In the final rule published March 12, 2024, at 89 FR 17693, DHS amended 6 CFR chapter 1 by revising part 126. However, the words of issuance instructing the amendment erroneously stated the Department is adding part 126. Part 126 already exists, and therefore the instruction should have been that the Department is revising it.

In FR Rule Doc. No. 2024-05131 appearing on page 17693 in the Federal Register of Tuesday, March 12, 2024, the following correction is made:

1. On page 17702, in the third column under the heading “The Amendments,” the words of issuance “For the reasons set forth in the preamble, the Department of Homeland Security adds part 126 to Title 6, Code of Federal Regulations, to read as follows:” is corrected to read “For the reasons set forth in the preamble, the Department of Homeland Security revises part 126 to Title 6, Code of Federal Regulations, to read as follows:”.

The NRC is issuing a revision in the NRC's “Regulatory Guide” series. This series was developed to describe methods that are acceptable to the NRC staff for implementing specific parts of the agency's regulations, to explain techniques that the staff uses in evaluating specific issues or postulated events, and to describe information that the staff needs in its review of applications for permits and licenses.

The proposed Revision 3 to RG 1.128 was issued with a temporary identification of Draft Regulatory Guide, (DG)-1421 (ADAMS Accession No. ML23277A276.) This revision of this guide (Revision 3) describes an approach that is acceptable to the NRC staff to meet the regulatory requirements for installation, inspection, and testing for Class 1E power, instrumentation, and control equipment at production and utilization facilities. RG 1.128, Revision 3 endorses, with clarifications, Institute of Electrical and Electronics Engineers (IEEE) Standard 484-2019, “IEEE Recommended Practice for Installation Design and Installation of Vented Lead-Acid Batteries for Stationary Applications.”

The NRC published a notice of the availability of DG-1421 in the Federal Register on January 8, 2024 (89 FR 895) for a 30-day public comment period. The public comment period closed on February 7, 2024. Public comments on DG-1421 and the staff responses to the public comments are available in ADAMS under Accession No. ML24052A078.

As noted in the Federal Register on December 9, 2022 (87 FR 75671), this document is being published in the “Rules” section of the Federal Register to comply with publication requirements under chapter 1 of title 1 of the Code of Federal Regulations (CFR).

This RG 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.

Issuance of RG 1.128, Revision 3, does not constitute backfitting as that term is defined in 10 CFR 50.109, “Backfitting,” and as described in NRC Management Directive (MD) 8.4, “Management of Backfitting, Forward Fitting, Issue Finality, and Information Requests;” does not affect the issue finality of an approval issued under 10 CFR part 52, “Licenses, Certifications, and Approvals for Nuclear Power Plants;” and does not constitute forward fitting as that term is defined and described in MD 8.4 because, as explained in RG 1.128, Revision 3, licensees would not be required to comply with the positions set forth in the RG.

A member of the public may, at any time, submit suggestions to the NRC for improvement of existing RGs or for the development of new RGs. Suggestions can be submitted on the NRC's public website at https://www.nrc.gov/reading-rm/doc-collections/reg-guides/contactus.html. Suggestions will be considered in future updates and enhancements to the “Regulatory Guide” series.

The NRC is issuing a revision in the NRC's “Regulatory Guide” series. This series was developed to describe methods that are acceptable to the NRC staff for implementing specific parts of the agency's regulations, to explain techniques that the staff uses in evaluating specific issues or postulated events, and to describe information that the staff needs in its review of applications for permits and licenses.

The proposed Revision 1 to RG 1.30 was issued with a temporary identification of Draft Regulatory Guide (DG)-1419 (ADAMS Accession No. ML23222A182). This revision of this guide (Revision 1) describes an approach that is acceptable to the NRC staff to meet the regulatory requirements for installation, inspection, and testing for Class 1E power, instrumentation, and control equipment at production and utilization facilities. RG 1.30, Revision 1 endorses, with a clarification, Institute of Electrical and Electronics Engineers (IEEE) Standard 336-2020, “IEEE Recommended Practice for Installation, Inspection, and Testing for Class 1E Power, Instrumentation, and Control Equipment at Nuclear Facilities.”

The NRC published a notice of the availability of DG-1419 in the Federal Register on December 20, 2023 (88 FR 87967) for a 30-day public comment period. The public comment period closed on January 19, 2024. Public comments on DG-1419 and the staff responses to the public comments are available in ADAMS under Accession No. ML24040A165.

As noted in the Federal Register on December 9, 2022 (87 FR 75671), this document is being published in the “Rules” section of the Federal Register to comply with publication requirements under chapter I of title 1 of the Code of Federal Regulations (CFR).

This RG 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.

Issuance of RG 1.30, Revision 1, does not constitute backfitting as that term is defined in 10 CFR 50.109, “Backfitting,” and as described in NRC Management Directive (MD) 8.4, “Management of Backfitting, Forward Fitting, Issue Finality, and Information Requests”; affect the issue finality of an approval issued under 10 CFR part 52, “Licenses, Certifications, and Approvals for Nuclear Power Plants”; or constitute forward fitting as that term is defined and described in MD 8.4 because, as explained in RG 1.30, Revision 1, licensees are not required to comply with the positions set forth in the RG.

A member of the public may, at any time, submit suggestions to the NRC for improvement of existing RGs or for the development of new RGs. Suggestions can be submitted on the NRC's public website at https://www.nrc.gov/reading-rm/doc-collections/reg-guides/contactus.html. Suggestions will be considered in future updates and enhancements to the “Regulatory Guide” series.

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

The FAA published a notice of proposed rulemaking for Docket No. FAA-2023-2247 in the Federal Register (88 FR 78265; November 15, 2023), proposing to amend VOR Federal Airway V-132 and revoke VOR Federal Airways V-131, V-307, and V-350 due to the planned decommissioning of the VOR portion of the Chanute, KS, VOR/DME NAVAID. Interested parties were invited to participate in this rulemaking effort by submitting written comments on the proposal. No comments were received.

VOR Federal airways are published in paragraph 6010(a) of FAA Order JO 7400.11, Airspace Designations and Reporting Points, which is incorporated by reference in 14 CFR 71.1 on an annual basis. This document amends the current version of that order, FAA Order JO 7400.11H, dated August 11, 2023, and effective September 15, 2023. FAA Order JO 7400.11H is publicly available as listed in the ADDRESSES section of this document. These amendments will be published in the next update to FAA Order JO 7400.11.

FAA Order JO 7400.11H lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

This action amends 14 CFR part 71 by amending VOR Federal Airway V-132 and revoking VOR Federal Airways V-131, V-307, and V-350 due to the planned decommissioning of the VOR portion of the Chanute, KS, VOR/DME NAVAID. The airway actions are described below.

V-131: Prior to this final rule, V-131 extended between the Okmulgee, OK, VOR/DME and the Topeka, KS, VOR/Tactical Air Navigation (VORTAC). The airway segment between the Tulsa, OK, VORTAC and the Topeka VORTAC is removed due to the planned decommissioning of the Chanute VOR. Additionally, the airway segment between the Okmulgee VOR/DME and the Tulsa VORTAC is also removed since that airway segment overlaps V-161, which will remain charted and provide navigational guidance between the two NAVAIDs. As a result, the airway is removed in its entirety.

V-132: Prior to this final rule, V-132 extended between the Medicine Bow, WY, VOR/DME and the intersection of the Forney, MO, VOR 086° and Vichy, MO, VOR/DME 156° radials (LENOX Fix), excluding that portion of the airway within restricted areas R-4501A, R-4501B, R-4501C, and R-4501D during their time of activation. The airway segment between the Hutchinson, KS, VOR/DME and the Springfield, MO, VORTAC is removed. Additionally, that portion of the airway within restricted areas R-4501E, R-4501F, and R-4501H is also excluded during the restricted areas times of activation since those restricted areas also fall within 4 nautical miles of the airway. As amended, the airway is changed to now extend between the Medicine Bow VOR/DME and the Hutchinson VOR/DME, and between the Springfield VORTAC and the intersection of the Forney VOR 086° and Vichy VOR/DME 156° radials (LENOX Fix), excluding the portion within all 7 restricted areas of the R-4501 restricted area complex.

V-307: Prior to this final rule, V-307 extended between the Chanute, KS, VOR/DME and the Emporia, KS, VORTAC. The airway is removed in its entirety.

V-350: Prior to this final rule, V-350 extended between the Wichita, KS, VORTAC and the Chanute, KS, VOR/DME. The airway is removed in its entirety.

The NAVAID radials listed in the V-132 description in the regulatory text of this final rule are unchanged and stated in degrees True north.

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

The FAA has determined that this action of amending VOR Federal Airway V-132 and revoking VOR Federal Airways V-131, V-307, and V-350, due to the planned decommissioning of the VOR portion of the Chanute, KS, VOR/DME NAVAID, qualifies for categorical exclusion under the National Environmental Policy Act (42 U.S.C. 4321 et seq. ) and its implementing regulations at 40 CFR part 1500, and in accordance with FAA Order 1050.1F, Environmental Impacts: Policies and Procedures, paragraph 5-6.5a, which categorically excludes from further environmental impact review rulemaking actions that designate or modify classes of airspace areas, airways, routes, and reporting points (see 14 CFR part 71, Designation of Class A, B, C, D, and E Airspace Areas; Air Traffic Service Routes; and Reporting Points); and paragraph 5-6.5k, which categorically excludes from further environmental impact review publication of existing air traffic control procedures that do not essentially change existing tracks, create new tracks, change altitude, or change concentration of aircraft on these tracks. As such, this action is not expected to result in any potentially significant environmental impacts. In accordance with FAA Order 1050.1F, paragraph 5-2 regarding Extraordinary Circumstances, the FAA has reviewed this action for factors and circumstances in which a normally categorically excluded action may have a significant environmental impact requiring further analysis. The FAA has determined that no extraordinary circumstances exist that warrant preparation of an environmental assessment or environmental impact study.

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

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

The FAA published a NPRM for Docket No. FAA 2023-2040 in the Federal Register (88 FR 73268; October 25, 2023), proposing to establish three RNAV routes and amend six RNAV routes in the eastern United States. Interested parties were invited to participate in this rulemaking effort by submitting written comments on the proposal to the FAA. No comments were received.

Subsequent to publication of the NPRM, the FAA identified that two route points had been inadvertently omitted from the legal description of RNAV Routes T-287 and T-398. These route points are required to be added to the part 71 description of each route as it represents a turn point of one degree or more. The HAMRR, MD, waypoint (WP) is added between the TOMYD, PA, WP and the DANII, MD, WP in the description of T-287; and the MANGE, VA, Fix is added between the BOUSY, VA, WP and the THHMP, VA, WP in the description of T-398. The addition of the HAMRR WP and the MANGE Fix to their respective routes does not substantively alter the route of T-287 and T-398.

The FAA identified the Bangor, ME (BGR), Very High Frequency Omnidirectional Range/Tactical Air Navigation (VORTAC) was inadvertently omitted from the NPRM's part 71 description of RNAV Route T-295. Prior to this action, the Bangor VORTAC was in the description of RNAV Route T-295 and remains on the route between the BRNNS, ME, Fix and the LAUDS, ME, WP.

In the part 71 description of RNAV Route T-206 the NUROE, NC, WP was removed as intended. In the description of the proposed changes the removal of the NUROE WP was not addressed. The NUROE WP remains charted on T-206 but is removed from the part 71 description as the route segments that it makes up do not contain a turn of one degree or more. In the part 71 description of RNAV Route T-287 the BOUSY, VA, WP was inadvertently listed as the BOUSY, NC, WP. The BOUSY WP is located in the state of Virginia in the National Airspace System Resource (NASR) database and charted as such.

Finally, in the NPRM the FAA incorrectly listed the RUBKI, MI; TOTHH, NY; HAVNS, OA; VYSOR, MD; ACUTE, NC; SVILL, VA; and POORK, VA route points as Fixes. The route points are identified as WPs in the NASR database and charted as WPs accordingly. Additionally, the FAA incorrectly listed YODAA, NY as a WP. YODAA, NY is identified as a Fix in the NASR database and charted as a Fix accordingly. This final rule corrects these errors.

United States Area Navigation routes (Q-routes) are published in paragraph 2006 and United States Area Navigation (T-routes) are published in paragraph 6011 of FAA Order JO 7400.11, Airspace Designations and Reporting Points, which is incorporated by reference in 14 CFR 71.1 on an annual basis. This document amends the current version of that order, FAA Order JO 7400.11H, dated August 11, 2023, and effective September 15, 2023. FAA Order JO 7400.11H is publicly available as listed in the ADDRESSES section of this document. These amendments will be published in the next update to FAA Order JO 7400.11.

FAA Order JO 7400.11H lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

This action amends 14 CFR part 71 by establishing RNAV Routes T-480, T-482, and T-488, and amending RNAV Routes Q-140, T-206, T-258, T-287, T-295, and T-398 in the eastern United States. This action supports NextGen which provides a modern RNAV route structure to improve the efficiency of the NAS. The amendments are described below.

Q-140: Prior to this final rule, Q-140 extended between the WOBED, WA, WP and the YODAA, NY, Fix. The route is amended by moving the RUBKI, Canada, WP 22 feet west of its current position to align with the United States/Canadian border replacing the CFCTJ, MI, Computer Navigation Fix (CNF). Additionally, the RAGIX, NY, Fix is being moved 0.5 nautical miles (NM) east to align with the United States/Canadian border replacing the CFDHX, NY, CNF. The RODYY, NY, WP is being replaced with the TOTHH, NY, WP due to similar sounding route point names. Finally, the FAA is removing fixes from the route's legal description for segments that are in Canada, and segments that contain turns of less than one degree. The following are the route points that are removed: GETNG, WA, WP; CORDU, ID, Fix; PETIY, MT, WP; CHOTE, MT, Fix; CESNA, WI, WP; WISCN, WI, WP; PEPLA, Canada, WP; SIKBO, Canada, WP; MEDAV, Canada, WP; HANKK, NY, Fix; BEEPS, NY, Fix; EXTOL, NY, Fix; MEMMS, NY, Fix; and KODEY, NY, Fix. As amended, the route continues to extend between the WOBED WP and the YODAA Fix.

T-206: Prior to this final rule, T-206 extended between the ENADE, NC, WP and the ZADEL, NC, WP. The route is extended to the east between the ZADEL WP and the SNOWS, NC, Fix. As amended, the route is changed to now extend between the ENADE, NC, WP and the SNOWS, NC, Fix.

T-258: Prior to this final rule, T-258 extended between the MINIM, AL, Fix and the GMINI, NC, WP. The route is extended to the northeast between the GMINI WP and the BOUSY, VA, WP. Additionally, the FAA removed fixes from the route's legal description for segments that contain turns of less than one degree. The following are the route points that are removed: CAYAP, AL, Fix; ZIVMU, AL, Fix; DAYVS, AL, WP; HEENA, AL, Fix; KYLEE, AL, Fix; CAMPP, AL, Fix; and LANGA, GA, Fix. As amended, the route is changed to now extend between the MINIM Fix and the BOUSY WP.

T-287: Prior to this final rule, T-287 extended between the DENNN, VA, WP and the TOMYD, MD, WP. The route is extended to the southwest between the GMINI, NC, WP and the DENNN WP; and to the northeast between the TOMYD WP and the Kennebunk, ME (ENE), VOR/Distance Measuring Equipment (VOR/DME). The FAA moved the TOMYD, MD, WP 2.8 NM north of its current location. Moving the TOMYD WP allows alignment with future proposed RNAV routes, and results in the WP being in the state of Pennsylvania. The amended route segment of T-287 overlays a portion of VOR Federal Airway V-44 between the PALEO, MD, WP and the WNSTN, NJ, WP; a portion of VOR Federal Airway V-139 between MANTA, NJ, Fix and the Kennebunk VOR/DME; and a portion of VOR Federal Airway V-454 between the SNOWS, NC, Fix and the Lawrenceville, VA (LVL), VORTAC. Additionally, the FAA removed fixes from the route's legal description for segments that contain turns of less than one degree. The following are the waypoints that are removed: DENNN, VA, WP; CAARY, VA, WP; and WILMY, VA, WP. As amended, the route is changed to now extend between the GMINI WP and the Kennebunk VOR/DME.

T-295: Prior to this final rule, T-295 extended between the POORK, VA, WP and the Presque Isle, ME (PQI), VOR/DME. The FAA extended T-295 to the southwest between the DUFFI, NC, Fix and the POORK WP; added the DOGWD, VA, Fix and the RIPKN, MD, WP to the route; and replaced the Wilkes Barre, PA (LVZ), VOR/DME with the WLKES, PA, Fix. Additionally, the FAA removed the Chester, MA (CTR), VOR/DME from the route's legal description as those segments contain turns of less than one degree. As amended, the route is changed to now extend between the DUFFI Fix and the Presque Isle VOR/DME.

T-398: Prior to this final rule, T-398 extended between the RRORY, TX, WP and the GMINI, NC, WP. The FAA extended T-398 to the northeast between the GMINI WP and the TAPPA, VA, Fix. The amended route segment of T-398 overlays a portion of VOR Federal Airway V-155 from the Sandhills, NC (SDZ), VORTAC to the MANGE, VA, Fix. As amended, the route is changed to now extend between the RRORY WP and the TAPPA Fix.

T-480: T-480 is a new route that extends between the Greensboro, NC (GSO), VORTAC and the ZOLMN, NC, Fix. T-480 overlays a portion of VOR Federal Airway V-266 between the Greensboro VORTAC and the South Boston, MA (SBV), VORTAC; from the MAZON, VA, Fix to the Wright Brothers, NC (RBX), VOR/DME; and a portion of Colored Federal Airway Green 13 (G-13) from the MANTEO, NC (MQI), Nondirectional Radio Beacon (NDB) to the ZOLMN Fix.

T-482 : T-482 is a new route that extends between the MEYER, NC, Fix and the COUPN, VA, WP. T-482 overlays a portion of VOR Federal Airway V-615 between the MEYER Fix and the DUFFI, NC, Fix.

T-488: T-488 is a new route that extends between the Tar River, NC (TYI), VORTAC and the RTBRO, NC, Fix. T-488 overlays a portion of VOR Federal Airway V-189 from the Tar River VORTAC and the Wright Brothers, NC (RBX), VOR/DME.

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

The FAA has determined that this action of establishing RNAV Routes T-480, T-482, and T-488, and amending RNAV Routes Q-140, T-206, T-258, T-287, T-295, and T-398 in the eastern United States in support of FAA NextGen, qualifies for categorical exclusion under the National Environmental Policy Act (42 U.S.C. 4321 et seq. ) and its implementing regulations at 40 CFR part 1500, and in accordance with FAA Order 1050.1F, “Environmental Impacts: Policies and Procedures,” paragraph 5-6.5a, which categorically excludes from further environmental impact review rulemaking actions that designate or modify classes of airspace areas, airways, routes, and reporting points (see 14 CFR part 71, Designation of Class A, B, C, D, and E Airspace Areas; Air Traffic Service Routes; and Reporting Points); and paragraph 5-6.5b, which categorically excludes from further environmental impact review “Actions regarding establishment of jet routes and Federal airways (see 14 CFR 71.15, Designation of jet routes and VOR Federal airways ) . . .”. As such, this airspace action is not expected to cause any potentially significant environmental impacts. In accordance with FAA Order 1050.1F, paragraph 5-2 regarding Extraordinary Circumstances, the FAA has reviewed this action for factors and circumstances in which a normally categorically excluded action may have a significant environmental impact requiring further analysis. Accordingly, the FAA has determined that no extraordinary circumstances exist that warrant preparation of an environmental assessment or environmental impact study.

This amendment to part 95 of the Federal Aviation Regulations (14 CFR part 95) amends, suspends, or revokes IFR altitudes governing the operation of all aircraft in flight over a specified route or any portion of that route, as well as the changeover points (COPs) for Federal airways, jet routes, or direct routes as prescribed in part 95.

The specified IFR altitudes, when used in conjunction with the prescribed changeover points for those routes, ensure navigation aid coverage that is adequate for safe flight operations and free of frequency interference. The reasons and circumstances that create the need for this amendment involve matters of flight safety and operational efficiency in the National Airspace System, are related to published aeronautical charts that are essential to the user, and provide for the safe and efficient use of the navigable airspace. In addition, those various reasons or circumstances require making this amendment effective before the next scheduled charting and publication date of the flight information to assure its timely availability to the user. The effective date of this amendment reflects those considerations. In view of the close and immediate relationship between these regulatory changes and safety in air commerce, I find that notice and public procedure before adopting this amendment are impracticable and contrary to the public interest and that good cause exists for making the amendment effective in less than 30 days.

The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore—(1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. For the same reason, the FAA certifies that this amendment will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

Accordingly, pursuant to the authority delegated to me by the Administrator, part 95 of the Federal Aviation Regulations (14 CFR part 95) is amended as follows effective at 0901 UTC, May 16, 2024.

This rule amends 14 CFR part 97 by establishing, amending, suspending, or removes SIAPS, Takeoff Minimums and/or ODPS. The complete regulatory description of each SIAP and its associated Takeoff Minimums or ODP for an identified airport is listed on FAA form documents which are incorporated by reference in this amendment under 5 U.S.C. 552(a), 1 CFR part 51, and 14 CFR 97.20. The applicable FAA Forms are 8260-3, 8260-4, 8260-5, 8260-15A, 8260-15B, when required by an entry on 8260-15A, and 8260-15C.

The large number of SIAPs, Takeoff Minimums and ODPs, their complex nature, and the need for a special format make publication in the Federal Register expensive and impractical. Further, pilots do not use the regulatory text of the SIAPs, Takeoff Minimums or ODPs, but instead refer to their graphic depiction on charts printed by publishers or aeronautical materials. Thus, the advantages of incorporation by reference are realized and publication of the complete description of each SIAP, Takeoff Minimums and ODP listed on FAA form documents is unnecessary. This amendment provides the affected CFR sections and specifies the types of SIAPS, Takeoff Minimums and ODPs with their applicable effective dates. This amendment also identifies the airport and its location, the procedure, and the amendment number.

The material incorporated by reference is publicly available as listed in the ADDRESSES section.

The material incorporated by reference describes SIAPS, Takeoff Minimums and/or ODPs as identified in the amendatory language for part 97 of this final rule.

This amendment to 14 CFR part 97 is effective upon publication of each separate SIAP, Takeoff Minimums and ODP as amended in the transmittal. Some SIAP and Takeoff Minimums and textual ODP amendments may have been issued previously by the FAA in a Flight Data Center (FDC) Notice to Air Missions (NOTAM) as an emergency action of immediate flights safety relating directly to published aeronautical charts.

The circumstances that created the need for some SIAP and Takeoff Minimums and ODP amendments may require making them effective in less than 30 days. For the remaining SIAPs and Takeoff Minimums and ODPs, an effective date at least 30 days after publication is provided.

Further, the SIAPs and Takeoff Minimums and ODPs contained in this amendment are based on the criteria contained in the U.S. Standard for Terminal Instrument Procedures (TERPS). In developing these SIAPs and Takeoff Minimums and ODPs, the TERPS criteria were applied to the conditions existing or anticipated at the affected airports. Because of the close and immediate relationship between these SIAPs, Takeoff Minimums and ODPs, and safety in air commerce, I find that notice and public procedure under 5 U.S.C. 553(b) are impracticable and contrary to the public interest and, where applicable, under 5 U.S.C. 553(d), good cause exists for making some SIAPs effective in less than 30 days.

The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore—(1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. For the same reason, the FAA certifies that this amendment will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

Accordingly, pursuant to the authority delegated to me, 14 CFR part 97 is amended by establishing, amending, suspending, or removing Standard Instrument Approach Procedures and/or Takeoff Minimums and Obstacle Departure Procedures effective at 0901 UTC on the dates specified, as follows:

This rule amends 14 CFR part 97 by amending the referenced SIAPs. The complete regulatory description of each SIAP is listed on the appropriate FAA Form 8260, as modified by the National Flight Data Center (NFDC)/Permanent Notice to Air Missions (P-NOTAM), and is incorporated by reference under 5 U.S.C. 552(a), 1 CFR part 51, and 14 CFR 97.20. The large number of SIAPs, their complex nature, and the need for a special format make their verbatim publication in the Federal Register expensive and impractical. Further, pilots do not use the regulatory text of the SIAPs, but refer to their graphic depiction on charts printed by publishers of aeronautical materials. Thus, the advantages of incorporation by reference are realized and publication of the complete description of each SIAP contained on FAA form documents is unnecessary. This amendment provides the affected CFR sections, and specifies the SIAPs and Takeoff Minimums and ODPs with their applicable effective dates. This amendment also identifies the airport and its location, the procedure and the amendment number.

The material incorporated by reference is publicly available as listed in the ADDRESSES section.

The material incorporated by reference describes SIAPs, Takeoff Minimums and ODPs as identified in the amendatory language for part 97 of this final rule.

This amendment to 14 CFR part 97 is effective upon publication of each separate SIAP and Takeoff Minimums and ODP as amended in the transmittal. For safety and timeliness of change considerations, this amendment incorporates only specific changes contained for each SIAP and Takeoff Minimums and ODP as modified by FDC permanent NOTAMs.

The SIAPs and Takeoff Minimums and ODPs, as modified by FDC permanent NOTAM, and contained in this amendment are based on criteria contained in the U.S. Standard for Terminal Instrument Procedures (TERPS). In developing these changes to SIAPs and Takeoff Minimums and ODPs, the TERPS criteria were applied only to specific conditions existing at the affected airports. All SIAP amendments in this rule have been previously issued by the FAA in a FDC NOTAM as an emergency action of immediate flight safety relating directly to published aeronautical charts.

The circumstances that created the need for these SIAP and Takeoff Minimums and ODP amendments require making them effective in less than 30 days.

Because of the close and immediate relationship between these SIAPs, Takeoff Minimums and ODPs, and safety in air commerce, I find that notice and public procedure under 5 U.S.C. 553(b) are impracticable and contrary to the public interest and, where applicable, under 5 U.S.C. 553(d), good cause exists for making these SIAPs effective in less than 30 days.

The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore—(1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. For the same reason, the FAA certifies that this amendment will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

Accordingly, pursuant to the authority delegated to me, 14 CFR part 97 is amended by amending Standard Instrument Approach Procedures and Takeoff Minimums and ODPs, effective at 0901 UTC on the dates specified, as follows:

On December 29, 2022, the Treasury Department and the IRS published proposed regulations (REG-100442-22), relating to the treatment of certain entities, including qualified foreign pension funds (“QFPFs”), for purposes of the exemption from taxation afforded to foreign governments under section 892 of the Internal Revenue Code (the “Code”), and the determination of whether a qualified investment entity (“QIE”) is domestically controlled under section 897(h)(4)(B) of the Code, in the Federal Register (87 FR 80097) (the “proposed regulations”). This Treasury decision finalizes the proposed regulations, other than those portions addressing the section 892 exemption (which will be addressed in a separate rulemaking), after taking into account and addressing comments with respect to the proposed regulations. Terms used but not defined in this preamble have the meaning provided in the final regulations.

Comments outside the scope of this rulemaking are generally not addressed but may be considered in connection with future regulations. All written comments received in response to the proposed regulations are available at www.regulations.gov or upon request. A public hearing on the proposed regulations was not held because there were no requests to speak.

The final regulations retain the general approach and structure of the proposed regulations, with certain revisions. This section of the preamble discusses the comments received in response to the proposed regulations and explains the revisions reflected in the final regulations.

The proposed regulations set forth proposed rules for determining whether stock of a QIE is considered “held directly or indirectly” by foreign persons for purposes of defining a domestically controlled QIE under section 897(h)(4)(B). The proposed regulations defined stock in a QIE that is held “indirectly” by taking into account stock of the QIE held through certain entities under a limited “look-through” approach. As described in the preamble to the proposed regulations, this approach gives effect to both the policy of the exception for domestically controlled QIEs in section 897(h)(2) (“DC-QIE exception”), which is limited to QIEs controlled by United States persons, and the requirement in section 897(h)(4)(B) to take into account “indirect” ownership of QIE stock by foreign persons in determining whether a QIE is domestically controlled. 87 FR 80100. The preamble to the proposed regulations also explained that this approach prevents the use of intermediary entities to achieve results contrary to the purposes of the DC-QIE exception. Id. at 80100-01.

The proposed regulations addressed the meaning of direct or indirect ownership by setting forth two categories of potential QIE owners, “look-through persons” and “non-look-through persons.” Proposed § 1.897-1(c)(3)(ii). The proposed regulations generally treated a “domestic C corporation,” defined as any domestic corporation other than a regulated investment company (“RIC”) under section 851, a real estate investment trust (“REIT”) under section 856, or an S corporation under section 1361, as a non-look-through person. Proposed § 1.897-1(c)(3)(v)(A) and (D). However, the proposed regulations treated non-publicly traded domestic C corporations as look-through persons if foreign persons hold a 25 percent or greater interest (by value) in the stock of the corporation (the “domestic corporation look-through rule”). Proposed § 1.897-1(c)(3)(iii)(B) and (c)(3)(v)(B).

Comments generally did not raise concerns with the general look-through approach for determining domestic control of a QIE as it applied to most entities (for example, the treatment of partnerships) but asserted that the domestic corporation look-through rule raises significant issues and should be withdrawn or, if retained, modified to reduce its scope. These comments are addressed in turn in parts I.B. and I.C. of this Summary of Comments and Explanation of Revisions.

Comments generally recommended that the domestic corporation look-through rule be withdrawn on three related grounds: first, that the rule is based on an incorrect reading of the Code, which for this purpose does not permit look-through treatment for domestic C corporations, including because there are no explicit rules providing for constructive ownership (such as those in section 318) under section 897(h)(4)(B); second, that the enactment of other related legislation (or consideration of legislation) demonstrates the rule is inconsistent with congressional intent; and third, that the rule is not necessary because domestic C corporations are subject to U.S. tax. Certain comments also based their recommendation to withdraw the domestic corporation look-through rule on the contention that the rule would negatively impact the U.S. real estate market or otherwise harm the broader U.S. economy.

The Treasury Department and the IRS have determined that it is necessary and appropriate to provide guidance regarding the meaning of “indirect” for determining whether foreign persons are considered to hold less than 50 percent of the value of the stock of a QIE. Every word in a statute must be given effect, and both the proposed and final regulations give effect to the term “indirectly” as used in section 897(h)(4)(B) by adopting a limited look-through approach that includes the domestic corporation look-through rule (as modified in the final regulations). The domestic corporation look-through rule does not apply specific constructive ownership rules like those in section 318. Rather, the guidance gives meaning to indirect ownership under section 897(h)(4)(B) in light of the purpose of the DC-QIE exception. Because the final regulations carry out the statute's mandate to determine indirect ownership rather than constructive ownership, the fact that other parts of section 897 refer to section 318 is irrelevant to the determination of whether a QIE is domestically controlled.

The Treasury Department and the IRS do not agree that the enactment of section 897(h)(4)(E) in section 322(b)(1)(A) of the Protecting Americans from Tax Hikes Act of 2015, Public Law 114-113, div. Q (the “PATH Act”), informs whether the domestic corporation look-through rule should be applied under section 897(h)(4)(B). The rules added in section 897(h)(4)(E) do not prescribe how to interpret the meaning of “indirectly” in section 897(h)(4)(B), nor do they suggest that Congress intended for that provision to set out the only rules for QIE stock held by domestic corporations. Although section 897(h)(4)(E) provides certain rules for looking through QIE stock held by another QIE for purposes of the DC-QIE exception, the absence of other specific rules in the statute on whether domestic C corporations (or any other type of entity) should be looked through does not mean that all other entities should be non-look-through persons.

The Treasury Department and the IRS also disagree with the observation in comments that Congress sanctioned the approach taken by a 2009 private letter ruling (the “2009 PLR”) that treated QIE stock held by a domestic C corporation as owned by a domestic person. 1 The brief citation to that ruling in a report by the Joint Committee on Taxation is neutral and merely restates the holding in the ruling in its description of the then current law. See STAFF OF THE JOINT COMM. ON TAX'N, General Explanation of Tax Legislation Enacted in 2015 (JCS-1-16) 279 (2016) (the “JCT Report”). 2 The JCT Report did not express any view regarding the effect of the 2009 PLR or indicate that Congress endorsed a rule that precludes looking through domestic C corporations in all cases, and it caveated that a private letter ruling may only be relied on by the specific taxpayer to which it was issued and only provided “some indication of administrative practice.” See section 6110(k)(3). This is in contrast to other instances where Congress has explicitly endorsed an approach taken by the IRS. See, for example, H.R. Rep. No. 103-111, at 727-29 (1993) (in enacting section 7701(l), citing Rev. Rul. 84-152, 1984-2 C.B. 381, Rev. Rul. 84-153 1984-2 C.B. 1, and Rev. Rul. 87-89, 1987-2 C.B. 195, in stating the “committee believes that the above-cited IRS rulings appropriately ignore conduit entities and properly recharacterize the transactions described therein.”); S. Rep. No. 95-762, at 8 (1978) (stating that the IRS's “ruling position is correct” in enacting rules consistent with private letter rulings indicating that certain income earned by exempt organizations was not taxable as debt-financed income). Accordingly, the Treasury Department and the IRS have concluded that the JCT Report's reference to the 2009 PLR does not affect the application of the domestic corporation look-through rule.

Likewise, the Treasury Department and the IRS disagree with comments that emphasized the discussion draft released by the Senate Committee on Finance in 2013 (the “2013 Discussion Draft”) and the absence of any related changes to section 897 in the PATH Act. The relevant provision in the 2013 Discussion Draft would have replaced the “held directly or indirectly” language in section 897(h)(4)(B) with specific constructive ownership rules in section 318 (not just those applicable to corporations) to address uncertainty in the determination of indirect ownership. See STAFF OF THE JOINT COMM. ON TAX'N, Technical Explanation of the Senate Committee on Finance Chairman's Staff Discussion Draft of Provisions to Reform International Business Taxation (JCX-15-13) 84 (2013). The 2013 Discussion Draft, however, is not authoritative and has no relevance because it was neither introduced as a bill nor enacted into law. Moreover, Congress did not provide any explanation as to why constructive ownership rules under section 318, as proposed in the 2013 Discussion Draft, were not adopted in the PATH Act nor did it provide any indication as to its interpretation of “indirectly” under the statute, and nothing in the legislative history of the PATH Act or otherwise suggests draft legislation from more than two years earlier during a different Congress informed what was ultimately enacted in the PATH Act. See United States v. Wise, 370 U.S. 405, 411 (1962) (“[S]tatutes are construed by the courts with reference to the circumstances existing at the time of the passage. The interpretation placed upon an existing statute by a subsequent group of Congressmen who are promoting legislation and who are unsuccessful has no persuasive significance here.”).

The Treasury Department and the IRS also disagree with one comment's assertion that the legislative re-enactment doctrine bears on whether to issue the domestic corporation look-through rule. See Helvering v. Reynolds, 313 U.S. 428, 432 (1941) (“[The doctrine of legislative reenactment] does not mean that the prior construction has become so imbedded in the law that only Congress can effect a change.”). 3 Accordingly, the Treasury Department and the IRS have determined that no changes to section 897 made in, or contemplated in connection with, the PATH Act, or any explanation of those changes, preclude, or otherwise affect, adoption of the domestic corporation look-through rule.

Finally, the Treasury Department and the IRS have determined that the domestic corporation look-through rule is the appropriate interpretation of the term “indirectly” in section 897(h)(4)(B) irrespective of whether the domestic C corporation is subject to U.S. tax on income derived from its QIE stock. As expressed through the statutory text, the policy underlying the DC-QIE exception looks to whether control of the QIE is held directly or indirectly by United States or foreign persons, which does not depend on whether United States persons are subject to U.S. tax with respect to income derived from their QIE stock. The determination of domestic control is likewise not affected by whether a foreign shareholder of the domestic C corporation is subject to tax on a disposition of its stock in the corporation under section 897. The purpose of the inquiry is to determine control, and the status of an entity as taxable is not determinative for this purpose.

Accordingly, the Treasury Department and the IRS do not adopt the recommendation to withdraw the domestic corporation look-through rule. However, the final regulations modify the domestic corporation look-through rule as discussed in part I.C of this Summary of Comments and Explanation of Revisions.

Comments recommended that, if the final regulations retain a rule similar to the domestic corporation look-through rule, then the approach should be narrowed from what was proposed so that the final rule more directly addresses potentially inappropriate planning and is easier to comply with and administer.

One comment suggested a variety of potential approaches to narrow the domestic corporation look-through rule. Under one such approach, a non-public domestic C corporation that owns 10 percent or less of a QIE (determined after applying constructive ownership rules under section 318, so as to prevent circumvention of the threshold) would be treated as a non-look-through person. The comment asserted that this approach would be less burdensome on taxpayers and the IRS than the proposed regulations and is premised on the view that a foreign person would not structure an investment through a taxable domestic C corporation so that an unrelated foreign person may apply the DC-QIE exception. The comment described an alternative approach, also intended to reduce compliance and administrative burdens, that would treat a non-public domestic C corporation as a look-through person only if there is at least one foreign person that is a non-look-through person that holds, directly or indirectly (using constructive ownership rules under section 318), 25 percent or more of the value of the corporation's stock. Under this alternative, look-through treatment would also apply only as to those foreign non-look-through persons. As another alternative, the comment suggested a look-through rule that would apply only if a foreign person or a foreign related party holds both a direct interest in the QIE and a substantial indirect interest in the QIE through a non-public domestic C corporation.

A different comment also recommended an approach that focused on commonality of substantial ownership by a foreign person of the QIE and the domestic C corporation. Specifically, a domestic C corporation would be treated as a foreign person for purposes of section 897(h)(4)(B) (but not for section 897(h)(4)(C)), if more than 50 percent of its stock is owned, by voting power or value, by foreign persons that also hold stock of the QIE directly, or indirectly through one or more partnerships, grantor trusts, or QIEs. Under this comment's recommended approach, a foreign person would be included in the more than 50 percent control test if the domestic C corporation had actual knowledge that the foreign person has cross-ownership of the QIE after inquiry with any person that is at least a 5-percent shareholder of the domestic C corporation (after applying the rules of section 318(a)). The comment reasoned that foreign investors should be considered incidental and thus should not be counted when measuring direct or indirect foreign control of the QIE when they invest through a domestic C corporation and do not have cross-ownership of the QIE directly or through related parties, or do hold interests in both entities but do not individually or collectively control the domestic C corporation.

Finally, one comment advocated that a look-through approach to a domestic C corporation should not apply when that corporation has material business activities unrelated to its investment in a QIE's stock with potential safe harbors such as where the corporation is registered as an investment adviser under the Investment Company Act of 1940 or the foreign owner of the domestic C corporation is actively traded on an established securities market outside of the United States. The comment reasoned that such cases are unlikely to be structured transactions of the type identified by the proposed regulations. Similarly, another comment also proposed that the look-through approach should not apply if a domestic C corporation would be treated as engaged in a U.S. trade or business if it had been a foreign corporation (such that the corporation is not a mere shell), and this exception could be further limited by ensuring that the value of the QIE stock held by the domestic C corporation is less than a certain threshold of the affiliated group's total assets.

The final regulations do not adopt any of the recommended modifications to the domestic corporation look-through rule. Several suggested modifications would limit the application of the rule to situations that indicate that foreign persons are using a domestic C corporation to establish domestic control of a QIE so that their direct investments in the QIE benefit from the DC-QIE exception. However, as discussed in part I.A of this Summary of Comments and Explanation of Revisions, the proposed and final regulations serve a broader purpose by interpreting the meaning of “indirect” ownership under section 897(h)(4)(B) to effectuate the policy of the DC-QIE exception by ensuring that the exception is available only when a QIE is controlled by United States persons. The comments also proposed various modifications intended to limit or alter the application of the rule; the Treasury Department and the IRS are of the view that these would introduce additional complexity, such as requiring an examination of the business activities of a domestic C corporation. Furthermore, a modification that would treat domestic C corporations that own less than 10 percent of a QIE as a non-look-through person would not alleviate concerns regarding the ability to identify shareholders through multiple tiers of ownership, and could result in disparate and inconsistent results as to which foreign owners are taken into account in measuring domestic control of a QIE (for example, a foreign non-look-through person that wholly owns a domestic C corporation that owns 9 percent of a QIE would not be taken into account, while a foreign non-look-through person that owns 50 percent of a domestic C corporation that owns 10 percent of the QIE would be taken into account). The Treasury Department and the IRS also do not agree that the domestic corporation look-through rule should only apply if 25 percent or more of the corporation's stock is owned by a single foreign non-look-through person (taking into account section 318 constructive ownership rules), as the DC-QIE exception looks to any measure of foreign ownership of a QIE and such a high threshold would inappropriately exempt foreign persons owning significant indirect interests in QIEs from look-through treatment.

Although the final regulations do not adopt any of the specific recommendations to the domestic corporation look-through rule, the Treasury Department and the IRS agree that the scope of the rule should be narrowed to address compliance concerns and to ensure the rule is more appropriately limited to situations where significant indirect ownership by foreign persons indicative of foreign control is present. After considering the various suggestions raised in comments, the Treasury Department and the IRS have determined that this is best achieved by increasing the amount of foreign ownership required to look through a non-public domestic C corporation from 25 percent or more to more than 50 percent. Increasing the threshold to more than 50 percent significantly narrows the scope of look-through treatment to non-public domestic C corporations that are controlled by foreign persons, and is consistent with the measurement of control for purposes of the domestically controlled QIE test. This change is also consistent with the policy of the DC-QIE exception and other provisions in section 897 that are based on a 50-percent threshold. See, for example, section 897(c)(2) (providing that a corporation is a United States real property holding corporation if the fair market value of its United States real property interests (“USRPIs”) meets a 50 percent or greater threshold). Thus, rather than a “foreign-owned domestic corporation,” the final regulations apply look-through treatment with respect to a “foreign-controlled domestic corporation,” which is defined as any non-public domestic C corporation if foreign persons hold directly or indirectly more than 50 percent of the fair market value of that corporation's outstanding stock (the “final domestic corporation look-through rule”). § 1.897-1(c)(3)(v)(B). In addition, the final regulations adopt a transition rule for existing QIE structures, as discussed in part IV of this Summary of Comments and Explanation of Revisions.

Section 897(l) provides an exception to the application of section 897(a) for certain foreign pension funds and their wholly owned subsidiaries. As originally enacted in the PATH Act, section 897(l)(1) provided that section 897 does not apply to any USRPI held directly (or indirectly through one or more partnerships) by, or to any distribution received from a REIT by, a QFPF or any entity all of the interests of which are held by a QFPF. Congress later made several technical amendments to section 897(l) in section 101(q) of the Tax Technical Corrections Act of 2018, Public Law 115-141, div. U (the “2018 technical correction”). As amended by the 2018 technical correction, section 897(l) provides that neither a QFPF nor an entity all the interests of which are held by a QFPF is treated as a nonresident alien individual or foreign corporation for purposes of section 897.

The proposed regulations addressed uncertainty as to whether QFPFs and entities wholly owned by one or more QFPFs (“QCEs”), which are treated as not “nonresident alien individuals or foreign corporations” for purposes of section 897, are treated as foreign persons for purposes of the DC-QIE exception. Specifically, proposed § 1.897-1(c)(3)(iv)(A) provided that a QFPF, including any part of a QFPF, or a QCE is a foreign person for purposes of the DC-QIE exception (the “QFPF DC-QIE rule”).

Although one comment stated that it was generally in agreement with the QFPF DC-QIE rule, other comments recommended that the rule be withdrawn because it is an incorrect reading of the statute and contrary to congressional intent. One comment contended that the preamble to the proposed regulations failed to consider the existing definition of “foreign person” in § 1.897-9T(c) (which includes a foreign corporation, a foreign partnership, a foreign trust, or a nonresident alien individual) and noted that Congress is presumed to have knowledge of that regulatory definition. The comment also contended that the text of section 897(l) is clear and that, without any textual ambiguity, the Treasury Department and the IRS lack the authority to issue the QPFF DC-QIE rule.

Another comment submitted that the legislative history and policy of section 897, including the DC-QIE exception and the section 897(l) exception for QFPFs, indicate that 50 percent or more ownership of a QIE by a QFPF results in the DC-QIE exception being available to other foreign investors. The comment's overall recommendation was to clarify the definition of foreign person in section 897(h)(4)(B) and (C) to have the same meaning as “a nonresident alien individual or a foreign corporation” in section 897(a). The comment included several reasons for its recommendation. First, section 897(l) refers generally to section 897, rather than solely to section 897(a), which the comment argued indicates that section 897(l) is intended to be given effect for all purposes under section 897. According to the comment, the effect of section 897(l) on the DC-QIE exception can be analogized to a special election in section 897(i) for a foreign corporation to be treated as a domestic corporation for purposes of section 897 because, when that election applies, it has effect for all of section 897 and can benefit other investors in QIEs even though they are not party to the election. The comment also noted that the 2018 technical correction should be presumed to be a more accurate reflection of the original intent of Congress, which was to align QFPFs with exempt U.S. pension funds. Finally, the comment noted that because a QFPF is not taxed under section 897(h)(1), there is no policy reason to treat it as a foreign person for other rules such as the DC-QIE exception, the foreign ownership percentage rule in section 897(h)(3) or the wash sale rule in section 897(h)(5).

The Treasury Department and the IRS have determined that the QFPF DC-QIE rule reflects the proper interpretation of the statute and congressional intent. The term “nonresident alien individuals or foreign corporations” in section 897(l) (introduced only in the 2018 technical correction) differs from “foreign persons” in section 897(h)(4)(B), and the purposes of the two provisions also differ. Congress provided no indication that it intended for the definition of foreign person in § 1.897-9T(c) to apply to confer non-foreign person status on QFPFs for purposes of the DC-QIE exception. Instead, the term “nonresident alien individuals or foreign corporations” appears in section 897(a) and similar provisions to refer to the persons that are directly subject to tax under FIRPTA. The Treasury Department and the IRS also do not agree that a QFPF is analogous to a foreign corporation that has elected to be treated as a domestic corporation under section 897(i) because that election explicitly treats a foreign corporation as a domestic corporation and therefore not a foreign person. In contrast, section 897(l) treats a QFPF as not a nonresident alien individual or a foreign corporation but does not address whether a QFPF is also not a foreign person.

The Treasury Department and the IRS agree that it is reasonable to presume that the changes made in the 2018 technical correction are a more accurate reflection of original congressional intent, which the preamble to the proposed regulations described (allowing a QFPF and QCE to jointly own a USRPI and qualify for section 897(l) with respect to their partial USRPI interests, as well as clarifying that the section 897(l) exception applies to distributions from all QIEs and not just REITs). 87 FR 80100. However, the Treasury Department and the IRS disagree with the assertion that the 2018 technical correction should be interpreted to bestow the benefit of the DC-QIE exception on foreign investors that cannot claim the section 897(l) exception. Such an interpretation would be inconsistent with the intent of section 897(l) as originally enacted in the PATH Act, which was to provide an exception from section 897 to QFPFs (and QCEs). Where possible, as in this case, the technical correction should be viewed in a manner consistent with a core principle of the original legislation. See Fed. Nat'l Mortgage Assoc. v. United States, 56 Fed. Cl. 228, 234, 237 (2003), rev'd and remanded on other grounds, 379 F.3d 1303 (Fed. Cir. 2004) (“Congress turns to technical corrections when it wishes to clarify existing law or repair a scrivener's error, rather than to change the substantive meaning of the statute. . . . [A] technical correction that merely restores the rule Congress intended to enact cannot be construed as a fundamental change in the operation of the statute.”); STAFF OF THE JOINT COMM. ON TAX'N, Overview of Revenue Estimating Procedures and Methodologies Used by the Staff of the Joint Committee on Taxation (JCX-1-05) 33 (2005) (describing a technical correction as “legislation that is designed to correct errors in existing law in order to fully implement the intended policies of previously enacted legislation” and a change that “conforms to and does not alter the intent” of the underlying legislation).

The comment discussed above asserts that there is no policy reason to treat a QFPF as a foreign person for other provisions in section 897(h) such as the DC-QIE exception, given that the QFPF is not taxed under section 897(h)(1). The Treasury Department and the IRS disagree based on the statute and its policy. As described earlier in this preamble, the policy of the DC-QIE exception looks to foreign control, not control by taxable persons. The presence or absence of taxation of the controlling persons is not determinative. Additionally, Congress expressed in section 897(l) an intent to provide a tax benefit specifically for QFPFs, and not for other owners of a DC-QIE that would benefit from the QFPF's treatment. Therefore, the Treasury Department and the IRS have determined that the appropriate interpretation of the statute is one that only gives effect to the purpose of section 897(l) to provide an exception from section 897 for QFPFs, rather than a construction that would give non-QFPF investors the ability to rely on section 897(l) to benefit under the DC-QIE exception. The DC-QIE exception is a separate provision with underlying policies that focus on foreign control rather than taxability of controlling persons, and these policies are inconsistent with treating a QFPF as a United States person for purposes of the DC-QIE exception. Accordingly, the final regulations do not adopt the comments' recommendations.

One comment noted that there are a large number of investment vehicles that are publicly registered with the Securities and Exchange Commission (“SEC”) that own QIEs but are not regularly traded and asserted that the final regulations should treat these investment vehicles offered to retail investors (for example, non-traded publicly registered REITs, non-traded publicly registered RICs, or publicly registered open-ended funds) as non-look-through persons. The comment noted that the same reasoning for applying non-look-through treatment to public domestic C corporations and publicly traded partnerships—that is, difficulty in looking through to the entity's owners and the unlikelihood for use as an intermediary entity to establish domestic control—applied equally to those investment vehicles.

The final regulations do not adopt this comment with respect to registered investment vehicles that are QIEs because section 897(h)(4)(E) already provides specific rules with respect to QIE ownership by other QIEs that are incorporated in the final regulations. In particular, under section 897(h)(4)(E)(ii), stock in a QIE held by certain public QIEs is treated as held by a foreign or United States person based on whether the public QIE is itself domestically controlled. § 1.897-1(c)(3)(iii)(C). Section 897(h)(4)(E)(iii) provides that stock of a QIE held by a QIE that is not a public QIE is only treated as held by a United States person in proportion to the stock of the non-public QIE that is held by a United States person. Section 897(h)(4)(E)(iii) thus contemplates look-through treatment for non-public QIEs, even if such QIEs are publicly registered with the SEC, and this treatment is reflected in the final regulations. § 1.897-1(c)(3)(v)(C).

However, the Treasury Department and the IRS are of the view that the treatment of certain RICs that are not QIEs should be aligned with the treatment of other publicly held entities that are not QIEs. The proposed regulations provided that any RIC that is not a QIE, and thus not subject to the rules that apply to public QIEs, is treated as a look-through person. With respect to RICs whose shares are publicly traded or otherwise widely held, this treatment may be viewed as inconsistent with the treatment of publicly traded partnerships and public domestic C corporations, neither of which is subject to look-through treatment under the proposed regulations primarily due to compliance and administrability concerns. The final regulations therefore provide that a public RIC, generally defined as a RIC that is not a QIE and whose shares are (i) regularly traded on an established securities market or (ii) common stock that is continuously offered pursuant to a public offering and held by at least 500 shareholders, is generally treated as a non-look-through person. § 1.897-1(c)(3)(v)(D) and (I). However, for reasons similar to those discussed in part I.C of this Summary of Comments and Explanation of Revisions (regarding foreign-controlled domestic corporations, which are treated as look-through persons), a RIC will not be a public RIC, and thus will be a look-through person, if the QIE being tested for domestically controlled status under § 1.897-1(c)(3) has actual knowledge that the RIC is foreign controlled, which is determined by treating the RIC as a non-public domestic C corporation and applying § 1.897-1(c)(3)(v)(B). § 1.897-1(c)(3)(v)(I).

The proposed regulations provided that a person holding less than five percent of U.S. publicly traded stock of a QIE at all times during the testing period, determined without regard to proposed § 1.897-1(c)(3)(ii)(A), is treated as a United States person that is a non-look-through person with respect to that stock, unless the QIE has actual knowledge that such person is not a United States person. Section 897(h)(4)(E)(i); proposed § 1.897-1(c)(3)(iii)(A). To prevent the avoidance of the actual knowledge exception to this rule, the final regulations modify the rule to provide that it will also not apply if the QIE has actual knowledge that such person is foreign controlled (treating any person that is not a non-public domestic C corporation as a non-public domestic C corporation for this purpose). § 1.897-1(c)(3)(iii)(A).

The proposed regulations also provided non-look-through treatment for public domestic C corporations and publicly traded partnerships, which were generally defined to include entities with a class of stock or interests regularly traded on an established securities market. Proposed § 1.897-1(c)(3)(v)(D), (G) and (I). In the final regulations, these definitions exclude domestic entities that are known to be foreign controlled. Thus, consistent with the treatment of public RICs and for reasons similar to those discussed in part I.C of this Summary of Comments and Explanation of Revisions (regarding foreign-controlled domestic corporations, which are treated as look-through persons), a domestic C corporation or a domestic partnership will not be a public domestic C corporation or a publicly traded partnership, respectively, if the QIE being tested for domestically controlled status under § 1.897-1(c)(3) has actual knowledge that the corporation or partnership is foreign controlled (treating the entity as a non-public domestic C corporation for this purpose). § 1.897-1(c)(3)(v)(G) and (J). In such case, the domestic C corporation or domestic partnership will therefore be a look-through person. § 1.897-1(c)(3)(v)(B) through (E).

One comment recommended that the final regulations provide guidance on how a domestic C corporation may certify to a QIE that it is not a foreign-owned domestic corporation. The comment suggested that the regulations provide a model certification to confirm that a domestic C corporation is not foreign owned, such as a revised Form W-9.

The final regulations do not provide guidance regarding the procedures for determining whether a domestic C corporation is a foreign-controlled domestic corporation, nor do they provide any procedures generally for a QIE to identify its non-look-through person owners for purposes of determining whether the QIE is domestically controlled. A QIE must take appropriate measures to determine the identity of its direct and indirect shareholders in determining whether it is domestically controlled, and the final regulations do not prescribe a specific form or method as to how it solicits or receives information from its shareholders. Guidance with respect to the manner in which a QIE determines the identity of its relevant shareholders for purposes of establishing domestic control is beyond the scope of this rulemaking but may be considered in a separate guidance project.

Current regulations under section 1445 (imposing withholding of tax on dispositions of USRPI) provide the circumstances under which a transferee of property can ascertain that there is no duty to withhold under section 1445(a) because the transferor is not a foreign person, the property acquired is not a USRPI, or an exception to withholding applies. § 1.1445-2. Section 1.1445-2(c)(3) provides that no withholding is required with respect to an acquisition of an interest in a domestic corporation if the transferor provides the transferee with a copy of a statement, issued by the corporation pursuant to § 1.897-2(h), certifying that the interest in the corporation is not a USRPI. The transferor must request the statement before the transfer, which may be relied on if the statement is dated not more than 30 days before the date of the transfer. A transferee may also rely on a corporation's statement that is voluntarily provided by the domestic corporation in response to a request from the transferee, if that statement otherwise complies with the requirements of §§ 1.1445-2(c)(3) and 1.897-2(h).

Under § 1.897-2(h)(1), a foreign person holding an interest in a domestic corporation may request that the corporation inform the person whether the interest constitutes a USRPI, which the corporation is required to provide within a reasonable period after receipt of such a request. A statement must be provided by the domestic corporation to the foreign person indicating the corporation's determination, and notice must be provided to the IRS in accordance with § 1.897-2(h)(2). Section 1.897-2(h)(3), however, provides that the requirements of § 1.897-2(h) do not apply to “domestically-controlled REITs, as defined in section 897(h)(4)(B),” although a corporation not otherwise required to comply with the requirements of § 1.897-2(h) may voluntarily choose to comply with the requirements of § 1.897-2(h)(4) and attach a statement to its income tax return informing the IRS that it is not a United States real property holding corporation.

The availability of the procedures in § 1.1445-2(c)(3) to holders of stock in a domestically controlled QIE is unclear given its reference to a statement provided under § 1.897-2(h), which is explicitly inapplicable to domestically controlled QIEs under § 1.897-2(h)(3). Although § 1.897-2(h) generally does not apply to domestically controlled QIEs pursuant to § 1.897-2(h)(3) (and, therefore, the corporation is not required, upon request, to provide a statement to a person holding an interest in the corporation), this should not preclude the availability of the rules in § 1.1445-2(c)(3) to transferors of interests seeking to avoid withholding under section 1445 when the corporation voluntarily provides a statement to an interest holder that otherwise complies with § 1.897-2(h). Absent the availability of these procedures, the transferor would not be able to establish that it is transferring an interest in a domestically controlled QIE and is thus not subject to withholding under section 1445(a). The final regulations thus revise the rules in §§ 1.897-2(h)(3) and 1.1445-2(c)(3) to clarify the procedures available to a transferor to certify to a transferee that no withholding is required because the DC-QIE exception applies. As revised, the final regulations confirm that a domestic corporation may voluntarily provide a statement in response to a request from a transferor certifying that an interest in the corporation is not a USRPI because the corporation is a domestically controlled QIE, which the transferor may furnish to the transferee, provided the statement issued by the corporation otherwise complies with the requirements of § 1.897-2(h).

A comment observed that proposed § 1.897-1(c)(3)(vi)(D) ( Example 4 ) contained a mathematical error. The final version of this example corrects that error, which does not otherwise affect the overall conclusion that the entity at issue does not qualify as a domestically controlled QIE. § 1.897-1(c)(3)(vii)(D) ( Example 4 ). The final regulations make other revisions to the examples in proposed § 1.897-1(c)(3)(vi) to clarify the operation of certain rules, but which are not intended to alter the conclusions or substance of those examples.

The proposed regulations generally were proposed to apply to transactions occurring on or after the date that those regulations are published as final regulations in the Federal Register (“the finalization date”). The preamble to the proposed regulations noted, however, that the rules applicable for determining whether a QIE is domestically controlled may be relevant for determining QIE ownership during periods before the finalization date to the extent the testing period related to a transaction that occurs on or after the finalization date includes periods before that date.

Comments raised concerns with the proposed applicability date; in particular, they noted that it would have a retroactive effect because of the testing period element of the DC-QIE exception and argued that, if adopted, the domestic corporation look-through rule should apply on a fully prospective basis with no application to any portion of a testing period before the finalization date. Further, these comments characterized the proposed regulations as a change from existing law and asserted that applying the rules to existing structures would be inappropriate because restructuring to comply with the rules would be difficult and costly, and buyers may be less inclined to invest in a structure that may be “tainted” as failing to qualify for the DC-QIE exception.

Comments generally advocated for the following types of transition relief: (i) for QIEs in existence on the date the proposed regulations were issued, provide an exception (subject to termination rules like those in § 301.7701-2(d)) such that a foreign-owned domestic corporation is not treated as a look-through person; (ii) exempt foreign investors in existing QIEs from the domestic corporation look-through rule to the extent of existing ownership and capital commitments as of the date the proposed regulations were issued; (iii) only apply the domestic corporation look-through rule to QIE stock acquired by a foreign-owned domestic corporation after the finalization date; or (iv) delay application of the domestic corporation look-through rule to existing QIEs for some period ranging from at least 120 days after the finalization date to tax years beginning on or after January 1, 2028 (drawing from the general five-year testing period standard).

The final regulations do not adopt the suggestion to delay application of the final domestic corporation look-through rule, which would exempt both existing and new QIE structures from the rule. However, the Treasury Department and the IRS have determined that, although the final domestic corporation look-through rule represents the appropriate application of section 897(h)(4)(B), its effect should be limited with respect to investors that may have entered into structures with the expectation that domestic control of a QIE would be determined without regard to that rule. Thus, consistent with the first three types of comments noted above, the final regulations include a transition rule that, for a ten-year period, exempts existing structures from the final domestic corporation look-through rule, provided they meet certain requirements. § 1.897-1(c)(3)(vi). These requirements are intended to ensure that the final domestic corporation look-through rule does not apply to preexisting business arrangements, but only to the extent the QIE does not acquire a significant amount of new USRPIs and does not undergo a significant change in its ownership (subject to an exception for acquisitions of a USRPI or QIE interest pursuant to a previous binding commitment). § 1.897-1(c)(3)(vi)(A) and (E). If either of these two thresholds is exceeded, the QIE at that time becomes subject to the final domestic corporation look-through rule like any other QIE. § 1.897-1(c)(3)(vi)(B).

A QIE is considered to have acquired a significant amount of new USRPIs if the total fair market value of the USRPIs it acquires directly and indirectly exceeds 20 percent of the fair market value of the USRPIs held directly and indirectly by the QIE as of April 24, 2024. § 1.897-1(c)(3)(vi)(A)( 2 ). The final regulations provide that the value of the USRPIs held directly and indirectly by a QIE on April 24, 2024 is determined as of that date and that, for this purpose, taxpayers may use the most recently calculated amounts under the quarterly tests described in section 851(b)(3) or 856(c)(4), as applicable. § 1.897-1(c)(3)(vi)(D). By using these existing rules the final regulations minimize the need to make additional or complex valuations.

In determining whether there has been a significant change in the ownership of a QIE, the final regulations consider whether the direct or indirect ownership of the QIE by non-look-through persons (determined by applying the final domestic corporation look-through rule) has increased by more than 50 percentage points in the aggregate relative to the QIE stock owned by such non-look-through persons on April 24, 2024. § 1.897-1(c)(3)(vi)(A)( 3 ). Because this rule applies on a percentage basis, a non-pro-rata issuance or redemption of stock is counted towards the 50 percentage point amount. To simplify the determination of changes in ownership of stock of a QIE that is publicly traded, the final regulations disregard transfers by any person (regardless of whether they are a non-look-through person) that owns a less than five-percent interest in the stock of the QIE, unless the QIE has actual knowledge of that person's ownership. § 1.897-1(c)(3)(vi)(G).

The transition rule applies until April 24, 2034, or, if earlier, until the requirements precluding significant acquisitions of USRPIs and changes in ownership are not met, at which time the final domestic corporation look-through rule applies in determining whether a QIE is domestically controlled. § 1.897-1(c)(3)(vi)(B). The ten-year period is intended to provide sufficient time to mitigate the impact of the final domestic corporation look-through rule on existing QIEs and their investors, but ensures that all QIEs are eventually subject to the same rules. However, even after the transition rule no longer applies, the final domestic corporation look-through rule is prospective only and thus does not apply to any portion of a testing period during which the transition rule applied to a QIE. § 1.897-1(c)(3)(vi)(C). Thus, for example, if the transition rule ceases to apply to a QIE due to a change in its ownership but, at such time, the QIE is a domestically controlled QIE notwithstanding the final domestic corporation look-through rule, the determination of domestic control for the testing period of a subsequent disposition of QIE stock may disregard the final domestic corporation look-through rule to the extent the transition rule applied.

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.

The Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) (PRA) generally requires that a Federal agency obtain the approval of the OMB before collecting information from the public, whether such collection of information is mandatory, voluntary, or required to obtain or retain a benefit. The collection of information in § 1.1445-2(c)(3) is a statement provided by a domestic corporation that certifies that an interest in such corporation is not a U.S. real property interest. Section 1.1445-2(c)(3) clarifies that the existing procedure may also be used by a domestic corporation to certify that it is a domestically controlled QIE (as determined under § 1.897-1(c)(3)), as long as the certification is voluntarily issued and otherwise complies with the existing requirements in § 1.897-2(h).

This modification to § 1.1445-2(c)(3) clarifies the existing scope of the collection of information. For purposes of the PRA, the reporting burden associated with the collections of information in § 1.1445-2(c)(3) will be reflected in the Paperwork Reduction Act Submissions associated with the section 1445 regulations (OMB control number 1545-0902).

As discussed in the preamble to the proposed regulations, there may be some uncertainty as to whether QFPFs and QCEs, which are treated as not “nonresident alien individuals or foreign corporations” for purposes of section 897, are treated as foreign persons for purposes of the DC-QIE exception. Treating QFPFs and QCEs as non-foreign investors for purposes of the DC-QIE exception has the potential to expand the effect of section 897(l) to foreign investors who are neither QFPFs nor QCEs (by exempting such investors from tax under section 897(a)). These regulations eliminate any uncertainty that taxpayers may have as to the proper classification of QFPFs and QCEs for purposes of the DC-QIE exception by providing that QFPFs and QCEs are treated as foreign persons for purposes of the DC-QIE exception.

Also as discussed in the preamble to the proposed regulations, there is uncertainty regarding the determination of whether stock of a QIE is held “directly or indirectly” by foreign persons for purposes of the DC-QIE exception. These regulations provide rules to clarify this determination.

Because there was a possibility of significant economic impact on a substantial number of small entities as a result of the rules relating to the treatment of QFPFs and QCEs for purposes of the DC-QIE exception and the definition of a domestically controlled QIE, the proposed regulations provided an initial regulatory flexibility analysis and requested comments from the public on the number of small entities that may be impacted and whether that impact will be economically significant. No comments were received.

The regulation relating to the treatment of QFPFs and QCEs for purposes of the DC-QIE exception affects other foreign investors in QIEs. The regulation defining a domestically controlled QIE also affects foreign investors in QIEs. Because an estimate of the number of small businesses affected is not currently feasible, this final regulatory flexibility analysis assumes that a substantial number of small businesses will be affected. The Treasury Department and the IRS do not expect that these regulations will affect a substantial number of small nonprofit organizations or small governmental jurisdictions.

These regulations do not impose additional reporting or recordkeeping obligations. However, see Part II of this Special Analysis describing certain voluntary reporting that these regulations clarify is available in § 1.1445-2(c)(3) by a domestic corporation to certify that it is a domestically controlled QIE.

The final regulations address potential uncertainty under current law and do not impose an additional economic burden. Consequently, the rules represent the approach with the least economic impact.

These regulations clarify the treatment of QFPFs and QCEs for purposes of the DC-QIE exception. The rules are intended to ensure that the exemption under section 897(l) does not inappropriately inure to non-QFPFs or non-QCEs by treating QFPFs and QCEs as domestic investors for purposes of the DC-QIE exception. These regulations also clarify whether stock of a QIE is held “directly or indirectly” by foreign persons in determining whether the DC-QIE exception applies. The legal basis for these regulations is contained in sections 897(l) and 7805.

Section 897(a) applies to nonresident alien individuals and foreign corporations, and neither the statute nor prior regulations establish different rules for small entities. Moreover, the DC-QIE exception is measured based on the ownership interests in a QIE, regardless of the size of the investor. Because the DC-QIE exception takes into account all investors, regardless of size, the Treasury Department and the IRS have concluded that the DC-QIE exception should apply uniformly to large and small business entities. The Treasury Department and the IRS did not consider any significant alternative to the rule that provides for the treatment of QFPFs and QCEs under the DC-QIE exception.

The Treasury Department and the IRS did consider alternatives for the rule that defines a domestically controlled QIE, including one alternative that generally would treat all domestic C corporations as non-look-through persons (that is, without the special rule for foreign-controlled domestic corporations discussed in part I of the Summary of Comments and Explanation of Revisions section of this preamble). However, the Treasury Department and the IRS concluded that the look-through approach in the final regulations best serves the purposes of the DC-QIE exception while also taking into account “indirect” ownership of QIE stock by foreign persons in determining whether a QIE is domestically controlled under section 897(h)(4)(B).

Pursuant to section 7805(f) of the Code, the proposed regulations (REG-100442-22) preceding these final regulations were submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on the impact on small businesses 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. The final 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 (entitled “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. The final regulations do not have federalism implications, do not impose substantial direct compliance costs on State and local governments, and do not preempt State law within the meaning of the Executive order.

IRS Revenue Procedures, Revenue Rulings, Notices, and other guidance 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 Publishing Office, Washington, DC 20402, or by visiting the IRS website at www.irs.gov.

The principal author of these final regulations is Arielle Borsos, Office of Associate Chief Counsel (International). However, other personnel from the Treasury Department and the IRS participated in their development.

Accordingly, 26 CFR part 1 is amended as follows:

Section 105(e) of the Federal Alcohol Administration Act (FAA Act), 27 U.S.C. 205(e), authorizes the Secretary of the Treasury to prescribe regulations for the labeling of wine, distilled spirits, and malt beverages. The FAA Act provides that these regulations should, among other things, prohibit consumer deception and the use of misleading statements on labels and ensure that labels provide the consumer with adequate information as to the identity and quality of the product. The Alcohol and Tobacco Tax and Trade Bureau (TTB) administers the FAA Act pursuant to section 1111(d) of the Homeland Security Act of 2002, codified at 6 U.S.C. 531(d). The Secretary has delegated the functions and duties in the administration and enforcement of these provisions to the TTB Administrator through Treasury Order 120-01, dated December 10, 2013.

Part 4 of the TTB regulations (27 CFR part 4) authorizes TTB to establish definitive viticultural areas and regulate the use of their names as appellations of origin on wine labels and in wine advertisements. Part 9 of the TTB regulations (27 CFR part 9) sets forth standards for the preparation and submission to TTB of petitions for the establishment or modification of American viticultural areas (AVAs) and lists the approved AVAs.

Section 4.25(e)(1)(i) of the TTB regulations (27 CFR 4.25(e)(1)(i)) defines a viticultural area for American wine as a delimited grape-growing region having distinguishing features as described in part 9 of the regulations and, once approved, a name and a delineated boundary codified in part 9 of the regulations. These designations allow vintners and consumers to attribute a given quality, reputation, or other characteristic of a wine made from grapes grown in an area to the wine's geographic origin. The establishment of AVAs allows vintners to describe more accurately the origin of their wines to consumers and helps consumers to identify wines they may purchase. Establishment of an AVA is neither an approval nor an endorsement by TTB of the wine produced in that area.

Section 4.25(e)(2) of the TTB regulations (27 CFR 4.25(e)(2)) outlines the procedure for proposing an AVA and allows any interested party to petition TTB to establish a grape-growing region as an AVA. Section 9.12 of the TTB regulations (27 CFR 9.12) prescribes standards for petitions to establish or modify AVAs. Petitions to establish an AVA must include the following:

• Evidence that the area within the proposed AVA boundary is nationally or locally known by the AVA name specified in the petition;

• An explanation of the basis for defining the boundary of the proposed AVA;

• A narrative description of the features of the proposed AVA affecting viticulture, such as climate, geology, soils, physical features, and elevation, that make the proposed AVA distinctive and distinguish it from adjacent areas outside the proposed AVA boundary;

• The appropriate United States Geological Survey (USGS) map(s) showing the location of the proposed AVA, with the boundary of the proposed AVA clearly drawn thereon; and

• A detailed narrative description of the proposed AVA boundary based on USGS map markings.

TTB received a petition from the Yucaipa Valley Wine Alliance, proposing establishment of the “Yucaipa Valley” AVA. The proposed AVA is in San Bernardino County, California, and is not within any established AVA. The proposed AVA covers 36,467 acres and includes approximately 23 vineyards and two wineries. The petition identifies the distinguishing features of the proposed Yucaipa Valley AVA as its elevation and climate.

The proposed Yucaipa Valley AVA is a region of rolling hills in the foothills of the San Bernardino Mountains and includes the incorporated municipalities of Yucaipa and Calimesa and the unincorporated area of Oak Glen. Elevations within the proposed Yucaipa Valley AVA range from 2,000 to 4,600 feet. According to the petition, sunlight becomes more concentrated at high elevations. As a result, grapes receive a “tan,” which results in thicker skin than the same varietals grown at lower elevations. The petition states that thick skins contribute to the color and tannin levels of the resulting wine and protect developing grapes from the dramatic climate shifts that can occur in high altitude vineyards.

By contrast, Yucaipa Ridge, which is located to the immediate north and northeast of the proposed Yucaipa Valley AVA, is a mountain range of steep slopes with elevations up to 2,000 feet higher than the proposed AVA. The region east of the proposed AVA has elevations similar to those within the proposed AVA but is not included in the proposed AVA because it is largely uninhabited and undeveloped, has few roads, is largely covered by a national forest that is not available for commercial viticulture, and does not have historical ties to the region known as the Yucaipa Valley. Cherry Valley and Beaumont are communities which extend from the southeast to the south of the proposed AVA and have elevations similar to those in the lower portions of the proposed AVA. However, these areas do not have the rolling hills found in the Yucaipa Valley. The San Timoteo Canyon extends from the southwest to the south of the proposed AVA and has elevations that are lower than those in the proposed AVA, ranging from 1,600 to 2,000 feet. To the west of the proposed AVA is the Redlands Valley, which also has lower elevations ranging from 1,100 to 2,000 feet.

The petition described the climate of the proposed Yucaipa Valley AVA as a hot, dry climate suitable for growing grape varietals such as Cabernet Sauvignon, Merlot, Zinfandel, Syrah, Malbec, Nebbiolo, Barbera, and Petite Sirah. Within the city of Yucaipa, the average high temperature is 78.3 degrees Fahrenheit (F), and the average low temperature is 48.7 degrees F. August is typically the warmest month, with an average high of 97 degrees F, and December is typically the coolest month, with an average minimum temperature of 40 degrees F. The record high temperature in the city of Yucaipa is 114 degrees F, while the record low temperature is 11 degrees F. The city of Yucaipa receives an average cumulative rainfall of 4.14 inches during the growing season of April through October. The average amount of precipitation for the city of Yucaipa during the winter months, November through March, is substantially greater, 15.35 inches, with an average of one inch being snow.

By contrast, the region to the west of the proposed AVA, is slightly warmer and drier, while the region to the north and northeast is cooler. The average high temperature in the city of Redlands, located west of the proposed AVA, is 79.6 degrees F, and the average low temperature is 50.5 degrees F. August is typically the warmest month in Redlands, with an average high of 96 degrees F, and December is typically the coolest month, with an average minimum temperature of 40 degrees F. The record high temperature in Redlands is 118 degrees F, and the record low temperature is 18 degrees F. Redlands receives an average of 10.86 inches of winter precipitation, but seldom receives snow due to its warmer winter temperatures. In the community of Forest Falls, located to the north and northeast of the proposed AVA, the average high temperature is 61.5 degrees F, and the average low temperature is 40.9 degrees F. August is typically the warmest month in Forest Falls, with an average high of 81 degrees F. The record high temperature is 106 degrees F, and the record low temperature is 5 degrees F. The petition did not include temperature data from the regions to the northwest, east, and south of the proposed Yucaipa Valley AVA but did note that the city of Beaumont, located south and southeast of the proposed AVA, receives an average winter precipitation amount very similar to that of the proposed AVA, although it seldom has any snow.

TTB published Notice No. 214 in the Federal Register on September 21, 2022 (87 FR 57657), proposing to establish the Yucaipa Valley AVA. In the notice, TTB summarized the evidence from the petition regarding the name, boundary, and distinguishing features for the proposed AVA. The notice also included information from the petition comparing the distinguishing features of the proposed AVA to the surrounding areas. For a detailed description of the evidence relating to the name, boundary, and distinguishing features of the proposed AVA, and for a detailed comparison of the distinguishing features of the proposed AVA to the surrounding areas, see Notice No. 214. In Notice No. 214, TTB solicited comments on the accuracy of the name, boundary, and other required information submitted in support of the petition. The comment period closed on November 21, 2022.

In response to Notice No. 214, TTB received twelve comments. Eight of the comments fully support the proposed AVA (comments 1, 2, 3, 4, 6, 7, 8, and 10). The comments state that, among other things, the proposed AVA could increase consumer awareness of wines from the area and promote economic development in the city of Yucaipa and in the other communities within and near the proposed AVA.

Two comments (comments 11 and 12) agree that the petition fulfilled TTB's requirements for the establishment of an AVA. These commenters, however, believe that before deciding to establish the AVA, TTB should conduct studies on the effects the AVA may have. Comment 11 believes TTB should study the effect of a potential AVA on “property values, displaced ownership, or general effects on the market” for occupants of the area, regardless of whether they are involved in the wine industry. Comment 12 suggests that TTB study the effects an AVA may have on water consumption because an AVA may promote increased agricultural activities and, therefore, increase water consumption in a region that has limited water resources.

Two comments (comments 5 and 9) oppose the proposed Yucaipa Valley AVA. Comment 5 states that the region is “too small for such a venture,” that the proposed vineyards are close to an earthquake fault line, that citizens do not want the vineyards depleting the “already low” local water table, and that establishing an AVA could increase traffic on small streets and raise the risk of drunk drivers. Comment 9 also opposes the proposed AVA due to the potential for increased traffic and drunk driving that could “pose a serious threat to local drivers, pedestrians, and children in the community.” Additionally, the commenter expresses concern that an AVA designation could raise property values and property taxes if the increased tourism also leads to a rise in the purchase of vacation homes in the area. The commenter also believes that small vineyards in the proposed AVA “may have to restructure their winemaking processes to comply with this 85 percent standard required to attach the AVA label to their wines.” The commenter asserts that such a move could be costly because it “will require winemakers to develop new formulas, increase grape production, and adapt their facilities to accommodate the changes.”

TTB establishes AVAs to allow winemakers to better describe, in labeling and advertising, the origins of their wines and to allow consumers to better identify wines they may purchase. TTB reviews any petition submitted to it to establish an AVA and determines if the petition meets the regulatory criteria. Labeling and advertising of wines using an AVA is voluntary, and approving an AVA does not apply any new requirements on grape growers or winemakers in the region other than any addressed in the section “Impact on Current Wine Labels.” Any potential impacts on such things as economic growth or an increase in tourism would be because of the efforts of businesses or other interests in using the AVA name in promoting the region or the wines and because of consumer acceptance of wines from that area.

With respect to concerns about increased financial burdens for local wine industry members, as noted above, the use of an AVA name on a wine label is completely voluntary. Winemakers who believe it would be costly for them to comply with the 85 percent requirement for use of the AVA name can choose not to use the AVA name and can continue to operate their businesses as usual. Therefore, any additional costs incurred from the use of an AVA name on a wine label would be the result of the decisions of the individual winemaker and not the direct result of the rulemaking.

Finally, when establishing an AVA to allow winemakers to better describe the origins of their wines, TTB is not required to determine the possible effects of this administrative regulatory action on property values or the environment. Furthermore, TTB notes that comment 10, submitted by the Third District Supervisor of the San Bernardino County Board of Supervisors in support of the proposed AVA, acknowledges the importance of protecting water resources in the county and states that vineyards have little impact on the water reserves as they require far less water than other agricultural crops.

After careful review of the petition and comments, TTB finds that the evidence provided by the petitioner supports the establishment of the Yucaipa Valley AVA. Accordingly, under the authority of the FAA Act, section 1111(d) of the Homeland Security Act of 2002, and parts 4 and 9 of the TTB regulations, TTB establishes the “Yucaipa Valley” AVA in San Bernardino County, California, effective 30 days from the publication date of this document.

See the narrative description of the boundary of the Yucaipa Valley AVA in the regulatory text published at the end of this final rule.

The petitioner provided the required maps, and they are listed below in the regulatory text. The Yucaipa Valley AVA boundary may also be viewed on the AVA Map Explorer on the TTB website, at https://www.ttb.gov/wine/ava-map-explorer.

Part 4 of the TTB regulations prohibits any label reference on a wine that indicates or implies an origin other than the wine's true place of origin. For a wine to be labeled with an AVA name or with a brand name that includes an AVA name, at least 85 percent of the wine must be derived from grapes grown within the area represented by that name, and the wine must meet the other conditions listed in 27 CFR 4.25(e)(3). If the wine is not eligible for labeling with an AVA name and that name appears in the brand name, then the label is not in compliance and the bottler must change the brand name and obtain approval of a new label. Similarly, if the AVA name appears in another reference on the label in a misleading manner, the bottler would have to obtain approval of a new label. Different rules apply if a wine has a brand name containing an AVA name that was used as a brand name on a label approved before July 7, 1986. See 27 CFR 4.39(i)(2) for details.

With the establishment of the Yucaipa Valley AVA, its name, “Yucaipa Valley,” will be recognized as a name of viticultural significance under § 4.39(i)(3) of the TTB regulations (27 CFR 4.39(i)(3)). The text of the regulations clarifies this point. Consequently, wine bottlers using the name “Yucaipa Valley” in a brand name, including a trademark, or in another label reference to the origin of the wine, will have to ensure that the product is eligible to use the AVA name as an appellation of origin.

The establishment of the Yucaipa Valley AVA will not affect any existing AVA. The establishment of the Yucaipa Valley AVA will allow vintners to use “Yucaipa Valley” as an appellation of origin for wines made primarily from grapes grown within the Yucaipa Valley AVA if the wines meet the eligibility requirements for the appellation.

TTB certifies that this regulation will not have a significant economic impact on a substantial number of small entities. The regulation imposes no new reporting, recordkeeping, or other administrative requirement. Any benefit derived from the use of an AVA name would be the result of a proprietor's efforts and consumer acceptance of wines from that area. Therefore, no regulatory flexibility analysis is required.

It has been determined that this final rule is not a significant regulatory action as defined by Executive Order 12866 of September 30, 1993, as amended. Therefore, no regulatory assessment is required.

Karen A. Thornton of the Regulations and Rulings Division drafted this final rule.

For the reasons discussed in the preamble, TTB amends title 27, chapter I, part 9, Code of Federal Regulations, as follows:

This final rule amends three sections in 38 CFR parts 38 and 39 to implement statutory requirements enacted in section 6 of Public Law 117-355, the “National Cemeteries Preservation and Protection Act of 2022” (the Act), which amended 38 U.S.C. 2411 to expand the prohibition of memorialization or interment in a cemetery in the National Cemetery Administration (NCA) or Arlington National Cemetery of persons who committed certain crimes. Specifically, the amendment adds a new category of “persons prohibited” in sec. 2411(b)(5) to include a person who is found to have committed a Federal or State crime that would cause the person to be a tier III sex offender for purposes of the Sex Offender Registration and Notification Act (34 U.S.C. 20901 et seq. ) but has not been convicted of such crime because they were not available for trial due to death or flight to avoid prosecution. The Act also amended sec. 2411(b)(4)(B) to bar interment or memorialization of a person convicted of a Federal or State crime causing the person to be a tier III sex offender who for such crime was sentenced to a period of 99 years or more, whereas the statute previously only included individuals sentenced to a minimum of life imprisonment.

To implement the new statutory requirements, VA is amending 38 CFR 38.617, 38.618, and 39.10. These sections include references to the statutory authority to bar eligible individuals who by their criminal acts are prohibited from receiving memorialization benefits and interment in VA national and VA grant-funded cemeteries. Specific amendments to §§ 38.617, 38.618, and 39.10 are as follows.

VA is amending 38 CFR 38.617(a)(4) by inserting the words “or to a period of 99 years or more” after “life imprisonment” and adding new paragraph (a)(5) to implement the new category of persons to be barred under 38 U.S.C. 2411(b)(5). Implementing this change will not affect VA's current adjudication or appeals processes for interment and memorialization requests.

VA is also making a couple of technical corrections in § 38.617. First, VA is revising the section heading from “Prohibition of interment or memorialization of persons who have been convicted of Federal or State capital crimes or certain sex offenses” to “Prohibition of interment or memorialization of persons who committed certain Federal or State crimes” to capture those persons who committed certain Federal or State crimes but avoided conviction due to death or flight to avoid prosecution. Second, VA is amending paragraph (b) to clarify that the prohibition referred to in newly added paragraph (a)(5), which applies to a person found to have committed a Federal or State crime that would cause the person to be a tier III sex offender but avoided conviction due to death or flight to avoid prosecution, is not contingent on receipt by the Secretary of Veterans Affairs or any other VA official of notice from any Federal or State official.

VA is revising § 38.618 by revising the heading to include the words “or certain sex offenses”. Section 38.618 amendments revise paragraphs (a) through (c), (e) and (f) by adding the words “or a Federal or State crime that would cause the person to be a tier III sex offender for purposes of the Sex Offender Registration and Notification Act (34 U.S.C. 20901 et seq. )” to include the new category of prohibited persons. Implementing this additional basis for the statutory bar to apply to interment and memorialization requests will not result in a change to VA's adjudication or appeals processes.

VA is also making a technical correction updating the reference to “VA regional counsel” to “VA district counsel” in § 38.618(a).

Finally, changes in sec. 2411 affect the application of that statute for cemeteries that receive a grant under 38 U.S.C. 2408. Specifically, sec. 2408(e) conditions any grant on the grantee's prohibition of interment or memorialization of a person described in sec. 2411(b). As a result, VA will amend § 39.10(b)(4) by inserting the words “or to a period of 99 years or more” after “life imprisonment,” and VA will add new paragraph (b)(5) to implement the new category of persons to be barred under 38 U.S.C. 2411(b)(5). These amendments implementing new statutory requirements that affect VA grant-funded cemeteries will not affect the cemetery grant process. VA defers to State officials to establish procedures for applying the statutory bar to benefits under sec. 2411(b), in accordance with sec. 2408(e).

The Secretary of Veterans Affairs finds that there is good cause under the provisions of 5 U.S.C. 553(b)(B) to publish this rule without prior opportunity for public comment and dispense with the 30-day delay for the effective date of a rule under 5 U.S.C. 553(d)(3). Pursuant to sec. 553(b)(B) of the Administrative Procedure Act, general notice and opportunity for public comment are not required with respect to a rulemaking when an “agency for good cause finds (and incorporates the finding and a brief statement of reasons therefor in the rules issued) that notice and public procedure thereon are impracticable, unnecessary, or contrary to the public interest.” Pursuant to sec. 553(d)(3), an agency may “for good cause found” dispense with the 30-day delay in the effective date of a rule.

Public comment is unnecessary for this rulemaking because this final rule merely incorporates the statutory text enacted by Congress, which is already in effect, and makes no other changes to existing processes for applying the bar to interment and memorialization requests. See Hadson Gas Sys. v. FERC, 75 F.3d 680, 684-85 (D.C. Cir. 1996) (holding that notice and public comment were not necessary when an agency removed regulations which had been rendered obsolete by statutory changes). For the same reason, VA concludes that there is good cause for the rule to be effective immediately under 5 U.S.C. 553(d)(3).

Executive Orders 12866 (Regulatory Planning and Review) directs agencies to assess the costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 14094 (Modernizing Regulatory Review) supplements and reaffirms the principles, structures, and definitions governing contemporary regulatory review established in Executive Orders 12866 and 13563. The Office of Information and Regulatory Affairs has determined that this rulemaking is not a significant regulatory action under Executive Order 12866, as amended by Executive Order 14094. The Regulatory Impact Analysis associated with this rulemaking can be found as a supporting document at www.regulations.gov.

The Regulatory Flexibility Act, 5 U.S.C. 601-612, is not applicable to this rulemaking because notice of proposed rulemaking is not required. See 5 U.S.C. 601(2), 603(a), 604(a).

The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies, before promulgating any general notice of proposed rulemaking, prepare an assessment of anticipated costs and benefits before issuing any rule that may result in the expenditure by State, local, and Tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This requirement is not applicable to this rulemaking because a general notice of proposed rulemaking is not required. See 2 U.S.C. 1532.

This final rule contains no provisions constituting a collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521).

Pursuant to Subtitle E of the Small Business Regulatory Enforcement Fairness Act of 1996 (known as the Congressional Review Act) (5 U.S.C. 801 et seq. ), the Office of Information and Regulatory Affairs designated this rule as not satisfying the criteria under 5 U.S.C. 804(2).

Denis McDonough, Secretary of Veterans Affairs, approved and signed this document on April 10, 2024, and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs.

For the reasons stated in the preamble, the Department of Veterans Affairs amends 38 CFR parts 38 and 39 as set forth below:

On November 28, 2023, the Postal Service published a notice of proposed rulemaking (88 FR 83056-83062) to require the use of USPS Ship. In response to the proposed rule, the Postal Service received two responses containing multiple comments, as follows:

Comment: One commenter recommended the final rule clarify that USPS Ship will replace only eVS and that all other payment and acceptance channels including Click-N-Ship, ePostage, PC Postage, IBI postage meters, non-eVS (BMEU entered and permit imprint) will be unaffected unless specifically addressed.

Response: All commercial packages will be verified through USPS Ship.

Comment: One commenter recommended the final rule clarify that for purposes of the migration from eVS to USPS Ship, negotiated service agreement (NSA) provisions governing payment and acceptance processes will not be changed, rather USPS Ship will be deemed a successor system to eVS, and that the migration will not otherwise modify preexisting contractual payment and acceptance processes.

Response: In Terms of NSAs, customers are expected to transition to the successor system which is USPS Ship.

Comment: One commenter recommended the final rule clarify any planned changes in the refund and disputes processes to ensure quality control and quality assurance for fee assessment in connection with the migration to USPS Ship.

Response: The Postal Service has the USPS Ship User Guide, which will be available on PostalPro at https://postalpro.usps.com, and mailers should reference the document for all information regarding USPS Ship including questions for refunds and disputes.

Comment: Two commenters expressed concern over the implementation date. One commenter stated they appreciate the need to identify an aggressive target implementation date, in this case February 1, 2025. However, past experiences with comparable payment systems migrations underscore the countervailing importance of setting and measuring incremental progress against intermediate benchmarks. This is especially important for competitive package products offered in a highly competitive marketplace. Another commenter stated that there are concerns that the planned schedule will not allow sufficient time for the Postal Service's systems to stabilize or for shippers to make necessary system changes in response.

Response: While the Postal Service works with the industry toward meeting the target implementation date, we will consider if any extensions to the date are needed.

The Postal Service is requiring the use of USPS Ship for the acceptance and payment of all commercial domestic and international parcel mailings. USPS Ship combines the attributes captured from scan data and manifested attributes to ensure customers are charged accurate postage. For consolidators, if there are adjustments to inaccurate original postage, those individual package costs can be provided to the mail owners.

USPS Ship offers online enrollment, individual package pricing, automated adjustments, online reports, and data feeds via IV-MTR. The automated capture enables individual package attributes to be compared to manifest data to validate accurate postage. Shortpaid (postage due) or overpaid (refunds) will be assessed upon package delivery and applied to the Enterprise Payment Account (EPA) on file.

Requirements to participate in USPS Ship are as follows:

• Customers must enroll in USPS Ship and be assigned a unique Mailer Identifier (MID) for use on packages.

• Customers must submit valid rate ingredients for payment for each package within their shipment.

• Customers must upload manifests to USPS using the Parcel Data Exchange or Electronic Interchange (SFTP or AS2) for payment as noted in eVS Pub 205.

• Customers must pay postage through an Enterprise Payment Account.

• Packages must include a Tracking Number that is unique for 120 days.

• Customers must ship the following products:

○ Domestic Products—Priority Mail Express®, Priority Mail®, USPS Ground Advantage TM (formerly First-Class Package® Service), Bound Printed Matter, Media Mail®, Library Mail, USPS Marketing Mail® parcels, USPS Marking Mail Nonprofit parcels, Parcel Select® Destination Entry, USPS Connect TM Local, USPS Connect Local Mail, and USPS Returns®.

○ International Products—Global Express Guaranteed®, Priority Mail Express International®, Priority Mail International®, and First-Class Package International Service®.

Mailers and shippers who meet program requirements must ship parcels using the following procedure:

1. The mailer/parcel shipper transmits an electronic manifest to the Postal Service detailing all USPS Ship parcels to be deposited into the mailstream on or before the date of mailing.

2. USPS Ship will validate the electronic manifest and calculate postage based on rate ingredients.

3. Postage is charged to the EPA on the day that the manifest was submitted and processed. Transactions and manifest summary information can be accessed through the online reports or data feeds.

4. The mailer/parcel shipper transports and enters the mail at the appropriate origin or destination entry (NDC/RP&DC, SCF/RP&DC, DHub, DDU or S&DC) Postal Service facility.

5. As parcels are deposited at the origin entry facilities, packages are run across Mail Processing Equipment (MPE) and captured attributes (weight, dimensions, entry, packaging) are transmitted to USPS Ship. The captured attributes are compared to manifested attributes to ensure the correct postage has been paid. If there are discrepancies, shortpaid/overpaid will be applied to the EPA.

6. As parcels are deposited at the DDU or DS&DC facilities, packages are sampled, and the sampled attributes are compared to the manifested attributes. A Statistical Quality Assessment is performed, and additional postage will be charged to the EPA.

7. Assessment details can be accessed through the online reports or data feeds.

USPS Ship will collect postage daily based on the electronic manifest(s) received that day from mailers. In addition, postage will be calculated and assessed for the following types of errors when detected:

• Census Verification occurs for packages that are automatically captured while packages are processed on MPE. The individual package information captured may include the weight, dimensions, USPS packaging, ZIP Code of scan, and destination ZIP Code. The captured information will be compared to the manifest information after the delivery scan for the package. The correct postage will be assessed, additional postage will be charged or refunded to reflect the accurate postage for the individual packages.

○ Misshipped is include in the Census Verification. The manifest is matched to a scan and the Destination ZIP Code and Destination Rate Indicator of the is compared to the Mail Direction File (MDF) to determine the correct Dropship location. The ZIP Code of the first scan event is compared to the expected Dropship location indicated in the MDF. If the ZIP Code of the first scan event does not match the expected Dropship location, then a Misshipped error is logged, and additional postage will be charged.

• Unmanifested packages are identified by scanned packages without a manifest for payment in USPS Ship.

• Duplicate packages are identified by scanned packages with duplicate barcodes without a payment for each package in USPS Ship.

• IMpb noncompliance is measured using the same evaluation and established thresholds for the month period as previously required by eVS.

• Presort is measured by the 24-hour period to meet presort minimums by mail class as previously required by eVS.

• Statistical Quality Assessment (SQA) occurs for Parcel Select, Bound Printed Matter, USPS Marketing Mail packages that are entered and claimed at Destination Delivery Unit (DDU) prices. This verification is similar to the Postage Adjustment Factor (PAF), but is limited to DDU or DS&DC entered packages. If the postage for the packages that are sampled at a DDU or DS&DC compared to the manifested data, exceeds 1.5% underpayment, the percentage in error will be multiplied by the total postage for the mail class for the month and this calculated additional postage charge will be assessed. Only packages that are prompted for sampling will be part of this verification, any non- prompted samples will be part of the Census Verification.

• Content Audit is measured using the same business rules as previously required by eVS.

Commercial shippers entering at a Business Mail Entry Unit (BMEU) with small quantities may use Click-N-Ship or USPS Ship to enter their parcels. Otherwise, payment applies as follows:

• Parcel shippers/consolidators and mailers using permit imprint as the payment method and claiming Commercial or NSA prices that are not using Click-N-Ship are required to use USPS Ship for postage manifesting and payment.

• Parcel shippers/consolidators and mailers who use USPS APIs to create labels and submit their manifest files are also required to enroll in USPS Ship.

• Daily—Postage for manifest files is charged the day of the manifest receipt/processing. The census verification is charged/refunded the day of delivery.

• Monthly—Unmanifested, duplicates, IMpb, presort, content audit and SQA are assessed monthly and charged on the 15th of the following month.

USPS Ship enables customers to view manifest and assessment data by accessing online reports or subscribing to IV-MTR data feeds.

• Accessing Online Reports —The Online Dashboard provides summary details for manifests that were charged and package level details for postage adjustments. Customers should complete the following to access the USPS Ship Reports:

• Subscribing to IV-MTR Data Feeds—IV-MTR allows customer to customize to select and organize fields to be included, chose frequency, choose file format, and choose delivery location. Customers should complete the following to setup IV-MTR subscriptions:

Due to the ability to automatically capture package attributes, and the new system infrastructure, the Postal Service will discontinue eVS.

We believe the proposed revisions will provide customers with a more efficient mailing experience.

The Postal Service adopts the described changes to Mailing Standards of the United States Postal Service, Domestic Mail Manual (DMM), incorporated by reference in the Code of Federal Regulations.

We will publish an appropriate amendment to 39 CFR part 111 to reflect these changes.

Accordingly, 39 CFR part 111 is amended as follows:

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

On August 17, 2022 (87 FR 50594), EPA proposed to approve Indiana's opacity rule section 326 Indiana Administrative Code (IAC) 5-1-8, effective December 8, 2021, as a revision to the Indiana SIP. The rule revision provides BP's two fluidized catalytic cracking units (FCUs), FCU 500 and FCU 600, with a temporary alternative opacity limitation to address safety hazards during startup, shutdown, and hot standby.

As noted in EPA's proposal, the temporary alternative opacity limitation provided to BP in 326 IAC 5-1-8 is consistent with applicable requirements in 326 IAC 5-1-3, approved by EPA on July 16, 2002 (67 FR 46589). This revision applies only to opacity rules at 326 IAC 5-1-8 as allowed under 326 IAC 5-1-3. Emission limitations and monitoring for all other pollutants, including particulate matter, remain unchanged.

The temporary alternative opacity limit is also consistent with the requirements of 40 CFR part 63, subpart UUU, the National Emission Standards for Hazardous Air Pollutants (NESHAP) for Petroleum Refineries: Catalytic Cracking Units, Catalytic Reforming Units, and Sulfur Recovery Units. The NESHAP allows units to demonstrate compliance during periods of startup, shutdown, or hot standby by maintaining the inlet velocity to the primary internal cyclones of the FCU catalyst regenerator at or above 20 feet per second. 326 IAC 5-1-8(c) requires BP to follow the same requirement as the NESHAP for FCU 500 and FCU 600, including the operating, data collection, and recordkeeping requirements. 326 IAC 5-1-8 (c)(3)(G) also requires BP to minimize emissions consistent with the NESHAP.

The public comment period for this proposed rule ended on September 16, 2022. EPA received no comments. EPA is finalizing this action as proposed.

EPA is approving Indiana's opacity rule section 326 IAC 5-1-8 as a revision to the Indiana SIP.

In this rule, EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, EPA is finalizing the incorporation by reference of the Indiana Regulations described in Section I of this preamble and set forth in the amendments to 40 CFR part 52 below. EPA has made, and will continue to make, these documents generally available through www.regulations.gov, and at the EPA Region 5 Office (please contact the person identified in the FOR FURTHER INFORMATION CONTACT section of this preamble for more information). Therefore, these materials have been approved by EPA for inclusion in the SIP, have been incorporated by reference by EPA into that plan, are fully federally enforceable under sections 110 and 113 of the CAA as of the effective date of the final rulemaking of EPA's approval, and will be incorporated by reference in the next update to the SIP compilation. 1

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

• Is not a significant regulatory action subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993), and 14094 (88 FR 21879, April 11, 2023);

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

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

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

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

• Is not subject to Executive Order 13045 (62 FR 19885, April 23, 1997) because it approves a state program;

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

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

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

Executive Order 12898 (Federal Actions To Address Environmental Justice in Minority Populations and Low-Income Populations, 59 FR 7629, February 16, 1994) directs Federal agencies to identify and address “disproportionately high and adverse human health or environmental effects” of their actions on minority populations and low-income populations to the greatest extent practicable and permitted by law. EPA defines environmental justice (EJ) as “the fair treatment and meaningful involvement of all people regardless of race, color, national origin, or income with respect to the development, implementation, and enforcement of environmental laws, regulations, and policies.” EPA further defines the term fair treatment to mean that “no group of people should bear a disproportionate burden of environmental harms and risks, including those resulting from the negative environmental consequences of industrial, governmental, and commercial operations or programs and policies.”

Indiana did not evaluate environmental justice considerations as part of its SIP submission; the CAA and applicable implementing regulations neither prohibit nor require such an evaluation. EPA did not perform an EJ analysis and did not consider EJ in this action.

This action is subject to the Congressional Review Act, and EPA will submit a rule report to each House of the Congress and to the Comptroller General of the United States. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by June 24, 2024. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

For the reasons stated in the preamble, title 40 CFR part 52 is amended as follows:

The Supplementary Information section is arranged as follows:

On February 20, 2024 (89 FR 12796), the EPA published a Notice of Proposed Rulemaking (NPRM) that proposed approving the New Jersey Department of Environmental Protection (NJDEP) request, dated May 8, 2023, for delegation of authority of the Federal Plan Requirements for Municipal Solid Waste (MSW) Landfills That Commenced Construction On or Before July 17, 2014, and Have Not Been Modified or Reconstructed Since July 17, 2014, (Federal Plan), codified at 40 CFR part 62, subpart OOO, for existing sources of MSW Landfills. New Jersey's request letter included a commitment to enter a memorandum of agreement (MoA) developed by the NJDEP and the EPA, which defines the policies, responsibilities, and procedures that the NJDEP and the EPA will conform to in administering the Federal Plan requirements. The MoA was signed by the NJDEP Assistant Commissioner on November 21, 2023, and the EPA Region 2 Regional Administrator on November 28, 2023. The NPRM informed the public of the MoA, provided a copy of the signed document, and proposed amending associated regulatory text at 40 CFR part 62, subpart FF—New Jersey to promulgate the approved delegation of authority to the NJDEP for implementing and enforcing the Federal Plan Requirements for Municipal Solid Waste Landfills That Commenced Construction On or Before July 17, 2014 and Have Not Been Modified or Reconstructed Since July 17, 2014 at 40 CFR part 62, subpart OOO.

The EPA will continue to retain enforcement authority along with the NJDEP, and the EPA will continue to retain certain specific authorities reserved for the EPA in the Federal Plans and as indicated in the MoA ( e.g., authority to approve major alternatives to test methods or monitoring, authority to approve alternative methods to determine the site-specific NMOC concentration or a site-specific methane generation rate constant, etc).

On February 20, 2024 (89 FR 12796), the EPA proposed to approve the NJDEP's request for delegation of the MSW landfill Federal Plan. For a detailed discussion on the content and requirements of the NJDEP's delegation request, the reader is referred to the EPA's proposed rulemaking action. The EPA received no public comments in response to its February 20, 2024, NPRM.

The EPA approves amending regulatory text at 40 CFR part 62, subpart FF—New Jersey, to promulgate the delegation of authority to the NJDEP for implementing and enforcing the Federal Plan Requirements for Municipal Solid Waste Landfills That Commenced Construction On or Before July 17, 2014, and Have Not Been Modified or Reconstructed Since July 17, 2014, at 40 CFR part 62, subpart OOO.

Under the CAA, the Administrator has the authority to delegate the authority to implement a 111(d)/129 Federal Plan that complies with the provisions of the CAA and applicable Federal regulations. See 40 CFR 60.27. In reviewing 111(d)/129 Federal Plan delegation requests, the EPA's role is to approve State choices, provided that they meet the criteria of the CAA and of the EPA's implementing regulations. Accordingly, this action merely codifies in the Code of Federal Regulations the EPA's delegation of authority to implement the Federal Plan and does not impose additional requirements beyond those imposed by the already-applicable Federal Plan. For that reason, this action:

• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Order 12866 (58 FR 51735, October 4, 1993), and 14094 (88 FR 21879, April 11, 2023);

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

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

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

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

• Is not subject to Executive Order 13045 (62 FR 19885, April 23, 1997) because it approves a State program;

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

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

In addition, this rulemaking action, pertaining to New Jersey's section 111(d) request for delegation of authority to implement and enforce the Federal Plan for existing MSW landfills, is not approved to apply on any Indian reservation land or in any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and it will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).

Executive Order 12898 (Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations, 59 FR 7629, Feb. 16, 1994) directs Federal agencies to identify and address “disproportionately high and adverse human health or environmental effects” of their actions on minority populations and low-income populations to the greatest extent practicable and permitted by law. The EPA defines environmental justice (EJ) as “the fair treatment and meaningful involvement of all people regardless of race, color, national origin, or income with respect to the development, implementation, and enforcement of environmental laws, regulations, and policies.” The EPA further defines the term fair treatment to mean that “no group of people should bear a disproportionate burden of environmental harms and risks, including those resulting from the negative environmental consequences of industrial, governmental, and commercial operations or programs and policies.”

The NJDEP did not evaluate EJ considerations as part of its formal request; the CAA and applicable implementing regulations neither prohibit nor require such an evaluation. The EPA did not perform an EJ analysis and did not consider EJ in this action. Due to the nature of the action being taken here, this action is expected to have a neutral to positive impact on the air quality of the affected area. Consideration of EJ is not required as part of this action, and there is no information in the record inconsistent with the stated goal of E.O. 12898 of achieving environmental justice for people of color, low-income populations, and Indigenous peoples.

This action is subject to the Congressional Review Act, and the EPA will submit a rule report to each House of the Congress and the Comptroller General of the United States. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by June 24, 2024. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2)).

For the reasons set forth in the preamble, 40 CFR part 62 is amended as follows:

I. General Information A. Does this action apply to me?

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

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

You may access a frequently updated electronic version of 40 CFR part 174 through the Office of the Federal Register's e-CFR site at https://www.ecfr.gov/current/title-40.

Under FFDCA section 408(g), 21 U.S.C. 346a(g), any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2024-0052 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing and must be received by the Hearing Clerk on or before June 24, 2024. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2024-0052, by one of the following methods:

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

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

• Hand Delivery: To make special arrangements for hand delivery or delivery of boxed information, please follow the instructions at https://www.epa.gov/dockets/where-send-comments-epa-dockets. Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at https://www.epa.gov/dockets.

In the Federal Register of February 29, 2024 (89 FR 14795) (FRL-11682-01-OCSPP), EPA issued notice pursuant to FFDCA section 408(d)(3), 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide tolerance petition (3F9098) by J.R. Simplot Company, 5369 W. Irving Street, Boise, ID 83706. The petition requested that 40 CFR part 174 be amended to extend a temporary exemption from the requirement of a tolerance for plant-incorporated protectants BLB2 and AMR3 proteins in potato from March 31, 2024, to March 31, 2025. That document referenced a summary of the petition prepared by the petitioner J.R. Simplot Company, which is available in the docket via https://www.regulations.gov. There were no comments received in response to the Notice of Filing.

Section 408(r) of FFDCA authorizes EPA to establish a temporary exemption from the requirement of a tolerance for residues covered by an experimental use permit issued under the Federal Insecticide, Fungicide, and Rodenticide Act. That section states that the provisions of section 408(c)(2) of FFDCA apply to exemptions issued under FFDCA section 408(r). Section 408(c)(2)(A)(i) of FFDCA allows EPA to establish an exemption from the requirement for a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the exemption is “safe.” Section 408(c)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings but does not include occupational exposure. Pursuant to FFDCA section 408(c)(2)(B), in establishing or maintaining in effect an exemption from the requirement of a tolerance, EPA must take into account the factors set forth in FFDCA section 408(b)(2)(C), which require EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance or tolerance exemption and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue . . . .” Additionally, FFDCA section 408(b)(2)(D) requires that EPA consider, among other factors, “available information concerning the cumulative effects of [a particular pesticide's] . . . residues and other substances that have a common mechanism of toxicity.”

EPA evaluated the available toxicity and exposure data on BLB2 and AMR3 proteins and considered its validity, completeness, and reliability, as well as the relationship of this information to human risk. In summary, the available data does not indicate any adverse effects due to toxicity or allergenicity of the BLB2 and AMR3 proteins. A full summary of the data upon which EPA relied and its risk assessments based on that data can be found within the document entitled “Review of the Application for an Experimental Use Permit for Gen 3 Potatoes expressing transgenic R-proteins BLB2, AMR3 and VNT1, PVY Coat Protein Hairpin RNA and inert ingredient StmALS and associated FFDCA Petitions for the Temporary Exemption from a Tolerance for AMR3 and BLB2, as well as FFDCA Petition for the Exemption from a Tolerance for StmALS” (Human Health Risk Assessment). This document, which was prepared in support of the original temporary exemption from the requirement of a tolerance for residues of the BLB2 and AMR3 proteins in potato, continues to support this amendment and extension of the tolerance exemption. The Human Health Risk Assessment, as well as other relevant information, is available in the docket for this action as described under ADDRESSES .

Available data have demonstrated that, with regard to humans, BLB2 and AMR3 proteins are not anticipated to be toxic or allergenic via any reasonably foreseeable route of exposure. The plant-incorporated protectant (PIP) active ingredients are resistance (“R”) proteins that confer protection against potato pathogens by directly or indirectly recognizing pathogen-secreted effector proteins. This recognition leads to the activation of the hypersensitive response, which is a form of programmed cell death characterized by cytoplasmic shrinkage, chromatin condensation, mitochondrial swelling, vacuolization and chloroplast disruption. This hypersensitive response pathway involves immune signaling triggered by R proteins that is specific to plants; activated R-proteins cannot trigger cell death in mammals. Thus, BLB2 and AMR3 proteins do not have a toxic mechanism of action, but instead activate signaling cascades within the plant which invoke the plant cell death pathway to prevent growth and spread of the pathogen.

There is likely to be dietary exposure to BLB2 and AMR3 through consumption of potato-derived foods containing the proteins. However, the Agency has concluded that any potential dietary risk from the use of BLB2 and AMR3 proteins to human health is considered negligible for the following reasons. (1) As described above, the mode-of-action of BLB2 and AMR3 is specific to plants and does not affect mammalian cells. (2) Both the BLB2 and AMR3 proteins are expressed at extremely low levels in potato, which indicates very low human exposure to the proteins through the consumption of BLB2- and AMR3-expressing potatoes. (3) Bioinformatics analyses of BLB2 and AMR3 proteins revealed no homology with known toxins or allergens. (4) The source organisms for the active ingredients, Solanum bulbocastanum (BLB2) and Solanum americanum (AMR3), are not known as allergens. (5) Both proteins have a history of safe use. BLB2 originates from S. bulbocastanum (ornamental nightshade), a close potato relative that has 82% sequency similarity with the tomato gene Mi-1, which has a history of safe use since tomatoes have been consumed by humans for hundreds of years. Furthermore, the BLB2 protein is present in two Solanum tuberosum potato varieties (Toluca and Bionica) that have been conventionally bred and cultivated for food use in Europe. AMR3 originates from S. americanum (American black nightshade) which is cultivated for medicinal and food use, and as part of breeding programs for improved nutrition. Although some members of the Solanum genus have toxicity, these effects are caused by glycoalkaloids, which can cause toxicity even in the common potato, Solanum tuberosum. Neither BLB2 nor AMR3 are glycoalkaloids; instead, they belong to a large family of R-proteins found throughout the plant kingdom. There are hundreds to thousands of R-proteins in S. tuberosum and other crops which have a long history of safe consumption.

Oral exposure from ingestion of drinking water is unlikely because BLB2 and AMR3 proteins are present at very low levels within the plant cells. If AMR3 and BLB2 do enter the water column, they are expected to degrade rapidly in the presence of soil microbes, or upon normal communal water-treatment procedures. In addition, there is unlikely to be residential or non-occupational exposure given that the active ingredients are plant-incorporated protectants in potato. Therefore, the only possible route of non-occupational exposure, other than dietary, is via handling of the plants and plant products. However, BLB2 and AMR3 proteins are present in the transformed potato tissues at levels below the level of detection, resulting in minimal to negligible exposure. Furthermore, there are no risks associated with these exposure routes because bioinformatics analysis and the history of safe use have shown that the proteins are not toxic or allergenic.

Although FFDCA section 408(b)(2)(C) provides for an additional tenfold margin of safety for infants and children in the case of threshold effects, EPA has determined that there are no such effects due to the lack of toxicity and allergenicity for these PIP active ingredients. As a result, an additional margin of safety for the protection of infants and children is unnecessary.

Based upon its evaluation, EPA concludes that there is reasonable certainty that no harm will result to the U.S. population, including infants and children, from aggregate exposure to residues of the BLB2 and AMR3 proteins in potatoes. This includes all anticipated dietary exposures and all other exposures for which there is reliable information. The Agency has arrived at this conclusion based on the mode-of-action, history of safe use, and lack of toxicity and allergenicity for the BLB2 and AMR3 proteins in potato.

EPA has determined that an analytical method is not required for enforcement purposes since the Agency is establishing a temporary exemption from the requirement of a tolerance without any numerical limitation. Nonetheless, the petitioner submitted a reverse transcription-quantitative polymerase chain reaction (RT-qPCR) method for detection of BLB2 and AMR3 in transformed leaves and tubers.

Based upon its evaluation in the Human Health Risk Assessment, EPA concludes that there is a reasonable certainty that no harm will result to the U.S. population, including infants and children, from aggregate exposure to residues of BLB2 and ARM3 proteins in potatoes. Therefore, the expiration date for the temporary exemption from the requirement of a tolerance for residues of BLB2 and AMR3 proteins in potato, when used as a plant-incorporated protectant in accordance with the terms of Experimental Use Permit No. 8971-EUP-3, is extended from March 31, 2024, to March 31, 2025.

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

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

This action directly regulates growers, food processors, food handlers, and food retailers, not States or Tribes. As a result, this action does not alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of FFDCA section 408(n)(4). As such, EPA has determined that this action will not have a substantial direct effect on States or Tribal governments, on the relationship between the National Government and the States or Tribal governments, or on the distribution of power and responsibilities among the various levels of government or between the Federal Government and Indian tribes. Thus, EPA has determined that Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999), and Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 9, 2000), do not apply to this action. In addition, this action does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act (UMRA) (2 U.S.C. 1501 et seq. ).

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

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

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

I. General Information A. Does this action apply to me?

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

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

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

Under FFDCA section 408(g), 21 U.S.C. 346a(g), any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2021-0681 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing and must be received by the Hearing Clerk on or before June 24, 2024. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2021-0681, by one of the following methods:

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

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

• Hand Delivery: To make special arrangements for hand delivery or delivery of boxed information, please follow the instructions at https://www.epa.gov/dockets/where-send-comments-epa-dockets#express.

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

In the Federal Register of October 21, 2021 (86 FR 58239) (FRL-8793-04-OCSPP), EPA issued a document pursuant to FFDCA section 408, 21 U.S.C. 346a, announcing the filing of a pesticide petition (PP IN-11585) by AgroSpheres, Inc., 1180 Seminole Trail, Charlottesville, VA, USA, 22901. The petition requested that 40 CFR be amended by establishing an exemption from the requirement of a tolerance for residues of E. coli K-12 derived micelles, when used as an inert ingredient (encapsulation of active ingredient) in pesticide formulations applied to growing crops or raw agricultural commodities pre- and post-harvest under 40 CFR 180.910. That document referenced a summary of the petition prepared by AgroSpheres, Inc., 1180 Seminole Trail, Charlottesville, VA, USA, 22901, the petitioner, which is available in the docket, https://www.regulations.gov. There were no comments received in response to the notice of filing.

Inert ingredients are all ingredients that are not active ingredients as defined in 40 CFR 153.125 and include, but are not limited to, the following types of ingredients (except when they have a pesticidal efficacy of their own): Solvents such as alcohols and hydrocarbons; surfactants such as polyoxyethylene polymers and fatty acids; carriers such as clay and diatomaceous earth; thickeners such as carrageenan and modified cellulose; wetting, spreading, and dispersing agents; propellants in aerosol dispensers; microencapsulating agents; and emulsifiers. The term “inert” is not intended to imply nontoxicity; the ingredient may or may not be chemically active. Generally, EPA has exempted inert ingredients from the requirement of a tolerance based on the low toxicity of the individual inert ingredients.

Section 408(c)(2)(A)(i) of FFDCA allows EPA to establish an exemption from the requirement for a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(c)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings but does not include occupational exposure. When making a safety determination for an exemption for the requirement of a tolerance FFDCA section 408(c)(2)(B) directs EPA to consider the considerations in section 408(b)(2)(C) and (D). Section 408(b)(2)(C) of FFDCA requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue . . .” Section 408(b)(2)(D) lists other factors for EPA consideration making safety determinations, e.g., the validity, completeness, and reliability of available data, nature of toxic effects, available information concerning the cumulative effects of the pesticide chemical and other substances with a common mechanism of toxicity, and available information concerning aggregate exposure levels to the pesticide chemical and other related substances, among others.

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

Consistent with FFDCA section 408(c)(2)(A), and the factors specified in FFDCA section 408(c)(2)(B), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure for E. coli K-12 derived micelles including exposure resulting from the exemption established by this action. EPA's assessment of exposures and risks associated with E. coli K-12 derived micelles follows.

EPA has evaluated the available toxicity data and considered their validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. Specific information on the studies received and the nature of the adverse effects caused by E. coli K-12 derived micelles as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies are discussed in this unit.

The available toxicity studies show that E. coli K-12 derived micelles have a low overall acute toxicity via the oral and inhalation route. Furthermore, E. coli K-12 derived micelles are obtained from bacteria (E. coli K-12) that are nontoxigenic and nonpathogenic. E. coli K-12 derived micelles are also non-viable, further reducing the likelihood of infectivity or pathogenicity to negligible levels. Repeated exposures to high concentrations of microbial proteins may cause allergic sensitization, but this scenario is not anticipated in residential settings.

Once a pesticide's toxicological profile is determined, EPA identifies toxicological points of departure (POD) and levels of concern to use in evaluating the risk posed by human exposure to the pesticide. For hazards that have a threshold below which there is no appreciable risk, the toxicological POD is used as the basis for derivation of reference values for risk assessment. PODs are developed based on a careful analysis of the doses in each toxicological study to determine the dose at which no adverse effects are observed (the NOAEL) and the lowest dose at which adverse effects of concern are identified (the LOAEL). Uncertainty/safety factors are used in conjunction with the POD to calculate a safe exposure level—generally referred to as a population-adjusted dose (PAD) or a reference dose (RfD)—and a safe margin of exposure (MOE). For non-threshold risks, the Agency assumes that any amount of exposure will lead to some degree of risk. Thus, the Agency estimates risk in terms of the probability of an occurrence of the adverse effect expected in a lifetime. For more information on the general principles EPA uses in risk characterization and a complete description of the risk assessment process, see https://www.epa.gov/pesticide-science-and-assessing-pesticide-risks/overview-risk-assessment-pesticide-program.

The hazard profile of E. coli K-12 derived micelles is adequately defined. Overall, E. coli K-12 derived micelles have low toxicity and are nontoxigenic and non-pathogenic. This conclusion is predicated on the manufacturing process ensuring the absence of human pathogenic bacteria in the inert ingredient product. Taking into consideration all available information, no toxicological endpoints were identified, and a quantitative risk assessment is not needed.

1. Dietary exposure from food and feed uses. In evaluating dietary exposure to E. coli K-12 derived micelles, EPA considered exposure under the proposed exemption from the requirement of a tolerance. EPA assessed dietary exposures from E. coli K-12 derived micelles in food as follows:

Dietary exposure (food and drinking water) to E. coli K-12 derived micelles may occur from eating foods treated with pesticide formulations containing this inert ingredient and drinking water containing runoff from soils containing the treated crops. However, no toxicological endpoints of concern were selected, and therefore, a quantitative dietary exposure assessment for E. coli K-12 derived micelles was not conducted.

2. From non-dietary exposure. The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure ( e.g., textiles (clothing and diapers), carpets, swimming pools, and hard surface disinfection on walls, floors, tables).

E. coli K-12 derived micelles may be present in pesticide and non-pesticide products that may be used in and around the home. However, a quantitative residential exposure assessment was not conducted since a toxicological endpoint for risk assessment was not identified.

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

Based on the lack of toxicity in the available database, EPA has not found E. coli K-12 derived micelles to share a common mechanism of toxicity with any other substances, and E. coli K-12 derived micelles do not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance exemption, therefore, EPA has not found E. coli K-12 derived micelles to share a common mechanism of toxicity with any other substances, and E. coli K-12 derived micelles do not appear to produce a toxic metabolite produced by other substances. Therefore, for the purposes of this tolerance exemption, EPA has not assumed that E. coli K-12 derived micelles have a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see the policy statements released by OPP concerning common mechanism determinations and procedures for cumulating effects from substances found to have a common mechanism on EPA's website. ( https://www.epa.gov/pesticide-science-and-assessing-pesticide-risks/cumulative-assessment-risk-pesticides ).

Section 408(b)(2)(C) of FFDCA provides that EPA shall apply an additional tenfold (10X) margin of safety for infants and children in the case of threshold effects to account for prenatal and postnatal toxicity and the completeness of the database on toxicity and exposure unless EPA determines based on reliable data that a different margin of safety will be safe for infants and children. This additional margin of safety is commonly referred to as the Food Quality Protection Act (FQPA) Safety Factor (SF). In applying this provision, EPA either retains the default value of 10X, or uses a different additional safety factor when reliable data available to EPA support the choice of a different factor.

Based on an assessment of E. coli K-12 derived micelles, EPA has concluded that there are no toxicological endpoints of concern for the U.S. population, including infants and children. Because there are no threshold effects associated with E. coli K-12 derived micelles, EPA conducted a qualitative assessment. As part of that assessment, the Agency did not use safety factors for assessing risk, and no additional safety factor is needed for assessing risk to infants and children.

Because no toxicological endpoints of concern were identified, EPA concludes that there is a reasonable certainty that no harm will result to the general population, or to infants and children from aggregate exposure to E. coli K-12 derived micelle residues.

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

Therefore, an exemption from the requirement of a tolerance is established for residues of Escherichia coli strain K-12 P678-54 micelles (also known as E. coli K-12 derived micelles) (No CAS Reg. No.) when used as an inert ingredient (encapsulation of active ingredient) in pesticide formulations applied to growing crops and raw agricultural commodities after harvest under 40 CFR 180.910.

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

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

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

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

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

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

EPA is correcting the final rule that published in the Federal Register of Thursday, March 28, 2024 (89 FR 21970); FRL-8332-01-OCSPP) to address an inadvertent error made while numbering the paragraphs in § 751.515(c)(1).

In FR Doc. 2024-05972, appearing on page 21970 in the Federal Register of Thursday, March 28, 2024, the following correction is made:

DoD published a proposed rule in the Federal Register at 88 FR 67611 on September 29, 2023, to implement section 808 of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2023 (Pub. L. 117-263). Section 808 amends section 818 of Public Law 109-364 to limit the number of low-rate initial production lots associated with a major defense acquisition program to be procured to no more than one when the milestone decision authority authorizes the use of a fixed-price type contract at Milestone B and the scope of the work includes both development and low-rate initial production. This limitation may be waived. Two respondents submitted public comments in response to the proposed rule.

DoD reviewed the public comments in the development of the final rule. A discussion of the comments is provided, as follows:

There are no significant changes from the proposed rule.

Comment: One respondent indicted support for the rule.

Response: The support for the rule is noted.

Comment: One respondent suggested that the rule should define or provide a reference to the definition of a fixed-price contract. The rule does not specify whether fixed-price contracts include firm-fixed-price, fixed-price-incentive, or fixed-price-with-economic-price-adjustment, which could create ambiguity or inconsistency in the application of the rule and affect the level of risk and incentive for the Government and contractors. The respondent recommended providing a reference to the relevant section of the Federal Acquisition Regulation (FAR) that defines these types of contracts or specify the types of fixed-price contracts that can be used.

Response: This rule does not stand alone; contracting officers will implement the rule in the context provided by the FAR and DFARS. FAR subpart 16.2 describes the types of fixed-price contracts that a contracting officer may use. The DFARS, as a supplement to the FAR, does not duplicate the content of the FAR.

Comment: One respondent suggested that the rule should explain the rationale or purpose of the limitation on procuring more than one lot for low-rate initial production (LRIP) using a fixed-price type contract for a major defense acquisition program. The rule currently does not state why this limitation is necessary or beneficial, or how it relates to the objective of reducing cost risk and improving performance. This could make it difficult to evaluate the effectiveness or impact of the rule, or to justify its use in specific cases.

Response: Section 808 of the NDAA for FY 2023 limits the number of LRIP lots to no more than one on fixed-price contracts that also include development. Neither section 808 nor the Joint Explanatory Statement provides the rationale or purpose of the limitation. However, the limitation may result in a reduction in risk to the contractor associated with proposing prices for multiple production lots of an item prior to the completion of development and initial production of the item.

Comment: One respondent suggested that the rule should establish some criteria or guidelines for exercising the waiver authority for the limitation on LRIP procurement. The rule currently does not indicate how the service acquisition executive should decide whether to grant or deny a waiver, or what factors should be considered in making this decision. This could lead to arbitrary or inconsistent decisions or undermine the accountability or transparency of the waiver process. Providing examples of factors that could justify a waiver and indicate that the waiver authority should be used sparingly and only in exceptional circumstances.

Response: Section 808 provides the service acquisition executive the authority to waive this limitation. It does not specify the criteria to be considered in making such a waiver decision. Providing examples of factors to consider in determining whether or not to waive the limitation may preclude the consideration of factors that are relevant to the instant acquisition and may have a negative impact on meeting mission needs.

This final rule does not create any new solicitation provisions or contract clauses. It does not impact any existing solicitation provisions or contract clauses or their applicability to contracts valued at or below the simplified acquisition threshold, for commercial products including COTS items, or for commercial services.

As a result of this final rule, unless waived, the Government may not procure more than one low-rate initial production lot associated with a major defense acquisition program if, at the time of Milestone B approval, the milestone decision authority authorizes the use of a fixed-price type contract and the scope of work of the fixed-price contract includes both development and low-rate initial production of items associated with such major defense acquisition program. This rule does not impact contractor operations; however, it may limit contractor risk assumed under such contracts. Development and initial production of an item likely involve the discovery and resolution of problems that are unknown beforehand. Risk to a contractor is higher when the contractor must propose prices for multiple production lots of an item before the development and initial production of that item are complete. By limiting the number of low-rate initial production lots on a fixed-price contract that also includes development, this risk to the contractor may be reduced.

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. This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, as amended.

As required by the Congressional Review Act (5 U.S.C. 801-808) before an interim or final rule takes effect, DoD will submit a copy of the interim or final rule with the form, Submission of Federal Rules under the Congressional Review Act, to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States. A major rule under the Congressional Review Act cannot take effect until 60 days after it is published in the Federal Register . The Office of Information and Regulatory Affairs has determined that this rule is not a major rule as defined by 5 U.S.C. 804.

A final regulatory flexibility analysis has been prepared consistent with the Regulatory Flexibility Act, 5 U.S.C. 601, et seq. and is summarized as follows:

This final rule is necessary to implement section 808 of the National Defense Authorization Act for Fiscal Year (FY) 2023 (Pub. L. 117-263). Section 808 modifies section 818 of Public Law 109-364 to limit the number of low-rate initial production lots associated with a major defense acquisition program to be procured to no more than one when the milestone decision authority authorizes the use of a fixed-price type contract at the time of Milestone B approval and the scope of the fixed-price contract includes both development and low-rate initial production.

No comments were received in response to the initial regulatory flexibility analysis.

Data is not available on the number of fixed-price type contracts for major defense acquisition programs that contain both development and low-rate initial production; therefore, data was obtained for contracts that include DFARS clause 252.234-7004, Cost and Software Data Reporting System, or its alternate I clause. This DFARS clause is required to be included in solicitations and contracts for major defense acquisition programs that exceed $50 million, and its alternate I clause is required to be included in solicitations and contracts for major defense acquisition programs that are greater than $20 million but less than or equal to $50 million under certain circumstances. According to the Procurement Business Intelligence Service, DoD awarded contracts for major defense acquisition programs to 130 unique small entities in FY 2021, 99 in FY 2022, and 109 in FY 2023. The average over the three-year period is 112 per fiscal year. Therefore, the number of small entities to which this rule may apply is 112.

This final rule does not impose any new reporting, recordkeeping, or other compliance requirements for small entities.

There are no known alternatives that would accomplish the stated objectives of the applicable statute.

This final 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, 48 CFR parts 207 and 234 are amended as follows:

In the FR Doc. 2023-27953, starting on page 4201 in the Federal Register of January 23, 2024, USAID is making the following corrections: