[Federal Register Volume 87, Number 183 (Thursday, September 22, 2022)]
[Proposed Rules]
[Pages 57859-57863]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-20350]



Pipeline and Hazardous Materials Safety Administration

49 CFR Parts 107

[Docket No. PHMSA-2022-0033 (HM-208J)]
RIN 2137-AF59

Hazardous Materials: Adjusting Registration and Fee Assessment 

AGENCY: Pipeline and Hazardous Materials Safety Administration

[[Page 57860]]

(PHMSA), Department of Transportation (DOT).

ACTION: Advance notice of proposed rulemaking (ANPRM).


SUMMARY: PHMSA is publishing this ANPRM to solicit feedback on 
potential adjustments to the statutorily mandated hazardous materials 
registration and fee assessment program. Actions such as the potential 
adjustment of fees or the addition of other entities among those 
required to register may be necessary to fund PHMSA's national 
emergency preparedness grant programs at the newly authorized level in 
accordance with the Infrastructure Investment and Jobs Act of 2021. To 
fully engage with stakeholders, this ANPRM solicits comments and input 
on questions related to the scope of the registration and fee 
assessment program. Any comments, data, and information received will 
be used to evaluate and draft proposed amendments.

DATES: Comments must be received by December 21, 2022. However, PHMSA 
will consider late-filed comments to the extent possible.

ADDRESSES: You may submit comments identified by the docket number 
PHMSA-2022-0033 (HM-208J) by any of the following methods:
     Federal e-Rulemaking Portal: https://www.regulations.gov. 
Follow the online instructions for submitting comments.
     Fax: (202) 493-2251.
     Mail: Docket Management System, U.S. Department of 
Transportation, Dockets Operations, M-30, Ground Floor, Room W12-140, 
1200 New Jersey Avenue SE, Washington, DC 20590.
     Hand Delivery: U.S. Department of Transportation, Docket 
Operations, M-30, Ground Floor, Room W12-140 in the West Building, 1200 
New Jersey Avenue SE, Washington, DC 20590, between 9 a.m. and 5 p.m., 
Monday through Friday, except Federal holidays.
    Instructions: All submissions must include the agency name and 
docket number (PHMSA-2022-0033) or RIN 2137-AF59 for this ANPRM at the 
beginning of the comment. Note that all comments received will be 
posted without change to https://www.regulations.gov including any 
personal information provided. If sent by mail, comments must be 
submitted in duplicate. Persons wishing to receive confirmation of 
receipt of their comments must include a self-addressed stamped 
    Docket: For access to the dockets to read background documents or 
comments received, go to https://www.regulations.gov or DOT's Docket 
Operations Office; see ADDRESSES.
    Confidential Business Information: Confidential Business 
Information (CBI) is commercial or financial information that is both 
customarily and treated as private by its owner. Under the Freedom of 
Information Act (FOIA; 5 U.S.C. 552), CBI is exempt from public 
disclosure. If your comments responsive to this ANPRM contain 
commercial or financial information that is customarily treated as 
private, that you treat as private, and that is relevant or responsive 
to this ANPRM, it is important that you clearly designate the submitted 
comments as CBI. Please mark each page of your submission containing 
CBI as ``PROPRIETARY.'' PHMSA will treat such marked submissions as 
confidential under the Freedom of Information Act (FOIA) and they will 
not be placed in the public docket of this ANPRM. Submissions 
containing CBI should be sent to Yul B. Baker Jr., Standards and 
Rulemaking Division, Office of Hazardous Materials Safety, (202) 366-
8553, PHMSA, East Building, PHH10, 1200 New Jersey Avenue SE, 
Washington, DC 20590. Any commentary that PHMSA receives, which is not 
specifically designated as CBI, will be placed in the public docket for 
this rulemaking.

Rulemaking Division, Office of Hazardous Materials Safety, (202) 366-
8553, PHMSA, East Building, PHH10, 1200 New Jersey Avenue SE, 
Washington, DC 20590 and Adam Lucas, Operations System Division, Office 
of Hazardous Materials Safety, (202) 366-1074 PHMSA, East Building, 
PHH-60, 1200 New Jersey Avenue SE, Washington, DC 20590.


Table of Contents

I. Background
II. Number of Registrants for Registration Year 2021-22
III. Registration Fee Scenario Table
IV. Options for Public Comment

I. Background

    PHMSA is considering an adjustment to our statutorily mandated 
registration and fee assessment program for persons who transport or 
offer for transportation certain categories and quantities of hazardous 
materials. PHMSA conducts a national hazardous materials registration 
program under the mandate in 49 U.S.C. 5108 for a person \1\ who offers 
for transportation or transports certain hazardous materials in 
intrastate, interstate, or foreign commerce. The registration program 
implements the mandate for persons to file a registration statement 
with the Secretary of Transportation--as delegated to PHMSA--and 
collects registration and processing fees from persons required to file 
a registration statement (hereafter referred to as ``registrants'') to 
fund Emergency Preparedness (EP) grants. EP grants support hazardous 
materials emergency response planning and training activities by 
states, local governments, and Native American Tribes. EP grants also 
fund non-profit organizations to provide ``train-the-trainer'' programs 
for hazardous materials emergency response training and hazardous 
materials employee training. Additionally, EP grants support the 
development of the Emergency Response Guide (ERG) and provides funds 
for grantee monitoring and technical assistance.

    \1\ Defined in 49 CFR 171.8.

    As noted above, registration and fee requirements \2\ apply to a 
person who offers for transportation--or who transports--hazardous 
material in foreign, interstate, or intrastate commerce. Specifically, 
the requirements apply to shippers and carriers if they offer or 
transport the following:

    \2\ See Sec.  107.601 Applicability.

    1. A highway route-controlled quantity of a Class 7 (radioactive) 
    2. More than 25 kg (55 pounds) of a Division 1.1, 1.2, or 1.3 
(explosive) material in a motor vehicle, rail car or freight container.
    3. More than one L (1.06 quarts) per package of a material 
extremely toxic by inhalation.
    4. A shipment of a quantity of hazardous materials in a bulk 
packaging having a capacity equal to or greater than 13,248 L (3,500 
gallons) for liquids or gases, or more than 13.24 cubic meters (468 
cubic feet) for solids.
    5. A shipment in other than a bulk packaging of 2,268 kg. (5,000 
pounds) gross weight or more of one class of hazardous materials for 
which placarding of a vehicle, rail car, or freight container is 
    6. Except for certain farming operations, a quantity of hazardous 
material that requires placarding.
    Furthermore, PHMSA has discretion to require additional persons to 
register--beyond those who offer, and transport certain categories and 
quantities of hazardous materials listed in 49 U.S.C. 5108(a)(1)--and 
to set the annual registration fee between the statutorily mandated 
minimum and maximum amounts. See 49 U.S.C. 5108(b), 5116, and 5128(b). 
PHMSA may currently set an annual registration

[[Page 57861]]

fee between a minimum of $250 and maximum of $3,000.
    Since 2010, the annual registration fee has been set at $250 (plus 
a $25 processing fee) for small businesses \3\ and not-for-profit 
organizations (hereafter referred to as ``small businesses'') and 
$2,575 (plus a $25 processing fee) for not small businesses (hereafter 
referred to as ``large businesses'') in accordance with 49 CFR 

    \3\ ``Small Business'' here is defined as either a ``small 
business'' per the SBA or a non-profit, which statutorily pay the 
same rate as small businesses, regardless of size.

    On November 15, 2021, President Biden signed the Infrastructure 
Investment and Jobs Act of 2021 (Pub. L. 117-58)--commonly known as the 
``Bipartisan Infrastructure Law'' (BIL) \4\--into law and authorized 
the Secretary of Transportation to expend $46,825,000 from EP funds to 
carry out the grants program, for fiscal years 2022 through 2026. As 
such, the BIL increases the authorized level of the EP grants program 
by $18,507,000. To fully fund the EP grants program to the increased 
authorization amounts, PHMSA will need to adjust fees for the national 
registration and fee program.

    \4\ See BIL at: https://www.congress.gov/117/bills/hr3684/BILLS-117hr3684enr.pdf.

    The current registration fee structure does not consider the 
relative risk of applicants, products, transport routes, or other 
relative risks (or lack thereof) imposed by an applicant to the public 
due to the specific hazardous materials being transported. This poses 
challenges and potential opportunities for improvement, consistent with 
market-based principles as well as principles of equity and fairness: 
the potential for a registration scheme that reflects many applicants' 
relatively minor imposition of risk on the public as well as a more 
equitable fee structure for the few entities that pose a 
disproportionately larger risk on the public.

II. Number of Registrants for Registration Year 2021-22 \5\

    \5\ A registration year runs from July 1 of the current year to 
June 30 of the following year.

    Using the current registration year 2021-22 as an example, there 
were 25,529 small business registrants that paid $6,382,250 in 
registration fees and $638,225 in processing fees--while there were 
6,673 large business registrants that paid $17,183,975 in registration 
fees and $166,825 in processing fees. The total funds from all 
registrants--not including processing fees--were approximately 
$23,565,225 for the registration year. PHMSA may collect additional 
monies to fund EP grants at the increased authorization level of 
$46,825,000 specified in the BIL. As one approach, PHMSA has asked 
Congress for authorization to increase the maximum fee for a registrant 
as a possible means to collect additional funds. Other approaches 
include expanding the pool of persons subject to registration or 
increasing fee amounts from current levels. Though more complicated, an 
additional approach could involve any number of factors to capture fees 
based on the relative risk an applicant poses via the transportation of 
hazardous material goods.
    Historically, as noted in Section I. ``Background,'' there are 
triggering requirements for registration and fee payments based on 
certain types of transport activity performed by a shipper or carrier. 
If a company is required to register, assigned fees are based on the 
type and size of the business performing the activity. PHMSA is 
contemplating an approach of factoring in the level of exposure or risk 
introduced by a shipper or carrier when assigning fees--for example, if 
a business operates globally and transports a particularly hazardous 
material, it might incur a slightly higher fee than a smaller business, 
which poses a relatively minor risk to the public and may therefore 
incur a lower fee. Thus, in this ANPRM, PHMSA solicits comment from the 
public on how best to collect additional funding and to help initiate 
ideas on different approaches. PHMSA provides a registration fee 
scenario table in Section III. ``Registration Fee Scenario Table'' to 
offer a basic illustration of the potential impacts of the fee changes 
to registrants. Section IV. ``Options for Public Comment'' provides 
specific scenarios PHMSA is considering for collecting additional funds 
as well as discussion of potential research for development of a 
methodology for a more equitable registration scheme. The scenarios are 
split into two categories of options: (1) based on the current maximum 
fee remaining at $3,000; and (2) based on the possibility of increasing 
the maximum fee.

III. Registration Fee Scenario Table

    To achieve full funding at the new authorized spending level to 
fund the EP grants program, PHMSA presents a fee scenario table as 
visual aid on possible impacts of raising funds from potential sources 
by increasing the fees on large businesses, increasing the number of 
large businesses required to register, or any combination thereof.
     Scenarios A and B involve scenarios in which the entire 
required sum is raised exclusively by increasing one of the sources. 
For example, raising only the fee paid by large businesses, but leaving 
small business fees and registration requirements unchanged. The 
purpose of providing these scenarios is not to necessarily suggest 
their adoption, but rather to illustrate the outer limits of the 
potential factors necessary to raise additional funding.
     Scenarios C-D represent two potential hybrid scenarios, in 
which additional funding is attained from raising several sources, 
rather than a single source. The purpose of providing these scenarios 
is to illustrate how a combination of higher fees and expanded 
registration requirements could achieve the desired funding level. 
Therefore, PHMSA requests comments and feedback on how best to balance 
the factors illustrated in the table below to reach the Congressional 
funding amount, including alternative combinations of raising rates and 
the possibility of expanding registration requirements.

                                        Number of     Rate paid by
     Alternative scenarios for            small           small         Number of large       Rate paid by large   Small business burden       Total
            registrants                businesses      businesses          businesses             businesses                                 collected
Baseline: No change................          27,723            $250  6,886................  $2,575...............  28.10%...............     $24,662,200
Scenario A:
    All additional funds come from           27,723            $250  6,886................  $5,794...............  14.8%................      46,825,000
     large businesses: No expansion
     of registration requirements
     (i.e., how much should we
     raise fees on large businesses
     to avoid impacting small

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    Results for Scenario A: To       ..............  ..............  .....................  2.25x increase.......  -13.3% change in       ..............
     maintain current registration                                                                                  small business
     requirements or rates for                                                                                      burden.
     small businesses, the annual
     rate charged for large
     businesses would have to
     increase to $5,794.
Scenario B:
    Fees are fixed: All additional           27,723            $250  15,493...............  $2,575...............  14.80%...............      46,825,000
     funds come from expanding the
     registration requirements for
     large businesses..
    Results for Scenario B: To       ..............  ..............  2.25x increase in      .....................  -13.3% change in       ..............
     maintain current rates charged                                   large business                                small business
     to either small businesses or                                    applicant pool.                               burden.
     large businesses and not
     expand the pool of small
     businesses, the total number
     of large businesses charged
     would have to increase to
Scenario C:
    Fees on large businesses are             27,723            $250  12,911...............  $3,090...............  14.8%................      46,825,000
     raised 20%: Additional funds
     come from expanding the
     registration requirements for
     large businesses..
    Results for Scenario C: Raising  ..............  ..............  1.87x increase.......  1.20x increase.......  -13.3% change in       ..............
     the fee on large businesses by                                                                                 small business
     20% but holding small business                                                                                 burden.
     fees constant requires a 1.87x
     increase in eligibility for
     large businesses.

                                                          Number of                       Number of
    Alternative scenario for      Number of   Rate paid  ``non-high  Rate paid by ``non-   ``high-      Rate paid by
  registrants considered to be      small     by small     risk''     high risk'' large    risk''       ``high risk''      Small business       Total
    ``non-high risk'' large      businesses  businesses     large        businesses         large     large businesses         burden         collected
           businesses                                    businesses                      businesses
Scenario D:
    Assume 25% of large              27,723        $250       5,165  $3,000............       1,722  $14,182...........  14.8%.............  $46,825,000
     businesses are identified
     as ``high risk.'' Fees for
     small businesses are
     unchanged. Fees for ``non-
     high risk'' large
     businesses are increased
     to the statutory limit of
     $3,000. No increased
     eligibility. All
     additional revenue comes
     from fees on ``high risk''
     large businesses.
    Results for Scenario D: The  ..........  ..........  ..........  1.17x increase....  ..........  5.5x increase.....  -13.3% change in    ...........
     25% of large businesses                                                                                              small business
     deemed to be ``high risk''                                                                                           burden.
     would have to pay a
     registration fee of
     $14,182, 5.5x higher than
     their current registration
1. Bold figures represent the amount each variable would have to be set to make up the additional funding.
2. Bold and italicized figures represent the factor difference between the proposed level and baseline.
3. Information for table was sourced from PHMSA's Registration Dataset.

IV. Options for Public Comment

    The table above provides combinations of increased rates or 
expanded registration requirements to achieve the increased funding 
level. PHMSA requests feedback on these potential methods, and any 
alternate methods PHMSA should consider, to achieve the increased 
funding. Additionally, please address in your submission any impact on 
policy considerations (e.g., equity/distributional impacts or impact on 
small businesses) advocating for or against different options.
    If registration fees remain at a maximum $3,000 per year, PHMSA is 
considering the following options for comment:
    1. Keep the existing registration requirements (see 49 CFR 107.601) 
and raise the registration fee for large businesses from $2,575 to 
    2. Keep the existing registration requirements and apply a nominal 
fee (e.g., $25) for each facility or geographic location from which a 
registered person (i.e., a company) offers for transportation, or 
transports, certain hazardous materials.
    3. Modify assignment of the registration fee and/or amount based on 
the commensurate hazard posed (e.g., shipping Packing Group I materials 
vs. Packing Group III materials) \6\ or risk profile (e.g., frequent 
vs. infrequent shipments).

    \6\ Packing group means a grouping according to the degree of 
danger presented by hazardous materials. Packing Group I indicates 
great danger; Packing Group II, medium danger; Packing Group III, 
minor danger.

    4. Expand the registration requirements--for example, certain 
hazardous materials are not subject to placarding when shipped 
domestically, and therefore a person who offers for transportation, or 
transports, these materials are generally exempt from registration--but 
could be expanded with appropriate risk-based justifications.
    5. Expand the registration fee requirements to include certain 
persons who acquire approvals or special permits from PHMSA that 
otherwise are not subject to registration, but which should be based on 
a public risk-based justification.
    If Congress allows an increase in the maximum fee, PHMSA is 
considering the following options for comment:
    1. Maintain the current maximum registration fees and create an 
upper tier of a higher fee for a certain category of very large 
businesses. If this approach is preferred, how should PHMSA define a 
``very large business?'' Specifically, what risk factors should go into 
determining a very large business classification, to better account for 
market-based risks to the public as well as equity factors between 
    2. Change the registration requirements to reduce the overall 
number of registrants.
    3. Keep the existing registration requirements and raise the 

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fee for large businesses from $2,575 to a dollar value below the 
Congressionally authorized maximum fee (e.g., if the maximum allowed 
were increased from $3,000 to $5,000).
    4. Raise fees for specific business types, classes of material, or 
commodities (e.g., poisonous by inhalation material), which are 
considered extremely high risk.

Registration Fee Equity

    PHMSA may initiate a research effort to develop a methodology that 
could replace the existing two-tier registration structure with a more 
equitable system. This action would help address transportation equity 
by basing the fee structure on the amount of risk introduced into the 
transportation system by an entity. This work would build on the 
questions above (i.e., if registration fees remain at a maximum $3,000 
per year). While PHMSA considers initiating this research effort, PHMSA 
does have two related questions that may help us determine the 
potential scope and how to formulate the research effort:
    1. What risk factors of transporting hazardous materials should 
PHMSA consider?
    2. What data or information is available to support the choice of 
these risk factors and methodology? Please provide all data or 
information you would like PHMSA to consider.
    As noted above, PHMSA seeks comment on each of these questions and 
proposals, as well as any additional options not included in the above-
outlined discussions.

    Issued in Washington, DC, on September 15, 2022, under the 
authority delegated in 49 CFR 1.97.
William S. Schoonover,
Associate Administrator for Hazardous Materials Safety, Pipeline and 
Hazardous Materials Safety Administration.
[FR Doc. 2022-20350 Filed 9-21-22; 8:45 am]