In 1990, Congress passed the Federal Civil Penalties Inflation Adjustment Act of 1990 (FCPIAA) to provide for regular adjustments for inflation of civil monetary penalties (CMPs). As amended by the Debt Collection Improvement Act of 1996, the FCPIAA required that the head of each Federal agency review and, if necessary, adjust by regulation the CMPs assessed under statutes enforced by the agency at least once every 4 years.

On November 2, 2015, the President of the United States signed into law the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (the 2015 Improvements Act), which further amended the FCPIAA and requires Federal agencies to adjust their CMPs annually for inflation no later than January 15 of each year. The requirements of the 2015 Improvements Act apply to the NRC's maximum CMP amounts for 1) a violation of the Atomic Energy Act (AEA) of 1954, as amended, or any regulation or order issued under the AEA, codified in § 2.205(j) of title 10 of the Code of Federal Regulations (10 CFR), “Civil penalties”; and 2) a false claim or statement made under the Program Fraud Civil Remedies Act, codified in 10 CFR 13.3, “Basis for civil penalties and assessments.”

Pursuant to the 2015 Improvements Act, the NRC published today in the Rules section of the Federal Register the revised maximum daily base CMP, based on the percentage change in the consumer price index between October 2021 and October 2022, and codified in 10 CFR 2.205(j). In connection with this final rule, the NRC is publishing a corresponding update to the NRC's Enforcement Policy to adjust the monetary amounts listed in Section 8.0, “Table of Base Civil Penalties.” This monetary adjustment does not include the base civil penalty amounts listed in item f. because those values are based on the estimated or actual costs of authorized disposal and are not calculated based on the maximum daily base CMP codified in 10 CFR 2.205(j). Adjustments to item f. base civil penalty amounts are being examined under a separate effort.

Accordingly, the NRC has revised its Enforcement Policy to read as follows:

This policy statement does not contain any new or amended collection of information subject to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq). Existing collections of information were approved by the Office of Management and Budget (OMB), approval numbers 3150-0010 and 3150-0136.

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

This action is a rule as defined in the Congressional Review Act (5 U.S.C. 801-808). However, the Office of Management and Budget has determined that it is not a “major rule” as defined by the Congressional Review Act.

Congress passed the Federal Civil Penalties Inflation Adjustment Act of 1990 (FCPIAA) to allow for regular adjustment for inflation of civil monetary penalties (CMPs), maintain the deterrent effect of such penalties and promote compliance with the law, and improve the collection of CMPs by the Federal government (Pub L. 101-410, 104 Stat. 890; 28 U.S.C. 2461 note). Pursuant to this authority, and as amended by the Debt Collection Improvement Act of 1996 (Pub. L. 104-34, 110 Stat. 1321-373), the NRC increased via rulemaking the CMP amounts for violations of the Atomic Energy Act of 1954, as amended (AEA) (codified at § 2.205 of title 10 of the Code of Federal Regulations (10 CFR), “Civil penalties”) and Program Fraud Civil Remedies Act (codified at § 13.3, “Civil penalties and assessments”) on four occasions between 1996 and 2008. 1

On November 2, 2015, Congress amended the FCPIAA through the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (2015 Improvements Act) (Sec. 701, Pub. L. 114-74, 129 Stat. 599). The 2015 Improvements Act required that the head of each agency perform an initial “catch-up” adjustment via rulemaking, adjusting the CMPs enforced by that agency according to the percentage change in the Consumer Price Index (CPI) between the month of October 2015 and the month of October of the calendar year when the CMP amount was last established by Congress. The NRC published this catch-up rulemaking on July 1, 2016 (81 FR 43019).

The 2015 Improvements Act also requires that the head of each agency continue to adjust CMP amounts, rounded to the nearest dollar, on an annual basis. Specifically, each CMP is to be adjusted based on the percentage change between the CPI for the month of October, and the CPI for the month of October for the previous year. The NRC most recently adjusted its civil penalties for inflation according to this statutory formula on January 13, 2023 (88 FR 2188). This year's adjustment is based on the increase in the CPI from October 2022 to October 2023.

Section 234 of the AEA limits civil penalties for violations of the AEA to $100,000 per day, per violation (42 U.S.C. 2282). However, as discussed in Section I, “Background,” of this document, the NRC has increased this amount several times since 1996 per the FCPIAA, as amended. Using the formula in the 2015 Improvements Act, the $351,424 amount last established in January 2023 will increase by 3.241 percent, resulting in a new CMP amount of $362,814. This is based on the increase in the CPI from October 2022 (298.012) to October 2023 (307.671). Therefore, the NRC is amending § 2.205 to reflect a new maximum CMP under the AEA in the amount of $362,814 per day, per violation. This represents an increase of $11,390.

Monetary penalties under the Program Fraud Civil Remedies Act were established in 1986 at $5,000 per claim (Pub. L. 99-509, 100 Stat. 1938; 31 U.S.C. 3802). The NRC also has adjusted this amount (currently set at $13,508) multiple times pursuant to the FCPIAA, as amended, since 1996. Using the formula in the 2015 Improvements Act, the $13,508 amount last established in January 2023 will also increase by 3.241 percent, resulting in a new CMP amount of $13,946. Therefore, the NRC is amending § 13.3 to reflect a new maximum CMP amount of $13,946 per claim or statement. This represents an increase of $438.

As permitted by the 2015 Improvements Act, the NRC may apply these increased CMP amounts to any penalties assessed by the agency after the effective date of this final rule (January 15, 2024), regardless of whether the associated violation occurred before or after this date (Pub. L. 114-74, 129 Stat. 600; 28 U.S.C. 2461 note). The NRC assesses civil penalty amounts for violations of the AEA based on the class of licensee and severity of the violation, in accordance with the NRC Enforcement Policy, which is available under ADAMS Accession No. ML23333A447. A corresponding update to the NRC Enforcement Policy is being published today in the Rules section of the Federal Register to reflect the updated CMP amount in § 2.205.

The 2015 Improvements Act expressly exempts this final rule from the notice and comment requirements of the Administrative Procedure Act by directing agencies to adjust CMPs for inflation “notwithstanding section 553 of title 5, United States Code” (Pub. L. 114-74, 129 Stat. 599; 28 U.S.C. 2461 note). As such, this final rule is being issued without prior public notice or opportunity for public comment, with an effective date of January 12, 2024.

This final rule revises paragraph (j) by replacing “$351,424” with “$362,814.”

This final rule revises paragraphs (a)(1)(iv) and (b)(1)(ii) by replacing “$13,508” with “$13,946.”

This final rule adjusts for inflation the maximum CMPs the NRC may assess under the AEA and under the Program Fraud Civil Remedies Act of 1986. The formula for determining the amount of the adjustment is mandated by Congress in the FCPIAA, as amended by the 2015 Improvements Act (codified at 28 U.S.C. 2461 note). Congress passed this legislation on the basis of its findings that the power to impose monetary civil penalties is important to deterring violations of Federal law and furthering the policy goals of Federal laws and regulations. Congress has also found that inflation diminishes the impact of these penalties and their effect. The principal purposes of this legislation are to provide for adjustment of civil monetary penalties for inflation, maintain the deterrent effect of civil monetary penalties, and promote compliance with the law. Therefore, these are the anticipated impacts of this rulemaking. Direct monetary impacts fall only upon licensees or other persons subjected to NRC enforcement for violations of the AEA and regulations and orders issued under the AEA (§ 2.205), or those licensees or persons subjected to liability pursuant to the provisions of the Program Fraud Civil Remedies Act of 1986 (31 U.S.C. 3801-3812) and the NRC's implementing regulations (10 CFR part 13).

The Regulatory Flexibility Act does not apply to regulations for which a Federal agency is not required by law, including the rulemaking provisions of the Administrative Procedure Act, 5 U.S.C. 553(b), to publish a general notice of proposed rulemaking (5 U.S.C. 604). As discussed in this notice under Section III, “Rulemaking Procedure,” of this document, this final rule is exempt from the requirements of 5 U.S.C. 553(b) and notice and comment need not be provided. Accordingly, the NRC also determines that the requirements of the Regulatory Flexibility Act do not apply to this final rule.

The NRC has not prepared a backfit analysis for this final rule. This final rule does not involve any provision that would impose a backfit, nor is it inconsistent with any issue finality provision, as those terms are defined in 10 CFR chapter I. As mandated by Congress, this final rule increases CMP amounts for violations of already-existing NRC regulations and requirements. This final rule does not modify any licensee systems, structures, components, designs, approvals, or procedures required for the construction or operation of any facility.

The Plain Writing Act of 2010 (Pub. L. 111-274) requires Federal agencies to write documents in a clear, concise, and well-organized manner. The NRC has written this document to be consistent with the Plain Writing Act as well as the Presidential Memorandum, “Plain Language in Government Writing,” published June 10, 1998 (63 FR 31885).

The NRC has determined that this final rule is the type of action described as a categorical exclusion in § 51.22(c)(1). Therefore, neither an environmental impact statement nor an environmental assessment has been prepared for this final rule.

This final rule does not contain a collection of information as defined in the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ) and, therefore, is not subject to the requirements of the Paperwork Reduction Act of 1995.

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

For the reasons set out in the preamble and under the authority of the Atomic Energy Act of 1954, as amended; the Energy Reorganization Act of 1974, as amended; 28 U.S.C. 2461 note; and 5 U.S.C. 552 and 553, the NRC is adopting the following amendments to 10 CFR parts 2 and 13:

The Federal Civil Penalties Inflation Adjustment Act of 1990, 28 U.S.C. 2461 note (“FCPIA Act”), requires federal agencies to adjust, by regulation, the CMPs within their jurisdiction to account for inflation. The Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (the “2015 Act”)  1 amended the FCPIA Act to require federal agencies to make annual adjustments not later than January 15 of every year. 2 The Board is now issuing a new final rule to set the CMP levels pursuant to the required annual adjustment for 2024. The Board will apply these adjusted maximum penalty levels to any penalties assessed on or after [publication date], whose associated violations occurred on or after November 2, 2015. Penalties assessed for violations occurring prior to November 2, 2015, will be subject to the amounts set in the Board's 2012 adjustment pursuant to the FCPIA Act. 3

Under the 2015 Act, the annual adjustment to be made for 2024 is the percentage by which the Consumer Price Index for the month of October 2023 exceeds the Consumer Price Index for the month of October 2022. On December 19, 2023, as directed by the 2015 Act, the Office of Management and Budget (OMB) issued guidance to affected agencies on implementing the required annual adjustment which included the relevant inflation multiplier. 4 Using OMB's multiplier, the Board calculated the adjusted penalties for its CMPs, rounding the penalties to the nearest dollar. 5

The 2015 Act states that agencies shall make the annual adjustment “notwithstanding section 553 of title 5, United States Code.” Therefore, this rule is not subject to the provisions of the Administrative Procedure Act (the “APA”), 5 U.S.C. 553, requiring notice, public participation, and deferred effective date.

The Regulatory Flexibility Act, 5 U.S.C. 601 et seq., requires a regulatory flexibility analysis only for rules for which an agency is required to publish a general notice of proposed rulemaking. Because the 2015 Act states that agencies' annual adjustments are to be made notwithstanding section 553 of title 5 of United States Code—the APA section requiring notice of proposed rulemaking—the Board is not publishing a notice of proposed rulemaking. Therefore, the Regulatory Flexibility Act does not apply.

There is no collection of information required by this final rule that would be subject to the Paperwork Reduction Act of 1995, 44 U.S.C. 3501 et seq.

For the reasons set forth in the preamble, the Board amends 12 CFR part 263 to read as follows:

The objective of this regulation is to adjust the maximum CMPs for inflation through a final rulemaking to retain the deterrent effect of such penalties.

The Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Debt Collection Improvement Act of 1996 (1996 Act) and the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (2015 Act) (collectively, 1990 Act, as amended), requires all Federal agencies with the authority to enforce CMPs to evaluate and adjust, if necessary, those CMPs each year to ensure that they continue to maintain their deterrent value and promote compliance with the law. Section 3(2) of the 1990 Act, as amended, defines a civil monetary penalty  1 as any penalty, fine, or other sanction that: (1) either is for a specific monetary amount as provided by Federal law or has a maximum amount provided for by Federal law; (2) is assessed or enforced by an agency pursuant to Federal law; and (3) is assessed or enforced pursuant to an administrative proceeding or a civil action in the Federal courts. 2

The FCA imposes and enforces CMPs through the Farm Credit Act  3 and the FDPA, as amended. 4 FCA's regulations governing CMPs are found in 12 CFR parts 622 and 623. Part 622 establishes rules of practice and procedure applicable to formal and informal hearings held before the FCA, and to formal investigations conducted under the Farm Credit Act. Part 623 prescribes rules regarding persons who may practice before the FCA and the circumstances under which such persons may be suspended or debarred from practice before the FCA.

Section 5.32(a) of the Farm Credit Act provides that any Farm Credit System (System) institution or any officer, director, employee, agent, or other person participating in the conduct of the affairs of a System institution who violates the terms of an order that has become final pursuant to section 5.25 or 5.26 of the Farm Credit Act must pay a maximum daily amount of $1,000, 5 for each day such violation continues. This CMP maximum was set by the Farm Credit Amendments Act of 1985, which amended the Farm Credit Act. Orders issued by the FCA under section 5.25 or 5.26 of the Farm Credit Act include temporary and permanent cease-and-desist orders. In addition, section 5.32(h) of the Farm Credit Act provides that any directive issued under sections 4.3(b)(2), 4.3A(e), or 4.14A(i) of the Farm Credit Act “shall be treated” as a final order issued under section 5.25 of the Farm Credit Act for purposes of assessing a CMP.

Section 5.32(a) of the Farm Credit Act also states that “[a]ny such institution or person who violates any provision of the [Farm Credit] Act or any regulation issued under this Act shall forfeit and pay a civil penalty of not more than $500  6 per day for each day during which such violation continues.” This CMP maximum was set by section 423 of the Agricultural Credit Act of 1987, which was enacted in 1988 and amended the Farm Credit Act. Current inflation-adjusted CMP maximums are set forth in existing § 622.61 of FCA regulations. 7

The FCA also enforces the FDPA, as amended, which requires FCA to assess CMPs for a pattern or practice of committing certain specific actions in violation of the National Flood Insurance Program. The FDPA states that the maximum CMP for a violation of that Act is $2,000. 8 9

The 2015 Act required all Federal agencies to adjust the CMPs yearly, starting January 15, 2017.

Under Section 4(b) of the 1990 Act, as amended, annual adjustments are to be made no later than January 15. 10 Section 6 of the 1990 Act, as amended, states that any increase to a civil monetary penalty under this 1990 Act applies only to civil monetary penalties, including instances in which an associated violation predated the annual increase, which are assessed after the date the increase takes effect.

Section 5(b) of the 1990 Act, as amended, defines the term “cost-of-living adjustment” as the percentage (if any) for each civil monetary penalty by which (1) the Consumer Price Index (CPI) for the month of October of the calendar year preceding the adjustment, exceeds (2) the CPI for the month of October one year before the month of October referred to in (1) of the calendar year in which the amount of such civil monetary penalty was last set or adjusted pursuant to law. 11

The increase for each CMP adjusted for inflation must be rounded using a method prescribed by section 5(a) of the 1990 Act, as amended, by the 2015 Act. 12

If a civil monetary penalty is subject to a cost-of-living adjustment under the 1990 Act, as amended, but is adjusted to an amount greater than the amount of the adjustment required under the Act within the 12 months preceding a required cost-of-living adjustment, the agency is not required to make the cost-of-living adjustment to that CMP in that calendar year. 13

The adjustment requirement affects two provisions of section 5.32(a) of the Farm Credit Act. For the 2024 yearly adjustments to the CMPs set forth by the Farm Credit Act, the calculation required by the 2023 White House Office of Management and Budget (OMB) guidance  14 is based on the percentage by which the CPI for October 2023 exceeds the CPI for October 2022. The OMB set forth guidance, as required by the 2015 Act, 15 with a multiplier for calculating the new CMP values. 16 The 2023 OMB multiplier for the 2024 CMPs is 1.03241.

The adjustment also affects the CMPs set by the Flood Disaster Protection Act of 1973, as amended. The adjustment multiplier is the same for all FCA enforced CMPs, set at 1.03241. The maximum CMPs for violations were created in 2012 by the Biggert-Waters Act, which amended the Flood Disaster Protection Act of 1973.

The inflation-adjusted CMP currently in effect for violations of a final order occurring on or after January 15, 2023, is a maximum daily amount of $2,741. 17 Multiplying the $2,741 CMP by the 2023 OMB multiplier, 1.03241, yields a total of $2,829.84. When that number is rounded as required by section 5(a) of the 1990 Act, as amended, the inflation-adjusted maximum increases to $2,830. Thus, the new CMP maximum is $2,830, for violations that occur on or after January 15, 2024.

The inflation-adjusted CMP currently in effect for violations of the Farm Credit Act or regulations issued under the Farm Credit Act occurring on or after January 15, 2023, is a maximum daily amount of $1,240. 18 Multiplying the $1,240 CMP maximum by the 2023 OMB multiplier, 1.03241, yields a total of $1,280.19. When that number is rounded as required by section 5(a) of the 1990 Act, as amended the inflation-adjusted maximum increases to $1,280. Thus, the new CMP maximum is $1,280, for violations that occur on or after January 15, 2024.

The existing maximum CMP for a pattern or practice of flood insurance violations pursuant to 42 U.S.C. 4012a(f)(5) occurring on or after January 15, 2023, is $2,577. Multiplying $2,577 by the 2023 OMB multiplier, 1.03241, yields a total of $2,660.52. When that number is rounded as required by section 5(a) of the 1990 Act, as amended, the new maximum assessment of the CMP for violating 42 U.S.C. 4012a(f)(5) is $2,661. Thus, the new CMP maximum is $2,661, for violations that occur on or after January 15, 2024.

Section 4(b)(2) of the 1990 Act, as amended by section 701 of the 2015 Act (28 U.S.C. 2461 note), provides an exemption from the Administrative Procedure Act notice and comment requirements in 5 U.S.C. 553. Further, these revisions are ministerial, technical, and noncontroversial. For these reasons, the FCA has determined to adopt this rule in final form.

Pursuant to section 605(b) of the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ), the FCA hereby certifies that this final rule will not have a significant economic impact on a substantial number of small entities. Each of the banks in the System, considered together with its affiliated associations, has assets and annual income in excess of the amounts that would qualify them as small entities. Therefore, System institutions are not “small entities” as defined in the Regulatory Flexibility Act.

For the reasons stated in the preamble, part 622 of chapter VI, title 12 of the Code of Federal Regulations is amended to read as follows:

Wing Aviation LLC (Wing) applied to the FAA on September 19, 2018, for a special class type certificate (TC) under 14 CFR 21.17(b) for the Model Hummingbird UA.

The Model Hummingbird consists of a fixed-wing airplane UA and its associated elements (AE) including communication links and components that control the UA. The Model Hummingbird UA has a maximum gross takeoff weight of approximately 15 pounds. It is approximately 3.4 feet in width, 4.2 feet in length, and 9.4 inches in height. The Model Hummingbird UA is battery powered using electric motors for vertical takeoff, landing, and forward flight. The unmanned aircraft system (UAS) operations would rely on high levels of automation and may include multiple UA operated by a single pilot, up to a ratio of 20 UA to 1 pilot. Wing intends for the Model Hummingbird to be used to deliver packages. The proposed concept of operations (CONOPS) for the Model Hummingbird includes a maximum operating altitude of 400 feet above ground level, a maximum cruise speed of 68 knots, operations beyond visual line of sight (BVLOS), and operations over people (OOP). Wing has not requested approval for flight into known icing for the Model Hummingbird UA.

Under § 21.17(c), an application for type certification is effective for 3 years. Section 21.17(d) provides that where a TC has not been issued within that 3-year time limit, the applicant may file for an extension and update the designated applicable regulations in the type certification basis. The effective date of the applicable airworthiness requirements for the updated type certification basis must not be earlier than 3 years before the date of issue of the TC. Since the project was not certificated within 3 years after the application date above, the FAA approved the applicant's request to extend the application for type certification. As a result, the date of the updated type certification basis is September 26, 2022.

The FAA issued a notice of proposed airworthiness criteria for the Wing Model Hummingbird UA, which published in the Federal Register on February 8, 2023 (88 FR 8333).

The FAA received responses from 5 commenters. The comments came from industry organizations such as the Air Line Pilots Association (ALPA), the Association for Uncrewed Vehicle Systems International (AUVSI), the Small Unmanned Aerial Vehicles (UAV) Coalition, the Commercial Drone Alliance, and Wing Aviation LLC.

D&R.100 UA Signal Monitoring and Transmission: The FAA proposed criteria on the minimum types of information the FAA finds are necessary for the UA to transmit to the AE for continued safe flight and operation.

Comment Summary: ALPA is concerned with the possibility of cyber security breaches that could allow unauthorized individuals to take control of a UA, potentially leading to safety issues. As such, it is important to address these concerns and establish an acceptable envelope of tolerance for UA operation that ensures the security of the signal monitoring and transmission systems.

FAA Response: These comments are outside the scope for D&R.100. The comments by ALPA on cyber security, D&R.115, are addressed in the following paragraph.

D&R.115 Cyber Security: The FAA proposed a requirement to address the risks to the UA associated with intentional unauthorized electronic interactions that may result in an adverse effect on the security or airworthiness of the UA.

Comment Summary: ALPA is concerned with the safety and security of the Command and Control (C2) link and potential unauthorized intrusions that could result in the loss of full control over the aircraft. ALPA recommends that every UA model requesting operations in the National Airspace System (NAS) undergo testing and validation during the aircraft certification process to ensure the security of the C2 link is impenetrable and cannot be hacked. ALPA states that reports have shown that the loss of the C2 link and the inability to regain it has led to an uncontained flyaway. ALPA focuses on the most critical aspects of safe UA operations and recommends specific requirements to ensure the safe discontinuation of a flight after a failure of a critical part or system and/or unauthorized intrusion of the C2 link. Other recommendations include the ability of the pilot to re-route the UA safely and dynamically, the ability for the UA control station to allow the pilot to intervene in the management of the flight, an established parameter requirement for geo-fencing specifications, and a requirement for the UA to possess the capability to detect and avoid other aircraft and hazards that are human made/manufactured and natural.

FAA Response: The proposed recommendations are too specific for this general airworthiness criteria language; the language already covers the general issues that ALPA's specific recommendations seek to address. D&R.115 states that the UA equipment, systems, and networks must be assessed to identify and mitigate protections as necessary. The level of detail regarding the assessment of failures and the required protection level of equipment, systems, and networks will be addressed in the means of compliance (MOC) to these airworthiness criteria. The C2 link is addressed in the airworthiness criteria under D&R.120 Contingency Planning for a C2 lost link or degradation of a C2 link, as well as performance requirements. The C2 link is considered part of the UA and will be assessed for cyber security under D&R.115 as part of equipment and systems.

D&R.120 Contingency Planning: The FAA proposed a requirement to address the risks associated with loss of communication C2 link between the pilot and the UA. The proposed criteria requires that the UA be designed to automatically execute a predetermined action and include the predetermined action in the UA Flight Manual. The UA Flight Manual must also include the minimum performance requirements for the C2 data link defining when the C2 link is degraded to a level where active control is no longer ensured. Takeoff when the C2 link is degraded below minimum performance requirements must be prevented by design or by an operating limitation to be included in the UA Flight Manual.

Comment Summary: ALPA expressed several areas of concern related to UA contingency planning that the FAA should consider during the aircraft certification process. These concerns include addressing the risks associated with loss of communication, defining detailed preprogrammed algorithmic deliverables and corrective actions for each situation, and ensuring that the UA can automatically execute a safe predetermined flight, loiter landing, or termination in the event of any critical parts or systems failures. ALPA has several recommendations including to have the applicant “Develop a detailed narrative that outlines every possible action that the UA will execute when guidance/intrusion challenges arise after the first preterminal action is initiated with the flight of the aircraft until all maneuvering actions have been exhausted and no further options exist.” ALPA also recommends a test and validation of the effectiveness of the pre-determined executable actions to ensure proper design and definition of UA as intended.

FAA Response: The FAA shares ALPA's concerns and has determined that the current airworthiness criteria appropriately address these concerns. The airworthiness criteria within D&R.120(a) propose the automatic and immediate execution of a safe predetermined action, in the event of a loss of communications, be part of the UA design. Furthermore, D&R.120(b) proposes that established predetermined actions are included in the UA Flight Manual, thus ensuring the applicant outlines these predetermined maneuvering actions within their contingency planning. Test and validation methods, of the effectiveness of such pre-determined actions as part of mitigation planning by which the UA will meet these criteria are addressed by D&R.310(a) and will be outlined in the MOC.

D&R.125 Lightning: The FAA proposed criteria to address the risks that would result from a lightning strike, accounting for the size and physical limitations of a UAS that could preclude traditional lightning protection features. The FAA further proposed that without lightning protection for the UA, the flight manual must include an operating limitation to prohibit flight into weather conditions with potential lightning.

Comment Summary: ALPA commented that lightning can cause significant damage to aircraft and pose a safety risk to people and property on the ground if that aircraft were to lose control and crash. ALPA suggests 10 specific recommendations for the FAA such as developing lightning protection standards and procedures; establishing a certification process for UA lightning protection and requiring all UA to comply with those standards; requiring regular inspections to identify damage caused by lightning strikes; and developing training programs for UA operators and maintenance personnel on lightning safety.

FAA Response: The proposed recommendations are too specific for this general airworthiness criteria language. The UA, if designed with lightning mitigation features per D&R.125(a), would need to demonstrate protection of the UA from loss of flight or control due to lightning within the MOC. Otherwise, the operational limitations per D&R.125(b) would prohibit flight into weather conditions conducive to lightning activity.

D&R.130 Adverse Weather Conditions: The FAA proposed criteria either requiring that design characteristics protect the UAS from adverse weather conditions or prohibiting flight into known adverse weather conditions. The criteria proposed to define adverse weather conditions as rain, snow, and icing.

Comment Summary: ALPA recommends that the FAA develop and implement a policy that covers scenarios beyond “known conditions” when UAs inadvertently experience adverse weather conditions. ALPA suggests 30 specific recommendations including establishing training requirements for UA pilots and crew members on managing adverse weather conditions; requiring that UA operators have access to accurate and up-to-date weather information; requiring continuous monitoring of adverse weather conditions during flight operations; establishing strict icing requirements and tolerances to prevent the operation of the UA in icing conditions; establishing strict wind limitations and protocols; and that UA operators adapt air carrier icing standards or use them as a baseline to ensure safe operations.

FAA Response: Scenarios beyond “known conditions” would be an anomalous situation that is beyond the scope of D&R.130. For adverse weather conditions for which the UA is not approved to operate, D&R.130 already contains requirements to detect adverse weather and minimize the likelihood of operating in those conditions. Testing of operations in these conditions is beyond the level of rigor needed for these aircraft. In addition, the effect of wind is addressed in D&R.300(b)(9), even though it is not included in D&R.130. D&R testing MOCs and test plans will ensure the UA is tested for adverse wind conditions. Design requirements related to operation in icing as a result of adverse weather are addressed in the CONOPS as stated within D&R.130(b).

D&R.135 Flight Essential Parts: The FAA proposed criteria for critical parts that were substantively similar to those in the existing standards for normal category rotorcraft under 14 CFR 27.602, with changes to reflect UAS terminology and failure conditions. The criteria proposed to define a critical part as a part, the failure of which could result in a loss of flight or unrecoverable loss of control of the aircraft.

Comment Summary: ALPA proposed several recommendations related to design and testing of the UA to consider the failure rates of associated systems and parts. ALPA recommends that a failure-rate threshold should be determined for critical components that are flight essential. ALPA recommends that the FAA establish stringent standards and guidelines for UA certification to ensure public safety.

FAA Response: The specific numerical reliability of any specific part is more specific than would appear in airworthiness D&R criteria. D&R.135(b) already requires the applicant to define maintenance instructions or life limits on any essential parts. Life limits are determined based on the number of failure-free hours flown on the highest time conformed aircraft and the life limits are listed in the instructions for continued airworthiness (ICA).

D&R.300 Durability and Reliability: The FAA proposed durability and reliability testing that would require the applicant to demonstrate safe flight of the UAS across the entire operational envelope and up to all operational limitations, for all phases of flight and all aircraft configurations described in the applicant's CONOPS, with no failures that result in a loss of flight, loss of control, loss of containment, or emergency landing outside the operator's recovery area. The FAA further proposed that UA would only be certificated for operations within the limitations, and for flight over areas no greater than the maximum population density, as described in the applicant's CONOPS and demonstrated by test.

Comment Summary: ALPA commented that it is crucial that UA operators understand the limitations and requirements for operating in visual line of sight (VLOS) and BVLOS environments, including recovery zone limitations. Additionally, proper maintenance and testing must be conducted to ensure the UA's airworthiness certificate is valid and reliable for operation. ALPA suggests 10 specific recommendations including requiring scheduled maintenance per 14 CFR part 43; specific minimum testing; and requiring regular system checks before each flight to ensure the aircraft is in proper working condition.

FAA Response: The D&R airworthiness criteria contain requirements related to the airworthiness of the aircraft itself, relying heavily on both flight testing and on maintenance in accordance with defined maintenance procedures. The comments on the operational environments are separate requirements or limitations and not part of the criteria for the aircraft itself. ALPA's specific maintenance recommendations are already encompassed by the general language of D&R.300.

Comment Summary: The Small UAV Coalition commented on the proposed D&R.300 requirement that no failures occur “that result in loss of flight, loss of control, loss of containment, or emergency landing outside the operator's recovery area.” The Coalition recommends that a single failure during testing should not automatically restart counting the number of flight test operations set for a particular population density. Rather, if the applicant can identify the failure through root cause and fault tree analysis and provide a validated mitigation to prevent its recurrence, the number of consecutive failure-free operations and overall flight test hours allocation should be adjusted to be proportionate to the particular risk of that failure.

The Small UAV Coalition also states, “some UAS design elements could include an onboard health system that initiates a landing to lessen the potential of a loss of control event. In those cases, if the landings could be demonstrated to occur in safer locations that should not count as a failure.” The Coalition seeks confirmation that the text “operator's recovery area” includes that sort of landing. Absent correction or clarification from the FAA on this language in D&R.300, the Coalition believes these requirements would present unnecessary and overly burdensome compliance challenges for the applicant to address.

FAA Response: The intent of the testing criteria is for the applicant to demonstrate the aircraft's durability and reliability through a successful accumulation of flight testing. The FAA does not expect analytical evaluation to be part of this process. It should be noted that D&R.300 is intended to demonstrate the reliability of the system and not the consequence of failure, which is addressed in D&R.305. Systems designed to allow for unscheduled landings at potentially safer sites which are not controlled by the operator may provide a safety benefit, but D&R.300 is evaluating the overall system reliability and any landing outside those sites predetermined and accepted by the FAA in the flight test plan will be considered a test point failure. Failures during flight testing may or may not require additional test hours, up to and including resetting of the accumulated flight hours to zero. This determination will be made by the FAA based on the extent of redesign necessary to minimize the likelihood the incident will recur. However, the applicant will comply with these testing criteria using an MOC, accepted by the FAA, through the issue paper process. The MOC will depend on the reliability level the applicant has proposed to meet.

D&R.305 Probable Failures: The FAA proposed criteria to evaluate how the UAS functions after probable failures, including failures related to propulsion systems, C2 link, global positioning system (GPS), critical flight control components with a single point of failure, control station, and any other equipment identified by the applicant.

Comment Summary: ALPA provided 10 recommendations to ensure that the testing criteria effectively address probable failures and that any additional critical failures are also considered. Some of the recommendations include the FAA specifying which “certain failures” that UAs will be expected to demonstrate to prove that they can remain under control and contained; the UA should be tested to ensure it can safely return to a predetermined location or land safely in the event of a loss of power or propulsion system failure; and the applicant should test the UA's ability to detect and avoid potential obstacles, such as other aircraft, buildings, or terrain, to ensure safe operations in all types of environments.

FAA Response: “Probable failures” are addressed in D&R.305 and “capabilities” are addressed within D&R.310. The intent of the testing criteria is for the applicant to demonstrate the aircraft's durability and reliability through a successful accumulation of flight testing. The FAA does not expect analytical evaluation to be part of this process. However, the applicant will comply with these testing criteria using test plans developed to an MOC, accepted by the FAA through the issue paper process. The MOC will address each element of these airworthiness criteria and will be dependent on the reliability level the applicant has proposed to meet.

D&R.310 Capabilities and Functions: The FAA proposed criteria to require the applicant to demonstrate, by test, the minimum capabilities and functions necessary for the design. UAS.310(a) proposed to require the applicant to demonstrate, by test, the capability of the UAS to regain command and control of the UA after a C2 link is lost, the sufficiency of the electrical system to carry all anticipated loads, and the ability of the pilot to override any pre-programming in order to resolve a potential unsafe operating condition in any phase of flight. UAS.310(b) proposed to require the applicant to demonstrate, by test, certain features if the applicant requests approval of those features (geo-fencing, external cargo, detect and avoid, etc.). UAS.310(c) proposed to require the design of the UAS to safeguard against an unintended discontinuation of flight or release of cargo, whether by human action or malfunction.

Comment Summary: ALPA comments on assuring the security of the C2 link through testing and validation during the aircraft certification process for every UA model requesting operations in the NAS. An acceptable percentage for cyber intrusions and the ability to regain command and control of the UA after the C2 link is lost must be defined. ALPA also provided several recommendations on capabilities and functions required by D&R.310(a) or optional D&R.310(b), if requested for approval.

FAA Response: D&R.120(a) requires contingency planning for C2 lost link and D&R.115 requires protections from cyber intrusions. Specific contingency plans and protections will be addressed in the MOC for those airworthiness criteria. D&R.310's general airworthiness criteria language already covers the other issues ALPA's specific recommendations seek to address.

Comment Summary: The proposed airworthiness criteria discussion of D&R.310 “Capabilities and Functions” includes the sentence, “[i]n order to show that the UA does not create a hazard when landing, the UA must show by test that it has the ability to detect and avoid any potential hazards on the ground by demonstrating any such landing always stays well clear of all people and other obstacles.”

Wing, AUVSI, The Commercial Drone Alliance and The Small UAV Coalition object to the FAA's use of absolute terms such as “any” and “always” against undefined and/or ambiguous terms (such as “well clear” in the context of ground obstacles) outlined in the preamble discussion of the proposed airworthiness criteria. Absent correction or clarification by the FAA, the commenters state that this language sets an impossibly high standard beyond the capabilities of either human or machine. Such absolute and prescriptive MOC is inappropriate in the context of airworthiness criteria. Wing is concerned that this standard precludes the ability of Wing or other manufacturers to demonstrate compliance at any practical level of test or validation. The commenters note that this standard is not called for in the actual proposed text of D&R.310 itself. In finalizing the airworthiness criteria, the FAA should correct or clarify its preamble language to avoid any possible confusion.

Wing is concerned that the absolute terms “any” and “always” create a bar that demonstration by test or other means cannot meet. In addition, the use of terms such as “potential” and “well clear” similarly creates substantial challenges to compliance demonstration by test or other means. Wing states that it would be exceptionally challenging to meet this standard and that it exceeds the expectations for crewed aircraft as written. Wing requests that the FAA allow for alternative means of demonstrating that the UA does “not create a hazard when landing” in accordance with D&R.310(a)(6) by prefacing this paragraph with the phrase “for example;” remove the absolute terms “any,” “all,” and “always” to allow for the use of reasonable and achievable test methods; and remove the undefined and ambiguous terms “well clear,” “other obstacles,” and “potential” when outlining test or demonstration criteria.

FAA Response: The FAA's use of absolute terms referenced in the comment summary above are of concern to Wing and others as in their view, “the language sets an impossibly high standard beyond the capabilities of either human or machine.” The subject language is based on the increased level of automation of Wing's system, which relies on onboard automated decision-making rather than pilot action. To accept such a system, the UAS must exhibit highly automated features and functions to enhance the safety of UAS operations by replacing direct manual control of the UA with automation. The UAS's automated flight envelope and path protection systems must be designed for controllability and maneuverability needed to detect and to maintain safe separation from hazards or obstacles on or near the ground while in normal, abnormal, and emergency operations. Some examples of abnormal or emergency scenarios include collision avoidance, aborted missions, power system failures, and forced landings. The UAS must also be equipped with capabilities and necessary features that will automatically contain or control the aircraft in the case of a loss of external services used in communicating, controlling, or providing system inputs to the UA. All foreseeable loss, degradation or non-availability of external services, systems, or signals must not put the UA in an uncontrolled, uncontained, or unsafe condition.

D&R.310 is a testing requirement and sets the criteria which must be demonstrated by flight test as part of the type certification program. The language referenced by the commenters as preamble language does not appear in the final rule but is given in the discussion section of the NPRM as a tool for understanding why the requirement was drafted as it was and provides additional insight into the means by which the applicant will be able to show compliance with the testing requirements in D&R.310. The intent of the use of this language within the NPRM discussion is for the applicant to show compliance by demonstrating landings that do not adversely impact people or obstacles. Therefore, the FAA finds that an acceptable flight test outcome is one that would not result in an unsafe condition. Within the context of the certification testing performed under D&R.310, the FAA's use of absolute terms such as “any” and “always” only serve to emphasize acceptable examples of test boundaries which will be addressed in more detail in the MOC and test plans. Likewise, terms like “well clear” will be defined based on the appropriate near mid-air collision (NMAC) volume determined to be acceptable to the FAA for the D&R flight test campaign.

D&R.320 Verification of Limits: The FAA proposed to require a demonstration of the UA's performance, maneuverability, stability, and control with a factor of safety (5% over maximum gross weight with no loss of control or loss of flight).

Comment Summary: ALPA is concerned that the safety factor of 5% is too low. The Model Hummingbird UA weighs approximately 15 lbs., which means that 5% is approximately 0.75 lbs. ALPA recommends increasing this number to a minimum of a double-digit percentage for current and future aircraft certification standards.

FAA Response: The FAA determined that based on historical data, 5% is a minimum acceptable margin.

UA to Pilot Ratio: The Wing Model Hummingbird UAS operations would rely on high levels of automation and may include multiple UA operated by a single pilot, up to a ratio of 20 UA to 1 pilot.

Comment Summary: ALPA is concerned with the safe operation of multiple UAs operated by a single pilot as described within the proposed airworthiness criteria notice. ALPA recommends that the FAA research and better assess multiple UA operations by a single pilot to establish a baseline understanding of the feasibility of a single UA pilot flying multiple UAs before developing airworthiness certification criteria. The proposed 20 to 1 UA to pilot ratio presents significant challenges to ensuring the safe operation of UAs and other NAS users, and the FAA should implement additional certification requirements for pilots operating multiple UAs, including specialized training and qualification standards. Additionally, the FAA should establish guidelines for the maximum number of UAs that a single pilot can operate to ensure safe and effective operations in the NAS. Furthermore, there should always be a backup failsafe and tertiary means of control for built-in redundancy where another human operator can intervene out of necessity for safety. The FAA should base its decision on facts and data and should clarify what qualitative and quantitative scientific instruments were utilized to assess the potential risks of the aircraft.

FAA Response: These airworthiness criteria require the applicant to demonstrate the durability and reliability of the UA design by flight test, at the highest aircraft-to-pilot ratio, without exceptional piloting skill or alertness. In addition, D&R.305(c) requires the applicant to demonstrate probable failures by test at the highest aircraft-to-pilot ratio. The durability and reliability-based type certification process was developed for UAS that meet certain design criteria to include a maximum operating limitation of 20:1 aircraft to pilot ratio. Any deviation from this limitation will require additional coordination and will add to the project timeline.

Level of Automation: The Wing Model Hummingbird UA operations would rely on high levels of automation.

Comment Summary: ALPA is concerned about the specificity of the Model Hummingbird UA's automation level. ALPA states that the FAA should clarify the degree and level of automation in which the UA will operate. This includes defining whether the operation of the Model Hummingbird UA will be fully automated autonomous, partially automated autonomous, preprogrammed, or a combination of any of these options. Additionally, the FAA should determine the required minimal involvement or participation from the remote pilot(s) to assure flight safety. ALPA suggests that the FAA establish guidelines for aircraft onboard (organic) and/or offboard (inorganic) intelligence system(s) to deconflict other known and unknown (birds, floating objects/flying debris) air traffic and associated hazards. The FAA should ensure that these systems are tested, designed, and manufactured to a certain failure rate, such as a 10 −9 failure rate per flight hours or something less.

FAA Response: D&R.100 requires UA specifications within the CONOPS. Data within the CONOPS are proprietary to the applicant. The D&R methodology is used as a framework to allow for an adequate balance of certification rigor with safety related outcomes. The FAA considered the size of aircraft, its maximum airspeed and altitude, and operational limitations to address the number of UA per operator (maximum of 20:1 aircraft to pilot ratio) and to address operations in which the aircraft would operate BVLOS of the pilot to assess the potential risk the aircraft could pose to other aircraft and to human beings on the ground. Using these parameters, the FAA developed proposed airworthiness criteria to address those potential risks to ensure the aircraft remains reliable, controllable, safe, and airworthy without the need for requiring a prescriptive failure rate.

Comment Summary: ALPA is concerned that the carriage of HAZMAT by UAs over populated areas poses a significant safety concern requiring the FAA's action. The guidelines and regulations for the carriage of HAZMAT by UAs should consider the associated risks to public safety. UA operators should be required to provide information about the HAZMAT they are carrying. The FAA should also establish a system for monitoring and enforcing compliance, ensure that emergency responders are informed, properly trained, and equipped to handle nonconventional operational factors involving UA HAZMAT incidents, and require UA manufacturers to incorporate safeguards and emergency response mechanisms. By taking these and other recommended steps, the FAA can help ensure the safe operation of UAs in the NAS.

FAA Response: The FAA acknowledges the concern by ALPA. However, the comment is not within the scope of the aircraft type certification for which this airworthiness criteria was developed. The carriage of HAZMAT is an operational function and if applicable to Wing's operation for this aircraft, would be provided in the CONOPS. The CONOPS, if approved for HAZMAT, will contain operational limitations in the operating approval, as necessary. The CONOPS are proprietary to the applicant.

Comment Summary: ALPA is concerned that as the use of UAs for BVLOS operations and over people become increasingly common, it raises significant safety concerns that must be addressed in the certification process. ALPA is concerned about the potential risks associated with this type of operation involving the Model Hummingbird UA or any similar operator. In order to ensure safety, ALPA recommends that operators explain how they plan to mitigate their aerial footprint around and away from people and property, with detailed evasion and emergency set-down plans, processes, and parameters. Additionally, ALPA urges the FAA to consider the possibility of an aircraft performing BVLOS losing propulsion and being unable to maintain flight, requiring a recovery or crash mitigation strategy and emergency vertical arrestment system to prevent harm to persons or property.

ALPA states that many manufacturers within the UA/drone and urban air mobility (UAM) and advanced air mobility (AAM) industry do not include an emergency vertical arrestment system to prevent loss of life and property in the event of an aircraft losing its engine or engines then becoming a falling object which is increasingly alarming if that aircraft has minimal to a zero-glide aspect ratio. ALPA recommends continuous collaboration between industry experts and the regulator to develop safer aircraft design and certification standards for the best interests of the end-users, the flying public, and those affected by flight operations of UA/drone or UAM/AAM aircraft. When these types of aircraft operate in the same airspace as commercial aircraft, ALPA recommends that pilots have the ability to see them on the flightdeck or pilot display and air traffic controllers can view them on their displays to separate air traffic safely. These aircraft must also have active collision-avoidance technology, and ALPA opposes any integration that does not include aircraft collision-avoidance systems (ACAS) that are interoperable with commercial collision-avoidance systems. ALPA further opposes any proposed changes to 14 CFR 91.113 to enable BVLOS operational safety case(s) to transfer the responsibility of “see and avoid” to crewed aircraft under certain conditions. The responsibility of “see and avoid” must remain with the remote pilot, and any changes to this would be detrimental to the safe integration of UAs into the NAS.

FAA Response: Discussion on proposed changes to general operating flight rule § 91.113 is not within the scope of this airworthiness criteria as it does not pertain to the type certification of the aircraft itself. Operational approval will be granted based on the maximum cumulative risk posed by the proposed operations, taking into account mitigating features, e.g., vertical arresting systems such as parachutes, if they are proposed as part of the design. However, the airworthiness criteria are developed to be high level and performance based, rather than relying on specific designs which may limit introduction of other novel safety enhancing features.

Comment Summary: ALPA states that the use of batteries as an energy source for aircraft propulsion in the NAS is a substantial shift from traditional propulsion methods on which current safety margins are based and requires more regulator exploration to determine best safety practices. ALPA states that the FAA will need to analyze, qualify, and quantify the aircraft performance and operational environments to determine whether the safety baseline of this technological functionality can be performed reliably and repeatedly to an equivalent level of safety. ALPA recommends that the FAA and industry mutually agree upon the scientific data to confer consensus regarding acceptable safety margins.

ALPA provided 20 specific recommendations regarding battery safety. Some of the recommendations are to develop standards; establish certification procedures for aircraft batteries; develop regulations for transporting lithium-ion batteries; define policies and procedures for flightcrews to promptly act with an abnormal battery anomaly; and several more recommendations on best-practices for battery safety.

FAA Response: The recommendations on battery standards by the commenter are noted as either being too specific or out of scope for this D&R airworthiness criteria. The overly specific recommendations address issues already encompassed by the general airworthiness criteria. D&R testing per D&R.300 should demonstrate reliability of the UAS as a whole and thus each system or component within the UAS has met a minimum acceptable reliability standard. Demonstration of the safe carriage of batteries and mitigations for known risks are addressed via flight test within D&R.305(a)(1) “Propulsion systems.”

The FAA received and reviewed several comments that were general, stated the commenter's viewpoint or opposition without a suggestion specific to the proposed criteria, or did not make a request the FAA can act on. These comments are noted as beyond the scope of this document.

These airworthiness criteria, established under the provisions of § 21.17(b), are applicable to the Model Hummingbird UA. Should Wing Aviation LLC apply at a later date for a change to the TC to include another model, these airworthiness criteria would apply to that model as well, provided the FAA finds them appropriate in accordance with the requirements of subpart D to part 21.

This action affects only the airworthiness criteria for one model UA. It is not a standard of general applicability.

The authority citation for these airworthiness criteria is as follows:

Pursuant to the authority delegated to me by the Administrator, the following airworthiness criteria are issued as part of the type certification basis for the Wing Aviation LLC Model Hummingbird UA. The FAA finds that compliance with the following would mitigate the risks associated with the proposed design and CONOPS appropriately and would provide an equivalent level of safety to existing rules.

The applicant must define and submit to the FAA a concept of operations (CONOPS) proposal describing the UAS operation in the National Airspace System for which UA type certification is requested. The CONOPS proposal must include, at a minimum, a description of the following information in sufficient detail to determine the parameters and extent of testing and operating limitations:

(a) The intended type of operations;

(b) UA specifications;

(c) Meteorological conditions;

(d) Operators, pilots, and personnel responsibilities;

(e) Control station, support equipment, and other associated elements (AE) necessary to meet the airworthiness criteria;

(f) Command, control, and communication functions;

(g) Operational parameters (such as population density, geographic operating boundaries, airspace classes, launch and recovery area, congestion of proposed operating area, communications with air traffic control, line of sight, and aircraft separation); and

(h) Collision avoidance equipment, whether onboard the UA or part of the AE, if requested.

For purposes of these airworthiness criteria, the following definitions apply.

(a) Loss of control: Loss of control means an unintended departure of an aircraft from controlled flight. It includes control reversal or an undue loss of longitudinal, lateral, and directional stability and control. It also includes an upset or entry into an unscheduled or uncommanded attitude with high potential for uncontrolled impact with terrain. A loss of control means a spin, loss of control authority, loss of aerodynamic stability, divergent flight characteristics, or similar occurrence, which could generally lead to a crash.

(b) Loss of flight: Loss of flight means a UA's inability to complete its flight as planned, up to and through its originally planned landing. It includes scenarios where the UA experiences controlled flight into terrain, obstacles, or any other collision, or a loss of altitude that is severe or non-reversible. Loss of flight also includes deploying a parachute or ballistic recovery system that leads to an unplanned landing outside the operator's designated recovery zone.

The UA must be designed to monitor and transmit to the AE all information required for continued safe flight and operation. This information includes, at a minimum, the following:

(a) Status of all critical parameters for all energy storage systems;

(b) Status of all critical parameters for all propulsion systems;

(c) Flight and navigation information as appropriate, such as airspeed, heading, altitude, and location; and

(d) Communication and navigation signal strength and quality, including contingency information or status.

(a) The applicant must identify and submit to the FAA all AE and interface conditions of the UAS that affect the airworthiness of the UA or are otherwise necessary for the UA to meet these airworthiness criteria. As part of this requirement—

(1) The applicant may identify either specific AE or minimum specifications for the AE.

(i) If minimum specifications are identified, they must include the critical requirements of the AE, including performance, compatibility, function, reliability, interface, operator alerting, cyber security, and environmental requirements.

(ii) Critical requirements are those that if not met would impact the ability to operate the UA safely and efficiently.

(2) The applicant may use an interface control drawing, a requirements document, or other reference, titled so that it is clearly designated as AE interfaces to the UA.

(b) The applicant must show the FAA that the AE or minimum specifications identified in paragraph (a) of this section meet the following:

(1) The AE provide the functionality, performance, reliability, and information to assure UA airworthiness in conjunction with the rest of the design;

(2) The AE are compatible with the UA capabilities and interfaces;

(3) The AE must monitor and transmit to the operator all information required for safe flight and operation, including but not limited to those identified in D&R.100; and

(4) The minimum specifications, if identified, are correct, complete, consistent, and verifiable to assure UA airworthiness.

(c) The FAA will establish the approved AE or minimum specifications as operating limitations and include them in the UA type certificate data sheet and UA Flight Manual.

(d) The applicant must develop any maintenance instructions necessary to address implications from the AE on the airworthiness of the UA. Those instructions will be included in the instructions for continued airworthiness (ICA) required by D&R.205.

To minimize the existence of software errors, the applicant must:

(a) Verify by test all software that may impact the safe operation of the UA;

(b) Utilize a configuration management system that tracks, controls, and preserves changes made to software throughout the entire life cycle; and

(c) Implement a problem reporting system that captures and records defects and modifications to the software.

(a) UA equipment, systems, and networks, addressed separately and in relation to other systems, must be protected from intentional unauthorized electronic interactions that may result in an adverse effect on the security or airworthiness of the UA. Protection must be ensured by showing that the security risks have been identified, assessed, and mitigated as necessary.

(b) When required by paragraph (a) of this section, procedures and instructions to ensure security protections are maintained must be included in the ICA.

(a) The UA must be designed so that, in the event of a loss of the command and control (C2) link, the UA will automatically and immediately execute a safe predetermined flight, loiter, landing, or termination.

(b) The applicant must establish the predetermined action in the event of a loss of the C2 link and include it in the UA Flight Manual.

(c) The UA Flight Manual must include the minimum performance requirements for the C2 data link, defining when the C2 link is degraded to a level where remote active control of the UA is no longer ensured. Takeoff when the C2 link is degraded below the minimum link performance requirements must be prevented by design or prohibited by an operating limitation in the UA Flight Manual.

(a) Except as provided in paragraph (b) of this section, the UA must have design characteristics that will protect the UA from loss of flight or loss of control due to lightning.

(b) If the UA has not been shown to protect against lightning, the UA Flight Manual must include an operating limitation to prohibit flight into weather conditions conducive to lightning activity.

(a) For purposes of this section, “adverse weather conditions” means rain, snow, and icing.

(b) Except as provided in paragraph (c) of this section, the UA must have design characteristics that will allow the UA to operate within the adverse weather conditions specified in the CONOPS without loss of flight or loss of control.

(c) For adverse weather conditions for which the UA is not approved to operate, the applicant must develop operating limitations to prohibit flight into known adverse weather conditions and either:

(1) Develop operating limitations to prevent inadvertent flight into adverse weather conditions; or

(2) Provide a means to detect any adverse weather conditions for which the UA is not certificated to operate and show the UA's ability to avoid or exit those conditions.

(a) A flight essential part is a part, the failure of which could result in a loss of flight or unrecoverable loss of UA control.

(b) If the type design includes flight essential parts, the applicant must establish a flight essential parts list. The applicant must develop and define mandatory maintenance instructions or life limits, or a combination of both, to prevent failures of flight essential parts. Each of these mandatory actions must be included in the airworthiness limitations section of the ICA.

The applicant must provide a UA Flight Manual with each UA.

(a) The UA Flight Manual must contain the following information:

(1) UA operating limitations;

(2) UA operating procedures;

(3) Performance information;

(4) Loading information; and

(5) Other information that is necessary for safe operation because of design, operating, or handling characteristics.

(b) Those portions of the UA Flight Manual containing the information specified in paragraph (a)(1) of this section must be approved by the FAA.

The applicant must prepare the ICA for the UA in accordance with appendix A to 14 CFR part 23, as appropriate, that are acceptable to the FAA. The ICA may be incomplete at type certification if a program exists to ensure their completion prior to delivery of the first UA or issuance of a standard airworthiness certificate, whichever occurs later.

The UA must be designed to be durable and reliable when operated under the limitations prescribed for its operating environment, as documented in its CONOPS, and included as operating limitations on the type certificate data sheet and in the UA Flight Manual. The durability and reliability must be demonstrated by flight test in accordance with the requirements of this section and completed with no failures that result in a loss of flight, loss of control, loss of containment, or emergency landing outside the operator's recovery area.

(a) Once a UA has begun testing to show compliance with this section, all flights for that UA must be included in the flight test report.

(b) Tests must include an evaluation of the entire flight envelope across all phases of operation and must address, at a minimum, the following:

(1) Flight distances;

(2) Flight durations;

(3) Route complexity;

(4) Weight;

(5) Center of gravity;

(6) Density altitude;

(7) Outside air temperature;

(8) Airspeed;

(9) Wind;

(10) Weather;

(11) Operation at night, if requested;

(12) Energy storage system capacity; and

(13) Aircraft to pilot ratio.

(c) Tests must include the most adverse combinations of the conditions and configurations in paragraph (b) of this section.

(d) Tests must show a distribution of the different flight profiles and routes representative of the type of operations identified in the CONOPS.

(e) Tests must be conducted in conditions consistent with the expected environmental conditions identified in the CONOPS, including electromagnetic interference (EMI) and high intensity radiated fields (HIRF).

(f) Tests must not require exceptional piloting skill or alertness.

(g) Any UAS used for testing must be subject to the same worst-case ground handling, shipping, and transportation loads as those allowed in service.

(h) Any UA used for testing must use AE that meet, but do not exceed, the minimum specifications identified under D&R.105. If multiple AE are identified, the applicant must demonstrate each configuration.

(i) Any UAS used for testing must be maintained and operated in accordance with the ICA and UA Flight Manual. No maintenance beyond the intervals established in the ICA will be allowed to show compliance with this section.

(j) If cargo operations or external-load operations are requested, tests must show, throughout the flight envelope and with the cargo or the external load at the most critical combinations of weight and center of gravity, that—

(1) The UA is safely controllable and maneuverable; and

(2) The cargo or the external load is retainable and transportable.

The UA must be designed such that a probable failure will not result in a loss of containment or control of the UA. This must be demonstrated by test.

(a) Probable failures related to the following equipment, at a minimum, must be addressed:

(1) Propulsion systems;

(2) C2 link;

(3) Global positioning system (GPS);

(4) Flight control components with a single point of failure;

(5) Control station; and

(6) Any other AE identified by the applicant.

(b) Any UA used for testing must be operated in accordance with the UA Flight Manual.

(c) Each test must occur at the critical phase and mode of flight, and at the highest aircraft-to-pilot ratio.

(a) All of the following required UAS capabilities and functions must be demonstrated by test:

(1) Capability to regain command and control of the UA after the C2 link has been lost.

(2) Capability of the electrical system to power all UA systems and payloads.

(3) Ability for the pilot to safely discontinue the flight.

(4) Capability of the UA to maintain its preplanned flight path within acceptable navigation accuracy.

(5) Ability to safely abort a takeoff.

(6) Ability to safely abort a landing and initiate a go-around unless the UA is shown not to create a hazard when landing.

(b) The following UAS capabilities and functions, if requested for approval, must be demonstrated by test:

(1) Continued flight after degradation of the propulsion system.

(2) Geo-fencing that contains the UA within a designated area, in all operating conditions.

(3) Positive transfer of the UA between control stations that ensures only one control station can control the UA at a time.

(4) Capability to release an external cargo load to prevent loss of control of the UA.

(5) Capability to detect and avoid other aircraft and obstacles.

(c) The UA must be designed to safeguard against inadvertent discontinuation of the flight and inadvertent release of cargo or external load.

The structure of the UA must be shown to withstand the repeated loads expected during its service life without failure. A life limit for the airframe must be established, demonstrated by test, and included in the ICA.

The performance, maneuverability, stability, and control of the UA within the flight envelope described in the UA Flight Manual must be demonstrated at a minimum of 5% over maximum gross weight with no loss of control or loss of flight.

On February 17, 2021, Lufthansa applied for a supplemental type certificate for the installation of a UPS system in the Model A319-133 and A321-200 series airplanes. The Airbus Model A319-133 and A321-200 series airplanes are twin-engine, transport category airplanes. The Airbus Model A319-133 airplane has a maximum passenger seating capacity of 160, and a maximum takeoff weight of 154,322 pounds. The Airbus Model A321-200 airplane has a maximum passenger seating capacity 230, and a maximum takeoff weight of 213,848 pounds.

Under the provisions of title 14, Code of Federal Regulations (14 CFR) 21.101, Lufthansa must show that the Model A319-133 and A321-200 series airplanes, as changed, continue to meet the applicable provisions of the regulations listed in Type Certificate No. A28NM 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 Airbus Model A319-133 and A321-200 series 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 Airbus Model A319-133 and A321-200 series 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 Airbus Model A319-133 and A321-200 series airplanes will incorporate the following novel or unusual design features:

This design feature for this installation of a UPS system is based on supercapacitor technology.

Currently, there are no regulatory or industry standards for supercapacitors and their installation on transport category airplanes. Supercapacitors are used to provide power to non-essential cabin equipment when the normal power source is interrupted for a short period of time. In this design, the supercapacitor UPS system will allow connected equipment to be provided back-up power if normal electrical power source is interrupted, and remain operational such as during power transfers as well as provide transient voltage surge suppression should harmful high voltage transients occur. The UPS is only used for systems not critical to continued safe flight and landing.

Since the supercapacitor is being used as a high-capacity electrical storage device and functions similarly to rechargeable batteries, the special conditions used for lithium batteries are appropriate for supercapacitor installations and the hazardous conditions that could be presented. These special conditions are necessary to assist in the testing and installation of this supercapacitor on the aircraft.

Special condition 1 requires that the supercapacitor installation be designed to preclude propagation of a thermal event, such as self-sustained, uncontrolled increases in temperature or pressure. Special condition 1 is intended to ensure that the supercapacitor system is designed to eliminate the potential for uncontrollable failures. However, a certain number of failures will occur due to various factors beyond the control of the supercapacitor designer. Therefore, other special conditions are intended to protect the airplane and its occupants if other failures occur.

Special conditions 2, 6, 8, and 9 are self-explanatory.

Special condition 3 makes it clear that the flammable fluid fire protection requirements of § 25.863 apply to supercapacitor installations. Section 25.863 is applicable to areas of the airplane that could be exposed to flammable fluid leakage from airplane systems. Supercapacitors may contain an electrolyte that is a flammable fluid.

Special condition 4 requires that each supercapacitor installation not damage surrounding structure or adjacent systems, equipment, or electrical wiring interconnection system (EWIS) components from corrosive fluids or gases that may escape in such a way as to cause a hazardous condition.

While special condition 4 addresses corrosive fluids and gases, special condition 5 addresses heat. Special condition 5 requires that each supercapacitor installation have provisions to prevent any hazardous effect on surrounding structure or adjacent systems, equipment, or EWIS components, caused by the maximum amount of heat the supercapacitor installation can generate due to any failure of the supercapacitor installation or any of the individual supercapacitors. The means of meeting special conditions 4 and 5 may be the same, but the requirements are independent and address different hazards.

Special condition 7 requires that supercapacitor be disconnected or otherwise removed from its charging source without the need for crew intervention should the supercapacitor become overheated or fail in a manner that may create a safety hazard. This requirement applies to all supercapacitor installations and is not limited to those whose proper functioning is required for the safe operation of the airplane.

The 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.

The FAA issued Notice of Proposed Special Conditions No. 25-22-02-SC for the Airbus Model A319-133 and A321-200 series airplanes, which was published in the Federal Register on June 1, 2023 (88 FR 35781). The FAA received one comment from The Boeing Company (Boeing).

Boeing recommended the FAA add a definition of what constitutes a supercapacitor and high-capacity electrical storage device and to include their thresholds such as capacity, voltage, and dialectic strength. Boeing stated that this clarification of supercapacitor terminology will avoid any ambiguity and confusion when applying special conditions and their applicability, specifically with the inapplicability to small capacitors that are used on various electrical systems used in electronics.

The FAA acknowledges Boeing's recommendation that adding a definition of what constitutes a supercapacitor is important for clarification and to ensure these special conditions' inapplicability to small capacitors used in various electrical systems in aviation electronics. However, the FAA declines to create a definition for supercapacitors through special conditions. Currently, the FAA is not aware of an industry standard regarding the design and installation of supercapacitors. With no supercapacitor industry standard currently available, the similarity of the function of the supercapacitor closely relates to the rechargeable lithium batteries. Therefore, the special conditions used for lithium batteries are being used for this supercapacitor installation. The applicant and the FAA will review the design and installation of the supercapacitor to ensure these special conditions will apply only to supercapacitors used as energy storage devices similar to rechargeable lithium batteries.

As discussed above, these special conditions are applicable to the Airbus Model A319-133 and A321-200 series airplanes. Should Lufthansa apply at a later date for a change to the supplemental type certificate to include another model incorporating the same novel or unusual design feature included on Type Certificate No. A28NM, these special conditions would apply to that model as well.

Under standard practice, the effective date of final special conditions would be 30 days after the date of publication in the Federal Register . However, as the certification date for the Airbus Model A319-133 and A321-200 series airplanes is imminent, the FAA finds that good cause exists to make these special conditions effective upon publication.

This action affects only a certain novel or unusual design feature on Airbus Models A319-133 and A321-200 series airplanes. It is not a rule of general applicability and affects only the applicant who applied to the FAA for approval of these features on the airplane.

The authority citation for these special conditions is as follows:

Accordingly, pursuant to the authority delegated to me by the Administrator, the following special conditions are issued as part of the type certification basis for Airbus Model A319-133 and A321-200 series airplanes, as modified by Lufthansa Technik AG. Each supercapacitor installation must:

1. Be designed to preclude the occurrence of uncontrolled increases in temperature or pressure under all foreseeable operating and failure conditions to prevent fire and explosion.

2. Not emit explosive or toxic gasses, in normal operation or as the result of its failure that may accumulate in hazardous quantities in any area of the airplane.

3. Meet the requirements of § 25.863.

4. Not damage surrounding structure or adjacent systems, equipment, or electrical wiring interconnection system (EWIS) components from corrosive fluids or gases that may escape to cause a hazardous condition.

5. Have provisions to prevent any hazardous effect on surrounding structure or adjacent systems, equipment, or EWIS components, caused by the maximum amount of heat it can generate during any failure including any individual supercapacitors.

6. Have a means to prevent overheating or overcharging of the supercapacitor.

7. Have a means to automatically disconnect it from its charging source in the event of an over-temperature condition or failure.

8. Have a monitoring and alerting feature that alerts the flightcrew when the capacity has fallen below acceptable levels if its function is required for safe operation of the airplane. The flightcrew alerting must be in accordance with the requirements of § 25.1322.

9. Have a means to prevent insufficient charging if required for safe operation of the airplane.

Section 412 of the Internal Revenue Code (Code) prescribes minimum funding requirements for defined benefit pension plans. Section 430 specifies the minimum funding requirements that apply generally to defined benefit plans that are not multiemployer plans. 1 For a plan subject to section 430, section 430(a) defines the minimum required contribution for a plan year by reference to the plan's funding target for the plan year. Under section 430(d)(1), a plan's funding target for a plan year generally is the present value of all benefits accrued or earned under the plan as of the first day of that plan year.

Section 430(h)(2) provides rules regarding the interest rates to be used under section 430. Section 430(h)(2)(B) provides that a plan's funding target and target normal cost for a plan year are determined using three interest rates: (1) the first segment rate, which applies to benefits reasonably determined to be payable during the 5-year period beginning on the valuation date; (2) the second segment rate, which applies to benefits reasonably determined to be payable during the next 15-year period; and (3) the third segment rate, which applies to benefits reasonably determined to be paid after that 15-year period. Under sections 430(h)(2)(C)(i) through (iii), each of these segment rates is determined for a month on the basis of the corporate bond yield curve for the month, taking into account only that portion of the yield curve that is based on bonds maturing during the period for which the segment rate is used.

Section 430(h)(2)(C)(iv), which was added to the Code in 2012 by section 40211 of the Moving Ahead for Progress in the 21st Century Act, Public Law 112-141, 126 Stat. 405, and has been modified several times since then (most recently in 2021 by section 80602 of the Infrastructure Investment and Jobs Act, Pub. L. 117-58, 135 Stat. 429), provides interest rate stabilization rules under which the segment rates are constrained by reference to the 25-year average segment rates. Under section 430(h)(2)(C)(iv), if a segment rate for a month is less than the applicable minimum percentage, or more than the applicable maximum percentage, of the average of the corresponding segment rates for years in the 25-year period ending with September 30 of the calendar year preceding the calendar year in which the plan year begins, then the segment rate for that month is equal to the applicable minimum percentage or the applicable maximum percentage of the corresponding 25-year average segment rate, whichever is closest. The last sentence of section 430(h)(2)(C)(iv)(I) provides that any 25-year average segment rate that is less than 5 percent is deemed to be 5 percent.

Under section 430(h)(2)(D)(i), the term “corporate bond yield curve” means, with respect to any month, a yield curve prescribed by the Secretary for the month that reflects the average, for the 24-month period ending with the month preceding such month, of monthly yields on investment grade corporate bonds with varying maturities and that are in the top three quality levels available. Section 430(h)(2)(D)(ii) permits a plan sponsor to elect to use the corporate bond yield curve, rather than the segment rates, to determine the plan's minimum required contribution. The yield curve that applies pursuant to this election is determined without regard to 24-month averaging. This election, once made, may be revoked only with the consent of the Secretary.

Under section 430(h)(2)(F), the Secretary is instructed to publish for each month the corporate bond yield curve (without regard to the 24-month averaging specification), the segment rates described in section 430(h)(2)(C), and the 25-year averages of segment rates used under section 430(h)(4)(C)(iv). The Secretary is also instructed to publish a description of the methodology used to determine the yield curve and segment rates which is sufficiently detailed to enable plans to make reasonable projections regarding the yield curve and segment rates for future months based on the plan's projection of future interest rates.

Section 1.430(h)(2)-1 was issued in 2009 to provide rules regarding the interest rates to be used under section 430. T.D. 9467, 74 FR 53004. Section 1.430(h)(2)-1(d) provides that the methodology for determining the yield curve is provided in guidance that is published in the Internal Revenue Bulletin. Notice 2007-81, 2007-2 CB 899, describes the methodology used by the Department of the Treasury (Treasury Department) to develop the corporate bond yield curve. Section 1.430(h)(2)-1(d) also provides that the yield curve for each month will be set forth in guidance published in the Internal Revenue Bulletin. Monthly IRS notices set forth the corporate bond yield curve for the month (without regard to the 24-month averaging specification), the section 430 segment interest rates (before and after adjustment pursuant to section 430(h)(3)(C)(iv)), and the 25-year average segment rates (which are updated annually).

Section 417(e)(3) provides assumptions for determining minimum present value for certain purposes, including the determination of a lump-sum that is the present value of an annuity, and prescribes an applicable interest rate for this purpose. Section 417(e)(3)(C) provides that the term “applicable interest rate” means the adjusted first, second, and third segment rates applied under rules similar to the rules of section 430(h)(2)(C) for the month before the date of a distribution or such other time as the Secretary may prescribe by regulations. However, for purposes of section 417(e)(3), these rates are determined without regard to the segment rate stabilization rules of section 430(h)(2)(C)(iv). In addition, under section 417(e)(3)(D), these rates are determined using the average yields for a month, rather than the 24-month average used under section 430(h)(2)(D).

Under section 846(c), the Secretary determines the applicable interest rate to be used by insurance companies to discount unpaid losses on the basis of the corporate bond yield curve (as defined in section 430(h)(2)(D)(i), determined by substituting “60-month period” for “24-month period”). Under § 1.832-4(c), the applicable interest rate determined under section 846(c) is also used by insurance companies to discount estimated salvage recoverable, unless the Commissioner publishes applicable discount factors to be used for that purpose.

A notice of proposed rulemaking and notice of public hearing (REG-124123-22) that would revise the methodology for determining the corporate bond yield curve was published in the Federal Register (88 FR 41047) on June 23, 2023. Two commenters submitted comments on the proposed regulations. A public hearing on the proposed regulations was scheduled for August 30, 2023, but was cancelled because no one requested to speak. After consideration of these comments, these final regulations are adopted with minor changes to the language from the proposed regulations to provide more detail on the methodology for determining the corporate bond yield curve.

These regulations specify the methodology used to develop the corporate bond yield curve. This methodology is generally the same as the methodology set forth in Notice 2007-81 but includes two refinements to take into account changes in the bond market since 2007. The regulations also amend the existing regulations under section 430(h)(2) to reflect the addition of the interest rate stabilization rules of section 430(h)(2)(C)(iv) and to eliminate transition rules that applied to plan years beginning before January 1, 2010.

One commenter expressed support for the rules set forth in the proposed regulations. The other commenter raised various concerns regarding the corporate bond yield curve. 2 Those concerns are discussed in this Summary of Comments and Explanation of Revisions.

Under these regulations, as under Notice 2007-81, the monthly corporate bond yield curve for a month is defined as the set of spot rates at specified durations. The specified durations are at 6-month intervals ranging from 6 months through 100 years, and the spot rate at a duration is the yield (when compounded semiannually) for a bond that matures at that duration with a single payment at maturity. Each spot rate at a specified duration on the monthly corporate bond yield curve for a month is equal to the arithmetic average for each business day of that month of the spot rates at that duration on the daily corporate bond yield curves.

Under these regulations, as under Notice 2007-81, each spot rate on the daily corporate bond yield curve is derived from a forward interest rate function (that is, the projected instantaneous interest rate at each point in time) that is defined by the selection of five coefficients of B-splines determined using the bond data, taking into account certain adjustment factors.

Two of those adjustment factors, which are included in the methodology set forth in Notice 2007-81, take into account the ratings of the bonds used to develop the daily corporate bond yield curve. The third adjustment factor, which was not included in the methodology set forth in that notice, is a hump adjustment variable that peaks at 20 years maturity  3 and serves to capture the effects of the hump in spot rates that is often seen around 20 years maturity.

Under the methodology used in Notice 2007-81, the spot rate at a duration t could be calculated directly as the discount rate at that duration derived from the forward interest rate function. However, the addition of the hump adjustment variable under the proposed regulations means that the calculation of the spot rates from the discount function and the hump adjustment variable requires an intermediate step. This intermediate step, which was implicit in the proposed regulations, involves the determination of a par yield curve (that is, the curve in which the rate at maturity t on the curve is equal to the yield for a bond with maturity of t for which the price is the same as the principal amount) that is calculated from the discount function and the hump adjustment variable. In response to a commenter's request that the regulations specify clear standards for the determination of the corporate bond yield curve, these regulations describe this intermediate step. Accordingly, these regulations clarify that the spot rates are determined by first setting the spot rate at duration of 1/2 year on the daily corporate bond yield curve as the yield at maturity of 1/2 year from the daily par yield curve, and then determining the spot rate for any later duration by applying an iterative process based on the spot rates at earlier durations and the daily par yield curve.

One commenter asked how the IRS handles the situation in which the rating of a bond is upgraded or downgraded during a month, or a bond is rated differently by different rating organizations for a single day. Because the monthly corporate bond yield curve is developed from a set of daily corporate bond yield curves, changes in ratings during the month are automatically taken into account. In the case of a bond that is rated differently by different ratings organizations on a single day, the bond is treated as having the average of the ratings for that day.

These regulations generally adopt the specification for the bond data set for a month under Notice 2007-81 but modify an exclusion from that bond data set. Under Notice 2007-81 and these regulations, subject to certain exclusions, the bonds that are used to construct the daily corporate bond yield curve for a business day are bonds with the following characteristics: (1) maturities longer than 1/2 year, 4 (2) at least two payment dates, (3) designated as corporate, (4) high quality ratings (that is, AAA, AA, or A) as of that business day from the nationally recognized statistical rating organizations, 5 (5) at least $250 million in par amount outstanding on at least one day during the month, (6) payment of fixed nominal semiannual coupons and the principal amount at maturity, and (7) maturity not later than 30 years after that day.

Under Notice 2007-81 and these regulations, the following categories of bonds are excluded from the bond data set: (1) bonds not denominated in U.S. dollars, (2) bonds not issued by U.S. corporations, (3) bonds that are capital securities (sometimes referred to as hybrid preferred stock), (4) bonds having variable coupon rates, (5) convertible bonds, (6) bonds issued by a government-sponsored enterprise (such as the Federal National Mortgage Association), (7) asset-backed bonds, (8) putable bonds, (9) bonds with sinking funds, and (10) bonds with a par amount outstanding below $250 million for the day for which the daily yield curve is constructed.

Notice 2007-81 also excluded callable bonds (unless the call feature is make-whole) from the bond data set used to construct the daily corporate bond yield curve. The regulations generally retain this exclusion but narrow it. Under the proposed regulations, this exclusion does not apply if the call feature is exercisable only during the last year before maturity. This type of call feature has recently become more widely used, and the inclusion of bonds with this feature in the data set will result in a significantly larger pool of bonds that more accurately reflects the market for high quality corporate bonds.

One commenter asked how the calculation of the yield of a corporate bond is affected by any options embedded in that bond. The complexity of the calculations involved in quantifying this effect is the reason that corporate bonds with embedded put and call options have been generally excluded from the set of bonds used to determine the corporate bond yield curve in the past. However, as noted in the preceding paragraph, including bonds with a call feature that is exercisable only during the last year before maturity significantly increases the pool of bonds that are taken into account in developing the corporate bond yield curve, and the Treasury Department and the IRS have determined that this feature does not significantly affect the yields of these bonds. Accordingly, no adjustment will be made to reflect the effect of this feature on bond yields.

These regulations apply for purposes of determining the corporate bond yield curve under section 430(h)(2)(D) for months that begin on or after February 1, 2024.

IRS Revenue Rulings, Revenue Procedures, and Notices cited in this document are published in the Internal Revenue Bulletin (or Cumulative Bulletin) and are available from the Superintendent of Documents, U.S. Government Printing Office, Washington, DC 20402, or by visiting the IRS website at www.irs.gov.

Pursuant to the Memorandum of Agreement, Review of Treasury Regulations under Executive Order 12866 (June 9, 2023), tax regulatory actions issued by the IRS are not subject to the requirements of section 6 of Executive Order 12866, as amended. Therefore, a regulatory impact assessment is not required.

It is hereby certified that this rule will not have a significant economic impact on a substantial number of small entities. The vast majority of plan sponsors of defined benefit plans that are subject to section 430 choose to use the segment rates under section 430(h)(2)(C), rather than the corporate bond yield curve under section 430(h)(2)(D), to determine minimum required contributions. Furthermore, most of the plan sponsors who choose to use the corporate bond yield curve for this purpose are not small employers. Therefore, the methodology set forth in these regulations for constructing the corporate bond yield curve will not have a significant effect on minimum required contributions for small employers. In addition, the insurance companies that are required to use a modified version of the corporate bond yield curve to discount unpaid losses are typically not small employers. Accordingly, a regulatory flexibility analysis under the Regulatory Flexibility Act is not required.

Pursuant to section 7805(f) of the Code, the proposed regulations that preceded these regulations were submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on their impact on small business, and no comments were received.

Section 202 of the Unfunded Mandates Reform Act of 1995 requires that agencies assess anticipated costs and benefits and take certain other actions before issuing a final rule that includes any Federal mandate that may result in expenditures in any one year by a State, local, or Tribal government, in the aggregate, or by the private sector, of $100 million in 1995 dollars, updated annually for inflation. These regulations do not include any Federal mandate that may result in expenditures by State, local, or Tribal governments, or by the private sector in excess of that threshold.

Executive Order 13132 (Federalism) prohibits an agency from publishing any rule that has federalism implications if the rule either imposes substantial, direct compliance costs on State and local governments, and is not required by statute, or preempts State law, unless the agency meets the consultation and funding requirements of section 6 of the Executive order. These regulations do not have federalism implications, impose substantial direct compliance costs on State and local governments, or preempt State law within the meaning of the Executive order.

Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq. ), the Office of Information and Regulatory Affairs designated this rule as not a major rule, as defined by 5 U.S.C. 804(2).

The principal authors of these regulations are Arslan Malik and Linda S.F. Marshall of the Office of Associate Chief Counsel (Employee Benefits, Exempt Organizations, and Employment Taxes). However, other personnel from the Treasury Department and the IRS participated in the development of these regulations.

Accordingly, the Treasury Department and the IRS amend 26 CFR part 1 as follows:

This rule is needed to carry out the requirements of the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 and Office of Management and Budget guidance M-24-07. The rule adjusts, as required for 2024, the maximum civil penalties under 29 CFR parts 4071 and 4302 that the Pension Benefit Guaranty Corporation (PBGC) may assess for failure to provide certain notices or other material information and certain multiemployer plan notices.

PBGC's legal authority for this action comes from the Federal Civil Penalties Inflation Adjustment Act of 1990 as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 and from sections 4002(b)(3), 4071, and 4302 of the Employee Retirement Income Security Act of 1974 (ERISA).

This rule adjusts as required by law the maximum civil penalties that PBGC may assess under sections 4071 and 4302 of ERISA. The new maximum amounts are $2,670 for section 4071 penalties and $356 for section 4302 penalties.

PBGC administers title IV of ERISA. Title IV has two provisions that authorize PBGC to assess civil monetary penalties. 1 Section 4302, added to ERISA by the Multiemployer Pension Plan Amendments Act of 1980, authorizes PBGC to assess a civil penalty of up to $100 a day for failure to provide a notice under subtitle E of title IV of ERISA (dealing with multiemployer plans). Section 4071, added to ERISA by the Omnibus Budget Reconciliation Act of 1987, authorizes PBGC to assess a civil penalty of up to $1,000 a day for failure to provide a notice or other material information under subtitles A, B, and C of title IV and sections 303(k)(4) and 306(g)(4) of title I of ERISA.

The Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015  2 requires agencies to adjust civil monetary penalties for inflation and to publish the adjustments in the Federal Register . An initial adjustment was required to be made by interim final rule published by July 1, 2016, and effective by August 1, 2016. Subsequent adjustments must be published by January 15 each year after 2016.

On December 19, 2023, the Office of Management and Budget issued memorandum M-24-07 on implementation of the 2024 annual inflation adjustment. 3 The memorandum provides agencies with the cost-of-living adjustment multiplier for 2024, which is based on the Consumer Price Index (CPI-U) for the month of October 2023, not seasonally adjusted. The multiplier for 2024 is 1.03241. The adjusted maximum amounts are $2,670 for section 4071 penalties and $356 for section 4302 penalties.

The Office of Management and Budget has determined that this rule is not a “significant regulatory action” under Executive Order 12866 and therefore not subject to its review.

The Office of Management and Budget also has determined that notice and public comment on this final rule are unnecessary because the adjustment of civil penalties implemented in the rule is required by law. See 5 U.S.C. 553(b).

Because no general notice of proposed rulemaking is required for this rule, the Regulatory Flexibility Act of 1980 does not apply. See 5 U.S.C. 601(2).

In consideration of the foregoing, PBGC amends 29 CFR parts 4071 and 4302 as follows:

Subject to OSMRE's oversight, SMCRA section 503(a) permits a State to assume primacy for the regulation of surface coal mining and reclamation operations on non-Federal and non-Indian lands within its borders by demonstrating that its program includes, among other things, State laws and regulations that govern surface coal mining and reclamation operations in accordance with the Act and consistent with the Federal regulations. See 30 U.S.C. 1253(a)(1) and (7). On the basis of these criteria, the Secretary of the Interior conditionally approved the West Virginia program on January 21, 1981. You can find background information on the West Virginia program, including the Secretary's findings, the disposition of comments, and conditions of approval of the West Virginia program in the January 21, 1981, Federal Register (46 FR 5915). You can also find later actions concerning the West Virginia program and program amendments at 30 CFR 948.10, 948.12, 948.13, 948.15, and 948.16.

By letter dated May 3, 2017 (Administrative Record No. 1608), and received by us on May 15, 2017, the West Virginia Department of Environmental Protection (WVDEP) submitted an amendment to its program under SMCRA, docketed as WV-125-FOR. The proposed amendment consists of statutory revisions to WVSCMRA contained in Senate Bill 687 of 2017 (S.B. 687) (approved April 26, 2017). See 2017 W.Va. Acts ch. 86.

Through S.B. 687, West Virginia seeks to revise statutory provisions related to the release of bonds and the use of money from the Special Reclamation Water Trust Fund to assure a reliable source of capital and operating expenses for the treatment of discharges from bond-forfeited sites. West Virginia also seeks to revise and reorganize the bond release requirements specific to when the different phases of a bond can be released and under what circumstances; it also preserves the requirement that no bond will be released until all reclamation requirements are met.

We announced receipt of the proposed amendment in the April 8, 2019, Federal Register (84 FR 13853) (Administrative Record No. 1617). In the same notice, we opened a public comment period and provided an opportunity for a public hearing on these provisions. The public comment period closed on May 8, 2019. We did not hold a public hearing or meeting because one was not requested. Letters were sent to various Federal agencies requesting comments (Administrative Record No. 1618), but none were received. For clarification, the summary of the April 8, 2019, proposed rule notice also unintentionally mentions revisions to pre-blasting and blasting requirements as being a part of this amendment. West Virginia had submitted other amendments to its blasting regulations that we had not yet addressed; therefore, in order to keep all changes to the blasting regulations together, we consolidated them into a separate amendment, which can be viewed at www.regulations.gov by searching the Docket ID Number OSM-2016-0010-0002, or SATS No. WV-123-FOR.

We are approving, with one deferral, the revisions proposed in WV-125-FOR as described below. The following are findings concerning West Virginia's amendment under SMCRA and the Federal regulations at 30 CFR 732.15 and 732.17. Any revisions that we do not specifically discuss below concerning non-substantive wording or editorial changes can be found in the full text of the program amendment available at www.regulations.gov, searchable by the Docket ID Number referenced at the top of this notice.

The following describes the substantive statutory revisions that WVDEP submitted to OSMRE for approval on May 3, 2017 (Administrative Record No. WV-1608).

1. W. Va. Code 22-3-11(g)(1)—Bonds; amount and method of bonding; bonding requirements; special reclamation tax and funds; prohibited acts; period of bond liability.

West Virginia seeks to revise W. Va. Code 22-3-11(g)(1) to specify that moneys in the Special Reclamation Water Trust Fund are to be used to assure a reliable source of capital and operating expenses for the treatment of water discharges from forfeited sites where the WVDEP Secretary has obtained or applied for a National Pollutant Discharge Elimination System (NPDES) permit as of the effective date of WVSCMRA. The existing provision states only that the funds assure “a reliable source of capital to reclaim and restore water treatment systems on forfeited sites.”

OSMRE's Findings: The West Virginia alternative bonding system was conditionally approved by the Secretary on January 21, 1981 (46 FR 5915), and the condition of the approval was removed on March 1, 1983 (48 FR 8448). This approval was granted under section 509(c) of SMCRA, 30 U.S.C. 1259(c), which allows for the approval of an alternative bonding system that will achieve the objectives and purposes of section 509. In drafting section 509(c), Congress was not specific in prescribing how alternative bonding programs should be financed. The relevant analysis is whether the proposed alternative bonding system achieves the objectives and purposes of a conventional bonding system as expressed in section 509 of SMCRA and as implemented by 30 CFR 800.11(e).

In the May 7, 2020, Federal Register (85 FR 27139), we approved on a permanent basis revisions to W. Va. Code 22-3-11(g) made by West Virginia in 2008 that added language to provide that the Special Reclamation Water Trust Fund was created within the State Treasury, into and from which moneys would be paid for the purpose of assuring a reliable source of capital to reclaim and restore water treatment systems on forfeited sites. Previously, the expenditure for water treatment systems was limited to fees collected under the Special Reclamation Fund. The revisions West Virginia proposes through S.B. 687 clarify that in addition to assuring sufficient funds to cover capital costs, which generally relate to the construction of water treatment systems, the funds must also be sufficient to cover those systems' operating expenses.

Both capital and operating costs must be accounted for to ensure compliance with the requirement in 30 CFR 800.11(e)(1) that the State have sufficient money to complete reclamation for any areas that may be in default at any time. In our 2020 approval, we made special mention of other language in this provision, which West Virginia now proposes to delete, that both funds are “for the purpose of designing, constructing, and maintaining water treatment systems.” See 85 FR at 27152. The proposed text stating that the Special Reclamation Water Trust Fund moneys are to be used for both capital and operating expenses only calls special attention to the distinction and removes any ambiguity from West Virginia's requirements in light of the proposed deletion of “for the purpose of designing, constructing, and maintaining water treatment systems,” which we address below in the provision West Virginia has renumbered as paragraph (g)(2). S.B. 687 also clarifies that the money from the Special Reclamation Water Trust Fund is to be used where the Secretary has received or applied for an NPDES permit. As indicated in proposed paragraph (g)(2), addressed below, both funds are “for the reclamation and rehabilitation” of eligible lands, which we understand to mean that to the extent that any reclamation obligation is not expensed under the Special Reclamation Water Trust Fund, it will be expensed under the Special Reclamation Fund. Neither of these revisions materially change West Virginia's program as we approved it on May 7, 2020, and it continues to be no less stringent than the Federal alternative bonding requirement at section 509(c) of SMCRA, 30 U.S.C. 1259(c), and no less effective than the Federal alternative bonding requirements at 30 CFR 800.11(e).

2. W. Va. Code 22-3-11(g)(2)—Bonds; amount and method of bonding; bonding requirements; special reclamation tax and funds; prohibited acts; period of bond liability.

In 1995, West Virginia submitted revisions to W. Va. Code 22-3-11(g) that established the development of a long-range planning process for selection and prioritization of sites to be reclaimed to avoid inordinate short-term obligations of the fund's assets of such magnitude that the solvency of the fund was jeopardized. Relying on West Virginia's implementing regulations at 38 CSR 2-12.4(c), which provide that reclamation operations must be initiated within 180 days following final forfeiture notice, we approved that revision to the extent that it provided only for the ranking of sites for reclamation without compromising the requirement that all sites for which bonds were posted be properly and timely reclaimed. See 60 FR 51900 (Oct. 4, 1995). In 2008, West Virginia further revised this section to account for the Special Reclamation Water Trust Fund and specified that “[t]he secretary may use both funds for the purpose of designing, constructing and maintaining water treatment systems when they are required for a complete reclamation of the affected lands described in this subsection.” West Virginia now seeks to delete these provisions, as well as renumber the remaining paragraph, formerly part of (g)(1), as (g)(2).

OSMRE's Findings: We addressed West Virginia's long-range planning process for selection and prioritization of sites to be reclaimed in previous decisions, specifically in the Federal Register documents of October 4, 1995 (60 FR 51900) and May 29, 2002 (67 FR 37610). In both of these instances, we explained in detail that for West Virginia's Special Reclamation Fund and Special Reclamation Water Trust Fund to remain solvent requires an inventory of sites requiring reclamation. Without this inventory, it is virtually impossible for the Special Reclamation Advisory Council to accurately assess the liabilities that would be included in the alternative bonding system. We further emphasized this fact in our letter to the WVDEP dated August 23, 2021 (Administrative Record No. 1659). Again, we raised concerns regarding WVDEP having not taken the necessary steps to ensure the complete and accurate listing of all outstanding reclamation obligations (including water treatment) on active permits. We informed WVDEP that the State was required to submit either a proposed written amendment or a description of an amendment to be proposed that meets the requirements of 30 CFR 732.17(f)(1) to establish a better inventory of existing obligations.

On October 18, 2021, WVDEP responded to our letter with a proposal for an amendment (Administrative Record No. 1664) to address this issue, which then proceeded through the State's statute and rulemaking process. On March 29, 2022, WVDEP submitted this proposed revision to the West Virginia program (Administrative Record No. 1666) to develop and maintain a database to track reclamation liabilities in the WVDEP Special Reclamation Program. We are deferring our decision on Section 22-3-11(g)(2) until we have reviewed the 2022 proposed amendment (docketed as WV-128-FOR). Our deferral does not impact West Virginia's efforts to renumber these provisions from subsection (g) to paragraph (g)(2), and the renumbering has no effect on the West Virginia program. Therefore, we approve the renumbering.

3. W. Va. Code 22-3-23(c)—Release of bond or deposits; application; notice; duties of Secretary; public hearings; final maps on grade release.

West Virginia seeks to amend W. Va. Code 22-3-23(c) to more closely reflect the language used in section 519(c) of SMCRA (Requirements for release), 30 U.S.C. 1269(c), first by eliminating the distinction previously created at existing subsections (c)(1) and (c)(2) between operations with and without an approved variance from the requirement that areas be reclaimed to approximate original contour (AOC). This proposed change replaces two sets of phased bond release requirements (currently at (c)(1)(A)-(C) and (c)(2)(A)-(C)) with one set of bond release requirements under subsection (c), paragraphs (1) through (3). The State also seeks to eliminate the proviso repeated under both sets of requirements that a minimum bond of ten thousand dollars shall be retained following Phase I and II bond releases, and a proviso that allowed total release of bonds following backfilling where provisions for sound future maintenance was assured by the local or regional economic development or planning agency and certain other requirements were met. West Virginia originally proposed the provision about sound future maintenance, as well as bond release provisions specific to operations with variances from AOC requirements, in relation to a Consent Decree agreed to by the plaintiffs and WVDEP in the matter of Bragg v. Robertson, Civil Action No. 2:98-0636 (S.D.W.Va.) (approved by the U.S. District Court for the Southern District of West Virginia on February 17, 2000). The remaining changes relate to Phase II bond release at existing subparagraphs (c)(1)(B) and (c)(2)(B), which will become paragraph (c)(2).

West Virginia's proposed revisions eliminate a requirement that Phase II bond release ( i.e., bond release following successful revegetation) may occur only at a minimum of two years from the last augmented seeding, fertilizing, irrigation, or other work, and eliminate the flat percentage of bond returned at Phase II bond release (ten percent for those operations with an approved variance from AOC, twenty-five percent for all other operations). In place of the flat percentages, paragraph (2) will provide that the bond or deposit, in whole or in part, may be released after revegetation has been established on the regraded mined lands in accordance with the approved reclamation plan. When determining the amount of bond to be released after successful revegetation has been established, the Secretary will retain that amount of bond for the revegetated area that would be sufficient for a third party to cover the cost of reestablishing revegetation and for the period specified for operator responsibility at W. Va. Code 22-3-13(b). This section establishes that the operator ensures that all reclamation efforts proceed in an environmentally sound manner and as contemporaneously as practicable and complies with the minimum environmental performance standards for surface mining operations.

Proposed paragraph (c)(3) redrafts provisos from subparagraphs (c)(1)(C) and (c)(2)(C) that provide that when the operator has successfully completed all surface coal mining and reclamation activities, the remaining portion of the bond may be released, but not before the expiration of the period specified for operator responsibility at W. Va. Code 22-3-13(b). These provisions also provide that no bond will be fully released until all reclamation requirements are complied with, and that “the release may be made where the quality of untreated post-mining water discharged is better than or equal to the premining water quality discharged from the mining site where expressly authorized,” which currently only relates to West Virginia's remining regulations at CSR 38-2-23. All of this language will now appear at proposed paragraph (c)(3).

OSMRE's Findings: As we explained in our August 18, 2000, Federal Register notice (65 FR 50409, 50411), West Virginia's bond release requirements particular to operations with approved AOC variances apply to mountaintop removal and steep slope mining operations. We noted at that time that the different percentages of bonds released did not exceed those provided under section 519(c) of SMCRA and the Federal regulations at 30 CFR 800.40(c). Further, we explained that there was no counterpart in SMCRA or its implementing regulations for the requirement that final bond cannot be released on lands subject to an AOC variance unless, if applicable, any necessary postmining infrastructure is established and any necessary financing is completed. Therefore, the elimination of these unique requirements from WVSCMRA is approved.

West Virginia proposed to delete a proviso stating that after Phase I and II bond release, operations must still maintain a minimum bond of $10,000. We find that this requirement is redundant of W. Va. Code 22-3-11(a), which states: “Provided, that the minimum amount of bond furnished for any type of reclamation bonding shall be ten thousand dollars.” The elimination of this proviso from W. Va. Code 22-3-23 does not relieve operations of the requirement of W. Va. Code 22-3-11(a), which itself is the same as the requirement under section 509(a) of SMCRA, 30 U.S.C. 1259(a). Therefore, we approve this deletion to the extent that it removes the requirement from West Virginia's bond release requirements, but we note that its deletion has no effect on West Virginia's general requirement that no reclamation bonds may be less than ten thousand dollars.

In the November 12, 1999, Federal Register (64 FR 61507, 61512), we deferred a decision on the proposed amendment that would allow certain operations to be granted full bond release where provisions for sound future maintenance were assured by the local or regional economic development or planning agency and certain other requirements were met. Our deferral pended West Virginia's submission of regulations that West Virginia believed would satisfy our concerns that the proviso created an exemption from bond release requirements that conflicted with SMCRA. At that time, we explained that until we readdressed our deferral, West Virginia was prohibited from implementing this provision. Because this provision never became effective, West Virginia's current proposed deletion of the proviso has no effect on West Virginia's program. Therefore, we are approving the deletion.

West Virginia also proposed to revise the requirements for Phase II bond release by eliminating the specified amount (ten and twenty-five percent) that is to be returned upon a Phase II bond release and eliminating the minimum two-year waiting period after the last augmented seeding before revegetation standards may be met. Neither SMCRA nor the Federal regulations specify an amount of bond to be released upon Phase II or proscribe a time period for the determination that revegetation has been established for the purpose of Phase II bond release. Rather, Federal law places within the discretion of the regulatory authority the need to determine and retain adequate bond to complete all required reclamation and to determine that successful revegetation has been established. See 30 U.S.C. 1269(c)(2) and 30 CFR 800.40(c)(2). When we approved West Virginia's inspection frequency of inactive mines, we explained that West Virginia's two-year requirement from last augmented seeding was more stringent than Federal requirements. See 55 FR 21304, 21333 (May 23, 1990). The Federal requirements at 30 CFR 800.40(c) “require only that revegetation be successfully established, with the definition of `established' left to the discretion of the regulatory authority, provided it includes adequacy to control erosion and compliance with the species composition requirements of the reclamation plan.” When a regulatory authority proposes to remove a provision that is more stringent than the Federal requirements, we must still ensure the remaining provisions are not rendered less stringent than those requirements. The two-year requirement is not critical to a mining operator's achievement of the relevant vegetative performance standard or to WVDEP's evaluation of whether the standard is met. The proposed amendment retains West Virginia's commitment to verify that applicable standards for vegetative success have been met before the relevant portion of the bond is released and, therefore, is no less stringent than sections 505 and 519 of SMCRA, 30 U.S.C. 1265 and 1269, or less effective than the Federal regulations at 30 CFR 800.40 and 816.116. Therefore, we are approving the amendment.

West Virginia's proposed revision would eliminate the flat percentage Phase II bond release in favor of retaining the amount of bond for the revegetated area that would be sufficient for a third party to cover the cost of reestablishing revegetation and for the period specified for operator responsibility. This proposed revision directly reflects the language of 30 CFR 800.40(c)(2). In 1983, we removed from paragraph (c)(2) a corresponding twenty-five percent Phase II maximum bond release requirement in favor of more flexibility for the regulatory authority to retain the amount of bond necessary. See 48 FR 32932, 32953 (July 19, 1983). At that time, we acknowledged that establishment of a maximum percentage as a Federal requirement was arbitrary and not consistent with SMCRA. Id. Given that West Virginia's revision brings its bond release requirement back in line with the Federal regulation, it is no less effective than Federal requirements, and we are approving it.

Regarding proposed paragraph (c)(3), this paragraph simply redrafts provisions related to the conditions for final bond release from existing subparagraphs (c)(1)(C) and (c)(2)(C), which were revisions initially required by us, see 50 FR 28316, 28319 (July 11, 1985), and for which we later approved subsequent revisions by West Virginia, see 68 FR 40157, 40158-59 (July 7, 2003). Because the proposed redrafting does not change any of these provisions from when we last approved them, we are approving the redrafted language.

4. W. Va. Code 22-3-23(i)—Release of bond or deposits; application; notice; duties of Secretary; public hearings; final maps on grade release.

WVDEP proposed to add subdivision (i) to its bonding requirements, which would authorize the Secretary to propose rules for legislative approval during the 2018 regular session of the Legislature that implemented the statutory changes discussed above while adopting, where possible, corresponding Federal regulatory standards. In addition, the Secretary was to specifically consider the adoption of corresponding Federal standards codified at 30 CFR part 700 et seq.

OSMRE's findings: OSMRE is approving the addition of subdivision (i) to WVDEP's bonding requirements, which authorizes the Secretary to propose rules for legislative approval. In addition, the WVDEP Secretary was to specifically consider the adoption of corresponding Federal standards codified at 30 CFR part 700 et seq. This approval enabled WVDEP the discretion to amend its bonding regulations as needed so that West Virginia's program may continue to satisfy Federal law. West Virginia made its regulatory revisions through a Committee Substitute for Senate Bill 163 of 2018, see 2018 W.Va. Acts ch. 141, which West Virginia submitted to us on May 2, 2018 (Administrative Record No. WV-1613A, in part), docketed as WV-126-FOR. Subsection (i) itself did not change any substantive provisions of West Virginia's approved program, but instead only directed WVDEP to fashion revisions to WVDEP's regulations that WVDEP determined were necessary to comply with Federal law. Therefore, subsection (i) is neither inconsistent with SMCRA nor less effective than SMCRA's implementing regulations. We are currently reviewing those regulatory revisions made under the authority of subsection (i) as part of a separate action docketed at WV-126-FOR.

We asked for public comments on the amendment and received a letter dated May 8, 2019, from the West Virginia Coal Association (WVCA) (Administrative Record No. 1627). WVCA stated in its letter that S.B. 687 revised both bonding and explosives and blasting provisions of the WVSCMRA. WVCA stated that it was unclear why WV-125-FOR only covered the bonding portion of the bill. The blasting provisions referenced in our public notice of WV-125-FOR on April 8, 2019, were moved into WV-123-FOR with House Bill 4726 (approved April 1, 2016), see 2016 W.Va. Acts ch.106, and Senate Bill 163 (approved May 2, 2018), see 2018 W.Va. Acts ch. 141, which also amended West Virginia's blasting laws.

On April 10, 2019, under 30 CFR 732.17(h)(11)(i) and section 503(b) of SMCRA, we requested comments on the amendment from various Federal agencies with an actual or potential interest in the West Virginia program (Administrative Record No. 1618). On April 30, 2019, we received a letter from the USDA Forest Service, Monongahela National Forest. The USDA Forest Service did not have any comments of the proposed changes to the revisions to the West Virginia Code (Administrative Record No. 1626).

Under 30 CFR 732.17(h)(11)(ii), we are required to get a written concurrence from EPA for those provisions of the program amendment that relate to air or water quality standards issued under the authority of the Clean Water Act (33 U.S.C. 1251 et seq. ) or the Clean Air Act (42 U.S.C. 7401 et seq. ). On April 10, 2019, under 30 CFR 732.17(h)(11)(i), we requested comments and concurrence from the EPA on the amendment (Administrative Record No. 1618). We received concurrence but no comments from the EPA on August 14, 2019, (Administrative Record No. 1629).

Under 30 CFR 732.17(h)(4), we are required to request comments from the SHPO and ACHP on amendments that may have an effect on historic properties. On April 10, 2019, we requested comments on West Virginia's amendment (Administrative Record No. 1618). We did not receive any comments.

We are approving this amendment, with one deferral, to the West Virginia statutory program under SMCRA. The amendment revises WVSCMRA as contained in Senate Bill 687 of 2017. These revisions modify the WVSCMRA requirements related to the release of bonds and provisions related to the use of money from the Special Reclamation Water Trust Fund.

Based on the above findings, we are approving the amendment WVDEP sent to us on May 3, 2017 (Administrative Record No. 1608), with one exception—we are deferring our decision on the removal of provisions related to the long-range planning process and the prioritization of sites. We will address those proposed revisions along with West Virginia's submission docketed at WV-128-FOR related to the establishment of a database to track existing reclamation liabilities.

To implement this decision, we are amending the Federal regulations at 30 CFR part 948 that codify decisions concerning the West Virginia program. In accordance with the Administrative Procedure Act, this rule will take effect 30 days after the date of publication.

This rule would not effect a taking of private property or otherwise have taking implications that would result in public property being taken for government use without just compensation under the law. Therefore, a takings implication assessment is not required. This determination is based on an analysis of the corresponding Federal regulations.

Executive Order 12866, as amended by Executive Order 14094, provides that the Office of Information and Regulatory Affairs in the Office of Management and Budget (OMB) will review all significant rules. Pursuant to OMB guidance, dated October 12, 1993, the approval of State program amendments is exempted from OMB review under Executive Order 12866, as amended by Executive Order 14094. Executive Order 13563, which reaffirms and supplements Executive Order 12866, retains this exemption.

The Department of the Interior has reviewed this rule as required by Section 3 of Executive Order 12988. The Department determined that this Federal Register document meets the criteria of Section 3 of Executive Order 12988, which is intended to ensure that the agency review its legislation and proposed regulations to eliminate drafting errors and ambiguity; that the agency write its legislation and regulations to minimize litigation; and that the agency's legislation and regulations provide a clear legal standard for affected conduct rather than a general standard, and promote simplification and burden reduction. Because Section 3 focuses on the quality of Federal legislation and regulations, the Department limited its review under this Executive Order to the quality of this Federal Register document and to changes to the Federal regulations. The review under this Executive Order did not extend to the language of the State regulatory program or to the program amendment that West Virginia drafted.

This rule has potential Federalism implications as defined under Section 1(a) of Executive Order 13132. Executive Order 13132 directs agencies to “grant the States the maximum administrative discretion possible” with respect to Federal statutes and regulations administered by the States. West Virginia, through its approved regulatory program, implements and administers SMCRA and its implementing regulations at the State level. This rule approves, in part, an amendment to the West Virginia program submitted and drafted by the State and defers decision on one element of the amendment only to the extent necessary to evaluate it in concert with a related amendment recently submitted by the State. Therefore, this rule is consistent with the direction to provide maximum administrative discretion to States.

The Department of the Interior strives to strengthen its government-to-government relationship with Tribes through a commitment to consultation with Tribes and recognition of their right to self-governance and Tribal sovereignty. We have evaluated this rule under the Department's consultation policy and under the criteria in Executive Order 13175 and have determined that it has no substantial direct effects on the distribution of power and responsibilities between the Federal government and Tribes. The basis for this determination is that our decision on the West Virginia program does not include Indian lands, as defined by SMCRA, or regulation of activities on Indian lands. Indian lands are regulated independently under the applicable approved Federal program. The Department's consultation policy also acknowledges that our rules may have Tribal implications where the State proposing the amendment encompasses ancestral lands in areas with mineable coal. We are currently working to identify and engage appropriate Tribal stakeholders to devise a constructive approach for consulting on such amendments.

Executive Order 13211 requires agencies to prepare a Statement of Energy Effects for a rulemaking that is (1) considered significant under Executive Order 12866, and (2) likely to have a significant adverse effect on the supply, distribution, or use of energy. Because this rule is exempt from review under Executive Order 12866 and is not a significant energy action under the definition in Executive Order 13211, a Statement of Energy Effects is not required.

This rule is not subject to Executive Order 13045 because this is not an economically significant regulatory action as defined by Executive Order 12866; and this action does not address environmental health or safety risks disproportionately affecting children.

Consistent with sections 501(a) and 702(d) of SMCRA (30 U.S.C. 1251(a) and 1292(d), respectively) and the U.S. Department of the Interior Departmental Manual, part 516, section 13.5(A), State program amendments are not major Federal actions within the meaning of section 102(2)(C) of the National Environmental Policy Act (42 U.S.C. 4332(2)(C)).

Section 12(d) of the National Technology Transfer and Advancement Act (15 U.S.C. 3701 et seq. ) directs OSMRE to use voluntary consensus standards in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. (OMB Circular A-119 at p. 14). This action is not subject to the requirements of section 12(d) of the NTTAA because application of those requirements would be inconsistent with SMCRA.

This rule does not include requests and requirements of an individual, partnership, or corporation to obtain information and report it to a Federal agency. As this rule does not contain information collection requirements, a submission to the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. 3501 et seq. ) is not required.

This rule will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ). The State submittal, which is the subject of this rule, is based upon corresponding Federal regulations for which an economic analysis was prepared and certification made that such regulations would not have a significant economic effect upon a substantial number of small entities. In making the determination as to whether this rule would have a significant economic impact, the Department relied upon the data and assumptions for the corresponding Federal regulations.

This rule is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act. This rule: (a) does not have an annual effect on the economy of $100 million; (b) will not cause a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions; and (c) does not have significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of U.S.-based enterprises to compete with foreign-based enterprises. This determination is based on an analysis of the corresponding Federal regulations, which were determined not to constitute a major rule.

This rule does not impose an unfunded mandate on State, local, or Tribal governments or the private sector of more than $100 million per year. The rule does not have a significant or unique effect on State, local, or Tribal governments or the private sector. This determination is based on an analysis of the corresponding Federal regulations, which were determined not to impose an unfunded mandate. Therefore, a statement containing the information required by the Unfunded Mandates Reform Act (2 U.S.C. 1531 et seq. ) is not required.

For the reasons set out in the preamble, 30 CFR part 948 is amended as follows:

This document and additional information concerning OFAC are available from OFAC's website ( www.treas.gov/ofac ).

Section 4 of the Federal Civil Penalties Inflation Adjustment Act of 1990 (Pub. L. 101-410, 104 Stat. 890; 28 U.S.C. 2461 note), as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (Pub. L. 114-74, 129 Stat. 599, 28 U.S.C. 2461 note) (the FCPIA Act), requires each federal agency with statutory authority to assess civil monetary penalties (CMPs) to adjust CMPs annually for inflation according to a formula described in section 5 of the FCPIA Act. One purpose of the FCPIA Act is to ensure that CMPs continue to maintain their deterrent effect through periodic cost-of-living-based adjustments.

OFAC has adjusted its CMPs nine times since the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 went into effect on November 2, 2015: an initial catch-up adjustment on August 1, 2016 (81 FR 43070, July 1, 2016); an additional initial catch-up adjustment related to CMPs for failure to comply with a requirement to furnish information, the late filing of a required report, and failure to maintain records (“recordkeeping CMPs”) that were inadvertently omitted from the August 1, 2016 initial catch-up adjustment on October 5, 2020 (85 FR 54911, September 3, 2020); and annual adjustments on February 10, 2017 (82 FR 10434, February 10, 2017); March 19, 2018 (83 FR 11876, March 19, 2018); June 14, 2019 (84 FR 27714, June 14, 2019); April 9, 2020 (85 FR 19884, April 9, 2020); March 17, 2021 (86 FR 14534, March 17, 2021); February 9, 2022 (87 FR 7369, February 9, 2022); and January 13, 2023 (88 FR 2229, January 13, 2023).

The method of calculating CMP adjustments applied in this final rule is required by the FCPIA Act. Under the FCPIA Act and the Office of Management and Budget guidance required by the FCPIA Act, annual inflation adjustments subsequent to the initial catch-up adjustment are to be based on the percent change between the Consumer Price Index for all Urban Consumers (“CPI-U”) for the October preceding the date of the adjustment and the prior year's October CPI-U. As set forth in Office of Management and Budget Memorandum M-24-07 of December 19, 2023, the adjustment multiplier for 2023 is 1.03241. In order to complete the 2024 annual adjustment, each current CMP is multiplied by the 2024 adjustment multiplier. Under the FCPIA Act, any increase in CMP must be rounded to the nearest multiple of $1.

OFAC imposes CMPs pursuant to the penalty authority in five statutes: the Trading With the Enemy Act (50 U.S.C. 4301-4341, at 4315) (TWEA); the International Emergency Economic Powers Act (50 U.S.C. 1701-1706, at 1705) (IEEPA); the Antiterrorism and Effective Death Penalty Act of 1996 (18 U.S.C. 2339B) (AEDPA); the Foreign Narcotics Kingpin Designation Act (21 U.S.C. 1901-1908, at 1906) (FNKDA); and the Clean Diamond Trade Act (19 U.S.C. 3901-3913, at 3907) (CDTA).

The table below summarizes the existing and new maximum CMP amounts for each statute.

In addition to updating these maximum CMP amounts, OFAC is also updating two references to one-half the IEEPA maximum CMP from $178,290 to $184,068, and is adjusting the recordkeeping CMP amounts found in OFAC's Economic Sanctions Enforcement Guidelines in appendix A to 31 CFR part 501. The table below summarizes the existing and new maximum CMP amounts for OFAC's recordkeeping CMPs.

Finally, OFAC is making changes in the authorities citations of 31 CFR parts 583 and 594 to more specifically reference one of the relevant statutory authorities in each citation.

The FCPIA Act expressly exempts this final rule from the notice and comment requirements of the Administrative Procedure Act by directing agencies to adjust CMPs for inflation “notwithstanding section 553 of title 5, United States Code” (Pub. L. 114-74, 129 Stat. 599; 28 U.S.C. 2461 note). As such, this final rule is being issued without prior public notice or opportunity for public comment, with an effective date of January 12, 2024.

Because no notice of proposed rulemaking is required, the provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq. ) do not apply.

This rule is not a significant regulatory action as defined in section 3.f. of Executive Order 12866 of September 30, 1993, “Regulatory Planning and Review” (58 FR 51735, October 4, 1993), as amended.

The Paperwork Reduction Act does not apply because this rule does not impose information collection requirements that would require the approval of the Office of Management and Budget under 44 U.S.C. 3501 et seq.

For the reasons set forth in the preamble, OFAC amends 31 CFR chapter V as follows:

The Federal Civil Penalties Inflation Adjustment Act of 1990, Public Law 101-410, codified at 28 U.S.C. 2461, note, as amended, requires agencies to annually adjust the level of CMPs for inflation to improve their effectiveness and maintain their deterrent effect. Section 2461 requires that not later than July 1, 2016, and not later than January 15 of every year thereafter, the head of each agency must adjust each CMP within its jurisdiction by the inflation adjustment set forth therein. The inflation adjustment is determined by increasing the maximum CMP or the range of minimum and maximum CMPs, as applicable, for each CMP by the cost- of-living adjustment, rounded to the nearest multiple of $1. The cost-of-living adjustment is the percentage (if any) for each CMP by which the Consumer Price Index (CPI) for the month of October preceding the date of the adjustment exceeds the CPI for the month of October in the previous calendar year.

The initial catch up adjustments for inflation to the DoD's CMPs were published as an interim final rule in the Federal Register on May 26, 2016 (81 FR 33389-33391) and became effective on that date. The interim final rule was published as a final rule without change on September 12, 2016 (81 FR 62629-62631), effective that date. The revised methodology for agencies for 2017 and each year thereafter provides for the improvement of the effectiveness of CMPs to maintain their deterrent effect. The DoD is adjusting the level of all civil monetary penalties under its jurisdiction by the Office of Management and Budget (OMB) directed cost-of-living adjustment multiplier for 2024 of 1.03241 prescribed in OMB Memorandum M-24-07, “Implementation of Penalty Inflation Adjustments for 2024, Pursuant to the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015.” The DoD's 2024 adjustments for inflation to CMPs apply only to those CMPs, including those whose associated violation predated such adjustment, which are assessed by the DoD after the effective date of the new CMP level.

Pursuant to 5 U.S.C. 553(b)B, there is good cause to issue this rule without prior public notice or opportunity for public comment because it would be impracticable and unnecessary. The Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (Section 2461) requires agencies, effective 2017, to make annual adjustments for inflation to CMPs notwithstanding 5 U.S.C. 553. Additionally, the methodology used, effective 2017, for adjusting CMPs for inflation is established in statute, with no discretion provided to agencies regarding the substance of the adjustments for inflation to CMPs. The DoD is charged only with performing ministerial computations to determine the dollar amount of adjustments for inflation to CMPs. Accordingly, prior public notice and an opportunity to comment are not required for this rule. For the same reasons, there is good cause under 5 U.S.C. 553(d)(3) to waive the 30-day delay in effective date.

Further, there are no significant costs associated with the regulatory revisions that would impose any mandates on the DoD, Federal, State or local governments, or the private sector. Accordingly, prior public notice and an opportunity for public comment are not required for this rule. The benefit of this rule is the DoD anticipates that civil monetary penalty collections may increase in the future due to new penalty authorities and other changes in this rule. However, it is difficult to accurately predict the extent of any increase, if any, due to a variety of factors, such as budget and staff resources, the number and quality of civil penalty referrals or leads, and the length of time needed to investigate and resolve a case.

Executive Order 12866, “Regulatory Planning and Review” and Executive Order 13563, “Improving Regulation and Regulatory Review”

Executive Order 14094, “Modernizing Regulatory Review,” supplements and reaffirms the principles, structures, and definitions governing contemporary regulatory review established in Executive Order 12866 of September 30, 1993 (Regulatory Planning and Review), and Executive Order 13563 of January 18, 2011 (Improving Regulation and Regulatory Review). In accordance with paragraph (b) of Executive Order 14094, section 3(f) of Executive Order 12866 is amended to read as follows: “Significant regulatory action” means any regulatory action that is likely to result in a rule that may:

(1) Have an annual effect on the economy of $200 million or more (adjusted every 3 years by the Administrator of OIRA for changes in gross domestic product); or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, territorial, or tribal governments or communities;

(2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency;

(3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or

(4) Raise legal or policy issues for which centralized review would meaningfully further the President's priorities or the principles set forth in this Executive order, as specifically authorized in a timely manner by the Administrator of OIRA in each case.

This rule has been designated “not significant,” under the amended section 3(f) of Executive Order 12866.

The Congressional Review Act, 5 U.S.C. 801 et seq., generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. A major rule may take effect no earlier than 60 calendar days after Congress receives the rule report or the rule is published in the Federal Register , whichever is later. This rule is not a major rule, as defined by 5 U.S.C. 804(2).

Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) (2 U.S.C. 1532) requires agencies to assess anticipated costs and benefits before issuing any rule the mandates of which require spending in any year of $100 million in 1995 dollars, updated annually for inflation. This rule will not mandate any requirements for State, local, or tribal governments, nor will it affect private sector costs.

The Under Secretary of Defense (Comptroller) certified that this rule is not subject to the Regulatory Flexibility Act (5 U.S.C. 601) because it would not, if promulgated, have a significant economic impact on a substantial number of small entities. Therefore, the Regulatory Flexibility Act, as amended, does not require DoD to prepare a regulatory flexibility analysis.

The Paperwork Reduction Act was enacted to minimize the paperwork burden for individuals; small businesses; educational and nonprofit institutions; Federal contractors; State, local and tribal governments; and other persons resulting from the collection of information by or for the Federal government. The Act requires agencies obtain approval from the OMB before using identical questions to collect information from ten or more persons. This rule does not impose reporting or recordkeeping requirements on the public.

Executive Order 13132 establishes certain requirements that an agency must meet when it promulgates a rule that imposes substantial direct requirement costs on State and local governments, preempts State law, or otherwise has Federalism implications. This final rule will not have a substantial effect on State and local governments.

It has been determined that this rule will not have a substantial effect on Indian tribal governments. This rule does not impose substantial direct compliance costs on one or more Indian tribes, preempt tribal law, or effect the distribution of power and responsibilities between the Federal government and Indian tribes.

Accordingly, 32 CFR part 269 is amended as follows.

DOI published a notice of proposed rulemaking (NPRM) in the Federal Register at 88 FR 44748 (July 13, 2023) proposing to exempt portions of the INTERIOR/OIG-02, Investigative Records, system of records from certain provisions of the Privacy Act pursuant to 5 U.S.C. 552a(k)(1), (k)(3), and (k)(5) because this system of records contains material that support activities related to investigations. The revised INTERIOR/OIG-02, Investigative Records, system of records notice (SORN) was published in the Federal Register at 88 FR 44827 (July 13, 2023). Comments were invited on both the INTERIOR/OIG-02 SORN and NPRM. DOI received no comments on the SORN and two general comments on the NPRM, which are posted on Regulations.gov for public viewing. The comments are not substantive, therefore, the NPRM will be implemented as proposed.

Executive Order 14094 reaffirms the principles of E.O. 12866 and E.O. 13563 and states that regulatory analysis should facilitate agency efforts to develop regulations that serve the public interest, advance statutory objectives, and are consistent with E.O. 12866, E.O. 13563, and the Presidential Memorandum of January 20, 2021 (Modernizing Regulatory Review). Regulatory analysis, as practicable and appropriate, shall recognize distributive impacts and equity, to the extent permitted by law. E.O. 13563 emphasizes further that regulations must be based on the best available science and that the rulemaking process must allow for public participation and an open exchange of ideas. We have developed this final rule in a manner consistent with these requirements.

E.O. 12866, as reaffirmed by E.O. 13563 and E.O. 14094, provides that the Office of Information and Regulatory Affairs (OIRA) in the Office of Management and Budget (OMB) will review all significant rules. OIRA has determined that this rule is not significant.

The Department of the Interior certifies that this document will not have a significant economic effect on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601, et seq., as amended by the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121)). This rule does not impose a requirement for small businesses to report or keep records on any of the requirements contained in this rule. The exemptions to the Privacy Act apply to individuals, and individuals are not covered entities under the Regulatory Flexibility Act. This rule is not a major rule under 5 U.S.C. 804(2). This rule:

(a) Does not have an annual effect on the economy of $100 million or more.

(b) Will not cause a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions.

(c) Does not have significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of United States-based enterprises to compete with foreign-based enterprises.

This rule does not impose an unfunded mandate on State, local, or Tribal governments in the aggregate, or on the private sector, of more than $100 million per year. The rule does not have a significant or unique effect on State, local, or Tribal governments or the private sector. This rule makes only minor changes to 43 CFR part 2. A statement containing the information required by the Unfunded Mandates Reform Act (2 U.S.C. 1501 et seq. ) is not required.

In accordance with Executive Order 12630, this rule will not have significant takings implications. This rule makes only minor changes to 43 CFR part 2. A takings implication assessment is not required.

In accordance with Executive Order 13132, this rule does not have any federalism implications to warrant the preparation of a Federalism Assessment. The rule is not associated with, nor will it have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. A Federalism Assessment is not required.

This rule complies with the requirements of Executive Order 12988. Specifically, this rule:

(a) Does not unduly burden the Federal judicial system.

(b) Meets the criteria of section 3(a) requiring that all regulations be reviewed to eliminate errors and ambiguity and be written to minimize litigation; and

(c) Meets the criteria of section 3(b)(2) requiring that all regulations be written in clear language and contain clear legal standards.

In accordance with Executive Order 13175, the Department of the Interior has evaluated this rule and determined that it would have no substantial effects on Federally Recognized Indian Tribes.

This rule does not require an information collection from 10 or more parties and a submission under the Paperwork Reduction Act (44 U.S.C. 3501, et seq. ) is not required.

This rule does not constitute a major Federal Action significantly affecting the quality for the human environment. A detailed statement under the National Environmental Policy Act of 1969 (NEPA), 42 U.S.C. 4321, et seq., is not required because the rule is covered by a categorical exclusion. We have determined the rule is categorically excluded under 43 CFR 46.210(i) because it is administrative, legal, and technical in nature. We also have determined the rule does not involve any of the extraordinary circumstances listed in 43 CFR 46.215 that would require further analysis under NEPA.

This rule is not a significant energy action under the definition in Executive Order 13211. A Statement of Energy Effects is not required.

We are required by Executive Order 12866 and 12988, the Plain Writing Act of 2010 (Pub. L. 111-274), and the Presidential Memorandum of June 1, 1998, to write all rules in plain language. This means each rule we publish must:

For the reasons stated in the preamble, the Department of the Interior proposes to amend 43 CFR part 2 as follows:

This is a summary of the Commission's Order, DA 23-1198, adopted and released on December 22, 2023. The complete text of this document is available for download at https://docs.fcc.gov/public/attachments/DA-23-1198A1.pdf. To request this document in accessible formats for people with disabilities ( e.g., Braille, large print, electronic files, audio format, etc.) or to request reasonable accommodations ( e.g., accessible format documents, sign language interpreters, CART, etc.), send an email to fcc504@fcc.gov or call the FCC's Consumer and Governmental Affairs Bureau at (202) 418-0530 (voice).

The Bipartisan Budget Act of 2015 included, as section 701 thereto, the Inflation Adjustment Act, which amended the Federal Civil Penalties Inflation Adjustment Act of 1990 (Pub. L. 101-410), to improve the effectiveness of civil monetary penalties and maintain their deterrent effect. Under the Inflation Adjustment Act, agencies are required to make annual inflationary adjustments by January 15 each year, beginning in 2017. The adjustments are calculated pursuant to Office of Management and Budget (OMB) guidance. OMB issued guidance on December 19, 2023, and this Order follows that guidance. The Commission therefore updates the civil monetary penalties for 2024, to reflect an annual inflation adjustment based on the percent change between each published October's CPI-U; in this case, October 2023 CPI-U (307.671)/October 2022 CPI-U (298.012) = 1.03241. The Commission multiplies 1.03241 by the most recent penalty amount and then rounds the result to the nearest dollar.

For 2024, the adjusted penalty or penalty range for each applicable penalty is calculated by multiplying the most recent penalty amount by the 2024 annual adjustment (1.03241), then rounding the result to the nearest dollar. The adjustments in civil monetary penalties that we adopt in this Order apply only to such penalties assessed on and after January 15, 2024.

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

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 this Order to Congress and the Government Accountability Office pursuant to 5 U.S.C. 801(a)(1)(A).

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

This is a summary of the Commission's Fourth Report and Order in WC Docket No. 17-84, adopted December 13, 2023, and released December 15, 2023. The full text of this document is available for public inspection at the following internet address: https://docs.fcc.gov/public/attachments/FCC-23-109A1.pdf. To request materials in accessible formats for people with disabilities ( e.g., 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.

1. Access to a broadband connection is a necessity of modern life. With consumers more dependent than ever on fixed and mobile broadband networks for work, healthcare services, education, and social activities, the Commission remains committed to ensuring consumers across the nation have meaningful access to broadband. With the support of the Commission's universal service fund, the Infrastructure Investment and Jobs Act, which included the largest ever Federal investment in broadband, as well as other Federal and state broadband deployment programs, more funding than ever is available to build the necessary infrastructure to bring much-needed broadband services to unserved and underserved areas in the United States. Key to these broadband projects are the utility poles that support the wires and the wireless equipment that carry broadband to American homes and businesses.

2. Over the last several years, the Commission has taken significant steps in setting the “rules for the road” for the discussions between utilities and telecommunications companies about the timing and cost of attaching broadband equipment to utility poles, with the backstop of a robust complaint process when parties cannot agree on the rates, terms, and conditions for pole attachments. (Note that section 224(c) of the Communications Act of 1934, as amended (the Act), exempts from Commission jurisdiction those pole attachments in states that have elected to regulate pole attachments themselves. To date, 23 states and the District of Columbia have opted out of Commission regulation of pole attachments in their jurisdictions. The Commission's pole attachment rules currently only apply to cable operators and providers of telecommunications services and therefore do not apply to broadband-only internet service providers. We recently proposed to reclassify broadband internet access service as a telecommunications service, which would, if completed, apply section 224 and the Commission's pole attachment rules to broadband-only internet service providers.) In this item, we take additional steps to speed broadband deployment by making the pole attachment process faster, more transparent, and more cost effective. Specifically, we adopt rules (1) establishing a new process for the Commission's review and assessment of pole attachment disputes that impede or delay broadband deployment in order to expedite resolution of such disputes, and (2) providing communications providers with information about the status of the utility poles they plan to use as they map out their broadband builds.

3. In 1996, as part of its implementation of the pole attachment requirements located in sections 224(h) and 224(i) of the Act, the Commission determined that when a modification, such as a pole replacement, is undertaken for the benefit of a particular party, then under cost causation principles, the benefiting party must assume the cost of the modification. (Section 224(h) states that whenever the owner of a pole, duct, conduit, or right-of-way intends to modify or alter such pole, duct, conduit, or right-of-way, the owner shall provide written notification of such action to any entity that has obtained an attachment to such conduit or right-of-way so that such entity may have a reasonable opportunity to add to or modify its existing attachment. Any entity that adds to or modifies its existing attachment after receiving such notification shall bear a proportionate share of the costs incurred by the owner in making such pole, duct, conduit, or right-of-way accessible. Section 224(i) states that an entity that obtains an attachment to a pole, conduit, or right-of-way shall not be required to bear any of the costs of rearranging or replacing its attachment, if such rearrangement or replacement is required as a result of an additional attachment or the modification of an existing attachment sought by any other entity (including the owner of such pole, duct, conduit, or right-of-way).) The Commission also found that when a utility decides to modify a pole for its own benefit, and no other attachers derive a benefit from the modification, the utility must bear the full cost of the new pole. The Commission further adopted a cost sharing principle for when an existing attacher uses a modification by another party as an opportunity to add to or modify its own attachments and applied this principle to utilities and other attachers seeking to use modifications as an opportunity to bring their own facilities into compliance with safety or other requirements. In the 2018 Wireline Infrastructure Order (83 FR 31659-02, July 9, 2018), the Commission reiterated that application of the cost sharing principle.

4. On July 16, 2020, NCTA—the internet & Television Association (NCTA) filed a Petition asking the Commission to clarify its rules in the context of pole replacements. Specifically, NCTA asked the Commission to declare that: (1) utilities must share in the cost of pole replacements in unserved areas pursuant to section 224 of the Act, § 1.1408(b) of the Commission's rules, and Commission precedent; (2) pole attachment complaints arising in unserved areas should be prioritized through placement on the Accelerated Docket under § 1.736 of the Commission's rules; and (3) § 1.1407(b) of the Commission's rules authorizes the Commission to order a utility to complete a pole replacement within a specified time frame or designate an authorized contractor to do so. NCTA argued that without Commission action, the costs and operational challenges associated with pole replacements will inhibit attachers from deploying broadband services to Americans in unserved areas.

5. In the 2021 Pole Replacement Declaratory Ruling, although the Wireline Competition Bureau declined to act on NCTA's Petition, finding that “it is more appropriate to address questions concerning the allocation of pole replacement costs within the context of a rulemaking, which provides the Commission with greater flexibility to tailor regulatory solutions,” it observed that the record developed in response to the NCTA Petition revealed inconsistent practices by utilities with regard to cost responsibility for pole replacements. Accordingly, the Bureau clarified that, pursuant to § 1.1408(b) of the Commission's rules and prior precedent, “utilities may not require requesting attachers to pay the entire cost of pole replacements that are not solely caused by the new attacher and, thus, may not avoid responsibility for pole replacement costs by postponing replacements until new attachment requests are submitted.” The Commission subsequently affirmed the Bureau's clarifications.

6. Last year, the Commission issued a Second Further Notice of Proposed Rulemaking ( Second FNPRM ) (87 FR 25181-01, Apr. 28, 2022) in this proceeding seeking comment on the universe of situations where the requesting attacher should not be required to pay for the full cost of a pole replacement and the proper allocation of costs among utilities and attachers in those situations. (To the extent that the Fourth Report and Order does not expressly address a topic that was subject to comment in the Second FNPRM, that issue remains pending.) Specifically, the Commission sought comment on the applicability of cost causation and cost allocation principles in the context of pole replacements— e.g., when is a pole replacement not caused (necessitated solely) by a new attachment request, and when and how parties must share in the costs of a pole replacement. The Commission also sought comment on the extent to which utilities directly benefit from pole replacements, including a utility's responsibility for the costs of pole upgrades and modifications unrelated to new attachments and the effect of early pole retirements on pole replacement cost causation and cost allocation calculations. The Second FNPRM also sought comment on whether the Commission should require utilities to share information with potential attachers concerning the condition and replacement status of their poles and other measures that may help avoid or expedite the resolution of disputes between the parties, including whether to expand use of the Commission's Accelerated Docket for pole attachment complaints and the specific criteria that Commission staff should use in deciding whether to place a pole complaint on the Accelerated Docket. (To the extent that the Fourth Report and Order does not expressly address a topic that was subject to comment in the Second FNPRM, that issue remains pending.)

7. In the Fourth Report and Order, we adopt measures to expedite resolution of pole attachment disputes that impede or delay broadband deployment. Specifically, we (1) establish an agency-wide rapid response team to provide coordinated review and assessment of such pole attachment disputes and to recommend effective dispute resolution procedures, and (2) adopt specific criteria to guide that team when considering whether a complaint (or portion thereof) should be included on the Enforcement Bureau's Accelerated Docket. We also require utilities to provide information regarding pole conditions and scheduled replacements to the extent that information is contained in cyclical pole inspection reports that utilities already create and maintain in the ordinary course of their business, or in pole inspection reports created between cyclical reports. (Both pole attachers and utilities made several other proposals, not addressed herein, regarding the process for pole attachments and replacements and ways they believe the process could be improved to reduce disputes and promote broadband deployment.)

8. We amend our rules to prioritize and expedite the resolution of pole attachment disputes that impede or delay broadband deployment by establishing a Commission intra-agency rapid response team—called the Rapid Broadband Assessment Team (RBAT)—to provide coordinated review and assessment of such disputes. (We codify these amendments in part 1, subpart J, of the Commission's rules ( i.e., Pole Attachment Complaint Procedures) by redesignating current § 1.1415 as § 1.1416 and adding a new § 1.1415. These rule amendments apply only to disputes involving pole attachments of a cable television system or a provider of telecommunications service and do not apply to disputes involving pole attachments of a broadband-only internet service provider. They also do not apply to disputes involving poles that are owned or controlled by a railroad, the Federal Government, a state (including a political subdivision thereof such as a municipality), or a cooperative association, or where the poles at issue are located in a state, or the District of Columbia, that has certified to the Commission that it regulates the rates, terms, and conditions of pole attachments in that state or jurisdiction pursuant to 47 U.S.C. 224(c). Should we adopt the proposal set forth in the Open internet NPRM (88 FR 76048-01, Nov. 3, 2023) to reclassify broadband-only internet service as a telecommunications service, section 224 would once again apply to broadband-only internet service providers deployments.) At the outset, we emphasize that we expect all parties to comply with the Commission's pole attachment rules and to negotiate in good faith to craft solutions that suit the needs of attachers and utilities to facilitate deployment projects. We recognize, however, that in some instances disagreements arise as to the conduct of one or multiple parties, and we encourage parties in those instances to avail themselves of the Commission's dispute resolution processes to both facilitate the resolution of disputes and, when necessary, use the formal adjudication process to develop precedent upon which parties can rely to settle future potential disputes. In this document, we amend our rules to create the RBAT in an effort to make the Commission's pole attachment dispute resolution process more responsive and adaptable with the goal of facilitating deployment.

9. The RBAT will be charged with expediting the resolution of these disputes by swiftly engaging key stakeholders, gathering relevant information, distilling issues in dispute, and recommending to the parties, where appropriate, an abbreviated mediation process, placement of a complaint (or portion of a complaint) on the Accelerated Docket based on consideration of specified criteria, and/or any other action that the RBAT determines will help the parties resolve their dispute. (The Schools, Health & Libraries Broadband (SHLB) Coalition suggests that creation of the RBAT may result in a needless administrative step and associated delay, and suggests that the RBAT, if created, be vested with authority to resolve disputes without going through the additional step of a complaint process. We decline to adopt this approach. The RBAT is designed to assist parties in resolving their dispute expeditiously without need for litigation. But if parties are unable to reach a resolution, either through mediation or other means, our existing complaint procedures, including the Accelerated Docket, ensure a means of adjudicating the dispute in accordance with due process.)

10. In the Second FNPRM, the Commission sought comment on NCTA's proposed adoption of policies “favoring the placement of pole attachment complaints arising in unserved areas on the [Commission's] Accelerated Docket[,]” a mechanism that requires the Commission to quickly resolve disputes between parties within 60 days. (Under § 1.736(a), complaint proceedings on the Accelerated Docket must be concluded within 60 days, and are therefore subject to shorter pleading deadlines and other modifications to the procedural rules that govern formal complaint proceedings.) It also sought comment on measures that would expedite the resolution of “pole replacement[ ]” disputes and on criteria for determining more generally “when pole attachment complaints should be placed on the Accelerated Docket.” Based on broad record support among attachers for further streamlining our processes as applied to disputes that impede or delay broadband deployment, we conclude that the targeted measures outlined below are warranted and will advance the Commission's goal of timely broadband deployment.

11. As the Commission observed in the Second FNPRM, our current rules provide a 180-day deadline (or shot clock) for final action on pole access complaints where a cable television system operator or provider of telecommunications service claims that it has been denied access to a pole, duct, conduit, or right-of-way owned or controlled by a utility. (For purposes of this subsection, the Commission has defined a “pole access complaint” as a complaint “filed by a cable television system or a provider of telecommunications service that alleges a complete denial of access to a utility pole[,]” and clarified that “[the] term [pole access complaint] does not encompass a complaint alleging that a utility is imposing unreasonable rates, terms, or conditions that amount to a denial of pole access.”) In addition, a 270-day shot clock currently applies to final action on all other pole attachment complaints ( i.e., those alleging unjust or unreasonable rates, terms, or conditions of attachment). Several commenters assert that these timeframes are commercially unreasonable for attachers seeking to deploy broadband networks, particularly in rural or unserved areas. (Charter asserts that the “[m]ere existence ” of a path allowing more routine use of the Accelerated Docket “could help broadband providers resolve disagreements without the need for Commission intervention” by “provid[ing] attachers facing government-imposed construction deadlines with a more credible option of seeking relief, thereby reducing the one-sided leverage held by pole owners today.”) NCTA submits that the need for expedited procedures has gained greater urgency recently for “providers . . . receiving government funds to build out broadband under deadlines that afford no time for a lengthy complaint process.” A number of commenters therefore propose more routine use of the Accelerated Docket, with its 60-day shot clock, especially for pole attachment disputes involving time-sensitive deployments in unserved areas. Several commenters also contend that the current Accelerated Docket rule does not sufficiently motivate utilities to comply with their obligation to allow pole access because it is unclear when Commission staff, in the exercise of their discretion under § 1.736(d) of our rules, will include a matter on the Accelerated Docket. Crown Castle asserts that “without certainty that the complaint will be promptly resolved, the decision to bring a formal complaint to the Commission involves business decisions about whether the resolution will be too late to meaningfully assist the deployment.” On the other hand, other commenters argue that sweeping or widespread imposition of the Accelerated Docket rule, with its highly compressed timeframes, could raise potential fairness and due process concerns given the complexity of the issues raised in most pole attachment cases. (Other commenters question the necessity of new rules (1) due to the relative infrequency of requests for Accelerated Docket treatment, see, e.g., Edison Electric Institute Comments at 54 (challenging the need to further expedite “denial of access” complaints based on “[t]he complete absence of [such] complaints before the Commission”), or (2) due to the lack of evidence of instances where dilatory actions of utilities have caused broadband grant recipients to lose access to such funding.) After considering these competing concerns, we find that the adoption of targeted dispute resolution reforms, as set forth below, will address the expressed need for quicker resolution of pole attachment disputes that may impede or delay broadband deployment while ensuring sufficient fairness and due process for all involved parties.

12. Disputes Subject to RBAT Review and Assessment Procedures. The Commission asked in the Second FNPRM whether any new dispute resolution procedures should be “limited to complaints that raise only discrete pole access issues” and do not require consideration of “whether a rate, term, or condition of attachment is unjust or unreasonable.” To address the need for timely broadband deployment, particularly in unserved or underserved areas, we apply the new procedures discussed below to any pole attachment dispute that a party alleges is impeding or delaying the deployment of broadband facilities. To provide greater clarity regarding when such a dispute would be eligible for placement on the Accelerated Docket, we also adopt below specific criteria that will guide the RBAT in determining when a dispute is suitable for accelerated disposition. In light of the strict time constraints of the Accelerated Docket, disputes raising relatively straightforward legal and evidentiary issues, as determined based on the RBAT's review of these criteria, are more likely to be considered appropriate for placement on the Accelerated Docket.

13. Although the record reflects differing views regarding which disputes should be subject to new dispute resolution procedures, a significant proportion of commenters seeking such reforms ask that we limit the focus of any new procedures to disputes that are interfering with active broadband deployment plans or projects. We adopt this suggestion based on our conclusion that focusing on pole attachment disputes that impede or delay a provider's ability to deploy new broadband facilities will align with, and advance most directly, the goal of timely broadband deployment. (Several utilities argue that across-the-board application of dispute resolution reforms to an entire category of disputes would fail to account for complexities in individual cases. But such comments assume that Accelerated Docket treatment would automatically apply to all disputes within the identified category. In fact, under the reforms we adopt herein, such disputes will receive individualized assessment and review (by the RBAT) based on a totality of factors analysis.)

14. RBAT Review and Assessment of Disputes that Impede or Delay Broadband Deployment. To expedite the resolution of pole attachment disputes that impede or delay an active broadband deployment project, we amend our rules to establish the RBAT, which will be comprised of Enforcement Bureau and Wireline Competition Bureau staff with expertise in the Commission's pole attachment rules and orders. We charge the RBAT with prioritizing the resolution of any pole attachment dispute that a party alleges is impeding or delaying the deployment of broadband facilities (including where the party is also seeking placement of the matter on the Accelerated Docket under § 1.736). In performing this role, the RBAT will gather and promptly review all pertinent information submitted by the parties and provide guidance and advice on the most effective means of resolving the parties' dispute. Where appropriate, the RBAT will recommend to the parties an abbreviated mediation process, placement of a complaint, or portion of a complaint, on the Accelerated Docket, and/or any other action that the RBAT determines will help the parties resolve their dispute. The RBAT will recommend use of the Accelerated Docket where it determines, based upon a totality of the criteria outlined below, that a complaint, or portion thereof, is suitable for accelerated disposition. (The RBAT may recommend placement of a dispute on the Accelerated Docket in the exercise of the discretion afforded Commission staff “to decide whether a complaint, or portion of a complaint, is suitable for inclusion on the Accelerated Docket.” A prospective complainant may accept the recommendation, with or without the consent of the other party or parties to the dispute, by moving forward with the agreed upon schedule and process established by Commission staff in the case.) To request RBAT review and assessment of a dispute that a party to the dispute contends is impeding or delaying deployment of broadband facilities, the party must first notify the Chief of the Enforcement Bureau's Market Disputes Resolution Division (MDRD) of the request by phone and in writing. (The RBAT review and assessment process will be available only to attachers and pole owners that are direct parties to such dispute (including any legal counsel retained to represent a party in that specific dispute). For parties seeking both RBAT review and inclusion of a proceeding relating to broadband facilities deployment on the Accelerated Docket, this initial notification by phone and in writing would need to be made prior to filing the formal complaint and would constitute the notification required under § 1.736(b).) The MDRD Chief will direct the party to a streamlined form on the MDRD website—Request for RBAT Review and Assessment—and to instructions for completing and electronically transmitting the form to the RBAT. The form will elicit information relevant to the scope and nature of the dispute, and to whether the dispute is appropriate for expedited mediation and/or placement on the Accelerated Docket. (The form will require a submitting party to provide: information identifying the parties and the services they offer; the section(s) of the Act or Commission rule or order alleged to have been violated; a brief description of the parties' dispute (including how it relates to broadband deployment plans or projects, whether such plans or projects are subject to a deadline under a government funded broadband program, whether the dispute arises in an unserved or underserved area, what harm is occurring or is likely to occur as a result of the situation, and what aspects of the dispute require immediate redress); the specific relief sought; whether the parties have entered into a non-disclosure agreement; the steps the party has taken to resolve the matter with other parties to the dispute; a statement as to whether the parties are amenable to mediation; and a statement indicating whether the party intends to seek inclusion of the matter on the Accelerated Docket. The form also will elicit information relevant to whether the dispute is suitable for accelerated disposition including, for example, the number of poles in question, the number and complexity of claims at issue, and the likely need for discovery or expert affidavits. The RBAT may request additional information from the submitting party if more information is necessary to determine a course of action.)

15. Upon receipt of the completed Request for RBAT Review and Assessment, the RBAT will schedule a meeting through a manner of the RBAT's choosing, with all parties as soon as practicable. The RBAT may request a written response from the other party or parties to the dispute with respect to one or more issues raised by the party seeking RBAT review. The RBAT also may request that one or both parties provide the RBAT with documentation or other information relevant to the dispute. (NCTA suggests that we specify the information the respondent will be required to provide. We find this approach impracticable, as the information required in a response will depend on the complainant's allegations. We employ a more flexible approach that enables the RBAT to request relevant information and documentation from either party, as appropriate.) In the initial meeting, or in a meeting shortly thereafter, the RBAT will provide guidance and advice to the parties on the most effective means of resolving their dispute, including staff-supervised mediation, use of the Accelerated Docket, and/or other action. (Because mediation will be a prominent feature of the RBAT review, we decline to adopt INCOMPAS's proposal that the 180-day deadline for resolution of a pole access complaint be triggered by the submission of the request for RBAT Review and Assessment. If mediation succeeds, there will be no need for a complaint. If it does not, the filing of a complaint will commence review period deadlines under the relevant Commission rules.) To that end, the RBAT will attempt to distill the issues in dispute and identify issues that are most impacting a party's broadband deployment plans. For example, the RBAT may encourage parties to focus on the resolution of one or more threshold issues, or what appears to be the most urgent issue(s), if it finds that doing so may help the parties to narrow their dispute. Likewise, the RBAT may encourage parties, where appropriate, to streamline the proceeding by agreeing to focus on “test cases”— i.e., disputes over specific poles that the parties agree are representative of disputes over multiple poles. In this way, deciding the issue as to the test case will have broader impact.

16. Should the RBAT recommend staff-supervised mediation, it shall be conducted pursuant to § 1.737 of the Commission's rules. Because § 1.737 generally contemplates that mediations will be conducted by MDRD staff, we delegate authority to the MDRD Chief, in consultation with the RBAT, to modify or waive the procedures or requirements of § 1.737 as appropriate in this context, or as needed in light of the facts or circumstances of a particular case. (Waiver is appropriate for “good cause,” and is warranted only if both: (1) special circumstances warrant a deviation from the general rule, and (2) such deviation will serve the public interest.) The strict confidentiality requirements will apply to all written and oral communications prepared or made for purposes of a mediation pursuant to § 1.737(f), including mediation submissions, offers of compromise, and staff and party comments made during the course of the mediation (Mediation Communications). Through mediation, the RBAT will make every effort to settle or narrow the issues in dispute as expeditiously as possible.

17. In the event that the parties are unable to settle their dispute, and a prospective complainant seeks placement of its complaint on the Accelerated Docket, the RBAT will decide whether the complaint or a portion of the complaint is suitable for inclusion on the Accelerated Docket based on the totality of the criteria set forth below. Because of the very short deadlines that apply in Accelerated Docket proceedings, Commission staff historically have carefully evaluated whether a particular dispute is appropriate for expedited disposition, resulting in the placement of relatively few cases on the Accelerated Docket. In evaluating whether a matter is suitable for expedited disposition, the RBAT must similarly be mindful of the due process concerns raised by commenters, such as the Pennsylvania PUC, regarding affording parties “the opportunity to be heard at a meaningful time and in a meaningful manner.” In addition, although mediation is generally voluntary, the RBAT may require that the parties participate, if appropriate, in pre-filing settlement negotiations or mediation under rule 1.737 as a condition for including a matter on the Accelerated Docket. Finally, if the RBAT determines that a matter is suitable for inclusion on the Accelerated Docket, the RBAT is authorized to send appropriate matters to the Commission's Administrative Law Judge (ALJ) for an expedited “minitrial” ( i.e., trial-type hearing) as contemplated by § 1.736(h).

18. Criteria for Placement on the Accelerated Docket. The Commission sought comment in the Second FNPRM on the adoption of specific criteria to guide Commission staff on “when pole attachment complaints should be placed on the Accelerated Docket.” (For example, the Commission asked if its policy should “take into account the number and complexity of the claims, need for discovery, need for expert affidavits, and ability of the parties to stipulate to facts.”) Based on the requests of several commenters for greater predictability surrounding Accelerated Docket placement decisions with respect to pole attachment disputes that impede or delay broadband deployment, we establish criteria to aid the RBAT in making determinations regarding the placement of such matters on the Accelerated Docket.

19. In light of the strict time constraints that apply in Accelerated Docket cases, we decline to adopt a “presumption,” as suggested by some commenters, that all pole access disputes for active deployments be placed on the Accelerated Docket and, instead, entrust the RBAT with this decision based on the criteria specified below. (There is no basis for us to conclude that a dispute will be suitable for the Accelerated Docket simply based on the number of poles at issue as INCOMPAS's proposal suggests.) We agree with Dominion/Xcel that a “one-size-fits-all policy” would not adequately take into account the complexity of the issues in particular complaint proceedings. We also agree with the Coalition of Concerned Utilities that the 60-day timeframe will be “too short” to resolve certain pole attachment disputes, and thus “blanket imposition” of the Accelerated Docket requirements would be unreasonable and “raise due process concerns” for utilities. Although Charter argues that the presumption could simply be rebutted if a particular complaint raises unusually complex issues, we reject this argument based on our experience with formal complaints. In particular, when parties oppose the operation of a presumption in a particular proceeding, these rebuttal efforts often lead to significant additional argumentation attendant to resolving the specific question of the presumption, thus unnecessarily complicating resolution of the underlying issues in dispute. To avoid the potential for unnecessary rounds of argumentation and to ensure that complaints accepted onto the Accelerated Docket are suitable for decision under the relevant time constraints, we reject proposals to create a presumption that all pole access disputes for active deployments be placed on the Accelerated Docket.

20. After careful consideration of the record on this issue, we direct the RBAT to consider the factors below in determining whether to accept onto the Accelerated Docket a pole attachment dispute that is allegedly impeding or delaying a broadband facilities deployment plan or project. The RBAT shall determine eligibility for placement on the Accelerated Docket based on the totality of these factors:

• whether the prospective complainant states a claim for violation of the Act or a Commission rule or order that falls within the Commission's jurisdiction;

• whether the expedited resolution of a particular dispute or category of disputes appears likely to advance the deployment of broadband facilities, especially in an unserved or underserved area;

• whether the parties to the dispute have exhausted all reasonable opportunities for settlement during any staff-supervised mediation;

• the number and complexity of the issues in dispute;

• whether the dispute raises new or novel issues versus settled interpretations of rules or policies;

• the likely need for, and complexity of, discovery;

• the likely need for expert testimony;

• the ability of the parties to stipulate to facts;

• whether the parties have already assembled relevant evidence bearing on the disputed facts;

• the willingness of the prospective complainant to seek a ruling on a subset of claims or issues ( e.g., threshold or “test cases”); and

• such other factors as the RBAT, within its discretion, may deem appropriate and conducive to the prompt and fair adjudication of the complaint proceeding.

The first three of these criteria will help the RBAT to ensure appropriate use of the Commission's processes in support of the goal of timely broadband deployment and ensure that the parties have made a sufficient effort to resolve or, at a minimum, identify and narrow the disputed issues prior to filing a complaint. The remaining criteria will help the RBAT to determine if a dispute is suitable for decision under the strict time constraints of the Accelerated Docket, and also require it to consider whether including a matter on the Accelerated Docket would ensure the prompt and fair adjudication of the dispute. (A responding party's refusal to stipulate to facts or cooperate in the exchange of relevant information bearing on disputed facts will not itself defeat a request for acceptance of a pole attachment dispute on the Accelerated Docket.) By specifying the criteria that the RBAT must consider in making its determination, we hope to make the Accelerated Docket a more useful tool in the resolution of eligible pole attachment disputes and provide prospective complainants with greater certainty regarding which complaints will be deemed suitable for expedited resolution.

21. We will closely monitor the impact of the dispute resolution procedures adopted here and consider additional streamlining measures should we observe ongoing delay tactics or other unreasonable practices that hinder the ability of broadband providers to deploy new services or facilities. (Two commenters suggest narrowing the list of criteria to avoid delay tactics by utilities. We find that eliminating criteria is unnecessary, however, as these criteria are holistic in nature, and no single one will be dispositive. Moreover, the RBAT is not required to credulously accept assertions from either party.)

22. We next amend our pole attachment make-ready rules to require utilities to provide to potential attachers, upon request, the information contained in their most recent cyclical pole inspection reports, or any intervening, periodic reports created before the next cyclical inspection, for the poles covered by a submitted attachment application, including whether any of the affected poles have been “red tagged” by the utility for replacement, and the scheduled replacement date or timeframe (if any). (The record demonstrates that utilities conduct inspections of their poles on a multi-year cycle, either as part of normal network management or as required by state law.) In the Second FNPRM, the Commission sought comment on requiring utilities to provide more information about their poles to prospective attachers, in order to reduce disputes. (Utilities did not challenge the Commission's general jurisdiction to require them to provide relevant information to prospective attachers, and ACA Connects asserted the Commission has such authority.) Several attaching entities indicated pole inspection information would be helpful in planning deployments. (This requirement applies only in the states that have not certified that they regulate pole attachments themselves. To the extent such reports may include sensitive or confidential network or financial information, we rely upon utilities and attachers to address the issue through redactions or non-disclosure agreements.) We believe this new requirement strikes a reasonable balance between additional transparency for prospective attachers and ensuring the utilities' expenditure of resources is no greater than necessary. As discussed below, however, we also strongly encourage utilities to voluntarily share pole-related information that is reasonably available and that they track in the normal course of business, both before and after receiving attachment applications, and we intend to continue to monitor the record in this proceeding to determine if additional information sharing mandates may be required.

23. For the purposes of the new transparency requirement, a cyclical pole inspection report is any report that a utility creates in the normal course of its business that sets forth the results of the routine inspection of its poles during the utility's normal pole inspection cycle, while a periodic pole inspection report is any report that a utility creates in the normal course of its business that sets forth the results of the inspection of any of its poles outside the utility's normal pole inspection cycle. (Electric Utilities request that the new rule not require utilities to provide periodic pole inspection reports, arguing that the requirement will create confusion and invite disputes. We find that the definition of “periodic inspection report” is sufficiently clear and note that no other utility commenters claimed the definition was vague or otherwise problematic. We further find that this requirement is an important aspect of the rule. Cyclical pole inspections typically occur several years apart, sometimes by ten or more years, and periodic inspection reports will contain more recent inspection information. We also decline the Electric Utilities' request to seek further comment on transparency requirements in lieu of adopting a rule on report sharing. We find that the record is sufficient to adopt an information sharing rule at this time and the rule we adopt strikes an appropriate balance between providing attachers with additional helpful information while not being overly resource-intensive for utilities. Indeed, several utility parties are supportive of the new transparency requirement.) We note that this new transparency requirement is consistent with the existing practices of certain utilities to prepare such reports. When asking for information about the status of a utility's poles for a planned buildout, the attacher must submit its information request no earlier than contemporaneously with an attachment application. The utility will have ten business days to respond to the request. (The utility has the same amount of time to determine whether the application is complete.) This should allow sufficient time before the make-ready survey for the attacher to revise or amend its application as may be appropriate based on the information it receives. (“The term make-ready means the modification or replacement of a utility pole, or of the lines or equipment on the utility pole, to accommodate additional facilities on the utility pole.” After receiving a complete attachment application, a utility conducts a make-ready survey and provides a make-ready cost estimate to the attacher. During the survey stage, “the pole owner conducts an engineering study to determine whether and where attachment is feasible, and what make-ready is required.”)

24. We recognize that in some situations, the information provided by utilities in their pole inspection reports may lead new attachers to amend their attachment applications. In order to ensure that utilities have enough time to review such applications, in situations when the utility receives an amended attachment application prior to granting or denying the original application, we will allow a utility the option to restart the 45-day period for responding to the application on the merits and conducting the survey. (The option to restart the time period also applies to larger orders that are subject to a 60-day timeframe.) Utilities electing to restart the 45-day application review and survey period in this manner must notify the attacher within 5 business days of receipt of the amended application or by the 45th day after the original application is considered complete, whichever is earlier. (For example, if an amended application was filed on the 42nd day following the utility's determination that the original application was complete, the utility would only have three days, not five business days, to notify the attacher that the utility is restarting the 45-day application review and survey.) To avoid unnecessary delays and costs, we strongly encourage attachers to notify utilities of their intent to file, and to file, amended applications as quickly as possible after receiving a pole inspection report from the utility. We also encourage utilities to exercise their right to restart this 45-day period judiciously and to review amended applications as quickly as possible even when electing to restart the 45-day application review and survey period. (Several parties asked that we require an automatic restart of the 45-day response period or start the application process over in such instances by requiring an attacher to file a new application rather than an amended application. We decline these requests and find that the procedures we adopt are sufficiently tailored to account for the needs of utilities to review amended applications while not needlessly slowing deployment. Under the new rule, utilities will always have the option of electing to restart the 45-day review period; but given that there may be instances where an amendment is minor or otherwise will not require a restart of the 45-day period, we find it reasonable to require utilities to actually review an amended application to determine whether a restart is necessary given the specific circumstances.) Regardless of whether the utility elects to restart the 45-day response period, any additional survey costs necessitated by the amended application, such as a second survey after a survey for the original application has been completed, will be borne by the new attacher consistent with the new attacher's obligation to pay for make-ready costs associated with its application.

25. In connection with the new transparency requirement we adopt in this final rule, we also require utilities to retain copies, in whatever form they were created, of any such cyclical or periodic pole inspection reports they conduct in the normal course of business, until such time as the utility completes a superseding cyclical pole inspection report covering the poles included in the attachment application. In creating these obligations, we reiterate that utilities are required to provide only the information they already possess and track in the normal course of conducting pole inspections at the time of the attacher's request for data. The new rule does not require utilities to collect or create new information for the sole purpose of responding to such requests or to provide all information they may possess on the affected poles outside their pole inspection reports. (Edison Electric Institute contends that “access to critical infrastructure by non-electric company personnel presents serious safety, reliability, and homeland security hazards,” and that “existing law bars electric companies from releasing some information about system infrastructure.” It does not directly assert, however, that utilities would be barred from disclosing information contained in a pole inspection report. And it notes that most of the information is “already available” and an attacher “can readily learn the condition” of poles by driving a proposed route. Although we do not know exactly what information utilities may include in their pole inspection reports, we anticipate that legal constraints on disclosure of critical infrastructure information can be addressed, to the extent that they arise, by the parties involved via appropriate redactions or use of a non-disclosure agreement. We do not intend our new rule to override laws precluding disclosure of certain information, but expect utilities to work in good faith to provide potential attachers with the information they can from their pole inspection reports.) We find this new limited requirement achieves a balance between a potential attacher's need for more information about the poles that it plans to use as part of a broadband buildout and the utility's interest in minimizing the burden of mandatory disclosures.

26. We conclude that requiring utilities to provide information about the state of their poles to attachers will help improve the attachment process and potentially reduce disputes. In particular, having such information early in the process will help attachers evaluate whether they want to adjust their plans in light of the poles' conditions. At the same time, we recognize the potential burdens on utilities that would result from imposing a mandate to compile extensive information for every pole attachment application the utility receives. We seek to strike a balance by (1) requiring utilities to provide such information as they already collect in the normal course of inspections done as part of managing their network and poles (which the record indicates include which poles have been identified as needing replacement), rather than having to gather information solely for attachers or from many disparate sources, and (2) tying requests for such information to poles contained in submitted attachment applications.

27. In striking this balance, we agree with utilities that they should not be required by rule to gather and provide extensive pole-related data for every pole attachment application about matters they do not track in the normal course of business through their inspections. The record shows that many utilities do not create specific maintenance or replacement schedules for poles. It also shows that some utilities provide a range of pole-related information—including whether any poles are red-tagged or otherwise identified for replacement—when responding to an attachment application after conducting a make-ready survey. We agree with the commenters asserting that a pre-application survey conducted by the attacher, or a make-ready survey conducted by a utility in response to a specific attachment application, are often the best ways to ensure the potential attacher and utility have up-to- date, accurate information on the current state of poles. (We recognize that a visual inspection may not necessarily provide all the information an attacher might desire. This supports requiring disclosure of pole inspection reports.) We also agree with Dominion/Xcel, however, that the information contained in general survey or pole inspection reports can be useful to prospective attachers in some cases. Therefore, although we decline at this time to impose broader duties on utilities to collect and provide more expansive pole-related information for every attachment application, we will require utilities to furnish already available information in pole inspection reports concerning specific poles upon request at the time an attachment application is submitted. (Some commenters support the balance struck in this new rule. Electric Utilities, on the other hand, request that any consideration of a rule to require disclosure of pole inspection reports be deferred to a further notice of proposed rulemaking.)

28. While we do not at this time codify a requirement for utilities to provide new attachers with information about poles prior to the attacher submitting a pole attachment application, as requested by some commenters, we understand that often utilities share pole information with attachers prior to the application process, particularly information not easily attained through visual inspection. We strongly encourage this pre-application collaboration and cooperation because there is value for both utilities and attachers in having the best available pole information to inform deployment forecasts and attachment requests. Although we recognize that some potential attachers could benefit from obtaining pole-related information prior to submitting an application, we decline to impose this requirement on utilities given that the underlying requests for information would be for preliminary build-out plans that may substantially change. Furthermore, establishing a pre-application duty for utilities would require the Commission to create a new process and timeline prior to the codified make-ready process, which has always been triggered by the filing of an application. Finally, given that prospective attachers also have the ability to gather information about poles on prospective routes through pre-application surveys and visual inspection of poles on a prospective route, we find that imposing an additional pre-application requirement on utilities is not justified at this time. (Through such visual inspection, an attacher typically can learn the age of a pole, whether it has been red tagged, when the most recent inspection occurred, and a pole's load and potential suitability for more attachments. As noted above, however, we also recognize that visual inspection alone may not always provide all the information an attacher may desire, thus supporting the new requirement that utilities provide attachers with cyclical and periodic pole inspection reports. For example, with regard to utility tags on poles, Crown Castle asserts that “not all poles are appropriately tagged or inspection tags may be missing, damaged, or unable to be interpreted without additional information from the pole owner.”)

29. We reject requests at this time that we mandate a variety of other disclosure requirements on utilities. (Several attachers requested that utilities be required to provide any relevant requested information about their poles that they retain in the ordinary course of business, which would go beyond pole inspection reports. While we encourage parties to voluntarily share information, we find that codifying a broad disclosure requirement for all information collected in the ordinary course of business could force utilities to expend significant resources to gather such information and could lead to additional disputes and complaints related to information sharing.) We agree with utilities that the most relevant information for purposes of an attachment request is whether the poles at issue are available or due for replacement. (Some utilities suspect that the purpose of many of the attachers' requests is only to provide ammunition for rate disputes with utilities, not to improve the attachment process.) For example, some attacher commenters ask the Commission to require utilities to create accessible databases (or establish a single database for all utilities) with information on things like pole age, condition, repair/replacement schedules, location, number of attachments, standard rate structure, and applicable engineering standards. They also ask that utilities be required to provide data from the owners' periodic load analyses for poles; the age, height, class, and condition of poles; and data on current attachments and pending attachment requests for relevant poles. And ACA Connects asks the Commission to require utilities to provide more details in their make-ready cost estimates to support those costs. For the reasons discussed below, we decline to adopt these requirements. With respect to certain financial information requested by some commenters regarding pole rates, we do not adopt new disclosure requirements, but make clear that some financial information is already required to be disclosed under our rules.

30. Before addressing these specific proposals, however, we note some attachers express concern that, by adopting a requirement to provide pole inspection reports but not codifying additional mandates, we may be inadvertently discouraging utilities from voluntarily providing pole-related information before receiving an attachment application, which at least some utilities do today. We stress that our actions in this final rule should not be understood to undermine or disincentivize such voluntary sharing. To the contrary, voluntary sharing of pole-related information is consistent with longstanding Commission policy favoring transparency in the pole attachment context, and we strongly encourage both utilities and attachers to collaborate and voluntarily share information with each other whenever such information is reasonably available and obtained in the normal course of business. (We reject claims that our actions here are inconsistent with the policy of promoting transparency, as Crown Castle asserts. To the contrary, this Order increases transparency by adopting a new disclosure requirement.) Voluntary sharing can be helpful to both attachers and utilities to promote more efficient buildouts by informing deployment forecasts, allowing more accurate applications, and decreasing disputes or delays after an application is submitted. (Such voluntary sharing also is helpful because “not all pole owners conduct these denominated inspections,” yet attachers still could benefit from receiving the kind of information that would have been included in such inspections had they occurred.) Having better and more accurate information prior to attachment applications will likely reduce make-ready costs, the frequency and severity of disputes, and improve the efficiency of the attachment process—benefiting both attachers and utilities. We will continue to monitor the record in this proceeding and will take further action if it becomes clear that voluntary information sharing arrangements are insufficiently promoting broadband deployment.

31. Database(s) of Pole Information. We decline (1) to require that each utility create an accessible database with an array of data on all its poles, or (2) to establish a single pole-information database for all utilities. The Commission rejected previous calls for a similar database requirement in 2011, in part based on the large burden outweighing potential benefits. We find that the 2011 reasoning remains valid. In particular, we find that the record continues to demonstrate that the burdens and costs of creating such a database (if a utility does not already have one) would be very large given the number of poles many utilities own or jointly own and the scope of pole data attachers seek, and that the alleged benefits of requiring such a database would be reduced by the new requirement we adopt in this final rule that utilities provide information from their pole inspection reports. Commenters contend that requiring such a pole-related database would help speed deployment by helping attachers plan better and avoid intermediate steps for both attachers and utilities. Utilities, however, assert that due to the very large number of poles they own or co-own and the ever-changing nature of pole networks, maintaining a fully up-to-date database would be almost impossible, and so the information for any given group of poles in a database could easily be out of date when the attacher needs it. One utility also submits that granting access to such voluminous pole information could result in the submission of incorrect applications. We find that the benefits of a database requirement remain speculative at best given how difficult it would be to keep such a large database up-to-date.

32. While some commenters argue that circumstances have changed since 2011, with some state utility commissions adopting database requirements for pole-related information, the states cited by these commenters are limited and, in any event, all regulate pole attachments at the state level pursuant to section 224(c) of the Act. As a result, compliance with pre-existing state-specific database requirements would likely offer little, if any, relief in complying with a newly imposed Federal database requirement. To the extent any utilities may have developed pole-related databases in states that do not regulate pole attachments, the record indicates that attachers are interested in specific types of data, not merely access to existing databases, which would require utilities to absorb additional, and potentially substantial, costs of either adding specific types of new data or searching databases for specific data of interest to attachers. (ACA Connects asserts that many utilities have developed pole-related databases since 2011, but it does not identify utilities that have done so in states that do not regulate pole attachments.) Again, we agree with the utilities that the value of such database information to attachers is highly unlikely to outweigh those burdens, as the information may well be out of date by the time an attacher submits an attachment request. Moreover, any added benefit would likely be minimal in light of the new information-sharing requirement we adopt in this final rule.

33. Loading Studies. According to NCTA, some utilities provide and allow attachers to rely on loading studies included in the utilities' cyclical pole inspection reports rather than making the attacher do its own loading study, but other utilities do not. NCTA asserts that “[w]here such studies have been conducted, pole owners should be required to use that existing analysis rather than forcing a new attacher to incur the expense and delay of performing a duplicative and redundant study.” We decline to adopt this proposal. To the extent pole inspection reports include loading studies, attachers will have access to such information under the new rule we adopt in this final rule. (In cases where the loading study is not part of the inspection report, we decline, at this time, to codify a requirement for a utility to provide an attacher with a loading study as NCTA requests, but strongly encourage utilities to provide such loading studies when reasonably requested and readily available.) We will not, however, dictate when a utility can require a loading study, as NCTA seems to request, as we continue to believe, consistent with the 2018 Wireline Infrastructure Order, that such studies “can be important tools to address safety, reliability, and engineering concerns.” (NCTA also asserts that a utility should have to bear the cost of a loading analysis where none has been performed but the utility believes a study is necessary before allowing an attachment, and that utilities can instead recover the costs of such loading studies through annual attachment rental fees. As that issue relates to cost recovery rather than transparency, we do not address it here.)

34. Age, Height, Class, and Condition of Poles. We reject attachers' request to require utilities to provide data on the age, height, class, and condition of their poles, or the last date the pole was inspected, make-ready was conducted, or a pre-existing violation on the pole was fixed. The utilities state that they either routinely provide this type of data with make-ready estimates, that the information is accessible to attachers through their own pre-application surveys or when the attacher accompanies the utility on a make-ready survey, or that they do not track this data. To the extent utilities' pole inspection reports include such data, that information would be covered by the new transparency requirement we adopt in this final rule and available to attachers upon request after an application is filed. Given that attachers can often obtain this information either from the utility or through their own survey or inspection, we reject any additional requirement for pole condition information beyond that which we have already outlined, but we strongly encourage utilities to share this information when it is readily available and collected in the normal course of business.

35. Existing Attachments and Pending Attachment Requests. We also decline to require that utilities provide data on the number of attachments or pending attachment applications for each pole covered by an attachment request. As the utilities explain, pole networks are dynamic and pole conditions frequently change. We find that the record sufficiently demonstrates that attempting to keep a fully up-to-date list of the number of attachments or pending applications on every pole would be a very time-consuming and expensive proposition. (Some attachers also sought to require pole owners to produce information on utility transformers or voltage on a pole or the total attachment load on the pole, but utilities either deny the usefulness of such information or state that they do not track it.) Even if some utilities track this information, requiring them to compile the information and send it across a vast and shifting landscape of attachers and poles—and to keep that information updated—would be a considerable burden. Although attachers assert there would be some value in having this kind of data earlier, even if it is old, we find that, as with the proposed pole attachment database discussed above, any purported benefit is outweighed by the potentially considerable cost utilities would have to bear in complying with such a requirement.

36. Data Supporting Make-Ready Estimates. With regard to the request that utilities be required to provide more detailed supporting data in their make-ready estimates, particularly regarding the utility's costs, we again decline to adopt any new requirement. Current rules already require utilities to provide supporting cost details in their make-ready cost estimates. If utilities are not complying with those rules, attachers remain free to invoke the complaint process or seek mediation.

37. Financial Records Regarding Poles. We decline attachers' requests to create new obligations requiring utilities to provide additional financial data regarding poles and attachment rates, including outside plant records (also called continuing property records) as part of the rules being adopted at this time. (Continuing Property Records are “[o]utside plant records relevant to poles,” typically “including a detailed accounting of the units associated with accounts used to report pole plant investment such as vintage height, class, etc.” Several attachers repeated these requests in later submissions, asking that utilities be required to disclose a range of information related to rates, rather than only the information the utility relied on in computing rates, to enable attachers to, for example, evaluate the validity of utilities' reliance on presumptions in the pole attachment rate formula.) Attachers argue that such a duty for utilities to provide information will reduce rate disputes or make them easier to resolve. Our focus here, however, is on deployment rather than rate disputes. Further, § 1.1404(e) and (f) of the Commission's rules—which we do not alter here—already require that pole owners, upon request of a cable operator or telecommunications carrier, provide the information they have relied on in calculating rates, and information an attacher seeks to rely on in establishing that a rate, term, or condition is not just and reasonable. The Commission has explained that “it is critical that attaching entities have this information well in advance of executive-level discussions to ensure that those pre-complaint negotiations have a chance of success.” (NCTA contends the former language in § 1.1404(g) was inadvertently removed in a prior rule revision. We disagree. The Commission sought to “streamline the rules in [§ ] 1.1404” by removing the long list of information specified in that section but did not narrow the scope of information utilities must provide attachers. In light of these existing rules and the policy stated by the Commission in 2018, to the extent an attacher has a specific dispute with a utility, it already can seek and obtain certain financial data from the utility, prior to filing a complaint, under current rules.) We therefore decline to impose a new, broader duty to disclose additional financial records related to poles. (USTelecom, whose members include both pole owners and attachers, argues that imposing a duty beyond current law “would not accelerate broadband deployment or reduce its costs, but would likely have the opposite effect by diverting broadband providers' capital away from their own broadband deployment to subsidize their competitors' builds.”)

38. As required by the Regulatory Flexibility Act of 1980, as amended (RFA), an Initial Regulatory Flexibility Analysis (IRFA) was incorporated into the Second FNPRM. The Commission sought written public comment on the proposals in the Second FNPRM, including comment on the IRFA. No comments were filed addressing the IRFA. This present Final Regulatory Flexibility Analysis (FRFA) conforms to the RFA.

39. In the Fourth Report and Order, the Commission adopts rules and policy changes that will make the pole attachment process faster and cheaper, particularly when poles have to be replaced during broadband buildouts. In the last five years, the Commission took significant steps in setting standards for the discussions between utilities and telecommunications companies about the timing and cost of attaching broadband equipment to utility poles, with the backstop of a robust complaint process when parties cannot agree on the rates, terms, and conditions for pole attachments. In the Fourth Report and Order, we adopt rules (1) establishing a new process for the Commission's review and assessment of pole attachment disputes that impede or delay broadband deployment in order to expedite resolution of such disputes, and (2) providing telecommunications companies with information about the status of the utility poles they plan to use as they map out their broadband builds.

40. There were no comments raised that specifically addressed the proposed rules and policies presented in the Second FNPRM IRFA. Nonetheless, the Commission considered the potential impact of the rules proposed in the IRFA on small entities and took steps where appropriate and feasible to reduce the compliance burden for small entities in order to reduce the economic impact of the rules enacted herein on such entities.

41. 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 for Advocacy of the Small Business Administration (SBA), and to provide a detailed statement of any change made to the proposed rules as a result of those comments. The Chief Counsel did not file any comments in response to the proposed rules in this proceeding.

42. 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 rules adopted herein. 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. (Pursuant to 5 U.S.C. 601(3), the statutory definition of a small business applies unless an agency, after consultation with the Office of Advocacy of the Small Business Administration and after opportunity for public comment, establishes one or more definitions of such term which are appropriate to the activities of the agency and publishes such definition(s) in the Federal Register .) A “small-business concern” is one which: (1) is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the SBA.

43. Small Businesses, Small Organizations, Small Governmental Jurisdictions. Our actions, over time, may affect small entities that are not easily categorized at present. We therefore describe, 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 33.2 million businesses.

44. 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. (The IRS benchmark is similar to the population of less than 50,000 benchmark in 5 U.S.C. 601(5) that is used to define a small governmental jurisdiction. Therefore, the IRS benchmark has been used to estimate the number of small organizations in this small entity description. We note that the IRS data does not provide information on whether a small exempt organization is independently owned and operated or dominant in its field.) 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. (The IRS Exempt Organization Business Master File (E.O. BMF) Extract provides information on all registered tax-exempt/non-profit organizations. The data utilized for purposes of this description was extracted from the IRS E.O. BMF data for businesses for the tax year 2020 with revenue less than or equal to $50,000 for Region 1—Northeast Area (58,577), Region 2—Mid-Atlantic and Great Lakes Areas (175,272), and Region 3—Gulf Coast and Pacific Coast Areas (213,840) that includes the continental U.S., Alaska, and Hawaii. This data does not include information for Puerto Rico.)

45. 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 there were 90,075 local governmental jurisdictions consisting of general purpose governments and special purpose governments in the United States. (The Census of Governments survey is conducted every five (5) years compiling data for years ending with “2” and “7”.) (Local governmental jurisdictions are made up of general purpose governments (county, municipal, and town or township) and special purpose governments (special districts and independent school districts).) Of this number, there were 36,931 general purpose governments (2,105 county, 18,729 municipal, and 16,097 town and township governments) with populations of less than 50,000 and 12,040 special purpose governments (independent school districts) with enrollment populations of less than 50,000. (While the special purpose governments category also includes local special district governments, the 2017 Census of Governments data does not provide data aggregated based on population size for the special purpose governments category. Therefore, only data from independent school districts is included in the special purpose governments category.) Accordingly, based on the 2017 U.S. Census of Governments data, we estimate that at least 48,971 entities fall into the category of “small governmental jurisdictions.” (This total is derived from the sum of the number of general purpose governments (county, municipal and town or township) with populations of less than 50,000 (36,931) and the number of special purpose governments—independent school districts with enrollment populations of less than 50,000 (12,040), from the 2017 Census of Governments—Organizations tbls. 5, 6 & 10.)

46. Wired Broadband internet Access Service Providers (Wired ISPs). (Formerly included in the scope of the Internet Service Providers (Broadband), Wired Telecommunications Carriers and All Other Telecommunications small entity industry descriptions.) 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. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.)

47. Additionally, according to Commission data on internet access services as of June 30, 2019, nationwide there were approximately 2,747 providers of connections over 200 kbps in at least one direction using various wireline technologies. (The technologies used by providers include asymmetric and symmetric digital subscriber line (aDSL and sDSL) (collectively xDSL), Other Wireline, Cable Modem, and fiber to the premises (FTTP).) Other wireline includes: all copper-wire based technologies other than xDSL (such as Ethernet over copper, T-1/DS-1 and T3/DS-1) as well as power line technologies which are included in this category to maintain the confidentiality of the providers.) The Commission does not collect data on the number of employees for providers of these services, therefore, at this time we are 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 2022 Communications Marketplace Report, we believe that the majority of wireline internet access service providers can be considered small entities.

48. Internet Service Providers (Non-Broadband). Internet access service providers using client-supplied telecommunications connections ( e.g., dial-up ISPs) as well as voice over internet protocol (VoIP) service providers using client-supplied telecommunications connections fall in the industry classification of All Other Telecommunications. The SBA small business size standard for this industry classifies firms with annual receipts of $35 million or less as small. For this industry, U.S. Census Bureau data for 2017 show that there were 1,079 firms in this industry that operated for the entire year. Of those firms, 1,039 had revenue of less than $25 million. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard. We also note that according to the U.S. Census Bureau glossary, the terms receipts and revenues are used interchangeably.) Consequently, under the SBA size standard a majority of firms in this industry can be considered small.

49. Wired Telecommunications Carriers. The U.S. Census Bureau defines this industry as establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired communications networks. Transmission facilities may be based on a single technology or a combination of technologies. Establishments in this industry use the wired telecommunications network facilities that they operate to provide a variety of services, such as wired telephony services, including VoIP services, wired (cable) audio and video programming distribution, and wired broadband internet services. By exception, establishments providing satellite television distribution services using facilities and infrastructure that they operate are included in this industry. Wired Telecommunications Carriers are also referred to as wireline carriers or fixed local service providers. (Fixed Local Service Providers include the following types of providers: Incumbent Local Exchange Carriers (ILECs), Competitive Access Providers (CAPs) and Competitive Local Exchange Carriers (CLECs), Cable/Coax CLECs, Interconnected VOIP Providers, Non-Interconnected VOIP Providers, Shared-Tenant Service Providers, Audio Bridge Service Providers, and Other Local Service Providers. Local Resellers fall into another U.S. Census Bureau industry group and therefore data for these providers is not included in this industry.)

50. The SBA small business size standard for Wired Telecommunications Carriers 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. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Additionally, based on Commission data in the 2022 Universal Service Monitoring Report, as of December 31, 2021, there were 4,590 providers that reported they were engaged in the provision of fixed local services. Of these providers, the Commission estimates that 4,146 providers have 1,500 or fewer employees. Consequently, using the SBA's small business size standard, most of these providers can be considered small entities.

51. Local Exchange Carriers (LECs). Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to local exchange services. Providers of these services include both incumbent and competitive local exchange service providers. Wired Telecommunications Carriers is the closest industry with an SBA small business size standard. Wired Telecommunications Carriers are also referred to as wireline carriers or fixed local service providers. (Fixed Local Exchange Service Providers include the following types of providers: Incumbent Local Exchange Carriers (ILECs), Competitive Access Providers (CAPs) and Competitive Local Exchange Carriers (CLECs), Cable/Coax CLECs, Interconnected VOIP Providers, Non-Interconnected VOIP Providers, Shared Tenant Service Providers, Audio Bridge Service Providers, Local Resellers, and Other Local Service Providers.) The SBA small business size standard for Wired Telecommunications Carriers 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. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Additionally, based on Commission data in the 2022 Universal Service Monitoring Report, as of December 31, 2021, there were 4,590 providers that reported they were fixed local exchange service providers. Of these providers, the Commission estimates that 4,146 providers have 1,500 or fewer employees. Consequently, using the SBA's small business size standard, most of these providers can be considered small entities.

52. Incumbent Local Exchange Carriers ( Incumbent LECs ). Neither the Commission nor the SBA have developed a small business size standard specifically for incumbent local exchange carriers. Wired Telecommunications Carriers is the closest industry with an SBA small business size standard. The SBA small business size standard for Wired Telecommunications Carriers classifies firms having 1,500 or fewer employees as small. U.S. Census Bureau data for 2017 show that there were 3,054 firms in this industry that operated for the entire year. Of this number, 2,964 firms operated with fewer than 250 employees. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Additionally, based on Commission data in the 2022 Universal Service Monitoring Report, as of December 31, 2021, there were 1,212 providers that reported they were incumbent local exchange service providers. Of these providers, the Commission estimates that 916 providers have 1,500 or fewer employees. Consequently, using the SBA's small business size standard, the Commission estimates that the majority of incumbent local exchange carriers can be considered small entities.

53. Competitive Local Exchange Carriers (LECs). Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to local exchange services. Providers of these services include several types of competitive local exchange service providers. (Competitive Local Exchange Service Providers include the following types of providers: Competitive Access Providers (CAPs) and Competitive Local Exchange Carriers (CLECs), Cable/Coax CLECs, Interconnected VOIP Providers, Non-Interconnected VOIP Providers, Shared Tenant Service Providers, Audio Bridge Service Providers, Local Resellers, and Other Local Service Providers.) Wired Telecommunications Carriers is the closest industry with an SBA small business size standard. The SBA small business size standard for Wired Telecommunications Carriers 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. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Additionally, based on Commission data in the 2022 Universal Service Monitoring Report, as of December 31, 2021, there were 3,378 providers that reported they were competitive local exchange service providers. Of these providers, the Commission estimates that 3,230 providers have 1,500 or fewer employees. Consequently, using the SBA's small business size standard, most of these providers can be considered small entities.

54. Interexchange Carriers (IXCs). Neither the Commission nor the SBA has developed a small business size standard specifically for Interexchange Carriers. Wired Telecommunications Carriers is the closest industry with an SBA small business size standard. The SBA small business size standard for Wired Telecommunications Carriers 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. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Additionally, based on Commission data in the 2022 Universal Service Monitoring Report, as of December 31, 2021, there were 127 providers that reported they were engaged in the provision of interexchange services. Of these providers, the Commission estimates that 109 providers have 1,500 or fewer employees. Consequently, using the SBA's small business size standard, the Commission estimates that the majority of providers in this industry can be considered small entities.

55. Operator Service Providers ( OSPs ). Neither the Commission nor the SBA has developed a small business size standard specifically for operator service providers. The closest applicable industry with an SBA small business size standard is Wired Telecommunications Carriers. The SBA small business size standard classifies a business as small if it has 1,500 or fewer employees. U.S. Census Bureau data for 2017 show that there were 3,054 firms in this industry that operated for the entire year. Of this number, 2,964 firms operated with fewer than 250 employees. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Additionally, based on Commission data in the 2022 Universal Service Monitoring Report, as of December 31, 2021, there were 20 providers that reported they were engaged in the provision of operator services. Of these providers, the Commission estimates that all 20 providers have 1,500 or fewer employees. Consequently, using the SBA's small business size standard, all of these providers can be considered small entities.

56. Other Toll Carriers. Neither the Commission nor the SBA has developed a definition for small businesses specifically applicable to Other Toll Carriers. This category includes toll carriers that do not fall within the categories of interexchange carriers, operator service providers, prepaid calling card providers, satellite service carriers, or toll resellers. Wired Telecommunications Carriers is the closest industry with an SBA small business size standard. The SBA small business size standard for Wired Telecommunications Carriers classifies firms having 1,500 or fewer employees as small. U.S. Census Bureau data for 2017 show that there were 3,054 firms in this industry that operated for the entire year. Of this number, 2,964 firms operated with fewer than 250 employees. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Additionally, based on Commission data in the 2022 Universal Service Monitoring Report, as of December 31, 2021, there were 90 providers that reported they were engaged in the provision of other toll services. Of these providers, the Commission estimates that 87 providers have 1,500 or fewer employees. Consequently, using the SBA's small business size standard, most of these providers can be considered small entities.

57. The broadband internet access service provider category covered by these new rules may cover multiple wireless firms and categories of regulated wireless services. (This includes, among others, the approximately 800 members of the Wireless internet Service Providers Association (WISPA), including those entities who provide fixed wireless broadband service using unlicensed spectrum. We also consider the impact to these entities for the purposes of this FRFA, by including them under the “Wireless Providers—Fixed and Mobile” category.) Thus, to the extent the wireless services listed below are used by wireless firms for broadband internet access service, the actions may have an impact on those small businesses as set forth above and further below. In addition, for those services subject to auctions, we note that, as a general matter, the number of winning bidders that claim to qualify as small businesses at the close of an auction does not necessarily represent the number of small businesses currently in service. Also, the Commission does not generally track subsequent business size unless, in the context of assignments and transfers or reportable eligibility events, unjust enrichment issues are implicated.

58. Wireless Telecommunications Carriers (except Satellite) . This industry comprises establishments engaged in operating and maintaining switching and transmission facilities to provide communications via the airwaves. Establishments in this industry have spectrum licenses and provide services using that spectrum, such as cellular services, paging services, wireless internet access, and wireless video services. 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. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Additionally, based on Commission data in the 2022 Universal Service Monitoring Report, as of December 31, 2021, there were 594 providers that reported they were engaged in the provision of wireless services. Of these providers, the Commission estimates that 511 providers have 1,500 or fewer employees. Consequently, using the SBA's small business size standard, most of these providers can be considered small entities.

59. Wireless Communications Services. Wireless Communications Services (WCS) can be used for a variety of fixed, mobile, radiolocation, and digital audio broadcasting satellite services. Wireless spectrum is made available and licensed for the provision of wireless communications services in several frequency bands subject to part 27 of the Commission's rules. Wireless Telecommunications Carriers (except Satellite) is the closest industry with an SBA small business size standard applicable to these services. The SBA small business 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 that operated in this industry for the entire year. Of this number, 2,837 firms employed fewer than 250 employees. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Thus, under the SBA size standard, the Commission estimates that a majority of licensees in this industry can be considered small.

60. The Commission's small business size standards with respect to WCS involve eligibility for bidding credits and installment payments in the auction of licenses for the various frequency bands included in WCS. When bidding credits are adopted for the auction of licenses in WCS frequency bands, such credits may be available to several types of small businesses based average gross revenues (small, very small and entrepreneur) pursuant to the competitive bidding rules adopted in conjunction with the requirements for the auction and/or as identified in the designated entities section in part 27 of the Commission's rules for the specific WCS frequency bands. (The Designated entities sections in subparts D through Q each contain the small business size standards adopted for the auction of the frequency band covered by that subpart.)

61. In frequency bands where licenses were subject to auction, the Commission notes that as a general matter, the number of winning bidders that qualify as small businesses at the close of an auction does not necessarily represent the number of small businesses currently in service. Further, the Commission does not generally track subsequent business size unless, in the context of assignments or transfers, unjust enrichment issues are implicated. Additionally, since the Commission does not collect data on the number of employees for licensees providing these services, at this time we are not able to estimate the number of licensees with active licenses that would qualify as small under the SBA's small business size standard.

62. 1670-1675 MHz Services. These wireless communications services can be used for fixed and mobile uses, except aeronautical mobile. Wireless Telecommunications Carriers (except Satellite) is the closest industry with an SBA small business size standard applicable to these services. 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 that operated in this industry for the entire year. Of this number, 2,837 firms employed fewer than 250 employees. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Thus, under the SBA size standard, the Commission estimates that a majority of licensees in this industry can be considered small.

63. According to Commission data as of November 2021, there were three active licenses in this service. (Based on an FCC Universal Licensing System search on November 8, 2021, search parameters: Service Group = All, “Match only the following radio service(s)”, Radio Service = BC; Authorization Type = All; Status = Active. We note that the number of active licenses does not equate to the number of licensees. A licensee can have one or more licenses.) The Commission's small business size standards with respect to 1670-1675 MHz Services involve eligibility for bidding credits and installment payments in the auction of licenses for these services. For licenses in the 1670-1675 MHz service band, a “small business” is defined as an entity that, together with its affiliates and controlling interests, has average gross revenues not exceeding $40 million for the preceding three years, and a “very small business” is defined as an entity that, together with its affiliates and controlling interests, has had average annual gross revenues not exceeding $15 million for the preceding three years. The 1670-1675 MHz service band auction's winning bidder did not claim small business status.

64. In frequency bands where licenses were subject to auction, the Commission notes that as a general matter, the number of winning bidders that qualify as small businesses at the close of an auction does not necessarily represent the number of small businesses currently in service. Further, the Commission does not generally track subsequent business size unless, in the context of assignments or transfers, unjust enrichment issues are implicated. Additionally, since the Commission does not collect data on the number of employees for licensees providing these services, at this time we are not able to estimate the number of licensees with active licenses that would qualify as small under the SBA's small business size standard.

65. Wireless Telephony. Wireless telephony includes cellular, personal communications services, and specialized mobile radio telephony carriers. The closest applicable industry with an SBA small business size standard is Wireless Telecommunications Carriers (except Satellite). The size standard for this industry under SBA rules is that a business is small if it has 1,500 or fewer employees. For this industry, U.S. Census Bureau data for 2017 show that there were 2,893 firms that operated for the entire year. Of this number, 2,837 firms employed fewer than 250 employees. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Additionally, based on Commission data in the 2022 Universal Service Monitoring Report, as of December 31, 2021, there were 331 providers that reported they were engaged in the provision of cellular, personal communications services, and specialized mobile radio services. Of these providers, the Commission estimates that 255 providers have 1,500 or fewer employees. Consequently, using the SBA's small business size standard, most of these providers can be considered small entities.

66. Broadband Personal Communications Service. The broadband personal communications services (PCS) spectrum encompasses services in the 1850-1910 and 1930-1990 MHz bands. The closest industry with an SBA small business size standard applicable to these services is Wireless Telecommunications Carriers (except Satellite). The SBA small business 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 that operated in this industry for the entire year. Of this number, 2,837 firms employed fewer than 250 employees. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Thus, under the SBA size standard, the Commission estimates that a majority of licensees in this industry can be considered small.

67. Based on Commission data as of November 2021, there were approximately 5,060 active licenses in the Broadband PCS service. (Based on an FCC Universal Licensing System search on November 16, 2021, search parameters: Service Group = All, “Match only the following radio service(s)”, Radio Service = CW; Authorization Type = All; Status = Active. We note that the number of active licenses does not equate to the number of licensees. A licensee can have one or more licenses.) The Commission's small business size standards with respect to Broadband PCS involve eligibility for bidding credits and installment payments in the auction of licenses for these services. In auctions for these licenses, the Commission defined “small business” as an entity that, together with its affiliates and controlling interests, has average gross revenues not exceeding $40 million for the preceding three years, and a “very small business” as an entity that, together with its affiliates and controlling interests, has had average annual gross revenues not exceeding $15 million for the preceding three years. Winning bidders claiming small business credits won Broadband PCS licenses in C, D, E, and F Blocks.

68. In frequency bands where licenses were subject to auction, the Commission notes that as a general matter, the number of winning bidders that qualify as small businesses at the close of an auction does not necessarily represent the number of small businesses currently in service. Further, the Commission does not generally track subsequent business size unless, in the context of assignments or transfers, unjust enrichment issues are implicated. Additionally, since the Commission does not collect data on the number of employees for licensees providing these, at this time we are not able to estimate the number of licensees with active licenses that would qualify as small under the SBA's small business size standard.

69. Specialized Mobile Radio Licenses. Special Mobile Radio (SMR) licenses allow licensees to provide land mobile communications services (other than radiolocation services) in the 800 MHz and 900 MHz spectrum bands on a commercial basis including but not limited to services used for voice and data communications, paging, and facsimile services, to individuals, Federal Government entities, and other entities licensed under part 90 of the Commission's rules. Wireless Telecommunications Carriers (except Satellite) is the closest industry with an SBA small business size standard applicable to these services. The SBA size standard for this industry classifies a business as small if it has 1,500 or fewer employees. For this industry, U.S. Census Bureau data for 2017 show that there were 2,893 firms in this industry that operated for the entire year. Of this number, 2,837 firms employed fewer than 250 employees. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Additionally, based on Commission data in the 2022 Universal Service Monitoring Report, as of December 31, 2021, there were 95 providers that reported they were of SMR (dispatch) providers. Of this number, the Commission estimates that all 95 providers have 1,500 or fewer employees. Consequently, using the SBA's small business size standard, these 119 SMR licensees can be considered small entities. (We note that there were also SMR providers reporting in the “Cellular/PCS/SMR” classification, therefore there are maybe additional SMR providers that have not been accounted for in the SMR (dispatch) classification.)

70. Based on Commission data as of December 2021, there were 3,924 active SMR licenses. (Based on an FCC Universal Licensing System search on December 15, 2021, search parameters: Service Group = All, “Match radio services within this group”, Radio Service = SMR; Authorization Type = All; Status = Active. We note that the number of active licenses does not equate to the number of licensees. A licensee can have one or more licenses.) However, since the Commission does not collect data on the number of employees for licensees providing SMR services, at this time we are not able to estimate the number of licensees with active licenses that would qualify as small under the SBA's small business size standard. Nevertheless, for purposes of this analysis the Commission estimates that the majority of SMR licensees can be considered small entities using the SBA's small business size standard.

71. Lower 700 MHz Band Licenses. The lower 700 MHz band encompasses spectrum in the 698-746 MHz frequency bands. Permissible operations in these bands include flexible fixed, mobile, and broadcast uses, including mobile and other digital new broadcast operation; fixed and mobile wireless commercial services (including frequency division duplex (FDD)- and time division duplex (TDD)-based services); as well as fixed and mobile wireless uses for private, internal radio needs, two-way interactive, cellular, and mobile television broadcasting services. Wireless Telecommunications Carriers (except Satellite) is the closest industry with an SBA small business size standard applicable to licenses providing services in these bands. The SBA small business 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 that operated in this industry for the entire year. Of this number, 2,837 firms employed fewer than 250 employees. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Thus, under the SBA size standard, the Commission estimates that a majority of licensees in this industry can be considered small.

72. According to Commission data as of December 2021, there were approximately 2,824 active Lower 700 MHz Band licenses. (Based on an FCC Universal Licensing System search on December 14, 2021, search parameters: Service Group = All, “Match only the following radio service(s)”, Radio Service = WY, WZ; Authorization Type = All; Status = Active. We note that the number of active licenses does not equate to the number of licensees. A licensee can have one or more licenses.) The Commission's small business size standards with respect to Lower 700 MHz Band licensees involve eligibility for bidding credits and installment payments in the auction of licenses. For auctions of Lower 700 MHz Band licenses the Commission adopted criteria for three groups of small businesses. A very small business was defined as an entity that, together with its affiliates and controlling interests, has average annual gross revenues not exceeding $15 million for the preceding three years, a small business was defined as an entity that, together with its affiliates and controlling interests, has average gross revenues not exceeding $40 million for the preceding three years, and an entrepreneur was defined as an entity that, together with its affiliates and controlling interests, has average gross revenues not exceeding $3 million for the preceding three years. In auctions for Lower 700 MHz Band licenses seventy-two winning bidders claiming a small business classification won 329 licenses, twenty-six winning bidders claiming a small business classification won 214 licenses, and three winning bidders claiming a small business classification won all five auctioned licenses.

73. In frequency bands where licenses were subject to auction, the Commission notes that as a general matter, the number of winning bidders that qualify as small businesses at the close of an auction does not necessarily represent the number of small businesses currently in service. Further, the Commission does not generally track subsequent business size unless, in the context of assignments or transfers, unjust enrichment issues are implicated. Additionally, since the Commission does not collect data on the number of employees for licensees providing these services, at this time we are not able to estimate the number of licensees with active licenses that would qualify as small under the SBA's small business size standard.

74. Upper 700 MHz Band Licenses. The upper 700 MHz band encompasses spectrum in the 746-806 MHz bands. Upper 700 MHz D Block licenses are nationwide licenses associated with the 758-763 MHz and 788-793 MHz bands. Permissible operations in these bands include flexible fixed, mobile, and broadcast uses, including mobile and other digital new broadcast operation; fixed and mobile wireless commercial services (including FDD- and TDD-based services); as well as fixed and mobile wireless uses for private, internal radio needs, two-way interactive, cellular, and mobile television broadcasting services. (We note that in Auction 73, Upper 700 MHz Band C and D Blocks as well as Lower 700 MHz Band A, B, and E Blocks were auctioned.) Wireless Telecommunications Carriers ( except Satellite) is the closest industry with an SBA small business size standard applicable to licenses providing services in these bands. The SBA small business 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 that operated in this industry for the entire year. Of that number, 2,837 firms employed fewer than 250 employees. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Thus, under the SBA size standard, the Commission estimates that a majority of licensees in this industry can be considered small.

75. According to Commission data as of December 2021, there were approximately 152 active Upper 700 MHz Band licenses. (Based on an FCC Universal Licensing System search on December 14, 2021, search parameters: Service Group = All, “Match only the following radio service(s)”, Radio Service = WP, WU; Authorization Type = All; Status = Active. We note that the number of active licenses does not equate to the number of licensees. A licensee can have one or more licenses.) The Commission's small business size standards with respect to Upper 700 MHz Band licensees involve eligibility for bidding credits and installment payments in the auction of licenses. For the auction of these licenses, the Commission defined a “small business” as an entity that, together with its affiliates and controlling principals, has average gross revenues not exceeding $40 million for the preceding three years, and a “very small business” an entity that, together with its affiliates and controlling principals, has average gross revenues that are not more than $15 million for the preceding three years. Pursuant to these definitions, three winning bidders claiming very small business status won five of the twelve available licenses.

76. Air-Ground Radiotelephone Service. Air-Ground Radiotelephone Service is a wireless service in which licensees are authorized to offer and provide radio telecommunications service for hire to subscribers in aircraft. A licensee may provide any type of air-ground service ( i.e., voice telephony, broadband internet, data, etc.) to aircraft of any type, and serve any or all aviation markets (commercial, government, and general). A licensee must provide service to aircraft and may not provide ancillary land mobile or fixed services in the 800 MHz air-ground spectrum.

77. The closest industry with an SBA small business size standard applicable to these services is Wireless Telecommunications Carriers (except Satellite). The SBA small business 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 that operated in this industry for the entire year. Of this number, 2,837 firms employed fewer than 250 employees. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Thus, under the SBA size standard, the Commission estimates that a majority of licensees in this industry can be considered small.

78. Based on Commission data as of December 2021, there were approximately four licensees with 110 active licenses in the Air-Ground Radiotelephone Service. (Based on an FCC Universal Licensing System search on December 20, 2021, search parameters: Service Group = All, “Match only the following radio service(s)”, Radio Service = CG, CJ; Authorization Type = All; Status = Active. We note that the number of active licenses does not equate to the number of licensees. A licensee can have one or more licenses.) The Commission's small business size standards with respect to Air-Ground Radiotelephone Service involve eligibility for bidding credits and installment payments in the auction of licenses. For purposes of auctions, the Commission defined “small business” as an entity that, together with its affiliates and controlling interests, has average gross revenues not exceeding $40 million for the preceding three years, and a “very small business” as an entity that, together with its affiliates and controlling interests, has had average annual gross revenues not exceeding $15 million for the preceding three years. In the auction of Air-Ground Radiotelephone Service licenses in the 800 MHz band, neither of the two winning bidders claimed small business status.

79. In frequency bands where licenses were subject to auction, the Commission notes that as a general matter, the number of winning bidders that qualify as small businesses at the close of an auction does not necessarily represent the number of small businesses currently in service. Further, the Commission does not generally track subsequent business size unless, in the context of assignments or transfers, unjust enrichment issues are implicated. Additionally, the Commission does not collect data on the number of employees for licensees providing these services therefore, at this time we are not able to estimate the number of licensees with active licenses that would qualify as small under the SBA's small business size standard.

80. 3650-3700 MHz band. Wireless broadband service licensing in the 3650-3700 MHz band provides for nationwide, non-exclusive licensing of terrestrial operations, utilizing contention-based technologies, in the 3650 MHz band ( i.e., 3650-3700 MHz). Licensees are permitted to provide services on a non-common carrier and/or on a common carrier basis. Wireless broadband services in the 3650-3700 MHz band fall in the Wireless Telecommunications Carriers (except Satellite) industry with an SBA small business size standard that 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 that operated in this industry for the entire year. Of this number, 2,837 firms employed fewer than 250 employees. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Thus, under the SBA size standard, the Commission estimates that a majority of licensees in this industry can be considered small.

81. The Commission has not developed a small business size standard applicable to 3650-3700 MHz band licensees. Based on the licenses that have been granted, however, we estimate that the majority of licensees in this service are small internet Access Service Providers (ISPs). As of November 2021, Commission data shows that there were 902 active licenses in the 3650-3700 MHz band. (Based on an FCC Universal Licensing System search on November 19, 2021, search parameters: Service Group = All, “Match only the following radio service(s)”, Radio Service = NN; Authorization Type =All; Status = Active. We note that the number of active licenses does not equate to the number of licensees. A licensee can have one or more licenses.) However, since the Commission does not collect data on the number of employees for licensees providing these services, at this time we are not able to estimate the number of licensees with active licenses that would qualify as small under the SBA's small business size standard.

82. Fixed Microwave Services. Fixed microwave services include common carrier, private-operational fixed, and broadcast auxiliary radio services. (Auxiliary Microwave Service is governed by part 74 of title 47 of the Commission's Rules. Available to licensees of broadcast stations and to broadcast and cable network entities, broadcast auxiliary microwave stations are used for relaying broadcast television signals from the studio to the transmitter, or between two points such as a main studio and an auxiliary studio. The service also includes mobile TV pickups, which relay signals from a remote location back to the studio.) They also include the Upper Microwave Flexible Use Service (UMFUS), Millimeter Wave Service (70/80/90 GHz), Local Multipoint Distribution Service (LMDS), the Digital Electronic Message Service (DEMS), 24 GHz Service, Multiple Address Systems (MAS), and Multichannel Video Distribution and Data Service (MVDDS), where in some bands licensees can choose between common carrier and non-common carrier status. Wireless Telecommunications Carriers (except Satellite) is the closest industry with an SBA small business size standard applicable to these services. The SBA small 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 that operated in this industry for the entire year. Of this number, 2,837 firms employed fewer than 250 employees. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Thus, under the SBA size standard, the Commission estimates that a majority of fixed microwave service licensees can be considered small.

83. The Commission's small business size standards with respect to fixed microwave services involve eligibility for bidding credits and installment payments in the auction of licenses for the various frequency bands included in fixed microwave services. When bidding credits are adopted for the auction of licenses in fixed microwave services frequency bands, such credits may be available to several types of small businesses based average gross revenues (small, very small and entrepreneur) pursuant to the competitive bidding rules adopted in conjunction with the requirements for the auction and/or as identified in part 101 of the Commission's rules for the specific fixed microwave services frequency bands.

84. In frequency bands where licenses were subject to auction, the Commission notes that as a general matter, the number of winning bidders that qualify as small businesses at the close of an auction does not necessarily represent the number of small businesses currently in service. Further, the Commission does not generally track subsequent business size unless, in the context of assignments or transfers, unjust enrichment issues are implicated. Additionally, since the Commission does not collect data on the number of employees for licensees providing these services, at this time we are not able to estimate the number of licensees with active licenses that would qualify as small under the SBA's small business size standard.

85. Broadband Radio Service and Educational Broadband Service. Broadband Radio Service systems, previously referred to as Multipoint Distribution Service (MDS) and Multichannel Multipoint Distribution Service (MMDS) systems, and “wireless cable,” transmit video programming to subscribers and provide two-way high speed data operations using the microwave frequencies of the Broadband Radio Service (BRS) and Educational Broadband Service (EBS) (previously referred to as the Instructional Television Fixed Service (ITFS)). (The use of the term “wireless cable” does not imply that it constitutes cable television for statutory or regulatory purposes.) Wireless cable operators that use spectrum in the BRS often supplemented with leased channels from the EBS, provide a competitive alternative to wired cable and other multichannel video programming distributors. Wireless cable programming to subscribers resembles cable television, but instead of coaxial cable, wireless cable uses microwave channels. (Generally, a wireless cable system may be described as a microwave station transmitting on a combination of BRS and EBS channels to numerous receivers with antennas, such as single-family residences, apartment complexes, hotels, educational institutions, business entities and governmental offices. The range of the transmission depends upon the transmitter power, the type of receiving antenna and the existence of a line-of-sight path between the transmitter or signal booster and the receiving antenna.)

86. In light of the use of wireless frequencies by BRS and EBS services, the closest industry with an SBA small business size standard applicable to these services is Wireless Telecommunications Carriers (except Satellite). The SBA small business 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 that operated in this industry for the entire year. Of this number, 2,837 firms employed fewer than 250 employees. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Thus, under the SBA size standard, the Commission estimates that a majority of licensees in this industry can be considered small.

87. According to Commission data as December 2021, there were approximately 5,869 active BRS and EBS licenses. (Based on an FCC Universal Licensing System search on December 10, 2021, search parameters: Service Group = All, “Match only the following radio service(s)”, Radio Service = BR, ED; Authorization Type = All; Status = Active. We note that the number of active licenses does not equate to the number of licensees. A licensee can have one or more licenses.) The Commission's small business size standards with respect to BRS involves eligibility for bidding credits and installment payments in the auction of licenses for these services. For the auction of BRS licenses, the Commission adopted criteria for three groups of small businesses. A very small business is an entity that, together with its affiliates and controlling interests, has average annual gross revenues exceed $3 million and did not exceed $15 million for the preceding three years, a small business is an entity that, together with its affiliates and controlling interests, has average gross revenues exceed $15 million and did not exceed $40 million for the preceding three years, and an entrepreneur is an entity that, together with its affiliates and controlling interests, has average gross revenues not exceeding $3 million for the preceding three years. Of the ten winning bidders for BRS licenses, two bidders claiming the small business status won 4 licenses, one bidder claiming the very small business status won three licenses and two bidders claiming entrepreneur status won six licenses. One of the winning bidders claiming a small business status classification in the BRS license auction has an active license as of December 2021. (We note that the number of active licenses does not equate to the number of licensees. A licensee can have one or more licenses.) We note that the number of active licenses does not equate to the number of licensees. A licensee can have one or more licenses.

88. The Commission's small business size standards for EBS define a small business as an entity that, together with its affiliates, its controlling interests and the affiliates of its controlling interests, has average gross revenues that are not more than $55 million for the preceding five (5) years, and a very small business is an entity that, together with its affiliates, its controlling interests and the affiliates of its controlling interests, has average gross revenues that are not more than $20 million for the preceding five (5) years. In frequency bands where licenses were subject to auction, the Commission notes that as a general matter, the number of winning bidders that qualify as small businesses at the close of an auction does not necessarily represent the number of small businesses currently in service. Further, the Commission does not generally track subsequent business size unless, in the context of assignments or transfers, unjust enrichment issues are implicated. Additionally, since the Commission does not collect data on the number of employees for licensees providing these services, at this time we are not able to estimate the number of licensees with active licenses that would qualify as small under the SBA's small business size standard.

89. Satellite Telecommunications. This industry comprises firms primarily engaged in providing telecommunications services to other establishments in the telecommunications and broadcasting industries by forwarding and receiving communications signals via a system of satellites or reselling satellite telecommunications. Satellite telecommunications service providers include satellite and earth station operators. The SBA small business size standard for this industry classifies a business with $35 million or less in annual receipts as small. U.S. Census Bureau data for 2017 show that 275 firms in this industry operated for the entire year. Of this number, 242 firms had revenue of less than $25 million. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard. We also note that according to the U.S. Census Bureau glossary, the terms receipts and revenues are used interchangeably.) Additionally, based on Commission data in the 2022 Universal Service Monitoring Report, as of December 31, 2021, there were 65 providers that reported they were engaged in the provision of satellite telecommunications services. Of these providers, the Commission estimates that approximately 42 providers have 1,500 or fewer employees. Consequently, using the SBA's small business size standard, a little more than half of these providers can be considered small entities.

90. All Other Telecommunications. This industry is comprised of establishments primarily engaged in providing specialized telecommunications services, such as satellite tracking, communications telemetry, and radar station operation. This industry also includes establishments primarily engaged in providing satellite terminal stations and associated facilities connected with one or more terrestrial systems and capable of transmitting telecommunications to, and receiving telecommunications from, satellite systems. Providers of internet services ( e.g., dial-up ISPs) or voice over internet protocol (VoIP) services, via client-supplied telecommunications connections are also included in this industry. The SBA small business size standard for this industry classifies firms with annual receipts of $35 million or less as small. U.S. Census Bureau data for 2017 show that there were 1,079 firms in this industry that operated for the entire year. Of those firms, 1,039 had revenue of less than $25 million. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard. We also note that according to the U.S. Census Bureau glossary, the terms receipts and revenues are used interchangeably.) Based on this data, the Commission estimates that the majority of “All Other Telecommunications” firms can be considered small.

91. Because section 706 of the Act requires us to monitor the deployment of broadband using any technology, we anticipate that some broadband service providers may not provide telephone service. Accordingly, we describe below other types of firms that may provide broadband services, including cable companies, MDS providers, and utilities, among others.

92. Cable and Other Subscription Programming. The U.S. Census Bureau defines this industry as establishments primarily engaged in operating studios and facilities for the broadcasting of programs on a subscription or fee basis. The broadcast programming is typically narrowcast in nature ( e.g., limited format, such as news, sports, education, or youth-oriented). These establishments produce programming in their own facilities or acquire programming from external sources. The programming material is usually delivered to a third party, such as cable systems or direct-to-home satellite systems, for transmission to viewers. The SBA small business size standard for this industry classifies firms with annual receipts less than $41.5 million as small. Based on U.S. Census Bureau data for 2017, 378 firms operated in this industry during that year. (The U.S. Census Bureau withheld publication of the number of firms that operated for the entire year to avoid disclosing data for individual companies (see Cell Notes for this category).) Of that number, 149 firms operated with revenue of less than $25 million a year and 44 firms operated with revenue of $25 million or more. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard. We note that the U.S. Census Bureau withheld publication of the number of firms that operated with sales/value of shipments/revenue in all categories of revenue less than $500,000 to avoid disclosing data for individual companies (see Cell Notes for the sales/value of shipments/revenue in these categories). Therefore, the number of firms with revenue that meet the SBA size standard would be higher than noted herein. We also note that according to the U.S. Census Bureau glossary, the terms receipts and revenues are used interchangeably.) Based on this data, the Commission estimates that a majority of firms in this industry are small.

93. Cable Companies and Systems (Rate Regulation). The Commission has developed its own small business size standard for the purpose of cable rate regulation. Under the Commission's rules, a “small cable company” is one serving 400,000 or fewer subscribers nationwide. Based on industry data, there are about 420 cable companies in the U.S. Of these, only seven have more than 400,000 subscribers. In addition, under the Commission's rules, a “small system” is a cable system serving 15,000 or fewer subscribers. Based on industry data, there are about 4,139 cable systems (headends) in the U.S. Of these, about 639 have more than 15,000 subscribers. Accordingly, the Commission estimates that the majority of cable companies and cable systems are small.

94. Cable System Operators (Telecom Act Standard). The Communications Act of 1934, as amended, contains a size standard for a “small cable operator,” which is a cable operator that, directly or through an affiliate, serves in the aggregate fewer than one percent of all subscribers in the United States and is not affiliated with any entity or entities whose gross annual revenues in the aggregate exceed $250,000,000. For purposes of the Telecom Act Standard, the Commission determined that a cable system operator that serves fewer than 498,000 subscribers, either directly or through affiliates, will meet the definition of a small cable operator. (In the 2023 Subscriber Threshold Public Notice, the Commission determined that there were approximately 49.8 million cable subscribers in the United States at that time using the most reliable source publicly available. This threshold will remain in effect until the Commission issues a superseding Public Notice.) Based on industry data, only six cable system operators have more than 498,000 subscribers. Accordingly, the Commission estimates that the majority of cable system operators are small under this size standard. We note however, that the Commission neither requests nor collects information on whether cable system operators are affiliated with entities whose gross annual revenues exceed $250 million. (The Commission does receive such information on a case-by-case basis if a cable operator appeals a local franchise authority's finding that the operator does not qualify as a small cable operator pursuant to § 76.901(e) of the Commission's rules.) Therefore, we are unable at this time to estimate with greater precision the number of cable system operators that would qualify as small cable operators under the definition in the Communications Act.

95. Electric Power Generators, Transmitters, and Distributors. The U.S. Census Bureau defines the utilities sector industry as comprised of establishments, primarily engaged in generating, transmitting, and/or distributing electric power. Establishments in this industry group may perform one or more of the following activities: (1) operate generation facilities that produce electric energy; (2) operate transmission systems that convey the electricity from the generation facility to the distribution system; and (3) operate distribution systems that convey electric power received from the generation facility or the transmission system to the final consumer. This industry group is categorized based on fuel source and includes Hydroelectric Power Generation, Fossil Fuel Electric Power Generation, Nuclear Electric Power Generation, Solar Electric Power Generation, Wind Electric Power Generation, Geothermal Electric Power Generation, Biomass Electric Power Generation, Other Electric Power Generation, Electric Bulk Power Transmission and Control, and Electric Power Distribution.

96. The SBA has established a small business size standard for each of these groups based on the number of employees which ranges from having fewer than 250 employees to having fewer than 1,000 employees. U.S. Census Bureau data for 2017 indicate that for the Electric Power Generation, Transmission, and Distribution industry there were 1,693 firms that operated in this industry for the entire year. Of this number, 1,552 firms had less than 250 employees. (The available U.S. Census Bureau data does not provide a more precise estimate of the number of firms that meet the SBA size standard.) Based on this data and the associated SBA size standards, the majority of firms in this industry can be considered small entities.

97. In the Fourth Report and Order, we (1) establish a new process for the Commission's review and assessment of pole attachment disputes that impede or delay broadband deployment in order to expedite resolution of such disputes, and (2) adopt a new requirement that utilities retain copies of their cyclical pole inspection reports and, upon request, provide prospective pole attachers with the information included in the most recent report regarding the poles affected by a prospective attacher's submitted attachment application. Our new requirements are minimally burdensome as they merely require (1) parties seeking to have complaints placed on the Accelerated Docket to submit a form to the newly-established Rapid Broadband Assessment Team (RBAT) that will elicit information relevant to the scope and nature of the dispute and to whether the dispute is appropriate for expedited mediation and/or placement on the Accelerated Docket, and (2) utilities to provide information they already collect in the normal course of business for cyclical pole inspection reports.

98. Parties seeking both RBAT review and assessment of a dispute that a party contends is impeding or delaying deployment of broadband facilities, and inclusion of a proceeding relating to broadband facilities deployment on the Accelerated Docket, the party must first notify the Chief of the Enforcement Bureau's Market Disputes Resolution Division (MDRD) of the request by phone and in writing. This initial notification by phone and in writing would need to be made prior to filing the formal complaint and would constitute the notification required under § 1.736(b). Additionally, the RBAT may require that the parties participate, if appropriate, in pre-filing settlement negotiations or mediation under § 1.737 as a condition for including a matter on the Accelerated Docket. We amend our pole attachment make-ready rules to require utilities to provide to potential attachers, upon request, the information contained in their most recent cyclical pole inspection reports, or any intervening, periodic reports created before the next cyclical inspection, for the poles covered by a submitted attachment application, including whether any of the affected poles have been “red tagged” by the utility for replacement, and the scheduled replacement date or timeframe. The record indicates that utilities already prepare such reports, making this new transparency requirement consistent with the existing practices. For these reasons, we believe that small and other utilities will not have an issue complying with the new obligation.

99. The Commission does not have sufficient information on the record to determine whether small entities will be required to hire professionals to comply with its decisions, or to quantify the cost of compliance for small entities with the Fourth Report and Order. While some small entities may have some unique burdens, the Commission anticipates the requirements for pole attachment disputes and data collection by utility companies will have minimal cost implications because many of these obligations are consistent with existing Commission regulations to file disputes, and existing practices by utilities to prepare pole inspection reports.

100. The RFA requires an agency to provide a description of the steps the agency has taken to minimize the significant economic impact on small entities including a statement of the factual, policy, and legal reasons for selecting the alternative adopted in the final rule and why each one of the other significant alternatives to the rule considered by the agency which affect the impact on small entities was rejected.

101. The Commission took steps to minimize significant economic impact on small entities and considered alternatives to new rules and processes adopted in the Fourth Report and Order that may impact small entities. By establishing the RBAT, we addressed commenters' request that we expedite the resolution of pole attachment disputes, the delay of which may impose greater harm on small providers. In considering alternatives to the rules, we declined to adopt certain proposals that are burdensome, unnecessary, or would impose significant costs on utilities with little or no benefit to broadband deployment. For example, we agreed with utilities that they should not be required to gather and provide pole-related data for matters they do not track in the normal course of business through their inspections. We also declined to require that small and other utilities provide new attachers with information about poles prior to the attacher submitting an application because this data would be speculative and the build-out may never occur. Additionally, we declined to establish a single pole-information database or require each utility to create a database of all its poles. Similar to our prior decisions on this matter, the record demonstrates that the burdens and costs of creating such a database are considerable given that many utilities own or jointly own poles. Further, the scope of pole data attachers seek exists in information from pole inspection reports we require small and other utility companies to provide in the Fourth Report and Order. We considered and declined to require small and other utilities to provide financial data regarding poles and attachment rates because this would be overly burdensome for the utilities. We also considered but declined to require small and other utilities to provide information on the age or condition of the poles, or number of current or pending attachment applications for each pole because it could be burdensome, unnecessary, or unfeasible in some cases, and would impose significant costs on utilities with little or no benefit to broadband deployment. Finally, we declined to require small and other utilities to provide more detailed supporting data in their make ready estimates because the current complaint process should be sufficient to address a potential dispute on this matter.

102. The Commission will send a copy of the Fourth Report and Order, including the FRFA, in a report to be sent to Congress and the Government Accountability Office pursuant to the Congressional Review Act. In addition, the Commission will send a copy of the Fourth Report and Order and Declaratory Ruling, including the FRFA, to the Chief Counsel for Advocacy of the Small Business Administration. A copy of the Fourth Report and Order (or summaries thereof) will also be published in the Federal Register .

103. Regulatory Flexibility Act. The Regulatory Flexibility Act of 1980, as amended (RFA), requires that an agency prepare a regulatory flexibility analysis for notice and comment rulemakings, unless the agency certifies that the rule will not, if promulgated, have a significant economic impact on a substantial number of small entities. Accordingly, we have prepared a Final Regulatory Flexibility Analysis (FRFA) concerning the possible impact of the rule changes contained in the Fourth Report and Order on small entities. The FRFA is set forth herein.

104. Congressional Review Act. The Commission will send a copy of the Fourth Report and Order to Congress and the Government Accountability Office pursuant to 5 U.S.C. 801(a)(1)(A).

105. Paperwork Reduction Act. This document may contain proposed new or modified information collection requirements subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. Specifically, the rules adopted in 47 CFR 1.1411, 1.1415, and 1.1416 may require new or modified information collections. All such new or modified information collection requirements will be submitted to the Office of Management and Budget (OMB) for review under Section 3507(d) of the PRA. OMB, the general public, and other Federal agencies will be invited to comment on the new or modified information collection requirements contained in this proceeding. In addition, we note that pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), we previously sought specific comment on how the Commission might further reduce the information collection burden for small business concerns with fewer than 25 employees. In this document, we describe several steps we have taken to minimize the information collection burdens on small entities.

106. Accordingly, it is ordered that pursuant to sections 1-4, 201, 202, 224, and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 151-54, 201, 202, 224, and 303(r), the Fourth Report and Order and Declaratory Ruling hereby is adopted and part 1 of the Commission's Rules, 47 CFR part 1, is amended as set forth in Appendix A of the Fourth Report and Order.

107. It is further ordered that the Fourth Report and Order shall become effective 30 days after publication in the Federal Register , except that the amendments to § 1.1411(c)(4) and new § 1.1415, 47 CFR 1.1411(c)(4), 1.1415, which may contain new or modified information collection requirements, will not become effective until the Office of Management and Budget completes review of any information collection requirements that the Wireline Competition Bureau determines is required under the Paperwork Reduction Act. The Commission directs the Wireline Competition Bureau to announce the effective date for § 1.1411(c)(4) and new § 1.1415 by subsequent Public Notice.

108. It is further ordered that, pursuant to 47 CFR 1.4(b)(1), the period for filing petitions for reconsideration or petitions for judicial review of the Fourth Report and Order will commence on the date that a summary of the Fourth Report and Order is published in the Federal Register , and the period for filing petitions for reconsideration or petitions for judicial review of the Declaratory Ruling will commence upon release of the Declaratory Ruling.

109. It is further ordered that the Commission's Office of the Secretary, shall send a copy of the Fourth Report and Order and Declaratory Ruling, including the Final Regulatory Flexibility Analysis and Initial Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.

110. It is further ordered that the Office of the Managing Director, Performance Evaluation and Records Management, shall send a copy of the Fourth 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).

The Federal Communications Commission amends part 1 of title 47 of the Code of Federal Regulations as follows:

GSA published a proposed rule in the Federal Register at 88 FR 15941 on March 15, 2023 to amend the GSAR to address when the GSAR clauses apply to Federal Supply Schedule contracts established by a delegated agency.

The GSA Schedule, also known as Federal Supply Schedule (FSS), and/or Multiple Award Schedule (MAS), is a long-term governmentwide contract with commercial companies that provide access to millions of commercial products and services at fair and reasonable prices to the Federal Government. GSA may delegate certain responsibilities to other agencies ( i.e. , GSA has delegated authority to the Department of Veterans Affairs (VA) to procure medical supplies under the VA Federal Supply Schedules Program).

Such delegation provides the authorized agency autonomy over their resulting contract. The contract is published on the FSS website, and often looks like every other available FSS contract apart from the naming convention. Contracts administered solely by GSA have a “GS” naming convention.

This change will streamline the prescription language. Prescription language is the language that instructs when a clause is to be applied, when establishing a Schedule contract.

GSA provided the public a 60-day comment period (March 15, 2023, to May 15, 2023). GSA did not receive any comments from the public.

GSA did not make any significant changes, or changes of any kind, since publication of the proposed rule.

This final rule will ensure GSA's contracting officers are using the clauses correctly, clarifies how GSA's delegation to other Government agencies work, provides instruction on how to document the contract file, and the procedures for requesting a deviation. This change will have no impact on the approximately 13,000 FSS contractors already using the existing clauses. The changes do not alter the manner in which the contractors conduct business.

Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. E.O. 14094 ( Modernizing Regulatory Review ) supplements and reaffirms the principles, structures, and definitions governing contemporary regulatory review established in E.O. 12866 and E.O. 13563. The Office of Information and Regulatory Affairs (OIRA) in the Office of Management and Budget (OMB) has determined that this is not a significant regulatory action and, therefore, was not subject to review under Section 6(b) of Executive Order 12866, Regulatory Planning and Review, dated September 30, 1993.

The Congressional Review Act, 5 U.S.C. 801 et seq., as amended by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a “major rule” may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. The General Services Administration 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. A major rule cannot take effect until 60 days after it is published in the Federal Register . OIRA has determined this rule is not to be a “major rule” under 5 U.S.C. 804.

GSA does not expect this rule to have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., because the described changes clarify the language and only slightly modify the current text. The meaning behind the changed text remains the same, and therefore any burden would have been identified previously. However, a Final Regulatory Flexibility Analysis (FRFA) has been prepared. The FRFA has been prepared consistent with the criteria of 5 U.S.C. 604 and is summarized as follows:

The Regulatory Secretariat Division will be submitting a copy of the FRFA to the Chief Counsel for Advocacy of the Small Business Administration. A copy of the FRFA may be obtained from the Regulatory Secretariat Division.

The rule does not contain any information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

Therefore, GSA amends 48 CFR part 538 as set forth below:

The Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (2015 Act), enacted as part of the Bipartisan Budget Act of 2015, Public Law 114-74, 701, 129 Stat. 584, 599-601, requires agencies to adjust their civil penalties for inflation annually, beginning on July 1, 2016, and no later than January 15 of every year thereafter. In accordance with the 2015 Act, annual inflation adjustments are to be based on the percent change between the Consumer Price Index for all Urban Consumers (CPI-U) for October of the previous year and the October CPI-U of the year before that. Penalty level adjustments should be rounded to the nearest dollar.

The statutory definition of civil monetary penalty covers various civil penalty provisions under the Rail (Part A); Motor Carriers, Water Carriers, Brokers, and Freight Forwarders (Part B); and Pipeline Carriers (Part C) provisions of the Interstate Commerce Act, as amended. The Board's civil (and criminal) penalty authority related to rail transportation appears at 49 U.S.C. 11901-11908. The Board's penalty authority related to motor carriers, water carriers, brokers, and freight forwarders appears at 49 U.S.C. 14901-14916. The Board's penalty authority related to pipeline carriers appears at 49 U.S.C. 16101-16106. 1 The Board has regulations at 49 CFR pt. 1022 that codify the method set forth in the 2015 Act for annually adjusting for inflation the civil monetary penalties within the Board's jurisdiction.

As set forth in this final rule, the Board is amending 49 CFR part 1022 to make an annual inflation adjustment to the civil monetary penalties in conformance with the requirements of the 2015 Act. The adjusted penalties set forth in the rule will apply only to violations that occur after the effective date of this regulation.

In accordance with the 2015 Act, the annual adjustment adopted here is calculated by multiplying each current penalty by the cost-of-living adjustment factor of 1.03241, which reflects the percentage change between the October 2023 CPI-U (307.671) and the October 2022 CPI-U (298.012). The table at the end of this decision shows the statutory citation for each civil penalty, a description of the provision, the adjusted statutory civil penalty level for 2023, and the adjusted statutory civil penalty level for 2024.

The final rule set forth at the end of this decision is being issued without notice and comment pursuant to the rulemaking provision of the Administrative Procedure Act (APA), 5 U.S.C. 553(b)(B), which does not require that process “when the agency for good cause finds” that public notice and comment are “unnecessary.” Here, Congress has mandated that the agency make an annual inflation adjustment to its civil monetary penalties. The Board has no discretion to set alternative levels of adjusted civil monetary penalties, because the amount of the inflation adjustment must be calculated in accordance with the statutory formula. Given the absence of discretion, the Board has determined that there is good cause to promulgate this rule without soliciting public comment and to make this regulation effective immediately upon publication.

The Regulatory Flexibility Act (RFA), as amended by the Small Business Regulatory Enforcement Fairness Act of 1996, 5 U.S.C. 601-612, generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements, unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Because the Board has determined that notice and comment are not required under the APA for this rulemaking, the requirements of the RFA do not apply.

Pursuant to the Congressional Review Act, 5 U.S.C. 801-808, the Office of Information and Regulatory Affairs has designated this rule as a non-major rule, as defined by 5 U.S.C. 804(2).

This final rule does not contain a new or amended information collection requirement subject to the Paperwork Reduction Act of 1995, 44 U.S.C. 3501-3521.

It is ordered:

1. The Board amends its rules as set forth in this decision. Notice of the final rule will be published in the Federal Register .

2. This decision is effective on its date of publication in the Federal Register .

Decided: January 9, 2024.

By the Board, Board Members Fuchs, Hedlund, Oberman, Primus, and Schultz. Board Member Primus concurred with a separate expression.

When the Board adjusted its civil monetary penalties last year, I wrote separately to express concern about the adequacy of the penalties afforded by statute. Civ. Monetary Penalties—2023 Adjustment, EP 716 (Sub-No. 8) (STB served Jan. 13, 2023), slip op. at 3-4 (Member Primus concurring). That concern remains today. The Board's decision, consistent with the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, makes minor adjustments to its civil penalties—for example, increasing the penalty in 49 U.S.C. 11901(a) from $9,413 to $9,718. For the reasons I stated last year, those penalties are unlikely to provide the deterrent effect intended by Congress, and Congress should address this inadequacy.

For the reasons set forth in the preamble, part 1022 of title 49, chapter X, of the Code of Federal Regulations is amended as follows:

NMFS manages the groundfish fishery in the Bering Sea and Aleutian Islands (BSAI) according to the Fishery Management Plan for Groundfish of the Bering Sea and Aleutian Islands Management Area (FMP) prepared by the North Pacific Fishery Management Council under authority of the Magnuson-Stevens Fishery Conservation and Management Act. Regulations governing fishing by U.S. vessels in accordance with the FMP appear at subpart H of 50 CFR part 600 and 50 CFR part 679.

The A season apportionment of the 2024 Pacific cod total allowable catch (TAC) specified for vessels using jig gear in the BSAI is 1,169 metric tons (mt) as established by the final 2023 and 2024 harvest specifications for groundfish in the BSAI (88 FR 14926, March 10, 2023) and inseason adjustment (88 FR 88836, December 26, 2023).

The 2024 Pacific cod TAC allocated to catcher vessels less than 60 feet (18.3 meters (m)) length overall (LOA) using hook-and-line or pot gear in the BSAI is 2,767 mt as established by final 2023 and 2024 harvest specifications for groundfish in the BSAI (88 FR 14926, March 10, 2023) and inseason adjustment (88 FR 88836, December 26, 2023).

The Administrator, Alaska Region, NMFS, (Regional Administrator) has determined that jig vessels will not be able to harvest 1,100 mt of the A season apportionment of the 2024 Pacific cod TAC allocated to those vessels under § 679.20(a)(7)(ii)(A)(1). Therefore, in accordance with § 679.20(a)(7)(iv)(C), NMFS apportions 1,100 mt of Pacific cod from the A season jig gear apportionment to the annual amount specified for catcher vessels less than 60 feet (18.3 m) LOA using hook-and-line or pot gear.

The harvest specifications for 2024 Pacific cod included in final 2023 and 2024 harvest specifications for groundfish in the BSAI (88 FR 14926, March 10, 2023) and inseason adjustment (88 FR 88836, December 26, 2023) are revised as follows: 69 mt to the A season apportionment and 848 mt to the annual amount for vessels using jig gear, and 3,867 mt to catcher vessels less than 60 feet (18.3 m) LOA using hook-and-line or pot gear.

NMFS issues this action pursuant to section 305(d) of the Magnuson-Stevens Act. This action is required by 50 CFR part 679, which was issued pursuant to section 304(b), and is exempt from review under Executive Order 12866.

Pursuant to 5 U.S.C. 553(b)(B), there is good cause to waive prior notice and an opportunity for public comment on this action, as notice and comment would be impracticable and contrary to the public interest, as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay the reallocation of Pacific cod specified from jig vessels to catcher vessels less than 60 feet (18.3 m) LOA using hook-and-line or pot gear. NMFS was unable to publish a notice providing time for public comment because the most recent, relevant data only became available as of January 8, 2024.

The Assistant Administrator for Fisheries, NOAA also finds good cause to waive the 30-day delay in the effective date of this action under 5 U.S.C. 553(d)(3). This finding is based upon the reasons provided above for waiver of prior notice and opportunity for public comment.