connectivity Program, particularly in areas served by the outreach grants, by underrepresented, underserved, and low-income households. These objectives are consistent with the authorizing language in the Infrastructure Act and are also consistent with the record and in alignment with the Commission's strategic goals and objectives identified in this document.

10. The first objective—expanding and supporting diverse and impactful outreach efforts nationwide—implements the Commission's strategic goals of facilitating access to and adoption of affordable broadband internet service and promoting affordable access to reliable broadband networks by diverse populations in underserved areas including rural, high-cost, and insular areas. This objective is also supported by the record—many commenters highlight the need for ACP outreach, and, in particular, for outreach to diverse and underserved groups across diverse geographic regions. To accomplish this objective, the Outreach Grant Program will use eligibility criteria that encourage program participation by entities that are capable of meeting the goal of the program and will provide funding to support ACP outreach by a broad range of eligible outreach partners.

11. The second objective—strengthen outreach partners—also implements the Commission's strategic goal of increasing broadband adoption and access and the strategic objective of communicating information about FCC programs and policies to help increase adoption of affordable broadband. It further implements the goals of the Affordable Connectivity Program to promote awareness of and participation in the program for eligible households. To accomplish this objective, the Outreach Grant Program will provide funding for outreach and will also provide prospective applicants technical assistance on the Outreach Grant Program application requirements and Outreach Grant Program rules and requirements and provide grantees with programmatic training and standardized outreach materials.

12. The Commission's third objective under the Outreach Grant Program—increasing enrollment in the Affordable Connectivity Program by qualifying underrepresented, underserved, and low-income households—implements the Commission's strategic objectives of facilitating access to and adoption of broadband internet service, including by low-income and underserved populations, and the Affordable Connectivity Program's goal of reducing the digital divide. The Outreach Grant Program can facilitate universal access to affordable broadband internet service by raising awareness of and encouraging participation in the Affordable Connectivity Program among eligible households. To accomplish this objective, the Outreach Grant Program will provide funding to facilitate outreach by eligible partners and will encourage participation of partners who are capable of reaching underrepresented, underserved, and low-income households and helping them to enroll in the Affordable Connectivity Program.

13. Consistent with Federal grant regulations, and the delegations of authority in this final rule, the Commission directs CGB, in consultation with WCB and the Office of Economics and Analytics (OEA), to develop meaningful performance measures to evaluate progress towards this goal and to collect the necessary information from grant recipients, subrecipients, and Universal Service Administrative Company (USAC or ACP Administrator) to measure progress towards this goal. Further the Commission instructs CGB, WCB, and USAC to explore whether and how outreach activities could be linked to specific enrollments, which could help measure the success of specific outreach efforts. The Commission will use data collected as part of the Outreach Grant Program as an indicator to measure Affordable Connectivity Program awareness among eligible households, which will be necessary to monitor progress toward the goal established in this final rule. Accordingly, the Commission directs CGB, in coordination with OEA and WCB, to use the data collected from grant recipients, which may include consumer surveys, research efforts, and feedback sought from “our state, community and non-profit partners helping to educate consumers on the [ACP] application process” to measure progress toward the goal the Commission has established for the Outreach Grant Program.

14. In authorizing the Commission to conduct outreach, Congress recognized that multiple forms of outreach are appropriate to ensure that eligible households are aware of and encouraged to participate in the Affordable Connectivity Program. However, the Infrastructure Act does not specify the types of outreach activities that are fundable through the Outreach Grant Program. Accordingly, in the ACP FNPRM, the Commission sought comment on the types of outreach activities that should be eligible for outreach grant funds, and the Commission now provides examples of the types of outreach activities that may be funded through authorized grants. Any NOFO issued for the Outreach Grant Program will provide further guidance on allowable activities and costs consistent with the goal and objectives of the Outreach Grant Program and the applicable authority under Federal statutes and regulations governing Federal grant programs.

15. Based on the Commission's careful review of the record, and CGB's outreach experience, the Commission finds that a wide range of activities including, but not limited to, in-person events, literature campaigns, digital campaigns, and paid media campaigns could provide meaningful, effective Affordable Connectivity Program outreach tailored to targeted communities. Accordingly, in this final rule the Commission does not prescribe a comprehensive list of fundable outreach activities for the Outreach Grant Program. Instead, the Commission more broadly directs that all grant-funded outreach activities must be designed to support the stated goal and one or more of the stated objectives of the Outreach Grant Program. Further information will be provided as part of any NOFO issued by CGB. Consistent with the delegations of authority in this final rule, the Commission directs CGB to determine whether certain types of outreach activities should be prioritized based on a reasoned evaluation of which outreach activities will best meet the Outreach Grant Program goal and objectives, except as otherwise directed herein.

16. The record supports funding a wide range of outreach activities to ensure that grant program participants have the flexibility to tailor outreach to the specific community they are targeting. For example, Common Sense urges the Commission to give grantees flexibility to use a variety of approaches because “no single outreach method will be appropriate for all communities” given that the digital divide impacts a diverse range of communities that are geographically distinct, use a variety of languages and communication media, trust different organizations, and have varying levels of technological fluency. Alaska Federation of Natives (AFN) recommends that the Commission give grantees “maximum flexibility to conduct outreach activities including television and radio, social media, local newspapers (still common in rural communities), or community events” to accommodate the needs of and most effective methods of reaching out to different communities. Similarly, the San Diego Association of Governments (SANDAG) states that “[c]ommunity-focused outreach and engagement strategies are highly dependent on a community's political, social, and economic conditions” and recommends that the Commission “should provide the flexibility for grantees to design community outreach and engagement based on localized community needs.” The Commission agrees that funding a wide range of outreach activities through the Outreach Grant Program would best provide grantees flexibility to conduct outreach tailored to the specific community they are targeting and allow us to direct funding in a manner that optimizes its ability to meet the programs goals and objectives.

17. Examples of the types of activities that commenters ask the Commission to fund through the grant program include, but are not limited to, in-person and virtual outreach events and campaigns, text messaging, phone banking, social media campaigns, literature campaigns, and paid media campaigns. Specifically, the National Hispanic Media Coalition (NHMC) recommends that the Commission “prioritize investment in trusted messengers, culturally-relevant programming, and in-language materials.” Based on its experience implementing other federally funded outreach campaigns, the National Urban League recommends that “community events, mailers, radio and television broadcasts, paid advertisements, ethnic media, newsletters, social media, and other outreach targeted to the populations covered in the [Infrastructure Act]” be funded through the Outreach Grant Program. Several commenters support funding paid media campaigns such as public service announcements, radio and television ads, and billboards, particularly in communities most impacted by the digital divide. Other commenters emphasize the importance of traditional outreach campaigns, both virtual or in-person, including, but not limited to, community events, workshops, mailers, newsletters, phone banks, street teams/canvassers, and door knocking. Commenters also support funding social media and digital outreach, such as social media advertisements and text messaging campaigns. These types of activities are tested and proven in their ability to reach diverse and targeted audiences and may therefore be considered an allowable use of grant funds in any NOFO consideration.

18. The Commission recognizes the importance of ensuring that grant-funded ACP outreach is accessible to all diverse, eligible low-income households. Several commenters emphasize the value of multilingual outreach, such as making program information available in multiple languages and ensuring outreach staff are prepared to communicate in languages other than English. The ACP rules also require that service provider ACP outreach and other communications be accessible to individuals with disabilities. The Commission agrees with commenters that outreach in languages other than English is important and also continues to find that there is a need for ACP outreach to be accessible to individuals with disabilities. Accordingly, the Commission allows funding for multilingual and accessible outreach, and it strongly encourages grantees to conduct grant-funded outreach in the languages spoken in the areas and communities that they are targeting and to also ensure that the grant-funded outreach is accessible to individuals with disabilities.

19. In addition, commenters emphasize the importance of providing ACP application assistance to eligible consumers in connection with fundable outreach activities. The Commission agrees that in-person application assistance would help many potential applicants who may experience difficulty completing and submitting an application on their own, and specifically finds that grant funds may be used for this purpose. The Commission notes that some commenters advocate for funding that would support the ability to provide potential applicants remote assistance with completing and submitting their applications. However, as explained in the ACP Order, to protect the program's integrity, the Commission requires ACP applicants to be physically present with the individual providing application assistance to complete, sign, and certify their application. This requirement provides an important safeguard against waste, fraud, and abuse by ensuring that the applicant is actually the person who signs and submits the application and has reviewed and acknowledged the required applicant certifications. The Commission therefore declines to provide grant funds for remote assistance with completing and submitting ACP applications.

20. Although access to the National Verifier can facilitate ACP enrollment by allowing direct assistance to low-income households with completing and submitting an application in the National Verifier, the Commission declines to provide grantees access to the National Verifier as part of this grant program. For program integrity and administrative reasons, access to the National Verifier is limited to service providers and certain neutral, trusted, third-party entities ( e.g., governmental entities and their partners). Further, grantees are able to conduct meaningful, effective ACP outreach and provide application assistance without having direct access to the National Verifier. However, the Commission separately has two limited scope and duration pilot initiatives through which some outreach grantees that are also neutral, trusted third party entities (such as state, regional, and local governments, schools or school districts, state and local housing authorities, Tribally Designated Housing Entities, associations representing multiple Tribally Designated Housing Entities, or other state, regional, and local government entities or public housing authorities and their partners, as permitted pursuant to pilot rules), may be able to obtain direct access to the National Verifier for purposes of helping eligible consumers apply for the Affordable Connectivity Program directly in the National Verifier.

21. Consistent with Federal grant regulations, all outreach expenses funded through this grant program must be necessary and reasonable for the performance of the award. Many parties commented on the types of outreach expenses for which grant funds could be used. For example, commenters advocate for the ability to use outreach grant funds for a broad variety of costs. Specifically, commenters advocate for funding the following types of costs: grant application, compliance, and planning costs; advertising costs ( e.g., traditional advertising, social media, and text messaging campaigns); indirect costs; travel costs for outreach ( e.g., mileage, gas, and related travel incidentals); grant administration costs ( e.g., reporting, evaluation, auditing); percentage of program costs for facilities to cover overhead; outreach personnel costs; costs for hosting outreach events ( e.g., supplies, facility costs, incentives, and food and refreshments for households attending outreach events); costs to create and distribute materials such as toolkits, fliers, or train-the-trainer guides that enable other organizations to promote the Affordable Connectivity Program; costs for technology ( e.g., tablets, laptop computers, and printers for use at outreach events) to support enrollment; costs to create, produce, and disseminate consumer outreach materials such as mailers and posters; and costs to translate and interpret ACP consumer outreach materials.

22. Given the broad range of expenses that could be necessary and reasonable to provide meaningful, effective outreach to eligible households, the Commission declines to prescribe in this final rule a comprehensive list of allowable outreach expenses, but reiterate that all outreach expenses funded through this grant program must be necessary and reasonable for the performance of the award. To promote fiscal responsibility and ensure that the vast majority of the grant funding is targeted towards outreach activities, moreover, grants will be subject to a five percent cap on management and administrative expenses per individual award. In addition, the Commission makes clear that the grant funding is intended for eligible costs of ACP outreach for which applicants do not already have or expect to receive other funding. Grant funds may not be used to replace (supplant) funds that applicants have already obtained or expect to receive for the same purpose. The Commission directs CGB, in consultation with WCB, OMD, and OGC, to identify allowable and unallowable outreach costs for the grant program, subject to the necessary and reasonable for the performance of the award standard applicable to Federal grants, and to provide this information in any NOFO issued for the grant program. In making these determinations, CGB shall consider the goal and objectives and available funding for the Outreach Grant Program, the need for fiscal responsibility, and the restrictions on fundable costs in the applicable statutes and regulations governing Federal grants. CGB shall have the authority to make revisions to the types of allowable costs during the grant program and may also cap certain types of expenses. The Commission further notes that Federal grant regulations, which it has adopted herein for this grant program, prohibit the use of Federal funds for certain costs.

23. The Commission takes seriously its obligation to guard against waste, fraud, and abuse in the use of Federal funds. To promote the integrity of the Outreach Grant Program and the Affordable Connectivity Program and to protect consumer choice among service providers, the Commission adopts several important program safeguards. In addition, costs funded through the outreach grants are subject to principles, restrictions, and limitations under the statutes and regulations applicable to Federal grant programs. For example, award recipients are prohibited from using grant funds for entertainment or to purchase alcohol, contracting with the enemy, and purchasing telecommunications and video surveillance services or equipment provided by prohibited companies.

24. The Commission requires that all grantees not favor any particular service provider in performing outreach activities funded by this Outreach Grant Program. Service providers stand to benefit financially from the enrollment of additional eligible households in the Affordable Connectivity Program. Accordingly, it would be inappropriate to use Outreach Grant Program dollars in a manner intended to specifically increase a particular provider's program enrollment. Additionally, requiring grantees to maintain neutrality among service providers will protect eligible households' right to choose their ACP provider and the type of broadband service that best fits their needs. Neutrality with respect to participating providers is similarly a requirement for the ACP Navigator and Your Home, Your Internet Pilots that were established in the ACP Order and the Your Home, Your Internet Pilot Order, published elsewhere in this issue of the Federal Register , respectively, and these same concerns equally apply in the context of the Outreach Grant Program.

25. Consistent with this outreach neutrality requirement, grantees may not direct, steer, incentivize or otherwise encourage eligible households to enroll with a particular ACP provider or one of a specific group of ACP providers (including, but not limited to, broadband industry groups such as trade associations) when conducting grant-funded outreach activities, and grantees must make clear that eligible households may enroll with the ACP provider of their choice. In addition, grantees may not use service provider-branded items such as outreach materials, gifts, or incentives when conducting grant-funded outreach activities. Grantees also may not offer or provide consumers gifts or incentives provided by service providers when conducting grant-funded outreach activities. Such gifts and incentives could compromise the grantee's neutrality with respect to ACP service providers and could also improperly influence eligible households' choice of provider. Furthermore, grantees may not otherwise accept funding in any form, including in-kind contributions, from a participating provider or a specific group of participating providers (including, but not limited to, broadband industry groups such as trade associations) for the purpose of conducting grant-funded outreach activities. The Commission recognizes that it may be beneficial in some instances to have service provider representatives in attendance at grant-funded outreach events to provide eligible households information on the available service offerings to which they may apply their ACP benefit. The Commission does not prohibit this, provided that all ACP participating providers that provide service in the area where the outreach is conducted have the same opportunity to attend and provide information on their services to which the ACP benefit can be applied. The Commission also does not prohibit including information in connection with grant-funded outreach on how to find an ACP service provider. Accordingly, outreach funded through the Outreach Grant Program can direct eligible households to the Companies Near Me Tool and can include a list of all providers serving the areas where the outreach is performed. The Commission makes clear that this service provider neutrality requirement does not preclude grantees from otherwise collaborating with state agencies, public interest groups, and non-profit organizations to carry out public awareness campaigns that highlight the value and benefits of broadband internet access service and the existence of the Affordable Connectivity Program, as required under the Infrastructure Act.

26. The Commission also prohibits entities conducting outreach funded through the Outreach Grant Program from providing any form of compensation to individuals engaged in grant-funded outreach activities based on the number of ACP applications or enrollments resulting from their grant-funded outreach activities. The Commission's rules for the Lifeline program similarly prohibit participating providers from offering or providing commission or other compensation to enrollment representatives or their direct supervisors that is based on the number of consumers who applied for or are enrolled in Lifeline with that particular provider. The ACP rules also prohibit participating providers from offering or providing to enrollment representatives, their direct supervisors, or entities operating on behalf of a participating provider, any form of compensation that is based on the number of ACP applications or enrollments with that provider, revenues the provider receives or expects to receive through the Affordable Connectivity Program, or any other compensation based on ACP applications, enrollments, or other revenues. Based on the Commission's experience administering the Lifeline program and the Affordable Connectivity Program, it finds that allowing grantees to provide such compensation in connection with grant-funded outreach activities could compromise the integrity of the program and its goals. Therefore, the Commission prohibits grantees from providing compensation to their personnel, representatives, or others acting on their behalf based on the number of ACP enrollments or applications submitted in connection with outreach activities funded under the Outreach Grant Program.

27. Consistent with Federal regulations that the Commission has made applicable to this grant program, it notes that grantees may not “earn or keep any profit resulting from” an Outreach Grant Program award. For example, a grantee may not accept or receive payment or other compensation (other than funded, allowable outreach expenses) in exchange for hosting an outreach event or providing application assistance to an ACP applicant at a specific site as part of the Outreach Grant Program. The Commission also notes that grantees may not charge low-income households a fee for educating them about or providing them with assistance in submitting an ACP application. This ensures that outreach grant partners do not make a profit from or otherwise financially benefit from conducting ACP outreach through the Outreach Grant Program.

28. To further promote program integrity, the Commission prohibits the use of grant funds to support or obtain gifts or incentives to offer or provide to encourage consumers to learn about, apply for, or enroll in the Affordable Connectivity Program. At least one commenter advocates for the ability to use grant funds to provide incentives to encourage consumers to learn about and apply for the Affordable Connectivity Program. The Commission finds that gifts and incentives supported by or offered when conducting grant-funded outreach activities may induce households to submit an ACP application that they may not have otherwise submitted primarily to obtain the gift or incentive or may encourage an ACP participating household to attempt multiple enrollments to obtain the gift or incentive even though the ACP benefit is limited to one per household. These outcomes may result in waste, fraud, and abuse, and thus the Commission prohibits the use of grant funds for these practices.

29. Outreach by a range of entities is critical to maximizing the impact of the Affordable Connectivity Program. While the Infrastructure Act authorizes the Commission to provide grants to outreach partners, it does not specify the types of entities that qualify as outreach partners. In the following, the Commission provides examples of the types of entities that may be eligible to participate in the Outreach Grant Program as grantees and subrecipients. The Commission encourages entities of all types and diverse organizations, including organizations serving, led, and/or owned by persons of color, persons with disabilities, persons who live in rural or Tribal areas, and others who are or have been historically underserved, marginalized, or adversely affected by persistent poverty or inequality, to submit applications for the Outreach Grant Program once a NOFO is released. Like commenters, the Commission is also mindful of the importance of equitable outreach efforts as it works to reach underserved communities most impacted by the digital divide, and it reminds prospective applicants of the Federal grant requirement to “take all necessary affirmative steps to assure that minority businesses, women's business enterprises, and labor surplus area firms are used when possible.” The Commission also encourages entities participating in the Commission's ACP Navigator and Your Home, Your Internet Pilot Programs, through which limited trusted entities may be granted access to the National Verifier to assist eligible households to complete and submit the ACP application, to apply for outreach grants to enhance their participation in those pilot programs.

30. The Infrastructure Act authorizes the Commission to provide grants to outreach partners to encourage eligible households to enroll in the Affordable Connectivity Program. At a minimum, then, outreach partners must be capable of conducting ACP outreach, that is, communicating or engaging with eligible low-income populations to inform or educate them about the Affordable Connectivity Program, to increase their awareness of the program, and to encourage or assist them to apply for the program. Moreover, eligible entities must be able to satisfy all legal requirements applicable to Federal grantees. For instance, to be eligible, an entity must be able to comply with Federal grant regulations adopted by the Commission, to obtain and report an FCC Registration Number (FRN), and to register with, and maintain an active registration with, the System for Award Management (SAM). Additionally, entities seeking to participate must satisfy statutory requirements, such as those restricting grant eligibility of entities indebted to the United States. Accordingly, the Outreach Grant Program will be open to entities capable of (a) directly or indirectly (through subrecipients) conducting outreach to increase awareness of and to encourage or assist with applying for the Affordable Connectivity Program; and (b) complying with all applicable policies and rules adopted herein, including the adopted requirements of 2 CFR part 200, any policies and rules that may be subsequently adopted on delegated authority by CGB to implement the Outreach Grant Program, and any other applicable grant-related statutes and regulations. The Commission strongly encourages eligible entities interested in applying for the Outreach Grant Program to familiarize themselves with regulatory and statutory requirements by closely studying applicable grant regulations and the relevant NOFO.

31. The ACP FNPRM sought comment on the types of entities that should be deemed eligible to apply for outreach grant funds and proposed, at a minimum, that non-profit organizations and trusted community organizations be eligible. Commenters support making the Outreach Grant Program open to a wide range of public and non-profit entities. The Commission agrees that the Outreach Grant Program should generally be open to a variety of entities to encourage participation from a diverse range of outreach partners, in terms of type and size, and to maximize the reach and impact of the grant program. Consistent with the record and the goal and objectives of the grant program, and subject to the basic eligibility criteria in the document, governmental and non-governmental entities are eligible for the grant program. Based on the Commission's review of the record, the types of entities eligible to participate in the Outreach Grant Program include, but are not limited to:

• Tribal governments and subdivisions thereof, as well as tribal organizations;

• State governments and subdivisions thereof (including the District of Columbia and U.S. Territories);

• Local governments and subdivisions thereof (including county, borough, municipality, city, town, township, parish, local public authority, special district, intrastate district, council of governments, and agencies or instrumentalities of multi-regional or intra-state or local government);

• Public housing authorities;

• Social service providers ( e.g., food banks, community transportation, childcare);

• Education organizations, such as schools and other institutions of higher education;

• Workforce development training organizations;

• Non-profit organizations;

• Community-based organizations (including faith-based organizations and social service organizations);

• Community anchor institutions ( e.g., healthcare providers and healthcare organizations and libraries and library consortia);

• Public service organizations; and

• Consortia of the entities listed in the document.

Depending on the outreach target or audience for a particular NOFO and where appropriate to meet a specific program goal or objective, CGB is authorized to modify, expand, or limit the types of entities that may be eligible to receive grant funds under a particular funding opportunity in this grant program.

32. The ACP FNPRM asked whether the eligibility of non-profit organizations should be limited to organizations with 501(c)(3) status. This refers to section 501(c)(3) of the Internal Revenue Code, under which an organization will be tax-exempt if it is “organized and operated exclusively for exempt purposes set forth in section 501(c)(3), and none of its earnings may inure to any private shareholder or individual.” The exempt purposes are charitable (including “relief of the poor, the distressed, or the underprivileged” and “eliminating prejudice and discrimination”), religious, educational, scientific, literary, testing for public safety, fostering national or international amateur sports competition, and preventing cruelty to children or animals. To qualify for 501(c)(3) status, an organization must pass “organizational” and “operational” tests, and must not be an “action organization,” meaning that it “may not attempt to influence legislation as a substantial part of its activities and it may not participate in any campaign activity for or against political candidates.”

33. Several commenters suggest limiting eligibility for non-profit organizations to those with 501(c)(3) status. The National Digital Inclusion Alliance (NDIA), for instance, “urges the Commission to consider only nonprofits with 501(c)(3) status as eligible grantees under the program.” Likewise, the Hawaii Broadband and Digital Equity Office recommends giving award preference to 501(c)(3) non-profit organizations but allowing non-profit organizations who lack that status to be subgrantees. In contrast, the National Lifeline Association (NaLA) contends that the Commission should “avoid categorical limitations on the types of entities that can participate” and asserts that there is “no reason to require grant recipients to be charitable organizations with 501(c)(3) status.”

34. The Commission declines to limit the eligibility of non-profits to organizations with 501(c)(3) status. As NDIA acknowledges, this tax status has limited relevance to whether an applicant can perform effective ACP outreach. The commenters who suggest the 501(c)(3) limitation do not explain why it is necessary or explain how this limitation would support the purposes of the Outreach Grant Program. Making 501(c)(3) status an eligibility criterion could exclude organizations that are capable of engaging in effective outreach efforts but are outside the scope of the 501(c)(3) category, such as social welfare organizations and civic leagues. The Commission also notes that 501(c)(3) status is not necessary to evaluate an applicant's general eligibility to receive Federal grants or ability to comply with the applicable Federal grant regulations—Federal grant regulations require a robust risk assessment of all Federal grant applicants. Further, numerous other Federal grants are open to non-profit organizations that do not have 501(c)(3) status with the Internal Revenue Service. For these reasons, the Commission does not limit the eligibility of non-profits to organizations with 501(c)(3) status, but it does authorize CGB to require an applicant to provide proof of non-profit status as appropriate.

35. The Commission also declines to categorically exclude for-profit organizations from participation in the grant program. The California Emerging Technology Fund (CETF) argues that private, for-profit companies should be ineligible entities for outreach grants. In contrast, Centri Tech and the U.S. Chamber of Commerce advocate eligibility for both non-profit and for-profit entities, like minority businesses. The Commission agrees that there may be some for-profit entities that could provide meaningful outreach, such as healthcare providers or minority businesses, and CETF does not identify any reason to exclude such entities at the eligibility stage. The Commission reiterates, however, that grantees may not make a profit from or otherwise financially benefit from conducting ACP Outreach through the Outreach Grant Program.

36. Although the illustrative list of eligible entity types incorporates a wide range of organizations, to promote the integrity of the grant program, the Commission concludes that broadband providers and their subsidiaries, affiliates, representatives, contractors, and agents will not be eligible to participate in the Outreach Grant Program or receive awards, either as grantees, pass-through entities, or subrecipients. Given that broadband providers individually benefit from customer enrollments in the Affordable Connectivity Program, awarding grant funds to help broadband providers increase awareness of and enrollments in the Affordable Connectivity Program presents a significant conflict of interest and would not be a fiscally responsible use of Federal funds. Excluding broadband providers from receiving grant awards would not hinder the goal or objectives of the grant program. Broadband providers that participate in the Affordable Connectivity Program are already obligated by statute and regulation to engage in ACP outreach efforts and should not receive Federal funds to accomplish these obligations. Additionally, because broadband providers benefit financially from ACP enrollment, they already have sufficient incentive to engage in outreach.

37. Further, the Commission is not persuaded by NaLA that it should permit broadband industry trade associations to receive grant awards. Although the Commission agrees with NaLA that its approach to program eligibility should be “inclusive,” broadband provider trade associations present conflict of interest concerns that charitable non-profit organizations, for instance, do not. Just as the Commission finds that permitting broadband providers to participate in the Outreach Grant Program presents a conflict of interest, it finds that the same conflict of interest is inherent where an industry association or trade association made up of or representing the same broadband providers may be seeking government funds to increase its members' consumer enrollments in the Affordable Connectivity Program. Therefore, the Commission also prohibits broadband industry groups and trade associations that represent broadband providers from receiving awards through the Outreach Grant Program, either as grantees, pass-through entities, or subrecipients.

38. Additionally, consistent with the Federal grant regulations, entities that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities will be ineligible for participation in the Outreach Grant Program. The Commission currently has pending a notice of proposed rulemaking to adopt and implement the Office of Management and Budget (OMB) Guidelines for suspension and debarment (non-procurement) in 2 CFR part 180, and it asked for comment about the implementation of that part in the ACP FNPRM. Commenters did not address suspension and debarment procedures in response to the ACP FNPRM. To mitigate the potential for waste, fraud, and abuse in the grant program, the Commission determines here that those rules, should they be adopted, will apply to the Outreach Grant Program. Additionally, certain entities may be ineligible by statute. For example, 501(c)(4) non-profit organizations that engage in lobbying activities are ineligible for Federal grants, as are organizations that are indebted to the United States and have judgment liens filed against them.

39. CGB has extensive experience and expertise in conducting outreach and working with a range of outreach partners, including most recently for the Affordable Connectivity Program and the Emergency Broadband Benefit Program (EBB Program). The Commission directs CGB to develop, administer, and manage the Outreach Grant Program in compliance with the Federal laws and regulations applicable to Federal grant programs, and consistent with the program goal and objectives and requirements the Commission establishes in this final rule. The Commission modifies §§ 0.11, 0.141, and 0.231 of the Commission's rules to reflect CGB's and OMD's additional responsibilities for the grant program and related delegations of authority. In carrying out these delegated functions, CGB shall consult with WCB, OMD, and OGC as appropriate to ensure that the grant program is in compliance with the applicable statutes and regulations for Federal grant programs and the Affordable Connectivity Program, and to ensure that the grant program is otherwise meeting the program objectives, goals and requirements outlined in this final rule. The Commission further directs CGB, in coordination with OMD, OEA, and OGC as needed, to engage with the National Telecommunications and Information Administration, and other Federal agencies that administer broadband funding programs to promote information sharing and collaboration across broadband-related investments across the Federal Government and to avoid unnecessary duplication.

40. Although the Infrastructure Act authorizes the Commission to issue grants to outreach partners, the Infrastructure Act does not specify a budget for these grants, leaving the Commission with authority to determine how much of the overall ACP appropriation should be expended on this grant program. In the ACP Order, the Commission established a budget of up to $100 million for all outreach for the Affordable Connectivity Program, which includes the Outreach Grant Program as well as the Commission's own non-grant outreach efforts permitted by the Infrastructure Act. This budget recognizes the need for extensive outreach for the Affordable Connectivity Program, while also leaving ample funds from the total $14.2 billion ACP budget to provide the ACP benefit to as many eligible households as possible for as long as possible. As explained in the ACP Order, the $100 million outreach budget reflects the Commission's consideration of the estimates for the costs of Commission outreach for the Affordable Connectivity Program and the Commission's costs for Digital Television Transition outreach (which included broad paid media campaigns).

41. The allocation of the $100 million budget for ACP outreach takes into consideration the costs of the Commission's outreach for the Digital Television Transition and EBB Program and comments in the record concerning the costs of outreach activities. This funding allocation will enable CGB to provide grant awards to respond to the need for extensive, meaningful outreach by numerous, diverse eligible outreach partners, while also enabling CGB to conduct its own outreach as authorized in the Infrastructure Act. The Commission makes clear that CGB is not required to spend this full amount. CGB is authorized, in coordination with OMD, to decide if and when to reallocate any remaining unused funds from individual outreach grants for any outreach allowed under the statute or none at all.

42. The Commission directs CGB to designate up to $60 million of the ACP outreach budget for competitive allocation to eligible entities. Of the $60 million set-aside for competitive allocation to eligible entities, $27 million will be reserved for States and U.S. Territories, with a minimum allocation to grantees in each State and U.S. Territory for ACP outreach activities, consistent with this final rule and the program's goal and objectives. In establishing the minimum funding allocation to each State and U.S. Territory, CGB shall allocate an equal amount of funding for each state, the District of Columbia, and Puerto Rico, but may allocate a lesser minimum amount to the remaining U.S. Territories. To facilitate coordination, States and U.S. Territories may choose, but will not be required, to establish a single point of contact to, among other things, coordinate among entities within the State or U.S. Territory that have relevant outreach responsibilities related to implementing the Outreach Grant Program. The Commission further directs CGB to designate a minimum of $10 million of the ACP outreach budget for competitive allocation to eligible Tribal governments and Tribal organizations, including Tribally Designated Housing Entities, to be used specifically for ACP outreach to persons who live on qualifying Tribal lands as defined in § 54.1800(s) of the Affordable Connectivity Program rules.

43. To maximize the impact of the dollars allocated for ACP outreach, the Commission seeks to build upon existing initiatives that it has already determined will support the goal and objectives established in this final rule to increase awareness of and participation in the Affordable Connectivity Program; specifically, the ACP Navigator Pilot and Your Home, Your Internet Pilot Programs. Appropriately targeted outreach funding could further the scope of outreach and enrollment activities conducted by participants in these pilots, which in turn would promote the success of these pilots and provide the Commission with valuable information on what is needed to increase awareness and aid in the enrollment of targeted populations, including households that participate in Federal Public Housing Assistance Programs. In establishing the parameters of both pilots, the Commission will inform potential participants that are eligible for grants of its intent to make available outreach grant funds to support their pilot program activities, and will encourage and enable eligible entities participating in one or both of these pilots to apply for Outreach Grant Program funding. Therefore, the Commission directs CGB to set aside up to $5 million each, for a total of up to $10 million of the ACP outreach budget, for outreach grants specifically for eligible entities participating in either or both the ACP Navigator or Your Home, Your Internet Pilot Programs. The Commission makes clear, however, that CGB is not required to award this full amount to pilot participants. The Commission also makes clear that while it directs CGB to set aside a specific funding allocation solely for grants to eligible entities participating in Your Home, Your Internet or the ACP Navigator Pilot, eligible entities participating in both or either of these pilots are not limited to applying for that targeted funding, and may apply for a grant in any funding opportunity for which they qualify.

44. The Commission expects that the allocated budget established today for the Outreach Grant Program will support extensive, meaningful outreach by numerous eligible outreach partners. The Commission acknowledges that certain commenters advocate for a total budget larger than $100 million for outreach grants and other outreach. However, the Commission declines to increase this budget. The $100 million budget the Commission set for all ACP outreach reflects the critical need for extensive ACP outreach and the fact that the Affordable Connectivity Program has a limited budget, while also ensuring that ample funding remains for providing broadband and device discounts to eligible ACP households for as long as possible. Increasing the total budget for ACP outreach, including the grant program, as these commenters suggest would reduce the amount of funding available to provide the ACP benefit to as many eligible households for as long as possible.

45. The Commission otherwise declines in this final rule to prescribe a specific number of funding opportunities for the Outreach Grant Program. CGB should determine how quickly and in what amounts to disperse funding across the duration of the Outreach Grant Program. The Commission also directs CGB, in coordination with WCB and OMD, to decide whether to make the grant funds available through one or multiple NOFOs. CGB shall also determine the size of each grant awarded to each eligible outreach partner within the budget limit the Commission establishes herein based on an application process that complies with the applicable Federal grant regulations. The Commission notes that some commenters advocate for front-loading the grant funds to maximize the impact of the outreach grants in the early years of the Outreach Grant Program where the need for outreach is likely to be the greatest. The Commission agrees that this would be an appropriate approach for CGB to consider in deciding funding allocations, including the allocation of the funding set aside for pilot participants, and allocation for competitive grants to eligible entities, to include set-asides to States and U.S. Territories, as well as Tribal organizations, for this Outreach Grant Program. To determine the funding allocation across the grant program, including whether to issue one or multiple NOFOs, the Commission directs CGB to consult with OMD, WCB, OEA, and OGC as appropriate to ensure compliance with the applicable statutes and regulations governing Federal grant programs and the requirements the Commission establishes in this final rule, to also ensure consistency with the Outreach Grant Program's goal and objectives, and to further its interest in maximizing the impact of the grant funds as early as practicable in the course of the Affordable Connectivity Program.

46. The ACP FNPRM sought comment on whether the grant program should be a one-time funding opportunity or a multiple-year program. Certain commenters advocate for allowing eligible outreach partners to apply for grant funds throughout the Affordable Connectivity Program. The Commission permits CGB to continue to make grant awards until the Affordable Connectivity Program's end is announced consistent with any wind-down processes established by WCB, or until all grant funds allocated for outreach in this final rule is disbursed. When the ACP FNPRM was released, the Commission capped outreach funding to $100 million over the next five years. However, increased subscriber numbers could accelerate the depletion of the Affordable Connectivity Fund prior to the allotted 5-year-period for outreach spending. CGB shall coordinate with WCB on the wind-down process to be established pursuant to the direction the Commission provided in the ACP Order. At the point when the forecasted end of the Affordable Connectivity Program is announced pursuant to those wind-down procedures, the Commission expects that new grantees would not have sufficient time to implement and execute new outreach efforts, and any new grant awards would be highly unlikely to have meaningful impact on increasing awareness of and enrollment in the Affordable Connectivity Program. Accordingly, the Commission finds that it would not be fiscally responsible to issue new grant awards after the forecasted end of the Affordable Connectivity Program is announced pursuant to the wind-down procedures established by WCB, unless additional spending is otherwise authorized by Congress. To effectuate the Commission's direction here, CGB is authorized to cancel, withdraw, or set aside any open NOFO and to cease processing any grant applications once the forecasted end of the ACP is announced. The deadline the Commission establishes for making new grant awards provides CGB flexibility to continue to make new grant awards for as long as practicable, while also ensuring that grant funds are being used in a fiscally responsible manner. Entities that receive grant awards may continue to use their grant funds for outreach until ACP enrollments cease, pursuant to any ACP wind-down procedures established by WCB. To the extent that uncommitted funding remains in the Outreach Grant Program budget or awardees have unused grant funds after the end of the Outreach Grant Program, but before the end of the Affordable Connectivity Program, the remaining funds may be allocated back to the larger ACP budget to pay for broadband service and connected devices.

47. As explained in the ACP FNPRM, 2 CFR part 200 outlines numerous requirements for the administration and management of Federal grant programs. As required under Federal grant regulations, the Commission formally adopts and implements the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. In the following, the Commission also provides additional guidelines and requirements for the development, administration, and management of the grant program. CGB must develop, administer, and manage the Outreach Grant Program in compliance with the applicable Federal laws and regulations for grant programs and in compliance with the goal and objectives and any other requirements that the Commission has established for the Outreach Grant Program. This authority includes developing and administering, and the issuance of NOFO(s), establishing terms and conditions of each grant, adopting, modifying, and/or clarifying implementing regulations, and issuing orders, public notices, and/or publicly available instructions provided to applicants and/or grantees. Further, CGB shall consult with OMD, WCB, and OGC as appropriate to ensure compliance with these requirements and the requirements outlined in this final rule.

48. Federal agencies administering Federal grant programs are required to release a NOFO for grant opportunities. The NOFO provides detailed information about the specific grant opportunity, including information about the amount of funding available, eligible entities, fundable expenses and activities, application and evaluation process, reporting requirements, and other rules and requirements for the grant opportunity. The Commission directs CGB to develop and issue a NOFO for any funding opportunity for the Outreach Grant Program, in compliance with the applicable Federal regulations concerning NOFOs and the requirements the Commission establishes in this final rule, and consistent with the goal and objectives for the Outreach Grant Program. CGB shall consult with WCB, OGC, and the Office of the Inspector General (OIG) as appropriate to ensure that any NOFO issued for the grant program complies with the applicable Federal statutory requirements and regulations and any rules, requirements and policies set forth in this final rule.

49. The authorizing statute and Federal grant regulations do not require the Commission to adopt a matching requirement for the grant program. Accordingly, the Commission has the discretion to determine whether to require grant recipients to provide matching funds or contributions. Benefits Data Trust opposes a match requirement, while other commenters discuss the significant budget limitations faced by many of the types of organizations that are eligible for the grant program.

50. Based on the Commission's careful review of the record and in consideration of the urgent need for outreach by a diverse range of eligible outreach partners, it finds that a matching requirement for the Outreach Grant Program would likely thwart the potential effectiveness and impact of the grant program. The record demonstrates that many prospective eligible outreach partners are already facing significant budget constraints. Therefore, a matching requirement for the Outreach Grant Program would likely discourage or delay applications from potential outreach partners, particularly smaller organizations. A matching requirement may also lead potential outreach partners to design and propose more limited-scope outreach efforts to ensure they have sufficient funding or resources to satisfy a matching requirement. These outcomes would potentially minimize the number of eligible households touched by grant-funded outreach and, thus, would not serve the goal or objectives of the Outreach Grant Program. Accordingly, the Commission declines to adopt a matching requirement for this grant program. Consistent with this decision, grantees that are pass-through entities also may not require a match from subrecipients. While the Commission declines to adopt a matching requirement as a condition of receiving an outreach grant, it recognizes that matching funds can maximize the effectiveness and impact of the limited outreach grant program funds. Accordingly, as explained in the following, for purposes of prioritizing grant awards, the Commission directs CGB to consider whether the applicant proposes a cost match or cost share, among other factors.

51. The Infrastructure Act does not specify the type of grant that the Commission may issue for the grant program. Therefore, the Commission has the authority to make this determination. For Federal grants, the potential types of grants include, but are not limited to, discretionary grants (which generally require a competitive process) and formula grants (which generally provide set amounts of funding based on specific criteria). The Commission concludes that competitive funding opportunities would best further the goal and objectives of the Outreach Grant Program, encourage participation by a diverse range of outreach partners, and maximize the impact of the grant program as early as practicable. The Commission also concludes that it would be appropriate to issue more than one NOFO. To the extent that more than one funding opportunity is released for this grant program, it will be necessary to allocate funding for each funding opportunity consistent with the allocations specified in this final rule or as it may be necessary to set award ceilings or floors.

52. The Commission directs CGB to decide whether funding will be released through one or more funding opportunity, determine the allocation of funding for any funding opportunity under the Outreach Grant Program consistent with the allocations specified in this final rule, and establish minimum funding amounts for States and U.S. Territories or award floors or ceilings to the extent necessary. CGB may roll over unused funding from one set-aside to another, or from one funding opportunity to another. CGB's determinations on the number of funding opportunities and related funding allocations must be consistent with the goal and objectives of the grant program and must also promote the Commission's interests in maximizing the impact of the Outreach Grant Program as early as practicable and encouraging participation by a diverse range of outreach partners across diverse geographic regions. To make these determinations, the Commission directs CGB to consult with WCB, OMD, OEA, and OGC as appropriate to ensure compliance with Federal grant laws and regulations and requirements in this final rule, and to ensure consistency with the goal and objectives of this grant program. Any NOFO issued for this grant program shall provide specific detail on the grant opportunity including, but not limited to, the type of grant, the total amount of funding for the grant opportunity, and any ceilings and floors for the grant opportunity.

53. The ACP FNPRM asked whether use of outreach grant funds should be limited to named grantees or pass-through entities, or whether subgrantees, that is, subrecipients, could use funds for outreach. The Commission also sought comment on the prevalence of subrecipient models in Federal grant programs, and the advantages and disadvantages of a subrecipient model. Many commenters advocate for allowing pass-through entities to use subrecipients to conduct outreach under the Outreach Grant Program, and explain that the subrecipient model has proven highly effective in other contexts. According to commenters, a subrecipient model facilitates the participation of smaller entities that may not have the capacity or resources to apply for grants and comply with reporting requirements and allows for leveraging pass-through entity resources and expertise.

54. Based on the Commission's careful consideration of the record, it agrees that allowing pass-through entities to use subrecipients would best promote the goal and objectives of the Outreach Grant Program and maximize the potential scope and impact of grant-funded outreach. Allowing the subrecipient model would also facilitate the administration of the Outreach Grant Program by reducing the number of grants awarded and requiring management. Consequently, the Commission directs CGB to permit the use of subrecipients, where appropriate ( e.g., grant awards to a national organization or to a state or local government), for funding opportunities for the Outreach Grant Program. Any subrecipients must satisfy the eligibility requirements the Commission establishes in this final rule. To ensure full transparency regarding any subrecipients, grantees who are pass-through entities must inform CGB of which subrecipients they use, as well as the amount of each subaward. Pursuant to Federal grant regulations, pass-through entities are responsible for conducting risk assessments of potential subrecipients, monitoring their subrecipients and ensuring their subrecipients' compliance with the requirements of applicable Federal laws and regulations and this grant program. Consistent with the delegations of authority in this final rule, CGB, in consultation with OMD, may require pass-through entities to have additional policies and procedures in place to ensure subrecipient compliance with the grant requirements, terms and conditions.

55. The ACP FNPRM also sought comment on the application process and requirements for the grant program, noting that in previous comments, the National Digital Inclusion Alliance proposed that the application process be as minimally burdensome as possible, especially for small organizations that have limited capacity to participate in large Federal grant programs. This view is shared by many other commenters, who urge the Commission to avoid creating a program so complex that it discourages applicants. Commenters also advocate for an “accessible and non-burdensome application process.” The Commission acknowledges commenters' desire for minimal administrative burden for applicants and agree that an overly complex application process could deter applicants who could provide meaningful outreach.

56. The Commission directs CGB to develop an application process, which may include relevant application templates and any supplements as appropriate, for the Outreach Grant Program in compliance with the applicable Federal guidance and regulations and consistent with the goal and objectives of the grant program. Among these regulations, 2 CFR 200.207, as implemented by the Commission, requires use of standard OMB-approved grant applications and provides for agency use of any supplemental application requirements. CGB may determine the types of eligible entities outlined in this final rule that may be eligible for a particular funding opportunity for the grant program. To develop such an application, the Commission directs CGB to consult with WCB, OMD, and OGC as appropriate to ensure compliance with the applicable Federal laws and regulations and to also ensure consistency with the program goal and objectives. In developing the application process for the grant program, the Commission further directs CGB to carefully balance minimizing the burden to potential applicants (as discussed in the comments) and the need for sufficient information to allow reviewers effectively to analyze applications and comply with Federal grant regulations, and select applications best positioned to conduct effective, meaningful outreach.

57. Any application for the grant program must collect information sufficient for meaningful review. At a minimum, applicants must submit the following information as part of an application package: (a) project summary; (b) detailed budget; (c) budget narrative supporting the budget and demonstrating that it is consistent with the requirements in the NOFO; and (d) any mandatory forms for Federal grants. As part of the project summary, applicants will provide: a description of the geographic areas that will be targeted and served through the proposed outreach; constituencies intended to be targeted and served, to include members of an unserved or marginalized community; an estimated number of households or individuals to be targeted; whether the outreach will target communities that have low ACP participation rates; description of the applicant's role in the community which it is serving; description of the applicant's outreach goals and milestones and for their proposed outreach; and a description of whether the applicant is proposing a cost-match or cost share for their proposed outreach. These and additional project summary information requirements will be captured in detail as part of the NOFO release. To guard against duplicative funding and ensure that outreach grant program funding will be awarded for new outreach efforts and not outreach efforts for which an applicant already has funding or expects to receive funding, applicants will also be required to disclose support or funding for outreach received from broadband providers and other sources, or certify that they received no such support or funding, and to explain the need for additional funding from the Outreach Grant Program if they have already received, are receiving, or expect to receive other support or funding for ACP outreach. The Commission directs CGB to work with OEA to collect information on how grantees will gather data and track metrics related to meeting the Outreach Grant Program's goal and objectives. CGB may require any additional information necessary to evaluate grant applications and ensure compliance with the applicable Federal laws and regulations applicable to grants. CGB may also issue more than one application process or template to accommodate different types of grants, or different grant opportunities under the grant program, as necessary.

58. Red Light Rule. The Outreach Grant Program will be subject to the red light rule that the Commission implemented to satisfy the requirements of Debt Collection Improvement Act of 1996. Under the red light rule, the Commission will not take action on applications or other requests by an entity that is found to owe debts to the Commission until full payment or resolution of that debt. If the delinquent debt remains unpaid or other arrangements have not been made within 30 days of being notified of the debt, the Commission will dismiss any pending applications. Consistent with practices in the Lifeline program and other programs such as the Telecommunications Relay Service, the red light rule is not waived for the Affordable Connectivity Program and its Outreach Grant Program. If a prospective grant applicant is on red light, it will need to satisfy or make arrangements to satisfy any debts owed to the Commission before its application and/or election notice will be processed. The Commission directs CGB and OMD to ensure that a process is in place to check an entity's red light status prior to processing a grant application, disbursement, or other request from the entity consistent with the red light rule.

59. Treasury Offset. Grant outreach grantees will be subject to Treasury Offset. The Treasury has several collection tools, including its offset program, known as the Treasury Offset Program (TOP), through which it collects delinquent debts owed to Federal agencies and states by individuals and entities, by offsetting those debts against Federal monies owed to the debtors. Grant recipients that owe past-due debt to a Federal agency or a state may have all or part of their payments offset by Treasury to satisfy such debt. Prior to referral of its debt to Treasury, entities are notified of the debt owed, including repayment instructions. If the referred debt of a grantee remains outstanding at the time of a payment by the U.S. Treasury from the ACP Fund to that grantee, the grantee will be notified by Treasury that some or all of its payment has been offset to satisfy an outstanding Federal or state debt. Potential grant applicants who owe past due Federal or state debts are encouraged to resolve such debts and in doing so, consult the TOP Frequently Asked Questions for the Public, available at https://fiscal.treasury.gov/top/faqs-for-the-public.html, for delinquent debt that has been referred to Treasury, and for delinquent debt that the Commission has not yet referred to Treasury, consult https://www.fcc.gov/general/red-light-frequently-asked-questions.

60. Additional Requirements. To be eligible to receive disbursements from the Affordable Connectivity Fund, grant applicants must obtain and report an FRN. Persons or entities doing business with the Commission are required to obtain an FRN, a unique identifier that is obtained through the Commission Registration System. Participating grant applicants must obtain an FRN if they do not already have one and report it as directed by the Commission.

61. SAM Registration. All entities that intend to apply for a grant must also register with the SAM. SAM is a web-based, government-wide application that collects, validates, stores, and disseminates business information about the Federal Government's partners in support of Federal awards, grants, and electronic payment processes. With data in SAM the Commission has an authoritative source for information necessary to provide funding to applicants and to ensure accurate reporting pursuant to the Federal Funding Accountability and Transparency Act of 2006, as amended by the Digital Accountability and Transparency Act of 2014 (collectively the Transparency Act or FFATA/DATA Act). Only grantees registered in SAM with an active registration will be able to receive reimbursement from the Affordable Connectivity Fund. Furthermore, participating grantees may be subject to reporting requirements. To the extent that participating grantees subaward the grant, as defined by FFATA/DATA Act regulations, such grantees may be required to submit data on those subawards.

62. Do Not Pay. Pursuant to the requirements of the Payment Integrity Information Act of 2019, the Commission must ensure that a thorough review of available databases with relevant information on eligibility occurs to determine program or award eligibility and prevent improper payments before the release of any Federal funds. To meet this requirement, the Commission will make full use of the Do Not Pay system administered by the Treasury's Bureau of the Fiscal Service as has done for other payments from the Affordable Connectivity Fund. If a check of the Do Not Pay system results in a finding that an ACP grant recipient should not be paid, the Commission will withhold issuing commitments and payments. The Commission may work with the grant recipient to give it an opportunity to resolve its listing in the Do Not Pay system if the grantee can produce evidence that its listing in the Do Not Pay system should be removed. However, the grant recipient will be responsible for working with the relevant agency to correct its information before payment can be made by the Commission.

63. The Commission directs CGB, in coordination with WCB, OGC, OEA, and OMD, to develop a robust application review process to ensure that the grant awards maximize the impact of grant funds on ACP awareness and participation among qualifying low-income households and also ensure the fiscally responsible use of government funds. To ensure compliance with the applicable Federal statutes and regulations, the review process must include, at a minimum, compliance, merit, and risk assessment components. Compliance review involves assessing whether application materials are complete and comply with NOFO requirements. Merit review involves objectively evaluating, using review and scoring criteria outlined in the NOFO, an applicant's outreach proposal for likely efficacy in meeting the Outreach Grant Program's objectives. Risk assessment review involves examining an applicant's fiscal stability and operational capabilities, including the risk associated with allowing the applicant to expend Federal funds. In developing the application review process, CGB shall consult with WCB, OMD, OEA, and OGC as appropriate to ensure compliance with the applicable Federal laws and regulations for grant programs, and to otherwise ensure consistency with the goal and objectives of the grant program.

64. The ACP FNPRM sought comment on whether certain grant applications should be prioritized and evaluated. Based on the Commission's review of the record and experience administering the Affordable Connectivity Program, and its predecessor the EBB Program, it concludes that prioritizing certain applications will best promote the goal and objectives of the Outreach Grant Program, ensure that grant funding is targeted to where it will have the greatest impact on addressing the digital divide, and maximize the impact and effectiveness of the Outreach Grant Program funding. In evaluating applications, the Commission directs CGB, at a minimum, to prioritize applications based on the following criteria: (1) the extent to which an applicant would target unserved low-income households or individuals ( i.e., households or individuals that are not currently on a low-income broadband plan or that do not have broadband service); (2) the extent to which an applicant would target outreach in communities that have low ACP participation rates (including people of color, persons with disabilities, persons who live in rural or Tribal areas, and others who are or have been historically underserved, marginalized, or adversely affected by persistent poverty or inequality); and (3) whether an applicant proposes a cost-share or cost match. In evaluating grant applications from state governmental entities or territorial governmental entities, CGB may also consider prioritizing grants based on whether the state or territory has entered into or has committed to enter into a Computer Matching Agreement with USAC for purposes of verifying the eligibility of low-income consumers for the Affordable Connectivity Program. The prioritization factors outlined in this final rule and any other prioritization and evaluation factors shall be identified in the NOFO(s).

65. Commenters suggest additional ways to prioritize or select applications to maximize the impact of the grant funds. CGB may decide to use additional prioritization factors to promote the goal of the Outreach Grant Program and maximize the reach, effectiveness, and impact of the grant funds. Consistent with the record, when developing prioritization criteria and evaluation criteria, CGB may also consider, for instance, an applicant's experience, ties to local communities, multilingual capabilities, ACP and digital equity experience, all of which may be relevant to the likelihood of success of an applicant's outreach plan. The following are examples of prioritization or evaluation factors that may be appropriate for CGB to use for purposes of maximizing the impact and effectiveness of the outreach grant funds:

• Experience with, and past success in, conducting outreach regarding government programs and resources, particularly providing resources and directing services (such as ACP application assistance) and education to people of color, persons with disabilities, persons who live in rural or Tribal areas, and others who are or have been historically underserved, marginalized, or adversely affected by persistent poverty or inequality;

• Existing relationships with the communities grant applicants expect to target ( e.g., as “trusted messengers”), or the ability to readily establish those relationships, particularly relationships with people of color, persons with disabilities, persons who live in rural or Tribal areas, and others who are or have been historically underserved, marginalized, or adversely affected by persistent poverty or inequality;

• Participation in the Commission's ACP Navigator or Your Home, Your internet Pilot Programs;

• Familiarity with the Affordable Connectivity Program and experience with or knowledge of digital equity and connectivity issues;

• Experience with or capability of providing multilingual outreach;

• A plan and/or demonstrated capacity to collect data and track metrics in order to comply with reporting requirements;

• Ability to provide outreach to multiple categories of outreach targets;

• Experience working with subrecipients with relationships to targeted communities, if an applicant intends to pass through awards to subrecipients.

66. The ACP FNPRM also sought comment on whether and how grants should be distributed to achieve geographic diversity and diversity in recipient organization sizes and types. A few commenters advocate allocating grants based on geographic diversity. Others recommend ensuring funding to entities of various sizes. The Commission agrees that a diversity of award recipients and geographic areas would further the interest in nationwide ACP enrollment and outreach to target populations. Accordingly, in developing and administering the grant program, the Commission directs CGB to consider how best to ensure that grant awards are made to diverse geographic regions and entity sizes or types, whether through the funding announcement or evaluation process, and to consult with OEA and WCB to make these determinations.

67. The Infrastructure Act does not establish a performance period for the outreach grants. In the ACP FNPRM, the Commission sought comment on an appropriate performance period for the outreach grants. The Commission directs CGB to determine the performance period for any grant opportunity issued for the grant program. The Commission notes that many commenters indicated that a one-year performance period would not provide grantees sufficient time to develop and implement their proposed ACP outreach, and that a more than one-year performance period is more likely to incentivize applications. To determine an appropriate performance period for the outreach grants, the Commission directs CGB to consider the time frames needed to implement and execute meaningful outreach efforts based on its own outreach experience and those of existing outreach partners. The Commission further directs CGB to take into account the ACP budget projections to ensure that the performance period maximizes the impact of grant funds as early as practicable. Consistent with Federal regulations, any NOFO issued for the Outreach Grant Program will specify the performance period. As such, applicants must submit a grant application with a budget spend or draw down plan to cover the period of performance, demonstrating a plan to execute outreach efforts and support grant award closeout activities within the established period of performance.

68. Federal agencies administering grant programs are required to establish performance measures to “show achievement of program goal and objectives, share lessons learned, improve program outcomes, and foster adoption of promising practices” and establish reporting requirements. The ACP FNPRM sought comment on the performance measures and reporting requirements for the grant program. Given its extensive experience conducting outreach, the Commission directs CGB to develop performance measures and reporting requirements for the Outreach Grant Program in compliance with the applicable Federal regulations. The Commission directs CGB to consult with OEA, OMD, and WCB to determine the appropriate performance measures as well as data collection and reporting requirements and related deadlines for this grant program, and to ensure the metrics and reporting requirements comply with the applicable Federal regulations, are consistent with the goal and objectives for the grant program, are tailored to accommodate a range of fundable outreach, and support a fiscally responsible administration of the program. The Commission further directs USAC to provide Commission staff upon request Affordable Connectivity Program data relevant to assessing the performance of the Outreach Grant Program, as determined by CGB, WCB, OEA and OMD.

69. To develop the performance measures and related grantee reporting requirements, CGB should strike an appropriate balance between the need for robust metrics and reporting requirements to assess the performance of the grant program and need for financial reporting, and the administrative burden to grantees. The Commission notes that many commenters caution against overly burdensome reporting requirements, and advocate for reporting on no more than an annual basis. In addition, many commenters stress the need for any performance measures to take into account the various types of outreach that may be funded through the grant program—metrics that may be appropriate for one type of outreach ( e.g., in-person events) may not be appropriate for other types of outreach ( e.g., paid media). A few commenters also recommend collecting qualitative (such as personal stories) as well as quantitative data to measure performance. At a minimum, the Commission requires grantees to report on the outreach activities they performed with the grant funds, how the grant funds were spent, and the effectiveness of those outreach activities. Consistent with the applicable Federal regulations, any NOFO that is released for the grant program will provide specific detail on the performance measures and reporting requirements and any reporting deadlines. Grantees must comply with progress and financial reporting requirements for the grant program, as outlined in the NOFO.

70. All awards made through the Outreach Grant Program will be subject to the audit and document retention requirements under the applicable Federal laws and regulations for grant programs. In addition to these requirements, the Commission directs CGB and OMD, to conduct compliance audits for grantees that are not subject to the single audit act requirements ( i.e., non-Federal entities that do not expend Federal awards of $750,000 or more in the recipient's fiscal year) to ensure compliance with the Federal grant regulations, and any program rules and requirements outlined in the NOFO and grant award for individual grantees. Grantees must cooperate with any such audits and provide the requested documentation pertaining to their participation in the grant program. As noted in the following, failure to cooperate to the fullest extent required by the Commission or USAC staff may result in the termination of the award or disallowance of costs, subsequent recovery of funds by the Commission, or other enforcement actions.

71. The Commission emphasizes that it is committed to program integrity, guarding against waste, fraud, and abuse and ensuring that funds disbursed through the Outreach Grant Program are used only for approved purposes. The Commission makes clear that the enforcement authority it has with respect to the Affordable Connectivity Program, including the authority to impose forfeiture penalties to enforce compliance, also applies to the Outreach Grant Program. The Commission also has tools beyond forfeiture to address grantee noncompliance, including imposing additional conditions, disallowing costs, and suspending or terminating awards. The Commission takes seriously its enforcement obligations. Consistent with the Infrastructure Act's requirement that the Commission act expeditiously to investigate potential violations of program rules and requirements and to enforce compliance, the Commission directs the Enforcement Bureau to expeditiously investigate potential violations of and enforce the Outreach Grant Program rules and grant award terms and conditions. The Commission also reserves the right to take appropriate actions, including, but not limited to, seeking recovery of funds.

72. The ACP FNPRM sought comment on the types of technical assistance and other support the Commission could provide to prospective applicants and grantees in connection with the Outreach Grant Program. Specifically, the Commission sought comment on what might be valuable technical assistance to grantees and how technical assistance might evolve over the duration of the grant program implementation. The Commission also sought comment on the types of materials that it could provide outreach partners in connection with the Outreach Grant Program.

73. Several commenters support providing technical assistance to applicants. NDIA urges the Commission to provide technical assistance to prospective applicants by hosting informational webinars, holding office hours for real-time applicant assistance, and providing applicants with links to grant-writing resources and tools. SANDAG requests that the Commission provide optional training sessions for grantees to attend that could “answer questions regarding materials, provide step-by-step instructions on how to use tools, and serve as another opportunity to share best practices.” The Hawaii Broadband & Digital Equity Office recommends that the Commission provide technical assistance online or in-person as needed and specifically “conduct at minimum one annual `face-to-face' technical assistance meeting” with representatives from both grantees and subgrantees.” The Hawaii Broadband & Digital Equity Office also asks that the Commission provide technical assistance related to allowable costs associated with facilities, refreshments, mileage reimbursement, and incentives for enrollment engagements.

74. The Commission agrees that CGB should provide opportunities to walk prospective applicants through the application process and further explain the purpose and scope of the grant program. Due to the competitive nature of the funding opportunities for this grant program, CGB cannot assist prospective applicants in preparing individual applications or developing outreach proposals, as this would undermine the integrity of the application and evaluation process. However, CGB will provide publicly available general information further explaining elements of the grant program and NOFO. The Commission also finds that it would be helpful to obtain feedback from participants concerning the administration and design of the grant program. The Commission therefore directs CGB to provide opportunities ( e.g., webinars, fact sheets, frequently asked questions) to help prospective applicants understand the Outreach Grant Program and its requirements and to obtain feedback from grantees during their period of performance. The Commission directs CGB to determine the mechanisms for and timing of requesting any feedback from participants, and to provide information sessions tailored to specific funding opportunities, to make adjustments to the program administration as appropriate during the course of the grant program based on feedback from participants, and to provide new information sessions or training to reflect any such adjustments. In providing information sessions, the Commission directs CGB to encourage applications from entities of all types and diverse organizations, including those serving, led, and/or owned by persons of color, persons with disabilities, persons who live in rural or Tribal areas, and others who are or who have been historically underserved, marginalized, or adversely affected by persistent poverty or inequality, and entities participating in the ACP Navigator Pilot and the Your Home, Your Internet Pilot Program.

75. Commenters also request that the Commission develop and disseminate toolkits, outreach materials, and train-the-trainer guides related to conducting outreach to eligible households about and encouraging eligible households to enroll in the Affordable Connectivity Program. In addition, several commenters emphasize the importance of multilingual outreach and outreach resources, and request that the Commission provide grantees and subrecipients with multilingual outreach materials. While CGB already provides and continues to make available extensive outreach toolkits and ACP materials in multiple languages, the Commission directs CGB to evaluate whether revisions should be made to the existing toolkits, trainer guides, and or other outreach materials for use by grant program participants and to also evaluate whether new toolkits or materials or additional non-English translations would help promote the effectiveness and impact of the grant program. To carry out these responsibilities, CGB may engage consultants or contractors. Providing standardized materials would increase efficiency and expedite grantees and subrecipients' outreach, particularly for smaller organizations with limited resources, and would promote accurate and consistent ACP messaging. However, to maximize the impact of grant-funded outreach, the Commission encourages grantees to develop their own outreach materials tailored to the areas and communities that are the focus of their outreach.

76. The Commission next addresses commenter requests for other types of support and assistance for grantees. For example, EducationSuperHighway requests that the Commission provide grantees a “sandbox,” or virtual testing environment that would simulate the National Verifier application and enrollment process. Other commenters request additional training for individuals providing application assistance. The Commission finds that existing resources for partner organizations and potential grant resources for future grantees are sufficient to train and educate individuals providing consumers with application assistance. EducationSuperHighway and NDIA also ask that the Commission provide real-time support, either through live chat or a call center for grantees that provide application assistance. The Commission reminds prospective applicants of the existing ACP call center resources to answer questions about the application process. While extensive resources are already available to assist outreach partners with helping eligible consumers to navigate the ACP application process, CGB may, in consultation with WCB and USAC, explore the utility and feasibility of providing other avenues for providing assistance and technical support to grantees that provide application assistance.

77. The Commission makes robust data available to track enrollments in the Affordable Connectivity Program and to allow grantees to identify potential areas where targeted outreach could be beneficial, including making aggregate enrollment data available by ZIP code, county, age, National Verifier selected eligibility criteria, and type of service. Additionally, as explained in the ACP Order, separate from the grant program, the Commission has directed WCB and OEA, with support from USAC, to collect data to develop metrics to determine progress towards narrowing the digital divide, and WCB, OEA, and USAC are continuing to explore potential metrics to track that goal. Some commenters request that the Commission collect and make available plan characteristic and pricing information for the Affordable Connectivity Program. The Commission is required by the Infrastructure Act to make additional information concerning ACP plan pricing and characteristics available through the Commission's Broadband Labels or ACP Transparency Data Collection proceedings. Once the Commission defines the requirements of those initiatives later this year, CGB may consider whether these data can be useful for participants engaged in or considering a meaningful outreach campaign. The Commission also believes the program data already publicly available to grant recipients is sufficiently robust that the Outreach Grant Program need not be delayed pending the resolution of those proceedings. Indeed, today, CGB currently conducts outreach, and coordinates outreach with other organizations without this data.

78. At least one commenter requests that the Commission establish a grantee database of organizations engaged in Affordable Connectivity Program outreach efforts including organizations' contact information, details about service areas, expertise, and available resources. The purpose of this database would be to allow for resource sharing and coordination among grantees. Federal regulations already require Federal awarding agencies to announce all Federal awards publicly and to publish the required information about the award on a publicly-available OMB designated website. To promote transparency, the Commission directs CGB also to provide publicly available information on the entities that have received awards through the Outreach Grant Program on the Commission's website. At a minimum this information should include the name of the awardee, the amount of the award, an abstract outreach project summary, and a main point of contact for the funding recipient. In addition, the Commission recognizes that grantees may be interested in additional information concerning other grantees and their outreach efforts to facilitate coordination and communication amongst grantees. Accordingly, the Commission directs CGB to explore the possibility of making available additional information on participants in this grant program to facilitate coordination and communication amongst grantees, and it expects CGB to determine how this information could be made available, and also the types of data that could be made available to facilitate coordination and communication amongst participants in the grant program. Based on grantees' willingness to participate, CGB may also establish and host an information sharing forum to exchange lessons learned and best practices among grant recipients in executing outreach activities.

79. Additionally, some commenters request that the Commission issue unique grantee ID numbers to allow for tracking enrollments for specific outreach efforts, and communication and coordination amongst grantees. Although this proposal raises potential technical, administrative, and legal issues, the Commission agrees there may be utility in tracking enrollments based on grantees' outreach efforts, perhaps by requiring the use of an FRN, SAM registration number, or other unique identifier a grantee would be required to obtain as part of the Outreach Grant Program, to the extent this is technically and administratively feasible. The Commission nevertheless directs CGB and OEA to explore the feasibility and administrability of tracking enrollments by grantee outreach effort and legality of disseminating this information.

80. The Commission acknowledges that many commenters stress the importance of and need for data transparency concerning the Outreach Grant Program. To promote transparency, the Commission directs CGB, with assistance from WCB, OMD, OEA, and USAC as appropriate, to submit to them interim updates, and a final report detailing the results of the Outreach Grant Program. CGB shall submit the final report after the end of the grant program, after all grant awards have been closed out. At a minimum, the final report shall provide an assessment of the grant program's performance against the goal identified in this final rule and shall also summarize any lessons learned concerning the development, administration, and management of the Outreach Grant Program.

81. Over 12 million low-income households have already benefited from ACP enrollment. Most providers offer plans that are either fully or largely covered by the monthly subsidy, allowing households to obtain affordable broadband to access job search and work options, educational, telehealth, and entertainment resources, and communicate with family and friends. However, tens of millions of eligible households have yet to enroll in the Affordable Connectivity Program. From the Commission's review of comments, it appears that many of these households have traditionally been the most underserved and underrepresented when it comes to broadband access. By increasing program awareness among this diverse and underserved population, the Outreach Grant Program will make substantial progress toward narrowing the digital divide.

82. While the potential benefits of the Outreach Grant Program are substantial, the Commission seeks to provide funding to support outreach in the most cost-effective manner possible, and its discussion in this final rule reflects that goal. The Commission recognizes that outreach to a diverse and underserved population can be more effectively accomplished by providing support to a diverse group of qualified grantees that are capable of directly or indirectly (through subrecipients) conducting effective outreach activities or working directly with low-income populations to raise awareness of the Affordable Connectivity Program or provide application assistance. The Commission's decision to open eligibility up to a wide range of governmental and non-governmental entities should result in a wide range and variety of outreach efforts targeted towards different segments of the targeted low-income population by grantees and subgrantees capable of conducting this outreach. Further, the Commission only permits grantees to receive support for allowable costs consistent with the goal and objectives of the Outreach Grant Program.

83. The Commission also extends to CGB the flexibility necessary to administer the Grant Program in a cost-effective manner. The Commission makes it possible for CGB to structure NOFOs for the grant program so as to make use of the performance measures that the Commission requires CGB to track, and grantees to provide, in order to make more cost-effective funding allocation decisions for the duration of the grant program. For example, by not prescribing the number of funding opportunities or the size of grants at this time, the Commission allows CGB to make these determinations taking into account the information provided by potential outreach partners in the application process as well as enrollment, awareness or other programmatic data from the Affordable Connectivity Program to the greatest possible extent. Likewise, unless otherwise specified in this final rule, CGB has flexibility in how the overall grant program budget shall be distributed across one or more NOFOs. This prioritizes cost-effective spending by ensuring that funding decisions are driven by outreach needs and quality of grantee applications rather than presupposing uniformity. In taking these steps to maximize cost-effectiveness, the Commission compromises none of the integrity of the Outreach Grant Program: it still requires that grantees operate in a broadband service provider-neutral manner, prohibit grantee representatives from receiving compensation based on the number of ACP applications or enrollments attributable to their outreach (including enrollment assistance), prohibit grantees from earning or keeping any profit resulting from a grant award, and the Commission maintains full accordance with all Federal requirements for the administration and management of Federal grant programs.

84. All of the rules that are adopted in this final rule are designed to work in unison to develop, administer and manage the Outreach Grant Program, provide grant funds to eligible outreach partners, and to protect the integrity of the Outreach Grant Program's administration. However, each of the separate rules the Commission adopts here serves a particular function toward these goals. Therefore, it is the Commission's intent that each of the rules adopted herein shall be severable. If any of the rules is declared invalid or unenforceable for any reason, it is the Commission's intent that the remaining rules shall remain in full force and effect.

85. Pursuant to 47 U.S.C. 1752(h)(2) the collection of information sponsored or conducted under the regulations promulgated in this final rule is deemed not to constitute a collection of information for the purposes of the Paperwork Reduction Act, 44 U.S.C. 3501-3521.

86. The Commission has determined, and the Administrator of the Office of Information and Regulatory Affairs, OMB, concurs, that this rule is “major” under the Congressional Review Act, 5 U.S.C. 804(2). The Commission will send a copy of the Report and Order to Congress and the Government Accountability Office pursuant to 5 U.S.C. 801(a)(1)(A).

87. Regulatory Flexibility Act. Consistent with the Regulatory Flexibility Act of 1980, as amended (RFA), the Commission included an Initial Regulatory Flexibility Analysis (IRFA) of the possible significant economic impact on a substantial number of small entities by the policies and rules proposed in the ACP Order in WC Docket No. 21-450. The Commission sought written public comment on the proposals in the ACP Order, including comment on the IRFA. No comments were filed addressing the IRFA. This Final Regulatory Flexibility Analysis conforms to the RFA.

88. In the Infrastructure Act, Congress established the Affordable Connectivity Program, which is designed to promote access to broadband internet access services by households that meet specified eligibility criteria by providing funding for participating providers to offer certain services and connected devices to these households at discounted prices. The Affordable Connectivity Program funds an affordable connectivity benefit consisting of a $30.00 per month discount on the price of broadband internet access services that participating providers supply to eligible households in most parts of the country and a $75.00 per month discount on such prices for households residing in qualifying Tribal lands.

89. The Infrastructure Act also requires the Commission to conduct outreach efforts to inform potentially eligible households about the Affordable Connectivity Program and encourage them to enroll in the program, and it authorizes the Commission to provide grants to outreach partners in order to carry out this responsibility. With the expectation that the Affordable Connectivity Program will extend for multiple years, in this final rule the Commission promulgates rules and guidelines establishing the Outreach Grant Program. The Commission establishes a program goal and objectives, implements applicable Federal grant regulations, and provides a framework for the program.

90. The Commission establishes rules and requirements in this final rule necessary to establish the Outreach Grant Program. Additional information on the Outreach Grant Program, including, but not limited to, the application process and reporting requirements will be provided in a subsequent NOFO. Establishing the Outreach Grant Program is consistent with our authorization under the Infrastructure Act and our ongoing efforts to bridge the digital divide by ensuring that eligible low-income households have access to affordable, high-quality, broadband internet access service.

91. The RFA directs agencies to provide a description of, and where feasible, an estimate of the number of small entities that may be affected by the proposed rules, if adopted. The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. A small business concern is one that: (1) is independently owned and operated; (2) is not dominant in its field of operation; (3) satisfies any additional criteria established by the Small Business Administration (SBA).

92. Small Businesses, Small Organizations, Small Governmental Jurisdictions. The Commission's actions, over time, may affect small entities that are not easily categorized at present. The Commission therefore describes here, at the outset, three broad groups of small entities that could be directly affected herein. First, while there are industry specific size standards for small businesses that are used in the regulatory flexibility analysis, according to data from the SBA's Office of Advocacy, in general a small business is an independent business having fewer than 500 employees. These types of small businesses represent 99.9% of all businesses in the United States, which translates to 32.5 million businesses.

93. Next, the type of small entity described as a “small organization” is generally “any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.” The Internal Revenue Service (IRS) uses a revenue benchmark of $50,000 or less to delineate its annual electronic filing requirements for small exempt organizations. Nationwide, for tax year 2020, there were approximately 447,689 small exempt organizations in the U.S. reporting revenues of $50,000 or less according to the registration and tax data for exempt organizations available from the IRS.

94. Finally, the small entity described as a “small governmental jurisdiction” is defined generally as “governments of cities, counties, towns, townships, villages, school districts, or special districts, with a population of less than fifty thousand.” U.S. Census Bureau data from the 2017 Census of Governments indicate that there were 90,075 local governmental jurisdictions consisting of general purpose governments and special purpose governments in the United States. Of this number there were 36,931 general purpose governments (county, municipal and town or township) with populations of less than 50,000 and 12,040 special purpose governments—independent school districts with enrollment populations of less than 50,000. Accordingly, based on the 2017 U.S. Census of Governments data, the Commission estimates that at least 48,971 entities fall into the category of “small governmental jurisdictions.”

95. Regional Planning Committees. Neither the Commission nor the SBA have developed a small business size standard specifically applicable to Regional Planning Committees (RPCs). The closest applicable industry with a SBA small business size standard is Business Associations, which comprises establishments primarily engaged in promoting the business interests of their members. Examples of such organizations include: real estate boards, chambers of commerce, trade associations and manufacturers' associations. The SBA small business size standard for Business Associations classifies firms with annual receipts of $8 million or less as small. For this industry, U.S. Census Bureau data for 2017 show that there were 14,540 firms that operated for the entire year. Of these firms, 11,215 had revenue of less than $5 million. Based on this data, the majority of firms in this industry can be considered small.

96. The Commission set aside six megahertz of spectrum in the 800 MHz band for exclusive use by local, regional and state public safety agencies under guidelines developed by the National Public Safety Planning Advisory Committee (NPSPAC). The 800 MHz NPSPAC spectrum is administered on a regional basis by 55 public safety RPCs. RPCs consist of public safety volunteer spectrum planners and members that dedicate their time, to coordinate spectrum efficiently and effectively to make it available to public safety agency applicants in their respective regions. In the 700 MHz band the general use channels and some of the narrowband low power channels are subject to regional planning. There are 55 RPCs for the 700 MHz band whose task is to create a plan for General Use in their area and submit it to the Commission. RPCs are volunteer committees and the Commission does not have revenue information to which the SBA size standard can be applied. However, these committees typically have less than 5 members per region, therefore the Commission estimates that most RPCs are small.

97. Grants to Consumer Outreach Partners. The Commission, like all other Federal agencies, is required to comply with government-wide regulations governing grant awards, codified primarily in title 2 of the Code of Federal Regulations (2 CFR), that apply to all Federal agencies. Those uniform Federal grant-related requirements, developed based on guidance provided over a number of years by OMB, were codified in an interim final rule that OMB and over 30 other Federal agencies jointly adopted and published in the Federal Register on December 19, 2014 ( Uniform Guidance, 79 FR 75871, December 19, 2014). In adopting their own rules to implement these standardized grant-making requirements, some agencies that joined in the issuance of the Uniform Guidance —including the Department of Commerce, whose rules apply to sub-agencies including the National Telecommunications and Information Administration, and the SBA—incorporated OMB's guidance without change. Other agencies that joined in the issuance of the Uniform Guidance, including the Department of Agriculture's Rural Utilities Service (RUS), adopted additional language in their own regulations to provide more detail with respect to how they intended to implement the policy and to clarify any pertinent exceptions to the general rules.

98. OMB and the other agencies that joined in issuing the Uniform Guidance in 2014 concluded that, under the standards of the RFA, the requirements regarding grant awards would not have a significant economic impact on a substantial number of small entities. These agencies reached this conclusion based on the fact that largely identical generic requirements were already in place, and the Uniform Guidance simply codified them without any incremental impact on a substantial number of small entities.

99. The grant-related rules adopted in this final rule follow the Uniform Guidance that applies to all Federal agencies. Like OMB, SBA, and other agencies that joined in issuing the Uniform Guidance in 2014, the Commission does not anticipate that such rules will have a significant economic impact on a substantial number of small entities. A subsequent Notice of Funding Opportunity will be issued with additional information on the Outreach Grant Program, including the application and reporting requirements. These requirements will be necessary to ensure high-quality applications and facilitate the evaluation of the applications, and to also ensure compliance with the requirements in the Uniform Guidance. In establishing these requirements, consideration will be given to the administrative and compliance burdens on Outreach Grant Program participants, including small entities.

100. The RFA requires an agency to describe any significant, specifically small business, alternatives that it has considered in reaching its proposed approach, which may include the following four alternatives (among others): “(1) the establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance and reporting requirements under the rule for such small entities; (3) the use of performance rather than design standards; and (4) an exemption from coverage of the rule, or any part thereof, for such small entities.”

101. The Commission concludes that the rules adopted in this final rule are not likely to have any significant economic impact on eligible small entities that voluntarily opt to apply for outreach grants or participate in the Outreach Grant Program as subrecipients. Moreover, regardless of size, all entities that apply for an outreach grant will need to satisfy the minimum application requirements outlined in the applicable Notice of Funding Opportunity and entities participating in the Outreach Grant Program will be required to comply with Outreach Grant Program requirements, including, but not limited to, progress and financial reporting consistent with the government-wide Uniform Guidance, which necessarily will be the foundation of our rules and requirements for the Outreach Grant Program. This final rule declines to adopt a matching requirement for the Outreach Grant Program, because it would likely discourage or delay applications from potential outreach partners, particularly smaller organizations. In developing the rules and requirements, including, but not limited to, the application requirements and reporting requirements, consideration will be given to the burdens on all participants, including small entities. The Outreach Grant Program will permit subrecipients where appropriate ( e.g., awards to state or local government entities, or national entities), which will enable eligible small entities to participate in the Outreach Grant Program and benefit from the administrative capacity and resources of larger grantees with respect to reporting and other Outreach Grant Program requirements, which may minimize the administrative and compliance burdens for small entities that participate as subrecipients.

1. Accordingly, it is ordered that, pursuant to the authority contained in Section 904 of Division N, Title IX of the Consolidated Appropriations Act, 2021, Public Law 116-260, 134 Stat. 1182, as amended by section 60502 of Division F, Title V of the Infrastructure Investment and Jobs Act, Public Law 117-58, 135 Stat. 429 (2021), and the authority contained in sections 1, 4(i), 5(c), and 303(r), of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 155(c), 303(r), 1752, and the authority contained section 60502 of Division F, Title V of the Infrastructure Investment and Jobs Act, 47 U.S.C. 1752(b)(10)(C), the Report and Order is adopted .

2. It is further ordered, that parts 0 and 54 of the Commission's rules, 47 CFR parts 0 and 54, are amended as set forth in the following, and such rule amendments shall be effective sixty (60) days after publication of the text or summary thereof in the Federal Register .

3. It is further ordered, that subtitle B of title 2 of the Code of Federal Regulations are amended as set forth in the following, and such rule amendments shall be effective sixty (60) days after publication of the text or summary thereof in the Federal Register .

For the reasons discussed in the preamble, the Federal Communications Commission amends subtitle B of title 2 and parts 0 and 54 of title 47 of the Code of Federal Regulations as follows:

DOE published a final rule in the Federal Register on July 22, 2022, amending certification requirements in part 429 of title 10 of the Code of Federal Regulations (10 CFR part 429) applicable to ceiling fan light kits (“CFLKs”), general service incandescent lamps, incandescent reflector lamps, ceiling fans, consumer furnaces and boilers, consumer water heaters, dishwashers, commercial clothes washers, battery chargers, and dedicated-purpose pool pumps. 87 FR 43952. Since publication of the final rule, DOE has learned of an error in the regulatory text for the CFLK certification provisions in 10 CFR 429.33. The regulatory text in this section contains provisions that apply to CFLKs based upon their date of manufacture. Specifically, the requirements in 10 CFR 429.33(b)(2)(ii) and (b)(3)(ii) apply to products manufactured on or after January 21, 2020, whereas those in 10 CFR 429.33(b)(2)(i) and (b)(3)(i) apply to products manufactured prior to January 21, 2020. However, the amended regulatory text as adopted by the July 22, 2022, final rule erroneously identified the compliance date in these paragraphs as January 1, 2020, rather than January 21, 2020.

As published, the regulatory text in the July 2022 final rule may result in confusion as to the applicability of specific certification provisions that apply to CFLKs. The current regulatory text is also in conflict with the current compliance date for energy conservation standards for CFLKs in 10 CFR 430.32(s)(6). Because this final rule would simply correct an error in the text without making substantive changes in the July 2022 final rule, the changes addressed in this document are technical in nature.

DOE has concluded that the determinations made pursuant to the various procedural requirements applicable to the July 2022 final rule remain unchanged for this final rule technical correction. These determinations are set forth in the July final rule. 87 FR 43952, 43973-43976.

Pursuant to the Administrative Procedure Act, 5 U.S.C. 553(b)(3)(B), DOE finds that there is good cause to not issue a separate notice to solicit public comment on the changes contained in this document. Issuing a separate notice to solicit public comment would be impracticable, unnecessary, and contrary to the public interest. Neither the errors nor the corrections in this document affect the substance of the July 2022 final rule or any of the conclusions reached in support of the final rule. Providing prior notice and an opportunity for public comment on correcting objective, typographical errors that do not change the substance of the test procedure serves no useful purpose.

Further, this rule correcting a regulatory text error makes non-substantive changes to the test procedure. As such, this rule is not subject to the 30-day delay in effective date requirement of 5 U.S.C. 553(d) otherwise applicable to rules that make substantive changes.

This document of the Department of Energy was signed on August 26, 2022, by Dr. Geraldine L. Richmond, Undersecretary for Science and Innovation, pursuant to delegated authority from the Secretary of Energy. That document with the original signature and date is maintained by DOE. For administrative purposes only, and in compliance with requirements of the Office of the Federal Register, the undersigned DOE Federal Register Liaison Officer has been authorized to sign and submit the document in electronic format for publication, as an official document of the Department of Energy. This administrative process in no way alters the legal effect of this document upon publication in the Federal Register .

For the reasons stated in the preamble, DOE corrects part 429 of chapter II, subchapter D, of title 10 of the Code of Federal Regulations by making the following correcting amendments:

The following section briefly discusses the statutory authority underlying this final rule, as well as some of the relevant historical background related to the inclusion of MGPs as covered equipment under the Energy Policy and Conservation Act (“EPCA”), as amended.

EPCA  1 authorizes DOE to regulate the energy efficiency of a number of consumer products and certain industrial equipment. Title III, Part B  2 of EPCA established the Energy Conservation Program for Consumer Products Other Than Automobiles, which sets forth a variety of provisions designed to improve energy efficiency for certain consumer products, referred to generally as “covered products”. 3 In addition to specifying a list of consumer products that are covered products, EPCA authorizes the Secretary of Energy to classify additional types of consumer products as covered products. EPCA defines a “consumer product” in relevant part as any article (other than an automobile) of a type—(A) which in operation consumes, or is designed to consume, energy; and (B) which, to any significant extent, is distributed in commerce for personal use or consumption by individuals; without regard to whether such article of such type is in fact distributed in commerce for personal use or consumption by an individual. 4 (42 U.S.C. 6291(a)(1)) For a given consumer product to be classified as a covered product, the Secretary must determine that: classifying the product as a covered product is necessary or appropriate to carry out the purposes of this chapter; and the average annual per-household energy use by products of such type is likely to exceed 100 kilowatt-hours (“kWh”) (or its British thermal unit (“Btu”) equivalent) per year. (42 U.S.C. 6292(b)(1))  5

When attempting to cover additional consumer product types, DOE must first determine whether these criteria from 42 U.S.C. 6292(b)(1) are met. Once a determination is made, the Secretary may prescribe test procedures to measure the energy efficiency or energy use of such product. (42 U.S.C. 6293(a)(1)(B)) Furthermore, once a product is determined to be a covered product, the Secretary may set standards for such product, subject to the provisions in 42 U.S.C. 6295(o) and (p), provided that DOE determines that four additional criteria at 42 U.S.C. 6295(l) have been met. Specifically, 42 U.S.C. 6295(l) requires the Secretary to determine that: the average household energy use of the products has exceeded 150 kWh per household for a 12-month period; the aggregate 12-month energy use of the products has exceeded 4,200 gigawatthours; substantial improvement in energy efficiency of products of such type is technologically feasible; and application of a labeling rule under 42 U.S.C. 6294 is unlikely to be sufficient to induce manufacturers to produce, and consumers and other persons to purchase, covered products of such type (or class) that achieve the maximum energy efficiency that is technologically feasible and economically justified. (42 U.S.C. 6295(l)(1))

On February 7, 2022, DOE published a notice of proposed determination (“NOPD”) that proposed to determine coverage for MGPs, which are consumer products comprising: (1) Those hearth products that are not direct heating equipment (“DHE”) ( i.e., those hearth products that are indoor or outdoor decorative hearth products) and (2) outdoor heaters. 87 FR 6786 (“February 2022 NOPD”). The rulemaking history of MGPs as well as hearth products is discussed in the February 2022 NOPD. 87 FR 6786, 6787—6788.

DOE developed this determination after considering comments, data, and information from interested parties that represent a variety of interests. Table II.1 lists the interested parties that provided comments on the February 2022 NOPD.

MGPs as considered in this final determination are comprised of decorative hearth products and outdoor heaters. In the February 2022 NOPD, DOE proposed to define a “decorative hearth product” as a gas-fired appliance that:

• Simulates a solid-fueled fireplace or presents a flame pattern;

• Includes products designed for indoor use, outdoor use, or either indoor or outdoor use;

• Is not designed to be operated with a thermostat;

• For products designed for indoor use, is not designed to provide space heating to the space in which it is installed; and

• For products designed for outdoor use, is not designed to provide heat proximate to the unit. 87 FR 6786, 6790. A wide range of decorative hearth products are available on the market, including, for example, gas log sets, gas fire pits, gas stoves, and gas fireplace inserts. Decorative hearth products may be used indoors or outdoors.

In the February 2022 NOPD, DOE proposed to define an “outdoor heater” as a gas-fired appliance designed for use in outdoor spaces only, and which is designed to provide heat proximate to the unit. 87 FR 6786, 6790.

In response to the definition for outdoor heaters proposed in the February 2022 NOPD, HHT commented that the proposed definition for outdoor heaters is very broad as it covers radiant heaters, firepits, and outdoor fireplaces. HHT added that the majority of the products in this category are for aesthetic appeal and not for use as a local heat source. (HHT, No. 9 at p. 2)

HPBA commented that the definition of outdoor heaters is vague, overbroad, unjustified, and susceptible to potential abuse. HPBA stated that if DOE intends to cover products other than gas-fired outdoor infrared patio heaters subject to the [American National Standards Institute (ANSI)] Z83.26 standard, they must be identified and a justification for their coverage provided. (HPBA, No. 11 at pp. 47-48) HPBA added that the definition is overbroad because it includes portable and non-portable units subject to ANSI Z83.26. HPBA stated that these two categories of products are too different in their design and constraints to be considered a single product. HPBA suggested that a heating efficiency standard for any of these products should be limited to strictly utilitarian heating products and should exclude “patio heaters.” Further, HPBA stated that patio heaters are not strictly utilitarian as they provide outdoor lighting or visual appeal and are likely to be compromised by high heating efficiencies. ( Id. at p. 48)

Moroz commented that patio heaters are the only outdoor appliance that should be covered as outdoor heaters, and stated that gas fireplaces and gas fire pits serve as decorative appliances, and should not be considered outdoor heaters. Moroz commented that they are only aware of outdoor gas fireplaces for decorative use, as opposed to being intended as heaters. Moroz questioned the benefit of regulating the efficiency of an appliance that emits heat directly to the atmosphere. (Moroz, No. 7 at p. 1)

The definition of outdoor heaters, as DOE proposed to define it in the February 2022 NOPD and as adopted in this final determination, could include products such as patio heaters, outdoor fire pits, and outdoor fireplaces, so long as they are designed to provide heat to the space around the unit. (DOE notes that were such products not designed to provide heat to the space proximate the unit, they may instead be classified as decorative hearth products.) Therefore, DOE clarifies that products other than patio heaters could meet the definition of outdoor heaters, if those products are designed for use in outdoor spaces and designed to provide heat to the space proximate the unit. In contrast to the assertions by commenters that the definition is overbroad, DOE notes that products must meet specific criteria to be considered an outdoor heater—be designed for installation in outdoor spaces only, and be designed to provide heat proximate to the unit. If a product does not meet both aspects of this definition it would not be an “outdoor heater”. Regardless of whether a product is marketed as a “patio heater” or some other term, or if it is certified to ANSI Z83.26 or another standard, it would be covered as an “outdoor heater” if it meets both parts of this definition. A product that is designed for installation outdoors, but that is not designed to provide heat proximate to the unit may be classified as a decorative hearth product if all other definitional criteria for decorative hearth product were met.

Moroz commented that an outdoor heater is operated when outdoor temperatures cause personal discomfort, and a decorative hearth appliance is operated when the user wishes to enjoy the ambiance created by the flame of the appliance. (Moroz, No. 7 at p. 2) HPBA suggested that patio heaters may produce a combination of heat, lighting, and/or visual appeal. (HPBA, No. 11 at p. 53) As noted above, outdoor products may be outdoor heaters or decorative hearth products, depending on whether they are designed to provide heat proximate to the unit.

AHRI commented that manufacturers of fixed installation infrared outdoor heating equipment may approve their products to ANSI Z83.19, ANSI Z83.20, and ANSI Z83.26. AHRI further stated that heaters certified to these standards should be excluded from the definition of “outdoor heaters”. They commented that these standards set minimum radiant energy requirements and that, pursuant to 42 U.S.C. 6295(l), DOE would be required to demonstrate that a substantial improvement in energy efficiency is technologically feasible for such products. (AHRI, No. 16 at pp. 1-2) AHRI commented that the ANSI Z83.19 standard, Gas-Fired High-Intensity Infrared Heaters, is limited in its application to indoor non-residential and outdoor use and sets a minimum requirement for the radiant coefficient, which must be measured. ( Id. ) AHRI also stated that a fixed installation product that has been tested and certified to meet ANSI Z83.19 may in some instances choose to include additional certification to ANSI Z83.26, but that ANSI Z83.26 is not applicable to fixed installation heaters. ( Id. ) AHRI stated that the majority of heaters approved to ANSI Z83.19 are for industrial and commercial indoor use only although it may include coverage for outdoor use. AHRI commented that fixed installation outdoor heaters should be excluded from the proposed coverage determination because they are primarily certified to ANSI Z83.19 and ANSI Z83.20, which have provisions for minimum radiant energy measurement. ( Id. ) Moreover, AHRI commented that any heater primarily certified to ANSI Z83.19 and Z83.20 with additional certification to Z83.26 should be excluded from the scope of this rulemaking. ( Id. )

AHRI commented that DOE should use industry consensus definitions for these products from appropriate industry standards to avoid products falling in and out of multiple classifications. ( Id. ) Additionally, AHRI commented that the definition of outdoor heaters should specify that their primary purpose is providing proximate heat and that such units are not an otherwise covered product. AHRI stated that without this specification, DOE may risk including otherwise unrelated covered products into the scope of its determination. ( Id. )

The definition of “outdoor heater” proposed in the February 2022 NOPD and adopted in this final determination specifies that these products are “designed to provide heat proximate to the unit.” DOE notes that pursuant to 42 U.S.C. 6295(l), as discussed in section I.A, DOE is required to determine substantial improvement in energy efficiency is technologically feasible for any type (or class) of covered products. This coverage determination defines “miscellaneous gas products” as a covered product, which includes outdoor heaters, but DOE is not analyzing potential energy conservation standards in this notice. DOE will consider the technical feasibility, energy savings, and economic justification of potential energy conservation standards in a separate standards rulemaking. Furthermore, the requirement in EPCA that substantial energy efficiency improvement is technologically feasible is determined with respect to MGPs as a whole, including all products that would meet the definitions of outdoor heaters and decorative hearth products.

DOE acknowledges that the ANSI Z83.19  6 and ANSI Z83.20  7 standards cover heaters “intended for installation in and heating outdoor spaces or nonresidential indoor spaces”. However, as discussed in section II.A.3, the definition of “consumer product” as defined in 42 U.S.C. 6291(1) does not exclude coverage based on use in commercial applications as long as a product is, “to any significant extent, distributed in commerce for personal use or consumption by individuals”. Therefore, products that are distributed to a significant extent for residential use are appropriately classified as consumer products under EPCA. Additionally, 42 U.S.C. 6311(2)(A)(iii) specifies that the term “industrial equipment” excludes a product which is a “covered product” as defined in section 6291(a)(2)”. Thus, outdoor heaters meeting the definition established under this rule will not be subject to both the consumer product and industrial equipment provisions of EPCA. Additionally, 42 U.S.C 6295(l) specifies the criteria that DOE must satisfy in order to set standards for consumer products that the Secretary classifies as covered products, and whether or not such products are subject to industry standards or efficiency metrics is not a listed criterion.

In response to the definition for “decorative hearth product” initially proposed in the February 2022 NOPD (see section II.A of this document), Moroz commented that “decorative hearth products” is too broad of a term and that the definitions found in the Canadian Regulation for Gas Fireplaces  8 are more specific and appropriate, and that DOE should align with the Canadian regulations where applicable. (Moroz, No. 7 at p. 1) OGC commented that “decorative hearth products” is too broad of a term to use for both indoor and outdoor decorative products that must comply with very different industry standards. OGC also commented that the primary function of outdoor decorative hearth products is the aesthetic qualities of their flame, and not the production of heat. OGC also commented that “outdoor hearth products,” as a category of products, was not defined in the scope of coverage in the February 2022 NOPD. (OGC, No. 8 at pp. 1-2) HHT commented that the primary function of the majority of hearth products is to have aesthetically appealing flames, as opposed to heating. (HHT, No. 9 at p. 2) Similarly, HPBA stated that fireplaces and similar products inherently produce heat and are designed “to be suitable for utilitarian use,” but they nevertheless state that these products cannot be reasonably regulated as utilitarian heating products. HPBA commented that it is an invalid assumption that products that produce heat are “heaters” and would be improved by a higher heating efficiency. HPBA also stated that gas fireplaces or similar products are not “purely decorative” because it is incorrect to assume that these products are not intended to provide heat. (HPBA, No. 11 at pp. 46-47)

As noted in the February 2022 NOPD, a variety of products, such as gas log sets, gas fire pits, gas stoves, and gas fireplace inserts (among others) could be considered as decorative hearth products if they meet all the definitional criteria. 87 FR 6786, 6788. DOE further notes that the decorative hearth products, as defined, can be marketed for use both indoors and outdoors. However, DOE may consider the relevant differences in indoor and outdoor products in any future analysis of potential test procedures and energy conservation standards for these products.

In response to comments stating that the function of hearth products can include aesthetics as well as heating, DOE notes that under its definition, decorative hearth products are not designed to provide heating to the space in which they are installed (indoor units) or the space proximate the heater (outdoor units). Although decorative hearths may give off some heat as a byproduct of the flame, the aesthetic appeal is what the product is designed to be used for, rather than the heating function.

HPBA commented that vented gas log sets are set apart from vented gas fireplaces by their unmatched realism and design for installation directly into the hearth of existing wood-burning fireplaces. HPBA stated that manufacturers work to minimize the visibility of hardware components to maximize realism in these products. HPBA added that electronic ignition systems require significant additional hardware, some of which is heat-sensitive, and compromise the visual appeal of the product. (HPBA, No. 11 at p. 40) HPBA stated that while gas log sets are the most “decorative” of all indoor products and may have little net heating utility in a normally heated home, they provide emergency heating utility when central heating systems are out. HPBA commented that continuous pilot lights, unlike electric ignition, are able to operate in an electrical outage. Further, HPBA stated that battery backup systems require much more vigilance with respect to battery replacement and that they require heat-sensitive hardware which may make them less suitable for emergency situations. ( Id. at p. 41) HPBA commented that during weather disasters, batteries are often in short supply and a gas log set with a continuous pilot light could be useful. HPBA commented that a continuous pilot ban for vented gas log sets would impose regulatory burdens on products for which there are no regulatory benefits. ( Id. at p. 42) HPBA commented that vented gas log sets certified to the ANSI Z21.84 standard operate by direct main burner ignition, by definition, cannot have continuous pilot lights. HPBA stated that these products should not be subject to regulation because they do not have continuous pilot lights. ( Id. )

HPBA also commented that the volume of the flame is important for the fireplace installation to “look right” and that this feature is proportional to British thermal units (“Btu”) input. Therefore, HPBA states, important visual considerations effectively define a range of Btu inputs for a given installation. HPBA commented that heat output should not classify whether a product is a “heater” or “purely decorative” because flame art can have high heat outputs but should not be confused with utilitarian heating appliances. (HPBA, No. 11 at p. 51)

DOE notes that the definition for decorative hearth product does not prescribe a limit on Btu input for fireplaces to distinguish products that are a “heater” from those that are “purely decorative.” When classifying products, the intended design of the product is the criteria used for categorization, allowing fireplaces with high Btu input rates to continue to be classified as a decorative hearth product if all other definitional elements are met.

In the February 2022 NOPD, DOE tentatively determined that the presence of a thermostat indicates that a product is designed to provide heat rather than being purely decorative. Thus, the proposed definition of decorative hearth products excluded those products equipped with a thermostat. This determination was consistent with the relevant ANSI standard for decorative gas fireplaces ( i.e., ANSI Z21.50, “Vented Decorative Gas Appliances”), which excludes products that are equipped with a thermostat. DOE requested comment on whether the presence of a thermostat would indicate that a hearth product is intended to provide heat to the space in which it is installed rather than being purely decorative. 87 FR 6786, 6790.

In response to the February 2022 NOPD, Moroz commented that it is inappropriate to assume that the presence of a thermostat always indicates that a hearth product is intended to provide heat to the space in which it is installed. Moroz commented that thermostats can provide automatic control of heat balance within the home, and in some cases act as a safety device. Moroz stated that while not currently applicable in the National Fire Protection Association (NFPA) 54, [“National Fuel Gas Code”], which the commenter suggests is the American installation code for gas appliances, CSA B149[.1] [“Natural Gas and Propane Installation Code”], which the commenter suggests is the Canadian installation code for gas appliances, requires that a thermostat be installed on a gas fireplace when used in a bedroom in order to intervene when a user is not conscious of the appliance's operation. (Moroz, No. 7 at p. 1)

Similarly, HHT commented that thermostat allowance and usage is determined by the standard a unit is certified to. HHT added that thermostats are a device for comfort control and does not mean that those products are meant for use as a primary heating source. (HHT, No. 9 at p. 1) OGC also commented that the use of a thermostat on a product is covered by the industry standard that the product is listed to. (OGC, No. 8 at p. 1) NPGA commented that a thermostat feature may be provided by manufacturers to assist consumers in measuring the intensity of the product but without the intention for consumers to utilize the product as a direct heating or space heating appliance. NPGA recommended that DOE consider defining decorative heath products by the purpose(s) and feature(s) present in the product instead of by the absence of a feature, or by disqualifying products according to the presence of a feature. (NPGA, No. 14 at p. 3)

HPBA commented that thermostats on fireplaces and similar products can be used to turn a product on and off in response to heating demands or simply to prevent unintended overheating from non-utilitarian use. HPBA added that thermostats are not permitted on products certified to the ANSI Z21.50 standard but the presence of a thermostat does not indicate that such products are “heaters” or that they would be improved by a higher heating efficiency. (HPBA, No. 11 at p. 47)

DOE appreciates this feedback regarding the presence of a thermostat as an indicator that a hearth product is intended to provide heat to the surrounding space. DOE notes that the ANSI Z21.50 for vented gas decorative appliances specifies that the appliances are not for use with a thermostat. Additionally, in its energy efficiency regulations, NRCan defines “decorative gas fireplace” as a vented fireplace that is fueled by natural gas or propane, is marked for decorative use only and is not equipped with a thermostat or intended for use as a heater. 9 In an effort to align with industry standards and Canadian regulations, DOE concludes that it is appropriate to use the absence of a thermostat as a criterion for decorative hearth products. However, to fully align with ANSI Z21.50, DOE is adopting a slight modification to criteria (3) in the definition of “decorative hearth products” to read “is not for use with a thermostat.”  10 DOE reasons that this slight modification, while not changing the intent of the definition proposed in the February 2022 NOPD, will fully align with the language of the industry standard and further clarify the meaning of the definition to exclude from decorative hearth products those products that are used with a thermostat.

HPBA commented that outdoor gas log sets differ from vented gas log sets because they include “match-lit” products (which are not used indoors due to safety concerns), they are operable under the variable conditions encountered outdoors, and they do not necessarily need to be installed in existing fireplaces with functioning flue systems. (HPBA, No. 11 at pp. 43-44) DOE appreciates this feedback regarding vented gas log sets and the distinction from outdoor gas log sets. However, as discussed previously, these products are covered as decorative hearth products if they meet the criteria outlined in the definition. DOE may consider the differences in these products in any future analysis of potential test procedures and/or energy conservation standards for MGPs.

In response to the February 2022 NOPD, HHT stated that the scope of coverage for MGPs is too broad and combines products that are used for aesthetic or decorative purposes with products used for heating. (HHT, No. 9 at p. 2)

Similarly, Moroz commented that “miscellaneous gas products” is too vague of a title and should not include decorative hearth products, outdoor gas fireplaces, and outdoor heaters all within the same classification, but rather coverage of products should be more specific. (Moroz, No. 7 at pp. 2-3) OGC similarly commented that “miscellaneous gas products” is too broad and mixes products that are primarily aesthetic and provide some comfort and illumination with products whose only utility is to provide heat. OGC suggested that DOE is attempting to cover any gas burning product with a visible flame regardless of its intended purpose. (OGC, No. 8 at p. 2)

HPBA stated that neither “outdoor heaters” nor “decorative hearth products” are identifiable products; rather, HPBA stated they are a mishmash of products with little resemblance to one another. HPBA suggested that Congress did not intend for DOE to classify new products in this amorphous manner. (HPBA, No. 11 at pp. 22-23) Additionally, HPBA stated that DOE should abandon its definition-based approach to coverage determinations and instead use clear and precise details when describing a product. (HPBA, No. 11 at pp. 17-18) HPBA suggested that a descriptor similar to “vented gas products certified to the ANSI Z21.88 standard” would provide appropriate clarity and precision. ( Id. at pp. 17-18) HPBA also stated that DOE cannot avoid the need for a coverage determination by “interpreting” a category of currently regulated products to include previously unregulated products, nor can it justify coverage for one product and assert coverage over another. ( Id. at pp. 15-16) HPBA also stated that issuing a coverage determination requires product-specific consideration of issues to avoid products not reasonably susceptible to EPCA regulation from being swept into coverage along with other products and the gas usage of different products could be combined to meet EPCA's requirements at 42 U.S.C. 6262(b)(1)(B). ( Id. at p. 18)

NPGA expressed agreement with the comment submitted by HPBA that a more specific definition of the products potentially subject to the rulemaking and of the efficiency objectives would benefit the current rulemaking. (NPGA, No. 6 at pp. 1-2) NPGA discouraged DOE from including decorative hearth products and outdoor heaters in the same category of MGPs because their primary function and features differ, even though there may be some overlap in their function. NPGA expressed concern for such wide encompassing definitions of MGPs because it may make some products immediately unable to meet a potential standard based solely on design limitations. ( Id. at p. 2) NPGA commented that the DOE's rationale is difficult to understand and identify the value to be achieved by combining product types with different functionality and design. NPGA further added that, while the notice acknowledges that outdoor heaters and decorative products are different, an explanation for combining them is not offered. ( Id. at p. 2) NPGA requested that the DOE separate decorative hearth products and outdoor heaters, and provide a narrower definition of the product types such as the differences between an outdoor fire table and an outdoor heater which may have different operating capacities and operating hours. ( Id. at p. 4) NGPA suggested that DOE should remove outdoor heaters from the definition of MGPs. ( Id. at p. 2)

AHRI opposed the inclusion of decorative hearths and outdoor heaters in the same rulemaking. (AHRI, No. 16 at p. 3) AHRI commented that if DOE includes these products under the scope of coverage, it should perform separate rulemakings for decorative products covered by ANSI Z21.50, Z21.60, Z21.84, and Z21.97, and for outdoor heaters covered by ANSI Z83.26 to provide better clarity on regulations and simplify test procedures and performance criteria. ( Id. at p. 5) AHRI added that outdoor heaters and decorative hearths have fundamentally different utility under the proposed definitions for which, they stated, one must provide heating and the other cannot provide heating, as well as differences in terms of market distribution and aggregate national energy use. ( Id. at pp. 2-3)

The CA IOUs recommended that DOE should carefully develop complementary definitions for “decorative hearth products” and “vented hearth heaters” to ensure appropriate coverage of products currently on the market. (CA IOUs, No.12 at p. 2) The CA IOUs commented that the shared appearance and performance characteristics of the various MGPs is highlighted by industry testimony (specifically, a comment submitted by HPBA) during the California Energy Commission's Title 20 rulemaking process that indicated that performance standards for vented hearth heaters could result in the reclassification of a “vast majority” of heating products as decorative hearth products. The CA IOUs suggested that the ability to recertify products under different test procedures reinforces the need for complementary product definitions that provide appropriate coverage for all hearth products. ( Id. )

In addition, AHRI stated that MGPs would combine multiple product types across both residential and commercial applications and that it is unclear if the coverage of outdoor heaters is aimed at commercial or residential products. AHRI stated that it is unclear why “commercial heating equipment” would be included in a standard for residential decorative hearths. (AHRI, No. 16 at pp. 2-3) They also stated, it appears as though the only motivation to group decorative hearths and outdoor heaters together is because separately, outdoor heaters would not meet the threshold for regulation. Id. In addition, AHRI stated that MGPs would combine multiple product types across both residential and commercial applications and that it is unclear if the coverage of outdoor heaters is aimed at commercial or residential products. HPBA similarly commented that while they are not familiar with non-portable infrared patio heaters, the coverage of these products as consumer products is not justified because many of these products are overwhelmingly used by commercial purchasers. HPBA stated that it appears that these products are rarely purchased or used by household consumers. (HPBA, No. 11 at pp. 48-49)

DOE finds that MGPs are similar enough in function and operation that it is appropriate to group them together. Decorative hearth products are gas-fired products that meet the criteria discussed in section II.A of this determination. The definition of decorative hearth products groups together all products that perform the same basic function—simulating a solid-fuel fireplace and/or presenting an aesthetic flame pattern while not being designed to heat the surrounding space—regardless of whether they are described in the marketplace as being a “gas fireplace insert”, “gas log set”, or some other term. While products such as gas logs, gas fireplace inserts, gas stoves, or other decorative hearth products may have distinct operational or design characteristics, DOE finds that the products are similar enough in function and operation that it is appropriate to group them all under a single definition of decorative hearth products for the purposes of this final determination because they all serve the same purpose of simulating a solid-fuel fireplace and/or presenting and aesthetic flame pattern while not being designed to heat the surrounding space. As noted previously, decorative hearth products can be designed for indoor or outdoor use ( i.e., these products include indoor decorative hearth products and outdoor decorative hearth products).

As noted by commenters, all hearth products, including those that are decorative and are not designed to provide a significant amount of heat to the surrounding space, produce some amount of heat even if it is not their primary function. Grouping indoor decorative hearths and outdoor decorative hearths is appropriate because, as noted, they have similar forms and functions. Outdoor hearths and outdoor heaters are also similar in that they are gas-fired products that are used outdoors and may provide aesthetic value to consumers (in particular, outdoor hearths and outdoor heaters with visible flames may be considered substitute products for many consumers), and therefore grouping these products is also appropriate. Outdoor heaters without flames are very similar to those with flames. DOE's analysis of MGPs as a covered products assessed outdoor heaters, which it defines as products that are gas-fired appliances designed for use in outdoor spaces only, and which are designed to provide heat proximate to the unit. Some outdoor heaters meeting DOE's definition have visible flames and some do not.

Furthermore, DOE disagrees with the assertion that its motivation in grouping these products was related to annual energy use thresholds. As discussed above, DOE believes these products are appropriately grouped based on their function and operation. In the February 2022 NOPD, DOE estimated that both outdoor heaters and decorative hearth products individually meet the energy use threshold under 42 U.S.C. 6292(b)(1)(B). 87 FR 6792. Aggregate annual energy use was not a factor in determining the scope of MGPs. Should DOE proceed with a rulemaking to establish energy conservation standards, DOE would determine if MGPs satisfy the energy use threshold provisions at 42 U.S.C. 6295( l )(1) during the course of that rulemaking.

DOE did not include ANSI safety certifications into its definitions of miscellaneous gas products, decorative hearth products, or outdoor heaters because DOE understands that many hearth products could be certified to various or multiple standards, and defining product classifications based on the safety standard could allow products to change classification if their certification standard were changed. Additionally, it could be possible for hearth products to not indicate the ANSI standard to which it is certified.

In response to the suggestion that many outdoor heaters would more appropriately be classified as commercial products, DOE notes that EPCA defines “consumer product,” in part, as an article that “to any significant extent, is distributed in commerce for personal use or consumption by individuals.” (42 U.S.C. 6291(1)). Standards established for MGPs as a consumer product under EPCA would, therefore apply to any MGP distributed to any significant extent as a consumer product for residential use. Although many outdoor heaters (and other types of MGPs) can be used in commercial settings, they are appropriately classified as consumer products because many of these products are also distributed in commerce for residential use.

In response to the February 2022 NOPD, HPBA commented that although the coverage of any MGPs is not warranted; coverage for propane-fueled products would be even harder to justify for many of these products. (HPBA, No. 11 at p. 51) HPBA added that many prefabricated outdoor fireplaces use propane as fuel, and consumers are directed to close the valves on the propane cylinders when the product is not in use and the potential for unnecessary pilot light use would be limited by the volume of the cylinder. ( Id. at pp. 45, 53)

OGC commented that propane-fueled decorative hearth products and outdoor heaters should not be within the scope of coverage because the relatively high cost of propane and the user understanding that products operated on bottled propane are operated on a limited supply of fuel already encourages users to practice energy conservation and monitor their usage. (OGC, No. 8 at p. 2) AHRI commented that for portable or free-standing propane heaters, it would be unlikely that a standing pilot would be left on as it would drain the propane tank when the heater was not in use. (AHRI, No. 16, p. 5) Similarly, HHT and NPGA commented that propane fuel usage is already regulated by the size of the container it is sold in or used out of. (HHT, No. 9 at p. 2; NPGA, No. 14 at p. 4) Therefore, NPGA concluded that the energy use of propane-fueled decorative hearth products or outdoor heaters is determined by the consumer rather than an efficiency standard. (NPGA, No. 14 at p. 4)

Conversely, Moroz commented that the inclusion of propane-fueled decorative hearth products and outdoor heaters should be done only to harmonize with NRCan regulations for hearth appliances. (Moroz, No. 7 at p. 2) AGH commented that they support the inclusion of propane products within the scope of the proposed coverage determination of MGPs. The commenter stated that stoves and fireplaces that use propane are often nearly identical to ones that use natural gas and are very popular in areas not served by gas pipelines. AGH stated that companies that produce natural gas appliances also produce propane appliances and the regulation of one without the other would create a confusing and artificial distinction. AGH added that the cost of propane is typically higher than natural gas; therefore, consumers could benefit from transparent and minimum efficiency ratings. (AGH, No. 10 at p. 2) The Joint Commenters also expressed their support for the inclusion of propane products in the scope of proposed coverage determination for MGPs. (Joint Commenters, No. 13 at p. 1) The Joint Commenters referenced a 2017 Lawrence Berkley National Laboratory Hearth Study that showed that 59 percent of hearth products use natural gas and 17 percent use propane and suggested that they expect the proportion of decorative hearth products that use propane to be similar and that the inclusion of propane products may represent significant energy savings. The Joint Commenters also noted their market review findings that one large retailer listed 151 models of propane-fueled units and 23 models of natural gas-fueled outdoor heaters while another large retailer's website listed 352 models of propane-fueled units and 56 models of natural-gas fired outdoor heaters. ( Id. at pp. 1-2)

DOE defines the term “gas” to mean either natural gas or propane in 10 CFR 430.2. Therefore, based on the existing definition of “gas,” MGPs would include propane-fueled outdoor heaters and decorative hearth products. However, should test procedures and energy conservation standards for MGPs be considered in the future, DOE may consider whether propane-fueled products warrant different treatment under test procedures and energy conservation standards than natural gas-fueled MGPs.

OGC commented that unvented indoor products must be certified to ANSI Z21.11.1 and that whether the product is used primarily as heat or for its decorative qualities is determined by the user. (OGC, No. 8 at p. 3) Moroz commented that because the heat from combustion in an unvented gas fireplace is distributed into the surrounding living space, it is appropriate for them to be classified as heaters. (Moroz, No. 7 at p. 2) HHT stated that they are not aware of any unvented hearth product that is solely decorative and that the ability of a product to provide sufficient heat for a space is dependent on the space in which it is installed. HHT stated that it is not aware of any characteristics that differentiate purely decorative unvented indoor hearth products from unvented heaters. (HHT, No. 9 at p. 2) HPBA stated that heating output does not provide a distinction between different categories of vent-free fireplaces or log sets. (HPBA, No. 11 at p. 51) HPBA stated that vent-free gas fireplaces and log sets, which have an inherently high heating efficiency because they release all of their heat to the space, may be chosen because of ease of installation or because they may be the only practical option. ( Id. at pp. 51-52) DOE is not aware of any purely decorative unvented hearth products and agrees that unvented indoor products are not decorative hearth products as defined in this determination. Hearth heaters, including unvented hearth heaters, are separately regulated products and DOE is in the process of considering standards for these products in a separate rulemaking (see docket EERE-2022-BT-STD-0018).

In response to the February 2022 NOPD, HHT commented that the following industry standards should be reviewed for the coverage determination for decorative hearth products and outdoor heaters: ANSI Z21.50, Z21.84, Z21.11, Z83.26, Z21.60, Z21.97, Z83.19. (HHT, No. 9 at p. 1) OGC commented that the industry standards covered in the February 2022 NOPD are adequate to cover the different product types identified. (OGC, No. 8 at p. 1)

DOE reviewed the scope of ANSI Z21.50, ANSI Z21.60, ANSI Z21.84, ANSI Z21.97, and ANSI Z83.26 to inform the proposed scope of coverage of MGPs in the February 2022 NOPD. 87 FR 6786, 6788-6789. DOE has also since identified products certified to ANSI Z21.11 and ANSI Z83.19 and reviewed the scope of these standards as well. As appropriate, DOE used provisions from these ANSI standards to inform its understanding of appropriate product categorizations, but, as discussed in section II.A.3, DOE did not include ANSI safety certifications into its definitions of miscellaneous gas products, decorative hearth products, or outdoor heaters because this could lead to inconsistent classifications.

HPBA asserted that no gas fireplace products qualify as DHE. The commenter added that fireplace products are not included in any of the 16 DHE product categories, nor do they resemble products that are DHE. Further, HPBA stated that EPCA does not give DOE authority to create additional categories of DHE. (HPBA, No. 11 at pp. 19-21)

DOE notes that MGPs are a separate consumer product category from DHE, and that DHE are not at issue in this coverage determination rulemaking. Indeed, in its decision for Hearth, Patio & Barbecue Association v. Department of Energy, et al. 706 F.3d 499 (D.C. Cir. 2013), the United States Court of Appeals for the District of Columbia Circuit held that the phrase “vented hearth heater” did not encompass decorative fireplaces as that term is traditionally understood. As discussed in the February 2022 NOPD, DOE believes that classifying vented hearth heaters as vented home heating equipment would be consistent with the Court's opinion, in that vented hearth heaters provide space heating. Therefore, DOE concluded that although there are not currently energy conservation standards for vented hearth heaters, these products are appropriately covered as vented home heating equipment (and DHE). 87 FR 6786, 8688. However, MGPs do not include vented hearth heaters. Thus, DOE is not creating an additional category of DHE through this coverage determination, but rather is establishing a new category of separately covered products consistent with its authority under EPCA.

HPBA further commented that heating efficiency standards for vented gas fireplaces would limit the range of available products and leave many consumers without vented gas fireplaces appropriate for their needs but would not make such products better or more efficient gas fireplaces. (HPBA, No. 11 at pp. 27-28) HPBA explained that the core appeal of fireplaces is “not in their heating utility per se, but in the unique combination of features that make a fireplace a fireplace.” ( Id. )

DOE notes that consumer utility impacts of standards for vented gas fireplaces will be considered in any future energy conservation standards rulemaking, including the aesthetic appeal of fireplace features.

HPBA commented that vented gas fireplaces do not produce particulate emissions that are often characteristic of many older solid fuel fireplaces which, they stated, makes them more desirable from an air quality standpoint, particularly in the homes of individuals with respiratory problems such as asthma. (HPBA, No. 11 at p. 29) HPBA stated that, while vented gas fireplaces can have significant heating utility, few consumers regularly use their fireplace heaters for utilitarian heating purposes, and very few do so exclusively. The commenter added that better space heating options exist that are both less costly and better tailored for the purposes of strictly utilitarian heating use. ( Id. at pp. 29-30)

HPBA stated that the market for fireplaces with very high efficiency is small because there is little or no demand for fireplaces that generate too much heat. HPBA stated that one of their members found it possible to make fireplaces that utilize condensing technology to reach high heating efficiency but that the market was insufficient to sustain production of condensing gas fireplaces. (HPBA, No. 11 at p. 30)

In response to DOE's request for comments on outdoor hearth products designed to provide a large amount of heat, HPBA commented that a fireplace or similar product does not exist that is designed to provide a large amount of heat as its primary function. HPBA stated that the primary function of a fireplace or similar product is to be a fireplace or similar product. HPBA stated that although it is often part of the appeal that such products produce heat, their purpose is to be enjoyed. HPBA further added that the enjoyment is undermined if too much heat is produced. HPBA also commented that the heat output of fireplaces and similar products does not provide reasonable basis for characterization of such products as “heaters” for purposes of efficiency regulation. (HPBA, No. 11 at p. 49).

DOE notes that the definitions for MGPs cover products, in part, depending on whether or not it is designed to provide heating to the space in which it is installed. Regardless of the utilization of the product by the end consumer, the designed intention of the product by the manufacturer can be classified as to whether it is intended to provide heating. It is on this basis that DOE is not excluding vented gas fireplaces from the definition of decorative hearth products, as DOE's market research found that vented gas fireplace products that are not designed to provide space heating are available on the market.

AGH commented that efficiencies of gas stoves are often unavailable and confusing and that the database maintained by the Canadian government is the only reliable source for gas stove efficiencies. (AGH, No. 10 at p. 1) AGH stated that their interactions with retailers and manufacturers yielded contradictory and inaccurate information. AGH concluded that consumers should be cautious of efficiency claims from manufacturers and retailers and suggested that the Canadian database is more reliable. AGH commented that consumers who want to save on heating bills often use their gas stove or fireplace to heat the core of the house instead of the furnace to heat the entire house. AGH stated that gas fireplaces and stoves are often used to provide heat to homes as either a primary or secondary heat source; additionally, they stated, many retailers advertise that gas inserts can easily serve as the primary source of heat for a home and cited a manufacturer's claim that gas inserts can use “50 [percent] to 90 [percent] less gas than gas logs and up to 75 [percent] less gas than a gas furnace.”  11 Additionally, AGH stated that gas furnaces can waste up to 30 percent of their heat from leaking ducts. AGH concluded from this information that consumers could save significant amounts of money and gas if gas fireplaces and stoves are regulated under EPCA. ( Id. at pp. 1-2)

DOE conducted market research through which the DOE identified both gas stove products that are intended to provide space heating and gas stove products that are not intended to provide space heating. Therefore, DOE is not excluding all gas stoves from coverage as MGPs. DOE notes that any indoor gas stove that is designed to heat the space in which it is installed does not meet the criteria outlined in the definition of a decorative hearth product and will thereby not be covered as MGP.

AGH raised concerns that DOE may have underestimated the annual shipments of MGPs by relying on data from HPBA. AGH commented that HPBA's estimates only include appliance shipments by their member companies. They further suggested that even member companies may choose not to provide data and that some of the largest gas appliance manufacturers have dropped their HPBA membership in recent years. (AGH, No. 10 at p. 2) The Joint Commenters stated their belief that the DOE may be underestimating the annual shipments of MGPs because although it was stated in the February 2022 NOPD that the hearth product shipments were scaled from the technical support document (“TSD”) that accompanied a notice of proposed rulemaking (NOPR) proposing energy conservation standards for hearth products published on February 9, 2015 (80 FR 7082) (“the February 2015 NOPR”)  12 (“the February 2015 NOPR TSD”), they stated that it was unclear what the scaling factor was intended to represent and that the hearth product shipments reported by HPBA appear to be significantly higher than those in Table 9.3.1 of the February 2015 NOPR TSD. (Joint Commenters, No. 13 at p. 2) Further, the Joint Commenters stated that shipments of MGPs may have increased significantly due to the COVID-19 pandemic, and it is therefore, believed by the commenters that the number of annual shipments is underestimated by DOE. ( Id. )

The CA IOUs added that the use of hearth products is continuing to increase in California and is anticipated to do so through the year 2035. (CA IOUs, No. 12 at p. 1)

DOE notes that it used the shipment data available at the time of the February 2022 NOPD to develop the estimates of energy consumption. In the Request for Information on Energy Conservation Standards for Miscellaneous Gas Products published on June 14, 2022 (“June 2022 RFI”), 13 DOE requested updated shipment figures for decorative hearth products and outdoor heaters. 87 FR 35925. In response to the Joint Commenters, DOE notes that the shipment data for gas appliances reported by HPBA comprise more products than only decorative hearths, therefore some of the HPBA shipments are excluded from DOE's estimates for decorative hearths. HPBA provided DOE with shipments of hearth products for the February 2015 NOPR, which are available in Chapter 9 of the February 2015 NOPR TSD. These shipments reflect the number of decorative hearths and hearth heaters shipped by HPBA members from 2005 to 2013. DOE took these shipments and compared them to overall gas appliance shipments reported by HPBA  14 during that time and, on average, decorative hearths and hearth heaters accounted for 68 percent the HPBA reported total annual hearth industry shipments. DOE applied this 68 percent to HPBA shipments of gas appliances beyond 2013  15 to develop a stock of hearth heaters and decorative hearths in 2022. To develop a stock of decorative hearths for the February 2022 NOPD, DOE assumed that 39 percent of total decorative hearths and hearth heater shipments were decorative. This is the same percentage that was used to estimate decorative shipments in the analysis supporting the February 2015 NOPR. DOE understands that the COVID-19 pandemic may have increased the demand for MGP products including outdoor heaters and DOE may consider future growth of product shipments in a standards analysis.

OGC commented that DOE needs to demonstrate that an improvement in efficiency is feasible to conserve energy resources in order to cover a product, which OGC stated had not been done in the proposed determination. (OGC, No. 8 at p. 2) NPGA stated that they were unable to evaluate the potential benefits, energy savings, or improvements for consumers because the scope of products potentially subject to the February 2022 NOPD is overly broad. (NPGA, No. 14 at pp. 2, 3, and 5)

HPBA commented that the “outdoor heater” and “decorative hearth” definitions are not clear enough to know which product operating hours should be compared. HPBA added that the operative hours of “decorative hearths” should not be compared to anything because the products which are included are too diverse and that the estimate of operating hours of “decorative hearths” would not be representative of any particular product included. (HPBA, No. 11 at pp. 52-53) Specifically, HPBA commented that fireplaces are architectural features that add to the appeal and market value of a home whether or not they are used. HPBA added that a substantial percentage of fireplaces see little or no active use. (HPBA, No. 11 at pp. 29, 31) The CA IOUs commented that the performance standards for MGPs can deliver cost-effective savings for Californians and contribute to a significant reduction of greenhouse gas emissions nationally. The CA IOUs commented that MGPs can operate for many years and stated that DOE's assumption that the lifetime of these products is fifteen years is supported by analysis and interviews in both California and Canada; therefore, they stated, DOE should begin regulation of these products as soon as possible. (CA IOUs, No. 12 at p. 1)

In response to the February 2022 NOPD, NPGA cautioned the DOE against defining scope or standards according to the presence of a standing pilot light. NPGA commented that for propane-powered outdoor heaters, a push-button or dial control connected to a pilot are designed for consumer safety and ease of ignition. NPGA added that unlike indoor products powered by natural gas, propane-powered outdoor heaters are not designed for pilot lights to remain on indefinitely. NPGA stated that clarification is needed as to why the DOE would find the ignition system breakdowns for outdoor heaters or standing pilot operating hours data for outdoor heaters to be useful information or impactful upon energy conservation standards. (NPGA, No. 14 at p. 4)

OGC commented that ignition systems and operation for outdoor products differs from that of indoor products and that DOE's energy usage calculations for these products are therefore incorrect. OGC stated that outdoor heaters use either an electronic ignition or a thermo-electric safety valve. The commenter stated that electronic ignition systems either ignite the main burner directly or may ignite a pilot burner that ignites the main burner, but the pilot is extinguished once the main burner is shut off, and that thermo-electric systems typically ignite the main burner directly and use heat from the main burner to activate the thermo-electric safety valve. (OGC, No. 8 at p. 3) HPBA commented that many outdoor gas fireplaces have open combustion chambers in which continuous pilot lights have a tendency to blow out. HPBA also commented that many prefabricated outdoor fireplaces have simple dial and push-button pilot light that is designed to be turned on and off manually to facilitate safe main burner ignition and pilot light controls that make it easy for consumers to avoid unnecessary pilot light use. (HPBA, No. 11 at pp. 45, 53) HPBA further stated that the potential for such continuous pilot lights to be left burning is unknown but likely to be limited. ( Id. at p. 45) HPBA commented that the pilot lights for these products are not designed to be left on indefinitely and would likely burn out if they were left burning for an extended period of time. HPBA stated that they are not aware of any pilot light operating hours data and added that this data serves no purpose for products that are not designed to be left with their pilot lights burning indefinitely. ( Id. at pp. 53-54)

AHRI commented generally that standing pilots are a practical and beneficial solution for units without an outside power source. (AHRI, No. 16 at p. 5) Similarly, HPBA commented that, for gas log sets, there are physical and mechanical challenges that limit the potential for electronic alternatives and the market for these products would likely be damaged by a continuous pilot ban. (HPBA, No. 11 at pp. 36-37)

HPBA stated that outdoor gas log sets are designed to be installed in the hearths of existing wood-burning fireplaces and face similar challenges as vented gas log sets in transitioning to electronic ignition, in that electronic ignition would negatively impact aesthetics and the added hardware would be difficult to conceal or shield from excessive heat. HPBA added that an increase in cost or decrease of appeal in outdoor gas log sets could cause consumers to leave conventional wood-burning fireplaces in operation, thereby causing adverse environmental impacts. ( Id. at p. 43) HPBA also commented that a ban on continuous pilot lights for these products could have adverse safety impacts because, for outdoor fire pits that use continuous pilots, the pilot provides a means to minimize the risk of delayed main burner ignition involving the sudden ignition of a significant amount of gas. ( Id. )

HPBA commented that when outside temperatures are low, the heat from a vented gas fireplace must initially overcome a column of cold air in the vent system. HPBA stated that this can present significant challenges with longer-vent installations and particularly with more heat-efficient designs that employ heat exchangers or flue restrictors to raise thermal efficiency and control excess air. HPBA stated that a cold-start-up can cause serious operational problems such as start-up lag, flame lift, burner outage, draft reversal, and delayed main burner ignition. HPBA added that any of these issues would be immediately observable by the consumer and can be quite alarming. HPBA stated that a pilot light warms the flue and establishes proper draw prior to main burner ignition to address all of the listed issues. HPBA commented that intermittent pilot ignition (“IPI”) systems with a continuous pilot ignition (“CPI”) function were created to address these concerns and that in some installations a continuous pilot flame is needed to ensure proper product operation. HPBA added that CPI functions are used to prevent or resolve operational problems. ( Id. at pp. 38-39) HPBA stated that the development of “on demand” systems has made it possible for CPI functions on IPI systems to be converted into “on demand” functions. ( Id. at p. 39) HPBA stated that DOE did not include “on demand” pilots which were developed to eliminate standing pilots in gas fireplace products. HPBA added that these on-demand ignition systems are currently one of the most common of the relevant ignition systems. ( Id. at pp. 24-25)

HPBA commented that gas fireplace products are different in every relevant aspect from products such as residential furnaces for which it was relatively easy to convert the pilot ignition. HPBA cited the following as major the differences: gas fireplaces are typically prominently displayed so that the glow of a pilot light is visible when the lights are out, gas fireplaces are generally “attended appliances” for which the main burners are used only through the conscious action of the consumer, gas fireplaces usually have user-friendly dial and push-button continuous pilot light controls, continuous pilot lights provide unique utility for gas fireplace consumers, and they have inherent characteristics that make the use of IPI technology particularly challenging. ( Id. at p. 35) HPBA stated that frequent user operation of pilot lights is not necessary and that the elimination of pilot lights would affect consumer utility. ( Id. at p. 36)

HPBA commented that the industry recognized that the elimination of continuous pilot lights could potentially result in energy savings and have invested considerable resources to develop alternatives. HPBA stated that these efforts have resulted in a dramatic trend away from the use of continuous pilots on vented gas fireplaces. ( Id. )

HPBA stated that the use of continuous pilot lights on vented gas fireplaces is already being phased out; therefore, HPBA commented that the imposition of regulatory burden to hasten market developments is unnecessary. ( Id. at p. 37) HPBA commented that DOE should consider why there hasn't already been widespread adoption of IPI technology (without CPI functionality) in the gas fireplace industry, why IPI systems with a CPI function and “on-demand” ignition systems were developed by the gas fireplace industry exclusively to provide an alternative to IPI-only systems for vented gas fireplaces, and why some retailers have reported that they choose to activate the CPI function on IPI products they sell. ( Id. at p. 37) HPBA stated that it is difficult to ensure that vented gas fireplaces with IPI-only ignition systems will not experience potentially significant operational problems in some installations. HPBA added that the specific technical issues that may occur are related to the differences between vented gas fireplaces and the types of products for which IPI systems were designed. ( Id. at pp. 37-38)

HPBA stated that gas fireplaces and log sets are so materially different from each other that combined data on the proportion of ignition system types for both products would be wildly inaccurate as applied to either. ( Id. at p. 19)

HPBA stated that they explored an initiative to eliminate continuous pilot lights on a wide range of outdoor gas products and determined that it would have little potential to conserve energy and would have undesirable collateral safety impacts. ( Id. at p. 45)

The CA IOUs stated that the California Energy Commission (“CEC”) determined that, using an assumption of 1,000 Btu/hour for gas burners and annual standing pilot operating hours of 4,612 hours per product, decorative hearth products and outdoor gas fireplaces will provide cost effective energy savings that will exceed the thresholds set by 42 U.S.C. 6292 (b)(1) and 42 U.S.C. 6295(l). The CA IOUs stated that using the CEC's assumptions, standing pilots used 4,161,569 Btu/year per unit which is equivalent to 1,219 kWh and exceeds the requirements to set standards under EPCA. (CA IOUs, No. 12 at p. 2) The CA IOUs stated that a CEC analysis determined that decorative hearth products with an on-demand pilot light used 1,747,755 Btu/year while decorative hearths with intermittent pilot energy used only 188,882 Btu/year. The CA IOUs also stated that the CEC determined that intermittent pilot light technologies are readily available. The CA IOUs stated the feasibility and savings that were demonstrated support that federal regulation of these products is consistent with the purposes of EPCA. ( Id. )

In response to concerns about potential standards that could eliminate the use of continuous pilot lights or regulate other ignition systems in the future, DOE notes that the current coverage rulemaking is only to determine whether coverage of MGPs is necessary or appropriate to carry out the purposes of EPCA, as discussed in section I.A. DOE maintains that patio heaters fall under the proposed definition of outdoor heaters and, by extension, MGPs, regardless of the type of ignition used in the product. DOE is not proposing standards for MGPs in this final determination of coverage. Comments regarding the benefits and obstacles for potential standards for MGPs will be considered in a separate energy conservation standards rulemaking. 16

In response to comments on the energy use estimates, DOE notes that it did not use the same operating characteristics for indoor decorative hearth pilot operation and outdoor heater pilot operation. DOE understands that a large percentage of outdoor heaters are propane, however, there are fixed outdoor heaters on the market. DOE adjusted the standing pilot hours and the percentage of standing pilots of decorative hearths to make an estimate of ignition energy use for outdoor heaters. In DOE's energy consumption estimate, it was assumed that only around 10 percent of outdoor heaters kept the pilot on when the main burner was not operating and the standing pilot hours were reduced to account for the fact that outdoor heaters are likely more seasonal than decorative hearths. In the February 2022 NOPD, DOE requested comment on the breakdown of ignition systems and standing pilot operating hours for outdoor heaters, and received no data. 87 FR 6786, 6792.

In response to the CA IOUs, DOE notes that the energy consumption analysis in the February 2022 NOPD was developed to determine if coverage of MGPs was warranted under 42 U.S.C. 6292(b). DOE will consider the technical feasibility, energy savings, and economic justification of various technologies in a standards rulemaking.

OGC and HHT stated that outdoor conditions vary greatly from season to season as well as by location and climate. (OGC, No. 8 at p. 3; HHT No. 9 at p. 3) OGC expressed concerns that DOE assumes outdoor decorative products are operated regardless of the outdoor ambient temperature without data to substantiate that assumption. (OGC, No. 8 at p. 3) Moroz stated that they are not aware of any data representing the operating hours of either outdoor heaters or decorative hearth appliances. (Moroz, No. 7 at p. 2) OGC added that they are unaware of available data on outdoor usage or energy consumption and that the operating characteristics for outdoor heaters, indoor decorative products, and outdoor decorative products are likely to be different. (OGC, No. 8 at p. 3)

NPGA stated in response to the February 2022 NOPD, that energy usage was estimated according to outdated survey information. NPGA also stated that decorative hearth products and outdoor heaters are intrinsically produced for different uses by consumers. NPGA commented that the data and surveys collected in past years were not administered according to the proposed product definition presented in the current notice and therefore, urged the DOE to issue an RFI for more data and present the data and proposed definitions for stakeholders in a new notice. (NPGA, No. 14 at pp. 2-3) NPGA commented that the DOE should pursue the most recent and up-to-date data on energy usage and manufacturing production because this information is crucial to determining if these products use enough energy to meet the threshold for regulation under EPCA. ( Id. at p. 2)

AHRI also stated that they do not view the prescription of decorate hearth usage data to outdoor heaters to be a valid assumption. AHRI further added that the consumer survey used to estimate decorative hearth usage may be questionable because all of the estimates were derived from a single survey. AHRI noted that the survey (although published in June of 2017) was conducted in February of 2016, there was no mechanism for respondents to confirm ownership of the equipment in question, and it was not confirmed that the respondents “subjective answers” reflected the manufacturers' design for decorative hearth equipment. (AHRI, No. 16 at pp. 3-4)

The Joint Commenters stated that it is not clear in the February 2022 NOPD whether match-lit units were included in the national energy use calculation. (The Joint Commenters, No. 13 at p. 2)

HPBA suggested that heating standards would be problematic because increasing heating efficiency and thus heat output can lead to more heat output than is desired. HPBA further suggested that even moderately high heating efficiency standards could substantially reduce the number of fireplaces appropriate to a given installation. Additionally, HPBA stated that an increase in heating efficiency cannot be expected to produce energy savings by reducing the burner operating hours required to satisfy heating needs. (HPBA, No. 11 at pp. 31-34)

DOE notes that the average operating hours for decorative hearths from the February 2022 NOPD was based on operating data for both indoor decorative hearths and outdoor decorative hearths from a 2017 survey by the Lawrence Berkeley National Laboratory (“2017 hearth survey”). 17 There was no assumption that outdoor decorative hearths operate the same regardless of outdoor air temperatures; the national average was creating by averaging the operating hours for decorative products (both indoor and outdoor) by region. DOE lacked data on the operation of outdoor heaters at the time of the February 2022 NOPD. The 2017 Hearth Survey provided estimates of main burner hours for decorative hearths and hearth heaters and noted a positive correlation between the main burner operating hours and utility for heat. DOE used the decorative hearth burner operating hours for outdoor heaters as those were the smallest amount of operating hours in the survey and therefore constitutes a conservative estimate. While DOE understands that the operating characteristics of decorative hearths and outdoor heaters may vary, given that large portions of the U.S. have long periods of cooler temperatures, it is unlikely that outdoor heaters would operate significantly less than what was assumed in the February 2022 NOPD. As DOE did not receive any data on the operating hours of decorative hearths or outdoor heaters, DOE did not change its estimates of national and household energy consumption.

DOE also notes that the 2017 Hearth Survey is the most comprehensive study of hearth products in the United States. While the respondent's answers were subjective, DOE has confidence in the survey because the percentage of products identified as decorative or mostly decorative (38 percent) is consistent with the percentage of total hearth shipments that were decorative (39 percent) from the February 2015 NOPR.

In response to the Joint Commenters, the main burner energy consumption of match-lit products was included in the national energy use calculation.

This coverage determination rulemaking is only to determine whether coverage of MGPs is necessary or appropriate to carry out the purposes of EPCA, as discussed in section I.A. DOE is not proposing standards for MGPs in this final determination of coverage. DOE may consider the impacts of standards on consumer utility in a future energy conservation standards rulemaking.

The Gas Associations commented that it is important that the DOE implement the recommendations from the recent National Academies of Sciences, Engineering, and Medicine (“NASEM”) report  18 into all of its appliance rulemakings. In particular, the Gas Associations recommended, based on the NASEM report, that DOE should pay greater attention to economic justification for the standards as required by EPCA and, to conclude that standards are economically justified, DOE should attempt to find significant failures of private markets or irrational behavior by consumers in the no-standards case. Additionally, the Gas Associations recommended that the DOE expand the Cost Analysis segment of the Engineering Analysis to include ranges of costs, patterns of consumption, diversity factors, energy peak demand, and variance regarding environmental factors. The Gas Associations also recommended that the DOE give greater weight to ex post and market-based evidence of markups in order to project more accurate effects of a standard on prices. (Gas Associations, No. 15 at p. 2)

The Gas Associations recommended that DOE provide an argument for the plausibility and magnitude of potential market failure related to the energy efficiency gap in its analysis. They added that there should be a presumption that the market actors behave rationally, unless DOE can provide evidence to the contrary. The Gas Associations also recommended that DOE should give greater attention to a broader set of potential market failures on the supply side. They stated that this should include how standards might reduce the number of competing firms and how they might impact price discrimination, technological diffusion, and collusion. ( Id. )

In response to the Gas Associations recommendations for the economic analysis, DOE notes that the current coverage rulemaking is only to determine whether coverage of MGPs is necessary or appropriate to carry out the purposes of EPCA. Economic considerations would be analyzed as part of an energy conservation standard rulemaking.

In response to the February 2022 NOPD, the CA IOUs agreed with DOE's tentative finding that the coverage of MGPs is necessary and appropriate to carry out the purposes of EPCA. (CA IOUs, No. 12 at p. 1) The Joint Commenters also indicated their support of DOE's determination that decorative hearths and outdoor heaters qualify as MGPs covered under EPCA. However, the Joint Commenters encouraged DOE to not finalize the proposed determination until energy conservation standards have been finalized, since information that is learned during the rulemaking process for both test procedures and energy conservation standards can ultimately inform the coverage determination. (Joint Commenters, No. 13 at p. 1)

HPBA and APGA requested that DOE further explain its proposal with specific regard to the identification of the specific product for which coverage is proposed, and why (and how) DOE believes that it would be appropriate to regulate each of those products. (HPBA, No. 2 at pp. 1-2; APGA, No. 5 at pp. 1-2)

HPBA and AGA requested that DOE hold a public meeting to clarify its current proposal. (HPBA, No. 2 at p. 1; AGA, No. 4 at p 2) HPBA requested the opportunity to present specific recommendations concerning DOE's basic regulatory approach to facilitate a constructive exchange of information and ideas. (HPBA, No. 2 at pp. 2-3) Additionally, HPBA included in their comments a resubmission of the comments they submitted on May 11, 2015, in response to the February 2015 NOPR as evidence to support their claim of inadequate informational exchange. ( Id. at p. 10) HPBA also added that DOE is behind on statutory deadlines for regulatory actions on numerous products that it has a mandatory duty to complete and therefore it is not “necessary” or “appropriate” for DOE to regulate MGPs. ( Id. at p. 54) AGA commented that the rulemaking history in this proposal and the unaddressed concerns of stakeholders makes a public meeting appropriate. AGA added that the meeting should address concerns including outstanding coverage determinations, whether there is a justifiable basis for regulating covered products, and how covered products may be regulated. (AGA, No. 4 at pp. 1-2)

In response, DOE notes that although the scope of the February 2015 NOPR differed from the current coverage determination, many insights from that rulemaking (for example, information about technology options that are also relevant to MGPs) informed the current coverage determination. Additionally, DOE responds that stakeholders were given the opportunity to provide written comments in response to the proposed coverage determination, which DOE determines to be a sufficient opportunity to provide feedback. Moreover, as noted above, this rulemaking only establishes coverage for MGPs. DOE's authority and responsibility to determine the coverage of MGPs is distinct from its authority under EPCA. Prior to the adoption of any energy conservation standards or test procedures for these products, stakeholders will have additional opportunities for comment, including a public meeting(s).

The Gas Associations commented that the proposed coverage determination of MGPs is neither necessary nor appropriate within the meaning of 42 U.S.C. 6292(b)(1)(A). They added that DOE has not provided sufficient evidence to demonstrate economic justification or significant energy savings for an efficiency standard for MGPs. (Gas Associations, No. 15 at pp 2-3) They stated that the February 2022 NOPD treated broad categories of different products as though they are a single product and recommended the withdrawal of the proposed coverage determination for reconsideration. ( Id. at p. 3) OGC commented that the coverage of “miscellaneous gas products” is not necessary or appropriate to carry out the purposes of EPCA and that it is too broad to justify coverage under EPCA. (OGC, No. 8 at p. 3) OGC and HHT further commented that the information and analysis in the February 2022 NOPD are inadequate to support the issuance of a determination for MGPs. Consequently, OGC recommended that the proposed determination be withdrawn and treated as an RFI to allow for more collaboration with industry to properly determine what is considered a covered product. (OGC, No. 8 at p. 1; HHT, No. 9 at pp. 1, 3)

Similarly, HPBA requested that the DOE withdraw the February 2022 NOPD and discontinue any further regulatory efforts with respect to gas fireplaces, fireplace inserts, freestanding stoves, gas log sets, outdoor gas products designed to have visual appeal (fire pits, fire tables, tiki torches, patio heaters that double as outdoor lighting or flame art, and pure objects of flame art), and strictly utilitarian portable patio heaters. HPBA added that coverage for the listed products is neither “necessary” nor “appropriate” within the meaning of 42 U.S.C. 6292(b)(1)(A) and was not proven otherwise by the February 2022 NOPD. HPBA stated that there is no potential for energy savings or economic justification that could be provided by efficiency standards for these products and that these products are unsuitable targets for efficiency regulation. (HPBA, No. 11 at p. 1) HPBA commented that the DOE's attempt to establish coverage of MGPs is not supported by EPCA and stated that the February 2022 NOPD did not provide a reasonable basis to conclude that MGPs are worth regulating. ( Id. at pp. 13-15) HPBA stated that DOE should follow the direction of Executive Order 13563 and ensure that it has incorporated information and perspectives from those who are likely to be affected by the proposal. ( Id. at p. 12) HPBA stated that coverage determinations must be product-specific and that to establish that coverage is warranted, DOE must demonstrate that the product is not a “gnat” and explain why regulation of that product is “necessary” or “appropriate” to carry out EPCA's purposes. HPBA also stated that there is insufficient data and information used for the analysis. They added that data collection should be the first step in the development of a rule. HPBA stated that the pace of technological and market changes has made it so information concerning the prevalence of continuous pilot lights becomes quickly outdated. HPBA commented that while they have not had sufficient opportunity to review the basis of the DOE's claims, they stated that the February 2022 NOPD is based on inaccurate information, inadequate data, and arbitrary assumptions. ( Id. at pp. 24-25)

DOE notes that Part A of Title III of EPCA, 42 U.S.C. 6291 et seq., authorizes DOE to classify additional types of consumer products as covered products upon determining that: (1) classifying the product as a covered product is necessary or appropriate for the purposes of EPCA; and (2) the average annual per-household energy use by products of such type is likely to exceed 100 kilowatt-hours per year (kWh/yr). (42 U.S.C. 6292(b)(1)). DOE's evaluation of MGPs under this standard is discussed in section II.C of this determination.

DOE evaluated whether MGPs, which are comprised of decorative hearth products and outdoor heaters, are “consumer products” under EPCA. As discussed in section I of this document, a consumer product is any article (other than an automobile) of a type—(A) which in operation consumes, or is designed to consume energy; and (B) which, to any significant extent, is distributed in commerce for personal use or consumption by individuals; without regard to whether such article of such type is in fact distributed in commerce for personal use or consumption by an individual. (42 U.S.C. 6291(a)(1)) MGPs consume energy during operation and are distributed in commerce for personal use by individuals. Therefore, DOE has determined that MGPs are consumer products within the scope of EPCA.

The following sections describe DOE's evaluation of whether MGPs fulfill the criteria for being added as covered products pursuant to 42 U.S.C. 6292(b)(1). As stated previously, DOE may classify a consumer product as a covered product if:

(1) Classifying products of such type as covered products is necessary or appropriate to carry out the purposes of EPCA; and

(2) The average annual per-household energy use by products of such type is likely to exceed 100 kWh (or its Btu equivalent) per year.

DOE has determined that coverage of MGPs is necessary or appropriate to carry out the purposes of EPCA, which include:

To conserve energy supplies through energy conservation programs, and, where necessary, the regulation of certain energy uses; and

To provide for improved energy efficiency of motor vehicles, major appliances, and certain other consumer products. (42 U.S.C. 6291(4)-(5))

DOE estimates that annual shipments of MGPs have averaged approximately 190,000 units per year from 2016 to 2020. 19 DOE estimates that the aggregate national energy use of decorative hearth products is 0.0135 quadrillion British thermal units (“quads”) (4.0 Terawatt-hours (“TWh”)), 20 and that the aggregate national energy use of outdoor heaters is estimated to be 0.0007 quads (0.2 TWh). 21 DOE estimates that the aggregate national energy use of decorative hearth products and outdoor heaters, comprising MGPs, is 0.0143 quads (4.2 TWh). Coverage of MGPs would result in the conservation of energy supplies through the regulation of energy efficiency. Therefore, DOE has determined that coverage of MGPs is necessary and appropriate to carrying out the purposes of EPCA, thereby satisfying the provisions of 42 U.S.C. 6292(b)(1)(A).

DOE estimates that decorative hearths account for 93 percent of the MGP market and that outdoor heaters account for 7 percent. DOE calculated the weighted average per-household energy use of an MGP to be 4.1 MMbtu/yr (1,211 kWh/yr). 22 Therefore, DOE estimates that the average annual per-household energy use for MGPs is likely to exceed 100 kWh/yr, thereby satisfying the provisions of 42 U.S.C. 6292(b)(1)(B).

Based on the foregoing discussion, DOE concludes that including MGPs, as defined in this final determination, as covered products is necessary and appropriate to carry out the purposes of EPCA, and the average annual per-household energy use by products of such type is likely to exceed 100 kWh/yr. Based on the information discussed in section II of this final determination, DOE is classifying MGPs as a covered product. This final determination does not establish test procedures or energy conservation standards for MGPs. DOE will address test procedures and energy conservation standards through its normal rulemaking process.

Executive Order (“E.O.”) 12866, “Regulatory Planning and Review,” as supplemented and reaffirmed by E.O. 13563, “Improving Regulation and Regulatory Review,” 76 FR 3821 (Jan. 21, 2011), requires agencies, to the extent permitted by law, to (1) propose or adopt a regulation only upon a reasoned determination that its benefits justify its costs (recognizing that some benefits and costs are difficult to quantify); (2) tailor regulations to impose the least burden on society, consistent with obtaining regulatory objectives, taking into account, among other things, and to the extent practicable, the costs of cumulative regulations; (3) select, in choosing among alternative regulatory approaches, those approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity); (4) to the extent feasible, specify performance objectives, rather than specifying the behavior or manner of compliance that regulated entities must adopt; and (5) identify and assess available alternatives to direct regulation, including providing economic incentives to encourage the desired behavior, such as user fees or marketable permits, or providing information upon which choices can be made by the public. DOE emphasizes as well that E.O. 13563 requires agencies to use the best available techniques to quantify anticipated present and future benefits and costs as accurately as possible. In its guidance, the Office of Information and Regulatory Affairs (“OIRA”) in the Office of Management and Budget (“OMB”) has emphasized that such techniques may include identifying changing future compliance costs that might result from technological innovation or anticipated behavioral changes. For the reasons stated in the preamble, this final regulatory action is consistent with these principles.

Section 6(a) of E.O. 12866 also requires agencies to submit “significant regulatory actions” to OIRA for review. OIRA has determined that this final regulatory action does not constitute a “significant regulatory action” under section 3(f) of E.O. 12866. Accordingly, this action was not submitted to OIRA for review under E.O. 12866.

The Regulatory Flexibility Act (5 U.S.C. 601 et seq. ) requires preparation of an initial regulatory flexibility analysis (“IRFA”) and a final regulatory flexibility analysis (“FRFA”) for any rule that by law must be proposed for public comment, unless the agency certifies that the rule, if promulgated, will not have a significant economic impact on a substantial number of small entities. As required by E.O. 13272, “Proper Consideration of Small Entities in Agency Rulemaking,” 67 FR 53461 (Aug. 16, 2002), DOE published procedures and policies on February 19, 2003, to ensure that the potential impacts of its rules on small entities are properly considered during the rulemaking process. 68 FR 7990. DOE has made its procedures and policies available on the Office of the General Counsel's website ( www.energy.gov/gc/office-general-counsel ).

DOE reviewed this final determination under the provisions of the Regulatory Flexibility Act and the policies and procedures published on February 19, 2003. This final determination does not establish test procedures or standards for MGPs. On the basis of the foregoing, DOE certifies that this final determination has no significant economic impact on a substantial number of small entities.

This final determination, which concludes that MGPs meet the criteria for a covered product for which the Secretary may consider prescribing energy conservation standards pursuant to 42 U.S.C. 6295(o) and (p), imposes no new information or record-keeping requirements. Accordingly, the OMB clearance is not required under the Paperwork Reduction Act. (44 U.S.C. 3501 et seq. )

Pursuant to the National Environmental Policy Act of 1969 (“NEPA”), DOE has analyzed this final determination in accordance with NEPA and DOE's NEPA implementing regulations (10 CFR part 1021). DOE has determined that this final determination qualifies for categorical exclusion under 10 CFR part 1021, subpart D, appendix A6, because it is strictly procedural and meets the requirements for application of a categorial exclusion. 10 CFR 1021.410. Therefore, DOE has determined that promulgation of this final determination is not a major Federal action significantly affecting the quality of the human environment within the meaning of NEPA, and does not require an Environmental Assessment or an Environmental Impact Statement.

E.O. 13132, “Federalism,” 64 FR 43255 (Aug. 10, 1999), imposes certain requirements on Federal agencies formulating and implementing policies or regulations that preempt State law or that have federalism implications. The Executive order requires agencies to examine the constitutional and statutory authority supporting any action that would limit the policymaking discretion of the States and to carefully assess the necessity for such actions. The Executive order also requires agencies to have an accountable process to ensure meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications. On March 14, 2000, DOE published a statement of policy describing the intergovernmental consultation process it will follow in the development of such regulations. 65 FR 13735. This final determination does not establish energy conservation standards for MGPs. DOE has examined this final determination and concludes that it does not preempt State law or have substantial direct effect on the States, on the relationship between the Federal Government and the States, or on the distribution of power and responsibilities among the various levels of government. EPCA governs and prescribes Federal preemption of State regulations as to energy conservation for the products that are the subject of this final rule. Therefore, no further action is required by Executive Order 13132.

With respect to the review of existing regulations and the promulgation of new regulations, section 3(a) of E.O. 12988, “Civil Justice Reform,” imposes on Federal agencies the general duty to adhere to the following requirements: (1) eliminate drafting errors and ambiguity, (2) write regulations to minimize litigation, (3) provide a clear legal standard for affected conduct rather than a general standard, and (4) promote simplification and burden reduction. 61 FR 4729 (Feb. 7, 1996). Regarding the review required by section 3(a), section 3(b) of E.O. 12988 specifically requires that Executive agencies make every reasonable effort to ensure that the regulation (1) clearly specifies the preemptive effect, if any, (2) clearly specifies any effect on existing Federal law or regulation, (3) provides a clear legal standard for affected conduct while promoting simplification and burden reduction, (4) specifies the retroactive effect, if any, (5) adequately defines key terms, and (6) addresses other important issues affecting clarity and general draftsmanship under any guidelines issued by the Attorney General. Section 3(c) of E.O. 12988 requires Executive agencies to review regulations in light of applicable standards in section 3(a) and section 3(b) to determine whether they are met or it is unreasonable to meet one or more of them. DOE has completed the required review and determined that, to the extent permitted by law, this final determination meets the relevant standards of E.O. 12988.

Title II of the Unfunded Mandates Reform Act of 1995 (“UMRA”) requires each Federal agency to assess the effects of Federal regulatory actions on State, local, and Tribal governments and the private sector. Public Law 104-4, sec. 201 (codified at 2 U.S.C. 1531). For a regulatory action likely to result in a rule that may cause the expenditure by State, local, and Tribal governments, in the aggregate, or by the private sector of $100 million or more in any one year (adjusted annually for inflation), section 202 of UMRA requires a Federal agency to publish a written statement that estimates the resulting costs, benefits, and other effects on the national economy. (2 U.S.C. 1532(a), (b)) The UMRA also requires a Federal agency to develop an effective process to permit timely input by elected officers of State, local, and Tribal governments on a “significant intergovernmental mandate,” and requires an agency plan for giving notice and opportunity for timely input to potentially affected small governments before establishing any requirements that might significantly or uniquely affect them. On March 18, 1997, DOE published a statement of policy on its process for intergovernmental consultation under UMRA. 62 FR 12820. DOE's policy statement is also available at www.energy.gov/sites/prod/files/gcprod/documents/umra_97.pdf.

DOE examined this final determination according to UMRA and its statement of policy and determined that the determination does not contain a Federal intergovernmental mandate, nor is it expected to require expenditures of $100 million or more in any one year by State, local, and Tribal governments, in the aggregate, or by the private sector. As a result, the analytical requirements of UMRA do not apply.

Section 654 of the Treasury and General Government Appropriations Act, 1999 (Pub. L. 105-277) requires Federal agencies to issue a Family Policymaking Assessment for any rule that may affect family well-being. This final determination would not have any impact on the autonomy or integrity of the family as an institution. Accordingly, DOE has concluded that it is not necessary to prepare a Family Policymaking Assessment.

Pursuant to E.O. 12630, “Governmental Actions and Interference with Constitutionally Protected Property Rights,” 53 FR 8859 (March 18, 1988), DOE has determined that this final determination would not result in any takings that might require compensation under the Fifth Amendment to the U.S. Constitution.

Section 515 of the Treasury and General Government Appropriations Act, 2001 (44 U.S.C. 3516, note) provides for Federal agencies to review most disseminations of information to the public under information quality guidelines established by each agency pursuant to general guidelines issued by OMB. OMB's guidelines were published at 67 FR 8452 (Feb. 22, 2002), and DOE's guidelines were published at 67 FR 62446 (Oct. 7, 2002). Pursuant to OMB Memorandum M-19-15, Improving Implementation of the Information Quality Act (April 24, 2019), DOE published updated guidelines which are available at: www.energy.gov/sites/prod/files/2019/12/f70/DOE%20Final%20Updated%20IQA%20Guidelines%20Dec%202019.pdf. DOE has reviewed this final determination under the OMB and DOE guidelines and has concluded that it is consistent with applicable policies in those guidelines.

E.O. 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use,” 66 FR 28355 (May 22, 2001), requires Federal agencies to prepare and submit to OIRA at OMB, a Statement of Energy Effects for any significant energy action. A “significant energy action” is defined as any action by an agency that promulgates or is expected to lead to promulgation of a final rule, and that (1) is a significant regulatory action under Executive Order 12866, or any successor order; and (2) is likely to have a significant adverse effect on the supply, distribution, or use of energy, or (3) is designated by the Administrator of OIRA as a significant energy action. For any significant energy action, the agency must give a detailed statement of any adverse effects on energy supply, distribution, or use should the proposal be implemented, and of reasonable alternatives to the action and their expected benefits on energy supply, distribution, and use.

This final determination, which does not amend or establish energy conservation standards for MGPs, is not a significant regulatory action under E.O. 12866. Moreover, it would not have a significant adverse effect on the supply, distribution, or use of energy, nor has it been designated as such by the Administrator at OIRA. Accordingly, DOE has not prepared a Statement of Energy Effects.

On December 16, 2004, OMB, in consultation with the Office of Science and Technology Policy (“OSTP”), issued its Final Information Quality Bulletin for Peer Review (“the Bulletin”). 70 FR 2664 (Jan. 14, 2005). The Bulletin establishes that certain scientific information shall be peer reviewed by qualified specialists before it is disseminated by the Federal Government, including influential scientific information related to agency regulatory actions. The purpose of the Bulletin is to enhance the quality and credibility of the Government's scientific information. Under the Bulletin, the energy conservation standards rulemaking analyses are “influential scientific information,” which the Bulletin defines as “scientific information the agency reasonably can determine will have, or does have, a clear and substantial impact on important public policies or private sector decisions.” 70 FR 2664, 2667.

In response to OMB's Bulletin, DOE conducted formal peer reviews of the energy conservation standards development process and the analyses that are typically used and prepared a report describing that peer review. 23 Generation of this report involved a rigorous, formal, and documented evaluation using objective criteria and qualified and independent reviewers to make a judgment as to the technical/scientific/business merit, the actual or anticipated results, and the productivity and management effectiveness of programs and/or projects. Because available data, models, and technological understanding have changed since 2007, DOE has engaged with the National Academy of Sciences to review DOE's analytical methodologies to ascertain whether modifications are needed to improve the Department's analyses. DOE is in the process of evaluating the resulting report. 24

As required by 5 U.S.C. 801, DOE will report to Congress on the promulgation of this final determination prior to its effective date. The report will state that it has been determined that the final determination is not a “major rule” as defined by 5 U.S.C. 804(2).

The Secretary of Energy has approved publication of this final determination.

This document of the Department of Energy was signed on August 26, 2022, by, Dr. Geraldine L. Richmond, Under Secretary for Science and Innovation, pursuant to delegated authority from the Secretary of Energy. That document with the original signature and date is maintained by DOE. For administrative purposes only, and in compliance with requirements of the Office of the Federal Register, the undersigned DOE Federal Register Liaison Officer has been authorized to sign and submit the document in electronic format for publication, as an official document of the Department of Energy. This administrative process in no way alters the legal effect of this document upon publication in the Federal Register .

For the reasons set forth in the preamble, DOE amends part 430 of chapter II, subchapter D, of title 10 of the Code of Federal Regulations, to read as set forth below:

Can entities violate the prohibition on unfair acts or practices in the Consumer Financial Protection Act (CFPA) when they have insufficient data protection or information security?

Yes. In addition to other Federal laws governing data security for financial institutions, including the Safeguards Rules issued under the Gramm-Leach-Bliley Act (GLBA), “covered persons” and “service providers” must comply with the prohibition on unfair acts or practices in the CFPA. Inadequate security for the sensitive consumer information collected, processed, maintained, or stored by the company can constitute an unfair practice in violation of 12 U.S.C. 5536(a)(1)(B). While these requirements often overlap, they are not coextensive.

Acts or practices are unfair when they cause or are likely to cause substantial injury that is not reasonably avoidable or outweighed by countervailing benefits to consumers or competition. Inadequate authentication, password management, or software update policies or practices are likely to cause substantial injury to consumers that is not reasonably avoidable by consumers, and financial institutions are unlikely to successfully justify weak data security practices based on countervailing benefits to consumers or competition. Inadequate data security can be an unfair practice in the absence of a breach or intrusion.

Widespread data breaches and cyberattacks have resulted in significant harms to consumers, including monetary loss, identity theft, significant time and money spent dealing with the impacts of the breach, and other forms of financial distress. Providers of consumer financial services are subject to specific requirements to protect consumer data. In 2021, the Federal Trade Commission (FTC) updated its Safeguards Rule implementing section 501(b) of GLBA, to set forth specific criteria relating to the safeguards that certain nonbank financial institutions must implement as a part of their information security programs. 1 These safeguards, among other things, limit who can access customer information, require the use of encryption to secure such information, and require the designation of a single qualified individual to oversee an institution's information security program and report at least annually to the institution's board of directors or equivalent governing body. The Federal banking agencies also have issued interagency guidelines to implement section 501 of GLBA. 2

In certain circumstances, failure to comply with these specific requirements may also violate the CFPA's prohibition on unfair acts or practices. The CFPA defines an unfair act or practice as an act or practice: (1) that causes or is likely to cause substantial injury to consumers, (2) which is not reasonably avoidable by consumers, and (3) is not outweighed by countervailing benefits to consumers or competition. 3

A practice causes substantial injury to consumers when it causes significant harm to a few consumers or a small amount of harm to many consumers. For example, inadequate data security measures can cause significant harm to a few consumers who become victims of targeted identity theft as a result, or it can cause harm to potentially millions of consumers when there are large customer-base-wide data breaches. Information security weaknesses can result in data breaches, cyberattacks, exploits, ransomware attacks, and other exposure of consumer data. 4

Further, actual injury is not required to satisfy this prong in every case. A significant risk of harm is also sufficient. In other words, this prong of unfairness is met even in the absence of a data breach. Practices that “are likely to cause” substantial injury, including inadequate data security measures that have not yet resulted in a breach, nonetheless satisfy this prong of unfairness. 5

The substance of these special conditions has been published in the Federal Register for public comment in several prior instances with no substantive comments received. Therefore, the FAA finds, pursuant to 14 CFR 11.38(b), that new comments are unlikely, and notice and comment prior to this publication are unnecessary.

The FAA invites interested people to take part in this rulemaking by sending written comments, data, or views. The most helpful comments reference a specific portion of the special conditions, explain the reason for any recommended change, and include supporting data.

The FAA will consider all comments received by the closing date for comments. The FAA may change these special conditions based on the comments received.

On October 1, 2021, L2 Consulting Services, Inc., applied for a supplemental type certificate for the installation of an electronic network system architecture that will allow increased connectivity to and access from external network sources, ( e.g., operator networks, wireless devices, internet connectivity, service provider satellite communications, electronic flight bags, etc.) to the airplane's previously isolated electronic assets (networks, systems, and databases). The Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes are twin-engine, transport category airplanes, executive-interior business jets with a maximum takeoff weight of 93,500 pounds (42,410 Kg) and a maximum seating capacity of seventeen passengers and two crew members.

Under the provisions of title 14, Code of Federal Regulations (14 CFR) 21.101, L2 Consulting Services Inc., must show that the Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes, as changed, continue to meet the applicable provisions of the regulations listed in Type Certificate No. T00003NY, or the applicable regulations in effect on the date of application for the change, except for earlier amendments as agreed upon by the FAA.

If the Administrator finds that the applicable airworthiness regulations ( e.g., 14 CFR part 25) do not contain adequate or appropriate safety standards for the Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes, because of a novel or unusual design feature, special conditions are prescribed under the provisions of § 21.16.

Special conditions are initially applicable to the model for which they are issued. Should the applicant apply for a supplemental type certificate to modify any other model included on the same type certificate to incorporate the same novel or unusual design feature, these special conditions would also apply to the other model under § 21.101.

In addition to the applicable airworthiness regulations and special conditions, the Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes must comply with the fuel-vent and exhaust-emission requirements of 14 CFR part 34, and the noise-certification requirements of 14 CFR part 36.

The FAA issues special conditions, as defined in 14 CFR 11.19, in accordance with § 11.38, and they become part of the type certification basis under § 21.101.

The Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes will incorporate a novel or unusual design feature, which is the installation of an electronic network system architecture that will allow increased connectivity to and access from external network sources, ( e.g., operator networks, wireless devices, internet connectivity, service provider satellite communications, electronic flight bags, etc.) to the airplane's previously isolated electronic assets (networks, systems, and databases).

The Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes electronic system architecture and network configuration is novel or unusual for commercial transport airplanes because it may allow increased connectivity to and access from aircraft external network sources, airline operations, and maintenance networks, to the airplane's control domain and airline information services domain. The airplane's control domain and airline information services domain perform functions required for the safe operation and maintenance of the airplane. Previously, these domains had very limited connectivity with external network sources. This data network and design integration creates a potential for unauthorized persons to access the aircraft control domain and airline information services domain, and presents security vulnerabilities related to the introduction of computer viruses and worms, user errors, and intentional sabotage of airplane electronic assets (networks, systems, and databases) critical to the safety and maintenance of the airplane.

The existing FAA regulations did not anticipate these networked airplane-system architectures. Furthermore, these regulations and the current guidance material do not address potential security vulnerabilities, which could be exploited by unauthorized access to airplane networks, databuses, and servers. Therefore, these special conditions ensure that the security ( i.e., confidentiality, integrity, and availability) of airplane systems is not compromised by unauthorized wired or wireless electronic connections. This includes ensuring that the security of the airplane's systems is not compromised during maintenance of the airplane's electronic systems. These special conditions also require the applicant to provide appropriate instructions to the operator to maintain all electronic-system safeguards that have been implemented as part of the original network design so that this feature does not allow or introduce security threats.

These special conditions contain the additional safety standards that the Administrator considers necessary to establish a level of safety equivalent to that established by the existing airworthiness standards.

As discussed above, these special conditions are applicable to the Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes. Should L2 Consulting Services, Inc., apply at a later date for a supplemental type certificate to modify any other model included on Type Certificate No. T00003NY to incorporate the same novel or unusual design feature, these special conditions would apply to that model as well.

This action affects only a certain novel or unusual design feature on Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes. It is not a rule of general applicability and affects only the applicant who applied to the FAA for approval of this feature on the airplane.

The authority citation for these special conditions is as follows:

1. The applicant must ensure airplane electronic system security protection from access by unauthorized sources external to the airplane, including those possibly caused by maintenance activity.

2. The applicant must ensure that electronic system security threats are identified and assessed, and that effective electronic system security protection strategies are implemented to protect the airplane from all adverse impacts on safety, functionality, and continued airworthiness.

3. The applicant must establish appropriate procedures to allow the operator to ensure that continued airworthiness of the airplane is maintained, including all post type certification modifications that may have an impact on the approved electronic system security safeguards.

The substance of these special conditions has been published in the Federal Register for public comment in several prior instances with no substantive comments received. Therefore, the FAA finds, pursuant to 14 CFR 11.38(b), that new comments are unlikely, and notice and comment prior to this publication are unnecessary.

The FAA invites interested people to take part in this rulemaking by sending written comments, data, or views. The most helpful comments reference a specific portion of the special conditions, explain the reason for any recommended change, and include supporting data.

The FAA will consider all comments received by the closing date for comments. The FAA may change these special conditions based on the comments received.

On October 1, 2021, L2 Consulting Services, Inc., applied for a supplemental type certificate for the installation of a digital system that contains a wireless and hardwired network with hosted application functionality that allows access, from sources internal to the airplane, to the airplane's internal electronic components. The Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes are twin-engine business jets with a maximum takeoff weight of 93,500 pounds (42,410 Kg) and a maximum seating capacity of seventeen passengers and two crew members.

Under the provisions of title 14, Code of Federal Regulations (14 CFR) 21.101, L2 Consulting Services Inc., must show that the Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes, as changed, continue to meet the applicable provisions of the regulations listed in Type Certificate No. T00003NY, or the applicable regulations in effect on the date of application for the change, except for earlier amendments as agreed upon by the FAA.

If the Administrator finds that the applicable airworthiness regulations ( e.g., 14CFR part25) do not contain adequate or appropriate safety standards for the Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes, because of a novel or unusual design feature, special conditions are prescribed under the provisions of § 21.16.

Special conditions are initially applicable to the model for which they are issued. Should the applicant apply for a supplemental type certificate to modify any other model included on the same type certificate to incorporate the same novel or unusual design feature, these special conditions would also apply to the other model under § 21.101.

In addition to the applicable airworthiness regulations and special conditions, the Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes must comply with the fuel-vent and exhaust-emission requirements of 14 CFR part 34, and the noise-certification requirements of 14 CFR part 36.

The FAA issues special conditions, as defined in 14 CFR 11.19, in accordance with § 11.38, and they become part of the type certification basis under § 21.101.

The Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes will incorporate the following novel or unusual design feature, which is the installation of a digital system that contains a wireless and hardwired network with hosted application functionality that allows access, from sources internal to the airplane, to the airplane's internal electronic components.

The Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes electronic system architecture and network configuration change is novel or unusual for commercial transport airplanes because it is composed of several connected wireless and hardwired networks. This proposed system and network architecture is used for a diverse set of airplane functions, including:

• flight-safety related control and navigation systems,

• airline business and administrative support, and

• passenger entertainment.

The airplane's control domain and airline information services domain of these networks perform functions required for the safe operation and maintenance of the airplane. Previously, these domains had very limited connectivity with other network sources. This network architecture creates a potential for unauthorized persons to access the aircraft control domain and airline information services domain from sources internal to the airplane, and presents security vulnerabilities related to the introduction of computer viruses and worms, user errors, and intentional sabotage of airplane electronic assets (networks, systems, and databases) critical to the safety and maintenance of the airplane.

The existing FAA regulations did not anticipate these networked airplane-system architectures. Furthermore, these regulations and the current guidance material do not address potential security vulnerabilities, which could be exploited by unauthorized access to airplane networks, data buses, and servers. Therefore, these special conditions ensure that the security ( i.e., confidentiality, integrity, and availability) of airplane systems will not be compromised by unauthorized hardwired or wireless electronic connections from within the airplane. These special conditions also require the applicant to provide appropriate instructions to the operator to maintain all electronic-system safeguards that have been implemented as part of the original network design so that this feature does not allow or reintroduce security threats.

These special conditions contain the additional safety standards that the Administrator considers necessary to establish a level of safety equivalent to that established by the existing airworthiness standards.

As discussed above, these special conditions are applicable to the Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes. Should L2 Consulting Services, Inc., apply at a later date for a supplemental type certificate to modify any other model included on Type Certificate No. T00003NY to incorporate the same novel or unusual design feature, these special conditions would apply to that model as well.

This action affects only a certain novel or unusual design feature on Bombardier Model BD-700-1A10 and BD-700-1A11 airplanes. It is not a rule of general applicability and affects only the applicant who applied to the FAA for approval of this feature on the airplane.

The authority citation for these special conditions is as follows:

1. The applicant must ensure that the design provides isolation from, or airplane electronic-system security protection against, access by unauthorized sources internal to the airplane. The design must prevent inadvertent and malicious changes to, and all adverse impacts upon, airplane equipment, systems, networks, and other assets required for safe flight and operations.

2. The applicant must establish appropriate procedures to allow the operator to ensure that continued airworthiness of the airplane is maintained, including all post-type-certification modifications that may have an impact on the approved electronic-system security safeguards.

The FAA issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 by adding an AD that would apply to certain MHI RJ Aviation ULC Model CL-600-2D24 (Regional Jet Series 900) airplanes. The NPRM published in the Federal Register on June 2, 2022 (87 FR 33454). The NPRM was prompted by AD CF-2021-31, dated September 14, 2021, issued by Transport Canada Civil Aviation (TCCA), which is the aviation authority for Canada (referred to after this as the MCAI). The MCAI states that a manufacturing error may have resulted in dents on the lower wing plank, close to the five flap arm locations at wing station (WS) 54.55, WS 128.00, WS 179.00, WS 220.00, and WS 264.00. These dents could lead to cracks that could weaken the structural integrity of the wings before being detected by any existing required inspection.

In the NPRM, the FAA proposed to require an inspection for damage (including dents, cracks, discoloration, gouges, scratches, or other surface damage) of the lower wing plank in the flap arm areas at certain wing stations, and repair if necessary. The FAA is issuing this AD to address the unsafe condition on these products.

You may examine the MCAI in the AD docket at regulations.gov under Docket No. FAA-2022-0592.

The FAA received no comments on the NPRM or on the determination of the cost to the public.

This product has been approved by the aviation authority of another country and is approved for operation in the United States. Pursuant to the FAA's bilateral agreement with this State of Design Authority, it has notified the FAA of the unsafe condition described in the MCAI referenced above. The FAA reviewed the relevant data and determined that air safety requires adopting this AD as proposed. Accordingly, the FAA is issuing this AD to address the unsafe condition on this product. Except for minor editorial changes, this AD is adopted as proposed in the NPRM. None of the changes will increase the economic burden on any operator.

The FAA reviewed MHI RJ Aviation Service Bulletin 670BA-57-029, dated February 2, 2021. This service information specifies procedures for, among other actions, doing a detailed visual inspection for damage (including dents, cracks, discoloration, gouges, scratches, or other surface damage) of the outer aft lower skin at WS 54.55, WS 128.00, WS 179.00, WS 220.00, and WS 264.00, and repair. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

The FAA estimates that this AD affects 14 airplanes of U.S. registry. The FAA estimates the following costs to comply with this AD:

EASA, which is the Technical Agent for the Member States of the European Union, has issued EASA AD 2021-0246, dated November 17, 2021 (EASA AD 2021-0246) (also referred to as the MCAI), to correct an unsafe condition for all Airbus SAS Model A330-201, -202, -203, -223, and -243 airplanes; Model A330-223F and -243F airplanes; Model A330-301, -302, -303, -321, -322, -323, -341, -342, and -343 airplanes; Model A330-841 airplanes; and Model A330-941 airplanes.

The FAA issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 to supersede AD 2017-10-24, Amendment 39-18898 (82 FR 24035, May 25, 2017) (AD 2017-10-24); AD 2018-23-14, Amendment 39-19501 (83 FR 60754, November 27, 2018) (AD 2018-23-14); and AD 2021-05-12, Amendment 39-21455 (86 FR 15092, March 22, 2021) (AD 2021-05-12). AD 2017-10-24 applied to certain Airbus SAS Model A330-200 series airplanes, Model A330-200 Freighter series airplanes, and Model A330-300 series airplanes; AD 2018-23-14 applied to certain Airbus SAS Model A330-200 series airplanes, Model A330-200 Freighter series airplanes, and Model A330-300 series airplanes; and AD 2021-05-12 applied to certain Airbus SAS Model A330-200 Freighter series airplanes. The NPRM published in the Federal Register on June 9, 2022 (87 FR 35118). The NPRM was prompted by a determination that new or more restrictive airworthiness limitations are necessary. The NPRM proposed to revise the applicability by adding airplanes. The NPRM also proposed to continue to require the actions in AD 2018-23-14 and AD 2021-05-12, and proposed to require revising the existing maintenance or inspection program, as applicable, to incorporate new or more restrictive airworthiness limitations, as specified in EASA AD 2021-0246.

The FAA is issuing this AD to address fatigue cracking, accidental damage, or corrosion in principal structural elements, and possible failure of certain life limited parts, which could result in reduced structural integrity of the airplane. See the MCAI for additional background information.

The FAA received comments from the Air Line Pilots Association, International (ALPA) who supported the NPRM without change.

The FAA reviewed the relevant data, considered the comment received, and determined that air safety requires adopting this AD as proposed. Except for minor editorial changes, this AD is adopted as proposed in the NPRM. None of the changes will increase the economic burden on any operator. Accordingly, the FAA is issuing this AD to address the unsafe condition on these products.

EASA AD 2021-0246 specifies procedures for new or more restrictive airworthiness limitations for airplane structures and safe life limits.

This AD also requires the following service information.

• Airbus A330 Airworthiness Limitations Section (ALS) Part 1, Safe Life Airworthiness Limitation Items (SL-ALI), Revision 09, dated September 18, 2017, which the Director of the Federal Register approved for incorporation by reference as of January 2, 2019 (83 FR 60754, November 27, 2018).

• Airbus A330 ALS Part 1, SL-ALI, Variation 9.2, dated November 28, 2017, which the Director of the Federal Register approved for incorporation by reference as of January 2, 2019 (83 FR 60754, November 27, 2018).

• Airbus A330 ALS Part 1, SL-ALI, Variation 9.3, dated November 29, 2017, which the Director of the Federal Register approved for incorporation by reference as of January 2, 2019 (83 FR 60754, November 27, 2018).

• EASA AD 2020-0190, dated August 27, 2020, which the Director of the Federal Register approved for incorporation by reference as of April 26, 2021 (86 FR 15092, March 22, 2021).

This material is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

The FAA estimates that this AD affects 138 airplanes of U.S. registry. The FAA estimates the following costs to comply with this AD:

The FAA estimates the total cost per operator for the retained actions from AD 2018-23-14 and AD 2021-05-12 to be $7,650 (90 work-hours × $85 per work-hour) per AD.

The FAA has determined that revising the existing maintenance or inspection program takes an average of 90 work-hours per operator, although the agency recognizes that this number may vary from operator to operator. Since operators incorporate maintenance or inspection program changes for their affected fleet(s), the FAA has determined that a per-operator estimate is more accurate than a per-airplane estimate.

The FAA estimates the total cost per operator for the new actions to be $7,650 (90 work-hours × $85 per work-hour).

Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. Subtitle VII: Aviation Programs, describes in more detail the scope of the Agency's authority.

The FAA is issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701: General requirements. Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.

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

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

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

(2) Will not affect intrastate aviation in Alaska, and

(3) Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

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

The FAA issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 by adding an AD that would apply to certain serial-numbered Piaggio Model P-180 airplanes. The NPRM published in the Federal Register on April 8, 2022 (87 FR 20790). The NPRM was prompted by MCAI originated by the European Union Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Union. EASA issued EASA AD 2019-0269, dated October 29, 2019 (referred to after this as “the MCAI”), to address the unsafe condition on Piaggio Model P.180 Avanti II airplanes. The MCAI states:

You may examine the MCAI in the AD docket at www.regulations.gov by searching for and locating Docket No. FAA-2022-0397.

In the NPRM, the FAA proposed to require amending the existing AFM, installing improved ADCs and a DCM, and revising the existing instructions for continued airworthiness. The FAA is issuing this AD to prevent a mean altimetry system error measurement from exceeding the limits defined for operations within airspace designed as RVSM airspace. The unsafe condition, if not addressed, could result in a potential mid-air collision within RVSM airspace.

The FAA received a comment from Piaggio. The following presents the comment received on the NPRM and the FAA's response to the comment.

Piaggio requested that the FAA revise the NPRM to update their contact information for service information.

The FAA agrees and has updated the contact information for Piaggio accordingly.

This product has been approved by the aviation authority of another country and is approved for operation in the United States. Pursuant to the FAA's bilateral agreement with this State of Design Authority, it has notified the FAA of the unsafe condition described in the MCAI and service information referenced above. The FAA reviewed the relevant data, considered the comment received, and determined that air safety requires adopting this AD as proposed. Accordingly, the FAA is issuing this AD to address the unsafe condition on this product. Except for the changes described previously, this AD is adopted as proposed in the NPRM. None of the changes will increase the economic burden on any operator.

The FAA reviewed Piaggio Aero Industries S.p.A. A.S. Service Bulletin No. 80-0467, Revision 2, dated March 6, 2020, which specifies procedures for replacing the two ADCs and the DCM with improved parts.

The FAA also reviewed Piaggio Aviation P.180 Avanti II/EVO Temporary Change No. 107, dated September 17, 2019, which updates the limitations section of the AFM by prohibiting operations in RVSM airspace if the ADCs and DCM have not been replaced.

In addition, the FAA reviewed Piaggio Aviation P.180 Avanti EVO Maintenance Manual Temporary Revision No. 126, dated June 6, 2019, which updates and adds certain tasks for the navigation system.

This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

The MCAI requires informing all flight crews of the AFM revision and operating accordingly thereafter, and this AD does not because those actions are already required by FAA operating regulations.

The FAA estimates that this AD will affect 101 airplanes of U.S. registry.

The FAA estimates the following costs to comply with this AD:

Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. Subtitle VII: Aviation Programs, describes in more detail the scope of the Agency's authority.

The FAA is issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701: General requirements. Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.

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

For the reasons discussed above, I certify this AD:

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

(2) Will not affect intrastate aviation in Alaska, and

(3) Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

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

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. Subtitle I, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of the airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it modifies the route structure as necessary to preserve the safe and efficient flow of air traffic within the NAS.

The FAA published a notice of proposed rulemaking for Docket No. FAA-2022-0475, in the Federal Register (87 FR 27956; May 10, 2022) establishing six RNAV T-routes in the northeast United States to support the VOR MON Program. Interested parties were invited to participate in this rulemaking effort by submitting written comments on the proposal. No comments were received.

United States RNAV T-routes are published in paragraph 6011 of FAA Order JO 7400.11F, dated August 10, 2021, and effective September 15, 2021, which is incorporated by reference in 14 CFR 71.1. The RNAV routes listed in this document will be subsequently published in FAA Order JO 7400.11.

The FAA proposed to establish six RNAV T routes. However, subsequent to the NPRM, the FAA determined that further coordination is required on routes T-428, T-434, and T-436 before they can be implemented. Therefore, those three routes are removed from this rule and will be implemented at a later date under a separate docket. This rule establishes only T-416, T-430, and T-438 as proposed.

This document amends FAA Order JO 7400.11F, Airspace Designations and Reporting Points, dated August 10, 2021, and effective September 15, 2021. FAA Order JO 7400.11F is publicly available as listed in the ADDRESSES section of this document. FAA Order JO 7400.11F lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

This action amends 14 CFR part 71 by establishing three low altitude RNAV T-routes, designated T-416, T-430, and T-438, in the northeast United States to support the VOR MON Program.

T-416: T-416 extends between the Smyrna, DE (ENO), VHF Omnidirectional Range and Tactical Air Navigational System (VORTAC) and the PREPI, OA, Fix (OA means “Offshore Atlantic”). The route overlays VOR Federal airway V-312 between the ALBEK, NJ, Fix, and the PREPI Fix. At the PREPI Fix, T-416 connects with the oceanic route structure.

T-430: T-430 extends between the Philipsburg, PA (PSB), VORTAC, and the Solberg, NJ (SBJ), VOR/DME. The route overlays airway V-30 between the Philipsburg VORTAC and the Solberg VOR/DME.

T-438: T-438 extends between the RASHE, PA, Fix, and the PREPI, OA, Fix. It overlays airway V-276 between the RASHE Fix and the PREPI Fix.

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

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

The FAA has determined that this action of establishing three low altitude RNAV T-routes, designated T-416, T-430, and T-438, in the northeast United States, in support of efforts transitioning the NAS from ground-based to satellite-based navigation, qualifies for categorical exclusion under the National Environmental Policy Act (42 U.S.C. 4321 et seq. ) and its implementing regulations at 40 CFR part 1500, and in accordance with FAA Order 1050.1F, Environmental Impacts: Policies and Procedures, paragraph 5-6.5a, which categorically excludes from further environmental impact review rulemaking actions that designate or modify classes of airspace areas, airways, routes, and reporting points (see 14 CFR part 71, Designation of Class A, B, C, D, and E Airspace Areas; Air Traffic Service Routes; and Reporting Points). As such, this action is not expected to result in any potentially significant environmental impacts. In accordance with FAA Order 1050.1F, paragraph 5-2 regarding Extraordinary Circumstances, the FAA has reviewed this action for factors and circumstances in which a normally categorically excluded action may have a significant environmental impact requiring further analysis. Accordingly, the FAA has determined that no extraordinary circumstances exist that warrant preparation of an environmental assessment or environmental impact study.

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

Section 104(b)(1) of the CPSIA requires the Commission to assess the effectiveness of voluntary standards for durable infant or toddler products and to adopt mandatory standards for these products. 15 U.S.C. 2056a(b)(1). A mandatory standard must be “substantially the same as” the corresponding voluntary standard, or it may be “more stringent than” the voluntary standard, if the Commission determines that more stringent requirements would further reduce the risk of injury associated with the product. Id.

Section 104(b)(4)(B) of the CPSIA specifies the process for updating the Commission's rules when a voluntary standards organization revises a standard that the Commission previously incorporated by reference under section 104(b)(1). First, the voluntary standards organization must notify the Commission of the revision. Once the Commission receives this notification, the Commission may reject or accept the revised standard. The Commission may reject the revised standard by notifying the voluntary standards organization, within 90 days of receiving notice of the revision, that it has determined that the revised standard does not improve the safety of the consumer product and that it is retaining the existing standard. If the Commission does not take this action to reject the revised standard, then the revised voluntary standard will be considered a consumer product safety standard issued under section 9 of the Consumer Product Safety Act (15 U.S.C. 2058), effective 180 days after the Commission received notification of the revision or on a later date specified by the Commission in the Federal Register . 15 U.S.C. 2056a(b)(4)(B).

Under section 104(b)(1) of the CPSIA, the Commission adopted a mandatory rule for infant bouncer seats, codified in 16 CFR part 1229. The rule incorporated by reference ASTM F2167-17, Standard Consumer Safety Specification for Infant Bouncer Seats, with no modifications. 82 FR 43470 (Sep. 18, 2017). At the time the Commission published the final rule, ASTM F2167-17 was the current version of the voluntary standard. ASTM revised the voluntary standard in May 2019. In September 2019, the Commission revised the mandatory standard to incorporate by reference ASTM F2167-19. 84 FR 46878 (Sep. 6, 2019).

On June 22, 2022, ASTM notified CPSC that it has once more revised the voluntary standard for infant bouncer seats, by approving ASTM F2167-22 on May 1, 2022. On June 30, 2022, the Commission published a notice of availability in the Federal Register regarding the revised voluntary standard and sought comments on the effect of the revisions on the safety of the standard for infant bouncer seats. 87 FR 39068 (Jun. 30, 2022). No comments were submitted.

As discussed in section B. Revisions to ASTM F2167, based on CPSC staff's review of ASTM F2167-22, 1 the Commission will allow the revised voluntary standard to become the mandatory standard because it improves the safety of infant bouncer seats. 2 Accordingly, by operation of law under section 104(b)(4)(B) of the CPSIA, ASTM F2167-22 will become the mandatory consumer product safety standard for infant bouncer seats on December 19, 2022. 15 U.S.C. 2056a(b)(4)(B). This direct final rule updates 16 CFR part 1229 to incorporate by reference the revised voluntary standard, ASTM F2167-22.

The ASTM standard for infant bouncer seats includes performance requirements, test methods, and requirements for warning labels and instructional literature, to address hazards to children associated with infant bouncer seats. ASTM F2167-22 contains substantive revisions as well as editorial, non-substantive revisions. These revisions from ASTM F2167-19 to ASTM F2167-22 consist of changes to the infant bouncer seat warning label language, as well as changes that do not impact safety because they do not change the meaning of the standard and are editorial in nature. The Commission concludes that these changes collectively improve the safety of infant bouncer seats, and none has an adverse effect on safety. Below is a detailed discussion of the substantive and non-substantive changes made to ASTM F2167-19.

ASTM F2167-22 revised the suffocation-related warnings to clarify that the product is not intended or safe for sleep and directs consumers to move the baby to a flat sleep surface if the baby falls asleep in the product. Specifically, in section 8.5.2 of ASTM F2167-19, the suffocation hazard warning language stated:

Suffocation hazard: Babies have suffocated when bouncers have tipped over on soft surfaces.

• NEVER use product on a bed, sofa, cushion, or other soft surface.

• NEVER leave baby unattended.

To prevent falls and suffocation:

• ALWAYS use restraints and adjust to fit snugly, even if baby falls asleep.

ASTM F2167-22 revised the suffocation hazard warning section to the following:

Suffocation hazard: Babies have suffocated when bouncers tipped over on soft surfaces and/or when bouncers have been used as a sleep product.

• NEVER use on a bed, sofa, cushion, or other soft surface.

• Stay near and watch baby during use. This product is not safe for sleep or unsupervised use. If baby falls asleep, remove baby as soon as possible and place baby on a firm, flat sleep surface such as a crib or bassinet.

To prevent falls and suffocation:

• ALWAYS use restraints and adjust to fit snugly.

The statements advising caregivers to always use restraints and adjust to fit snugly, which is on both the fall hazard and suffocation hazard warnings, have now been updated by removing the statement: “even if baby falls asleep.” Specifically, in sections 8.5.1.1 and 8.5.2.1 of ASTM F2167-19, the contained the statement:

• ALWAYS use restraints and adjust to fit snugly, even if baby falls asleep.

ASTM F2167-22 revised the statement to the following:

• ALWAYS use restraints and adjust to fit snugly.

The warning language in the 2019 version that recommended using and adjusting the restraints includes the phrase: “even if baby falls asleep,” which may suggest to users that using bouncers for infant sleep is acceptable. The ASTM subcommittee has since concluded that bouncers should not be used for sleep. Thus, the 2022 revision deletes this phrase and adds clarifying language to communicate clearly to consumers that: “This product is not safe for sleep or unsupervised use,” while reinforcing the message that babies should sleep in cribs, bassinets, or other firm, flat sleep surfaces. These changes improve safety.

The Commission also considers the change from “NEVER leave child unattended” to “Stay near and watch baby during use” to be an improvement in safety. Consumers are more likely to understand a message directly instructing them on what to do to avoid the hazard. A user study conducted for CPSC to assess this language concluded that caregivers prefer clear and straight-to-the-point phrases. The researchers further concluded that many caregivers misinterpret the words “unattended” and “unsupervised,” and these terms should be replaced with less ambiguous phrases.

The Commission considers the modified suffocation warnings an improvement to safety because they provide clear and concise instructions for safe use of an infant bouncer. The new warning statement provides concise guidance to the caregiver that infant bouncer seats are not safe for sleep, and it provides guidance that is consistent with CPSC messaging about the importance of placing sleeping babies on firm, flat sleep surfaces, such as a crib or bassinet.

Finally, changes were made to the wording in the corresponding Figures indicated below to reflect the current Ad-Hoc Recommendations:  3

• Figure.11 Fall Hazard Warnings;

• Figure.12 Suffocation Hazard Warnings; and

• Figure. 13, Instruction Warnings Statements.

The Commission considers these changes to be an improvement to safety because the changes are consistent with revisions to language made to Subsection 8.5.1.1 and 8.5.2.1, and thus may avoid consumer confusion, and because they discourage caregivers from using the product for sleep.

ASTM F2167-22 makes several non-substantive changes to the standard. The following has been added to the Appendix:

X1.9 Subsection 8.5.2.1 —Change in the form of an added statement to explain the non-relevance and removal of “even if baby is sleeping” from the Appendix Rationale in the new standard. This change does not impact safety because it does not affect the information available to consumers.

Finally, several minor editorial changes adding hyphens to language in the standard were made. The Commission finds that the non-substantive changes made in ASTM F2167-22 regarding safety for infant bouncer seats do not impact safety.

Section 1229.2 of the direct final rule incorporates by reference ASTM F2167-22. The Office of the Federal Register (OFR) has regulations regarding incorporation by reference. 1 CFR part 51. Under these regulations, agencies must discuss, in the preamble to a final rule, ways in which the material the agency incorporates by reference is reasonably available to interested parties, and how interested parties can obtain the material. In addition, the preamble to the final rule must summarize the material. 1 CFR 51.5(b).

In accordance with the OFR regulations, section B. Revisions to ASTM F2167 of this preamble summarizes the major provisions of ASTM F2167-22 that the Commission incorporates by reference into 16 CFR part 1229. The standard is reasonably available to interested parties. Until the direct final rule takes effect, a read-only copy of ASTM F2167-22 is available for viewing, at no cost, on ASTM's website at: www.astm.org/CPSC.htm. Once the rule takes effect, a read-only copy of the standard will be available for viewing, at no cost, on the ASTM website at: www.astm.org/READINGLIBRARY/. Interested parties can also schedule an appointment to inspect a copy of the standard at CPSC's Office of the Secretary, U.S. Consumer Product Safety Commission, Room 820, 4330 East-West Highway, Bethesda, MD 20814, telephone: (301) 504-7479; email: cpsc-os@cpsc.gov. Interested parties can purchase a copy of ASTM F2167-22 from ASTM International, 100 Barr Harbor Drive, P.O. Box C700, West Conshohocken, PA 19428-2959 USA; telephone: (610) 832-9585; www.astm.org.

Section 14(a) of the Consumer Product Safety Act (CPSA; 15 U.S.C. 2051-2089) requires manufacturers of products subject to a consumer product safety rule under the CPSA, or to a similar rule, ban, standard, or regulation under any other act enforced by the Commission, to certify that the products comply with all applicable CPSC requirements. 15 U.S.C. 2063(a). Such certification must be based on a test of each product, or on a reasonable testing program, or for children's products, on tests of a sufficient number of samples by a third party conformity assessment body accredited by CPSC to test according to the applicable requirements. As noted, standards issued under section 104(b)(1)(B) of the CPSIA are “consumer product safety standards.” Thus, they are subject to the testing and certification requirements of section 14 of the CPSA.

Because infant bouncer seats are children's products, a CPSC-accepted third party conformity assessment body must test samples of the products. Products subject to part 1229 also must comply with all other applicable CPSC requirements, such as the lead content requirements in section 101 of the CPSIA, 4 the tracking label requirements in section 14(a)(5) of the CPSA, 5 and the consumer registration form requirements in section 104(d) of the CPSIA. 6 ASTM F2167-22 makes no changes that would impact any of these existing requirements.

In accordance with section 14(a)(3)(B)(vi) of the CPSA, the Commission previously published a notice of requirements (NOR) for accreditation of third party conformity assessment bodies for testing infant bouncer seats. 82 FR 43470 (Sep. 18, 2017). The NOR provided the criteria and process for CPSC to accept accreditation of third party conformity assessment bodies for testing infant bouncer seats to 16 CFR part 1229. The NORs for all mandatory standards for durable infant or toddler products are listed in the Commission's rule, “Requirements Pertaining to Third Party Conformity Assessment Bodies,” codified in 16 CFR part 1112. Id. CPSC-accepted testing laboratories that have ASTM F2167-19 in their scope of accreditation are competent to conduct testing to ASTM F2167-22. None of the changes to the standard would affect a CPSC-accepted laboratory's ability to conduct testing to the revised standard.

Therefore, the Commission considers the existing CPSC-accepted laboratories for testing to ASTM F2167-19 to be capable of testing to ASTM F2167-22 as well. Accordingly, the existing NOR for this standard will remain in place, and CPSC-accepted third party conformity assessment bodies are expected to update the scope of the testing laboratories' accreditations to reflect the revised standard in the normal course of renewing their accreditations. Thus, laboratories will begin testing to the new standard when ASTM F2167-22 goes into effect, and the existing accreditations that the Commission has accepted for testing to this standard will cover testing to the revised standard.

The Commission is issuing this rule as a direct final rule. Although the Administrative Procedure Act (APA; 5 U.S.C. 551-559) generally requires agencies to provide notice of a rule and an opportunity for interested parties to comment on it, section 553 of the APA provides an exception when the agency “for good cause finds” that notice and comment are “impracticable, unnecessary, or contrary to the public interest.” Id. 553(b)(B). The Commission concludes that when it updates a reference to an ASTM standard that the Commission incorporated by reference under section 104(b) of the CPSIA, notice and comment are not necessary.

Specifically, under the process set out in section 104(b)(4)(B) of the CPSIA, when ASTM revises a standard that the Commission has previously incorporated by reference under section 104(b)(1)(B) of the CPSIA, that revision will become the new CPSC standard, unless the Commission determines that ASTM's revision does not improve the safety of the product. Thus, unless the Commission makes such a determination, the ASTM revision becomes CPSC's standard by operation of law. The Commission is allowing ASTM F2167-22 to become CPSC's new standard because its provisions improve product safety. The purpose of this direct final rule is to update the Code of Federal Regulations (CFR) so that it reflects the version of the standard that takes effect by statute. This rule updates the reference in the CFR, but under the terms of the CPSIA, ASTM F2167-22 takes effect as the new CPSC standard for infant bouncer seats, even if the Commission does not issue this rule. Thus, public comments would not alter substantive changes to the standard or the effect of the revised standard as a consumer product safety standard under section 104(b) of the CPSIA. Under these circumstances, notice and comment are unnecessary.

In Recommendation 95-4, the Administrative Conference of the United States (ACUS) endorses direct final rulemaking as an appropriate procedure to expedite rules that are noncontroversial and not expected to generate significant adverse comments. See 60 FR 43108 (Aug. 18, 1995). ACUS recommends that agencies use the direct final rule process when they act under the “unnecessary” prong of the good cause exemption in 5 U.S.C. 553(b)(B). Consistent with the ACUS recommendation, the Commission is publishing this rule as a direct final rule, because CPSC does not expect any significant adverse comments.

Unless CPSC receives a significant adverse comment within 30 days of this notification, the rule will become effective on December 19, 2022. In accordance with ACUS's recommendation, the Commission considers a significant adverse comment to be “one where the commenter explains why the rule would be inappropriate,” including an assertion challenging “the rule's underlying premise or approach,” or a claim that the rule “would be ineffective or unacceptable without a change.” 60 FR 43108, 43111 (Aug. 18, 1995). As noted, this rule merely updates a reference in the CFR to reflect a change that occurs by statute, and public comments should address this specific action.

If the Commission receives a significant adverse comment, the Commission will withdraw this direct final rule. Depending on the comment and other circumstances, the Commission may then incorporate the adverse comment into a subsequent direct final rule or publish a notice of proposed rulemaking, providing an opportunity for public comment.

The Regulatory Flexibility Act (RFA; 5 U.S.C. 601-612) generally requires agencies to review proposed and final rules for their potential economic impact on small entities, including small businesses, and prepare regulatory flexibility analyses. 5 U.S.C. 603, 604. The RFA applies to any rule that is subject to notice and comment procedures under section 553 of the APA. Id. As discussed in section F. Direct Final Rule Process of this preamble, the Commission has determined that notice and the opportunity to comment are unnecessary for this rule. Therefore, the RFA does not apply. CPSC also notes the limited nature of this document, which merely updates the incorporation by reference to reflect the mandatory CPSC standard that takes effect under section 104 of the CPSIA.

The current mandatory standard for infant bouncer seats includes requirements for marking, labeling, and instructional literature that constitute a “collection of information,” as defined in the Paperwork Reduction Act (PRA; 44 U.S.C. 3501-3521). While the revised mandatory standard revises existing marking and labeling, and instructional literature language for infant bouncer seats, the revisions would not add to the burden hours because the products already require marking, labeling, and instructional literature. The new requirements merely require new words or wording changes to language already required by the standard for infant bouncer seats. Therefore, the new requirements are not materially more burdensome than the existing requirements. Conforming the mandatory standard for infant bouncer seats to ASTM's revision of the voluntary standard also reduces burdens on manufacturers who would follow the updated voluntary standard and thus, in the absence of this rule, be subject to partially inconsistent requirements.

The Commission took the steps required by the PRA for information collections when it promulgated 16 CFR part 1229, and the marking, labeling, and instructional literature for infant bouncer seats are currently approved under OMB Control Number 3041-0159. Because the information collection burden is unchanged, the revision does not affect the information collection requirements or approval related to the standard.

Under the procedure set forth in section 104(b)(4)(B) of the CPSIA, when a voluntary standards organization revises a standard that the Commission adopted as a mandatory standard, the revision becomes the CPSC standard 180 days after notification to the Commission, unless the Commission timely notifies the standards organization that it has determined that the revision does not improve the safety of the product, or the Commission sets a later date in the Federal Register . 15 U.S.C. 2056a(b)(4)(B). The Commission is taking neither of those actions with respect to the standard for infant bouncer seats. Therefore, ASTM F2167-22 will take effect as the new mandatory standard for infant bouncer seats on December 19, 2022, 180 days after June 22, 2022, when the Commission received notice of the revision.

Section 26(a) of the CPSA provides that where a consumer product safety standard is in effect and applies to a product, no state or political subdivision of a state may either establish or continue in effect a requirement dealing with the same risk of injury unless the state requirement is identical to the federal standard. 15 U.S.C. 2075(a). Section 26(c) of the CPSA also provides that states or political subdivisions of states may apply to CPSC for an exemption from this preemption under certain circumstances. Section 104(b) of the CPSIA deems rules issued under that provision “consumer product safety standards.” Therefore, once a rule issued under section 104 of the CPSIA takes effect, it will preempt in accordance with section 26(a) of the CPSA.

Commission rules are categorically excluded from any requirement to prepare an environmental assessment or an environmental impact statement where they “have little or no potential for affecting the human environment.” 16 CFR 1021.5(c)(2). This rule falls within the categorical exclusion, so no environmental assessment or environmental impact statement is required.

The Congressional Review Act (CRA; 5 U.S.C. 801-808) states that before a rule may take effect, the agency issuing the rule must submit the rule, and certain related information, to each House of Congress and the Comptroller General. 5 U.S.C. 801(a)(1). The CRA submission must indicate whether the rule is a “major rule.” The CRA states that the Office of Information and Regulatory Affairs determines whether a rule qualifies as a “major rule.”

Pursuant to the CRA, this rule does not qualify as a “major rule,” as defined in 5 U.S.C. 804(2). To comply with the CRA, CPSC will submit the required information to each House of Congress and the Comptroller General.

For the reasons discussed in the preamble, the Commission amends 16 CFR chapter II as follows:

The Indian Gaming Regulatory Act (IGRA or Act), Public Law 100-497, 25 U.S.C. 2701 et seq., was signed into law on October 17, 1988. The Act establishes the National Indian Gaming Commission (NIGC or Commission) and sets out a comprehensive framework for the regulation of gaming on Indian lands. The IGRA established an agency funding framework whereby gaming operations licensed by tribes pay a fee to the Commission for each gaming operation that conducts Class II or Class III gaming activity that is regulated pursuant to IGRA. 25 U.S.C. 2717(a)(1). These fees are used to fund the Commission in carrying out its regulatory authority. On August 15 1991, the NIGC published a final rule in the Federal Register called Annual Fees Payable By Class II Gaming Operations. 58 FR 5831. The rule added a new part to the Commission's regulations to provide direction and guidance to Class II gaming operations to enable them to compute and pay the annual fees as authorized by the Indian Gaming Regulatory Act. The Commission has substantively amended them numerous times, most recently in 2018 (83 FR 2903).

On, June 9, 2021, the National Indian Gaming Commission sent a Notice of Consultation announcing that the Commission intended to consult on a number of topics, including proposed changes to the fee regulations. Prior to consultation, the Commission released proposed discussion drafts of the regulations for review. The proposed amendment to the fee regulations were intended to provide clarity as to whether a tribal gaming operation must include certain promotional credits, commonly referred to as “free play,” as “money wagered” for purposes of calculating the annual fee. The Commission held two virtual consultation sessions in July of 2021 to receive tribal input on the possible changes.

The Commission reviewed all comments received as part of the consultation process. After considering the comments received from the public and through tribal consultations, the Commission published a notice of proposed rulemaking on December 2, 2021. 86 FR 68445.

The Commission received the following comments in response to our notice of proposed rulemaking.

Comment: Commenters recommended that the exclusion for promotional credits be mandatory rather than at the discretion of the tribal gaming operation. Commenters believe that the exclusion must be mandatory to prevent tribal gaming operations from paying fees on revenues that are not recognized under Generally Accepted Accounting Principles. Commenters also believe that discretionary language permits the NIGC to determine whether to accept the exclusion of promotional credits from the calculation of assessable gross revenues by tribal gaming operations on a discretionary basis. Finally, commenters believe that discretionary language may prompt reconsideration of promotional credit treatment in tribal-state compacts.

Response: The Commission accepts this recommendation to provide a uniform calculation of the annual fee. The Commission initially made the deduction discretionary because it noted that a sizeable percentage of tribe gaming operations were not deducting promotional credits from the calculation of fees. The Commission had hoped that through consultation it would gain insight into those tribes' reasons for including free play in the calculation of fees. When the subject was not addressed by any tribes during consultation, the Commission drafted a notice of proposed rulemaking that maintained the discretionary nature of the withholding. Again, Commenters unanimously called for the deduction to be made mandatory. The Commission agrees that promotional credits should not be included in the calculation of fees. To ensure that fees are calculated uniformly across the Tribal gaming industry, it has adopted language as set forth below. The Commission further clarifies, however, that this regulation is limited to NIGC fee calculations and is not intended to affect revenue calculations for any other purposes.

Comment: Commenters are concerned that the phrase “can demonstrate” does not provide a clear standard for the deduction.

Response: The Commission agrees that the phrase “can demonstrate” is redundant and has removed the phrase. The Commission notes that “promotional gaming credits” means Gaming credits issued to patrons for wagering that have no cash redemption value; typically used as “Free Play” for gaming machine, table games, and other gaming activity promotions. The Commission further notes that all fee calculations must continue to be reconciled with a tribe's audited or reviewed financial statements pursuant to 25 CFR 514.6.

Comment: Commenters recommended incorporating the promotional credit exclusion provision within the text of 25 CFR 514.4(c) rather than as a new paragraph.

Response: The Commission agrees that the simplified promotional credit exclusion provision may be included within 25 CFR 514.4(c).

The rule will not have a significant impact on a substantial number of small entities as defined under the Regulatory Flexibility Act, 5 U.S.C. 601, et seq. Moreover, Indian Tribes are not considered to be small entities for the purposes of the Regulatory Flexibility Act.

The rule is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act. The rule does not have an effect on the economy of $100 million or more. The rule will not cause a major increase in costs or prices for consumers, individual industries, Federal, State, local government agencies or geographic regions, nor will the rule have a significant adverse effect on competition, employment, investment, productivity, innovation, or the ability of the enterprises, to compete with foreign based enterprises.

The Commission, as an independent regulatory agency, is exempt from compliance with the Unfunded Mandates Reform Act, 2 U.S.C. 1502(1); 2 U.S.C. 658(1).

In accordance with Executive Order 12630, the Commission has determined that the rule does not have significant takings implications. A takings implication assessment is not required.

In accordance with Executive Order 12988, the Commission has determined that the rule does not unduly burden the judicial system and meets the requirements of sections 3(a) and 3(b)(2) of the Order.

The Commission has determined that the rule does not constitute a major federal action significantly affecting the quality of the human environment and that no detailed statement is required pursuant to the National Environmental Policy Act of 1969, 42 U.S.C. 4321, et seq.

The information collection requirements contained in this rule were previously approved by the Office of Management and Budget (OMB) as required by 44 U.S.C. 3501 et seq. and assigned OMB Control Number 3141-0007.

The National Indian Gaming Commission is committed to fulfilling its tribal consultation obligations—whether directed by statute or administrative action such as Executive Order (E.O.) 13175 (Consultation and Coordination with Indian Tribal Governments)—by adhering to the consultation framework described in its Consultation Policy published July 15, 2013. The NIGC's consultation policy specifies that it will consult with tribes on Commission Action with Tribal Implications, which is defined as: Any Commission regulation, rulemaking, policy, guidance, legislative proposal, or operational activity that may have a substantial direct effect on an Indian tribe on matters including, but not limited to the ability of an Indian tribe to regulate its Indian gaming; an Indian Tribe's formal relationship with the Commission; or the consideration of the Commission's trust responsibilities to Indian tribes. As discussed above, the NIGC engaged in extensive consultation on this topic and received and considered comments in developing this rule.

For the reasons set forth in the preamble, the Commission amends 25 CFR part 514 as follows:

The Employee Retirement Income Security Act of 1974, as amended (ERISA), contains provisions designed to protect the interests of plan participants and beneficiaries by requiring the establishment of effective mechanisms to detect and deter abusive practices. This includes requiring annual reporting of financial information and activities of employee benefit plans to the Department of Labor (Department). Sections 101, 103 and 104 of ERISA impose annual reporting and filing obligations on pension and welfare benefit plans. Plan administrators, employers, and others generally satisfy these annual reporting obligations pursuant to the Department's implementing regulations by filing a Form 5500 (Annual Return/Report of Employee Benefit Plan) together with any required schedules and attachments. An integral component of ERISA's annual reporting provisions is the requirement that employee benefit plans, unless otherwise exempt, be subjected to an annual audit performed by an independent qualified public accountant (IQPA), and that the accountant's report be included as part of the plan's Form 5500 annual report filed with the Department. 1 The IQPA requirements in ERISA were intended to protect the assets and the financial integrity of employee benefit plans, and provide participants, beneficiaries, plan administrators, other plan fiduciaries, and the Department with reliable information about an employee benefit plan and its financial soundness.

Section 103(a)(3)(A) of ERISA, codified at 29 U.S.C. 1023(a)(3)(A), sets forth the requirements governing the IQPA's annual audit. The administrator of an employee benefit plan is required to engage, on behalf of all plan participants, an IQPA to conduct an examination of the plan's financial statements, and other books and records of the plan, as the accountant deems necessary to form an opinion on whether the financial statements required to be included in the plan's annual report are presented fairly in accordance with generally accepted accounting principles (GAAP) applied on a basis consistent with that of the preceding year and whether the schedules required to be included in the plan's annual report present fairly, and in all material respects the information contained therein when considered in conjunction with the financial statements taken as a whole. Section 103(a)(3)(A) of ERISA further requires that the accountant's examination must be conducted “in accordance with generally accepted auditing standards [(GAAS)], and shall involve such tests of the books and records of the plan as are considered necessary by the independent qualified public accountant.”  2 The accountant's report must contain certain opinions with respect to the financial statements and schedules covered by the report and the accounting principles and practices reflected in such report. Further, the accountant's report must identify any matters to which the accountant takes exception, whether the matters to which the accountant takes exception are the result of the Department's regulations and, to the extent practicable, the effect on the financial statements of the matters to which the accountant has taken exception. If the auditor's independence is considered to have been impaired after the audit is completed, a new audit by another accountant may be required. 3

Section 103(a)(3)(D) of ERISA, codified at 29 U.S.C. 1023(a)(3)(D), states that the term “qualified public accountant” means—(i) a person who is a certified public accountant, certified by a regulatory authority of a State; (ii) a person who is a licensed public accountant, licensed by a regulatory authority of a State; or (iii) a person certified by the Secretary as a qualified public accountant in accordance with regulations published by the Secretary for a person who practices in States where there is no certification or licensing procedure for accountants. Although section 103 of ERISA does not include a definition of the term “independent” for purposes of the audit requirement, in the Department's view, an accountant's independence is at least of equal importance to the professional competence an accountant brings to an engagement in rendering an opinion and issuing a report on the financial statements of an employee benefit plan and the schedules required to be included in the plan's annual report. Thus, pursuant to the Department's authority to interpret and enforce section 103(a)(3)(A) of ERISA, the Department issued Interpretive Bulletin 75-9 in 1975 to provide guidelines for determining when an accountant is independent for purposes of ERISA's annual reporting requirements. 4

No explanatory preamble accompanied the 1975 IB when it was published, 5 but its structure and provisions were largely predicated on specific principles that generally parallel the Securities and Exchange Commission's (SEC) independence requirements for auditing publicly traded companies. Specifically, the auditor (1) cannot function in the role of management, (2) cannot audit his or her own work, (3) cannot serve in roles or have relationships that create mutual or conflicting financial interests, and (4) cannot be in a position of being an advocate for the audit client. 6 The 1975 IB reflected these principles by setting forth three specific sets of circumstances that would conclusively render the accountant to not be independent—the first is based on certain roles and statuses, the second is based on financial interests, and the third is based on engaging in management functions related to financial records that would be the subject of the audit—and by setting forth a general facts and circumstances approach that would govern in all other cases.

The Department has periodically been asked to clarify and update its guidelines on the independence of accountants to adjust to changes in the accounting industry and to address differences that have developed as other regulatory authorities have adopted changes to their auditor independence requirements. Accountants and accounting firms have pointed to the challenges of monitoring compliance with different independence standards that apply to different business sectors for which they provide audit services. They have also noted that the nature and complexity of the business environment in which accountants perform services has changed in ways that have led many accounting firms to develop expertise in an array of activities in addition to audit services that may be provided to audit clients. For example, accountants may engage in business consulting, valuation and appraisal services, applications programming, electronic data processing, and recordkeeping.

In the years following the 1975 IB, other regulatory authorities have addressed and revisited issues relating to accountant independence. For example, on January 28, 2003, the SEC adopted final rules regarding independence for auditors that file financial statements with the SEC implementing Title II of the Sarbanes-Oxley Act of 2002. 7 The SEC further amended its auditor independence rules in 2019 and 2020. 8 The Sarbanes-Oxley Act also authorized the establishment of the Public Company Accounting Oversight Board (PCAOB), which requires that a registered public accounting firm and its associated persons be independent of the firm's audit client throughout the audit and professional engagement period. 9 The United States Government Accountability Office (GAO) has similarly published auditor independence requirements under Government Auditing Standards that cover federal entities and organizations receiving federal funds. See GAO, The Yellow Book, www.gao.gov/yellowbook/overview. The AICPA, although a private membership organization, sets GAAS requirements for non-PCAOB audits, which, ERISA 103(a)(3)(A) expressly adopted for plan audits, and GAAS includes standards by which the auditor must abide to avoid impairment of independence. See AICPA, www.aicpa.org. Many states have also included an independence component in their requirements for licensed public accountants. Some have specifically adopted the AICPA's Code of Professional Conduct, including its independence guidelines, while others have adopted state-specific rules.

In 2006, the Department issued a Request for Information (RFI) on Independence of Employee Benefit Plan Accountants which sought information from the public to assist the Department in evaluating whether the guidelines in the 1975 IB provided adequate guidance for plan officials, participants and beneficiaries, accountants, and other affected parties. 10 The Department solicited public input on a broad range of issues, including fifteen separate questions on particular areas. After reviewing the public comments submitted in response to the RFI, the Department did not undertake a rulemaking project on accountant independence or otherwise change the Department's interpretive stance on accountant independence generally. The Department also concluded that suggestions from some commenters that the Department simply adopt the SEC's current rules or guidelines on accountant independence or the ethics-based independence guidelines of the AICPA would have required a significant departure from the Department's largely facts and circumstances approach, to a more detailed and prescriptive approach to independence determinations. 11 The Department also concluded that it was not necessary to formally incorporate all or part of the AICPA independence guidelines into an updated IB. Compliance with the AICPA independence guidelines is already part of the GAAS audit requirement incorporated into statute by ERISA section 103(a)(3)(A) and also part of the Department's general relevant facts and circumstances approach to the accountant independence requirement. Further, the Department was concerned that expressly adopting either the AICPA or another regulator's requirements as the ERISA standard could result in unintended and undesirable outcomes to the extent that aspects of those other standards or future changes to those standards departed from ERISA policies and purposes.

Although not directly related to the accountant independence requirement, the Employee Benefit Security Administration (EBSA) Office of the Chief Accountant (OCA) actively engages in an ongoing assessment of the level and quality of audit work performed by IQPAs with respect to financial statement audits of employee benefit plans covered by ERISA. 12 This assessment began as a follow-up to a 1989 report issued by the Office of Inspector General (OIG) in which the OIG concluded that 23% of employee benefit plan audits failed to comply with one or more established professional standards. In addition, the OIG found that 65% of IQPA reports on employee benefit plans did not meet the reporting and disclosure requirements of ERISA and the regulations thereunder. The primary objective of EBSA's ongoing review has been to assess whether the level and quality of audit work performed by IQPAs with respect to audits of employee benefit plans covered by ERISA had improved as a result of actions taken by the Department and the accounting and auditing profession since the issuance of the OIG's 1989 report.

EBSA also implemented an Audit Quality Inspection Program in 2005 that significantly expanded OCA's inspection of IQPAs' work as compared to OCA's former on-site audit work paper reviews and “mini” inspections. The expanded program has two main components: (1) inspections of IQPAs' employee benefit plan audit practices and (2) reviews of a sample of the IQPAs' employee benefit plan audit work papers. EBSA has published two reports on the results of its assessments and recommendations for improvements, one in 2004 and another in 2015. Work on a third report is underway. One important report finding is that there is a clear link between the number of employee benefit plan audits performed by a certified public accountant (CPA) and the quality of the audit work performed. As set out in the May 2015 Report, the Department's analysis of the data from this audit quality survey indicated a wide disparity in deficiency rates between those CPAs who perform the fewest plan audits and those firms that perform the largest number of plan audits. CPAs who performed the fewest number of employee benefit plan audits annually had a 76% deficiency rate for the audits, meaning that the audit contained deficiencies with respect to one or more relevant GAAS requirements. In contrast, accountants in firms performing the most plan audits had a deficiency rate of 12% for the audits. 13 As noted above, the Department did not open a rulemaking project after its 2006 RFI, but it has continued to engage with accounting industry stakeholders, including efforts to encourage plan fiduciaries to engage auditors who perform high-quality employee benefit plan audits. 14 That engagement more recently has focused on whether the Department can adjust the 1975 IB to remove outdated or unnecessarily restrictive provisions with the goal of fostering greater plan access to high-quality auditors for ERISA plans and better aligning the Department's independence guidelines with those of other accounting regulatory bodies. Based on that continuing engagement, the Department is persuaded that certain changes to the 1975 IB independence guidelines can be implemented that would be consistent with the goal of expanding employee benefit plan access to the most qualified accountants and accounting firms while ensuring that the guidelines continue to foster proper auditor independence. In addition to making the adjustments described in more detail below, the Department has reorganized the interpretive bulletin for clarity.

The 1975 IB set out the Department's view that an accountant cannot conduct the ERISA-required audit of a plan's financial statements if the accountant, the accountant's firm, or a “member” of the firm has a “direct financial interest or material indirect financial interest” in the plan or plan sponsor “during the period covered by the financial statements” or “[d]uring the period of professional engagement.” For example, assume a calendar-year publicly traded sponsor of an employee benefit plan decides to change its accountant in March 2021 to perform the audit of the benefit plan's calendar year 2020 Form 5500 financial statements, which must be filed with the Department for calendar year plans no later than the maximum extended due date of October 15, 2021. Under the 1975 IB, the new accountant would be ineligible to audit the benefit plan's financial statements if even one partner of the firm held a single share of the publicly traded stock of the sponsor at any time during 2020, the year under audit. The AICPA, in the context of our ongoing engagement on independence issues and in a letter to EBSA dated March 15, 2019, advised that the requirement that the accountant not have such an interest “during the period covered by the financial statements” departs from the rules of other accounting regulatory bodies because it prevents auditors from avoiding disqualification by disposing of the financial interest prior to the period of the professional engagement ( i.e., before signing the initial audit engagement letter or commencing audit procedures). 15

The Department is persuaded that the absence of a divestiture provision for certain financial interests in the 1975 IB makes it unnecessarily restrictive and may serve to unduly limit ERISA plans' access to the best qualified auditors. In the Department's view, requiring that an accountant (or a member of the accountant's firm) not have such a financial interest in the publicly traded securities of the plan sponsor during the period covered by the financial statements (in contrast to the period of the engagement) is not necessary to ensure an accountant's independence. By disposing of such publicly traded securities prior to the engagement, firms and accountants can readily eliminate concern about independence and give plans access to their audit services.

Therefore, subject to a limitation described below, the Department is revising its independence guidelines to provide an exception for new audit engagements from the otherwise applicable condition on holding disqualifying financial interests during the period covered by the financial statements being audited. Under this approach, an accountant or firm is not disqualified from accepting a new audit engagement merely because of holding publicly traded securities of a plan sponsor during the period covered by the financial statements as long as the accountant, accounting firm, partners, shareholder employees, and professional employees of the accountant's accounting firm, and their immediate family, have disposed of any holdings of such publicly traded securities prior to the period of professional engagement. The updated IB also includes a definition of the “period of professional engagement” that provides the term means the period beginning when an accountant either signs an initial engagement letter or other agreement to perform the audit or begins to perform any audit, review or attest procedures (including planning the audit of the plan's financial statements), whichever is earlier, and ending with the formal notification, either by the member or client, of the termination of the professional relationship or the issuance of the audit report for which the accountant was engaged, whichever is later. This exception provides accountants with a divestiture window between the time when there is an oral agreement or understanding that a new client has selected them to perform the plan audit and the time an initial engagement letter or other written agreement is signed or audit procedures commence, whichever is sooner. 16

The new audit engagement exception is limited to publicly traded securities. For purposes of the exception, publicly traded securities are securities listed on a registered stock exchange in which quotations are published on a daily basis, securities regularly traded in a national or regional over-the-counter market for which published quotations are available, or securities traded on a foreign national securities exchange that is officially recognized, sanctioned, or supervised by a governmental authority and where the security is deemed by the SEC as having a ready market under applicable SEC rules. The ERISA auditor independence rules often apply to private and closely held organizations that sponsor plans. In the Department's view, incentives for an auditor to apply less robust audit procedures or to be less transparent in reporting audit results could carry over from other financial interests in the sponsor held during the period covered by the financial statements being audited. Accordingly, in order to maintain the important protections and public confidence that auditor independence provides, the updated IB continues to provide that other financial interests in the plan sponsor during the period covered by the financial statements categorically impair the accountant's independence even if divested before commencing a new audit engagement.

Furthermore, the Department is of the view that it is appropriate that an accountant's relative's ownership interest in a plan sponsor be attributed to the accountant in appropriate circumstances in order to preserve the accountant's and the firm's independence. 17 Although not expressly incorporated into the other examples in the 1975 IB, the Department has and will continue generally to treat the attribution rules in the AICPA independence standard as a relevant fact and circumstance, and, accordingly, has and will continue to consider spouse and dependent ownership and roles in our enforcement of the ERISA section 103(a)(3)(A) requirements governing IQPA audits.

The updated IB continues the current guideline under which an independent, qualified public accountant may permissibly engage in or have members of the accountant's accounting firm engage in certain professional services to the plan or plan sponsor that are not connected to an audit or review of a plan's financial statements without being deemed to have failed the independence requirement. Specifically, the updated IB continues the provisions in the current guidelines under which an accountant will not be treated as failing the independence requirement solely by reason of rendering actuarial services by an actuary associated with the accountant or the accountant's firm, or retention or engagement of the accountant or the accountant's firm on a professional basis by the plan sponsor, provided that the specific examples of prohibitions on recognition of independence in the updated IB are not violated. As with the 1975 IB, the updated IB provides as a general principle that in determining whether an accountant or accounting firm is not, in fact, independent with respect to a particular plan, the Department will give appropriate consideration to all relevant circumstances, including evidence bearing on all relationships between the accountant or accounting firm and that of the plan sponsor or any affiliate thereof. The IB also continues the caution from the 1975 IB that multiple services arrangements may involve prohibited transactions under ERISA, and notes the requirements to comply with conditions in prohibited transaction exemptions, such as the prohibited transaction exemption in ERISA section 408(b)(2) for ERISA section 406(a)(1)(C) service provider transactions. 18

The 1975 IB defines “member” as “all partners or shareholder employees in the firm and all professional employees participating in the audit or located in an office of the firm participating in a significant portion of the audit.” In the years since the 1975 IB was published, the concept of an “office” for workplace purposes has changed to focus more on workgroups than on physical locations. The Department is persuaded that its definition of “member” would be improved by including a definition of “office” for purposes of determining when an individual is “located in an office” of the firm participating in a significant portion of the audit. In the Department's view, substance should govern the office classification, and the expected regular personnel interactions and assigned reporting channels of an individual may well be more important than an individual's physical location. Accordingly, the updated IB defines the term “office” to mean a reasonably distinct subgroup within a firm, whether constituted by formal organization or informal practice, in which personnel who make up the subgroup generally serve the same group of clients or work on the same categories of matters regardless of the physical location of the individual. This definition of the term “office” is modeled on the definition used in the AICPA independence standard. See AICPA Code of Professional Conduct, 0.400.36 (Effective December 15, 2014, and updated for official releases through August 31, 2016) (available at www.aicpa.org ). See also SEC rules on independence of accountants at 17 CFR 210.2-01(f)(15) (definition of “office”).

For the reasons set forth in the preamble, the Department is amending part 2509 of title 29 of the Code of Federal Regulations as follows:

This document and additional information concerning OFAC are available on OFAC's website: www.treas.gov/ofac.

On December 31, 2015, OFAC issued the Cyber-Related Sanctions Regulations, 31 CFR part 578 (80 FR 81752, December 31, 2015) (the “Regulations”) to implement Executive Order (E.O.) 13694 of April 1, 2015, “Blocking the Property of Certain Persons Engaging in Significant Malicious Cyber-Enabled Activities” (80 FR 18077, April 2, 2015), pursuant to authorities delegated to the Secretary of the Treasury in E.O. 13694. The Regulations were initially issued in abbreviated form for the purpose of providing immediate guidance to the public. OFAC is revising the Regulations to further implement E.O. 13694, as amended by E.O. 13757 of December 28, 2016, “Taking Additional Steps to Address the National Emergency With Respect to Significant Malicious Cyber-Enabled Activities” (82 FR 1, January 3, 2017), as well as certain provisions of title II of the Countering America's Adversaries Through Sanctions Act (Pub. L. 115-44, 131 Stat. 886 (codified in scattered sections of 22 U.S.C.)) (CAATSA). OFAC is amending and reissuing the Regulations as a more comprehensive set of regulations that includes additional interpretive guidance and definitions, general licenses, and other regulatory provisions that will provide further guidance to the public. Due to the number of regulatory sections being updated or added, OFAC is reissuing the Regulations in their entirety.

On April 1, 2015, the President, invoking the authority of, inter alia, the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq. ) (IEEPA), issued E.O. 13694. In E.O. 13694, the President determined that the increasing prevalence and severity of malicious cyber-enabled activities originating from, or directed by persons located, in whole or in substantial part, outside the United States constitute an unusual and extraordinary threat to the national security, foreign policy, and economy of the United States, and declared a national emergency to deal with that threat.

On December 28, 2016, the President issued E.O. 13757 to take additional steps to deal with the national emergency with respect to significant malicious cyber-enabled activities declared in E.O. 13694. E.O. 13757 added an Annex to E.O. 13694 and amended section 1 of E.O. 13694 by replacing section 1(a) in its entirety. New subsection 1(a) of E.O. 13694, as amended by E.O. 13757 (“amended E.O. 13694”), blocks, with certain exceptions, all property and interests in property that are in the United States, that come within the United States, or that are or come within the possession or control of any U.S. person of: (i) the persons listed in the Annex to amended E.O. 13694; (ii) any person determined by the Secretary of the Treasury, in consultation with the Attorney General and the Secretary of State, to be responsible for or complicit in, or to have engaged in, directly or indirectly, cyber-enabled activities originating from, or directed by persons located, in whole or in substantial part, outside the United States that are reasonably likely to result in, or have materially contributed to, a significant threat to the national security, foreign policy, or economic health or financial stability of the United States and that have the purpose or effect of: (A) harming, or otherwise significantly compromising the provision of services by, a computer or network of computers that support one or more entities in a critical infrastructure sector; (B) significantly compromising the provision of services by one or more entities in a critical infrastructure sector; (C) causing a significant disruption to the availability of a computer or network of computers; (D) causing a significant misappropriation of funds or economic resources, trade secrets, personal identifiers, or financial information for commercial or competitive advantage or private financial gain; or (E) tampering with, altering, or causing a misappropriation of information with the purpose or effect of interfering with or undermining election processes or institutions; and (iii) any person determined by the Secretary of the Treasury, in consultation with the Attorney General and the Secretary of State: (A) to be responsible for or complicit in, or to have engaged in, the receipt or use for commercial or competitive advantage or private financial gain, or by a commercial entity, outside the United States of trade secrets misappropriated through cyber-enabled means, knowing they have been misappropriated, where the misappropriation of such trade secrets is reasonably likely to result in, or has materially contributed to, a significant threat to the national security, foreign policy, or economy of the United States; (B) to have materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of, any activity described in subsections (1)(a)(ii) or (iii)(A) of amended E.O. 13694, or any person whose property and interests in property are blocked pursuant to amended E.O. 13694; (C) to be owned or controlled by, or to have acted or purported to act for or on behalf of, directly or indirectly, any person whose property and interests in property are blocked pursuant to amended E.O. 13694; or (D) to have attempted to engage in any of the activities described in subsections (1)(a)(ii) and (iii)(A)-(C) of amended E.O. 13694.

In section 2 of amended E.O. 13694, the President determined that the making of donations of the type of articles specified in section 203(b)(2) of IEEPA (50 U.S.C. 1702(b)(2)) by, to, or for the benefit of any person whose property and interests in property are blocked pursuant to section 1 of amended E.O. 13694 would seriously impair the President's ability to deal with the national emergency declared in amended E.O. 13694. The President therefore prohibited the donation of such items except to the extent provided by statutes, or in regulations, orders, directives, or licenses that may be issued pursuant to amended E.O. 13694.

Section 3 of amended E.O. 13694 provides that the prohibition on any transaction or dealing in blocked property or interests in property includes the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any person whose property and interests in property are blocked pursuant to amended E.O. 13694, and the receipt of any contribution or provision of funds, goods, or services from any such person.

Section 5 of amended E.O. 13694 prohibits any transaction that evades or avoids, has the purpose of evading or avoiding, causes a violation of, or attempts to violate any of the prohibitions set forth in amended E.O. 13694, as well as any conspiracy formed to violate such prohibitions.

Section 8 of amended E.O. 13694 authorizes the Secretary of the Treasury, in consultation with the Attorney General and the Secretary of State, to take such actions, including the promulgation of rules and regulations, and to employ all powers granted to the President by IEEPA, as may be necessary to carry out the purposes of amended E.O. 13694. Section 8 of amended E.O. 13694 also provides that the Secretary of the Treasury may redelegate any of these functions to other officers and agencies of the U.S. Government.

CAATSA, which was signed into law on August 2, 2017, established new sanctions authorities and exceptions, in addition to amending, modifying, or otherwise affecting certain Ukraine-/Russia-related Executive orders and directives, the Ukraine Freedom Support Act of 2014 (22 U.S.C. 8921-8930) (UFSA), and the Support for the Sovereignty, Integrity, Democracy, and Economic Stability of Ukraine Act of 2014 (22 U.S.C. 8901-8910) (SSIDES).

Title II of CAATSA also required the imposition of sanctions with respect to, among others, activities of the Russian Federation that undermine cybersecurity and persons who knowingly provide financial services in support of activities that undermine cybersecurity. Section 224(a)(1) of CAATSA requires the President, on or after 60 days after the enactment of CAATSA, to block all property and interests in property that are in the United States, that come within the United States, or that are or come within the possession or control of any U.S. person of any person that the President determines: (A) knowingly engages in significant activities undermining cybersecurity against any person, including a democratic institution, or government on behalf of the Government of the Russian Federation; or (B) is owned or controlled by, or acts or purports to act for or on behalf of, directly or indirectly, such a person.

Section 224(a)(2) of CAATSA imposes menu-based sanctions described in section 235 of CAATSA with respect to any person that the President determines knowingly materially assists, sponsors, or provides financial, material, or technological support for, or goods or services (except financial services) in support of, significant activities undermining cybersecurity against any person, including a democratic institution, or government on behalf of the Government of the Russian Federation. Section 228 of CAATSA added section 10 to SSIDES, which requires the imposition of sanctions on, among others, foreign persons that the President determines, on or after August 2, 2017, knowingly materially violate, attempt to violate, conspire to violate, or cause a violation of any license, order, regulation, or prohibition contained in or issued pursuant to E.O. 13694, relating to the Russian Federation, or E.O. 13757, relating to the Russian Federation.

OFAC is incorporating the prohibitions in section 224(a)(1) of CAATSA, as well as the exceptions listed in section 236 of CAATSA, into the Regulations. OFAC has already implemented section 10 of SSIDES, as amended by section 228 of CAATSA, in 31 CFR part 589. OFAC anticipates incorporating the menu-based provisions of section 224(a)(2) of CAATSA into 31 CFR chapter V at a later date.

In furtherance of the purposes of amended E.O. 13694, E.O. 13757, and the provisions of CAATSA described above, OFAC is reissuing the Regulations. The Regulations implement targeted sanctions that are directed at persons determined to meet the criteria set forth in § 578.201 of the Regulations, as well as sanctions that may be set forth in any future Executive orders issued pursuant to the national emergency declared in E.O. 13694. The sanctions in amended E.O. 13694 and CAATSA apply where the transaction or service in question involves property or interests in property that are blocked pursuant to these sanctions.

Subpart A of the Regulations clarifies the relation of this part to other laws and regulations. Subpart B of the Regulations implements the prohibitions contained in sections 1 and 2 of amended E.O. 13694, as well as the prohibitions contained in any further Executive orders issued pursuant to the national emergency declared in E.O. 13694. See, e.g., §§ 578.201 and 578.205. Persons identified in the Annex to amended E.O. 13694, designated by or under the authority of the Secretary of the Treasury pursuant to amended E.O. 13694, or otherwise subject to the blocking provisions of amended E.O. 13694, or the blocking provisions of section 224 of CAATSA, as well as persons who are blocked pursuant to any further Executive orders issued pursuant to the national emergency declared in E.O. 13694, are referred to throughout the Regulations as “persons whose property and interests in property are blocked pursuant to § 578.201.” The names of such persons are published on OFAC's Specially Designated Nationals and Blocked Persons List (SDN List), which is accessible via OFAC's website. Those names also are published in the Federal Register as they are added to the SDN List.

Sections 578.202 and 578.203 of subpart B detail the effect of transfers of blocked property in violation of the Regulations and set forth the requirement to hold blocked funds, such as currency, bank deposits, or liquidated financial obligations, in interest-bearing blocked accounts. Section 578.204 of subpart B provides that all expenses incident to the maintenance of blocked tangible property shall be the responsibility of the owners and operators of such property, and that such expenses shall not be met from blocked funds, unless otherwise authorized. The section further provides that blocked property may, in OFAC's discretion, be sold or liquidated and the net proceeds placed in a blocked interest-bearing account in the name of the owner of the property.

Section 578.205 of subpart B prohibits any transaction that evades or avoids, has the purpose of evading or avoiding, causes a violation of, or attempts to violate any of the prohibitions set forth in § 578.201 of the Regulations, and any conspiracy formed to violate such prohibitions. Section 578.206 of subpart B details transactions that are exempt from the prohibitions of the Regulations pursuant to section 203(b)(1) of IEEPA (50 U.S.C. 1702(b)(1)), which relates to personal communications; section 236 of CAATSA (22 U.S.C. 9530), which relates to U.S. intelligence activities; and section 237 of CAATSA (22 U.S.C. 9531), which relates to activities of the National Aeronautics and Space Administration.

In subpart C of the Regulations, new definitions are being added to other key terms used throughout the Regulations. Because these new definitions were inserted in alphabetical order, the definitions that were in the prior abbreviated set of regulations have been renumbered. Subpart D contains interpretive sections regarding the Regulations. OFAC is redesignating the interpretive on setoffs previously at § 578.405 as § 578.410. New § 578.405 explains that the prohibition on transactions with blocked persons in § 578.201 applies to services performed by U.S. persons on behalf of a person whose property and interests in property are blocked pursuant to § 578.201, as well as to services received by U.S. persons where the service is performed by, or at the direction of, a person whose property and interests in property are blocked pursuant to § 578.201. OFAC is redesignating the section previously at § 578.406, regarding entities owned by persons whose property and interests in property are blocked, as § 578.411. New § 578.411 explains that the property and interests in property of an entity are blocked if the entity is directly or indirectly owned, whether individually or in the aggregate, 50 percent or more by one or more persons whose property and interests in property are blocked, whether or not the entity itself is incorporated into OFAC's SDN List. New § 578.406 discusses offshore transactions. New §§ 578.407, 578.408, and 578.409 discuss payments from blocked accounts to satisfy obligations, charitable contributions, and credit extended by financial institutions to a person whose property and interests in property are blocked, respectively.

Transactions otherwise prohibited by the Regulations but found to be consistent with U.S. policy may be authorized by one of the general licenses contained in subpart E of the Regulations or by a specific license issued pursuant to the procedures described in subpart E of 31 CFR part 501. OFAC is redesignating the authorization for the provision of certain legal services previously in § 578.506 as § 578.507, redesignating the authorization for payments for legal services from funds originating outside the United States previously in § 578.507 as § 578.508, and redesignating the authorization for emergency medical services previously in § 578.508 as § 578.509. OFAC is adding three new general licenses to the Regulations: a general license authorizing the investment and reinvestment of certain funds in new § 578.506, a general license authorizing the official business of the U.S. government in § 578.510, and a general license authorizing certain official business of international entities and organizations in § 578.511. General licenses and statements of licensing policy relating to this part also may be available through the Sanctions Related to Significant Malicious Cyber-Enabled Activities page on OFAC's website: www.treas.gov/ofac.

Subpart F of the Regulations refers to subpart C of part 501 for recordkeeping and reporting requirements. Subpart G of the Regulations describes the civil and criminal penalties applicable to violations of the Regulations, as well as the procedures governing the potential imposition of a civil monetary penalty or issuance of a Finding of Violation. Subpart G also refers to appendix A of part 501 for a more complete description of these procedures.

Subpart H of the Regulations refers to subpart E of part 501 for applicable provisions relating to administrative procedures and contains a delegation of certain authorities of the Secretary of the Treasury. Subpart I of the Regulations sets forth a Paperwork Reduction Act notice.

Because the Regulations involve a foreign affairs function, the provisions of E.O. 12866 of September 30, 1993, “Regulatory Planning and Review” (58 FR 51735, October 4, 1993), and the Administrative Procedure Act (5 U.S.C. 553) requiring notice of proposed rulemaking, opportunity for public participation, and delay in effective date are inapplicable. Because no notice of proposed rulemaking is required for this rule, the Regulatory Flexibility Act (5 U.S.C. 601-612) does not apply.

The collections of information related to the Regulations are contained in 31 CFR part 501 (the “Reporting, Procedures and Penalties Regulations”). Pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3507), those collections of information have been approved by the Office of Management and Budget under control number 1505-0164. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid control number.

Section 303 of the Coast Guard and Maritime Transportation Act of 2004, 1 “Inland Navigation Rules Promulgation Authority,” authorizes the Secretary of the Department in which the Coast Guard is operating to issue inland navigation regulations and technical annexes for all vessels on the inland waters of the United States. The goal of such regulations is to be as consistent as possible with the corresponding International Regulations. The Secretary delegated this authority to the Coast Guard in Department of Homeland Security (DHS) Delegation 00170.1, Revision No. 01.2, paragraph (II)(92). The purpose of this interim rule is to correct an error in Title 33 of the Code of Federal Regulations (CFR) part 83, specifically in paragraph (a) of § 83.01, about the preemptive effect of the navigation regulations upon State or local regulation.

The Coast Guard is issuing this rule without prior public notice and opportunity to comment, based on two findings under the “good cause” provision of the Administrative Procedure Act (APA). The APA's notice and comment requirements do not apply when the agency, for good cause, finds that the notice and comment process is “impracticable, unnecessary, or contrary to the public interest.”  2 Here, prior notice and comment are unnecessary and contrary to the public interest because the Coast Guard is resolving an error it introduced to the Inland Navigation Rules (hereafter “Inland Rules”) through a 2014 amendment. As explained below, the language being removed is an incorrect statement regarding the preemptive effect of regulations.

The Coast Guard cannot leave the incorrect preemption statement in place, so public comment on it, or on its removal, is unnecessary. The statement was made in error. Leaving it in place could be seen as leaving the public without the protection of any meaningful enforcement of state and local navigation safety laws. No replacement language is being inserted, and no entity's rights are harmed by the removal. The rule requires no action by either the States or the public.

Further, giving the public prior notice of the correction is contrary to the public interest and could even cause harm. As written, the incorrect language purports to prevent States from adopting their own navigational safety regulations. The insertion of this incorrect language in 2014 had no impact, however, on day-to-day enforcement by States. State law enforcement units conduct nearly all the enforcement of navigation rules on inland waterways. An announcement in the Federal Register that States cannot do so would undermine the legitimacy of safety enforcement in the time between the notice of proposed rulemaking (NPRM) and the final rule. Violations of State and local navigation rules, such as excessive speed and failing to maintain a proper lookout, comprise four of the top five causal factors in recreational boating accidents. 3 Publishing an NPRM, which could create the impression that State marine patrols lack the authority to enforce State and local navigational safety laws, would undermine their purpose and could reduce safety on inland waters.

Therefore, the Coast Guard also finds good cause under Title 5 of the United States Code (U.S.C.) Section 553(d) to make this interim rule effective immediately on publication. In situations where prior comment is contrary to the public interest, the Coast Guard's practice is to provide a comment period after issuing the rule if doing so will not interfere with the purpose and execution of that rule. We are providing a 90-day period for public comment and will consider all comments received during that time.

The Inland Rules are a special body of rules defined by the International Regulations for Prevention of Collisions at Sea, 1972, often referred to as “COLREGS” or “International Rules.” The President proclaimed the International Rules as United States law in accordance with the International Navigational Rules Act of 1977. 4 Congress subsequently set about harmonizing the inland navigation rules that remained in use within the United States, including the Western Rivers Rules, Great Lakes Rules, the old Inland Rules, and parts of the Motorboat Act of 1940. These efforts culminated in the Inland Navigational Rules Act of 1980, which codified Rules 1 through 38, considered the main body of the Inland Rules. 5

Neither the International Navigational Rules Act of 1977 nor the Inland Navigational Rules Act of 1980 contained express language regarding the preemption of State law. A 2009 Sea Tow study (available in the docket where indicated under the ADDRESSES portion of the preamble) found that “each State and Territory has its own version of navigation rules recorded in different locations in State law.” The study further found that 37 of the 56 States and Territories had either adopted the International Rules or Inland Rules, or enacted laws requiring conformity with them. In April 2010, in accordance with Congressional authorization, the Coast Guard issued regulations effectively transferring the Inland Rules from United States Code to the Code of Federal Regulations. 6 The 2010 rule made no specific statements about the preemptive effect of the Inland Rules. The section of the preamble that discussed federalism said that there were no implications for federalism under Executive Order 13132, which addresses preemption.

In 2012, the Coast Guard proposed routine amendments to the Inland Rules to retain consistency with COLREGS amendments approved by the International Maritime Organization. 7 At that time, the Coast Guard proposed to add a statement of preemptive effect to 33 CFR 83.01(a) in accordance with a 2009 Presidential memorandum regarding preemption. 8 A commenter asked the Coast Guard to clarify that the proposed preemption language referred to field preemption rather than conflict preemption, and in the 2014 final rule, the Coast Guard said that it did. 9 This erroneous statement has recently led to questions about whether State and local governments may regulate navigation on State waters where the Inland Navigation Rules apply. Some State agencies use State statutes to enforce violations outside the scope of the Inland Navigation Rules. These include prohibitions on negligent operations. Others have continued to patrol and enforce State boating violations under State navigation rules.

The Coast Guard will enforce the limited access area for the annual San Francisco Bay Navy Fleet Week Parade of Ships and Blue Angels Demonstration in 33 CFR 100.1105.

The regulated area “Alpha” in § 100.1105(b)(1) for the Navy Parade of Ships will be enforced from 9:30 a.m. until 12 p.m. on October 7, 2022. The regulated area “Bravo” in § 100.1105(b)(2) for the U.S. Navy Blue Angels will be enforced from 1:30 p.m. until 7 p.m. on October 6, 2022, and 11:30 a.m. until 5 p.m. daily from October 7, 2022 through October 9, 2022.

Regulated area “Alpha” will be enforced during the Navy Parade of Ships and is bounded by a line connecting the following points and thence along the shore to the point of beginning:

Under the provisions of 33 CFR 100.1105, except for persons or vessels authorized by the PATCOM, in regulated area “Alpha” no person or vessel may enter the parade route or remain within 500 yards of any Navy parade vessel. No person or vessel shall anchor, block, loiter in, or impede the through transit of ship parade participants or official patrol vessels in regulated area “Alpha.”

Regulated area “Bravo” will be enforced during the Navy Blue Angels Demonstration and is bounded by a line connecting the following points and thence along the pierheads and bulwarks to the point of beginning:

Except for persons or vessels authorized by the PATCOM, no person or vessel may enter or remain within regulated area “Bravo.”

When hailed or signaled by U.S. Coast Guard patrol personnel by siren, radio, flashing light, or other means, a person or vessel shall come to an immediate stop. Persons or vessels shall comply with all directions given; failure to do so may result in expulsion from the area, citation for failure to comply, or both. The Coast Guard may be assisted by other Federal, State, or local law enforcement agencies in enforcing this regulation.

The PATCOM shall be designated by the Commander, Coast Guard Sector San Francisco, California. The PATCOM is empowered to forbid and control the movement of all vessels in the regulated areas.

In addition to this notification of enforcement in the Federal Register , the Coast Guard plans to provide notification of this enforcement period via the Local Notice to Mariners.

The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are impracticable and contrary to the public interest. Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule. It would be impracticable and contrary to the public interest to publish an NPRM becasue we must take immediate action to establish this safety zone by September 10, 2022, to respond to potential safety hazards associated with the fireworks display. Potential safety hazards include the accidental discharge of fireworks, dangerous projectiles, and falling hot embers or other debris. Event sponsors did not notify the Coast Guard of the event until August 2, 2022.

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

The Coast Guard is issuing this rule under authority in 46 U.S.C. 70034 (previously 33 U.S.C. 1231). The Captain of the Port, Maryland-National Capital Region (COTP) has determined that potential hazards associated with the fireworks to be used in this September 10, 2022, display will be a safety concern for anyone near these fireworks discharge sites. This rule is needed to protect personnel, vessels, and the marine environment in the navigable waters within the safety zone before, during, and after the scheduled event.

This rule establishes a safety zone from 8 p.m. on September 10, 2022, until 11 p.m. on September 11, 2022. The zone will be enforced from 8 p.m. to 11 p.m. on September 10, 2022, or, if necessary due to inclement weather on September 10, 2022, from 8 p.m. to 11 p.m. on September 11, 2022. The safety zone will cover all navigable waters within 600 feet of a barge in the Susquehanna River located in approximate position latitude 39°32′19.0″ N, longitude 076°04′58.3″ W, at Havre de Grace, MD. The duration of the zone is intended to ensure safety of vessels and these navigable waters before, during, and after the scheduled 9 p.m. to 10 p.m. fireworks display. No vessel or person will be permitted to enter the safety zone without obtaining permission from the COTP or a designated representative.

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

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

This regulatory action determination is based on size, duration and time-of-day of the safety zone, which will impact a small designated area of the Susquehanna River for a total of no more than one hour of total enforcement-hours during the evening when vessel traffic is normally low. Moreover, the Coast Guard will issue Local Notice to Mariners and a Broadcast Notice to Mariners via VHF-FM marine channel 16 about the safety zone.

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

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

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

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

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

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

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

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

We have analyzed this rule under Department of Homeland Security Directive 023-01, Rev. 1, associated implementing instructions, and Environmental Planning COMDTINST 5090.1 (series), which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves a safety zone lasting only 2.5 hours that will prohibit entry within 600 feet of a barge within a portion of the Susquehanna River. It is categorically excluded from further review under paragraph L60(a) of Appendix A, Table 1 of DHS Instruction Manual 023-01-001-01, Rev. 1. A Record of Environmental Consideration supporting this determination is available in the docket. For instructions on locating the docket, see the ADDRESSES section of this preamble.

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

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

The Coast Guard will enforce the safety zone in 33 CFR 165.1198 for the Military Ocean Terminal Concord, CA (MOTCO) regulated area from 12:01 a.m. on September 5, 2022, until 11:59 p.m. on September 8, 2022, or as announced via marine local broadcasts. This safety zone is necessary to protect personnel, vessels, and the marine environment from potential explosion within the explosive arc. The regulation for this safety zone, § 165.1198, specifies the location of the safety zone which encompasses the navigable waters in the area between 500 yards of MOTCO Pier 2 in position 38°03′30″ N, 122°01′14″ W and 3,000 yards of the pier. During the enforcement periods, as reflected in § 165.1198(d), if you are the operator of a vessel in the regulated area you must comply with the instructions of the COTP or the designated on-scene patrol personnel. Vessel operators desiring to anchor or otherwise loiter within the safety zone must contact Sector San Francisco Vessel Traffic Service at 415-556-2760 or VHF Channel 14 to obtain permission.

In addition to this notification of enforcement in the Federal Register , the Coast Guard plans to provide notification of this enforcement period via marine information broadcasts.

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

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

You may access a frequently updated electronic version of 40 CFR part 180 through the Office of the Federal Register's e-CFR site at https://www.ecfr.gov/current/title-40.

Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2021-0183 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing and must be received by the Hearing Clerk on or before November 7, 2022. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2021-0183, by one of the following methods.

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

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

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

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

In the Federal Register of July 20, 2022 (87 FR 43231) (FRL-9410-03-OCSPP), EPA issued a document pursuant to FFDCA section 408, 21 U.S.C. 346a, announcing the receipt of a pesticide petition (PP IN-11470) filed by Croda, Inc., 300-A Columbus Circle Edison, NJ 08837. The petition requested to amend the existing exemption from the requirement of a tolerance for residues of styrene, copolymers with acrylic acid and/or methacrylic acid under 40 CFR 180.960 by adding poly(oxy-1,2-ethanediyl), α-(2-methyl-1-oxo-2-propenyl)-ω- methoxy- (CAS Reg. No. 26915-72-0) to the descriptor. That document included a summary of the petition prepared by the petitioner and solicited comments on the petitioner's request. The Agency did not receive any comments.

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

EPA establishes exemptions from the requirement of a tolerance only in those cases where it can be shown that the risks from aggregate exposure to pesticide chemical residues under reasonably foreseeable circumstances will pose no appreciable risks to human health. In order to determine the risks from aggregate exposure to pesticide inert ingredients, the Agency considers the toxicity of the inert in conjunction with possible exposure to residues of the inert ingredient through food, drinking water, and through other exposures that occur as a result of pesticide use in residential settings. If EPA is able to determine that a finite tolerance is not necessary to ensure that there is a reasonable certainty that no harm will result from aggregate exposure to the inert ingredient, an exemption from the requirement of a tolerance may be established.

Consistent with FFDCA section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action and considered its validity, completeness and reliability and the relationship of this information to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. In the case of certain chemical substances that are defined as polymers, the Agency has established a set of criteria to identify categories of polymers expected to present minimal or no risk. The definition of a polymer is given in 40 CFR 723.250(b) and the exclusion criteria for identifying these low-risk polymers are described in 40 CFR 723.250(d). Styrene, copolymers with acrylic acid and/or methacrylic acid, with none and/or one or more of the following monomers or polymers: acrylamidopropyl methyl sulfonic acid, methallyl sulfonic acid, 3-sulfopropyl acrylate, 3-sulfopropyl methacrylate, hydroxypropyl methacrylate, hydroxypropyl acrylate, hydroxyethyl methacrylate, hydroxyethyl acrylate, lauryl methacrylate and/or poly(oxy-1,2-ethanediyl), α-(2-methyl-1-oxo-2-propenyl)-ω-methoxy-; and its sodium, potassium, ammonium, monoethanolamine, and triethanolamine salts conforms to the definition of a polymer given in 40 CFR 723.250(b) and meets the following criteria that are used to identify low-risk polymers.

1. The polymer is not a cationic polymer nor is it reasonably anticipated to become a cationic polymer in a natural aquatic environment.

2. The polymer does contain as an integral part of its composition at least two of the atomic elements carbon, hydrogen, nitrogen, oxygen, silicon, and sulfur.

3. The polymer does not contain as an integral part of its composition, except as impurities, any element other than those listed in 40 CFR 723.250(d)(2)(ii).

4. The polymer is neither designed nor can it be reasonably anticipated to substantially degrade, decompose, or depolymerize. A determination of biodegradability by manometric respiration test (OECD 301F; MRID 51718701) was provided and reviewed by EPA on a surrogate polymer, which was found to not readily biodegrade.

5. The polymer is manufactured or imported from monomers and/or reactants that are already included on the TSCA Chemical Substance Inventory or manufactured under an applicable TSCA section 5 exemption.

6. The polymer is not a water absorbing polymer with a number average molecular weight (MW) greater than or equal to 10,000 Daltons.

7. The polymer does not contain certain perfluoroalkyl moieties consisting of a CF3- or longer chain length as listed in 40 CFR 723.250(d)(6)

Additionally, the polymer also meets as required the following exemption criteria specified in 40 CFR 723.250(e):

The polymer's number average MW of 1200 is greater than 1,000 and less than 10,000 daltons. The polymer contains less than 10% oligomeric material below MW 500 and less than 25% oligomeric material below MW 1,000, and the polymer does not contain any reactive functional groups.

Thus, styrene, copolymers with acrylic acid and/or methacrylic acid, with none and/or one or more of the following monomers or polymers: acrylamidopropyl methyl sulfonic acid, methallyl sulfonic acid, 3-sulfopropyl acrylate, 3-sulfopropyl methacrylate, hydroxypropyl methacrylate, hydroxypropyl acrylate, hydroxyethyl methacrylate, hydroxyethyl acrylate, lauryl methacrylate and/or poly(oxy-1,2-ethanediyl), α-(2-methyl-1-oxo-2-propenyl)-ω-methoxy-; and its sodium, potassium, ammonium, monoethanolamine, and triethanolamine salts meets the criteria for a polymer to be considered low risk under 40 CFR 723.250. Based on its conformance to the criteria in this unit, no mammalian toxicity is anticipated from dietary, inhalation, or dermal exposure to styrene, copolymers with acrylic acid and/or methacrylic acid, with none and/or one or more of the following monomers or polymers: acrylamidopropyl methyl sulfonic acid, methallyl sulfonic acid, 3-sulfopropyl acrylate, 3-sulfopropyl methacrylate, hydroxypropyl methacrylate, hydroxypropyl acrylate, hydroxyethyl methacrylate, hydroxyethyl acrylate, lauryl methacrylate and/or poly(oxy-1,2-ethanediyl), α-(2-methyl-1-oxo-2-propenyl)-ω-methoxy-; and its sodium, potassium, ammonium, monoethanolamine, and triethanolamine salts.

For the purposes of assessing potential exposure under this exemption, EPA considered that styrene, copolymers with acrylic acid and/or methacrylic acid, with none and/or one or more of the following monomers or polymers: acrylamidopropyl methyl sulfonic acid, methallyl sulfonic acid, 3-sulfopropyl acrylate, 3-sulfopropyl methacrylate, hydroxypropyl methacrylate, hydroxypropyl acrylate, hydroxyethyl methacrylate, hydroxyethyl acrylate, lauryl methacrylate and/or poly(oxy-1,2-ethanediyl), α-(2-methyl-1-oxo-2-propenyl)-ω-methoxy-; and its sodium, potassium, ammonium, monoethanolamine, and triethanolamine salts; the resulting polymer having a minimum number average molecular weight (in amu), 1200 could be present in all raw and processed agricultural commodities and drinking water, and that non-occupational non-dietary exposure was possible. The number average MW of styrene, copolymers with acrylic acid and/or methacrylic acid, with none and/or one or more of the following monomers or polymers: acrylamidopropyl methyl sulfonic acid, methallyl sulfonic acid, 3-sulfopropyl acrylate, 3-sulfopropyl methacrylate, hydroxypropyl methacrylate, hydroxypropyl acrylate, hydroxyethyl methacrylate, hydroxyethyl acrylate, lauryl methacrylate and/or poly(oxy-1,2-ethanediyl), α-(2-methyl-1-oxo-2-propenyl)-ω-methoxy-; and its sodium, potassium, ammonium, monoethanolamine, and triethanolamine salts is 1200 daltons. Generally, a polymer of this size would be poorly absorbed through the intact gastrointestinal tract or through intact human skin. Since styrene, copolymers with acrylic acid and/or methacrylic acid, with none and/or one or more of the following monomers or polymers: acrylamidopropyl methyl sulfonic acid, methallyl sulfonic acid, 3-sulfopropyl acrylate, 3-sulfopropyl methacrylate, hydroxypropyl methacrylate, hydroxypropyl acrylate, hydroxyethyl methacrylate, hydroxyethyl acrylate, lauryl methacrylate and/or poly(oxy-1,2-ethanediyl), α-(2-methyl-1-oxo-2-propenyl)-ω-methoxy-; and its sodium, potassium, ammonium, monoethanolamine, and triethanolamine salts conform to the criteria that identify a low-risk polymer, there are no concerns for risks associated with any potential exposure scenarios that are reasonably foreseeable. The Agency has determined that a tolerance is not necessary to protect the public health.

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

EPA has not found styrene, copolymers with acrylic acid and/or methacrylic acid, with none and/or one or more of the following monomers or polymers: acrylamidopropyl methyl sulfonic acid, methallyl sulfonic acid, 3-sulfopropyl acrylate, 3-sulfopropyl methacrylate, hydroxypropyl methacrylate, hydroxypropyl acrylate, hydroxyethyl methacrylate, hydroxyethyl acrylate, lauryl methacrylate and/or poly(oxy-1,2-ethanediyl), α-(2-methyl-1-oxo-2-propenyl)-ω-methoxy-; and its sodium, potassium, ammonium, monoethanolamine, and triethanolamine salts to share a common mechanism of toxicity with any other substances, and styrene, copolymers with acrylic acid and/or methacrylic acid, with none and/or one or more of the following monomers or polymers: acrylamidopropyl methyl sulfonic acid, methallyl sulfonic acid, 3-sulfopropyl acrylate, 3-sulfopropyl methacrylate, hydroxypropyl methacrylate, hydroxypropyl acrylate, hydroxyethyl methacrylate, hydroxyethyl acrylate, lauryl methacrylate and/or poly(oxy-1,2-ethanediyl), α-(2-methyl-1-oxo-2-propenyl)-ω-methoxy-; and its sodium, potassium, ammonium, monoethanolamine, and triethanolamine salts does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that styrene, copolymers with acrylic acid and/or methacrylic acid, with none and/or one or more of the following monomers or polymers: acrylamidopropyl methyl sulfonic acid, methallyl sulfonic acid, 3-sulfopropyl acrylate, 3-sulfopropyl methacrylate, hydroxypropyl methacrylate, hydroxypropyl acrylate, hydroxyethyl methacrylate, hydroxyethyl acrylate, lauryl methacrylate and/or poly(oxy-1,2-ethanediyl), α-(2-methyl-1-oxo-2-propenyl)-ω-methoxy-; and its sodium, potassium, ammonium, monoethanolamine, and triethanolamine salts does not have a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see EPA's website at https://www.epa.gov/pesticides/cumulative.

Section 408(b)(2)(C) of FFDCA provides that EPA shall apply an additional tenfold margin of safety for infants and children in the case of threshold effects to account for prenatal and postnatal toxicity and the completeness of the data base unless EPA concludes that a different margin of safety will be safe for infants and children. Due to the expected low toxicity of styrene, copolymers with acrylic acid and/or methacrylic acid, with none and/or one or more of the following monomers or polymers: acrylamidopropyl methyl sulfonic acid, methallyl sulfonic acid, 3-sulfopropyl acrylate, 3-sulfopropyl methacrylate, hydroxypropyl methacrylate, hydroxypropyl acrylate, hydroxyethyl methacrylate, hydroxyethyl acrylate, lauryl methacrylate and/or poly(oxy-1,2-ethanediyl), α-(2-methyl-1-oxo-2-propenyl)-ω-methoxy-; and its sodium, potassium, ammonium, monoethanolamine, and triethanolamine salts, EPA has not used a safety factor analysis to assess the risk. For the same reasons the additional tenfold safety factor is unnecessary.

Based on the conformance to the criteria used to identify a low-risk polymer, EPA concludes that there is a reasonable certainty of no harm to the U.S. population, including infants and children, from aggregate exposure to residues of styrene, copolymers with acrylic acid and/or methacrylic acid, with none and/or one or more of the following monomers or polymers: acrylamidopropyl methyl sulfonic acid, methallyl sulfonic acid, 3-sulfopropyl acrylate, 3-sulfopropyl methacrylate, hydroxypropyl methacrylate, hydroxypropyl acrylate, hydroxyethyl methacrylate, hydroxyethyl acrylate, lauryl methacrylate and/or poly(oxy-1,2-ethanediyl), α-(2-methyl-1-oxo-2-propenyl)-ω-methoxy-; and its sodium, potassium, ammonium, monoethanolamine, and triethanolamine salts.

An analytical method is not required for enforcement purposes since the Agency is establishing an exemption from the requirement of a tolerance without any numerical limitation.

Accordingly, EPA finds that exempting residues of styrene, copolymers with acrylic acid and/or methacrylic acid, with none and/or one or more of the following monomers or polymers: acrylamidopropyl methyl sulfonic acid, methallyl sulfonic acid, 3-sulfopropyl acrylate, 3-sulfopropyl methacrylate, hydroxypropyl methacrylate, hydroxypropyl acrylate, hydroxyethyl methacrylate, hydroxyethyl acrylate, lauryl methacrylate and/or poly(oxy-1,2-ethanediyl), α-(2-methyl-1-oxo-2-propenyl)-ω-methoxy-; and its sodium, potassium, ammonium, monoethanolamine, and triethanolamine salts; the resulting polymer having a minimum number average molecular weight (in amu), 1200 from the requirement of a tolerance will be safe.

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

Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq. ), do not apply.

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

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

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

Therefore, for the reasons stated in the preamble, EPA is amending 40 CFR chapter I as follows:

The EPA is publishing this action without a prior proposed rule because we view this as a noncontroversial action and anticipate no adverse comment. This action is a routine program change. However, in the “Proposed Rules” section of this issue of the Federal Register , we are publishing a separate document that will serve as the proposed rule allowing the public an opportunity to comment. We will not institute a second comment period on this action. Any parties interested in commenting must do so at this time. For further information about commenting on this action, see the ADDRESSES section of this document.

If the EPA receives comments that oppose this authorization, we will withdraw this action by publishing a document in the Federal Register before the action becomes effective. The EPA will base any further decision on the authorization of the state program changes on the proposal mentioned in the previous paragraph. We will then address all public comments in a later final action.

States that have received final authorization from the EPA under RCRA section 3006(b), 42 U.S.C. 6926(b), must maintain a hazardous waste program that is equivalent to, consistent with, and no less stringent than the Federal program. As the Federal program changes, states must change their programs and ask the EPA to authorize the changes. Changes to state programs may be necessary when Federal or state statutory or regulatory authority is modified or when certain other changes occur. Most commonly, states must change their programs because of changes to the EPA's regulations in 40 Code of Federal Regulations (CFR) parts 124, 260 through 268, 270, 273, and 279.

New Federal requirements and prohibitions imposed by Federal regulations that the EPA promulgates pursuant to the Hazardous and Solid Waste Amendments of 1984 (HSWA) take effect in authorized states at the same time they take effect in unauthorized states. Thus, the EPA will implement those requirements and prohibitions in Florida, including the issuance of new permits implementing those requirements, until the State is granted authorization to do so.

Florida submitted a complete program revision application (PRA), dated September 1, 2021, and an amendment to the PRA, dated June 24, 2022, seeking authorization of changes to its hazardous waste program corresponding to certain Federal rules promulgated between July 1, 1987 and June 30, 2020 (including Non-HSWA Cluster  1 IV (Checklist  2 24.1 only), HSWA Cluster II (Checklist 44D only), RCRA Clusters VIII (Checklist 167B only), X (Checklists 182 and 182.1), XI (Checklist 190 only), XV (Checklists 206.1 and 207.1), and XXVIII (Checklist 242). The EPA concludes that Florida's application to revise its authorized program meets all of the statutory and regulatory requirements established under RCRA, as set forth in RCRA section 3006(b), 42 U.S.C. 6926(b), and 40 CFR part 271. Therefore, the EPA grants Florida final authorization to operate its hazardous waste program with the changes described in the authorization application, and as outlined below in Section VI of this document.

Florida has responsibility for permitting treatment, storage, and disposal facilities within its borders (except in Indian country, as defined at 18 U.S.C. 1151) and for carrying out the aspects of the RCRA program described in its program revision application, subject to the limitations of HSWA, as discussed above.

The effect of this decision is that the changes described in Florida's authorization application will become part of the authorized State hazardous waste program and will therefore be federally enforceable. Florida will continue to have primary enforcement authority and responsibility for its State hazardous waste program. The EPA will maintain its authorities under RCRA sections 3007, 3008, 3013, and 7003, including its authority to:

• Conduct inspections, and require monitoring, tests, analyses, and reports;

• Enforce RCRA requirements, including authorized State program requirements, and suspend or revoke permits; and

• Take enforcement actions regardless of whether the State has taken its own actions.

This action does not impose additional requirements on the regulated community because the regulations for which the EPA is authorizing Florida are already effective under State law and are not changed by this action.

Florida initially received final authorization on January 29, 1985, effective February 12, 1985 (50 FR 3908), to implement the RCRA hazardous waste management program. The EPA granted authorization for changes to Florida's program on the following dates: December 1, 1987, effective March 3, 1988 (52 FR 45634); December 16, 1988, effective January 3, 1989 (53 FR 50529); December 14, 1990, effective February 12, 1991 (55 FR 51416); February 5, 1992, effective April 6, 1992 (57 FR 4371); February 7, 1992, effective April 7, 1992 (57 FR 4738); May 20, 1992, effective July 20, 1992 (57 FR 21351); November 9, 1993, effective January 10, 1994 (58 FR 59367); July 11, 1994, effective September 9, 1994 (59 FR 35266); April 16, 1994, effective October 17, 1994 (59 FR 41979); October 26, 1994, effective December 27, 1994 (59 FR 53753); April 1, 1997, effective June 2, 1997 (62 FR 15407); January 20, 1998, effective March 23, 1998 (63 FR 2896); September 18, 2000, effective November 18, 2000 (65 FR 56256); August 23, 2001, effective October 22, 2001 (66 FR 44307); August 20, 2002, effective October 21, 2002 (67 FR 53886 and 67 FR 53889); October 14, 2004, effective December 13, 2004 (69 FR 60964); August 10, 2007, effective October 9, 2007 (72 FR 44973); February 7, 2011, effective April 8, 2011 (76 FR 6564); October 8, 2014, effective December 8, 2014 (79 FR 60756); February 22, 2019 (Proposed), effective May 10, 2019 (84 FR 20549); and February 25, 2020, effective June 1, 2020 (85 FR 33026). The authorized Florida program, through RCRA Cluster IV, was incorporated by reference into the CFR on January 20, 1988, effective March 23, 1998 (63 FR 2896).

Florida submitted a complete program revision application, dated September 1, 2021, and an amendment to the PRA, dated June 24, 2022, seeking authorization of changes to its hazardous waste management program in accordance with 40 CFR 271.21. This application included changes associated with Checklist 242. Additionally, the amendment to the PRA included changes associated with older Checklists 24.1, 44D, 167B, 182, 182.1, 190, 206.1, and 207.1. 3 The EPA has determined, subject to receipt of written comments that oppose this action, that Florida's hazardous waste program revisions are equivalent to, consistent with, and no less stringent than the Federal program, and therefore satisfy all of the requirements necessary to qualify for final authorization. Therefore, the EPA grants final authorization to Florida for the following program changes:

This is a synopsis of the Commission's Third Report and Order in WC Docket No. 21-450; FCC 22-65, adopted on August 5, 2022 and released on August 8, 2022. Due to the COVID-19 pandemic, the Commission's headquarters will be closed to the general public until further notice. The full text of this document is available at the following internet address: https://www.fcc.gov/document/fcc-releases-rules-implement-affordable-connectivity-program.

1. Earlier this year, the Federal Communications Commission (Commission) established the $14.2 billion Affordable Connectivity Program (or ACP). Over 12 million households have signed up to receive a $30 benefit (or up to $75 per month for households on qualifying Tribal lands) to offset the cost of internet access. For those households, the Affordable Connectivity Program can open up a world of opportunity. They can work from home, take advantage of telehealth and remote schooling, and stay connected with friends and family. The Commission is committed to bringing those benefits to the millions more eligible households who have not yet signed up. In this document, the Commission establishes a pilot program, titled “Your Home, Your internet,” designed to increase awareness of and encourage participation in the Affordable Connectivity Program for households receiving Federal housing assistance.

2. When the Commission adopted the final ACP rules in January 2022, it sought comment on a proposal to target outreach and provide application support to residents of public housing and other Federal housing assistance recipients. By establishing this pilot program, the Commission intends to test the best methods to make recipients aware of and to help them enroll in the Affordable Connectivity Program. The Commission will also use the tools and resources provided to it through the Infrastructure Investment and Jobs Act (Infrastructure Act), such as the ability to collaborate with other agencies, including continuing and expanding upon existing collaborations, to help households receiving Federal housing assistance access affordable broadband service.

3. In this document, the Commission first identifies discrete ACP enhancements and improvements to the ACP application process, the effectiveness of which will be tested during the pilot program. Next, the Commission establishes a one-year pilot program, “Your Home, Your internet,” with the goal of increasing awareness of the Affordable Connectivity Program among recipients of Federal housing assistance and facilitating enrollment in the program by providing targeted assistance with completion of the ACP application.

4. Your Home, Your internet will couple targeted outreach with hands-on application assistance. It will test ways to increase ACP participation by recipients of Federal housing assistance who are eligible for the Affordable Connectivity Program but, based on the Commission's experience, may not be aware of or enrolled in the program. The Commission will select up to 20 pilot participants, which may include government entities and third-party organizations serving Federal housing assistance recipients, from across the country. The Commission intends to select pilot participants from a variety of settings, including urban, rural, and Tribal communities. As discussed below, applicants may propose a variety of activities, including the development of new promotional materials, hands-on application assistance, and site-based outreach. Participants will be given the option to access the National Verifier to better assist consumers in applying for ACP benefits. Participants also will be allowed to apply for a grant to fund Your Home, Your internet pilot projects through the Affordable Connectivity Outreach Grant Program that the Commission adopts in a final rule published elsewhere in this issue of the Federal Register . The Commission has allocated up to $5 million of the $100 million designated for outreach in the ACP Order, 87 FR 8346, February 14, 2022, to provide grants to fund Your Home, Your internet pilot projects. The Commission also has allocated up to an additional $5 million to fund its own outreach activities alongside the grant funds and may collaborate with the Department of Housing and Urban Development (HUD) and other Federal agency partners that work directly with Federal housing assistance recipients to increase awareness of and participation in the Affordable Connectivity Program among recipients of Federal housing assistance.

5. The Commission directs the Wireline Competition Bureau (the Bureau) and the Universal Service Administrative Company (USAC) to take several actions that the Commission expects will facilitate more efficient ACP access for Federal housing assistance recipients in general as well as those working with pilot participants to qualify for the Affordable Connectivity Program. To test their effectiveness during the pilot program, the Commission commits, where practicable, to making these enhancements as expeditiously as possible.

6. First, based on the record and specific feedback from HUD staff, the Commission will change its enrollment materials to include more recognizable language to describe Federal Public Housing Assistance (FPHA) eligibility so participants in the Native American affordable housing, public housing, housing choice voucher, and project-based rental assistance (PBRA) programs (PBRA, Section 202, and Section 811) can more easily identify the program in which they participate. Commenters also argue that there is a lack of clear guidance on what is considered to be a qualifying FPHA program. Without further explanation, participants in those programs may mistakenly believe they do not qualify for the Affordable Connectivity Program. Accordingly, the Commission directs the Bureau and USAC to provide explanatory language naming Native American affordable housing, public housing, housing choice vouchers, and project-based rental assistance in the ACP application (including at the point where applicants select the qualifying programs in which they participate), in related USAC materials, and in the materials created by the Commission.

7. Second, the Commission directs the Bureau, the Office of General Counsel (OGC), the Office of Managing Director (OMD), and USAC to expand and swiftly finalize a revised data sharing agreement with HUD that would allow more Federal housing assistance recipients to be automatically approved for the Affordable Connectivity Program through the National Verifier. The National Verifier is designed to ease the qualification process by leveraging connections with state and Federal database connections. The National Verifier is also an important tool for combating waste, fraud, and abuse in the Affordable Connectivity Program by validating consumer identity and, with the use of the National Lifeline Accountability Database (NLAD), identifying duplicate households in the program.

8. The Commission and HUD have an existing computer matching agreement (CMA) and database connection for the automatic eligibility verification of households participating in certain FPHA programs. This existing agreement, which complies with the Computer Matching and Privacy Protection Act of 1988, covers a connection with the HUD Inventory Management System/Public Housing Information Center (IMS/PIC) database. This connection already allows the National Verifier to automatically qualify households that participate in the public housing and housing choice voucher programs for the Affordable Connectivity Program and Lifeline. Consumers whose eligibility is automatically determined by the National Verifier can proceed to enroll in the Affordable Connectivity Program. Consumers that are not able to be verified through an automated database connection will need to provide documentation for manual review.

9. Because the manual review process is more burdensome than automatic eligibility checks—especially for applicants, but also for USAC—the Commission is committed to further minimizing the use of manual review. To that end, Commission staff are already working with HUD staff to explore establishing an additional connection with the Tenant Rental Assistance Certification System (TRACS) database that would allow more Federal housing assistance recipients to qualify automatically. The TRACS database includes tenants receiving rental housing assistance through the PBRA, Section 202, and Section 811 programs and a connection with the TRACS database would allow households receiving assistance through those programs to be automatically verified without undergoing a manual review process. Finalizing that effort will allow more Federal housing assistance recipients to enroll faster and with less assistance, allowing pilot program participants to stretch their resources further and assist more households. Accordingly, the Commission directs the Bureau and USAC to expedite the completion of that process so that pilot program participants will benefit to the greatest extent possible.

10. Third, because manual review will continue to be necessary for some Federal housing assistance recipients, the Commission directs the Bureau and USAC to take steps to expedite the manual review process and to test the effectiveness of these actions during the pilot program. Currently, USAC provides high-level guidance on the requirements for supporting documentation to demonstrate Federal housing assistance eligibility Federal housing assistance households may need to contact their local public housing agency (PHA) or other Federal housing assistance provider ( e.g., for PBRA, Section 202, or Section 811 tenants) for documentation, and those staff may not be aware of the Affordable Connectivity Program at all or what documentation the household will need. The Commission directs the Bureau and USAC to consult with HUD about the types of documentation PHAs and other Federal housing assistance providers typically provide and create a standardized form to be made available to pilot participants for use by an applicant to demonstrate eligibility in a qualifying Federal housing assistance program to streamline and expedite the manual review process in the National Verifier for Federal housing assistance recipients, PHAs, and USAC reviewers.

11. Finally, the Commission directs USAC, with oversight from the Bureau, to designate a direct point of contact at USAC for organizations selected to participate in the Your Home, Your internet Pilot Program to provide additional support when pilot participants are assisting consumers during the application process. This point of contact should be trained on issues related to Federal housing assistance eligibility and prepared to directly assist pilot participants with questions about the ACP application, including any documentation requirements. Contact information for this point of contact shall be made available to pilot participants to test the impact of having a dedicated point of contact for application-related questions regarding the qualification process.

12. Below, the Commission identifies the specifics of the one-year Your Home, Your Internet Pilot Program. The Commission describes eligible entities that may apply to participate, funding for selected projects, activities these organizations may undertake as part of the pilot program, the procedures and criteria the Bureau will use to select the participants, and the metrics the Commission will use when evaluating the program's results.

13. The Commission encourages Federal and non-Federal organizations to apply to participate in the Your Home, Your Internet Pilot Program. Applicants may include Federal agencies and their partners, housing agencies, and entities that provide ACP support for Federal housing assistance recipients, as described further below. The Commission recognizes that challenges large housing agencies face may differ from smaller providers of federally assisted housing and that Tribal, urban, and rural communities may benefit from different approaches. The Commission therefore intends to select pilot participants operating in a variety of settings in order to generate information about what works in different kinds of communities. Congress expressly authorized the Commission to target outreach to eligible households, including, in particular, to recipients of Federal housing assistance. Congress also required the Commission to “collaborate with relevant Federal agencies to ensure that a household that participates in any program that qualifies the household for the Affordable Connectivity Program is provided information about the Program.” The Commission recognizes that Federal housing assistance recipients live in a variety of settings across the country, from single-family homes to large, urban housing developments, and that Federal housing assistance operates through a web of public housing agencies and private landlords. Thus, the decentralized nature of Federal housing assistance requires an “all hands” approach to raising awareness among this group of qualifying households that are served by private and public entities across the country.

14. Federal agency partners. The Commission encourages its Federal agency partners, many of whom have promoted the Affordable Connectivity Program thus far, to singularly or in coordination with other partners submit applications for the pilot program with ideas and proposals designed to ensure that households participating in public housing or receiving Federal housing assistance are provided with information about the Affordable Connectivity Program, including application and enrollment information.

15. Given the overlap between the Affordable Connectivity Program and Federal housing assistance, the Commission has worked closely with HUD in order to raise awareness of the Affordable Connectivity Program among those eligible households. The Commission expects that this relationship will only strengthen further as the collaboration continues. This is consistent with commenters that emphasize the need to continue to collaborate with HUD. The Commission acknowledges, however, that there are Federal agencies beyond HUD that work with households that receive Federal housing assistance. For example, commenters recommend that the Commission collaborates with the National Telecommunications and Information Administration (NTIA) and the Department of Education. The Alaska Federation of Natives (AFN) urges the Commission to reach Tribal households receiving Federal housing assistance by coordinating with the Office of Native American Programs at HUD, the Bureau of Indian Affairs in the Department of the Interior, and the Indian Health Service in the Department of Health and Human Services. The Commission agrees with commenters that continuing to expand its collaboration within HUD and with other Federal agencies, as the Commission is directed to do under the Infrastructure Act, will increase its reach and allow more touchpoints with households receiving Federal housing assistance. The Commission urges interested Federal partners to consider applying to participate in the pilot program and to share their expertise.

16. Non-Federal partners. In addition to Federal agencies, the Commission urges state, local, and Tribal housing agencies and non-profit and community-based organizations working with Federal housing assistance recipients to apply to participate in Your Home, Your internet. Commenters agree. For example, the Chicago Housing Authority argues that empowering local housing agencies and community organizations to help spread awareness of the program builds trust. AFN urges the Commission to leverage the Tribally Designated Housing Entities (TDHE) or the associations representing multiple TDHE, such as the Association of Alaska Housing Authorities, for outreach. Starry states that the Commission should also consider structuring outreach efforts to reach Federal housing assistance recipients who live outside of centrally managed public or affordable housing communities. Additionally, the San Diego Association of Governments (SANDAG) recommends that the Commission collaborate with the San Diego Housing Commission to help connect the 16,000 San Diego area households that receive Federal Section 8 housing choice voucher rental assistance through the San Diego Housing Commission.

17. The Commission agrees with commenters that the relationships that regional, state, local, and Tribal housing agencies and community-based organizations have fostered with the Federal housing assistance recipients whom they support will help the Commission spread awareness of the Affordable Connectivity Program. A common theme in the record is the need to develop trust to ensure low-income consumers know that the Affordable Connectivity Program is a legitimate government program that can help reduce a household's monthly internet bill. The Commission is persuaded that regional, state, local, and Tribal housing agencies and community-based organizations are vital avenues for connecting with Federal housing assistance recipients. Therefore, the Commission similarly encourages such organizations that serve the needs of this target group to submit pilot program proposals designed to help spread awareness of the Affordable Connectivity Program and encourage enrollment during this pilot.

18. To help support this innovative pilot program, the Commission will allocate up to $10 million of the $100 million identified in the ACP Order for ACP outreach to support Your Home, Your Internet participation. Of this $10 million, up to $5 million will be available in the form of grants for use by grant-eligible pilot participants under the Affordable Connectivity Outreach Grant Program and requirements and procedures for applying for such grants will be separately announced. The Commission directs the Consumer and Governmental Affairs Bureau (CGB) to incorporate the parameters for this pilot program into the requirements and procedures for the Affordable Connectivity Outreach Grant Program, as applicable. Additionally, the Commission will target up to an additional $5 million to fund its own outreach efforts, and may coordinate these efforts with HUD and other Federal agency partners.

19. The Commission finds that there likely is substantial need for funding to support the Your Home, Your Internet Pilot Program to increase participation among the households residing in public housing or receiving Federal housing assistance. This funding will support the pilot participants as they seek to reach and connect the households living in approximately 5 million available housing units subsidized by Federal housing assistance. The ACP Order supports such an allocation. It particularly names, among the outreach activities for which that money is dedicated, “immediate outreach activities and a potential outreach grant program.” The Commission found in the ACP Order that “a wide range of outreach is needed to best promote awareness of and increase participating in the Affordable Connectivity Program.” Funding Your Home, Your Internet is also consistent with the statute and Congressional intent because the Infrastructure Act allows “outreach efforts to encourage eligible households to enroll in the Affordable Connectivity Program.”

20. A broad and diverse set of commenters agree that the Commission must include a funding source as part of the pilot program. EducationSuperHighway supports funding to support services to increase enrollment, including translation services, outreach materials, and device support. Similarly, the California Emerging Technology Fund asks the Commission to award grant funding and Los Angeles County supports awarding grants to local governments, including counties, cities, and other entities to develop hyper-local campaigns. Stewards of Affordable Housing for the Future urges the Commission to accompany the applications with designated funding to ensure households can participate in the Affordable Connectivity Program. The National Hispanic Media Coalition asks the Commission to build out grant amounts to adequately cover an organization's capacity to apply and comply with the grant, as well as plan and implement an outreach program.

21. Having established the types of agencies and organizations with which the Commission expects to participate in this pilot, the Commission now turns to the activities that may be undertaken pursuant to the pilot. The Commission encourages applicants to be creative in developing pilot program proposals to connect with eligible but so far unreached households living in public housing or receiving Federal housing assistance. While the Commission identifies potential pilot program activities below, the discussion here is not meant to be an exhaustive list. As discussed below, the Bureau will provide additional guidance in a public notice announcing the application process.

22. Electronic and Downloadable Content. Since the launch of the Emergency Broadband Benefit Program (EBB Program), the Commission and USAC have produced and published electronic and downloadable content for its partners to use to promote the Affordable Connectivity Program and the EBB Program to low-income consumers, including materials in languages other than English. This pilot offers the opportunity to better serve a specific audience: those who receive assistance from Federal housing assistance programs.

23. Commenters also suggest that toolkits and outreach materials specifically tailored to support organizations working with Federal housing assistance recipients would make outreach more effective under this pilot. For example, Microsoft recommends that toolkits be designed to target the staff at the local housing agencies, consumer experts, non-profits, digital navigators, and other outreach partners by providing information and support to those working directly with the Federal housing assistance recipients. Some commenters recommend making such toolkits available in multiple languages, as Federal housing assistance recipients include non-English speakers as well as those for whom English is a second language. The Commission agrees with commenters as to the potential benefits of specialized toolkits for outreach partners focused on Federal housing assistance recipients. Accordingly, the Commission encourages pilot applicants to submit proposals for specialized ACP outreach materials for organizations working with Federal housing assistance recipients. This may include proposals to prepare materials in languages tailored for the communities they serve.

24. Application Assistance. In the ACP Further Notice of Proposed Rulemaking (FNPRM), 87 FR 8385, February 14, 2022, the Commission sought comment on how to best assist Federal housing assistance recipients in accessing or navigating the application process for the Affordable Connectivity Program. Commenters indicate that Federal housing assistance recipients may face difficulty during the ACP application process. Mississippi Center for Justice states that many applicants face application challenges, such as language barriers, preventing eligible households from applying. Mississippi Center for Justice further asserts that the application process requires applicants to submit additional documents and applicants may abandon their Lifeline or EBB applications, which commenters predicted would also occur for ACP applicants. The National Digital Inclusion Alliance (NDIA) explains that the application process can be confusing for many Federal housing assistance recipients, deterring them from applying.

25. In the Lifeline program, applicants are permitted to receive assistance in the application process from trusted third parties. For example, state entities and Tribal partners may request access to the National Verifier to assist applicants who are physically present with completing and submitting an application for the Lifeline program. To gain access to the National Verifier, state or Tribal entity representatives must register in the Representative Accountability Database (RAD) and indicate their assistance when helping consumers submit an application through the National Verifier. Similarly, as with the Lifeline program, in the ACP Order, the Commission directed the Bureau, in coordination with USAC, to conduct a separate one-year ACP Navigator Pilot, granting “trusted, neutral third-party entities such as schools and school districts, or other local or state government entities” access to the National Verifier for the purpose of assisting customers with applying for the Affordable Connectivity Program.

26. The Commission finds support in the record for providing limited access to the National Verifier to application assistants or navigators to help Federal housing assistance recipients navigate the application process for the Affordable Connectivity Program. Commenters state that having individuals assist with applications “would alleviate . . . burdens on the applicants and promote additional engagement with FPHA recipients.” The Chicago Housing Authority argued that allowing access to the National Verifier database would reduce the amount of time it takes to complete the enrollment process to get residents enrolled in the Affordable Connectivity Program. NCTA—The Internet & Television Association (NCTA) supports “the FCC's proposal to encourage partner agencies to gain access to the National Verifier in order to assist federal housing assistance recipients in applying for the Affordable Connectivity Program through the National Verifier.”

27. Based on the record before the Commission and its experience with the Lifeline program, the Commission believes that it will be beneficial to grant access to the National Verifier to neutral, trusted government entities such as state and local housing agencies, Tribally Designated Housing Entities, associations representing multiple Tribally Designated Housing Entities, or other state, regional, and local government entities or their partners for purposes of assisting recipients of Federal housing assistance with completing and submitting an application for the Affordable Connectivity Program, provided that the consumer is physically present with the person providing assistance. Therefore, the Commission encourages pilot applicants to include requests for access to the National Verifier in connection with the Your Home, Your Internet Pilot Program and/or the ACP Navigator Pilot.

28. In addition, some commenters suggested that the Commission allow access to the National Verifier to certain trusted tenant associations and non-profit or community-based organizations. USTelecom comments that the Commission should “partner with federal, state, and local housing authorities, as well as third parties, including national and regional housing advocacy organizations, tenant associations, and other groups that are already working in this space to assist in reaching households in public housing who would benefit from Affordable Connectivity Program participation.” NCTA states that the Commission should collaborate with trusted partners that could assist residents in applying for the Affordable Connectivity Program based on their participation in the Federal housing assistance programs. The Commission agrees with commenters that community organizations are well positioned to provide one-on-one support and in-person guidance about navigating the ACP application in their neighborhoods. Therefore, as discussed below, the Commission will allow access to the National Verifier to a limited number of tenant associations, on-site service coordinators, and non-profit or community-based organizations that already have an established partnership with governmental agencies participating in the pilot. A tenant association, non-profit, or community-based organization may participate in the pilot provided that the government entity it is partnering with submits support of the partnership. Additionally, enrollment activities through the National Verifier must take place in the government entity's facility or other location or setting maintained or operated with support from the government entity. Tenant associations, on-site service coordinators, non-profits, and community-based organizations must have their representatives register in the RAD and indicate their assistance when helping consumers submit an application through the National Verifier. Governmental entities must oversee these organizations to ensure adequate safeguards are in place to prevent any misconduct, waste, fraud, or abuse and that appropriate measures are in place to protect the personally identifiable information of the applicants.

29. Governmental agencies participating in this pilot (and their partners as applicable) must maintain neutrality with respect to ACP participating providers when assisting consumers in connection with this pilot. Those voluntarily participating in this pilot cannot, when assisting applicants, direct consumers to a specific ACP provider's website or otherwise recommend a specific ACP provider. Pilot participants assisting consumers with the application may, however, refer consumers to a list of providers offering ACP service in their area. Those providing application assistance through this pilot are also prohibited from accepting gifts or other incentives from a participating provider that would have the effect of influencing an agency or partner to encourage consumers they are assisting to enroll with a specific provider. Furthermore, pilot participants may not otherwise accept funding in any form, including in-kind contributions, from a participating provider or a specific group of participating providers (including, but not limited to, broadband industry groups such as trade associations) for the purpose of assisting consumers in connection with this pilot. As discussed below, these requirements do not prohibit activities like sign-up events conducted with ACP providers so long as those activities are open to all providers serving the relevant location.

30. Some commenters recommend allowing state, local, and Tribal housing agencies to automatically enroll Federal housing assistance recipients in the Affordable Connectivity Program, stating that Federal housing assistance recipients' eligibility has already been prequalified. The National Verifier application is designed to ease the qualification process by leveraging connections with state and Federal databases. Currently, the National Verifier has a connection with HUD to verify applicants' participation in certain FPHA programs, for which the Commission, USAC and HUD have entered into a Computer Matching Agreement to comply with the Computer Matching and Privacy Protection Act of 1988. The National Verifier is also an important tool in combating waste, fraud, and abuse in the Affordable Connectivity Program by validating consumer identity and, with the use of the NLAD, to identify duplicate households in the program. The Commission declines at this time to modify the qualification and enrollment processes for the Affordable Connectivity Program to allow HUD or housing agencies to “auto-qualify” or bulk enroll households without first requiring a household to submit a National Verifier application. Instead, the application assistance tools the Commission adopts as part of this pilot will build upon the database connections and existing matching agreements related to the National Verifier to further streamline the application process for Federal housing assistance recipients, while at the same time protecting program integrity and consumer choice.

31. To the extent that pilot applicants have proposals for tools to assist in the application process that they may seek to utilize during the pilot, the Commission encourages them to submit proposals incorporating the use of such application assistance tools to test the effectiveness of those tools during the pilot program. One important goal of the Your Home, Your Internet Pilot Program is to identify methods to decrease the amount of time and effort needed to sign up for the Affordable Connectivity Program, while at the same time protecting the integrity of the program. The Commission directs the Bureau, with support from USAC, OMD, and OGC, to explore the feasibility of permitting the use of such application aids during this pilot, and to ensure that the use of such tools is consistent with legal and USAC system requirements and will not invite waste, fraud, and abuse into the Affordable Connectivity Program. In addition to providing National Verifier access to help support the completion of ACP applications, the Commission encourages pilot participants to consider as part of their proposals “train the trainer” events or webinars to educate housing organizations, government agencies, and other authorized partners about the application and enrollment process and to answer their questions about the program.

32. In the ACP FNPRM, the Commission also sought comment on whether the Commission should encourage the entities participating in the pilot program to establish on-site assistance locations where eligible household members can complete applications for the Affordable Connectivity Program. In the ACP FNPRM, the Commission did not define or provide examples of on-site assistance locations; however, examples from the record include properties where Federal housing assistance recipients reside. Commenters agree that those participating in the pilot program should establish on-site assistance locations where Federal housing assistance recipients can complete ACP applications. NDIA states that “FPHA beneficiaries would benefit enormously from an on-site enrollment assistance location where they can complete and submit an ACP application in a one-stop manner.” NDIA further argues that “an on-site assistance location would reduce the application burden on households, build trust, and ultimately increase ACP enrollment amongst FPHA beneficiaries.” Local Initiatives Support Corporation (LISC) asserts that it is essential to consider partnerships that would elevate the Affordable Connectivity Program, and in particular should focus on on-site service coordinators at properties. NCTA comments that allowing partner agencies to gain access to the National Verifier would allow partner agencies to host on-site enrollment events and provide immediate support to eligible households navigating the application process.

33. The Commission also acknowledges that ACP participating providers serve a pivotal role in enrolling eligible Federal housing assistance recipients in the Affordable Connectivity Program. There is evidence in the record that housing agencies and cities have had success working with providers to offer ACP service to qualified households receiving housing assistance. On the other hand, NDIA argues that public housing tenants and other recipients of housing assistance often distrust providers and NDIA's affiliates have needed to participate in calls between qualified households and providers in order to complete the enrollment process. Organizations participating in the pilot may co-host events with providers, so long as the organization maintains neutrality and does not favor a particular provider or restrict participation in events to particular providers, if multiple ACP providers serve the area. The Commission finds that there is value in providers promoting their services to this eligible population so long as it is done in compliance with the Commission's rules and is consistent with Congress's consumer protection requirements. The Commission reminds providers wishing to send their agents to a location where there is on-site application assistance of the requirements that the Commission established in the ACP Order to protect consumers, including the need to provide disclosures about the Affordable Connectivity Program and to capture informed consent prior to enrolling a household. Providers are prohibited from linking enrollment in the Affordable Connectivity Program to some other action such signing up for Lifeline service and from engaging in upselling and downselling of ACP services.

34. USAC will be required to grant access to the National Verifier to approved pilot applicants that meet the established requirements for such access for purposes of assisting eligible Federal housing assistance recipients with the application process. Consistent with current practice in the Lifeline program, the Commission requires that representatives of the trusted entities granted access to the National Verifier in this pilot register in the RAD pursuant to the Commission's rules. Entities participating in this pilot must maintain neutrality with respect to ACP participating providers when assisting consumers in connection with this pilot. Selected pilot participants will be required to provide updates to the Bureau regarding their experience with the application process, aggregate, non-personally identifiable information about the consumers they are assisting, any occurrences or incidents involving unauthorized access to the National Verifier ( e.g., by an unauthorized user), and other aspects of the pilot. To help identify the applications that benefited from the application assistance made possible through this pilot, the pilot participants shall ensure that their assigned representative identification number or other identifier as determined by USAC is provided on the application. Additional data to be reported by pilot participants and the format of the required data shall be determined by the Bureau consistent with the direction provided by this document. The data collected will assist the Commission in measuring the success of the pilot and track the progress towards meeting the pilot program goals. The Commission further encourages pilot participants to conduct their own evaluations of outreach efforts and share insights with the Bureau. Upon conclusion of the year-long pilot program, pilot participants will no longer have access to the National Verifier absent further action by the Bureau or the Commission.

35. Finally, the Commission recognizes the important role that navigators can play in helping all eligible households, including those not receiving Federal housing assistance, manage the ACP application process. To learn more about those opportunities, the Commission will also be establishing guidance for participation in a separate Navigator Pilot that will focus on helping other ACP eligible households with the application. Your Home, Your Internet Pilot Program participants are eligible to participate in the separate ACP Navigator Pilot, and the Commission encourages them to consider participating in both to ensure the widest impact to the Affordable Connectivity Program. To that end, the Commission directs the Bureau, in consultation with USAC, to consider ways to streamline the application processes and necessary training to permit entities qualified to serve in the Your Home, Your Internet Pilot Program and the ACP Navigator pilots to participate in both. The efficiencies gained by allowing dual participation by entities qualified to participate in both pilots will allow the Commission to quickly stand up and track progress toward the goals the Commission has established for each pilot. The Commission directs the CGB, including the Office of Native Affairs and Policy, and the Office of Communications Business Opportunities (OCBO), in coordination with the Bureau and USAC, to promote both pilots among entities likely to be eligible to participate.

36. Below the Commission discusses the required procedures for entities eligible and interested in applying to participate in the Your Home, Your Internet Pilot Program. The Commission next discusses the selection criteria the Bureau will use to select up to 20 Your Home, Your internet participants.

37. Application Process. Eligible entities seeking to participate in the pilot program must apply and be approved by the Bureau. The Commission directs the Bureau, in coordination with other Bureaus and Offices, as necessary, to establish an application review process for interested pilot participants consistent with this document. The Commission directs the Bureau to establish an application window during which interested entities seeking approval to participate in the pilot program will receive guaranteed consideration of their submitted application. The Commission believes that establishing this window will not only allow the Bureau to select a diverse group of pilot participants, but also encourage selected entities to work quickly to ensure appropriate measures are in place to assist Federal housing assistance recipients with navigating the ACP application. The Commission directs the Bureau to consider the timing of available grant awards for the Affordable Connectivity Outreach Grant Program when considering the deadlines for the filing window.

38. As a part of the application process, interested entities will be required to submit a detailed proposal explaining their plan. Applicants should also be prepared to submit, at a minimum, information about the entities including any partnerships; the geographic areas (including whether rural, urban, tribal, or other) and constituencies the entity intends to serve (including estimates of the number of eligible households with which the entity would engage); housing or other state, local, or Tribal agencies with which the entity works; and to provide a description of the entity's role in the community which it is serving. Tenant associations, non-profits, and community-based organizations should also include information about the government entity providing support for their partnership as well as describing the nature of the partnership.

39. Selection Criteria. In order to increase participation in the Affordable Connectivity Program, the Commission's goal is to select applications that target areas with lower program participation rates and areas where application assistants or navigators will have the most impact on addressing barriers Federal housing assistance recipients face when navigating the ACP application. The Commission directs the Bureau to review applications and select entities to participate in the pilot program in a manner that ensures a geographically diverse group of pilot participants, representing both urban and rural areas. Within 60 days of the release of this document, the Commission directs the Bureau to issue a public notice announcing the pilot application requirements and the deadline for submitting applications during the window. In order to increase the chances of attracting a diverse variety of applications, the application window will be open for no fewer than 28 days. Interested entities should not submit applications to participate in this pilot prior to the opening of the window. The Commission further delegates authority to the Bureau to provide additional guidance to prospective pilot participants where necessary to carry out this document.

40. Participation in the Your Home, Your Internet Pilot Program will initially be limited to no more than 20 participants. Depending on pilot program demand from entities seeking to participate, the Commission delegates to the Bureau the option to accept more than 20 participants into the pilot program if doing so would further the goals of the pilot. The Commission directs the Bureau to establish necessary systems and processes to fairly and systematically review pilot applications. Applicants will be notified by the Bureau of their selection to participate in the pilot. The Commission further directs the Bureau to consolidate, where possible, the application process for the ACP Navigator Pilot with this pilot to allow participation by entities that are eligible to participate in both.

41. In order to properly analyze the results of the Your Home, Your Internet Pilot Program, the Commission adopts requirements for pilot participants to provide data and other information necessary for the Bureau to issue a report summarizing the results of the pilot. The Commission directs the Bureau to submit a report to the Commission after the conclusion of the Your Home, Your Internet Pilot Program to inform the Commission's future efforts to facilitate the Affordable Connectivity Program application process for households receiving Federal housing assistance.

42. Data. When adopting the ACP rules, the Commission directed Commission staff, with support from USAC, to collect data, including possibly via a survey, that measures the general public's awareness of the Affordable Connectivity Program. The Commission directs the Bureau and the Office of Economics and Analytics (OEA), with support from USAC, to work with the entities that participate in the pilot to collect information that could be used to measure program performance while balancing the additional burdens such coordination may impose on the pilot participants. Helpful data may include the number, location (city and state), nature of their outreach, and type (local, state, Tribal, Federal, non-profit, community-based organization, etc.) of trusted partners that participate in the pilot. In addition, the Commission directs USAC to collect data regarding the number of applications started, applications completed, and subsequent enrollments of self-reported Federal housing assistance recipients that have been assisted by trusted partners. Surveys may be used to gather additional information which may not be captured through available data sources. The Commission gives the Bureau, OEA, and USAC the option to conduct surveys on the awareness of the Affordable Connectivity Program among Federal housing assistance program participants and any enrollment barriers these households may have faced. Additionally, to help protect participants' personally identifiable information, the Commission delegates to the Bureau the authority to issue additional guidance addressing the appropriate and necessary protections regarding the collection of participant data.

43. Performance Goals. Through this pilot program, the Commission aims to increase awareness of and participation in the Affordable Connectivity Program among the Federal housing assistance recipients and to identify the barriers to enrollment for Federal housing assistance recipients. To that end, it is important to establish performance measurements and goals to determine how the Commission can ensure maximum participation by qualified Federal housing assistance recipients during and beyond the pilot's term.

44. To evaluate the success of the Your Home, Your Internet Pilot Program, it will be important to track applications and enrollments and to solicit feedback from partners and households about their experience enrolling in the Affordable Connectivity Program. The Commission directs the Bureau and OEA, with support from USAC, to track and collect appropriate data and to further develop metrics to determine progress toward the pilot's goal of increasing awareness of and enrollment in the Affordable Connectivity Program among households participating in qualifying Federal housing assistance programs. The Commission directs OEA, the Bureau, and USAC to consider tracking, for both Federal housing assistance and non-Federal housing assistance households: the ratio of enrollments to qualified applications; the ratio of qualified applications to all applications; and the participation rate for Federal housing assistance recipients and all households to measure any improvement in these metrics as a result of the pilot. Because households receiving Federal housing assistance may well participate in other ACP-qualifying programs, the Commission expects that this analysis will necessarily rely to some extent on households to self-report that they receive Federal housing assistance on their ACP application form. The Commission encourages partners to remind households completing the application to indicate all of the qualifying programs in which they participate so that the Commission can better identify and track the households that self-report as receiving Federal housing assistance, even if those households ultimately are qualified based on income, their participation in Medicaid, or another qualifying program. To the extent possible, the Commission directs OEA and the Bureau, with assistance from USAC, to identify ways in which HUD can provide relevant information to construct measures of performance, including checking current qualified subscribers against HUD databases to identify subscribers who participate in Federal housing assistance programs but did not indicate so on their application.

45. The Commission also directs the Bureau, in coordination with USAC and OEA, to identify ways in which program requirements, application and enrollment processes, and the ways in which the Affordable Connectivity Program is promoted can better serve Federal housing assistance recipients. For example, Chicago Housing Authority argues that because some households do not have an email address, establishing one when applying through the online application can result in delays. Through this pilot, the Commission can track how the email address requirement impacts the timely completion of the ACP application.

46. Final report. Within 180 days of the completion of the one-year pilot, the Commission directs the Bureau to send a report to the Commission summarizing its results. The report should describe the Your Home, Your Internet Pilot Program's successes and challenges and include recommendations on further action to increase participation in the Affordable Connectivity Program among Federal housing assistance recipients, including addressing, consistent with the program requirements set forth in the Infrastructure Act and the Commission's obligation to limit waste, fraud, and abuse in the Affordable Connectivity Program, barriers to enrollment. In developing the report, staff should consider the experience of the trusted entities granted access to the National Verifier and the impact granting this access to the National Verifier had on the number of qualified applications for those who receive Federal housing assistance. The Bureau, OEA, or USAC may also conduct focus groups or send a questionnaire/survey to pilot participants assisting Federal housing assistance recipients with the application to help with these and other questions. Based on findings in the final pilot report and feedback from pilot participants, the Bureau and/or USAC may release additional guidance regarding the potential expansion of access to the National Verifier to assist with completion of the ACP application.

47. It is clear from the record that the groups that serve Federal housing assistance recipients are mobilized and eager to continue to work with Federal housing assistance recipients to maximize the benefits offered through the Affordable Connectivity Program. The pilot the Commission establishes is just one of the tools the Commission is standing up to target eligible households to increase their participation in the Affordable Connectivity Program. Through the Your Home, Your Internet Pilot Program the Commission adopts, along with the ACP Navigator Pilot, and the Outreach Grant Order and the Notice of Funding Opportunity anticipated for the fall, the Commission will empower its governmental and non-profit partners with the tools to reach more eligible households to promote the Affordable Connectivity Program and to encourage their participation. To that end, the Commission directs the Bureau, in coordination with other Offices and Bureaus, as well as USAC, to establish this pilot program consistent with the timetables the Commission adopts in this document to expand program awareness and to assist with the completion of the applications. The Commission also delegates to the Bureau the authority to make modifications to the National Verifier to implement recommendations in the final report to address any barriers to enrollment, consistent with program requirements set forth in the Infrastructure Act as well as the Commission's obligation to limit waste, fraud, and abuse in the Affordable Connectivity Program. The Commission also encourages those entities that plan to participate in this pilot program to look for guidance to be issued in the coming months on the ACP Navigator Pilot and Outreach Grant Program funding opportunities to boost the grassroots support to eligible households the Commission enables through these pilots.

48. Regulatory Flexibility Act. The Regulatory Flexibility Act of 1980, as amended (RFA), requires that an agency prepare a final regulatory flexibility analysis “whenever an agency promulgates a final rule under [5 U.S.C. 553], after being required by that section or any other law to publish a general notice of proposed rulemaking.” The Commission's Consumer and Governmental Affairs Bureau, Reference Information Center, will send a copy of the Third Report and Order, including the FRFA, to the Chief Counsel for Advocacy of the Small Business Administration (SBA). Consistent with the Regulatory Flexibility Act of 1980, as amended (RFA), an Initial Regulatory Flexibility Analysis (IRFA) was incorporated in the Affordable Connectivity Program Further Notice of Proposed Rulemaking ( ACP FNPRM ). The Commission sought written public comment on proposals in the ACP FNPRM, including comment on the IRFA. The Commission did not receive any comments in response to this IRFA. This Final Regulatory Flexibility Analysis (FRFA) conforms to the RFA.

49. The Affordable Connectivity Program provides a monthly discount of up to $30 per month (and up to $75 per month for households on qualifying Tribal lands) as well as a one-time $100 discount toward a laptop, desktop computer, or tablet. When adopting the final rules for the Affordable Connectivity Program, the Commission sought further comment on a proposal to target outreach and provide application support to residents of public housing and other Federal Public Housing Assistance (FPHA) recipients that are eligible for the Affordable Connectivity Program.

50. The ACP FNPRM proposed and sought comment on a pilot program focused on expanding ACP participation by FPHA program (including housing choice voucher program (Section 8), project-based rental assistance, and public housing) recipients including increasing awareness and assisting with navigating the ACP enrollment process. To that end, the Commission proposed and sought comment on a pilot program to develop partnerships with agencies that administer the FPHA programs for collaborative cross-agency outreach and marketing regarding the Affordable Connectivity Program to recipients of those housing programs. The ACP FNPRM sought comment on how the Commission could structure this pilot, how to make the pilot effective, data sources the Commission could use to identify locations for this pilot, and how to measure the success of the pilot. In this document, the Commission establishes a one-year pilot program with the goal of increasing awareness of the Affordable Connectivity Program among Federal housing assistance recipients and facilitating enrollment into the program by providing targeted assistance with completion of the ACP application. The document sets forth the details of the pilot by identifying the government entities and third-party organizations who may apply to participate in the pilot to gain limited access to the National Verifier to help Federal housing assistance recipients complete and submit their ACP applications. The document also identifies changes to the ACP application process, the success of which will be tested in the Your Home, Your Internet Pilot Program.

51. The Commission did not receive comments that specifically addressed the IRFA contained in the ACP FNPRM.

52. Pursuant to the Small Business Jobs Act of 2010, which amended the RFA, the Commission is required to respond to any comments filed by the Chief Counsel of the Small Business Administration (SBA), and to provide a detailed statement of any changes made to the proposed rule(s) as a result of those comments.

53. The Chief Counsel did not file any comments in response to the ACP FNPRM.

54. The RFA directs agencies to provide a description of, and where feasible, an estimate of the number of small entities that may be affected by the proposed rules, if adopted. The RFA generally defines the term ”small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. A small business concern is one that: (1) is independently owned and operated; (2) is not dominant in its field of operation; (3) satisfies any additional criteria established by the Small Business Administration (SBA).

55. Small Businesses, Small Organizations, Small Governmental Jurisdictions. The Commission's actions, over time, may affect small entities that are not easily categorized at present. The Commission therefore describes here, at the outset, three broad groups of small entities that could be directly affected herein. First, while there are industry specific size standards for small businesses that are used in the regulatory flexibility analysis, according to data from the Small Business Administration's (SBA) Office of Advocacy, in general a small business is an independent business having fewer than 500 employees. These types of small businesses represent 99.9% of all businesses in the United States, which translates to 32.5 million businesses.

56. Next, the type of small entity described as a “small organization” is generally “any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.” The Internal Revenue Service (IRS) uses a revenue benchmark of $50,000 or less to delineate its annual electronic filing requirements for small exempt organizations. Nationwide, for tax year 2020, there were approximately 447,689 small exempt organizations in the U.S. reporting revenues of $50,000 or less according to the registration and tax data for exempt organizations available from the IRS.

57. Finally, the small entity described as a “small governmental jurisdiction” is defined generally as “governments of cities, counties, towns, townships, villages, school districts, or special districts, with a population of less than fifty thousand.” U.S. Census Bureau data from the 2017 Census of Governments indicate that there were 90,075 local governmental jurisdictions consisting of general purpose governments and special purpose governments in the United States. Of this number there were 36,931 general purpose governments (county, municipal and town or township) with populations of less than 50,000 and 12,040 special purpose governments—independent school districts with enrollment populations of less than 50,000. Accordingly, based on the 2017 U.S. Census of Governments data, the Commission estimates that at least 48,971 entities fall into the category of “small governmental jurisdictions.”

58. Wired Broadband Internet Access Service Providers (Wired ISPs). Providers of wired broadband internet access service include various types of providers except dial-up internet access providers. Wireline service that terminates at an end user location or mobile device and enables the end user to receive information from and/or send information to the internet at information transfer rates exceeding 200 kilobits per second (kbps) in at least one direction is classified as a broadband connection under the Commission's rules. Wired broadband internet services fall in the Wired Telecommunications Carriers industry. The SBA small business size standard for this industry classifies firms having 1,500 or fewer employees as small. U.S. Census Bureau data for 2017 show that there were 3,054 firms that operated in this industry for the entire year. Of this number, 2,964 firms operated with fewer than 250 employees.

59. Additionally, according to Commission data on internet access services as of December 31, 2018, nationwide there were approximately 2,700 providers of connections over 200 kbps in at least one direction using various wireline technologies. The Commission does not collect data on the number of employees for providers of these services, therefore, at this time the Commission is not able to estimate the number of providers that would qualify as small under the SBA's small business size standard. However, in light of the general data on fixed technology service providers in the Commission's 2020 Communications Marketplace Report, the Commission believes that the majority of wireline internet access service providers can be considered small entities.

60. Wireless Broadband Internet Access Service Providers (Wireless ISPs or WISPs). Providers of wireless broadband internet access service include fixed and mobile wireless providers. The Commission defines a WISP as “[a] company that provides end-users with wireless access to the Internet[.]” Wireless service that terminates at an end user location or mobile device and enables the end user to receive information from and/or send information to the internet at information transfer rates exceeding 200 kilobits per second (kbps) in at least one direction is classified as a broadband connection under the Commission's rules. Neither the SBA nor the Commission have developed a size standard specifically applicable to Wireless Broadband Internet Access Service Providers. The closest applicable industry with an SBA small business size standard is Wireless Telecommunications Carriers (except Satellite). The SBA size standard for this industry classifies a business as small if it has 1,500 or fewer employees. U.S. Census Bureau data for 2017 show that there were 2,893 firms in this industry that operated for the entire year. Of that number, 2,837 firms employed fewer than 250 employees.

61. Additionally, according to Commission data on internet access services as of December 31, 2018, nationwide there were approximately 1,209 fixed wireless and 71 mobile wireless providers of connections over 200 kbps in at least one direction. The Commission does not collect data on the number of employees for providers of these services, therefore, at this time the Commission is not able to estimate the number of providers that would qualify as small under the SBA's small business size standard. However, based on data in the Commission's 2020 Communications Marketplace Report on the small number of large mobile wireless nationwide and regional facilities-based providers, the dozens of small regional facilities-based providers and the number of wireless mobile virtual network providers in general, as well as on terrestrial fixed wireless broadband providers in general, the Commission believes that the majority of wireless internet access service providers can be considered small entities.

62. In this document the Commission establishes the requirements for the pilot program designed to increase awareness of and participation in the Affordable Connectivity Program among Federal housing assistance recipients. For eligible entities seeking to participate in the pilot program the Commission adopted an application process that requires, at minimum, entities to submit information about the entities including any partnerships; their geographic areas (including whether rural, urban, or other) and constituencies the entity intends to serve (including estimates of the number of eligible households with which the entity would engage); housing or other state, local, or Tribal authorities with which the entity works; and to provide a description of the entity's role in the community which it is serving. Tenant associations, non-profits, or community-based organizations should include, as a part of their application, information about the government entity providing support for their partnership as well as describing the nature of the partnership. In order to increase participation in the Affordable Connectivity Program, the Commission's goal is to select applications that target areas with low program participation rates and areas where application assistants or navigators will have the most impact on addressing barriers Federal housing assistance recipients face when navigating the ACP application. The Commission therefore, established an application window, during which interested entities seeking approval to participate in the pilot program will receive guaranteed consideration of their submitted application. The Bureau, will select pilot participants based on applications, and applicant's responses to the information criteria listed above. Applicants that seek funding for their pilot program activities will need to abide by any application requirements established in the Affordable Connectivity Outreach Grant Program.

63. Similar to the current practice in the Lifeline program, the Commission will require representatives of the entities granted access to the National Verifier to register in the RAD. Also, selected pilot participants will be required to provide updates to the Bureau and USAC regarding their experience with the application process, aggregate, non-personally identifiable information about the consumers they are assisting, any occurrences or incidents involving unauthorized access to the National Verifier ( e.g., by an unauthorized user), and other aspects of the pilot. Additionally, in order to help identify the applications that benefited from the application assistance made possible through this pilot, assistants shall ensure that their assigned representative identification number or other identifier as determined by USAC is provided on the application. Additional data to be reported by pilot participants and the format of the required data shall be determined by the Bureau consistent with the direction provided by this document. The Commission encourages pilot participants to conduct their own evaluations of outreach efforts and share insights with the Bureau.

64. The Commission will require the Bureau and the Office of Economics and Analytics (OEA), with support from USAC, to work with entities that participate in this pilot to collect information that could be used to measure program performance. Helpful data may include the number, location (city and state), the nature of their outreach, and type (local, state, Federal, non-profit, community-based organization, etc.) of trusted partners that participate in this pilot. Surveys may be used to gather additional information which may not be captured through available data sources. The Commission gives the Bureau, OEA, and USAC the option to conduct surveys on the awareness of the Affordable Connectivity Program among Your Home, Your Internet participants and any enrollment barriers these households may have faced. Additionally, to help protect participants' personally identifiable information, the Commission delegates to the Bureau the authority to issue additional guidance addressing the appropriate and necessary protections regarding the collection of participant data.

65. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its approach, which may include the following four alternatives (among others): “(1) the establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance and reporting requirements under the rule for such small entities; (3) the use of performance rather than design standards; and (4) an exemption from coverage of the rule, or any part thereof, for such small entities.”

66. The Commission has considered the economic impact on small entities in reaching its final conclusions and taking action in this proceeding. The pilot program that the Commission establish in this document will help to identify and address barriers to enrollment for Federal housing assistance recipients and provide an efficient application process for all pilot participants, including small entities. The Commission intends to minimize the burdens imposed on small entities where doing so would not compromise the goals of the Affordable Connectivity Program and this pilot program. The regulatory burdens, such as the voluntary application process and data collection, can be used to measure program performance while balancing the additional burdens that may be imposed on Your Home, Your Internet Pilot Program participants. The Commission will continue to examine alternatives in the future with the objective of eliminating unnecessary regulations and minimizing any significant impact on small entities.

67. The Commission will send a copy of the Third Report and Order, including the FRFA, in a report to be sent to Congress pursuant to the Congressional Review Act. In addition, the Commission will send a copy of the Third Report and Order, including this FRFA, to the Chief Counsel for Advocacy of the SBA. A copy of the Third Report and Order, including the FRFA (or summaries thereof), will also be published in the Federal Register .

68. Congressional Review Act. The Commission has determined, and the Administrator of the Office of Information and Regulatory Affairs, Office of Management and Budget, concurs, that this rule is “non-major” under the Congressional Review Act, 5 U.S.C. 804(2). The Commission will send a copy of the Third Report and Order to Congress and the Government Accountability Office pursuant to 5 U.S.C. 801(a)(1)(A).

69. Paperwork Reduction Act. Pursuant to 47 U.S.C. 1752(h)(2), the collection of information sponsored or conducted under the regulations promulgated in the Third Report and Order is deemed not to constitute a collection of information for the purposes of the Paperwork Reduction Act, 44 U.S.C. 3501-3521.

70. Accordingly, it is ordered that, pursuant to the authority contained in Section 904 of Division N, Title IX of the Consolidated Appropriations Act, 2021, Public Law 116-260, 134 Stat. 1182, as amended by Infrastructure Investment and Jobs Act, Public Law 117-58, 135 Stat. 429 (2021), the Report and Order is adopted.

71. It is further ordered that the Office of the Managing Director, Performance Evaluation and Records Management, shall send a copy of the Third Report and Order in a report to be sent to Congress and the Government Accountability Office pursuant to the Congressional Review Act, 5 U.S.C. 801(a)(1)(A).

72. It is further ordered, that the Commission's Consumer and Governmental Affairs Bureau, Reference Information Center, shall send a copy of the Third Report and Order, including the Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.

The proposed rule was published at 87 FR 25196 on April 28, 2022. The Petitioner filed comments in support of the petition reaffirming its commitment to apply for channel *20. No other comments were filed.

We find that the public interest would be served by substituting channel *20 for channel *10 at Augusta, Maine since it would improve access to WCBB's PBS and other public television programming by improving indoor reception. Although the proposed channel *20 facilities will result in a predicted loss of service to 3,785 persons, much of the predicted loss area is located outside the state of Maine and the “vast majority” is served by Petitioner's owned and operated stations WMEB-TV, Orono, Maine (WMEB-TV), and WMEA-TV, Biddeford, Maine, or by other PBS member stations WENH-TV, Durham, New Hampshire, WLED-TV, Littleton, New Hampshire, and WVTB, St. Johnsbury, Vermont. Once these other sources of PBS programing and terrain-limitations are factored into the loss analysis, the new loss area that would be created by the proposed channel substitution would contain 155 persons, which is within the level the Commission considers de minimis in the context of considering impermissible loss of service. Since the proposed facility is located within the Canadian coordination zone, concurrence from the Canadian government was required and has subsequently been obtained.

This is a synopsis of the Commission's Report and Order, MB Docket No. 22-150; RM-11926; DA 22-900, adopted August 29, 2022, and released August 29, 2022. The full text of this document is available for download at https://www.fcc.gov/edocs. To request materials in accessible formats for people with disabilities (braille, large print, electronic files, audio format), send an email to fcc504@fcc.gov or call the Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-418-0432 (tty).

This document does not contain information collection requirements subject to the Paperwork Reduction Act of 1995, Public Law 104-13. In addition, therefore, it does not contain any proposed information collection burden “for small business concerns with fewer than 25 employees,” pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4). Provisions of the Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, do not apply to this proceeding.

The Commission will send a copy of the Report and Order in a report to be sent to Congress and the Government Accountability Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR part 73 as follows:

The proposed rule was published at 87 FR 34624 on June 7, 2022. The Petitioner filed comments in support of the petition reaffirming its commitment to apply for channel *22. No other comments were filed.

We believe the public interest would be served by substituting channel *22 for channel *9 at Orono, Maine, since it would improve access to WMEB-TV's PBS and other public television programming by improving indoor reception. Although the proposed channel *20 facilities will result in a predicted loss of service, much of the predicted loss area is served by the Petitioner's other commonly owned stations WCBB(TV), Augusta, Maine (WCCB), and WMED-TV, Calais, Maine, which largely air the same programming as WMEB-TV. Once these other sources of PBS programing and terrain limitations are factored into the loss analysis, the new loss area created by the proposed channel substitution would contain only 523 persons, which is within the level the Commission considers de minimis in the context of determining whether there would be an impermissible loss of service. Moreover, the proposed channel change would result in first service to a substantial number of persons. As set forth in the Engineering Statement submitted with the Petition, the proposed facilities would reach 25,238 persons that do not currently receive WMEB-TV and of those persons, 5,558 would receive their first television service and 10,681 would receive their first noncommercial educational (NCE) television service. Since the proposed facility is located within the Canadian coordination zone, concurrence from the Canadian government was required and has subsequently been obtained.

This is a synopsis of the Commission's Report and Order, MB Docket No. 22-215; RM-11929; DA 22-899, adopted August 29, 2022, and released August 29, 2022. The full text of this document is available for download at https://www.fcc.gov/edocs . To request materials in accessible formats for people with disabilities (braille, large print, electronic files, audio format), send an email to fcc504@fcc.gov or call the Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-418-0432 (tty).

This document does not contain information collection requirements subject to the Paperwork Reduction Act of 1995, Public Law 104-13. In addition, therefore, it does not contain any proposed information collection burden “for small business concerns with fewer than 25 employees,” pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4). Provisions of the Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, do not apply to this proceeding.

The Commission will send a copy of the Report and Order in a report to be sent to Congress and the Government Accountability Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR part 73 as follows: