Under the Horse Protection Act (HPA, or the Act, 15 U.S.C. 1821 et seq. ), the Secretary of Agriculture is authorized to promulgate regulations to prohibit the movement, showing, exhibition, or sale of sore horses. The Secretary has delegated responsibility for administering the Act to the Administrator of the U.S. Department of Agriculture's (USDA) Animal and Plant Health Inspection Service (APHIS). Within APHIS, the responsibility for administering the Act has been delegated to the Deputy Administrator for Animal Care. Regulations and standards established under the Act are contained in 9 CFR part 11 (referred to below as the Horse Protection regulations or just the regulations), and 9 CFR part 12 lists the rules of practice governing administrative proceedings.

On May 8, 2024, APHIS published in the Federal Register (89 FR 39194-39251, APHIS-2022-0004), 1 a final rule titled “Horse Protection Amendments” (2024 Horse Protection final rule) that was to be effective on February 1, 2025, except for § 11.19, which had an effective date of June 7, 2024.

On January 28, 2025, APHIS published in the Federal Register (90 FR 8253-8254, APHIS-2022-0004), 2 a postponement of the regulations in the 2024 Horse Protection final rule, delaying the effective date of all provisions other than those in § 11.19 until April 2, 2025.

In the postponement, we noted that, on July 1, 2024, a complaint was filed in the U.S. District Court for the Northern District of Texas and amended on September 23, 2024. 3 The amended complaint alleged, in part, that the 2024 Horse Protection final rule exceeded APHIS's statutory authority and would have a significant economic impact on the Tennessee Walking Horse industry altogether. The amended complaint requested vacatur of the final rule. The parties completed briefing on their cross motions for summary judgment on December 20, 2024.

In the postponement, we explained that we were taking the action pursuant to section 705 of the Administrative Procedure Act to temporarily preserve the regulatory status quo during the pendency of the litigation.

On January 31, 2025, the U.S. District Court for the Northern District of Texas issued its decision. The Court held that APHIS had exceeded its statutory authority in the 2024 Horse Protection final rule by issuing a blanket prohibition of the use of pads, action devices, and substances on Tennessee Walking Horses and racking horses; that a Dermatologic Conditions Indicative of Soring provision intended to replace the “scar rule”  4 failed to provide adequate due process; and that the rule's pre- and post-deprivation reviews failed to provide adequate due process. In the order, the Court vacated the above provisions, found in §§ 11.5, 11.6(c), 11.7, and 11.8(h) of the 2024 Horse Protection final rule. However, the Court held that the final rule's replacement of the Designated Qualified Persons (DQP) program with Horse Protection Inspectors (HPIs) does not constitute an excess of statutory authority and is otherwise in compliance with the law.

With many of the provisions in the 2024 Horse Protection final rule vacated, the final rule now only amends a patchwork of several portions of the existing regulations. The final rule, as partially upheld by the district court, removes the requirement that DQPs be trained and licensed by horse industry organizations (HIOs) and removes the term DQPs from the regulations. In its place, the final rule specifies that APHIS will authorize HPIs, preferably licensed veterinarians, after screening them for potential conflicts of interest and conducting training. After the effective date of the other provisions of the final rule, management may use HPIs, not DQPs, to identify horses which are sore or otherwise inspect horses for compliance with the Act or regulations. Any DQPs seeking to continue inspecting or other persons wishing to become inspectors after the effective date of the final rule must apply to APHIS to become an HPI and meet the eligibility qualifications for authorization included in § 11.19. While the requirements in § 11.19 for training and authorizing HPIs became effective June 7, 2024, the requirement in § 11.18 that management pivot from electing to utilize DQPs to electing to utilize HPIs has not yet become effective. The final rule also amends reporting requirements, significantly expanding the number of entities subject to its applicability to include shows, exhibitions, sales and auctions of all breeds of horses, not just Tennessee Walking Horses or racking horses, as well as imposing earlier timeframes for reporting.

Following the Court's decision, on March 21, 2025, APHIS published in the Federal Register (90 FR 13273-13276)  5 a document announcing a further delay of the effective date to February 1, 2026, and a request for comment regarding whether the length of the postponement should be extended. In that document, we explained that postponement would allow APHIS the necessary time to identify appropriate next steps regarding the Horse Protection regulations, including whether the length of the postponement should be further extended. We also stated that allowing the non-vacated portions of the rule to go into effect on April 2, 2025, the previously scheduled effective date, would be untenable for APHIS and disruptive to the industry.

We solicited comments concerning the length of the postponement for 60 days ending May 20, 2025. Specifically, we inquired of the public whether the extended length of postponement provided a sufficient period of time, or whether the delay should be extended further. We also solicited any supplemental information regarding HPA authorities, standards, recordkeeping, or other matters that could help inform a decision regarding the appropriate length of time for postponement.

We received 6,124 comments in response to our request. The comments were from members of Congress; State agricultural agencies and farm bureaus; horse industry organizations; equine veterinarians and veterinary associations; animal welfare advocacy organizations; cattle grower associations; horse owners, trainers, and exhibitors; small business owners, and other interested persons.

Many comments, including substantive comments from the individuals and entities who are subject to the requirements of the Horse Protection regulations, supported further postponement of the 2024 Horse Protection final rule.

Specifically, many commenters asked us to delay the implementation of the 2024 Horse Protection final rule to allow time to carry out their suggestions of reopening the comment period on the final rule, holding listening sessions, and/or initiating a new rulemaking. Numerous commenters suggested that this may be accomplished by January or February 2027.

We are further postponing the 2024 Horse Protection final rule to December 31, 2026 due to events that arose after the close of the comment period on the March 2025 further delay of effective date and request for comment. We discuss these events later in this document. We believe December 31, 2026 will provide APHIS with sufficient time to identify appropriate next steps in light of the new circumstances.

Many commenters suggested that the 2024 Horse Protection final rule never go into effect, and instead urged a withdrawal or rewrite of the rule. These commenters expressed numerous concerns with the final rule and/or the Horse Protection regulations. Concerns included, among others, an insufficient number of trained inspectors; insufficient funding and resources in USDA for inspections; increased costs, especially at small local events; various requests for additional changes to the Horse Protection regulations, including revision to the reporting requirements that now include additional horse breeds and events; and the opinion that the final rule was unworkable as currently written.

As noted above, APHIS believes that further delay until December 31, 2026 is warranted at this time in order to identify appropriate next steps for the 2024 Horse Protection final rule, particularly in light of intervening events that have occurred since the March 2025 further delay was issued. We believe that this will constitute a sufficient amount of time to identify such steps.

Suggestions for additional rulemaking, including withdrawal or rewrite of the 2024 Horse Protection final rule, as well as comments citing problems with the non-vacated portions of the 2024 Horse Protection final rule and the Horse Protection regulations, are outside the scope of our request for comments regarding the length of postponement. However, we may consider them in future rulemaking.

Many other comments, including variations of a single form letter submitted by over 5,000 persons, as well as a letter submitted by an animal advocacy organization supporting the rule with over 87,500 signatories listed, advocated for no further postponement and expressed strong support for the non-vacated provisions of the 2024 Horse Protection final rule.

Many of these commenters stated that further delaying implementation of the HPI program would perpetuate an inadequate inspection model that leaves horses at risk of soring. We understand commenters' concerns and are committed to working to end the practice of soring. However, events that arose since the close of the comment period on the March 2025 delay of effective date and request for comment, which we will discuss later in this document, have led us to believe that further postponement is necessary.

Some commenters stated that APHIS should pursue additional rulemaking that addresses the problems that the provisions vacated by the court were intended to address, in a manner compliant with the court's order.

Suggestions for additional rulemaking are outside the scope of our request for comments regarding the length of postponement. However, we may consider them in future rulemakings.

Commenters also urged us to implement the HPI program immediately because those portions of the final rule have undergone extensive public input, were finalized through a lawful rulemaking process, and have been upheld by the court.

Although we agree that the HPI provisions of the 2024 Horse Protection final rule have undergone extensive public input, were finalized through a lawful rulemaking process, and have been upheld by the court, we disagree that this means the HPI program is immediately implementable. As we explained in the March 2025 further delay of effective date and request for comment, due to the vacatur of the provisions governing prohibited items at shows and criteria for identifying soring, APHIS required time to re-train prospective HPIs in accordance with the surviving regulations. Moreover, events that arose after the close of the comment period on the March 2025 delay have complicated our plans for re-training prospective HPIs.

On June 30, 2025, a new complaint was filed in the U.S. District Court for the Northern District of Texas  6 challenging aspects of the existing regulations and associated guidance. Specifically, the complaint challenged USDA's “No-Showback Rule,” ( i.e., the policy prohibition on horses found sore or otherwise noncompliant with the HPA or regulations from being “shown back” or competing in a subsequent class of the same show), the “scar rule,” and the adequacy of the due process protections for custodians of horses that management disqualifies based on USDA inspections conducted in accordance with § 11.4 of the regulations. Plaintiffs sought entry of a preliminary injunction to prevent USDA from enforcing these rules and policies and on August 19, 2025, the Court granted plaintiffs' motion for preliminary injunction as to each named plaintiff.

Although the preliminary injunction of the existing regulations only applies to the plaintiffs in this case (individuals and Tennessee Walking Horse National Celebration Association), it renders implementation of the final rule piecemeal and unmanageable during the pendency of this litigation. As discussed in our March 21, 2025 notice, the most significant non-vacated provisions of the 2024 Horse Protection final rule are the provisions that replace the industry-licensed DQPs with HPIs. The preliminary injunction creates uncertainty regarding the existing “scar rule,” which impacts APHIS's ability to develop and train HPIs for the upcoming show season. For example, in March 2025, when we issued the notice further delaying the effective date of the rule, APHIS had trained HPIs based on the provisions in the 2024 Horse Protection final rule. As it stands, APHIS would have to retrain the newly licensed HPIs on the existing regulations (which are, in part, the subject of a preliminary injunction) and may need to further retrain them depending on the outcome of the subsequently filed case, which would result in additional costs and potential confusion.

As noted above, due to the preliminary injunction, APHIS is presently unable to enforce several key provisions of the existing Horse Protection Act regulations with respect to the named plaintiffs (individuals and Tennessee Walking Horse National Celebration Association) and, to be consistent, has chosen not to enforce these same provisions industry-wide. Beyond the additional costs and confusion, APHIS has trained only 17 HPIs to perform HPA-related inspections compared to more than 60 Designated Qualified Persons licensed by Horse Industry Organization to perform HPA inspections, and the parties in question were trained on the 2024 Horse Protection final rule prior to partial vacatur. Notwithstanding these challenges, in March 2025, when we issued the notice delaying the effective date, the existing regulations had not yet been challenged and could potentially be combined with the non-vacated provisions of the 2024 Horse Protection final rule to establish a functional regulatory framework. This is no longer certain, given the pending litigation.

Beyond this, in November 2025, the House Committee Report that accompanied the Fiscal Year 2026 appropriations package contained notes to APHIS related to the 2024 Horse Protection final rule and, among other things, directed APHIS to withdraw the rule.

Because of the potential impact of the pending case challenging the existing regulations, the U.S. District Court for the Northern District of Texas' vacatur of several key portions of the 2024 Horse Protection final rule, and APHIS's ongoing review of the House Committee Report, we have determined that it is necessary to further postpone the effective date of the 2024 Horse Protection Act final rule to December 31, 2026. For these reasons, we are further postponing the effective date of the portions of the final rule that have not been vacated by the District Court and otherwise would go into effect on February 1, 2026.

APHIS is taking this action, effective immediately, based on the good cause exceptions in 5 U.S.C. 553(b)(B) and 553(d)(3). The need for regulatory clarity in this context satisfies the good-cause requirement.

Moreover, this notice further extending the effective date of the non-vacated provisions of the 2024 Horse Protection final rule does not impose any new obligations but rather delays new recordkeeping and reporting requirements for certain horse show and sale managers who do not have such obligations under the existing regulations. Thus, this postponement may be immediately effective under 5 U.S.C. 553(d)(1), because extending the effective date of this final rule would grant an exception or relieve a restriction.

APHIS has also determined that it would be impracticable and contrary to the public interest to provide additional notice and comment on this action to postpone the effective date of the non-vacated provisions of the 2024 Horse Protection final rule to December 31, 2026. It is impracticable because there is not sufficient time to conduct an additional notice-and-comment process between now and February 1, 2026. Additionally, as stated above, it is not feasible for the agency to implement the non-vacated provisions on February 1, 2026. This is because, due to the pending lawsuit and the uncertainty of how it would affect the regulatory regime, APHIS has not been able to develop training content for HPIs that would enable it to (1) recruit an adequate number of HPIs to provide coverage for the 2026 show season and (2) train the HPIs to detect and diagnose soring based on stable regulatory requirements. Given these limitations, there are no fully trained and licensed HPIs available to serve as qualified inspectors for show management should they wish to retain them. If the non-vacated provisions of the 2024 rule were to take effect, the new HPI provisions would replace the third-party inspection program currently in place (DQPs and HIOs), thus eliminating the availability of any qualified inspectors that show management could retain to evaluate horses for soreness prior to participation in HPA-covered events. This means that, for the first time since 1979, show management would immediately become responsible for determining how it will meet its obligations under the HPA without the availability third-party inspectors licensed through USDA.

Please refer to Docket ID NRC-2025-1369 when contacting the NRC about the availability of information for this action. You may obtain publicly available information related to this action by any of the following methods:

• Federal Rulemaking Website: Go to https://www.regulations.gov and search for Docket ID NRC-2025-1369. Address questions about NRC dockets to Helen Chang, telephone: 301-415-3228, email: Helen.Chang@nrc.gov. For technical questions contact the individual listed in the FOR FURTHER INFORMATION CONTACT section of this document.

• NRC's Agencywide Documents Access and Management System (ADAMS): You may obtain publicly available documents online in the ADAMS Public Documents collection at https://www.nrc.gov/reading-rm/adams.html. To begin the search, select “Begin Web-based ADAMS Search.” For problems with ADAMS, please contact the NRC's Public Document Room (PDR) reference staff at 1-800-397-4209, 301-415-4737, or by email to PDR.Resource@nrc.gov. For the convenience of the reader, instructions about obtaining materials referenced in this document are provided in the “Availability of Documents” section.

• NRC's PDR: The PDR, where you may examine and order copies of publicly available documents, is open by appointment. To make an appointment to visit the PDR, please send an email to PDR.Resource@nrc.gov or call 1-800-397-4209 or 301-415-4737, between 8 a.m. and 4 p.m. eastern time, Monday through Friday, except Federal holidays.

The NRC encourages electronic comment submission through the Federal rulemaking website ( https://www.regulations.gov ). Please include Docket ID NRC-2025-1369 in your comment submission.

The NRC cautions you not to include identifying or contact information that you do not want to be publicly disclosed in your comment submission. The NRC will post all comment submissions at https://www.regulations.gov as well as enter the comment submissions into ADAMS. The NRC does not routinely edit comment submissions to remove identifying or contact information.

If you are requesting or aggregating comments from other persons for submission to the NRC, then you should inform those persons not to include identifying or contact information that they do not want to be publicly disclosed in their comment submission. Your request should state that the NRC does not routinely edit comment submissions to remove such information before making the comment submissions available to the public or entering the comment into ADAMS.

The NRC is using the “direct final rule procedure” to issue this amendment because this action represents a limited and routine change to an existing certificate of compliance (CoC) that is expected to be non-controversial and, accordingly, is unlikely to result in significant adverse public comments. Adequate protection of public health and safety continues to be reasonably assured. The amendment to the rule will become effective on April 13, 2026. However, if the NRC receives significant adverse comments on this direct final rule by February 27, 2026, then the NRC will publish a document that withdraws this action and will subsequently address the comments received in a final rule as a response to the companion proposed rule published in the Proposed Rules section of this issue of the Federal Register or as otherwise appropriate. In general, absent significant modifications to the proposed revisions requiring republication, the NRC will not initiate a second comment period on this action.

A significant adverse comment is a comment where the commenter explains why the rule would be inappropriate, including challenges to the rule's underlying premise or approach, or would be ineffective or unacceptable without a change. A comment is adverse and significant if:

(1) The comment opposes the rule and provides a reason sufficient to require a substantive response in a notice-and-comment process. For example, a substantive response is required when:

(a) The comment causes the NRC to reevaluate (or reconsider) its position or conduct additional analysis;

(b) The comment raises an issue serious enough to warrant a substantive response to clarify or complete the record; or

(c) The comment raises a relevant issue that was not previously addressed or considered by the NRC.

(2) The comment proposes a change or an addition to the rule, and it is apparent that the rule would be ineffective or unacceptable without incorporation of the change or addition.

(3) The comment causes the NRC to make a change (other than editorial) to the rule, CoC, or TS.

For detailed instructions on filing comments, please see the ADDRESSES section of this document.

Section 218(a) of the Nuclear Waste Policy Act of 1982, as amended, requires that “[t]he Secretary [of the Department of Energy] shall establish a demonstration program, in cooperation with the private sector, for the dry storage of spent nuclear fuel at civilian nuclear power reactor sites, with the objective of establishing one or more technologies that the [Nuclear Regulatory] Commission may, by rule, approve for use at the sites of civilian nuclear power reactors without, to the maximum extent practicable, the need for additional site-specific approvals by the Commission.” Section 133 of the Nuclear Waste Policy Act states, in part, that “[t]he Commission shall, by rule, establish procedures for the licensing of any technology approved by the Commission under section 219(a) [sic: 218(a)] for use at the site of any civilian nuclear power reactor.”

To implement this mandate, the Commission approved dry storage of spent nuclear fuel in NRC-approved casks under a general license by publishing a final rule that added a new subpart K in part 72 of title 10 of the Code of Federal Regulations (10 CFR) entitled “General License for Storage of Spent Fuel at Power Reactor Sites” (55 FR 29181; July 18, 1990). This rule also established a new subpart L in 10 CFR part 72 entitled “Approval of Spent Fuel Storage Casks,” which contains procedures and criteria for obtaining NRC approval of spent fuel storage cask designs. The NRC subsequently issued a final rule on March 24, 2017 (82 FR 14987), that approved the TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System design and added it to the list of NRC-approved cask designs in § 72.214 as CoC No. 1042.

This rule is limited to the changes contained in Amendment No. 5 to CoC No. 1042 and does not include other aspects of the TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System design.

On February 26, 2025, (ADAMS Accession No. ML25057A456), as supplemented on August 28, 2025 (ML25240B483), TN Americas LLC submitted a request to the NRC to amend CoC No. 1042 to make the following changes:

• Addition of a new HLZC for the EOS-37PTH, HLZC 14, which allows an increase in the maximum heat load of the EOS-37PTH to 54 kW per DSC for storage in the EOS-HSM and transfer operations in the EOS-TC125/135. HLZC 14 is only permitted in Basket Type 4HA introduced in Amendment No. 4 to CoC No. 1042 with anodized aluminum. No physical changes are considered for this basket type in this application. An optional support spacer is considered for the flat plate variant of EOS-HSM as described in the application.

• Clarification regarding acceptance criteria for minor surface imperfections on HSLA basket plates within the UFSAR.

• Editorial corrections:

• Revision of Section 2.4.2.1 of the UFSAR has been revised to clarify that the heat load for any single assembly is 4.3 kW for the EOS-37PTH DSC. This is an editorial correction based on HLZC 12 included as part of application for Amendment No. 4 to CoC No. 1042.

• Revision of Note 3 of figure 2-3m (HLZC 13 for the EOS-37PTH DSC) to enhance readability.

• Revision of TS figures 1A and 1J to clarify the location of HLZC 1 and 10 for EOS-37PTH.

• Editorial changes in TS section 4.4.4 to refer to the correct section of ASME code section NB-5520 that relates to qualification requirements.

The changes to the aforementioned documents are identified with revisions bars in the margin of each document.

As documented in the preliminary safety evaluation report, the NRC performed a safety evaluation of the proposed CoC amendment request. The NRC determined that this amendment does not reflect a significant change in design or fabrication of the cask. Specifically, the NRC determined that the design of the cask would continue to maintain confinement, shielding, and criticality control in the event of each evaluated accident condition. In addition, any resulting occupational exposure or offsite dose rates from the implementation of Amendment No. 5 would remain well within the limits specified by 10 CFR part 20, “Standards for Protection Against Radiation.” Therefore, the NRC found there will be no significant change in the types or amounts of any effluent released, no significant increase in the individual or cumulative radiation exposure, and no significant increase in the potential for or consequences from radiological accidents.

The NRC determined that the amended TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System cask design, when used under the conditions specified in the CoC, the TS, and the NRC's regulations, will meet the requirements of 10 CFR part 72; therefore, adequate protection of public health and safety will continue to be reasonably assured. This direct final rule changes the TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System listing in § 72.214 by adding Amendment No. 5 to CoC No. 1042. The amendment consists of the changes previously described, as set forth in the referenced CoC and TS. The referenced TS are identified in the preliminary safety evaluation report. When this direct final rule becomes effective, persons who hold a general license under § 72.210 may, consistent with the license conditions under § 72.212, load spent nuclear fuel into TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System casks that meet the criteria of Amendment No. 5 to CoC No. 1042.

The National Technology Transfer and Advancement Act of 1995 (Pub. L. 104-113) requires that Federal agencies use technical standards that are developed or adopted by voluntary consensus standards bodies unless the use of such a standard is inconsistent with applicable law or otherwise impractical. In this direct final rule, the NRC revises the TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System design listed in § 72.214, “List of approved spent fuel storage casks.” This action does not constitute the establishment of a standard that contains generally applicable requirements; therefore, the National Technology Transfer and Advancement Act is not applicable.

Under the “Agreement State Program Policy Statement” approved by the Commission on October 2, 2017, and published in the Federal Register on October 18, 2017 (82 FR 48535), this rule is classified as Compatibility Category NRC—Areas of Exclusive NRC Regulatory Authority. The NRC program elements in this category are those that relate directly to areas of regulation reserved to the NRC by the Atomic Energy Act of 1954, as amended, or the provisions of 10 CFR chapter I. Therefore, compatibility is not required for program elements in this category.

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

Under the National Environmental Policy Act of 1969, as amended, and the NRC's regulations in 10 CFR part 51, “Environmental Protection Regulations for Domestic Licensing and Related Regulatory Functions,” the NRC has determined that this direct final rule, if adopted, would not be a major Federal action significantly affecting the quality of the human environment and, therefore, an environmental impact statement is not required. The NRC has made a finding of no significant impact on the basis of this environmental assessment. This environmental assessment and finding of no significant impact can be tracked with identification number NEPA ID EAXX-429-00-000-1743148474.

The action is to amend § 72.214 to change the TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System listing within the “List of approved spent fuel storage casks” to include Amendment No. 5 to CoC No. 1042.

This direct final rule amends the CoC for the TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System design within the list of approved spent fuel storage casks to allow power reactor licensees to store spent fuel at reactor sites in casks with the approved modifications under a general license. Specifically, Amendment No. 5 adds a new heat load zone configuration (HLZC 14) for the EOS-37PTH canister, increasing the maximum heat load to 54 kW per DSC for storage in the EOS-HSM and transfer using EOS-TC125/135; clarifies acceptance criteria for minor surface imperfections on HSLA basket plates in the UFSAR; and makes editorial updates to the UFSAR and TS revisions to align with Amendment No. 4, improve readability, and correct code references.

On July 18,1990 (55 FR 29181), the NRC issued an amendment to 10 CFR part 72 to provide for the storage of spent fuel under a general license in cask designs approved by the NRC. The potential environmental impact of using NRC-approved storage casks was analyzed in the environmental assessment for the 1990 final rule. The environmental assessment for this Amendment No. 5 tiers off of the environmental assessment for the July 18, 1990, final rule. Tiering on past environmental assessments is a standard process under the National Environmental Policy Act of 1969, as amended.

The TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System is designed to mitigate the effects of design basis accidents that could occur during storage. Design basis accidents account for human-induced events and the most severe natural phenomena reported for the site and surrounding area. Postulated accidents analyzed for an independent spent fuel storage installation, the type of facility at which a holder of a power reactor operating license would store spent fuel in casks in accordance with 10 CFR part 72, can include tornado winds and tornado-generated missiles, a design basis earthquake, a design basis flood, an accidental cask drop, lightning effects, fire, explosions, and other incidents.

This amendment does not reflect a significant change in design or fabrication of the cask. Because there are no significant design or process changes, any resulting occupational exposure or offsite dose rates from the implementation of Amendment No. 5 would remain well within the 10 CFR part 20 limits.

The NRC has also determined that the design of the cask as modified by this rule would continue to maintain confinement, shielding, and criticality control in the event of an accident. Therefore, the proposed changes will not result in any radiological or non-radiological environmental impacts that significantly differ from the environmental impacts evaluated in the environmental assessment supporting the July 18, 1990, final rule. There will be no significant change in the types or significant revisions in the amounts of any effluent released, no significant increase in the individual or cumulative radiation exposures, and no significant increase in the potential for, or consequences from, radiological accidents. The NRC documented its safety findings in the preliminary safety evaluation report.

The alternative to this action is to deny approval of Amendment No. 5 and not issue the direct final rule. Consequently, any 10 CFR part 72 general licensee that seeks to load spent nuclear fuel into the TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System in accordance with the changes described in proposed Amendment No. 5 would have to request an exemption from the requirements of §§ 72.212 and 72.214. Under this alternative, interested licensees would have to prepare, and the NRC would have to review, a separate exemption request, thereby increasing the administrative burden upon the NRC and the costs to each licensee. The environmental impacts would be the same as the proposed action.

Approval of Amendment No. 5 to CoC No. 1042 would result in no irreversible and irretrievable commitments of Federal resources.

No agencies or persons outside the NRC were contacted in connection with the preparation of this environmental assessment.

The environmental impacts of the action have been reviewed under the requirements in the National Environmental Policy Act of 1969, as amended, and the NRC's regulations in subpart A of 10 CFR part 51, “Environmental Protection Regulations for Domestic Licensing and Related Regulatory Functions.” Based on the foregoing environmental assessment, the NRC concludes that this direct final rule, “List of Approved Spent Fuel Storage Casks: TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System, Certificate of Compliance No. 1042, Amendment No. 5,” will not have a significant effect on the human environment. Therefore, the NRC has determined that an environmental impact statement is not necessary for this direct final rule.

This direct final rule does not contain any new or amended collections of information subject to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq. ). Existing collections of information were approved by the Office of Management and Budget, approval number 3150-0132.

The NRC may not conduct or sponsor, and a person is not required to respond to, a request for information or an information collection requirement unless the requesting document displays a currently valid Office of Management and Budget control number.

Under the Regulatory Flexibility Act of 1980 (5 U.S.C. 605(b)), the NRC certifies that this direct final rule will not, if issued, have a significant economic impact on a substantial number of small entities. This direct final rule affects only nuclear power plant licensees and TN Americas LLC. These entities do not fall within the scope of the definition of small entities set forth in the Regulatory Flexibility Act or the size standards established by the NRC (§ 2.810).

On July 18, 1990 (55 FR 29181), the NRC issued an amendment to 10 CFR part 72 to provide for the storage of spent nuclear fuel under a general license in cask designs approved by the NRC. Any nuclear power reactor licensee can use NRC-approved cask designs to store spent nuclear fuel if (1) it notifies the NRC in advance; (2) the spent fuel is stored under the conditions specified in the cask's CoC; and (3) the conditions of the general license are met. A list of NRC-approved cask designs is contained in § 72.214. On March 24, 2017 (82 FR 14987), the NRC issued an amendment to 10 CFR part 72 that approved the TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System by adding it to the list of NRC-approved cask designs in § 72.214.

On February 26, 2025, as supplemented on August 28, 2025, TN Americas LLC requested that the NRC amend CoC No. 1042 for the NUHOMS® EOS system submitted a request to amend the NUHOMS® EOS Dry Spent Fuel Storage System as described in section IV, “Discussion of Changes,” of this document.

The alternative to this action is to withhold approval of Amendment No. 5 and to require any 10 CFR part 72 general licensee seeking to load spent nuclear fuel into TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System under the changes described in Amendment No. 5 to request an exemption from the requirements of §§ 72.212 and 72.214. Under this alternative, each interested 10 CFR part 72 licensee would have to prepare, and the NRC would have to review a separate exemption request, thereby increasing the administrative burden upon the NRC and the costs to each licensee.

Approval of this direct final rule is consistent with previous NRC actions. Further, as documented in the preliminary safety evaluation report and environmental assessment, this direct final rule will have no adverse effect on public health and safety or the environment. This direct final rule has no significant identifiable impact or benefit on other government agencies. Based on this regulatory analysis, the NRC concludes that the requirements of this direct final rule are commensurate with the NRC's responsibilities for public health and safety and the common defense and security. No other available alternative is believed to be as satisfactory; therefore, this action is justified.

The NRC has determined that this direct final rule does not constitute backfitting under § 72.62. This direct final rule adds an amendment to CoC No. 1042 for the TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System, as currently listed in § 72.214. The amendment consists of the changes in Amendment No. 5 previously described, as set forth in the amended CoC and TS.

Amendment No. 5 to CoC No. 1042 for the TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System was initiated by TN Americas LLC and was not submitted in response to new NRC requirements or an NRC request for amendment. CoC holders like TN Americas LLC are not within the scope of the backfit rule in § 72.62 because they do not hold a 10 CFR part 72 license. Additionally, Amendment No. 5 applies only to new casks fabricated and used under Amendment No. 5. These changes do not affect existing users of TN Americas LLC, NUHOMS® EOS Dry Spent Fuel Storage System, and the previous amendments continue to be effective for existing users. Although current users of this storage system may comply with the new requirements in Amendment No. 5, this would be a voluntary decision on the part of current users. Therefore, Amendment No. 5 does not meet the definition of backfitting in § 72.62.

For these reasons, Amendment No. 5 to CoC No. 1042 does not constitute backfitting under § 72.62.

Executive Order (E.O.) 12866, as amended by E.O. 14215, provides that the Office of Information and Regulatory Affairs (OIRA) will determine whether a regulatory action is significant as defined by E.O. 12866 and will review significant regulatory actions. OIRA determined that this direct final rule is not a significant regulatory action under E.O. 12866.

This direct final rule is not a rule as defined in the Congressional Review Act.

The documents identified in the following table are available to interested persons as indicated.

The NRC may post materials related to this document, including public comments, on the Federal rulemaking website at https://www.regulations.gov under Docket ID NRC-2025-1369. In addition, the Federal rulemaking website allows members of the public to receive alerts when changes or additions occur in a docket folder. To subscribe: (1) navigate to the docket folder NRC-2025-1369; (2) click the “Subscribe” link; and (3) enter an email address and click on the “Subscribe” link.

For the reasons set out in the preamble and under the authority of the Atomic Energy Act of 1954, as amended; the Energy Reorganization Act of 1974, as amended; the Nuclear Waste Policy Act of 1982, as amended; and 5 U.S.C. 552 and 553; the NRC is adopting the following amendments to 10 CFR part 72:

On December 30, 2025, the Commission published in the Federal Register (90 FR 61226) a final rule (the “Final Rule”) amending certain of the Commission's business conduct and documentation requirements applicable to swap dealers and major swap participants. The Final Rule is effective January 29, 2026. The amendments consisted chiefly of a revision of the regulatory text of subpart H of 17 CFR part 23 in its entirety ( see 90 FR 61252, amendatory instruction 2). There is also an appendix A to subpart H, “Guidance on the Application of §§ 23.434 and 23.440 for Swap Dealers That Make Recommendations to Counterparties or Special Entities.” This appendix has been present in the Commission's rules from the time that subpart H was added to part 23 in 2012 ( see 77 FR 9734, Feb. 17, 2012). The Final Rule was not intended to alter appendix A to subpart H in any way. Accordingly, no reference to appendix A or its contents was included in the amendments to the regulatory text of subpart H or the table of contents thereto, as presented in the Final Rule.

As a technical codification matter, because the Final Rule amendments are presented as revising subpart H as a whole, without an explicit instruction to retain appendix A to the subpart unchanged, the appendix will be removed from the Code of Federal Regulations (CFR) when the amendments are incorporated. Such an outcome would be unintended and erroneous. The lack of an instruction in the Final Rule specifying that appendix A to subpart H should be retained in the CFR was an inadvertent technical oversight.

To remedy this technical error, this correcting amendment sets forth the contents of appendix A to subpart H of 17 CFR part 23, as they exist currently, prior to the effectiveness of the Final Rule, with an instruction that the appendix be added back to the subpart. Presentation of this correction as an addition of the appendix is necessary due to the technical mechanics of the CFR codification process. Nonetheless, and for the avoidance of doubt, this correcting amendment makes no changes to the contents of appendix A. Because the correcting amendment does not make any changes or otherwise impose any new substantive regulatory requirements, pre-publication public comment period is unnecessary. 1

Accordingly, 17 CFR part 23 is corrected by making the following correcting amendment:

The Coast Guard will enforce special local regulations in 33 CFR 100.701 for the St. Thomas International Regatta regulated area daily from 8 a.m. to 4 p.m. on April 2 through April 5, 2026. This action is being taken to provide for the safety of life on navigable waterways during this 4-day event. Our regulation for marine events within the Southeast Coast Guard District, § 100.701, in table 1 to § 100.701, paragraph (a), item 2, specifies the location of the regulated area for the St, Thomas International Regatta which encompasses portions of Jersey Bay, St. James Bay, Great Bay, and Little St. James in St. Thomas, USVI. During the enforcement periods, as reflected in § 100.100(c), entry of vessels or persons into this zone is prohibited unless specifically authorized by the Captain of the Port San Juan.

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

The Forest Service (Agency) is revising its Oil and Gas Resources (36 CFR part 228, subpart E) regulations. Acting under established legal authorities, the Forest Service regulates surface disturbing activities conducted pursuant to a Federal oil and gas lease on national forests and grasslands. The existing regulations were first promulgated in 1990, with only a minor modification in 2007. Updating the regulations affords an opportunity to modernize existing procedures to streamline processes and promote efficiency. The Forest Service anticipates that updated interpretive guidance for implementing the final regulations will be developed in 2025 and set out in the Agency's directive system in 2026.

On June 16, 2023, the BLM promulgated a final rule placing the current content of Onshore Order 1, which provided requirements for the approval of oil and gas operations, into its regulations at 43 CFR part 3170, subpart 3171—Approval of Operations. The Office of the Federal Register had informed the BLM that it could no longer revise the existing Onshore Orders unless the agency codified the Orders in the Code of Federal Regulations. While this action has no substantive effect on this final rule, they do necessitate citation changes where Onshore Order 1 was used in the proposed Forest Service oil and gas rule and removing section 228.102(a) (Issuance of Onshore Orders) as later described under the heading “Section-by-Section Description of the Final Rule Changes from Existing and Proposed Rules.”

This rulemaking applies to only Federal oil and gas resources on lands managed by the National Forest System, and it does not affect nonfederal (such as reserved and outstanding private) oil and gas resources.

The rule will contribute to increasing efficiencies in evaluating and managing surface disturbing activities conducted pursuant to Federal oil and gas leases and will help the Forest Service achieve its strategic goal of delivering benefits to the public. The Agency is revising its existing regulations to clarify internal processes related to evaluating and approving oil and gas leasing operations, clarifying oil and gas operators' responsibility to protect natural resources and the environment, clarifying the Agency's procedures regarding inspections and compliance, and updating material noncompliance procedures to reflect existing Agency practices and better reflect requirements of law. The changes to 36 CFR part 228 require minor conforming changes to regulations at 36 CFR parts 214 (Post Decisional Administrative Review Process for Occupancy or Use of National Forest System Lands and Resources) and 261 (Prohibitions).

The changes finalized in this rule will not materially alter the basic responsibilities of either the Forest Service or oil and gas operators. The changes aim to clarify procedures, reduce redundancy, and promote harmonious interaction with other existing rules. For example, one notable change aims to simplify the administrative process the Agency follows to determine which lands are available for leasing, reduces the amount of time allotted for it to take the Agency to make these decisions while at the same time maintaining all environmental and human health and safety protections of the current rule.

The rule also clarifies the procedures that the Forest Service follows to require an operator to take corrective actions if operations are found to be out of compliance with the approved surface use plan of operations, including establishing a formal option to refer instances of continued noncompliance to the BLM. The rule would retain operator requirements for emergency abatement when the Agency acts to remedy emergency situations such as fires or spills to which the operator cannot or will not respond. The rule would also revise the Agency's material noncompliance proceedings by streamlining the process and reflecting consequences defined in the Mineral Leasing Act (30 U.S.C. 226(g)). These changes would simplify the compliance process in Agency inspections, resulting in better management and protection of surface resources.

The rule will promote coordination and efficiency between the Forest Service and the BLM. The BLM is the Federal agency primarily responsible for managing federally owned minerals, including minerals underlying lands managed by the Forest Service. The Forest Service and the BLM jointly manage leasing and operations when oil and gas activities involve National Forest System lands, and oftentimes project proponents operate on lands managed by both agencies. Generally speaking, the Secretary of the Interior has the final decision whether to issue oil and gas leases on Federal lands, including National Forest System lands, subject to Forest Service consent.

Congress has long recognized the importance of mineral resources located on lands within the National Forest System and has repeatedly made special provisions for the administration and development of these minerals.

Congress enacted the Mineral Leasing Act of 1920 (30 U.S.C. 181, et seq. ), directing that the development of Federal oil and gas resources would be subject to a leasing system under the direction of the Department of the Interior. Initially, the Department of Interior did not have to obtain the consent of the Forest Service to issue oil and gas leases on National Forest System lands, but that was changed with the Mineral Leasing Act for Acquired Lands of 1947 (30 U.S.C. 351 et seq. ) and the Federal Onshore Oil and Gas Leasing Reform Act of 1987 (Pub. L. 100-203, the Reform Act), which directed that the Department of the Interior may not issue any oil and gas lease on National Forest System lands without the “consent of” or “over the objection of” the USDA, respectively. The Mineral Leasing Act for Acquired Lands authorized the Secretary of the Interior to lease oil and gas deposits on acquired National Forest System lands “under the same conditions as contained in the leasing provisions of the mineral leasing laws” upon obtaining the consent of the Secretary of Agriculture (30 U.S.C. 352). The Act also required the Secretary of the Interior to include in such leases any conditions prescribed by the Secretary of Agriculture to “ensure the adequate utilization of the lands for the primary purposes for which they have been acquired or are being administered.” The 1987 Reform Act also granted the USDA express authority to regulate all surface-disturbing activities conducted pursuant to any oil and gas lease on lands managed by the Forest Service. The Mineral Leasing Act, as amended, also specifies requirements for inspections and compliance, the consequences of noncompliance, and for approvals to operate on National Forest System lands.

In 2005, Congress directed Federal agencies to streamline and reduce timeframes for processing proposals to lease and conduct oil and gas operations on Federal lands. See Energy Policy Act of 2005 (Pub. L. 109-58), subtitle F, sections 361, 362, and 390. The BLM is principally responsible for tracking applications for operations on Federal oil and gas leases and does so through a database called the Automated Fluid Minerals Support System (AFMSS II). The Forest Service has access to AFMSS II to track surface use plans of operations and master surface use plans of operations.

In 2007, the Forest Service and the BLM jointly established coordination procedures for the review and analysis of permits to drill, including the surface use plan of operation portion in Onshore Order 1, now codified as 43 CFR part 3170, subpart 3171.

There are currently 5,154 Federal oil and gas leases covering about 3.8 million acres (about 2 percent) of National Forest System lands. Approximately 2,850 of these leases, covering 1.8 million acres across 39 national forests and grasslands, have producing Federal oil or gas wells; however, the footprint of actual operations comprises a small percentage (less than 10 percent) of that area. Operating on these leases are 2,901 wells, which in 2022 produced over 48 million barrels of oils (1.1 percent of the Nation's total) and over 167 billion cubic feet of natural gas (0.4 percent of the Nation's total). The production was valued at over $4.5 billion and returned approximately $565 million in royalties to the U.S. Treasury.

It is in the national interest to promote clean and safe development of our Nation's vast energy resources while preserving the surface resources of national forests and grasslands. To that end, the Forest Service seeks to facilitate the orderly development of Federal oil and gas resources in an environmentally sound manner. The final regulatory revisions are consistent with those goals.

On September 13, 2018, the USDA issued an advance notice of proposed rulemaking (ANPR) in the Federal Register (83 FR 46458), inviting public input on key issues regarding the implementation of existing oil and gas regulations and other areas of concern. The public comment period occurred from September 13 to October 15, 2018, and served as the initial scoping period for the environmental analysis. The Forest Service received 91 responses, representing a mix of general opposition and general support for the proposed rulemaking.

Stated reasons for general opposition to the rule include the destruction of national forests and natural resources for financial or political interests; inadequate protection of human and environmental health; adverse impacts on recreation opportunities and tourism; and unsustainable reliance on fossil fuels.

Stated reasons for general support of the rule include the generation of revenue, large existing demands for oil and gas, decreases in regulatory burden on the oil and gas industry, promotion of domestic energy production, the creation of a simplified process leading to quicker leasing decisions, and the elimination of duplication with the BLM.

Public comments received in response to the ANPR can be found on the internet at http://www.regulations.gov. Search for Docket ID: FS-2018-0053. Responses to the ANPR were considered during preparation of the proposed rule, which was published on September 1, 2020 (FR Doc. 2020-18518) and opened a 60-day comment period. The public submitted nearly 80,000 comments during the 60-day comment period. Approximately 99.5 percent (79,180) of the comments received were form letters collected by conservation organizations. Only 439 unique, substantive comments or letters were submitted. These comments were from unaffiliated private citizens, State agencies, counties, Alaska Native Corporations, Tribal agencies, oil and gas owners and operators, environmental groups, and business associations.

All the form letters and most of the unique comments expressed opposition at some level, whether to oil and gas development in general or to oil and gas development on National Forest System lands in particular, or to the proposed revisions to 36 CFR part 228 Subpart E or to the rulemaking process itself.

Supportive comments generally applauded the Forest Service's efforts to improve clarity and efficiency in the leasing analysis and consent decision procedures, reduce redundancies in permitting, improve coordination with the BLM, and update procedures addressing noncompliance situations. Some supportive comments suggested specific edits to regulation text to help improve the efficiency of the process or the clarity of regulatory intent.

A detailed discussion of comments and our responses is contained in the “Summary of and Response to Public Comments” section.

The final rule's revisions are based on Agency experience implementing existing regulations and are intended to better align these regulations with established joint Forest Service and the BLM Onshore Order 1 (now 43 CFR part 3170, subpart 3171) and improve Agency coordination for implementing the applicable components of the BLM's regulations (43 CFR part 3100).

The rule clarifies and streamlines the processes for identifying National Forest System lands that are available for leasing, while emphasizing an operator's responsibilities for compliance and clarifying management steps that the Forest Service will take when operators do not comply with Forest Service regulations. The rule also better aligns Forest Service regulations with those of the BLM regarding sundry notices and instances of bonding. The rule clarifies the applicability of the existing procedures in 43 CFR part 3170, subpart 3171, by which the BLM and the Forest Service jointly respond to operating proposals.

The rule relocates the contents of section 228.110, Indemnification, in the current regulations to section 228.105, Responsibilities of Operators, thereby reducing the number of sections by one. The rule also reorders, renumbers, and retitles various sections that would result in the following organization of the regulations:

The paragraphs below provide a section-by-section description of the final rule, including a description of changes made from the proposed rule. The “Summary of and Response to Public Comments” section of this preamble provides further explanation for changes that are or are not included in the final rule.

The final rule does not change language from the proposed rule except for reference to 43 CFR part 3170, subpart 3171 instead of Onshore Order 1. Compared to the existing regulation, the changes or additions to the section serve to improve readability and clarity and provide specific reference to the applicability of the BLM regulations at 43 CFR parts 3160 and 3171.

One definition was revised for the final rule. For the definition of “conditions of approval,” the final rule modified language in the proposed definition from “site-specific requirements that may be included with the approval of a surface use plan of operations that may limit or modify the specific activities covered in the plan” to “site-specific requirements shall be included with the approval of a surface use plan of operations where necessary to limit or modify the specific activities covered in the plan.” The change is made in response to a public comment that stated the use of “may” implies arbitrary discretion in the application of conditions of approval.

Compared to the existing regulation, the final rule adds the following terms and their definitions to provide functionality to the regulation's text and improve consistency with the BLM terminology: acquired lands; agreement; conditions of approval; consent; infrastructure or facilities; final abandonment notice; lease; master development plan; master surface use plan of operations; material noncompliance; Reasonably Foreseeable Development Scenario; stipulation; sundry notice; and waiver, exception, or modification.

The final rule retains as is or with minor wording changes to improve clarity the following definitions: authorized Forest Service officer; compliance officer; lessee; National Forest System lands; Notices to Lessees and Operators; operations; operator; substantial modification (described in the definition for waiver, exception, or modification); and surface use plan of operations.

The final rule removes the definitions of the following terms because they are redundant, lack applicability to the rule, or do not merit a stand-alone definition due to limited use or no special meaning beyond the plain English usage within the regulation: leasehold; onshore oil and gas order; operating right; operating rights owner; person; transfer; and transferee.

These changes are expected to benefit the regulated community, the Forest Service, and the BLM with a more harmonious set of definitions between the agencies' regulations.

The final rule removes section 228.102(a)—Onshore Oil and Gas Orders and renames the title to Issuance of Notices to Lessees and Operators. The use of Onshore Orders has been discontinued based on the advice and recommendations of the Office of the Federal Register to the Department of the Interior and USDA.

Compared to the existing regulation, the final rule moves the content of the existing section 228.102 regarding leasing analysis and decisions to section 228.103. The rule moves the requirements for Notices to Lessees and Operators from section 228.105 in the existing regulations to paragraph (b) of this section. The rule removes the procedure for the Chief of the Forest Service to issue onshore oil and gas orders for the same reasons described above regarding Onshore Orders. The final rule makes editorial changes to the text for clarity and readability that were included in the proposed rule.

The final rule carries forward the same language as the proposed rule for sections 228.103(a) through (d). The final rule removes section 228.103(e) titled Withdrawing Leasing Consent and adds a new section 228.103(e) titled Review of Leasing Consent Decision for Specific Lands, with the review leading to either a confirmation of the leasing consent decision or a withdrawal of consent (based on new information necessitating further analysis, for example). Additional language directs the Forest Service to provide notification to the BLM with the results of the review confirming the leasing consent decision for specific lands or withdrawing its leasing consent for specific parcels. If the consent is withdrawn, the notification will describe the reasons for the withdrawal and provide an anticipated course of action.

The rule removes reference to the former post-decisional appeal process governing plan and project decisions (36 CFR part 217) because it has been rendered obsolete by subsequent statutory enactments and regulations. The change remedies the outdated reference and provides direction that 36 CFR part 219, subpart B, will operate as the sole process by which the public may file objections concerning the leasing analysis and consent decision.

The final rule streamlines the approach that the Agency follows to identify lands open to leasing and stipulations to protect surface resources on lands open to leasing by establishing that the Forest Service has one decision point, that being consent to leasing made at the completion of the leasing analysis. This approach better aligns the Forest Service leasing availability analysis methods with those followed by the BLM. The rule also clearly states that the Forest Service may withdraw its consent to lease prior to the BLM conducting a lease sale.

The rule removes references to other laws and regulatory requirements, particularly with respect to complying with the National Environmental Policy Act and the Endangered Species Act and their implementing regulations, in favor of letting those laws and regulations speak for themselves and to reduce the likelihood that direction could be confused in the future if other regulations change. While several citations to specific laws and regulations have been removed, the Forest Service and lessees must still comply with all applicable laws and regulations.

Paragraph (a) of section 228.103 modernizes language regarding scheduling leasing analyses. The existing regulation references scheduling analyses within 6 months of April 20, 1990, and calls for an annual update of the schedule. The rule removes reference to a specific date, emphasizes coordination between national forests and grasslands and the BLM for scheduling, informs the public that the agencies would consider public interest in leasing, and requires an annual update to the schedule. The changes help align the efforts of Forest Service and the BLM with each other and interested parties in conducting leasing analyses.

Paragraph (b) of section 228.103 defines the required components of a leasing consent analysis. The rule maintains the same components of analysis but provides additional direction on cooperation with the BLM, the development of alternatives, and the use of stipulations. These requirements include clarifying how stipulations must be designed to carry out provisions of the Energy Policy Act of 2005 (42 U.S.C. 15922) to ensure that lease stipulations are applied consistently, coordinated between agencies, and are only as restrictive as necessary to protect the resource for which the stipulations are applied. This section incorporates parts of the existing section 228.102(b) and (c). The leasing consent analysis process directs the Forest Service to make a single decision identifying lands on which the Agency would consent to the BLM's offering oil and gas leases for the affected National Forest System lands. The existing regulation directs an administrative review by the Forest Service at the time that specific lands, which have already been subject to an area or forest-wide leasing analysis, are being scheduled for leasing by the BLM. Paragraph 228.103(f) replaces that language as described above.

Paragraph (c) of section 228.103 carries forward the components of a leasing consent decision from the existing regulations but is renamed Leasing Consent Decision. The paragraph clarifies that the Forest Service has one decision point in the process and clearly defines the required components of the Forest Service decision: which lands are open to leasing and under what conditions (standard lease terms or added stipulations); and which lands are closed through exercise of management direction, statute, regulation, or withdrawal EOI's on a regular and recurring basis.

Paragraph (d) clarifies the effect of a leasing consent decision.

Paragraph (e) of the rule codifies the existing practice that the Forest Service could withdraw its consent decision prior to a BLM lease sale.

Paragraph (e) emphasizes any additional environmental analysis to be conducted of the leasing consent analysis decision. Environmental analysis will be consistent with leasing analysis and consent decision and conducted in an expeditious manner.

The addition of paragraph (f) is described above.

After considering public comment, the language in the final rule is the same as in the proposed rule.

Compared to the existing regulation, the final rule adds direct reference regarding the applicability of procedures in 43 CFR part 3170, subpart 3171 for requesting waivers or exceptions from or modifications to a lease stipulation (see regulation text in section 228.104). The final rule directs the Forest Service to provide notice to the BLM on its determination as to whether to grant or deny a request for a waiver, exception, or modification. The existing regulation directs notification to both the BLM and operator. As the administrator of Federal leases, the appropriate notification to the operator is from the BLM. The final rule removes statements concerning administrative “appeal” regulations that are obsolete in light of subsequent statutory and regulatory changes, and rather than providing redundant regulatory instructions, the final rule will instead rely directly on the Agency's existing administrative review regulations at 36 CFR part 214 and part 218.

The existing regulation requires the Forest Service to consult with other agencies when considering a waiver, exception, or modification to a lease stipulation included at the other agency's request. Examples of instances when this might occur would be if the Forest Service included a stipulation that restricted occupancy in the vicinity of an electrical transmission line operated by a Federal power authority, or a stipulation to protect threatened or endangered wildlife species required by the U.S. Fish and Wildlife Service. The final rule maintains this requirement unchanged from the proposed rule.

After consideration of public comments, three minor changes were made from the proposed rule to the final rule.

First, in section 228.105(a), the phrase “and avoids conflicts with other land uses” was added to the general standard of resource protection. The clause in section 228.105(a)(1)(vii) “. . . as required by the authorized Forest Service officer” was removed as unnecessary in the final rule.

Finally, the text in section 228.105(c) was modified to specify that an operator must allow access to “authorized” Forest Service personnel and remove the restriction that access is only related to inspection purposes.

The final rule moves the content of the existing section 228.105 to section 228.102. The final rule moves the content of the existing section 228.108 to section 228.105 and retitles it as Responsibilities of Operators. To improve efficient implementation of the regulations, the final rule generally revises the content to not duplicate requirements in 43 CFR part 3170, subpart 3171; readers are referred to 43 CFR part 3170, subpart 3171, as applicable.

The final rule retains requirements from the existing regulations in paragraphs (g), (i), and (j)(2), places them in paragraph (a), and reorders them for readability. Paragraph (a) of the final rule reinforces existing practices for operators to maximize use of existing roads and utility corridors in planning and constructing new infrastructure and report to the Forest Service any spills, blowouts, fires, or personal injuries that are reported to the BLM under its requirements.

Paragraph (b) of the final rule requires the operator to comply with all other applicable State and Federal statutes and regulations. Paragraph (c) of the final rule requires the operator to allow the Forest Service access to its operations for compliance inspection and other authorized purposes. Paragraph (d) of the final rule informs the operator of existing requirements that it is responsible for obtaining Forest Service permits for uses of National Forest System lands and resources not otherwise included in a surface use plan of operation, most notably for uses outside an operator's lease area. Paragraph (e) of the final rule maintains the requirement that the operator shall conduct its activities in a manner that avoids the cause, or minimizes the spread, of fire.

The final rule moves section 228.110 in the existing regulation to paragraph (f) of this section and retitles it Liability. The final rule maintains the same conditions of liability to the United States for injury, loss, or damage, including fire suppression costs incurred by the government resulting from the operator and all lessees' activities.

No changes were made from the proposed rule to the final rule except for changing reference of Onshore Order 1 to 43 CFR part 3170, subpart 3171.Compared to the existing regulation, the final rule revises language clarifying the applicability of the requirements in 43 CFR part 3170, subpart 3171 when an operator submits a surface use plan of operation and addresses use of master development plans and master surface use plans of operations. The final rule revises paragraph (c) to emphasize the need for operators to include in their applications a description of infrastructure or facilities to the extent known that would be used to support their operations such as pipelines or roads, and whether it would be within the boundaries of a lease or agreement, or outside lease or agreement boundaries. The final rule removes paragraph (d) Supplemental Plan, which uses terminology that is inconsistent with the BLM regulations and instead addresses sundry notices in section 228.108.

After consideration of public comments, a change was made from the proposed rule to the final rule. The proposed rule removed the language from 228.107(c) in the existing regulation, which states, “The authorized Forest Service officer shall give public notice of the decision on a surface use plan of operations and include in the notice that the decision is subject to appeal under 36 CFR part 214 or 215.” The final rule inserts language in 228.107(b) expressly addressing when objection and appeal regulations will be available for proposed and final decisions concerning surface use plans of operations. Language has been added in 228.107(b) identifying that the authorized Forest Service officer will provide public notice for the proposed decision on a surface use plan of operation expected to be documented in a decision notice or record of decision ( i.e., environmental assessments and environmental impact statements; not categorical exclusions) and identify that the proposed decision will be subject to the 36 CFR part 218 pre decisional objection process. Additionally, 228.107(e) Notice of decision now provides that “The authorized Forest Service officer shall give public notice of the final decision on a surface use plan of operations and identify in the notice that the decision may only be appealed by the applicant under 36 CFR part 214.”

Compared to the existing regulation, the final rule improves references to 43 CFR part 3170, subpart 3171, including the timeframes established in the regulation for Agency response. The final rule removes existing section 228.107(e), which uses terminology that is inconsistent with the BLM's regulations and instead clarifies sundry notices in section 228.108.

Public comments prompted us to look closely at the language in this section. The final rule makes some minor changes to place language in the correct paragraph and improve clarity.

Compared to the existing regulation, the final rule moves the content of the existing section 228.108 to section 228.105, Responsibilities of Operators. The final rule renames this section Sundry Notices, replacing references to supplemental plans in sections 228.106 and 228.107 of the existing regulations. This removes language inconsistent with the BLM regulations and aligns the final rule with the BLM's procedures. New content regarding sundry notices states that the operator must follow the BLM procedures for submitting a sundry notice and that Forest Service approval of a sundry notice is required if the notice proposes surface-disturbing activities. The final rule clarifies that surface-disturbing activities may or may not require additional environmental analysis and may be assessed using any of the mechanisms provided in the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq. ).

The final rule language remains the same as the proposed rule after consideration of public comments. The final rule maintains the same bond requirement as the existing rule but provides additional instruction to Forest Service managers and operators regarding 43 CFR part 3170, subpart 3171. The final rule makes general clarifications and editorial corrections for readability. The final rule clarifies how the Forest Service will coordinate with the BLM if an operator chooses to increase its BLM bond to cover additional bonding required by the Forest Service for surface reclamation purposes. The Forest Service's experience in managing Federal oil and gas resources since the existing regulations were promulgated in 1990 indicates that in many cases, the BLM lease bonds are insufficient to support surface reclamation needs if a lessee or operator defaults. Recently, the BLM has updated its regulations concerning bonding requirements for leasing, development, and production to address shortcomings identified in reports by the Government Accountability Office and the Department of the Interior's Office of Inspector General (see 89 FR 30916). The final rule retains language for the Forest Service to exercise its authority under the Mineral Leasing Act to ensure adequate financial assurance is in place to reclaim surface disturbance. The final rule adds language that describes what factors authorized Forest Service officers would consider when determining if BLM lease bonds are adequate. The final rule retains language to the effect that the operator may increase the BLM performance bond or post a separate surface reclamation bond with the Forest Service when the Forest Service determines additional bonding is necessary. The final rule adds paragraph (d) to clarify methods for posting bonds, and paragraph (e) to clarify methods for releasing a Forest Service-held surface reclamation bond.

Compared to the proposed rule, the final rule changes language in 228.110(b) Interim measures from “The authorized Forest Service officer may require the operator to take reasonable interim reclamation or erosion control measures to protect . . .” to “The authorized Forest Service officer shall require, as necessary, the operator to take reasonable interim reclamation or erosion control measures to protect . . .”

Compared to the existing regulation, the final rule moves the content of the existing section 228.110 to paragraph (f) of section 228.105, Responsibilities of Operators, and renames it Liability. The final rule places the content from the existing section 228.111 into this section. The final rule also makes editorial clarifications.

The final rule language remains the same as the proposed rule. Compared to the existing regulation, the final rule moves the content of the existing section 228.112, paragraph (c), to section 228.105(b) Responsibilities of Operators and simplifies it to reference Compliance with Other Statutes. The final rule places the remaining content of the existing section 228.112 into this section. The final rule also reorders and renames the paragraphs in this section and makes editorial corrections to clarify the Agency's responsibility to inspect operations for compliance with the terms of applicable approvals and the regulations in this subpart.

The final rule remains largely the same as the proposed rule for this section. In section (f) Shut down of operations, paragraphs (1) and (2) are changed in order. Also, the criteria for lifting a shutdown are simplified to a determination that operations are in compliance with the applicable requirements identified in the notice of noncompliance. The duplicative clause “or that it is no longer likely that any remaining noncompliance is likely to result in danger to public health or safety or in irreparable resource damage” was removed. This second clause is one of the criteria for issuing the shutdown in the first place.

The final rule moves the content of the existing section 228.112 to section 228.111. The final rule also moves the content of the existing section 228.113 to this section. The final rule then reorders, renames, and revises the paragraphs in this section. The final rule streamlines the procedures that the Agency would use to notify an operator of issues concerning noncompliance with the terms of approvals or the regulations in this subpart. The final rule accomplishes the improved efficiency by moving from a two-step process to a one-step process. The final rule clarifies when the Agency would either engage the BLM to act under 43 CFR part 3163, refer a noncompliance action to law enforcement, or refer a noncompliance issue to the Agency's material noncompliance proceedings. The final rule clarifies an operator's opportunity to correct issues of noncompliance and an operator's appeal opportunities. The final rule updates the methods for notifying operators of noncompliance issues by including electronic means of notification.

Except for paragraph (c) Notifying the Bureau of Land Management, the final rule language in this section remains the same as the proposed rule. In paragraph (c), the language “advising the BLM not to issue a lease or approve the assignment of any lease to an entity the Forest Service has determined to be in material noncompliance” was removed. The final rule simply requires notification to the BLM of our findings. By statute, the BLM administers all questions concerning the ineligibility of an entity to acquire a new lease.

The final rule moves the content of the existing section to section 228.112 and moves the content of section 228.114 to this section. The final rule revises, reorders, and renames the paragraphs in this section. The final rule streamlines the procedures that the Agency would follow when determining if an operator is in material noncompliance with reclamation or other requirements or standards and better reflects the requirements and consequences established in the Mineral Leasing Act. The 1990 procedures in the existing regulation for oil and gas material noncompliance proceedings were designed to be consistent with other debarment procedures that are now defunct, thus prompting the need to revise these procedures.

The Posting Requirements text remains the same from the proposed to final rule. The final rule moves the content of the existing section 228.114 to section 228.113; moves the content of section 228.115 to section 228.114; retitles this section; and revises it to make the timeframes consistent with the timeframes in the BLM's 43 CFR subpart 3171. The final rule also removes internal direction regarding posting decisions, which is addressed in the Agency's regulations for implementing the National Environmental Policy Act.

The final rule language is the same as the proposed rule for Information Collection Requirements. The final rule moves the content of the existing section 228.116 to section 228.115 and retitles it Information Collection Requirements. The final rule includes statements regarding Office of Management and Budget requirements from the existing section 228.116.

A summary of substantive comments and Forest Service responses is provided below including descriptions of changes made to the final rule based on the analysis of the comments and other administrative considerations.

1. Comment: Commenters stated the rulemaking process should be paused (or the comment period extended) due to COVID-19 pandemic impeding the ability for public participation, and that all open public comment periods and associated leasing and permitting activities are paused during this crisis.

Agency Response: COVID-19 presented challenges to many normal processes. However, the Forest Service declined to extend the public comment period because the proposed revisions are not complex, and do not materially change the existing analyses and decisions related to land use or post-lease permitting. The Forest Service did extend the Tribal consultation period from 120 days to 150 days. Any ongoing leasing and permitting actions are separate and apart from this rulemaking process.

2. Comment: Several commenters indicate that the programmatic environmental assessment (EA) associated with the proposed rule does not consider a sufficient range of alternatives, and that additional alternatives capable of meeting the purpose and need should be carried forward for analysis. Likewise, concern is expressed that the purpose and need is defined too narrowly to permit consideration of a reasonable range of alternatives. Comments also express concern that the programmatic environmental assessment does not take a hard look at the environmental and social costs associated with the proposed rule, and that additional evidence is needed to support the assessment's findings, as well as the stated purpose and need. It is stated that the Forest Service should prepare an environmental impact statement for the proposed rule to address these concerns.

Agency Response: A programmatic environmental assessment was prepared to determine whether this rule would have a significant impact on the quality of the human environment under the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq. ). The programmatic environmental assessment describes and analyzes two alternatives: the rule (proposed action) and continuing with the existing regulations (no action). The programmatic environmental assessment found no impacts on any natural or cultural resources and low, but beneficial socioeconomic benefits. The programmatic environmental assessment supports a finding of no significant impact for the rule, and preparation of an environmental impact statement pursuant to the National Environmental Policy Act is not required.

3. Comment: With regard to public involvement, some comments stated that the overall structure and style of the proposed rule reduces the public's ability to meaningfully engage in the rulemaking process. Concern is specifically expressed that this will curtail involvement by affected communities and indigenous people or affect decisions for specific public resources.

Agency Response: The process provided adequate opportunity for meaningful public and Tribal engagement as described in the preceding section titled “Advance Notice of Proposed Rulemaking, Proposed Rule, and Public Comment Period.” The proposed revisions are not overly complex, and do not materially change the existing analyses and decisions related to land use or post-lease permitting. Formal consultation and coordination with Indian Tribal governments was conducted as described in the “Regulatory Certifications” section of this preamble.

4. Comment: Concern is expressed that the proposed rule does not address training and funding for Agency staff and programs. As one commenter states, “Creating efficient processes is about more than revising regulations. Without sufficient funding and qualified resource professionals, streamlining regulations is a reaction to symptoms instead of addressing the root causes. Congress and the Administration must address proper funding, to not only ensure healthier forests, but a healthier Forest Service.”

Agency Response: The rule does not address training and funding for Agency staff and programs, and any shortcomings in this area are best addressed outside the context of this rulemaking process. Management of Federal oil and gas resources on National Forest System lands does require an adequate number of qualified resource professionals, and the Service does strive to maintain the required staff.

5. Comment: Many commenters viewed the proposed rule's removal of existing references and citations of required laws, such as the National Environmental Policy Act or the Endangered Species Act, in several places as reducing transparency and the ability for public participation in Forest Service decisions on lands available for leasing and approvals of post-leasing activities. For example, one commenter stated, “I am protesting the new rule that allows speedier approval of oil and gas drilling in national forests. I believe that the new rule unfairly reduces the chance for the public to comment by eliminating much of the existing NEPA process.”

Agency Response: The proposed revisions do not affect the level of notifications or public involvement in leasing or post leasing activities. In several places, references or citations to mandatory laws or regulations were removed in favor of letting them speak for themselves and to reduce likelihood that direction could be confused in the future if those laws or regulations change. While several citations to specific laws and regulations have been removed, the Forest Service and lessees must still comply with all applicable laws and regulations.

6. Comment: Many comments include statements of general opposition for the proposed rule, as well as for oil and gas activities on National Forest System lands or in general. Stated reasons for resource-specific opposition include adverse consequences to varied biological resources such as ecosystem health or wildlife, inadequate economic benefits and protection of human and environmental health, inappropriate use of public lands, adverse impacts on recreation opportunities and tourism, air and water pollution, decreased carbon sequestration and increased global warming/climate change impacts (including wildfires/fire risk, storms, and sea level rise), traffic, increased noise, and viewshed changes (such as views of natural gas flaring), damage to cultural and Tribal resources, and loss of medicinal plants.

Agency Response: The changes from the existing regulation do not alter the high level of protection of natural and cultural resources and other land uses affected by impacts of oil and gas development. The existing regulation is administrative in nature. It does not make any land use decisions or authorize any on-the-ground activity. The same holds true for the final rule. The rule does not change any processes by which the Forest Service complies with the National Environmental Policy Act, Endangered Species Act, cultural laws, or interagency and Tribal consultations in making decisions on land uses, leasing conditions, or post-leasing surface use decisions. The programmatic environmental assessment and regulatory impact analysis along with the preamble to the draft rule, are essential components of our open and transparent public review process. A review of the documents demonstrates that the proposed revisions are not highly complex, do not materially change the existing analyses and decisions related to land use or post-lease permitting, have no adverse impacts on any members of the public, and do not alter public ability to participate in these decision-making processes.

7. Comment: Many commenters stated reasons for general support of the proposed rule revisions, including efforts to “reduce the burden of Federal regulations on individuals and businesses, increase efficiency, streamline processes, clarify the rule to reduce confusion and the potential for litigation and promote consistency between agencies all while maintaining health, safety and environmental protections.”

Agency Response: These are the stated reasons why the Forest Service decided to undertake the rulemaking effort. In general, the existing rule does not impose undue burdens on the industry but the Forest Service recognizes the value of providing clarity and improving processes and consistency between agencies.

8. Comment: Support is expressed for language that clarifies the roles of the Forest Service and the BLM in administering mineral leasing on National Forest System lands. Comments also state that the proposed rule should (1) regulate development of split-estate lands (such as nonfederal (reserved and outstanding private)) oil and gas resources, and the opposite (2) ensure that this rulemaking only affects Federal oil and gas resources on land managed by the Forest Service and does not affect nonfederal oil and gas resources.

Agency Response: The existing regulation and final regulation apply only to management of Federal oil and gas resources. The exercise of private oil and gas rights beneath lands managed by the Forest Service occurs under a different umbrella of laws and policy. Attempting to combine the different regimes under one regulation would likely promote inefficiencies and less clarity.

9. Comment: For section 228.100(b), one commenter stated, “The Reform act gives the Secretary of Agriculture authority to regulate all surface-disturbing activities conducted pursuant to a lease and does not specify those activities must be “on the lease” and suggested changing “within such leases” to “pursuant to such leases.” The commenter suggested that surface uses associated with oil and gas activities that are conducted on lands managed by the Forest Service outside a lease or agreement should be covered under one authorization, namely the surface use plan of operations.

Agency Response: As described in section 228.100(c)(3), surface uses outside a Federal lease or agreement are subject to Forest Service special uses authorizations under regulations set forth elsewhere in 36 CFR chapter II, including but not limited to the regulations set forth in 36 CFR part 251, subpart B, and 36 CFR part 261. The Forest Service could not identify any meaningful efficiencies for the Forest Service or industry that would be gained by trying to combine authorizations permitted under different authorities, different Forest Service personnel or offices, or varying from long-standing processes.

10. Comment: Comments request that for “conditions of approval,” remove the “may be” or “may” language and instead provide specific, required conditions.

Agency Response: The definition has been adjusted to remove language that may imply arbitrary discretion in application of conditions of approval.

11. Comment: One commenter viewed the definition of “consent” as reversing the existing requirement that forest staff make an affirmative decision following any leasing analysis. The commenter interprets the final rule's definition of “consent” under both the Mineral Leasing Act of 1920 (may not issue a lease “over the objection” of USDA) and the Mineral Leasing Act for Acquired Lands of 1947 (no covered mineral deposit “shall be leased except with the consent” of the agency) as demoting the Forest Service to a weak, secondary role relative to oil and gas leasing on public domain lands. Other commenters stated the definition would eliminate or reduce confusion by the public relative to use of the different terminology. Combining implementation of two separate authorities under one common terminology improves efficiency and reduces complexity.

Agency Response: Regardless of whether a leasing analysis is conducted for reserved public domain or acquired lands, the Forest Service conducts the same analysis and effectively makes the same decisions: what lands are unavailable for lease, what lands are available, and under what conditions (such as lease stipulations). The “consent” and “does not object” language conveying the Forest Service's decision to the BLM has the exact same effect. That is made clearer with the “consent” definition in the proposed rule.

12. Comment: One commenter recommended the rule include a definition of “reclamation” as the term is used frequently in the proposed rule, but never explicitly defined.

Agency Response: No specific definition has been added for “reclamation.” The agencies, industry and public have a sufficient understanding of its general meaning without providing a more precise definition that could inadvertently overlook or exclude needed flexibility for specific reclamation actions. What constitutes reclamation is determined on a site-by-site case in the “reclamation plan” of a surface use plan of operations, which is also used to evaluate the amount of a reclamation bond.

13. Comment: It would seem advisable that if the authorized Forest Service officer issues a specific Notice to Lessees and Operators that that information should also be forwarded to the appropriate BLM office also, usually the jurisdictional State office.

Agency Response: The agency agrees and has adjusted the final rule to ensure proper notifications occur.

14. Comment: The proposed rule would remove references to other laws and regulatory requirements, particularly with respect to complying with the National Environmental Policy Act and the Endangered Species Act and their implementing regulations, in favor of letting those laws and regulations speak for themselves. By removing information such as this, it weakens the public's confidence in knowing what the oil and gas industry is doing and to what regulatory measures they are being held.

Agency Response: Reference and citation of mandatory laws were removed in favor of letting those laws and regulations speak for themselves and to reduce likelihood that direction could be confused in the future if other regulations change. While several citations to specific laws and regulations have been removed, the Forest Service and lessees must still comply with all applicable laws and regulations.

15. Comment: In addition to the BLM, one commenter requested that State wildlife agencies also be identified and invited to participate as a cooperating agency in the leasing consent analysis due to special expertise or statutory authorities.

Agency Response: Although State wildlife agencies and other agencies with resource responsibilities are often identified and invited to participate, mandating invitations would not be an appropriate regulatory requirement. The BLM's role as the final authority over oil and gas leasing matters on Federal lands distinguishes their participation and warrants a regulatory requirement to receive an invitation to be a cooperator in the environmental review process. The Forest Service will continue to coordinate and cooperate with other Federal and State agencies as appropriate.

16. Comment: One commenter observed that the justification for the change to clarify “how stipulations must be designed to carry out provisions of the Energy Policy Act of 2005” is questionable. Notably, the requirement of the Energy Policy Act of 2005 was for the BLM and Forest Service to enter into memorandums of understanding concerning oil and gas leasing and operations—nothing more. The commenter believes that this requirement has been met and in no way does the Energy Policy Act of 2005 require the Forest Service regulations to incorporate this direction.

Agency Response: Though the commenter is technically correct that the Energy Policy Act does not “require” the Forest Service to include specific language in regulation, the concept that lease stipulations are consistently applied and coordinated between agencies and only as restrictive as necessary to protect the resource or resources for which the stipulations are applied is entirely reasonable and fully protective of resources. USDA has elected to maintain the provision in regulation because it informs Forest Service managers of the need to cooperate and develop stipulations that fully provide necessary protections but avoid restrictions that only serve to make leases less economically attractive.

17. Comment: Relating to the “Effect of leasing consent decision,” commenters challenged the Forest Service proposed rule that states, “An authorized Forest Service officer's identification of lands as open to leasing . . . does [not] constitute an irretrievable or irreversible commitment of resources.”

Agency Response: The Forest Service consent decision does not necessarily lead to leasing as that decision and action belongs to the BLM. Further, the Forest Service may withdraw its consent at any time prior to a lease sale.

18. Comments: On the topic of the proposed rule's removal of language from the existing regulation for “Leasing Decisions for Specific Lands,” this proposed change generated the highest number of topic-specific comments—mostly unfavorable. Commenters asserted the Forest Service was eliminating a step requiring environmental review under the NEPA and additional public participation, ceding Forest Service authority to the BLM and placing oil and gas leasing above any environmental considerations. A few commenters stated removing the language would help avoid confusion by the public as to exactly what the current provision was calling for and thus avoid unnecessary legal challenges.

Agency Response: Based on public comment, our attempt to refine and clarify a single Forest Service decision point and avoid confusion was not successful. The draft rule attempted to clarify that the Forest Service would make a single decision identifying available lands for which the Agency would provide consent to the BLM to offering oil and gas leases for sale. The decision was to occur following a forest or area-wide leasing analysis. It is notable that the existing regulation actually uses the word “decision” in the paragraph titled “Leasing decisions for specific lands” (36 CFR 228.102(e)). However, when considering what the existing regulation requires, it is readily apparent that this is not a second, independent decision or Federal action requiring a more detailed analysis, but rather has been regarded as an administrative review verifying that leasing of the specific lands being reviewed has been adequately addressed in a NEPA document and is consistent with the applicable land management plan. The draft rule removed this regulatory text because it duplicates other procedures and regulatory requirements. That is, the Forest Service inevitably sought to assure that NEPA and other Forest Service regulations and policy remained valid at the time specific tracts were included in a lease sale. Removal of the text seemed to create more confusion. As a result, the final rule includes new text titled “Review of Leasing Consent Decision for Specific Lands” with the review leading to either a confirmation of the leasing consent decision or a withdrawal of consent (based on new information necessitating further analysis, for example). Additional direction was added for the Forest Service to provide notification to the BLM of results of the review confirming the leasing consent decision for specific lands or withdrawing its leasing consent for specific parcels. If the consent is withdrawn, the notification will describe the reasons for the withdrawal and provide an anticipated course of action.

19. Comments: Several commenters expressed concern that the Forest Service might withdraw its consent any time prior to a BLM lease sale, with some suggesting there should be a specified timeframe prior to a lease sale citing prospective bidders expending time and money evaluating parcels.

Agency Response: After consideration, the final rule removes section 228.103(e)— Withdrawing lease consent. The provision was added to the draft rule with the removal of existing 228.102(e)— Leasing decision for specific lands from the draft rule. The time between Forest Service leasing consent and an actual lease sale could be a number of years and conditions could change. A provision of the Forest Service's ability to withdraw its consent for specific parcels was informative to Forest Service and BLM, industry, and the public. The time between a notice from the BLM to the Forest Service that Forest Service parcels are scheduled for a lease sale is typically a month to several months. The Forest Service retains the discretion to withdraw its consent prior to a lease sale.

20. Comment: Commenters expressed support allowing the Forest Service discretion to provide waivers, exceptions, or modifications to lease stipulations identified in section 228.104. Governments on Colorado's Western Slope argued in other rulemaking processes, that one size does not fit all, and this will allow the Forest Service to adjust accordingly.

Agency Response: The Department agrees that this longstanding procedure is a valuable tool in oil and gas leasing administration. To ensure adequate protection is maintained, if the activity would cause effects on surface resources not authorized by the currently approved surface use plan of operations, the sundry notice is subject to the same requirements of sections 228.106 and 228.107.

21. Comment: Comments suggested that section 228.103 Leasing Consent Analysis should identify the conditions that could lead to a waiver, exception, or modification for each stipulation.

Agency Response: After consideration, it was determined that this section as proposed provides the appropriate criteria for the Forest Service to consider waivers, exceptions, or modifications to lease stipulations, and that speculating on specific conditions for each stipulation during the leasing analysis is not always practical. This section provides a reasonable adaptive management tool.

22. Comment: Some commenters expressed concern that waivers, exceptions, or modifications could be approved without analysis and believed the section should explicitly define a public comment period requirement.

Agency Response: Any stipulation contained in a Forest Service lease has undergone full analysis including public participation. The rule defines strict criteria for approval that cannot lower the level of resource protection, including a review of the environmental consequences. Specifically, a Forest Service officer must find the management objectives which led the Forest Service to require the inclusion of the stipulation in the lease can be met if the waiver, exception, or modification is granted. Also, if a lease stipulation was included in a Forest Service lease at the request of another agency, or if another agency has specific jurisdiction over the specific resource, the authorized Forest Service officer must coordinate with that agency prior to approving a waiver, exception, or modification. These provisions provide the necessary protections and a universal requirement for public participation is not included in the final rule.

23. Comment: In section 228.104 (d) Coordination with other agencies, the Rule specifies that if non-Forest Service agency-proposed stipulations were incorporated into a lease, the Forest Service shall coordinate with the agency prior to approving a waiver, exception, or modification of those stipulations. However, this provision does not require the consent of the agency to modify stipulations. This provision could negate lease stipulations requested by the agency such as seasonal timing restrictions of drilling within big game critical winter range, fawning or calving habitat and the agency would have little recourse to challenge such decisions.

Agency Response: The final regulation does require the consent of such an agency to the waiver, exception, or modification when such consent is independently required by statute or regulation. But even given that, for the stipulation to have been included in the lease at an agency's request suggests a genuine and effective level of cooperation, and the rule requires (for example, Forest Service officer shall coordinate . . .) further coordination as the Forest Service considers the request. However, when an agency does not have statutory or regulatory authority, the regulation recognizes the final decision as being with the Forest Service. Agencies do not have the ability to pursue predecisional objections concerning proposed Forest Service decisions under 36 CFR part 218.

24. Comment: A commenter requested that the proposed amendments to section 228.104 be expanded to provide for waivers, exceptions, or modifications of lease stipulations to recognize North Dakota section line rights of way (NDCC 24-07-03) on lands acquired by the United States obtained by deed through purchase or gift, or through condemnation proceedings after North Dakota statehood in 1889.

Agency Response: Development of stipulations during the leasing analysis will conform with the legal obligations of the United States, but state specific matters such as the one raised by the comment are best addressed on a case-by-case basis rather than through these nationwide regulations.

25. Comment: A commenter stated the change to only notify the BLM of the Forest Service decision, and not the operator, would limit Forest Service decision making.

Agency Response: Section 228.104(a)(2) clarifies that where the request involves stipulations included in the lease as prescribed by the Forest Service, the BLM must obtain approval from the Forest Service before granting a request for a waiver, exception, or modification. An operator is directed to submit its request to the BLM under 43 CFR part 3170, subpart 3171.24, and the BLM is the final decision maker on the request. The notification to the operator by only the BLM promotes efficiency and does not change Forest Service evaluation of the request or limit its decision-making authority.

26. Comment: Consider changing “required” to “approved” so that it reads “. . . as approved by the authorized Forest Service officer.” Based on “Superfund” litigation relative to phosphate mining in Idaho where the Forest Service required specific reclamation . . . which resulted in a Comprehensive Environmental Response, Compensation, and Liability Act (Superfund) action . . . it was argued that the Forest Service was liable since they “required” the specific reclamation causing the problem. The operator should propose reclamation which would be approved by the Forest Service and thereby limiting potential taxpayer liability.

Agency Response: The clause in section 228.105(a)(1)(vii) “. . . as required by the authorized Forest Service officer” appears to be unnecessary and it has been removed from the final rule.

27. Comment: A commenter takes exception to section 228.104(c) which states that the operator must allow Forest Service employees access, for inspection purposes stating that if the Forest Service employee is not certified (Forest Service Manual 2893) and/or does not have proper equipment, the operator may deny access to meet their “safety obligation” as referenced in 228.105(e). The commenter references Occupational Safety and Health Administration requiring personnel on location to wear flame-resistant clothing at specified times and references National Forest System Deputy Chief's letter dated November 15, 2010.

Agency Response: The Department partially agrees. After consideration, the text has been modified to specify that an operator must allow access to “authorized” Forest Service personnel and has removed the restriction that access is only related to inspection purposes. Forest Service personnel may need to be on location for other purposes such as planning new operations. While operators cannot ultimately deny access to authorized Forest Service personnel, conditions that provide for human health and safety should be in place.

28. Comment: Another commenter noted that there is no mention of or reference to potential investigations by other enforcement entities including State law enforcement officers or staff being permitted access. This limitation could impede the State's ability to investigate reports or clarify questions concerning wildlife or habitat related issues.

Agency Response: If access by State agencies is required under their own or other authorities, then it is not necessary to include language to that effect in this regulation. The Forest Service is committed to cooperating with State agencies to ensure that operations are conducted in compliance with all Federal, State, and local laws and regulations.

29. Comment: One comment noted language indicating that the operator will “reshape and revegetate areas disturbed by their operations” is not clear what area that constitutes. It appears that the paragraph leaves that decision up to the operator. If the intent is that this refers to the surface use plan of operation, the regulations should so state; if not, then the area(s) should be defined.

Agency Response: After considering the comment, that language in the final rule remains the same as the proposed rule. This accounts for both approved and unapproved disturbance (such as spills that move off a surface use plan of operation's approved area of disturbance).

30. Comment: A commenter recommends this section be further clarified by adding language that directs the operator to conduct activities (or develop best management practices) in a manner that avoids and minimizes effects to all wildlife, regardless of designation. Actions such as identifying opportunities to minimize potential wildlife/vehicle collisions, presence of wildlife on sites due to water or lighting are examples which would also improve site safety for operators and their employees. Further, since Forest Service lands are designated for multiple use, the commenter further recommends language or practices that avoid and/or minimize impacts on public recreation (or access to), namely wildlife related recreation (such as hunting, angling and wildlife watching) as a result of the activities.

Agency Response: The Forest Service prefers language that is inclusive of all natural and cultural resources rather than calling out specific ones, such as wildlife. The words “conflicts with other land uses” has been added to clarify that the Forest Service considers these effects on land management as well as environmental impacts.

31. Comment: Comments express support for the requirement for operators to include planned infrastructure or facilities in their surface use plan of operations, including those located outside of lease or agreement boundaries.

Agency Response: The Department agrees. Though the permitting authorities are different and remain separate, the requirement serves to facilitate compliance with environmental laws such as the National Environmental Policy Act.

32. Comment: A commenter expressed concern that the proposed rule removes existing subsection (d), which requires a supplemental use plan if an operator wants to do something that is not covered by the currently approved plan. The operator instead is directed to comply with sundry notice requirements in section 228.108 which are simpler. However, the proposed rule specifically states these changes are to prevent inconsistency with the BLM regulations. As addressed above, the mission and statutory mandate of the Forest Service is inconsistent with the BLM's mission and statutory mandate. Changes should not be made to Forest Service regulations to more align with an agency whose interests and aims are different than its own.

Agency Response: The term “supplemental use plan” in the existing regulations has the same meaning and function as the term “sundry notice” used in 43 CFR part 3170, subpart 3171 and other relevant the BLM regulations and has not been changed.

33. Comment: A commenter recommends that language in paragraph (b) be modified to also encourage the operator to coordinate with the State wildlife agency concerning local wildlife activities and wildlife recreation resources and uses. The commenter contends that the State wildlife agencies have the best data and information regarding wildlife and wildlife related recreational activities. Other comments state this section implies that there is no requirement to, nor expectation that, the lessee or operator will base a surface use plan on the best available information from the Forest Service nor any other appropriate Federal or State natural resource management agencies. These comments suggest that “encourage” should be “require” instead.

Agency Response: The Department agrees with the premise that an operator's coordination with State agencies responsible for wildlife resources, or any resources, is advisable to ensure the best information available is used to develop its surface use plan of operation. The “encourage” language is consistent with 43 CFR part 3170, subpart 3171 and serves as guidance to the operator for their benefit in avoiding unnecessary delays. A Forest Service regulation directing one agency to cooperate with another is not appropriate and the language has not been changed in the final rule. The Forest Service will continue its current practice of coordinating and consulting with agencies including the sharing of information.

34. Comment: A commenter suggested deleting this section since its primary purpose is for implementing Onshore Order 1 and the section should not duplicate or confuse the regulatory requirements of the Order.

Agency Response: The final rule retains this section as it provides direction that is supplemental to 43 CFR part 3170, subpart 3171.

35. Comment: Comments express opposition to proposed revisions in section 228.107 that would eliminate requirements that the authorized Forest Service officer give public notice of the Forest Service's decision on a surface use plan of operations and include in the notice that the decision is subject to appeal. Other commenters viewed the removal of the Forest Service's notification of decision on the surface use plan of operation as ceding authority to the BLM.

Agency Response. In consideration of the first comment, new language has been added in paragraphs (b) and (e) to the final rule directing the Forest Service officer to give public notice of proposed and final decisions on a surface use plan of operation including the availability of an objection or appeal. The proposed rule in no way diminishes Forest Service's decision-making role. The regulation at 43 CFR part 3170, subpart 3171specifically requires Forest Service approval of the surface use plan of operation before the BLM can approve an application for permit to drill. Additionally, the BLM cannot approve an application for permit to drill until any objection or appeal to the Forest Service of its decision on a surface use plan of operation is resolved.

36. Comment: A commenter stated that the Forest Service must be able to add additional [lease] stipulations or other environmentally protective measures or requirements at the time of review and approval of surface use plan of operations and master surface use plans of operations. This allows the Forest Service to require up-to-date technology or best management practices that will protect public lands and to incorporate into the plans of operations protection for new sensitive species, locations of species, or sensitive ecosystems that have been found since the stipulations were submitted.

Agency Response: There is no process where the BLM can unilaterally add stipulations to a lease once it is issued; except as provided by the lease itself. Otherwise, lease holders must agree to an added stipulation. The leasing process provides considerable protection for various resources before, during, and after the surface use plan of operations review and approval process. First, the Forest Service uses the best available information when making leasing decisions. Second, at the time specific tracts are to be offered for lease, the Forest Service conducts an administrative review of the leasing decision. The review ensures that if there is significant new information or a circumstance that requires additional environmental analysis be conducted, or leasing would not be consistent with the applicable land management plan, the leasing consent would be withdrawn. Finally, once a lease is issued, regardless of the lack of a stipulation, the BLM, Forest Service, and operators are still responsible for compliance with the Endangered Species Act, National Historic Preservation Act, among other environmental laws. Compliance with these and other laws may lead to specific actions that on operator would need to take (or not take) in its conduct of operations.

37. Comment: Comments state that the proposed rule should provide specific language that (1) addresses what surface-disturbing activities must be considered; and (2) provides provisions requiring protection of these resources, including fisheries, wildlife, and plant habitat, and a requirement that the discovery of possible historical or cultural resources be reported to the Agency (as the current rule does at section 228.108(d)), and requirements for protection of habitat for all federally listed and proposed species, and Forest Service sensitive species and species of conservation concern.

Agency Response: As required by 228.108(a), any activities that would cause effects on surface resources would require the Sundry notice to include a surface use plan of operations that is subject to the same Forest Service review and approval. The second part of the comment has been addressed in other responses to comments, including Comment 36.

38. Comment: The proposed rule revises the sundry notices section to grant more authority to the BLM and removes oversight by the Forest Service. Again, the proposed rule changes Forest Service regulations to better align with—or in some instances mirror—the BLM regulations. This grants more authority over the use of forest land to an agency that was not established for the purpose of preserving the health and quality of forests and wildlife.

Agency Response: The “supplemental use plan” in the existing regulation has the same meaning and function as the term “sundry notice” used in the final rule, 43 CFR part 3170, subpart 3171, and other relevant BLM regulations. The final rule's change in terminology from “supplemental use plan” to “sundry notice” and the reorganization for a stand-alone section 228.109 Sundry Notices do not change the roles and responsibilities of the Forest Service or the BLM.

39. Comment: A commenter noted that the bond requirement is covered by Onshore Order 1 and much in this section is “how to” and is more appropriate for a Forest Service Manual or Handbook.

Agency Response: The bonding requirements and procedures in this section are specific to the Forest Service and supplemental to 43 CFR part 3170, subpart 3171 and are responsive to the 1987 Reform Act. No changes have been made to the section from proposed to final rule.

40. Comment: Many form letter comments stated that the proposed rule should require bonds to be posted up front and at sufficient value to cover the full cost of reclamation.

Agency Response: The proposed and final regulation adequately provides for both the bond adequacy and posting requirement prior to ground-disturbing activities.

41. Comment: A commenter suggested that the cessation of operations notification should occur after 30 days, not 45 days, and under (b) the Forest Service must require not “may require” that “interim measures” are implemented to protect public lands.

Agency Response: Operators must notify the Forest Service when it becomes apparent that cessation of operations would last longer than 45 days and that the notification occurs well before operations have actually been ceased for 45 days. The language in paragraph (b) has been modified, changing the “may require” to “shall require as necessary” interim measures to [protect resources] to remove the appearance that the authorize Forest Service officer can make arbitrary decisions regarding protection of resources.

42. Comment: The Forest Service must maintain a robust inspection and compliance regime to protect our resources from oil and gas pollution on Forest Service lands. This proposed rule substantially absolves both the Forest Service and the oil and gas operators from critical aspects of inspections, compliance, and enforcement. Troublingly, proposed new 36 CFR 228.111 removes the existing law's (228.112(c)) directive that operators must also comply with laws other agencies administer. These include many major environmental statutes like the Clean Water Act, Clean Air Act, and the Endangered Species Act, as well as cultural protection and oil and gas leasing laws. While removing this section does not change whether operators must still comply, it signals the Forest Service's intent to help operators who may be noncompliant with other agency statutes.

Agency Response: The Department disagrees with this interpretation. The inspection and compliance protocols in the proposed regulation are clearer, more efficient, and will result in better outcomes. The section has been left largely unchanged from the proposed to final rules. The minor changes that were made are described in the section-by-section discussion of changes from proposed to final rule.

43. Comment: Commenters supported that the proposed rule moves notification of noncompliance “from a two-step process to a one-step process” and supported clarifications to an operator's remedial and appeal rights.

Agency Response: As in our response to the previous comment, the Department expects the inspection and compliance protocols in the proposed regulation will result in better compliance administration.

44. Comment: Comments state that the proposed revisions to section 228.112 should not allow operators to request extensions of compliance deadlines when noncompliance results from factors that are within the operator's control.

Agency Response: Noting that the Forest Service has sole discretion to extend a compliance deadline, the consideration of extension is based on risk of more damage to resources and the logistical ability to correct the noncompliance and not so much on the underlying cause.

45. Comment: Comments state that the Forest Service must be in charge of noncompliance cases.

Agency Response: Forest Service plays an important role in noncompliance issues related to surface uses, but the BLM remains the agency that issues and enforces permits.

46. Comment: Acknowledging that this is a comment related to the Forest Service Manual or Handbook, a commenter suggested that in addition to a notice of noncompliance, a letter of “appreciation for good compliance” should be used as a positive management tool. If fully compliant operations are noticed and acknowledged, it often leads to an exceeding of “basic compliance.” Bragging rights in the oil patch are a large motivator for marginal operators to improve and compete.

Agency Response: The Department agrees that the concept does not belong in this regulation and notes that the majority of operators on National Forest System lands diligently comply with the applicable laws and regulations and conditions of their permits. At times, operators undertake activities not required of them that serve the public's interests.

47. Comment: Comments state that when noncompliance is likely to result in danger to public health or safety or in irreparable resource damage, operations shall be suspended, and the shut down shall remain in effect until operations are in compliance “or it is unlikely that any remaining noncompliance will result in danger to public health, safety, or irreparable resource damage.” The term “or” suggests that an operator may resume operations without fully coming into compliance with the requirements identified in the notice of noncompliance.

Agency Response: The Department has modified text in the final rule to the effect that operations will remain shut down until the applicable requirements identified in the notice of noncompliance have been achieved.

48. Comment: Comments express concern that the proposed rule removes penalties for continued non-compliance and allows for damage without punitive consequences. If operators fail to comply with their surface use plan, the proposed regulation establishes a no-harm-no-foul penalty structure. This structure is devoid of any substantive punitive measure and full of grace for noncompliant operators.

Agency Response: For the very small percentage of noncompliant operators that cannot or will not come into compliance, their continued noncompliance could result in civil and criminal penalties under both the BLM and Forest Service regulations per paragraphs (e)(1) and (2) referrals. The objectives of avoidance of unnecessary impacts and diligent correction of violations that do occur can be achieved without establishing additional punitive measures.

49. Comment: A State agency requested that the State wildlife agency also be notified of noncompliance for matters that have the potential to affect the statutory authority and public trust responsibility to manage wildlife. This could also include noncompliance for matters that have the potential to affect multiple use on Forest Service lands, namely wildlife related recreation (such as hunting, angling, and wildlife watching).

Agency Response: The Forest Service is committed to cooperating with all State agencies to ensure that operations are conducted in compliance with all Federal, State, and local laws and regulations. This cooperation would include engaging State resource specialists when their agencies' authorities or responsibilities are relevant to oil and gas activities on National Forest System lands. The cooperation often occurs in the form of sharing of information and professional opinions.

50. Comment: Comments state that proposed revisions to section 228.113 unduly favor oil and gas by 1) reducing the factors considered in determining material non-compliance, and 2) making materiality determination and compliance referral largely discretionary. Comments also request language in section 228.113(a)(1) to clarify how irreparable resource damage will be addressed.

Agency Response: The 1990 procedures in the existing regulation for oil and gas material noncompliance proceedings were designed to be consistent with other debarment procedures of the agency that are now defunct, thus prompting their replacement. The final rule's procedures are fair, reasonable, and consistent with both Forest Service and BLM policy. The final rule provides clarity to the procedures to be followed for determining if an operator is in material noncompliance with reclamation or other requirements or standards to better reflect the requirements and consequences established in the Mineral Leasing Act. The final rule does not materially change an operator's requirements and responsibilities.

51. Comment: Referring to section 228.113 (c), in cases of material noncompliance, “the Forest Service shall advise the BLM not to issue or approve the assignment of any lease to the entity determined to be in material noncompliance,” a commenter suggested the proposed rule should be modified to clarify that this advisement is binding until the operator comes into compliance. Additionally, relating to section 228.113 (c) and (d), the commenter suggested a minimum time period should be applied during which the operating entity may not be approved for a lease, regardless of when they come back into compliance.

Agency Response: The comment prompted us to review the language of the paragraph. The final rule removes the “advise” language and simply requires the Forest Service to notify the BLM of its findings. Per statute, the BLM administers the ineligibility of an entity to acquire a new lease. Notably, section 17(g) of the Mineral Leasing Act of 1920 as amended (MLA), 30 U.S.C. 226(g), provides: “The Secretary shall not issue a lease or leases or approve the assignment of any lease or leases under the terms of this section to any person, association, corporation, or any subsidiary, affiliate, or person controlled by or under common control with such person, association, or corporation, during any period in which, as determined by the Secretary of the Interior or Secretary of Agriculture, such entity has failed or refused to comply in any material respect with the reclamation requirements and other standards established under this section for any prior lease to which such requirements and standards applied.” For the second part of the comment, the “minimum time period” suggestion appears punitive and unnecessary as discussed in our response to comment 48.-.

52. Comment: The proposed posting requirements will no longer provide direction about posting decisions. The Agency's explanation is that the National Environmental Policy Act regulations direct that action. Again, this is a situation where the Agency removes a required internal procedure in favor of meeting the bare minimum required by the National Environmental Policy Act.

Agency Response: Changes to the minimum posting durations are in alignment with BLM's processes. The Department anticipates that the public will not perceive any reduction of notifications concerning these actions or the ability to engage with the Forest Service.

53. Comment: USDA requested comments on whether the proposed rule would lessen the burden of collecting and reporting information and data as advocated by the Paperwork Reduction Act of 1995. Industry commenters generally appeared to believe that aligning Forest Service oil and gas leasing regulations with BLM regulations, as proposed, should decrease the paperwork burdens on lessees, operators and small businesses in the oil and gas industry.

Agency Response: The Department expects there to be some efficiencies gained, though small and unquantifiable.

This final rule makes minor, non-substantive changes to two other regulations for purposes of conforming with the modifications being made to 36 CFR part 228, subpart E.

In 36 CFR 214.4(b)(3), the phrase “request to supplement a surface use plan of operation” is changed to “requests concerning the surface use portion of a sundry notice” to track language in the final rule. The final rule also adds two additional appealable decisions: (1) requests for a waiver or exemption from, or modification to, an oil and gas lease stipulation, and (2) requests for an extension of the time period for taking action in response to a notice of noncompliance.

In 36 CFR 261.2, which includes definitions applicable to the Agency's law enforcement regulations, the definition of “operating plan” is changed by replacing the phrase “supplemental surface use plan of operation” with “surface use portion of a sundry notice.”

Executive Order (E.O.) 12866 provides that the Office of Information and Regulatory Affairs in the Office of Management and Budget (OMB) will review all significant regulatory actions. The Office of Information and Regulatory Affairs has determined that this rule is significant pursuant to section 3(f) of E.O. 12866. Therefore, a regulatory impact analysis analyzing the costs and benefits of the proposed regulation was needed to comply with E.O. 12866. The potential benefits and costs, as well as distributional impacts, associated with the proposed rule were analyzed to fulfill the regulatory impact analysis requirements, consistent with E.O.12866 and OMB Circular A-4.

The regulatory impact analysis considers costs and benefits associated with updates, modifications, or clarifications to different sections of 36 CFR part 228, subpart E, as they relate to key procedural steps for oil and gas leasing and permitting on National Forest System lands. Changes in costs and benefits are discussed in a primarily qualitative manner due to the challenges with quantifying costs and benefits at a programmatic level. Quantitative proxies were used when feasible to help describe the potential frequency or magnitude of activities and corresponding costs affected by the proposed rule.

The direct benefits of the proposed rule identified were reduced costs and time spent on identifying available lease areas, approving operations, and addressing compliance actions, including costs and time incurred by the Agency as well as by proponents engaged in or pursuing oil and gas operations on National Forest System lands. Indirect benefits can result from expedited access to leasable oil and gas resources on National Forest System lands, including time-valued oil and gas revenue or returns to operators as well as time-valued bids, lease rentals, and royalties paid by operators to the Federal government and public.

Some operators may have to apply for special use authorizations or pay an administrative fee to mitigate emergency non-compliance situations under the rule; however, these situations are expected to be infrequent or involve relatively small incremental costs. Rule provisions clarifying considerations for establishing bonds that cover the full cost of reclamation, consistent with the existing rule, may result in increases in bonds and increases in operator costs for obtaining financial guarantees (such as surety bonds) to cover incremental bond amounts. The financial risks associated with reclamation default are currently borne by the Agency or public when bonds do not reflect full reclamation costs, implying this rule helps transfer the burden of those financial risks to the operators and administer reclamation in a fiscally responsible manner, consistent with the intent of the existing rule. These analyses are updated using fiscal year 2022 data. The updates do not change the conclusions of the draft rule analysis. The final rule is not expected to have a significant or measurable impact on rates of oil and gas production on National Forest System lands; oil and gas prices and other market factors are likely to drive future changes in growth of development and production. Because of minimal impacts on production, the rule is equally unlikely to have significant distributional impacts on jobs or income contributions from oil and gas activities on National Forest System lands.

The rule is expected to result in positive net benefits. Most provisions of the rule are expected to reduce the times for reviewing and approving leases and permits, thereby saving operator and Agency costs and expediting opportunities for production and revenue. Exceptions might include cases where some operators may have to apply for special use authorizations, pay an administrative fee to mitigate emergency non-compliance situations under the rule, or be faced with increases in reclamation bond amounts. However, these situations are expected to be infrequent, involve relatively small incremental costs, or consist of payments that shift financial risk of reclamation default back to the operators and away from the public, consistent with the intent of the existing rule. The regulatory impact analysis is available with the supporting documents at http://www.regulations.gov.

Executive Order 14192 requires that any new incremental costs associated with significant new regulations “shall, to the extent permitted by law, be offset by the elimination of existing costs associated with at least 10 prior regulations.” This final rule is expected to be deregulatory under E.O. 14192.

Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq. ), 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(2). Findings in the regulatory impact analysis for the rule indicate that it is unlikely to have significant impacts on job or income contributions from oil and gas activities on National Forest System lands. Therefore, the revised regulation is not classified as major.

The rule was reviewed under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. The rule is not expected to have a measurable effect (positive or negative) on oil and/or gas supply or distribution. The Agency regulation does not make decisions about which lands are open or closed to leasing and subsequent development but instead manages the process. The rule streamlines the oil and gas leasing process and clarifies processing procedures for the surface use plan of operation portion of an application for permit to drill on National Forest System lands. The streamlining should reduce time and costs of permitting or leasing.

The rule is not expected to have a significant adverse effect on the supply, distribution, or use of energy; on competition or prices; or on other agency actions related to energy. The rule is not expected to raise novel issues regarding adverse effects on energy. The rule is therefore not expected to be a significant energy action or to require a statement of energy effects, consistent with Office of Management and Budget guidance for implementing Executive Order 13211.

The Agency has reviewed this rule under U.S. Department of Agriculture procedures and Executive Order 13771, issued January 30, 2017. The Office of Management and Budget has reviewed this rule and designated it as significant per Executive Order 12866. Executive Order 13771 requires that agencies account for the incurred costs that a significant regulatory action may have on the public and offset such costs with the removal of two other significant regulatory actions.

The total or aggregate net benefits associated with the rule cannot be quantified; however, they are expected to be small or slightly more than the estimated Agency cost savings. Thus, the rule is considered a deregulatory action per Executive Order 13771.

The Agency prepared a programmatic environmental assessment to determine whether this rule would have a significant impact on the quality of the human environment under the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq. ). The programmatic environmental assessment describes and analyzes two alternatives: the rule (proposed action) and continuing with the existing regulations (no action). The programmatic environmental assessment is available for review with the supporting documents for this regulation at http://www.regulations.gov. The final programmatic environmental assessment supports a finding of no significant impact for the rule; therefore, preparation of an environmental impact statement pursuant to the National Environmental Policy Act is not required.

This rule has been reviewed in accordance with the requirements of Executive Order 13175. Executive Order 13175 requires Federal agencies to consult and coordinate with Tribes on a government-to-government basis on policies that have Tribal implications (including regulations, legislative comments or proposed legislation, and other policy statements or actions) that have substantial direct effects on one or more Indian Tribes, on the relationship between the Federal government and Indian Tribes, or on the distribution of power and responsibilities between the Federal government and Indian Tribes. To ensure Tribal perspectives were heard and fully considered during rulemaking, the Agency contacted all federally recognized Indian Tribes and Alaska Native Corporations in accordance with Executive Order 13175, (Consultation and Coordination with Indian Tribal Governments); USDA Departmental Regulation 1350-02 (Tribal Consultation, Coordination and Collaboration); and Forest Service Handbook 1509.13, chapter 10 (Consultation with Indian Tribes and Alaska Native Corporations). The Agency initiated formal consultation on the rulemaking by contacting the Indian Tribes and Alaska Native Corporations by mail.

The consultation period began in September 2018 and continued until January 2, 2021, or 60-days beyond the close of the 60-day public comment period on the proposed rule. Consultation materials included the advance notice of proposed rulemaking, briefing documents that outline possible revisions of the existing regulations and the reasons why these changes are being proposed, a list of frequently asked questions, and two webinars.

The consultation process included two in-person regional Tribal consultation meetings in the Forest Service's Southwest Region: one was held on October 29, 2018, in Albuquerque, New Mexico, and the other on October 31, 2018, in Flagstaff, Arizona. During the consultation meeting on October 31, 2018, the Hopi Tribe requested additional face-to-face consultation with the Regional Forester. The Agency also received written comments from the Hopi Tribe and the Rincon Band of Luiseno Indians by letter and from the Federated Indians of Graton Rancheria by email. Most comments stated that the Tribes will be provided additional review and comment once the Agency releases the proposed rule, as part of the consultation process.

An invitation to consult on the proposed revisions to our Oil and Gas Resources regulations was sent to all Tribal leaders or their representative on the September 1, 2020, date of the proposed rule's publication. The invitation included information about two upcoming webinars on September 22 and 23, 2020, as well as a 228E change comparison table and a summary analysis of the proposed rule.

Tribal comments were received and considered on the proposed rule through consultation efforts. Tribal communications centered around acknowledgement of the proposed regulations and included requests for extension of the public comment time. Though the Forest Service declined to extend the 60-day public comment period, the Agency responded to requests for an extension by clarifying that the Tribal consultation period was open until January 2, 2021, or 60-days beyond the 60-day public comment period. Additional comments were not submitted during that time.

The Director of the Office of Tribal Relations certified by signature that the review and analysis of the 228E regulation revision was conducted in accordance with Departmental Regulation 1350-002, Tribal Consultation and Executive Order 13175, Consultation and Coordination with Indian Tribal Governments.

The Agency considered the impacts of the rule on small entities, consistent with requirements of the Regulatory Flexibility Act, as amended by the Small Business Regulatory Enforcement Fairness Act of 1996, and Executive Orders 13272 and 13563 ( Proper Consideration of Small Entities in Agency Rulemaking ). Under the Regulatory Flexibility Act, whenever an agency is required to publish a notice of rulemaking for any proposed or final rule, it must prepare and make available for public comment a regulatory flexibility analysis that describes the effects of the rule on small entities (such as small businesses, small organizations, and small government jurisdictions). However, no regulatory flexibility analysis is required if the head of the agency certifies the rule will not have a significant economic impact on a substantial number of small entities. Small entities potentially impacted by the proposed rule include small businesses (firms) involved in oil and gas extraction operations (North American Industry Classification System (NAICS) 211120 (crude petroleum extraction) and NAICS 211130 (natural gas extraction)), drilling oil and gas wells (NAICS 213111), and support activities for oil and gas operations (NAICS 213112). The rule does not affect the terms, conditions, and stipulation of existing leases. The rule can impact businesses that express interest in or decide to bid on new leases or otherwise decide to engage in oil and gas development and operations on National Forest System lands currently under lease or that may come under lease in the future. The rule provides both direct and indirect benefits to small businesses depending on whether the business holds leases or provides drilling and other support services.

There were 260 different firms operating oil and gas producing wells on National Forest System lands as of September 2022, of which 249 (96 percent) are estimated to be small businesses based on the Small Business Administration small business criterion of 1,250 employees for NAICS 211120 and NAICS 211130. The rule will primarily impact a subset of operators that express interest in leasing National Forest System lands or applying for permits to drill new wells on lands managed by the Forest Service in the future. As an estimate for the subset of affected small businesses, the Forest Service used the average of 75 surface plans of operations for new wells that were approved annually, from 2018 through 2022, and assumed each new surface use plan of operations is submitted by a different firm (which is unlikely and provides a high side estimate). Other aspects of the rule will likely go unnoticed by operators. For example, compliant operators will likely experience no effects from new procedures that the Agency will follow to monitor for compliance. For comparison to the effect on 75 small businesses annually, the estimated number of small firms associated with the oil and gas extraction sector (NAICS 211120 and NAICS 211130) for the Nation is approximately 4,500 based on Census Bureau, 2020 statistics for U.S. businesses. Therefore, the percent of small businesses impacted by the rule on an annual basis is projected to be small (75 of 4,500 is 1.7 percent).

The aggregate impact of the rule, compared to baseline regulatory conditions, is expected to be positive for a majority of the entities involved in oil and gas leasing, development, and operations on National Forest System lands, as noted in the regulatory impact analysis. Provisions of the rule are expected to reduce the times for reviewing and approving leases and permits, thereby saving operator costs and expediting opportunities for production and revenue. Exceptions might include cases where some operators (i) may be faced with increases in costs to obtain financial guarantees (such as surety bonds) to cover incremental increases in bond amounts to help cover full reclamation costs consistent with the existing rule, (ii) have to apply for special use authorizations, or (iii) pay an administrative fee to mitigate emergency non-compliance situations under the rule (however, these situations are expected to be infrequent, involve relatively small incremental costs, or reflect transfers of financial risk back to operators as intended by the existing rule). Based on the evidence summarized above, the rule is expected to increase opportunities for net benefits to small entities on average. The number of small entities that would be impacted is not likely to be substantial. The Department therefore certifies that this rule will not have a significant economic impact on a substantial number of small entities indicating that an initial regulatory flexibility analysis is not required.

More information on the Regulatory Flexibility Act and Small Business Regulatory Enforcement Fairness Act determination is available with the supporting documents for this regulation at http://www.regulations.gov.

The Agency considered this rule under the requirements of Executive Order 13132, Federalism. The Agency has concluded that the rule conforms to the federalism principles set out in this Executive Order. It will not impose any compliance costs on the States and will not have substantial direct effects on the States or the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, the Agency has determined that no further assessment of federalism implications is necessary.

This rule has been analyzed in accordance with the principles and criteria contained in Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights, and it has been determined that the rule does not pose the risk of a taking of protected private property. This rule affects management of Federal oil and gas resources and does not apply to privately held oil and gas rights.

This rule complies with the requirements of Executive Order 12988. More specifically, this rule meets the criteria of section 3(a), which requires agencies to review all regulations to eliminate errors and ambiguity and to write all regulations to minimize litigation. This rule also meets the criteria of section 3(b)(2), which requires agencies to write all regulations in clear language with clear legal standards.

Pursuant to Title II of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538), the Agency has assessed the effects of the rule on State, local, and Tribal governments, and on the private sector. This rule would not compel the expenditure of $100 million or more by State, local, or Tribal governments, in the aggregate, or by the private sector. Therefore, this rule is not subject to the requirements of sections 202 and 205 of the Unfunded Mandates Reform Act.

This final rule contains a collection of information for which the Agency is following the requirements of the Paperwork Reduction Act (44 U.S.C. 3501 et seq. ). The final rule does not establish any new information collection requirements.

Therefore, for the reasons set forth in the preamble, the Forest Service is amending chapter II of title 36 of the Code of Federal Regulations as follows:

The Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (section 701 of Pub. L. 114-74) (the “2015 Act”) amended the Federal Civil Penalties Inflation Adjustment Act of 1990 (Pub. L. 101-410, 104 Stat. 890 (1990)), which is intended to improve the effectiveness of CMPs and to maintain the deterrent effect of such penalties, requires agencies to adjust the CMPs for inflation annually.

HHS lists the CMP authorities and the amounts administered by all of its agencies in tabular form in 45 CFR 102.3, which was issued in an interim final rule published in the September 6, 2016, Federal Register (81 FR 61538). Annual adjustments were subsequently published on February 3, 2017 (82 FR 9175), October 11, 2018 (83 FR 51369), November 5, 2019 (84 FR 59549), January 17, 2020 (85 FR 2869), November 15, 2021 (86 FR 62928), March 17, 2022 (87 FR 15100), October 6, 2023 (88 FR 69531), and August 8, 2024 (89 FR 64815) .

The annual inflation adjustment for each applicable CMP is determined using the percent increase in the Consumer Price Index for all Urban Consumers (CPI-U) for the month of October of the year in which the amount of each CMP was most recently established or modified. In the December 17, 2024, Office of Management and Budget (OMB) Memorandum for the Heads of Executive Departments and Agencies, M-25-02, “Implementation of Penalty Inflation Adjustments for 2025, Pursuant to the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015,” OMB published the multiplier for the required annual adjustment. The cost-of-living adjustment multiplier for 2025, based on the CPI-U for the month of October 2024, not seasonally adjusted, is 1.02598. The multiplier is applied to each applicable penalty amount that was updated and published for fiscal year (FY) 2024 and is rounded to the nearest dollar.

In addition to the inflation adjustments for 2025, this final rule corrects several technical errors and updates descriptions for clarification and accuracy. The following non-substantive technical errors were identified and are corrected and following descriptions are updated in the table in 45 CFR 102.3:

• The description of 42 U.S.C. 1320a-7j(h)(3)(A) is revised to add the word “Maximum” to accurately reflect the statutory maximum penalty amount.

• The regulatory cite associated with “Penalty against hospital identified by CMS as noncompliant according to § 182.50 with respect to price transparency requirements regarding diagnostic tests for COVID-19” was corrected from 45 CFR 180.90 to 45 CFR 182.70.

• The 2024 maximum penalty associated with 45 CFR 180.90(c)(2)(ii)(C) was revised as it was cited incorrectly as $3,021 but should have been $6,118 in the last adjustment. In the 2024 adjustment, the amount reflected in the 2023 Maximum Adjusted Penalty column should have been $5,926, which was the actual adjusted amount in 2023 (see 88 FR at 69541). However, this amount was inadvertently mistyped as $2,926 in the last adjustment (see 89 FR at 64823). Applying the 2024 multiplier to the correct amount would have resulted in $6,118 ($5,926 × 1.03241). Therefore, the 2024 Maximum Adjusted Penalty was revised in this rule to $6,118.

The 2015 Act requires Federal agencies to publish annual penalty inflation adjustments notwithstanding section 553 of the Administrative Procedure Act (APA). Section 4(a) of the 2015 Act directs Federal agencies to publish annual adjustments no later than January 15th of each year thereafter. In accordance with section 553 of the APA, most rules are subject to notice and comment and are effective no earlier than 30 days after publication in the Federal Register . However, section 4(b)(2) of the 2015 Act provides that each agency shall make the annual inflation adjustments “notwithstanding section 553” of the APA. According to OMB's Memorandum M-25-02, the phrase “notwithstanding section 553” in section 4(b)(2) of the 2015 Act means that “the notice and comment process the APA generally requires— i.e., notice, an opportunity for comment, and a delay in effective date—is not required for agencies to issue regulations implementing the annual adjustment.”

Consistent with the language of the 2015 Act and OMB's implementation guidance, the inflation adjustments set out in this rule are not subject to notice and an opportunity for public comment and will be effective immediately upon publication. Also, HHS finds that notice and comment procedures would be impracticable and unnecessary under the APA for the ministerial and technical changes in this rule. In addition, HHS is waiving notice and comment for the non-substantive technical corrections set out in this final rule. HHS finds good cause for issuing these changes as a final rule without prior notice and comment because these changes make technical clarifying edits to descriptions and corrections to inadvertent typographical errors from the last update. For these same reasons, HHS also finds good cause to make the final rule effective upon publication.

Pursuant to OMB Memorandum M-25-02, HHS has determined that the annual inflation adjustment to the civil monetary penalties in its regulations does not trigger any requirements under procedural statutes and Executive Orders that govern rulemaking procedures.

This rule is effective on the date specified in the DATES section of this final rule. The adjusted civil monetary penalty amounts apply to penalties assessed on or after the date specified in the DATES section of this final rule, if the violation occurred on or after November 2, 2015 ( i.e., the date of enactment of the 2015 Act). If the violation occurred before November 2, 2015, or a penalty was assessed before September 6, 2016, the pre-adjustment civil penalty amounts in effect before September 6, 2016, will apply.

For reasons discussed in the preamble, the Department of Health and Human Services amends subtitle A, title 45 of the Code of Federal Regulations as follows: