On February 13, 2026, CISA announced the scheduling of seven town hall meetings in March through April 2026 to allow external stakeholders a limited additional opportunity to provide input on refining the scope and burden of the CIRCIA Notice of Proposed Rulemaking (NPRM). See 91 FR 6794 (Feb. 13, 2026) and 89 FR 23644 (Apr. 4, 2024). The February 2026 notice provided background on the CIRCIA NPRM, specific topics of interest, and town hall meeting procedures.

Due to the lapse in the Department of Homeland Security's (DHS) appropriations from February 14, 2026, to April 30, 2026, CISA did not hold the previously announced town hall meetings. This notice announces a revised town hall schedule as listed in the DATES section above.

All other information provided in the SUPPLEMENTARY INFORMATION section of the February 13, 2026, notice, such as the background, specific topics of interest, and town hall meeting procedures remain unchanged. 91 FR 6794 (Feb. 13, 2026).

As described elsewhere in today's Federal Register , the Board is requesting comment on proposed updates to (1) the Federal Reserve's Policy on Payment System Risk (PSR Policy) and (2) the Board's guidelines for Reserve Banks to utilize in evaluating requests for access to Reserve Bank accounts and services (the Account Access Guidelines), to accommodate Payment Accounts. That request for comment (the Payment Account Notice) follows a request for information (RFI) previously published by the Board. 1 The Payment Account would be a new, optional way for institutions to request access to accounts and services. As proposed in the Payment Account Notice, the Payment Account would have a standard set of risk-mitigating terms designed to create a lower residual risk profile than a master account. 2 The Board explains in the Payment Account Notice that the terms of the proposed Payment Account would permit a more streamlined review of requests for such accounts. 3

In this notice of proposed rulemaking (NPR), the Board proposes to amend Regulation A to specify that a holder of a Payment Account would not be eligible for discount window credit. The proposed amendments complement the proposed risk-mitigating terms for Payment Accounts that are described more fully in the Payment Account Notice. This SUPPLEMENTARY INFORMATION comprises six parts. Section I provides a high-level overview of the proposal. Section II discusses the RFI and summarizes comments on the RFI germane to this NPR. Section III provides statutory and regulatory background. Section IV discusses the rationale for the proposal and describes the revisions the Board proposes to make to Regulation A. Section V solicits feedback on the proposal broadly and on questions regarding specific aspects of the proposal. Section VI addresses several administrative law matters.

The RFI, published in the Federal Register on December 23, 2025, sought public input on a prototype Payment Account and potential updates to the Account Access Guidelines. The prototype Payment Account described in the RFI would be designed for the purpose of clearing and settling the Payment Account holder's payment activity. The Board explained that Payment Accounts would have a standard set of risk-mitigating terms, including that an institution holding a Payment Account would not be permitted to access intraday or discount window credit from Reserve Banks. The Board noted in the RFI that limiting access to Reserve Bank credit would reduce the risk that a Payment Account holder could pose to a Reserve Bank. 4 The Board invited comments on all aspects of the RFI.

The Board received 72 comments on the RFI. Commenters discussing the discount window included trade associations representing commercial banks and money transmitters, non-traditional institutions, a nonprofit organization, and others.

A majority of these commenters supported the Board's proposal not to permit Payment Account holders to access discount window credit as part of the standard set of terms for Payment Accounts. These commenters cited several reasons. One commenter argued that not providing discount window access to Payment Account holders would mitigate moral hazard concerns. The commenter stated that access to the discount window might create expectations of government support and encourage excessive risk taking. Commenters also addressed the discount window as a tool of monetary policy and systemic liquidity support. They asserted that the discount window should be available only to full-service depository institutions subject to a full complement of prudential standards, capital and liquidity oversight, and supervisory expectations. Commenters also noted that not permitting discount window access to Payment Account holders would mitigate risk to Reserve Banks.

Among commenters that discussed the discount window, a minority expressed support for discount window access. A number of commenters suggested that the Board consider some discount window access in unusual or exigent circumstances, including to mitigate the effects of operational incidents and significant stablecoin redemptions. Another commenter, while not necessarily advocating for discount window access, noted that a prefunding model coupled with prohibitions on daylight overdrafts and lack of access to discount window credit could constrain money creation and limit Payment Accounts to fully funded payments.

The discount window plays an important role in supporting the liquidity and stability of the banking system and the effective implementation of monetary policy. By providing ready access to funding, the discount window helps depository institutions manage their liquidity risks efficiently and avoid actions that have negative consequences for their customers, such as withdrawing credit during times of market stress. Thus, the discount window supports the smooth flow of credit to households and businesses. Providing liquidity in this way is one of the original purposes of the Federal Reserve System. The statutory framework for the discount window is set forth in the Federal Reserve Act (FRA), and general policies that govern discount window lending are set forth in Regulation A. The twelve Reserve Banks administer the discount window within this framework.

Several sections of the FRA authorize Reserve Banks to extend credit to member banks, depository institutions, and branches and agencies of foreign banks. Reserve Banks generally extend credit pursuant to sections 10B, 13(14), and 19(b)(7) of the FRA. Section 10B of the FRA provides that any Reserve Bank, under rules and regulations prescribed by the Board, may make advances to any member bank on its time or demand notes, subject to certain maturity limitations, and which are secured to the satisfaction of the Reserve Bank. 5 Section 13(14) of the FRA provides that, subject to such restrictions, limitations, and regulations as may be imposed by the Board, each Reserve Bank may discount paper endorsed by and make advances to any branch or agency of a foreign bank in the same manner and to the same extent that the Reserve Bank may exercise such powers with respect to a member bank, if the branch or agency is maintaining reserves with the Reserve Bank pursuant to section 7 of the International Banking Act of 1978 (codified at 12 U.S.C. 3105). 6 Section 19(b)(7) of the FRA provides that any “depository institution” in which transaction accounts or nonpersonal time deposits are held shall be entitled to the same discount and borrowing privileges as member banks. 7 Certain other provisions of the FRA authorize Reserve Banks to extend credit through discounts and advances to depository institutions, such as sections 13(2) and 13(8) of the FRA. 8

The Board's Regulation A (12 CFR part 201) provides that the Federal Reserve System extends credit with due regard to the basic objectives of monetary policy and the maintenance of a sound and orderly financial system. 9 It establishes rules under which a Reserve Bank may extend credit to depository institutions and, as provided in § 201.1(b), U.S. branches and agencies of foreign banks that are subject to reserve requirements under the Board's Regulation D (12 CFR part 204). Section 201.2 of Regulation A defines certain terms, including the term “depository institution.” To qualify as a depository institution for purposes of Regulation A, an institution must maintain reservable transaction accounts or nonpersonal time deposits. 10 The term “depository institution” excludes bankers' banks and corporate credit unions that are not required to maintain reserves under § 204.1(c)(4) of Regulation D. 11

Section 201.3 of Regulation A sets forth general provisions for extensions of credit by Reserve Banks. As provided in § 201.3(a)(1), a Reserve Bank may lend to a depository institution either by making an advance secured by acceptable collateral under § 201.4 or by discounting certain types of paper, but a Reserve Bank generally extends credit by making an advance. Section 201.3(a)(2) provides that an advance made to a depository institution must be secured to the satisfaction of the Reserve Bank making the advance and sets forth a non-exclusive list of asset types that are satisfactory collateral. Section 201.3(a)(3) addresses use of discounts in lieu of advances. Section 201.3(b) states that no person or entity is entitled to obtain any credit or any increase, renewal, or extension of maturity of any credit from a Reserve Bank. Section 201.3(c) prescribes certain information requirements related to discount window credit. Finally, § 201.3(d) pertains to indirect credit obtained by one depository institution as an agent or medium for another depository institution. Section 201.4(a) through (c) of Regulation A sets forth the three discount window programs under which the Reserve Banks extend credit.

The Board proposes to amend § 201.2 and § 201.3 of Regulation A to define the term “payment account” and to specify that a Payment Account holder is not eligible for access to discount window credit from the Reserve Banks.

As explained in the Payment Account Notice, the Board has continued to monitor developments in the payments ecosystem since the Board issued the Account Access Guidelines, including the development of new financial products and technologies. Since then, the types of institutions seeking accounts and services have continued to evolve. Several institutions focused on payments innovation have explained that they are interested in direct access to accounts and services, as opposed to having to rely on third-party intermediaries to access services, to reduce costs to their customers and reduce risks while increasing payment processing speed. The Board is proposing to create a Payment Account as a new, optional way for institutions to request access to accounts and services to support private-sector payments innovation while prudently managing the risks identified in the Account Access Guidelines. As part of the standard set of risk-mitigating terms applicable to Payment Accounts, the Board proposes not to permit discount window access for Payment Account holders.

The Board believes that not permitting discount window access for Payment Account holders would mitigate risk to the Reserve Banks (and by extension to the American public) in a consistent and transparent manner across different types of Payment Account holders with novel and diverse business models and risk profiles. 12 The Board anticipates that Payment Account holders generally would not be federally insured (that is, they would be Tier 2 or Tier 3 institutions under the Account Access Guidelines), and, as noted in the Payment Account Notice, Tier 2 and Tier 3 institutions may present greater risk than federally insured institutions.

In addition, different Payment Account holders will be subject to varying insolvency regimes. Resolution of federally insured institutions follows clear, consistent, and well-established rules for paying Reserve Banks and other creditors of a failed institution. Insolvency regimes applicable to uninsured Payment Account holders may be new or may involve the application of rarely applied state and federal laws. Moreover, uninsured Payment Account holders would likely not be subject to a framework of prudential supervision and regulation that is as robust as that applied to federally insured depository institutions. Finally, data available to Reserve Banks may vary across Payment Account holders. Current credit risk monitoring at Reserve Banks relies mostly on supervisory information received from within the Federal Reserve System or from other federal regulators, and similar information on the full range of potential Payment Account holders may not be readily available.

In addition to mitigating risk to the Reserve Banks, not permitting discount window access to Payment Account holders would mitigate risks posed by Payment Accounts to the financial sector and economy. Payment Account holders may engage in novel and diverse business models that involve greater and less-predictable risk-taking than business models of insured depository institutions, and liquidity provision to such firms could incentivize risk-taking behavior. Although such incentives exist across all institutions, Payment Account holders will also be subject to different supervisory frameworks in a rapidly evolving regulatory environment. The Board believes that not permitting discount window access for Payment Account holders would mitigate risk to the financial sector and the economy in a consistent and transparent manner across different types of Payment Account holders that present varying levels of risk.

The Board could, alternatively, leave unchanged the current discount window eligibility requirements in Regulation A. 13 It is possible that permitting discount window access for Payment Account holders that otherwise meet the current eligibility criteria under Regulation A may support broader financial stability and the Federal Reserve's monetary policy implementation goals. Discount window access would help such Payment Account holders obtain liquidity during periods of stress and could potentially support control of the federal funds rate under certain circumstances. On balance, however, and having considered the comments received, the Board believes it is appropriate not to permit Payment Account holders to access the discount window. Not permitting discount window access for Payment Account holders would mitigate risk to the Reserve Banks, the financial system, and the economy in a consistent and transparent manner across different types of Payment Account holders that may present varying levels of risk. It would also be consistent with the other terms proposed for Payment Accounts discussed in the Payment Account Notice, which are designed as a standard set of risk mitigants for Payment Accounts.

Currently, Regulation A addresses eligibility for the discount window by reference to whether an institution is a “depository institution” as defined in § 201.2(c) or, as provided for in § 201.1(b), a branch or agency of a foreign bank subject to reserve requirements under Regulation D (12 CFR part 204). The Board proposes to define the term “payment account” in a new § 201.2(d) as the record maintained by a Reserve Bank of the debtor-creditor relationship between the Reserve Bank and a single depository institution with respect to deposit balances of the depository institution that are maintained with the Reserve Bank and which is governed by an agreement that states the account is a payment account. 14 This definition is structured similarly to the definition of “master account” in Regulation D and the proposed definition of “payment account” set forth in the Board's proposal, published elsewhere in today's Federal Register , to amend Regulation D. 15 However, the proposed definitions for Regulation A and Regulation D differ somewhat based on the terminology used in each regulation. 16 Current § 201.2(d) through (f) would be renumbered accordingly.

The Board proposes to revise § 201.3(a)(1) to specify that a Reserve Bank may lend to a depository institution, except as described in proposed new § 201.3(a)(4), either by making an advance secured by acceptable collateral under § 201.4 or by discounting certain types of paper. Proposed § 201.3(a)(4) would specify that a Reserve Bank may not lend under § 201.4(a), (b), or (c) to a depository institution that holds a payment account. 17 Section 201.3(a)(1) would continue to specify that a Reserve Bank generally extends credit by making an advance.

The proposed revisions to Regulation A would prohibit access to the discount window only for depository institutions that hold Payment Accounts and would have no effect on discount window eligibility for other depository institutions, whether those institutions access the discount window through their own master accounts or through the master account of a correspondent. 18

The Board invites comment on all aspects of the proposed revisions. In addition, the Board invites feedback on the following specific questions related to the proposal:

1. Has the Board appropriately identified and considered the potential risks and benefits of permitting or not permitting Payment Account holders to access discount window credit? Are there other potential risks and benefits the Board should consider?

2. Should the Board instead retain the existing eligibility requirements for the discount window set forth in Regulation A? If so, why?

3. Should the Board instead consider a narrow restriction on eligibility for discount window credit ( e.g., a restriction applicable to only certain types of Payment Account holders) or permit access to discount window credit for Payment Account holders in limited circumstances ( e.g., periods of significant market stress)? If so, why? How should the Board define these restrictions or limitations?

The Regulatory Flexibility Act, 5 U.S.C. 601 et seq. (RFA), requires an agency to consider the impact of its rules on small entities. 19 In connection with a proposed rule, the RFA generally requires an agency to prepare an Initial Regulatory Flexibility Analysis (IRFA) describing the impact of the rule on small entities, unless the head of the agency certifies that the proposal will not have a significant economic impact on a substantial number of small entities and publishes such certification along with a statement providing the factual basis for such certification in the Federal Register . An IRFA must contain (i) a description of the reasons why action by the agency is being considered; (ii) a succinct statement of the objectives of, and legal basis for, the proposal; (iii) a description of, and, where feasible, an estimate of the number of small entities to which the proposal will apply; (iv) a description of the projected reporting, recordkeeping, and other compliance requirements of the proposal, including an estimate of the classes of small entities that will be subject to the requirement and the type of professional skills necessary for preparation of the report or record; (v) an identification, to the extent practicable, of all relevant Federal rules that may duplicate, overlap with, or conflict with the proposal; and (vi) a description of any significant alternatives to the proposal that accomplish its stated objectives and minimize any significant economic impact of the proposed rule on small entities. 20

The Board is providing an IRFA with respect to the proposal. The Board believes that the proposal will not have a significant economic impact on a substantial number of small entities. Payment accounts would be a new, optional way for institutions to request access to Reserve Bank accounts and services. Institutions would retain the option of requesting a master account or not requesting any account, and eligibility for access to the discount window would remain unchanged for master account holders and non-account holders. The proposal, therefore, would not impose mandatory requirements on any small entities. The Board invites comment on all aspects of this IRFA.

As discussed in this Supplementary Information , the Board is proposing to amend § 201.2 and § 201.3 of Regulation A in connection with the Board's proposal to update the PSR Policy and Account Access Guidelines.

As discussed in this Supplementary Information , the proposal relates to proposed amendments to the PSR Policy and Account Access Guidelines regarding Payment Accounts and would implement a proposed standard term applicable to Payment Accounts. The Reserve Banks generally extend credit pursuant to sections 10B, 13(14), and 19(b)(7) of the FRA. Each of those sections of the FRA authorizes the Board to prescribe regulations regarding the Reserve Banks' extensions of credit.

Under Regulation A, Reserve Banks may extend discount window credit to “depository institutions” and, in the same manner as Regulation A applies to depository institutions, to branches and agencies of foreign banks. The SBA has adopted size standards for determining whether a particular entity is a “small entity” for purposes of the RFA. The Board believes that the most appropriate SBA size standard to apply in determining whether a depository institution or branch or agency of a foreign bank is a small entity is the SBA size standard for “commercial banking.” Under this standard, an entity engaged in commercial banking is considered a small entity if it has total assets of $850 million or less. 21

Under the proposed amendments to Regulation A, a Reserve Bank would not be permitted to extend discount window credit to Payment Account holders, a population that could potentially include all institutions that are (1) legally eligible for access to the discount window; and (2) do not have a master account or settle transactions in a correspondent's master account. 22 The Board estimates that, as of the end of 2025, there are approximately 7,000 small entities, of which 6,800 already have a master account or access to financial services. Accordingly, the Board estimates that there are approximately 200 small entities that the proposed amendments to Regulation A might affect, were these small entities to decide to request Payment Accounts.

The proposed amendments would not impose reporting, recordkeeping, or other compliance requirements.

The Board is not aware of any federal rules that may duplicate, overlap with, or conflict with the proposal.

As discussed in Section IV.A above, the Board considered not proposing revisions to Regulation A. The Board does not believe that this alternative would have affected the economic impact on small entities because, as noted above, the Payment Account would be a new, optional way for institutions to request access to accounts and services, and the proposed amendments would not impose mandatory requirements on any small entities.

Therefore, the Board believes that the proposed revisions will not have a significant economic impact on substantial number of small entities supervised by the Board.

The Board welcomes comment on all aspects of its analysis. In particular, the Board requests that commenters describe the nature of any impact on small entities and provide empirical data to illustrate and support the extent of the impact.

In accordance with the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3506; 5 CFR 1320 Appendix A.1), the Board reviewed the proposed rule under the authority delegated to the Board by the Office of Management and Budget (OMB). The proposed rule contains no requirements subject to the PRA.

Section 722 of the Gramm-Leach-Bliley Act (Pub. L. 106-102, 113 Stat. 1338, 1471, 12 U.S.C. 4809) requires the federal banking agencies to use plain language in all proposed and final rules published after January 1, 2000. The Board has sought to present the proposal in a simple and straightforward manner and invites comment on the use of plain language and whether any part of the proposal could be more clearly stated.

The Providing Accountability Through Transparency Act of 2023 (5 U.S.C. 553(b)(4)) requires that an NPR include the internet address of a summary of not more than 100 words in length of the proposed rule, in plain language, that shall be posted on the internet website under section 206(d) of the E-Government Act of 2002 (44 U.S.C. 3501 note).

In summary, the Board proposes to amend its Regulation A (Extensions of Credit by Federal Reserve Banks) to specify that a holder of a proposed special-purpose payment account would not be eligible for access to discount window credit made available by the Federal Reserve Banks (Reserve Banks). The proposal would change neither the existing programs under which the Reserve Banks generally provide discount window credit (primary credit, secondary credit, and seasonal credit) nor the process for establishing the primary credit, secondary credit, and seasonal credit rates.

The proposal and such a summary can be found at https://www.regulations.gov and https://www.federalreserve.gov/supervisionreg/reglisting.htm.

For the reasons set forth in the preamble, the Board proposes to amend Regulation A, 12 CFR part 201, as follows:

As described elsewhere in today's Federal Register , the Board is requesting comment on proposed updates to (1) the Federal Reserve's Policy on Payment System Risk (PSR Policy) and (2) the Board's guidelines for Reserve Banks to utilize in evaluating requests for access to Reserve Bank accounts and services (the Account Access Guidelines), to accommodate Payment Accounts. That request for comment (the Payment Account Notice) follows a request for information (RFI) previously published by the Board. 1 The Payment Account would be a new, optional way for institutions to request access to accounts and services. As proposed in the Payment Account Notice, the Payment Account would have a standard set of risk-mitigating terms designed to create a lower residual risk profile than a master account. 2 The Board explains in the Payment Account Notice that the terms of the proposed Payment Account would permit a more streamlined review of requests for such accounts. 3

In this notice of proposed rulemaking (NPR), the Board proposes to amend Regulation D to specify that Reserve Banks would not pay interest on balances maintained in Payment Accounts. As described in more detail below, the proposal is designed to control the size of Payment Account balances on the Federal Reserve's balance sheet and align with the purpose of the Payment Account as a special-purpose account for clearing and settling payments. Relatedly, the Board is proposing in the Payment Account Notice to revise the PSR Policy to, among other things, establish a limit on balances that may be maintained in a Payment Account at the Federal Reserve's daily close of business (a Closing Balance Limit). 4 The amendments to Regulation D and the PSR Policy are both intended to control the size of Payment Account balances.

The Board also proposes to amend Regulation D to provide that Payment Account holders would not be able to participate in excess balance accounts (EBAs), which allow eligible institutions to maintain balances that are not being used for payments purposes in a limited-purpose account that pays interest. Permitting Payment Account holders to participate in EBAs could allow them to circumvent the zero interest rate on balances maintained in the Payment Account and the Closing Balance Limit.

This Supplementary Information comprises six sections. Section I provides a high-level overview of the proposal. Section II discusses the RFI and summarizes comments to the RFI germane to this NPR. Section III provides statutory and regulatory background. Section IV discusses the rationale for the proposal and describes the revisions the Board proposes to make to Regulation D. Section V solicits feedback on the proposal broadly and on questions regarding specific aspects of the proposal. Section VI addresses several administrative law matters.

The RFI, published in the Federal Register on December 23, 2025, sought public input on a prototype Payment Account and potential updates to the Account Access Guidelines. The prototype Payment Account described in the RFI would be designed for the purpose of clearing and settling the Payment Account holder's payment activity. The Board explained that Payment Accounts would have a standard set of risk-mitigating terms. These terms included not receiving interest on balances maintained at a Reserve Bank and a limit on overnight balances. The Board invited comments on the benefits and drawbacks of not paying interest on overnight balances in a Payment Account.

The Board received 72 comments on the RFI. Commenters discussing the payment of interest included traditional banks and credit unions, money transmitters, non-traditional banking institutions, trade associations, academics, and others.

Of the commenters that addressed the payment of interest, many supported the Board's proposal in the RFI to pay zero interest on balances maintained in Payment Accounts. Some of these commenters noted that paying zero interest on Payment Account balances would be consistent with the limited purpose of Payment Accounts and discourage use of Payment Accounts as a store of value or investment. A number of commenters stated that paying zero interest would limit risks to monetary policy implementation and financial stability. Some of these commenters noted concerns about the banking sector, stating that institutions likely to seek Payment Accounts would not engage in traditional deposit taking and lending and that paying interest on Payment Account balances could draw deposits away from commercial banks, increase commercial banks' funding costs, and raise the cost of credit for the real economy. Commenters also suggested that paying zero interest could reduce inflows to and outflows from Payment Accounts during periods of stress and could reduce the effect of Payment Accounts on the Federal Reserve's balance sheet. Another commenter argued that paying zero interest was a way to preserve the Federal Reserve's financial and institutional independence. This commenter explained that, to the extent dollar-based stablecoins are widely adopted, stablecoins would be likely to displace non-interest-bearing physical U.S. currency and erode the Federal Reserve's low-cost funding base. Two commenters noted that not paying interest would align with how similar accounts are handled by other central banks.

Other commenters, while not necessarily opposed to paying zero interest, raised concerns. One commenter noted that, while the absence of interest would keep the use of Payment Accounts in line with their purpose, the proposed Closing Balance Limit for each Payment Account holder would address this objective substantially on its own. Another commenter noted that paying zero interest could increase end-of-day balance minimization activity, adding operational complexity. A commenter also suggested that the absence of interest on Payment Account balances could introduce behavior that shifts activity to Payment Accounts in low-rate periods and away from Payment Accounts during high-rate periods.

A third set of commenters favored paying interest on balances held in Payment Accounts. Some of these commenters questioned the rationale supporting the disparate treatment of master account holders and Payment Account holders. Two commenters suggested that not paying interest could create an incentive for Payment Account holders to maintain insufficient balances in Payment Accounts. Commenters also argued in favor of paying interest on Payment Account balances to promote broader adoption of Payment Accounts and make them more economically feasible and attractive. A number of commenters discussed the payment of interest on balances maintained by stablecoin issuers, citing competition between differently organized issuers, opportunity costs for maintaining liquid reserves, and the potential for pass-through of interest by stablecoin issuers to establish a more direct link between monetary policy and household interest rates. Finally, a number of commenters suggested methods for the payment of interest on Payment Account balances. These included paying interest up to a threshold, phasing in interest after a Payment Account had been open for a year, and imposing targeted constraints rather than a blanket prohibition.

Section 19(b)(12) of the Federal Reserve Act (FRA) provides that Reserve Banks may pay interest on balances maintained by or on behalf of certain institutions in an account at a Reserve Bank at a rate or rates of interest not to exceed the general level of short-term interest rates. 5 Institutions that are eligible to receive interest on their balances held at Reserve Banks (eligible institutions) include “depository institutions,” as defined in FRA section 19(b)(1), as well as any trust company, any corporation organized under FRA section 25A or having an agreement with the Board under FRA section 25, or any branch or agency of a foreign bank. 6 This authority does not extend to all balances maintained at Reserve Banks, such as balances of the Federal Home Loan Banks and of certain other non-eligible institutions. 7 There is no requirement in the statute that interest be paid to any eligible institution, nor is there any requirement that the same interest rate or rates be paid to all eligible institutions or on all balances of eligible institutions.

Section 19(b)(12)(B) of the FRA also provides that the Board may prescribe regulations concerning the payment of interest. Specifically, the Board may prescribe regulations concerning (1) the payment of earnings in accordance with section 19(b)(12); (2) the distribution of such earnings to eligible institutions; and (3) the responsibilities of eligible institutions, Federal Home Loan Banks, and the National Credit Union Administration Central Liquidity Facility with respect to the crediting and distribution of earnings attributable to balances maintained in a Reserve Bank by any such entity on behalf of eligible institutions. 8

Regulation D § 204.10(a) provides that interest on balances maintained at Reserve Banks by or on behalf of an eligible institution shall be established by the Board, at a rate or rates not to exceed the general level of short-term interest rates. 9 That section defines the terms “balance” and “short-term interest rates” and further provides that the payment of interest on balances under § 204.10(b) shall be subject to such other terms and conditions as the Board may prescribe. For balances maintained in an eligible institution's master account, § 204.10(b)(1) provides that interest is the amount equal to the interest on reserve balances (IORB) rate on a day multiplied by the total balances maintained on that day. 10 For purposes of IORB, § 204.10(b)(3) defines the term “master account.”  11 The definition excludes any term deposit, EBA, or any deposit account maintained with a Reserve Bank governed by an agreement that states the account is not a master account. 12

Paragraphs (c), (d), and (e) of § 204.10 apply to pass-through balances, EBAs, and term deposits, respectively. Regulation D provides for pass-through arrangements to permit institutions to satisfy reserve requirements through a correspondent. 13 Section 204.10(c) provides that a correspondent that is an eligible institution may pass back to its respondent interest paid on balances maintained to satisfy a reserve balance requirement of that respondent. 14 It also provides that, with respect to a correspondent that is not an eligible institution, a Reserve Bank may pay interest only on the balances maintained to satisfy a reserve balance requirement of one or more respondents and that the correspondent must pass back to its respondents interest on balances paid in the correspondent's account. 15 Since March 2020, all reserve requirement ratios have been set at zero percent. 16

Paragraph (d) of § 204.10 provides for EBAs. 17 The Board authorized the creation of EBAs in 2009 to alleviate certain pressures on correspondent-respondent business relationships related to the difference between the federal funds rate and the interest rate paid at the time on excess reserves. 18 An EBA is a limited-purpose account at a Reserve Bank managed by an agent and established for maintaining the balances of one or more institutions (participants) eligible to earn interest on balances held at a Reserve Bank. 19 In an EBA arrangement, participants authorize an agent to transfer balances in and out of the EBA, and the balances held in the EBA are liabilities of the relevant Reserve Bank directly to the participants. As provided in paragraph (d)(3), balances maintained in an EBA may not be used for general payments or other activities. Pursuant to paragraph (d)(4), balances of eligible institutions maintained in an EBA earn interest at the IORB rate. Requests to be an EBA agent or participant are evaluated under the Account Access Guidelines as requests for master accounts, and, as described in the Payment Account Notice, the Board does not propose to change that treatment going forward. 20

Paragraph (e) of § 204.10 addresses term deposits. A Reserve Bank may accept term deposits from eligible institutions subject to such terms and conditions as the Board may establish from time to time. Section 204.10(e) provides that term deposits will not satisfy any institution's reserve balance requirement and may not be used for general payments or settlement activities. Reserve Banks currently do not accept term deposits. 21

The Board proposes to revise § 204.10 of Regulation D to specify that balances maintained in Payment Accounts would not receive interest and that Payment Account holders would not be able to participate in an EBA. As discussed in the Payment Account Notice, the Board also proposes therein to establish a Closing Balance Limit.

As explained in the Payment Account Notice, the Board has continued to monitor developments in the payments ecosystem since the Board issued the Account Access Guidelines, including the development of new financial products and technologies. Since then, the types of institutions seeking Federal Reserve accounts and services have continued to evolve. Several institutions focused on payments innovation have explained that they are interested in direct access to accounts and services, as opposed to having to rely on third-party intermediaries to access services, to reduce costs to their customers and reduce risks while increasing payment processing speed. The Board is proposing to create a Payment Account as a new, optional way for institutions to request access to accounts and services to support private-sector payments innovation while prudently managing the risks identified in the Account Access Guidelines. To control the size of accounts on the Federal Reserve's balance sheet, Payment Accounts would not earn interest on balances and, as discussed in the Payment Account Notice, would be subject to a Closing Balance Limit.

The Board has considered the effects of paying zero interest on Payment Account balances on monetary policy implementation. The establishment of Payment Accounts may affect the overall size and composition of the consolidated balance sheet of Reserve Banks and thereby may affect the implementation of monetary policy. By paying zero interest, Payment Account balances should generally remain relatively small at the end of the business day and, therefore, should not account for a significant portion of the Federal Reserve's balance sheet. Minimizing the size of Payment Accounts would help ensure that their direct effect on Federal Reserve liabilities is modest and that the Federal Reserve would not have to expand its balance sheet significantly beyond what would otherwise be needed to efficiently and effectively implement monetary policy. However, the indirect effects of Payment Accounts on other Federal Reserve liabilities is difficult to assess and would depend on several factors, including: the characteristics of the Payment Account holders ( i.e., their balance sheet composition and business models), the source of funds that flow into Payment Accounts ( e.g., deposits at depository institutions, physical currency), and the amount of sweeping activity of Payment Account holders from commercial bank deposits to support higher intraday balances in Payment Accounts.

The Board believes that paying zero interest and establishing a Closing Balance Limit would support the goal of limiting balances in Payment Accounts. During non-stress periods, it is likely that a zero interest rate will incentivize Payment Account holders to minimize Payment Account balances—potentially below the level of the Closing Balance Limit. During periods of general market stress, Payment Account holders may prefer to hold higher precautionary Payment Account balances than during non-stress periods, regardless of the interest rate paid on the Payment Account. In addition, there may be periods where the Payment Account holder has idiosyncratic incentives to hold higher balances at a Reserve Bank. In these periods, the Closing Balance Limit will further support minimizing balances in these accounts. Together, these two Payment Account terms—paying zero interest and the Closing Balance Limit—support the Board's goal of minimizing the direct effects of Payment Accounts on the Federal Reserve balance sheet to only what is needed for efficient and effective implementation of monetary policy.

The Board has also considered the alternative of paying interest on balances in a Payment Account up to the Closing Balance Limit, either at the IORB rate or at the Federal Reserve's overnight reverse repurchase operations (ON RRP) rate. The main rationale for paying interest would be to support control of the federal funds rate within the target range. The Board, however, believes that the risk to rate control of paying zero interest on Payment Account balances would be minimal. Additionally, to be consistent with the underlying purpose of the Payment Account to support the clearing and settling of payment activity rather than serving as a store of value, the Board believes it would be appropriate not to pay interest on the account balances.

The proposed revisions to Regulation D have been informed by comments received in response to the RFI. As summarized in Section II above, the views expressed differed among the commenters that discussed interest. A significant number of commenters supported the Board's zero-interest proposal in the RFI, citing both the purpose of Payment Accounts and potential effects on monetary policy and financial stability. Consistent with points raised by these commenters, the Board believes that paying zero interest, along with Closing Balance Limits, would (i) encourage Payment Account holders to not use Payment Accounts as a store of value or investment and (ii) allow the Federal Reserve to control the size of Payment Accounts on the Federal Reserve's balance sheet during both stress and non-stress periods.

The Board recognizes that many commenters recommended that the Board pay interest on all or a portion of balances maintained in Payment Accounts. Commenters raised a number of reasons for paying interest, including to: promote adoption of Payment Accounts; create parity between Payment Accounts and master accounts; and reduce an incentive for Payment Account holders to maintain insufficient balances to support settlement, liquidity management, and payment operations.

The Board believes that zero-interest Payment Accounts should be attractive as an option for accessing Federal Reserve accounts and services by uninsured depository institutions. Relatedly, in light of the limited purpose of Payment Accounts and the broader set of terms that will differentiate Payment Accounts and master accounts, the Board does not believe it is necessary to treat Payment Accounts and master accounts equivalently for purposes of interest.

With respect to the sufficiency of balances maintained in Payment Accounts, the Board believes that Payment Account holders—which would not have access to daylight overdrafts—will have a strong incentive to maintain sufficient balances in their accounts at the close of the Federal Reserve's business day in order to avoid having their payment orders rejected at the beginning of the next Federal Reserve business day. At the same time, paying zero interest should incentivize Payment Account holders to limit balances in Payment Accounts to those necessary for payments.

As described in more detail below, the Board proposes to amend § 204.10(b)(3) of Regulation D by revising the definition of “master account” to exclude Payment Accounts and adding a new definition of “payment account.” By virtue of this definitional change, balances maintained in Payment Accounts would not receive interest. The Board also proposes to amend § 204.10(d) to specify that Payment Account holders may not be EBA participants. Although the Board considered whether relevant amendments should be made to the provisions in § 204.10 regarding the payment of interest on pass-through balances and term deposits, the Board does not believe that any amendments are necessary.

Currently, § 204.10(b) provides for the payment of IORB only on balances maintained in “master accounts.” Paragraph (b)(2) defines master account using both a broad definition and a set of exceptions. The term master account means, for purposes of § 204.10(b), the record maintained by a Reserve Bank of the debtor-creditor relationship between the Reserve Bank and a single eligible institution with respect to deposit balances of the eligible institution that are maintained with the Reserve Bank. The term does not include a term deposit, an EBA, a joint account, or any deposit account maintained with a Reserve Bank governed by an agreement that states the account is not a master account.

A Payment Account would be a master account under the current definition, unless a Payment Account were governed by an agreement that states the account is not a master account. Given the existing ability to agree that an account is not a master account, it is not strictly necessary for purposes of IORB to amend Regulation D to expressly exclude Payment Accounts from the definition of master account. However, the Board believes that adding a specific exclusion for Payment Accounts would be clearer than relying on a general exclusion that makes no reference to Payment Accounts. Accordingly, the Board proposes to revise § 204.10(b)(3) to specifically exclude Payment Accounts from the definition of master account. The Board does not believe that it is necessary to make further revisions to § 204.10(b). The only accounts eligible for IORB under paragraph (b) are master accounts, and excluding Payment Accounts from the definition of master account will exclude them from IORB eligibility thereunder.

The Board proposes to define the term “payment account” in new § 204.10(b)(4). Specifically, the Board proposes to define a Payment Account as the record maintained by a Federal Reserve Bank of the debtor-creditor relationship between the Reserve Bank and a single eligible institution with respect to deposit balances of the eligible institution that are maintained with the Reserve Bank and which is governed by an agreement that states the account is a Payment Account. The Board believes that tying the status of a Payment Account to an agreement between a Reserve Bank and a Payment Account holder draws a simple and clear-cut difference between master accounts and Payment Accounts. 22

As described in Section III above, paragraph (d) of § 204.10 pertains to EBAs, which permit participants to hold excess balances in a limited-purpose account managed by an agent. Balances maintained in EBAs may not be used for general payments or other activities, but participants may ask their agents to transfer EBA balances to another account (such as that of a correspondent) for purposes of making payments. Section 204.10 does not set a limit on balances that may be maintained in an EBA and specifies that interest is paid on EBA balances at the IORB rate.

In connection with the Board's proposal to amend Regulation D to provide for zero interest on Payment Account balances and in connection with the Closing Balance Limit discussed in the Payment Account Notice, the Board also proposes to add a new subparagraph (d)(6) to § 204.10 to specify that a Payment Account holder would not be able to participate in an EBA. 23 As discussed above, the proposals to pay zero interest and to establish a Closing Balance Limit are designed to control the size of Payment Account balances on the Federal Reserve's balance sheet and to align the terms of the Payment Account with its nature as a special-purpose account for clearing and settling payments. If a Reserve Bank were able to approve a Payment Account holder as an EBA participant, the Payment Account holder may be able to circumvent these two terms of the Payment Account. For example, an EBA participant could instruct its agent to sweep large balances from the EBA into the Payment Account holder's Payment Account at the beginning of a Federal Reserve business day and sweep balances into the EBA at the end of the Federal Reserve business day. Since EBA balances are direct liabilities of a Reserve Bank to EBA participants, the entire EBA balance would constitute reserves. If this were to occur at scale, it could expand the Federal Reserve's balance sheet beyond what would otherwise be needed to efficiently and effectively implement monetary policy.

As described in Section III above, paragraphs (c) and (e) of § 204.10 pertain to interest on pass-through balances and term deposits. The Board does not believe any changes to those paragraphs are necessary with respect to Payment Accounts, for the reasons set forth below.

First, the Board does not believe that changes are needed to the treatment of pass-through balances in an environment in which reserve requirement ratios are zero. Section 204.10 of Regulation D provides that a pass-through correspondent that is an eligible institution under Regulation D may, but is not required to, pass back interest paid on balances maintained to satisfy a reserve balance requirement of its respondent. When the Board adopted a final rule regarding pass-through balances, the Board noted that requiring eligible institutions to pass back interest could interfere with existing correspondent-respondent relationships and that reserve deficiency charges were charged to correspondents regardless of whether the deficiency was attributable to a respondent. 24 The Board continues to believe that a correspondent and respondent should be able to negotiate the interest rate on balances maintained at the correspondent by the respondent. A pass-through correspondent must pass back interest if the correspondent is not an eligible institution. However, a Reserve Bank may pay interest only on balances maintained at a non-eligible institution to satisfy a reserve balance requirement of one or more respondents. All reserve requirement ratios are now zero, and no interest is paid to correspondents that are not eligible institutions.

Second, the Board does not believe changes are needed with respect to term deposits. The Reserve Banks do not currently accept term deposits. In addition, as described in Section III above, any term deposits are subject to such terms and conditions as the Board may establish from time to time. Accordingly, were term deposits to be accepted by Reserve Banks in the future, the Board could establish terms and conditions with respect to acceptance of term deposits by institutions that also have Payment Accounts.

The Board invites comment on all aspects of the proposed revisions. In addition, the Board invites feedback on the following specific questions related to the proposal:

1. Has the Board appropriately identified and considered the potential effects of Payment Accounts on monetary policy implementation, or are there additional effects on monetary policy implementation that the Board should consider?

2. The proposed revisions would provide that balances maintained in Payment Accounts would not earn interest.

a. Would the payment of zero interest effectively mitigate the impact of Payment Account balances on the Federal Reserve's balance sheet?

b. Are there effects of paying zero interest that the Board has not identified?

c. Should the Board instead provide for the payment of interest on Payment Account balances? If so, why and at what rate (the IORB rate, ON RRP rate, or another rate)? What effects would a different rate have on the Reserve Banks' combined balance sheet and the implementation of monetary policy?

d. The Board has proposed to revise paragraph (d) of § 204.10 to provide that a Payment Account holder would not be able to be an EBA participant. Is this revision appropriate or should the Board consider alternatives (which could include leaving paragraph (d) unchanged)?

e. The Board has proposed not to revise paragraphs (c) or (e) of § 204.10, which pertain to the payment of interest on pass-through balances and term deposits, respectively. Are revisions to those provisions necessary with respect to Payment Accounts?

3. In the Payment Account Notice, the Board has proposed to add new Part IV to the PSR Policy, which would outline some of the different types of accounts that Reserve Banks provide to legally eligible institutions, and the standard terms under which these accounts would be provided. Among other things, proposed Part IV would establish a Closing Balance Limit. A Payment Account holder would be expected to achieve an account balance at or below the Closing Balance Limit at the Federal Reserve's close of business. 25 The Closing Balance Limit would be set by the Reserve Bank based on expected payment activity, not to exceed $1 billion. 26 A Closing Balance Limit and paying zero interest on Payment Accounts both serve to minimize the balances held in Payment Account and the direct impact Payment Accounts have on the Federal Reserve balance sheet. A Closing Balance Limit and paying zero interest could have important interactions whereby a change in one of the terms could affect the efficacy of the other.

a. Given that paying zero interest and limiting closing balances on Payment Accounts both serve a similar purpose and have important interactions, should the Board consider codifying the Closing Balance Limit in Regulation D? Why or why not?

b. Are there important interactions between limiting closing balances and paying zero interest on Payment Accounts that the Board has not identified?

The Regulatory Flexibility Act, 5 U.S.C. 601 et seq. (RFA), requires an agency to consider the impact of its rules on small entities. 27 In connection with a proposed rule, the RFA generally requires an agency to prepare an Initial Regulatory Flexibility Analysis (IRFA) describing the impact of the rule on small entities, unless the head of the agency certifies that the proposal will not have a significant economic impact on a substantial number of small entities and publishes such certification along with a statement providing the factual basis for such certification in the Federal Register . An IRFA must contain (i) a description of the reasons why action by the agency is being considered; (ii) a succinct statement of the objectives of, and legal basis for, the proposal; (iii) a description of, and, where feasible, an estimate of the number of small entities to which the proposal will apply; (iv) a description of the projected reporting, recordkeeping, and other compliance requirements of the proposal, including an estimate of the classes of small entities that will be subject to the requirement and the type of professional skills necessary for preparation of the report or record; (v) an identification, to the extent practicable, of all relevant Federal rules that may duplicate, overlap with, or conflict with the proposal; and (vi) a description of any significant alternatives to the proposal that accomplish its stated objectives and minimize any significant economic impact of the proposed rule on small entities. 28

The Board is providing an IRFA with respect to the proposal. The Board believes that the proposal will not have a significant economic impact on a substantial number of small entities. First, Payment Accounts would be a new, optional way for institutions to request access to Reserve Bank accounts and services, and therefore no existing account holders would be affected. Second, institutions would retain the option of requesting a master account or not requesting any account. It is possible that a small entity could become an EBA participant and subsequently request a Payment Account. Under the proposed amendments, the small entity would become ineligible to participate in an EBA upon becoming a Payment Account holder. However, as discussed above, Payment Accounts are optional and small entities could decide to access Federal Reserve services through a correspondent. The proposed changes to Regulation D, therefore, would not impose mandatory requirements on any small entities. The Board invites comment on all aspects of this IRFA.

In addition, as discussed in Section I above, the Board is proposing in the Payment Account Notice to revise the PSR Policy to, among other things, establish a Closing Balance Limit. In this NPR, the Board is requesting comment on whether the Board should consider codifying the Closing Balance Limit in Regulation D. See Section V above (Question 3). As discussed in the Payment Account Notice, the Board believes that inclusion of the Closing Balance Limit in the PSR Policy would not have a significant economic impact on a substantial number of small entities. Codifying the Closing Balance Limit in Regulation D would not affect the Board's view, for the reasons discussed above.

As discussed in this SUPPLEMENTARY INFORMATION , the Board is proposing to amend § 204.10 of Regulation D in connection with the Board's proposal to update the PSR Policy and Account Access Guidelines. The Board is also requesting public comment on whether to codify the Closing Balance Limit in Regulation D

As discussed in this SUPPLEMENTARY INFORMATION , the proposed revisions to Regulation D relate to proposed amendments to the PSR Policy and Account Access Guidelines to accommodate Payment Accounts and would implement a proposed standard term applicable to all Payment Accounts. Section 19(b)(12)(B) of the FRA provides that the Board may prescribe regulations concerning the payment of interest on balances maintained by or on behalf of an eligible institution at a Reserve Bank.

With respect to the Closing Balance Limit, section 11(j) of the FRA authorizes the Board to exercise general supervision over the Reserve Banks, including their provision of accounts and services. 29 The Closing Balance Limit, whether in the PSR Policy or Regulation D, would support the Board's objective to foster the safety and efficiency of payment, clearing, settlement, and recording systems and to promote financial stability, more broadly.

The SBA has adopted size standards for determining whether a particular entity is a “small entity” for purposes of the RFA. The Board believes that the most appropriate SBA size standard to apply in determining whether a member bank, depository institution, or branch or agency of a foreign bank is a small entity is the SBA size standard for “commercial banking.” Under this standard, an entity engaged in commercial banking is considered a small entity if it has total assets of $850 million or less. 30

The population of relevant commercial banks could potentially include all institutions that (1) are legally eligible for a Payment Account, (2) are eligible institutions as defined in Regulation D, and (3) do not have a master account or settle transactions in a correspondent's master account. 31 With respect to the Closing Balance Limit, the population of relevant commercial banks could potentially include all institutions that (1) are legally eligible for a Payment Account and (2) do not have a master account or settle transactions in a correspondent's master account.

In both cases, the Board estimates that, as of the end of 2025, there are approximately 7,000 small entities, of which 6,800 already have a master account or access to financial services. 32 Accordingly, the Board estimates that there are approximately 200 small entities that the proposed amendments to Regulation D and the Closing Balance Limit might affect, were these small entities to decide to request Payment Accounts.

The proposed amendments to § 204.10 would not impose reporting, recordkeeping, or other compliance requirements.

An individual Payment Account's Closing Balance Limit would be based on the Reserve Bank's analysis of the Payment Account holder's payment flows, using internal Reserve Bank data and any forecasts and additional information provided by the Payment Account holder. 33

The Board is not aware of any federal rules that may duplicate, overlap with, or conflict with the proposal.

As discussed in Section IV.A above, the Board considered proposing the payment of interest on balances up to the Closing Balance Limit discussed in the Payment Account Notice at the IORB or ON RRP rate. As discussed in the Payment Account Notice, the Board considered alternatives with respect to the Closing Balance Limit, such as setting the Closing Balance Limit to zero and calculating the Closing Balance Limit in a different manner.

The Board does not believe that any of these alternatives considered by the Board would have affected the economic impact on small entities, because the Payment Account would be a new, optional way for institutions to request access to Reserve Bank accounts and services, and the proposed changes would not impose mandatory requirements on any small entities.

Therefore, the Board believes that neither the proposed revisions to Regulation D nor the provisions of the PSR Policy regarding the Closing Balance Limit will have a significant economic impact on a substantial number of small entities supervised by the Board.

The Board welcomes comment on all aspects of its analysis. In particular, the Board requests that commenters describe the nature of any impact on small entities and provide empirical data to illustrate and support the extent of the impact.

In accordance with the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3506; 5 CFR 1320 Appendix A.1), the Board reviewed the proposed rule under the authority delegated to the Board by the Office of Management and Budget (OMB). The proposed revisions contain no requirements subject to the PRA.

As discussed in Section I above, the Board is proposing in the Payment Account Notice to revise the PSR Policy and the Account Access Guidelines to accommodate Payment Accounts. The proposed revisions to the PSR Policy would, among other things, establish the Closing Balance Limit. In this NPR, the Board is requesting comment on whether the Board should consider codifying the Closing Balance Limit in Regulation D. See Section V above (Question 3).

Certain provisions of the Account Access Guidelines and PSR Policy contain “collections of information” within the meaning of the PRA subject to the PRA. The Board proposes in the Payment Account Notice to implement for three years the Disclosure Provisions Associated with the Payment System Risk Policy and Account Access Guidelines (FR 4103; OMB No. 7100-NEW) to account for these proposed revisions, as well as certain other information collections. Were the Board to codify the Closing Balance Limit in Regulation D, certain proposed revisions to the PSR Policy that contain collections of information may codified in Regulation D. 34 To account for that possibility, the Board is inviting comments on those collections of information in this NPR, in addition to the request for comment in the Payment Account Notice. Comments are invited on:

(a) whether the collection of information is necessary for the proper performance of the Board's functions, including whether the information has practical utility;

(b) the accuracy of the estimates of the burden of the information collection, including the validity of the methodology and assumptions used;

(c) ways to enhance the quality, utility, and clarity of the information to be collected;

(d) ways to minimize the burden of the information collection on respondents, including through the use of automated collection techniques or other forms of information technology; and

(e) estimates of capital or start-up costs and costs of operation, maintenance, and purchase of services to provide information

Comments on aspects of this document that may affect reporting, recordkeeping, or disclosure requirements and burden estimates should be sent to the addresses listed in the ADDRESSES section. A copy of the comments may also be submitted to the OMB desk officer for the Agencies: By mail to U.S. Office of Management and Budget, 725 17th Street NW, #10235, Washington, DC 20503 or by facsimile to (202) 395-5806, Attention, Federal Banking Agency Desk Officer.

Section 722 of the Gramm-Leach-Bliley Act (Pub. L. 106-102, 113 Stat. 1338, 1471, 12 U.S.C. 4809) requires the federal banking agencies to use plain language in all proposed and final rules published after January 1, 2000. The Board has sought to present the proposal in a simple and straightforward manner and invites comment on the use of plain language and whether any part of the proposal could be more clearly stated.

The Providing Accountability Through Transparency Act of 2023 (5 U.S.C. 553(b)(4)) requires that a NPR include the internet address of a summary of not more than 100 words in length of the proposed rule, in plain language, that shall be posted on the internet website under section 206(d) of the E-Government Act of 2002 (44 U.S.C. 3501 note).

In summary, the Board proposes to amend its Regulation D (Reserve Requirements of Depository Institutions) to differentiate between master accounts and a proposed new category of special-purpose payment accounts (Payment Accounts). The proposed amendments would exclude Payment Accounts from Regulation D's provisions directing Federal Reserve Banks (Reserve Banks) to pay interest on balances maintained at a Reserve Bank. As a result, the Reserve Banks would not pay interest on balances maintained in Payment Accounts.

The proposal and such a summary can be found at https://www.regulations.gov and https://www.federalreserve.gov/supervisionreg/reglisting.htm.

For the reasons set forth in the preamble, the Board proposes to amend Regulation D, 12 CFR part 204, as follows:

The revision and additions read as follows:

The FAA invites you to send any written relevant data, views, or arguments about this proposal. Send your comments using a method listed under the ADDRESSES section. Include “Docket No. FAA-2025-1353; Project Identifier MCAI-2025-00236-T” at the beginning of your comments. The most helpful comments reference a specific portion of the proposal, explain the reason for any recommended change, and include supporting data. The FAA will consider all comments received by the closing date and may amend this proposal because of those comments.

Except for Confidential Business Information (CBI) as described in the following paragraph, and other information as described in 14 CFR 11.35, the FAA will post all comments received, without change, to regulations.gov , including any personal information you provide. The agency will also post a report summarizing each substantive verbal contact received about this SNPRM.

CBI is commercial or financial information that is both customarily and actually treated as private by its owner. Under the Freedom of Information Act (FOIA) (5 U.S.C. 552), CBI is exempt from public disclosure. If your comments responsive to this SNPRM contain commercial or financial information that is customarily treated as private, that you actually treat as private, and that is relevant or responsive to this SNPRM, it is important that you clearly designate the submitted comments as CBI. Please mark each page of your submission containing CBI as “PROPIN.” The FAA will treat such marked submissions as confidential under the FOIA, and they will not be placed in the public docket of this SNPRM. Submissions containing CBI should be sent to Dan Rodina, Aviation Safety Engineer, FAA, 2200 South 216th St., Des Moines, WA 98198; phone: 206-231-3225; email: dan.rodina@faa.gov. Any commentary that the FAA receives which is not specifically designated as CBI will be placed in the public docket for this rulemaking.

The FAA issued AD 2024-25-06, Amendment 39-22908 (89 FR 100734, December 13, 2024) (AD 2024-25-06), for all Airbus SAS Model A318 and A320 series airplanes; Model A319-111, -112, -113, -114, -115, -131, -132, -133, -151N, -153N, and -171N airplanes; and Model A321-111, -112, -131, -211, -212, -213, -231, -232, -251N, -252N, -253N, -271N, -272N, -251NX, -252NX, -253NX, -271NX, -272NX, and -253NY airplanes. AD 2024-25-06 requires repetitive inspections of the main landing gear (MLG) door actuators and, depending on findings, accomplishment of applicable corrective actions, and prohibits the installation of affected parts. The FAA issued AD 2024-25-06 to address incorrectly assembled MLG door actuators, which, if not detected and corrected, could prevent the extension of the MLG, possibly resulting in significant damage to the airplane and potentially causing a fire that would involve emergency evacuation of the passengers.

The FAA issued an NPRM to amend 14 CFR part 39 by adding an AD to supersede AD 2024-25-06 that would apply to all Airbus SAS Model A318 and A320 series airplanes; Model A319-111, -112, -113, -114, -115, -131, -132, -133, -151N, -153N, and -171N airplanes; and Model A321-111, -112, -131, -211, -212, -213, -231, -232, -251N, -252N, -253N, -271N, -272N, -251NX, -252NX, -253NX, -271NX, -272NX, and -253NY airplanes. The NPRM was published in the Federal Register on July 8, 2025 (90 FR 30024). The NPRM was prompted by an MCAI issued by EASA, which is the Technical Agent for the Member States of the European Union. EASA issued EASA AD 2024-0216, dated November 15, 2024 (EASA AD 2024-0216), to correct an unsafe condition. The NPRM proposed to continue to require the actions in AD 2024-25-06 and added a new requirement to replace affected parts with serviceable parts.

Since the FAA issued the NPRM, EASA superseded EASA AD 2024-0216 with EASA AD 2025-0158, dated July 21, 2025, which in turn was revised by EASA AD 2025-0158R1, dated September 12, 2025 (EASA AD 2025-0158R1) (also referred to as the MCAI). The MCAI states that after EASA AD 2024-0216 was issued, the service information was revised to expand the list of serial numbers for the affected part, and that the applicability has been expanded to include new certified Airbus SAS Model A321-271NY airplanes, on which affected parts could be installed in service. The MCAI also added Airbus SAS Model A319-173N airplanes to the applicability.

The FAA is proposing this AD to address the unsafe condition on these products. You may examine the MCAI in the AD docket at regulations.gov under Docket No. FAA-2025-1353.

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

The FAA received an additional comment from Airbus. The following presents the comment received on the NPRM and the FAA's response.

Airbus requested that the FAA replace certain references to the MLG actuator and MLG door with the term, MLG door actuator, to align the NPRM with the MCAI and referenced material.

The FAA agrees and has revised this SNPRM accordingly.

EASA AD 2025-0158R1 specifies procedures for repetitive inspections for any discrepancy of each affected MLG door actuator, replacement of affected parts if any discrepancy is detected, and eventual replacement of all affected parts with serviceable parts. Discrepancy is defined as any MLG door actuator that does not meet all the results specified in the table in paragraph 5.6.2.2 in the material referenced in EASA AD 2025-0158R1. EASA AD 2025-0158R1 also prohibits the installation of affected parts. EASA AD 2025-0158R1 also specifies replacement of each affected part with a serviceable part, on the airplane, terminates the repetitive inspections.

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

These products have been approved by the civil aviation authority of another country and are approved for operation in the United States. Pursuant to the FAA's bilateral agreement with this State of Design Authority, that authority has notified the FAA of the unsafe condition described in the MCAI referenced above. The FAA is issuing this SNPRM after determining that the unsafe condition described previously is likely to exist or develop on other products of the same type design.

Certain changes described above expand the scope of the SNPRM. As a result, it is necessary to reopen the comment period to provide additional opportunity for the public to comment on this SNPRM.

This proposed AD would require accomplishing the actions specified in EASA AD 2025-0158R1 described previously, except for any differences identified as exceptions in the regulatory text of this proposed AD.

The FAA estimates that this AD, if adopted as proposed, would affect 1,933 airplanes of U.S. registry. The FAA estimates the following costs to comply with this proposed AD:

The FAA invites you to send any written relevant data, views, or arguments about this proposal. Send your comments using a method listed under the ADDRESSES section. Include “Docket No. FAA-2026-4643; Project Identifier AD-2025-01612-E” at the beginning of your comments. The most helpful comments reference a specific portion of the proposal, explain the reason for any recommended change, and include supporting data. The FAA will consider all comments received by the closing date and may revise this proposal because of those comments.

Except for Confidential Business Information (CBI) as described in the following paragraph, and other information as described in 14 CFR 11.35, the FAA will post all comments received, without change, to regulations.gov, including any personal information you provide. The agency will also post a report summarizing each substantive verbal contact received about this NPRM.

CBI is commercial or financial information that is both customarily and actually treated as private by its owner. Under the Freedom of Information Act (FOIA) (5 U.S.C. 552), CBI is exempt from public disclosure. If your comments responsive to this NPRM contain commercial or financial information that is customarily treated as private, that you actually treat as private, and that is relevant or responsive to this NPRM, it is important that you clearly designate the submitted comments as CBI. Please mark each page of your submission containing CBI as “PROPIN.” The FAA will treat such marked submissions as confidential under the FOIA, and they will not be placed in the public docket of this NPRM. Submissions containing CBI should be sent to Molly Sturgis, 2200 South 216th Street, Des Moines, WA 98198. Any commentary that the FAA receives which is not specifically designated as CBI will be placed in the public docket for this rulemaking.

The FAA was notified of multiple events involving PW PW4000-94 engines in which tailpipe fire, loss of thrust control, or engine in-flight shutdown occurred. A manufacturer investigation revealed that these events were caused by undetected deterioration of Pb sensors due to epoxy deterioration, which can lead to erroneous Pb sensor measurements and incorrect fuel commands. This condition, if not addressed, could result in engine fire, loss of thrust control, and engine in-flight shutdown.

The FAA is issuing this NPRM after determining that the unsafe condition described previously is likely to exist or develop on other products of the same type design.

This proposed AD would require replacing Pb sensors within certain compliance times.

The FAA estimates that this AD, if adopted as proposed, would affect 210 engines installed on airplanes of U.S. registry.

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

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

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

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

For the reasons discussed above, I certify this proposed regulation:

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

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

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

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

The FAA invites you to send any written relevant data, views, or arguments about this proposal. Send your comments using a method listed under the ADDRESSES section. Include “Docket No. FAA-2026-4642; Project Identifier MCAI-2024-00705-T” at the beginning of your comments. The most helpful comments reference a specific portion of the proposal, explain the reason for any recommended change, and include supporting data. The FAA will consider all comments received by the closing date and may amend this proposal because of those comments.

Except for Confidential Business Information (CBI) as described in the following paragraph, and other information as described in 14 CFR 11.35, the FAA will post all comments received, without change, to regulations.gov , including any personal information you provide. The agency will also post a report summarizing each substantive verbal contact received about this NPRM.

CBI is commercial or financial information that is both customarily and actually treated as private by its owner. Under the Freedom of Information Act (FOIA) (5 U.S.C. 552), CBI is exempt from public disclosure. If your comments responsive to this NPRM contain commercial or financial information that is customarily treated as private, that you actually treat as private, and that is relevant or responsive to this NPRM, it is important that you clearly designate the submitted comments as CBI. Please mark each page of your submission containing CBI as “PROPIN.” The FAA will treat such marked submissions as confidential under the FOIA, and they will not be placed in the public docket of this NPRM. Submissions containing CBI should be sent to Christopher Spencer, Aviation Safety Engineer, FAA, 1600 Stewart Avenue, Suite 410, Westbury, NY 11590; phone: 516-228-7300; email: 9-avs-nyaco-cos@faa.gov. Any commentary that the FAA receives which is not specifically designated as CBI will be placed in the public docket for this rulemaking.

Transport Canada, which is the aviation authority for Canada, has issued Transport Canada AD CF-2024-39, dated November 29, 2024 (Transport Canada AD CF-2024-39) (also referred to as the MCAI), to correct an unsafe condition for all Bombardier, Inc., Model CL-600-1A11 (600), CL-600-2A12 (601), and CL-600-2B16 (601-3A, 601-3R, and 604 Variants) airplanes. The MCAI states that a Model CL-600-2B16 airplane experienced an in-flight uncommanded, unarrested flaps movement from 0 to 45 degrees accompanied by a FLAPS FAIL caution message. The airplane returned to the departure airport without further incident. The flaps control system should have stopped the flaps at 3 degrees; however, a failed retract relay prevented the system from arresting the uncommanded movement. The uncommanded and unarrested flap movement, if not addressed, could result in loss of control of the airplane.

The FAA is proposing this AD to address the unsafe condition on these products. You may examine the MCAI in the AD docket at regulations.gov under Docket No. FAA-2026-4642.

Transport Canada issued related Transport Canada AD CF-2023-07, dated February 10, 2023 (Transport Canada AD CF-2023-07), as an interim action to address the failure of the flap control system to arrest the uncommanded flap extension. The FAA issued AD 2023-17-06, Amendment 39-22532 (88 FR 63004, September 14, 2023) (AD 2023-17-06), to address Transport Canada AD CF-2023-07. AD 2023-17-06 requires initial and repetitive operational tests of the flap control system. The FAA issued this AD as a standalone AD as the required actions are separate from each other.

Transport Canada AD CF-2024-39 specifies procedures for revising the AFM to provide the flightcrew with procedures to follow in the event of an uncommanded, unarrested flap movement. This material is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

These products have been approved by the civil aviation authority of another country and are approved for operation in the United States. Pursuant to the FAA's bilateral agreement with this State of Design Authority, that authority has notified the FAA of the unsafe condition described in the MCAI referenced above. The FAA is issuing this NPRM after determining that the unsafe condition described previously is likely to exist or develop in other products of the same type design.

This proposed AD would require accomplishing the actions specified in Transport Canada AD CF-2024-39 described previously, except for any differences identified as exceptions in the regulatory text of this proposed AD.

Transport Canada AD CF-2024-39 requires operators to “advise all flight crews” of revisions to the AFM, and “thereafter operate the aeroplane accordingly.” However, this proposed AD would not specifically require those actions as those actions are already required by FAA regulations. FAA regulations require operators furnish to pilots any changes to the AFM (for example, 14 CFR 121.137), and to ensure the pilots are familiar with the AFM (for example, 14 CFR 91.505). As with any other flightcrew training requirement, training on the updated AFM content is tracked by the operators and recorded in each pilot's training record, which is available for the FAA to review. FAA regulations also require pilots to follow the procedures in the existing AFM including all updates.

In the FAA's ongoing efforts to improve the efficiency of the AD process, the FAA developed a process to use some civil aviation authority (CAA) ADs as the primary source of information for compliance with requirements for corresponding FAA ADs. The FAA has been coordinating this process with manufacturers and CAAs. As a result, the FAA proposes to incorporate Transport Canada AD CF-2024-39 by reference in the FAA final rule. This proposed AD would, therefore, require compliance with Transport Canada AD CF-2024-39 in its entirety through that incorporation, except for any differences identified as exceptions in the regulatory text of this proposed AD. Material required by Transport Canada AD CF-2024-39 for compliance will be available at regulations.gov under Docket No. FAA-2026-4642 after the FAA final rule is published.

The FAA estimates that this AD, if adopted as proposed, would affect 610 airplanes of U.S. registry. The FAA estimates the following costs to comply with this proposed AD:

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

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

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

For the reasons discussed above, I certify this proposed regulation:

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

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

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

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

The Drug Enforcement Administration (DEA) proposes to schedule diphenidine (1-(1,2-diphenylethyl)piperidine) in schedule I of the Controlled Substances Act (CSA), including its salts, isomers, and salts of isomers whenever the existence of such salts, isomers, and salts of isomers is possible within the specific chemical designation.

All comments received in response to this docket are considered part of the public record. DEA will make comments available for public inspection online at https://www.regulations.gov, unless reasonable cause is given . Such information includes personal or business identifiers (such as name, address, state or federal identifiers, etc.) voluntarily submitted by the commenter.

Commenters submitting comments which include personal identifying information (PII), confidential, or proprietary business information that the commenter does not want to be made publicly available should submit two copies of the comment. One copy must be marked “CONTAINS CONFIDENTIAL INFORMATION” and should clearly identify all PII or business information the commenter does not want to be made publicly available, including any supplemental materials. DEA will review this copy, including the claimed PII and confidential business information, in its consideration of comments. The second copy should be marked “TO BE PUBLICLY POSTED” and must have all claimed confidential PII and business information already redacted. DEA will post only the redacted comment on https://www.regulations.gov for public inspection. DEA generally will not redact additional information contained in the comment marked “TO BE PUBLICLY POSTED.” The Freedom of Information Act applies to all comments received.

For easy reference, an electronic copy of this document and supplemental information to this proposed rule are available at https://www.regulations.gov.

Pursuant to 21 U.S.C. 811(a), this action is a formal rulemaking “on the record after opportunity for a hearing.” Such proceedings are conducted pursuant to the provisions of the Administrative Procedure Act (APA). 1 Interested persons, as defined in 21 CFR 1300.01(b), may file requests for a hearing in conformity with the requirements of 21 CFR 1308.44(a) and 1316.47(a), and such requests must:

(1) state with particularity the interest of the person in the proceeding;

(2) state with particularity the objections or issues concerning which the person desires to be heard; and

(3) state briefly the position of the person regarding the objections or issues.

Any interested person may file a waiver of an opportunity for a hearing or to participate in a hearing in conformity with the requirements of 21 CFR 1308.44(c), together with a written statement of position on the matters of fact and law involved in any hearing. 2

All requests for a hearing and waivers of participation, together with a written statement of position on the matters of fact and law involved in such hearing, must be sent to DEA using the address information provided above. The decision whether a hearing will be needed to address such matters of fact and law in the rulemaking will be made by the Administrator. If a hearing is needed, DEA will publish a notice of hearing on the proposed rulemaking in the Federal Register . 3 Further, once the Administrator determines a hearing is needed to address such matters of fact and law in rulemaking, he will then designate an Administrative Law Judge (ALJ) to preside over the hearing. The ALJ's functions shall commence upon designation, as provided in 21 CFR 1316.52.

In accordance with 21 U.S.C. 811 and 812, the purpose of a hearing would be to determine whether diphenidine meets the statutory criteria for placement in schedule I, as proposed in this rulemaking.

The CSA provides that proceedings for the issuance, amendment, or repeal of the scheduling of any drug or other substance may be initiated by the Attorney General (delegated to the Administrator of DEA pursuant to 28 CFR 0.100) on her own motion, at the request of the Secretary of Health and Human Services (HHS), or on the petition of an interested party. 4 This proposed action is initiated on the Administrator's own motion and supported by, inter alia, a recommendation from the then-Assistant Secretary for Health of the Department of HHS (Assistant Secretary) and an evaluation of all other relevant data by DEA. If finalized, this action would impose the regulatory controls and administrative, civil, and criminal sanctions applicable to schedule I controlled substances on persons who handle or propose to handle diphenidine.

In addition, the United States is a party to the 1971 United Nations Convention on Psychotropic Substances (1971 Convention), February 21, 1971, 32 U.S.T. 543, 1019 U.N.T.S. 175, as amended. Procedures respecting changes in drug schedules under the 1971 Convention are set forth in 21 U.S.C. 811(d)(2)-(4). When the United States receives notification of a scheduling decision pursuant to Article 2 of the 1971 Convention indicating that a drug or other substance has been added to a schedule specified in the notification, the Secretary of HHS (Secretary), 5 after consultation with the Attorney General, shall first determine whether existing legal controls under subchapter I of the CSA and the Federal Food, Drug, and Cosmetic Act meet the requirements of the schedule specified in the notification with respect to the specific drug or substance. 6 In the event that the Secretary did not consult with the Attorney General, and the Attorney General did not issue a temporary order, as provided under 21 U.S.C. 811(d)(4), the procedures for permanent scheduling set forth in 21 U.S.C. 811(a) and (b) control.

Pursuant to 21 U.S.C. 811(a)(1), the Attorney General (as delegated to the Administrator of DEA) may, by rule, add to such a schedule or transfer between such schedules any drug or other substance, if he finds that such drug or other substance has a potential for abuse, and makes with respect to such drug or other substance the findings prescribed by 21 U.S.C. 812(b) for the schedule in which such drug or other substance is to be placed.

Diphenidine (1-(1,2-diphenylethyl)piperidine) is a dissociative hallucinogen of the 1,2-diarylethylamine class that has been identified in the United States' illicit drug market. It was first synthesized in 1924 but not encountered for recreational use until 2014. Diphenidine has no approved medical use in the United States.

On June 10, 2021, the Secretary-General of the United Nations advised the Secretary of State of the United States that the Commission on Narcotic Drugs (CND), during its 64th Session in April 2021, voted to place diphenidine in Schedule II of the 1971 Convention (CND Decision 64/5). As a signatory to the 1971 Convention, the United States is required, by scheduling under the CSA, to place appropriate controls on diphenidine to meet the minimum requirements of the treaty. The relevant treaty provisions and domestic statutes executing those provisions are below.

To begin, Article 2, paragraph 7(b), of the 1971 Convention sets forth the minimum requirements that the United States must meet when a substance has been added to Schedule II of the 1971 Convention. Pursuant to the 1971 Convention, the United States must require licenses for the manufacture, export and import, and distribution of diphenidine. The CSA's registration requirement as set forth in 21 U.S.C. 822, 823, 957, and 958, as well as implementing regulations in 21 CFR parts 1301 and 1312, set forth this licensing requirement.

In addition, the United States must adhere to specific export and import provisions that are provided in the 1971 Convention. The CSA's export and import provisions established in 21 U.S.C. 952, 953, 957, and 958, and implemented in 21 CFR part 1312, execute these requirements.

Likewise, under Article 13, paragraphs 1 and 2, of the 1971 Convention, a party to the 1971 Convention may notify through the U.N. Secretary-General that it prohibits the importation of a substance in Schedule II, III, or IV of the 1971 Convention. If such notice is presented to the United States, the United States shall take measures to ensure that the named substance is not exported to the country of the notifying party. The CSA's above-mentioned export provisions set forth these procedures.

Further, under Article 16, paragraph 4, of the 1971 Convention, the United States is required to provide annual statistical reports to the International Narcotics Control Board (INCB). Using INCB Form P, the United States shall provide the following information: (1) In regard to each substance in Schedule I and II of the 1971 Convention, quantities manufactured, exported to and imported from each country or region as well as stocks held by manufacturers; (2) in regard to each substance in Schedule III and IV of the 1971 Convention, quantities manufactured, as well as quantities exported and imported; (3) in regard to each substance in Schedule II and III of the 1971 Convention, quantities used in the manufacture of exempt preparations; and (4) in regard to each substance in Schedule II-IV of the 1971 Convention, quantities used for the manufacture of non-psychotropic substances or products.

Lastly, under Article 2, paragraph 7(b)(vi) of the 1971 Convention, the United States must adopt measures in accordance with Article 22 to address violations of any statutes or regulations that are adopted pursuant to its obligations under the 1971 Convention. The United States complies with this provision, as persons acting outside the legal framework established by the CSA are subject to administrative, civil, and/or criminal action.

DEA notes that there are differences between the schedules of substances in the 1971 Convention and the CSA. The CSA has five schedules (schedules I-V) with specific criteria set forth for each schedule. Schedule I is the only possible schedule in which a drug or other substance may be placed if it has high potential for abuse and no currently accepted medical use in treatment in the United States. 7 In contrast, the 1971 Convention has four schedules (Schedules I-IV) but does not have specific criteria for each schedule. The 1971 Convention simply defines its four schedules, in Article 1, to mean the correspondingly numbered lists of psychotropic substances annexed to the Convention and altered in accordance with Article 2.

Pursuant to 21 U.S.C. 811(b), DEA gathered the necessary data on diphenidine and, on January 24, 2022, submitted it to the then-Assistant Secretary for Health of HHS with a request for a scientific and medical evaluation of available information and a scheduling recommendation for diphenidine.

On November 26, 2022, HHS provided DEA a scientific and medical evaluation entitled, “Basis for the Recommendation to Control 1-(1,2-Diphenylethyl)piperidine (Diphenidine) and its Salts in Schedule I of the Controlled Substances Act,” and a scheduling recommendation. Pursuant to 21 U.S.C. 811(b), following consideration of the eight factors and findings related to this substance's abuse potential, legitimate medical use, and safety or dependence liability, HHS recommended that diphenidine and its salts be controlled in schedule I of the CSA under 21 U.S.C. 812(b).

In response, DEA reviewed the scientific and medical evaluation and scheduling recommendation provided by HHS, and all other relevant data, and completed its own eight-factor analysis in accordance with 21 U.S.C. 811(c). Included below is a brief summary of each factor as analyzed by HHS and DEA in their respective eight-factor analyses, and as considered by DEA in this proposed scheduling determination. Please note that both the DEA and HHS analyses, including the evaluation of the eight factors determinative of control along with their supporting data and citations, are available in their entirety under the tab “Supporting Documents” of the public docket for this proposed rule at https://www.regulations.gov under docket number “DEA1155.”

In addition to considering the information HHS provided in its scientific and medical evaluation document for diphenidine, DEA also considered all other relevant data regarding actual or relative potential for abuse of diphenidine. The term “abuse” is not defined in the CSA; however, the legislative history of the CSA suggests the consideration of the following four criteria in determining whether a particular drug or substance has a potential for abuse:  8

a. There is evidence that individuals are taking the drug or drugs containing such a substance in amounts sufficient to create a hazard to their health or to the safety of other individuals or of the community; or

b. There is significant diversion of the drug or other substance from legitimate drug channels; or

c. Individuals are taking the drug or drugs containing such a substance on their own initiative rather than on the basis of medical advice from a practitioner licensed by law to administer such drugs in the course of his professional practice; or

d. The drug or drugs containing such a substance are new drugs so related in their action to a drug or drugs already listed as having a potential for abuse to make it likely that the drug will have the same potentiality for abuse as such drugs, thus making it reasonable to assume that there may be significant diversions from legitimate channels, significant use contrary to or without medical advice, or that it has a substantial capability of creating hazards to the health of the user or to the safety of the community.

DEA reviewed the scientific and medical evaluation provided by HHS and all other data relevant to the abuse potential of diphenidine. These data as presented below demonstrate that diphenidine has a high potential for abuse.

a. There is evidence that individuals are taking the drug or other substance in amounts sufficient to create a hazard to their health or to the safety of other individuals or to the community.

Data show that diphenidine has been encountered by law enforcement in the United States (see Factor 5 below, discussing evidence of abuse in the United States), indicating diphenidine is available for abuse. Case reports of overdoses and fatalities where diphenidine had been positively confirmed in biological fluids have been published. Adverse effects appear similar to those induced by dissociative drugs such as methoxetamine (MXE, schedule I controlled substance), phencyclidine (PCP) (schedule II controlled substance), and ketamine (schedule III controlled substance) and include agitation, disorientation, altered conscious state, tachycardia, an increased respiratory rate, miotic pupils, muscular rigidity, metabolic acidosis, and rhabdomyolysis. Additionally, reports of driving under the influence with diphenidine have been reported in the United States, Japan, Belgium, Italy, Sweden, France, and the United Kingdom. According to HHS, individuals are using diphenidine and taking amounts sufficient to create a hazard to the individual or to the safety of other individuals or to the community.

b. There is significant diversion of the drug or substance from legitimate drug channels.

Diphenidine is not a Food and Drug Administration (FDA)-approved drug for treatment or legally marketed as a drug in the United States, nor marketed in any country in which its use is legal. Legitimate drug channels are limited to research conducted with the drug and manufacturing facilities and to the supply chain that produces the drug for legitimate research. However, HHS noted that FDA is not aware of any diversion from research or legitimate manufacturing activities for diphenidine. Therefore, HHS concluded this characteristic of abuse is not applicable.

c. Individuals are taking the substance on their own initiative rather than on the basis of medical advice from a practitioner licensed by law to administer such substance.

Diphenidine is not approved for medical use and is not formulated or available for clinical use. Diphenidine has been sold on the internet. Case reports of overdoses and fatalities with biological confirmation of diphenidine with toxicological analysis have been reported. Therefore, it is assumed that individuals are taking diphenidine on their own initiative, rather than based on medical advice from a practitioner licensed by law to administer drugs.

d. The drug or substance is so related in its action to a drug or other substance already listed as having a potential for abuse to make it likely that the drug or substance will have the same potential for abuse as such drugs, thus making it reasonable to assume that there may be significant diversion from legitimate channels, significant use contrary to or without medical advice, or that it has a substantial capability of creating hazards to the health of the user or to the safety of the community.

Diphenidine has high-binding affinity and functions as an antagonist at the N -methyl-D-aspartate (NMDA) receptor similar to known drugs of abuse MXE, PCP, and ketamine. HHS notes that in rats, diphenidine disrupts pre-pulse inhibition (PPI) of acoustic startle, an effect indicative of NMDA receptor antagonism. Since diphenidine shares the same NMDA receptor binding and antagonism effects with already listed substances known to have potential for abuse, HHS stated it's reasonable to assume that diphenidine will be subject to significant use contrary to or without medical advice. Based on this assessment DEA expects diphenidine to have a high abuse potential and pose a high risk to public health.

Diphenidine is structurally related to and shares pharmacological properties with PCP and ketamine. Based on non-clinical in vitro studies, diphenidine binds to the glutamatergic NMDA receptor and acts as an antagonist at this receptor with high affinity. Diphenidine also interacts with monoamine transmission through binding at the norepinephrine and dopamine transporters and increasing neurotransmitter transmission. Non-clinical in vivo studies indicate diphenidine produces a similar pharmacological profile to that of other NMDA receptor antagonists assessed via pre-pulse inhibition, locomotor activity, and conditioned place preference assays. Although no clinical studies have been performed for diphenidine, case reports of human exposure show that the effects of diphenidine are similar to abuse of, or intoxication with, ketamine or MXE.

Diphenidine is a substance belonging to the 1,2-diarylethylamine class and shares structural similarities with schedule II and III dissociative hallucinogens, such as PCP and ketamine. Diphenidine (Chemical Abstracts Service Registry Number 36794-52-2) has a molecular formula of C 19 H 23 N and a molecular weight of 265.4 g/mol. Diphenidine is highly lipophilic and high concentrations of diphenidine have been detected in fat tissue in postmortem samples. Diphenidine is metabolized by at least two distinct pathways, glucuronidation and a multi-step process starting with hydroxylation (mono- and bis-hydroxylation), which is followed by methylation of one of the hydroxy groups ( N,N -bis-dealkylation). Cytochrome (CYP) enzymes such as CYP1A2, CYP2B6, CYP2C9, and CYP3A4 are thought to play a role in the metabolism of diphenidine.

As HHS states in its review, there is no currently accepted medical use for diphenidine in treatment in the United States, and a World Health Organization (WHO) critical review states there are no known therapeutic applications. A PubMed search conducted by HHS and DEA did not identify any established therapeutic uses. Thus, DEA concludes that diphenidine has no currently accepted medical use according to established DEA procedures and case law.

Diphenidine was first encountered in the United States by law enforcement in 2014. A limited number of encounters of diphenidine have been reported in the years since (see Factor 5). The WHO reports that diphenidine was first observed in the illicit drug market in 2013. Based on the WHO Critical Review and available scientific and medical literature, HHS noted that diphenidine has been sold on the internet as “herbal blends” and “research chemicals,” and at times promoted as producing a “legal high.” Diphenidine is generally sold in powder form. Anecdotal reports suggest that diphenidine may induce dissociative effects with various routes of administration ( e.g., oral, sublingual, insufflation [snorting], smoking, and intravenous injection). HHS noted that online user reports suggest the onset of action is 10-30 minutes and the duration of action is generally between 2.5 to 6 hours.

Internationally, evidence of abuse of diphenidine initially appeared in 2013, one year earlier than was reported in the United States. Based on the WHO 2020 review of diphenidine, there were 61 total international reports of drug seizures between 2018 to 2020. Additionally, eight countries (including six from the European region, one from the Americas, and one from the Western pacific region) reported that diphenidine was being used by individuals for its psychoactive properties. Data from DEA's National Forensic Laboratory Information System (NFLIS-Drug)  9 indicate that, starting in 2014, diphenidine was found in 22 samples in Indiana and Alabama. Diphenidine has been encountered in 11 states (Alabama, California, Colorado, Florida, Illinois, Indiana, Iowa, Louisiana, New Hampshire, South Dakota, and Texas). These reports show evidence of trafficking, distribution, and abuse of diphenidine in the United States.

Diphenidine was reported in several published toxicology-related cases in several countries outside of the United States, including Japan, Belgium, Italy, Sweden, France, and the United Kingdom. Based on available abuse data, public health risk, and drug trafficking data, the WHO recommended to the United Nations that diphenidine be controlled internationally. In April 2021, the CND voted to place diphenidine into Schedule II of the 1971 Convention.

Diphenidine shares similar mechanisms of action with and produces similar physiological and subjective effects (see Factor 2 for more information) as other schedule II and III hallucinogens, such as PCP and ketamine. Thus, diphenidine poses the same risks to public health as similar hallucinogens. Predominantly, the risks to public health are borne by users ( i.e., hallucinogenic effects, sensory distortion, impaired judgement, strange or dangerous behaviors), but they can affect the general public, as with driving under the influence. There have been reports of distressing responses and death associated with diphenidine in medical literature; however, all have been reported as poly-substance use. Adverse events associated with diphenidine included agitation or agitated delirium, anxiety, dilated pupils, disorientation, dissociation, frothing from the mouth, hypertension, tachycardia, and urinary retention. At least five fatalities have been associated with diphenidine use. Thus, based on the review of both HHS and DEA, serious adverse events that may include death represent a risk to the individual drug users and to public health.

HHS noted that there are no clinical studies evaluating the dependence potential of diphenidine. However, diphenidine has similar pharmacological properties of MXE, PCP, and ketamine, which do have well-demonstrated dependence potential. Thus, the HHS and DEA reviews both concluded that it is probable that diphenidine has a dependence profile similar to these known substances.

Diphenidine is not an immediate precursor of any controlled substance of the CSA, as defined by 21 U.S.C. 802(23).

Based on consideration of the scientific and medical evaluation and accompanying recommendation of HHS, and on DEA's own eight-factor analysis, DEA finds that the facts and all relevant data constitute substantial evidence of potential for abuse of diphenidine. As such, DEA proposes to schedule diphenidine as a schedule I controlled substance under the CSA. This proposed action would also enable the United States to meet its obligations under the 1971 Convention.

The CSA establishes five schedules of controlled substances known as schedules I, II, III, IV, and V. The CSA also outlines the findings required to place a drug or other substance in any particular schedule. 10 After consideration of the analysis and recommendation of the Assistant Secretary for Health of HHS and review of all other available data, the Administrator of DEA, pursuant to 21 U.S.C. 811(a) and 21 U.S.C. 812(b)(1), finds that:

Diphenidine's pharmacological profile, including its high binding affinity and function as an antagonist at the NMDA receptor, is indicative that it has a high potential for abuse. Binding and antagonism to the NMDA receptor are also characteristic of and believed to be important in the subjective and mind-altering effects of other dissociative drugs, such as MXE, PCP, and ketamine, all known drugs that are abused. Published case reports support that the subjective effects and use patterns are similar to other NMDA receptor antagonists that have known high abuse.

Diphenidine is not legally marketed in the United States. As noted in the HHS's review, diphenidine lacks current marketing approval under a new drug application or an abbreviated new drug application and is not subject to an investigational new drug application. There are no known medically approved uses worldwide at this time. There is no evidence that diphenidine has a currently accepted medical use in treatment in the United States. 11

Please note that all comments received in response to this docket are considered part of the public record. The Drug Enforcement Administration (DEA) will make comments available for public inspection online at https://www.regulations.gov, unless reasonable cause is given. Such information includes personal identifying information (such as your name, address, etc.) voluntarily submitted by the commenter.

Commenters submitting comments which include personal identifying information (PII), confidential, or proprietary business information that the commenter does not want to be made publicly available should submit two copies of the comment. One copy must be marked “CONTAINS CONFIDENTIAL INFORMATION” and should clearly identify all PII or business information the commenter does not want to be made publicly available, including any supplemental materials. DEA will review this copy, including the claimed PII and confidential business information, in its consideration of comments. The second copy should be marked “TO BE PUBLICLY POSTED” and must have all claimed confidential PII and business information already redacted. DEA will post only the redacted comment on http://www.regulations.gov for public inspection. DEA generally will not redact additional information contained in the comment marked “TO BE PUBLICLY POSTED.” The Freedom of Information Act applies to all comments received. The Freedom of Information Act applies to all comments received.

For easy reference, an electronic copy of this document and supplemental information to this proposed rule are available at https://www.regulations.gov.

The Controlled Substances Act (CSA) authorizes the Attorney General, by regulation, to exempt from certain provisions of the CSA any compound, mixture, or preparation containing certain nonnarcotic controlled substances if she finds that it is both (1) approved for prescription use, and (2) contains one or more other active ingredients which are not listed in any schedule and which are included in such combinations, quantity, proportion, or concentration as to vitiate the potential for abuse. 1 The Attorney General has delegated this authority to the Administrator of DEA (Administrator). 2 The Administrator may also revoke a previously granted exemption by following the same procedures that are used to evaluate an application for exemption—namely, by publishing in the Federal Register a general notice of the proposed rulemaking (NPRM) for revoking the exemption, permitting interested persons to file written comments on or objections to the proposed revocation, considering any comments submitted, and publishing a final order in the Federal Register that sets forth the findings of fact and conclusions of law upon which the order is based. 3

This notice proposes to revoke the exemption status for certain prescription products previously granted exemption because the National Drug Codes (NDCs) of these products are no longer active and/or the companies that originally filed for their exemption are no longer in existence. If finalized, this action will revoke the exemption status for a number of products and remove them from DEA's Table of Exempted Prescription Products list. While this action would revoke the exemption status, this action should have no effect on these products because they are no longer marketed.

DEA has exempted prescription drug products from certain parts of the CSA when the products meet the requirements for exemption, including the requirement to contain active ingredients believed to vitiate the potential for abuse. The current table of products that have been granted exempted prescription product status, pursuant to 21 CFR 1308.31 and 1308.32, can be found on the DEA Diversion Control Division website. 4

Butalbital is classified as an intermediate acting barbiturate. Butalbital is a schedule III nonnarcotic controlled substance that falls under DEA Administration Controlled Substances Code Number 2100, as it is a derivative of barbituric acid. 5 Originally, some butalbital prescription products were excepted by the Bureau of Drug Abuse Control (BDAC) of the Food and Drug Administration (FDA), the predecessor to the Bureau of Narcotics and Dangerous Drugs and later DEA. A panel of public health physicians and FDA medical officers developed the criteria used to exempt butalbital prescription products by BDAC in 1967. These criteria were based upon the expectation that combining the controlled substance with an amount of counteractive drug sufficient to cause early deterrent side effects would vitiate the potential for abuse. For products containing long or intermediate acting barbiturates in combination with analgesics, the criteria provided that an exception would be granted if, for every 15 mg of barbiturate, the product contained at least (1) 188 mg aspirin; (2) 375 mg salicylamide; or (3) 70 mg phenacetin, acetanilid, or acetaminophen.

Following the establishment of the criteria, DEA approved subsequent applications by new manufacturers based upon the same criteria, whereby the inclusion of these other active ingredients was thought to be in sufficient quantities to vitiate the potential for abuse. The criteria developed in 1967 was originally found to meet the standard for exemption currently described in 21 U.S.C. 811(g)(3)(A), such that if a prescription drug was found to meet the 1967 criteria for exception, then it also met the test to contain an ingredient that vitiated the potential for abuse under the CSA standard.

Currently, there are 189 butalbital products listed by their NDC on DEA's Table of Exempted Prescription Products. Using the FDA's National Drug Code Directory  6 and the U.S. National Institute of Health-National Library of Medicines DailyMed database, 7 DEA determined that 160 of the NDCs correlating to butalbital products on the exempt prescription product list are no longer active and marketed. DEA confirmed with FDA these products are no longer marketed. Therefore, DEA is proposing to remove these inactive products from the exempted prescription product list for clarity and to accurately portray which products are currently on the market. DEA welcomes comments from any company who believes their product is being erroneously removed from the exempt prescription product list because their product is still available for sale.

For reasons detailed above, DEA is removing the following prescription products from DEA's Table of Exempted Prescription Products, as set forth below:

DEA has determined that this proposed rulemaking is not a “significant regulatory action” under section 3(f) of E.O. 12866, Regulatory Planning and Review. This proposed rule has been drafted and reviewed in accordance with E.O. 12866, “Regulatory Planning and Review,” section 1(b), Principles of Regulation and E.O. 13563, “Improving Regulation and Regulatory Review,” section 1(b), General Principles of Regulation. This action is also not subject to E.O. 14192, “Unleashing Prosperity Through Deregulation,” or E.O 14294, “Fighting Overcriminalization in Federal Regulations,” as this action is neither a deregulation nor invokes criminal penalties.

This proposed regulation meets the applicable standards set forth in sections 3(a) and 3(b)(2) of E.O. 12988 to eliminate drafting errors and ambiguity, minimize litigation, provide a clear legal standard for affected conduct, and promote simplification and burden reduction.

This proposed rulemaking does not have federalism implications warranting the application of E.O. 13132. The proposed rule does not have substantial direct effects on the States, on the relationship between the national government and the States, or the distribution of power and responsibilities among the various levels of government.

This proposed rule does not have tribal implications warranting the application of E.O. 13175. It does not 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.

The Administrator, in accordance with the Regulatory Flexibility Act, 8 has reviewed this proposed rule and, by approving it, certifies that it will not have a significant economic impact on a substantial number of small entities. There would be no economic impact because the products being removed from DEA's prescription product exempt list are no longer marketed.

In accordance with the Unfunded Mandates Reform Act (UMRA) of 1995, 9 DEA has determined and certifies that this action would not result in any Federal mandate that may result “in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100,000,000 or more (adjusted annually for inflation) in any 1 year . . . .” Therefore, neither a Small Government Agency Plan nor any other action is required under UMRA of 1995.

Preamble acronyms and abbreviations. Throughout this preamble, the use of “we,” “us,” or “our” is intended to refer to the EPA. We use multiple acronyms and terms in this preamble. While this list may not be exhaustive, to ease the reading of this preamble and for reference purposes, the EPA defines the following terms and acronyms here:

The EPA is proposing to exempt road and intermodal container TRUs from the leak repair requirements promulgated under subsection (h) of the AIM Act and codified at 40 CFR 84.106. In the 2024 rule, “Phasedown of Hydrofluorocarbons: Management of Certain Hydrofluorocarbons and Substitutes Under the American Innovation and Manufacturing Act of 2020,” (hereafter referred to as the 2024 Emissions Reduction and Reclamation (ER&R) rule), among other provisions, the EPA established leak repair requirements. 1 Under these requirements, as of January 1, 2026, owners or operators must comply with leak repair requirements for refrigerant-containing appliances with a full charge size of 15 pounds or more that contain an HFC or certain HFC substitutes, with certain limited exceptions as specified in the regulations. 2 The EPA did not intend to subject refrigerant-containing road and intermodal container TRUs to the leak repair requirements. In this action, the EPA is clarifying the applicability of these requirements and is proposing to exempt refrigerant-containing road and intermodal container TRUs from the ER&R leak repair requirements.

This action proposes to exempt road and intermodal container TRUs from the leak repair requirements in 40 CFR 84.106, which became effective as of January 1, 2026, for refrigerant-containing appliances with a charge size of 15 pounds or more that contain an HFC or certain HFC substitutes. Under this proposal, all road and intermodal container TRUs would be exempt from the leak repair requirements, regardless of their charge size. The proposed exemption, if finalized, would appear as an amendment to subpart C of 40 Code of Federal Regulations (CFR) part 84, by adding paragraph (iii) to 84.106(a)(3), “Leak repair,” to include “Road and intermodal container transport refrigeration units” as exempt from the leak repair requirements. The EPA is not proposing other amendments or seeking comment on any other aspects of the 2024 ER&R rule. The specific proposed regulatory amendment to the leak repair provisions appears at the end of this document as proposed regulatory text.

Submit your comments, identified by Docket ID No. EPA-HQ-OAR-2026-2905, at https://www.regulations.gov (our preferred method), or the other methods identified in the ADDRESSES section. Once submitted, comments cannot be edited or removed from the docket. The EPA may publish any comment received in the public docket. Do not submit to the EPA's docket at https://www.regulations.gov any information you consider to be CBI, Proprietary Business Information (PBI), or other information whose disclosure is restricted by statute. Multimedia submissions (audio, video, etc.) must be accompanied by a written comment. The written comment is considered the official comment and should include discussion of all points you wish to make. The EPA will generally not consider comments or comment contents located outside of the primary submission ( i.e., on the web, cloud, or other file sharing system). Please visit https://www.epa.gov/dockets/commenting-epa-docket s for additional submission methods; the full EPA public comment policy; information about CBI, PBI, or multimedia submissions; and general guidance on making effective comments.

The EPA recognizes that given the nature of this proposed rulemaking, potentially affected entities may wish to submit CBI. CBI should not be submitted through https://www.regulations.gov. For submission of confidential comments or data, please work with the person listed in the FOR FURTHER INFORMATION CONTACT section if submitting a comment containing CBI.

The EPA may hold a virtual public hearing if the Agency receives a request to hold one. Any party requesting a public hearing must notify the contact listed in the FOR FURTHER INFORMATION CONTACT section, which is Annie Kee at email address: kee.annie@epa.gov by 5 p.m. Eastern Daylight Time on or before June 1, 2026. If a virtual public hearing is held, it will take place on or before June 10, 2026 and further information will be provided on the EPA's Hydrofluorocarbon Phasedown website at https://www.epa.gov/climate-hfcs-reduction.

The EPA will make every effort to follow the schedule as closely as possible on the day of the hearing; however, please plan for the hearings to run either ahead of schedule or behind schedule. The EPA anticipates each commenter will have three to five minutes to provide oral testimony. The EPA encourages commenters to provide a copy of their oral testimony electronically by emailing it to kee.annie@epa.gov. The EPA also recommends submitting the text of your oral comments as written comments to the rulemaking docket EPA-HQ-OAR-2026-2905. Written statements and supporting information submitted during the comment period will be considered with the same weight as oral comments and supporting information presented at the public hearing. The EPA may ask clarifying questions during the oral presentations but will not respond to the presentations at that time.

Please note that any updates related to a potential hearing will be posted online at https://www.epa.gov/climate-hfcs-reduction. Please monitor our website or contact Annie Kee, 202-564-2056, kee.annie@epa.gov to determine if a hearing will be held or for any other updates related to any aspects of such hearing. The EPA does not intend to publish a document in the Federal Register announcing the hearing or any related updates.

This action proposes to amend existing regulations. You may be affected by this proposed action if you own, operate, service, or repair road and intermodal container TRUs containing HFCs or their substitutes. The following list identifies regulated entities that may be affected by this rulemaking and their respective North American Industry Classification System (NAICS) code, are:

This list is not intended to be exhaustive but rather to provide a guide for readers regarding entities likely affected by this action. Other types of entities than those listed could also be affected by this action. If you have questions regarding the applicability of this action to a particular entity, consult the person listed in the FOR FURTHER INFORMATION CONTACT section.

The EPA is proposing an exemption for road and intermodal container TRUs from the leak repair requirements in 40 CFR 84.106. The Agency established the leak repair requirements under subsection (h) of the AIM Act in the 2024 ER&R rule. Among other provisions in the 2024 ER&R rule, as of January 1, 2026, owners or operators must comply with leak repair requirements for refrigerant-containing appliances with a full charge size of 15 pounds or more that contain an HFC or certain HFC substitutes, with certain limited exceptions as specified in the regulations. These requirements include leak rate calculation, appliance repair, and leak inspections, among other provisions. In addition, there are applicable recordkeeping and reporting requirements for owners or operators.

In the 2024 ER&R rule, the EPA did not intend for the leak repair requirements to apply to owners or operators of road and intermodal container TRUs, given the Agency understood these appliances are typically designed for a charge size of 15 pounds or less of refrigerant. To avoid any potential confusion regarding the applicability of these requirements, the EPA is proposing to explicitly exempt road and intermodal container TRUs from the leak repair requirements in 40 CFR 84.106. In the Regulatory Impact Analysis (RIA) Addendum supporting the 2024 ER&R rule  3 (hereafter referred to as the 2024 RIA addendum), the EPA clearly demonstrated its understanding that road and intermodal container TRUs have a charge size of 15 pounds or less and therefore were not intended to be subject to the leak repair requirements. 4 Consistent with that understanding, the EPA did not assess the relevant costs and benefits of the final leak repair requirements in the 2024 ER&R rule on road and intermodal container TRUs. This proposed rule is narrow in scope and is expected to primarily affect owners or operators of road and intermodal container TRUs. The EPA is not proposing other amendments or requesting comment on any other aspects of the 2024 ER&R rule.

On December 27, 2020, the AIM Act was enacted as section 103 in Division S, Innovation for the Environment, of the Consolidated Appropriations Act, 2021 (42 U.S.C. 7675). In subsection (k)(1)(A), the AIM Act provides the EPA with the authority to promulgate necessary regulations to carry out the EPA's functions under the Act, including its obligations to ensure that the Act's requirements are satisfied (42 U.S.C. 7675(k)(1)(A)). Subsection (k)(1)(C) of the Act also provides that Clean Air Act (CAA) sections 113, 114, 304, and 307 apply to the AIM Act and any regulations the EPA promulgates under the AIM Act as though the AIM Act were part of Title VI of the CAA (42 U.S.C. 7675(k)(1)(C)). Accordingly, the promulgation of these regulations under the AIM Act is subject to CAA section 307(d) (see 42 U.S.C. 7607(d)(1)(I)) (CAA section 307(d) applies to “promulgation or revision of regulations under subchapter VI of this chapter (relating to stratosphere and ozone protection)”).

The AIM Act authorizes the EPA to regulate HFCs in three main areas: phasing down the production and consumption of listed HFCs; management of these HFCs and their substitutes; and facilitating the transition to next-generation technologies by restricting use of these HFCs in the sector or subsectors in which they are used. This rulemaking concerns a requirement under the second area—establishing certain regulations for HFCs and their substitutes for the purposes of maximizing reclaiming and minimizing releases of HFCs from equipment and ensuring the safety of technicians and consumers. Subsection (h) of the AIM Act is titled “Management of Regulated Substances.” For purposes of maximizing reclaiming and minimizing releases of HFCs from equipment and ensuring the safety of technicians and consumers, subsection (h)(1) directs the EPA to promulgate regulations to control, where appropriate, any practice, process, or activity regarding the servicing, repair, disposal, or installation of equipment that involves a regulated substance, a substitute for a regulated substance, the reclaiming of a regulated substance used as a refrigerant, or the reclaiming of a substitute for a regulated substance used as a refrigerant. 5 The phrase “where appropriate” in subsection (h)(1) provides the EPA discretion to reasonably determine how the regulations under subsection (h)(1) will apply because “where appropriate” clearly leaves the EPA flexibility to determine how to regulate in the context of subsection (h). For additional discussion of the EPA's authorities under subsection (h) of the AIM Act, please refer to the 2024 ER&R rule. 6

The refrigerated transport subsector primarily moves perishable goods ( e.g., food, flowers) and pharmaceuticals at temperatures between −22 °F (−30 °C) and 61 °F (16 °C) by various modes of transportation, including aircraft, roads and railways, vessels, and intermodal containers. A TRU is a type of integrated refrigeration appliance installed on a vehicle or intermodal container to regulate the temperature of the cargo. This proposed action focuses solely on certain TRUs, specifically road and intermodal container TRUs. Rail TRUs are a separate type of appliance from road and intermodal container TRUs and are not covered by this proposed action.

Road TRUs are refrigerant-containing appliances most often used on vans, trucks, and semi-trailers and cool cargo at a particular temperature or at different temperatures simultaneously ( e.g., to transport both fresh and frozen foods). These TRUs are installed on vehicles that operate on roads. Road TRUs often have an integrated power source; however, some smaller units are connected to and powered by the vehicle's main engine. Intermodal container TRUs, which are refrigerated shipping containers, allow uninterrupted storage while being transported on rail, trucks, and vessels. An intermodal container TRU is a refrigerant-containing appliance installed on the exterior of the container or integrated within the container. While some intermodal container TRUs do have an integrated power source, the Agency understands that some intermodal container TRUs may not have an integrated power source. This description of road and intermodal container TRUs is consistent with the EPA's characterization of the subsector in the 2023 final Technology Transitions rule (“Phasedown of Hydrofluorocarbons: Restrictions on the Use of Certain Hydrofluorocarbons Under the American Innovation and Manufacturing Act of 2020”  7 ). The typical charge size for road and intermodal container TRUs can range from 5 to 15 pounds. Recent information from industry indicates that in some instances, the charge size is greater than 15 pounds but is generally 18 pounds or less. 8 Thus, to avoid any potential confusion regarding the applicability of the leak repair requirements, the EPA is proposing to explicitly exempt road and intermodal container TRUs from the leak repair requirements in 40 CFR 84.106. Under this proposed action, all road and intermodal container TRUs would be exempt from the leak repair requirements, regardless of the charge size.

The EPA is proposing an exemption for road and intermodal container TRUs from the leak repair requirements in 40 CFR 84.106. The 2024 ER&R rule implemented regulatory requirements to minimize the release of HFCs and their substitutes from equipment ( e.g., air conditioning and refrigeration appliances) and to maximize the amount of HFCs reclaimed. Among other provisions, the EPA established regulatory requirements for leak repair for certain refrigerant-containing appliances containing HFCs and certain HFC substitutes. 9 Specifically, in 40 CFR 84.106, as of January 1, 2026, owners or operators must comply with leak repair requirements for refrigerant-containing appliances with a full charge size of 15 pounds or more of refrigerant, with certain limited exceptions as specified in the regulations. The leak repair requirements include leak rate calculation, appliance repair, leak inspections, among other provisions. In addition, there are applicable recordkeeping and reporting requirements for owners or operators subject to the leak repair provisions.

In the 2024 ER&R rule, the EPA codified certain limited exemptions from the leak repair requirements. For example, the EPA exempted refrigerant-containing appliances used for the residential and light commercial air conditioning and heat pump subsector from the leak repair provisions in 40 CFR 84.106. 10 The residential and light commercial air conditioning and heat pump subsector is categorized by refrigerant-containing appliances that are used to cool individual rooms, single-family homes, and small commercial buildings. As stated in the preamble to the 2024 ER&R rule, while the majority of refrigerant-containing appliances in this subsector are below the 15-pound charge size threshold for the leak repair requirements, a portion of the refrigerant-containing appliances in this subsector may have charge sizes above 15 pounds. 11 In finalizing the leak repair requirements in 2024 ER&R rule, the EPA determined that it was appropriate to explicitly exempt refrigerant-containing appliances in that subsector from the leak repair requirements. To codify the exemption, under the “Applicability” section of the leak repair requirements, in 40 CFR 84.106(a)(3)(ii), the EPA listed, “Refrigerant-containing appliances used for the residential and light commercial air conditioning and heat pump subsector” as not being covered.

The EPA is using a similar approach for the proposed exemption for road and intermodal container TRUs. In particular, under this proposal, the EPA would explicitly exempt road and intermodal container TRUs from the leak repair requirements. Accordingly, under the “Applicability” section of the leak repair requirements, the EPA would list “Road and intermodal container transport refrigeration units” as being exempt, as a means of exempting refrigerant-containing appliances used for road and intermodal container transport refrigeration units from the leak repair requirements. The regulatory text, if finalized, would appear in 40 CFR 84.106(a)(3)(iii).

The EPA is proposing this amendment because in finalizing the leak repair requirements in the 2024 ER&R rule, the EPA did not intend for road and intermodal container TRUs to be subject to the provisions as the Agency understood the average charge size for these appliances was well under 15 pounds. The EPA clearly demonstrated that understanding in the 2024 RIA addendum and the preamble discussions to the proposed and final ER&R rules. In the 2024 RIA addendum, while the EPA did evaluate the costs and benefits of rail TRUs complying with the leak repair requirements, the Agency did not do the same for road and intermodal container TRUs. Where the EPA discussed affected appliances in both the preambles to the proposed and final 2024 ER&R rules, the Agency explicitly indicated certain TRUs ( e.g., rail) could and would be covered by the leak repair requirements given their expected charge size and without discussing road or intermodal container TRUs as subject.

Stakeholder inquiries earlier this year indicated that there are road and intermodal container TRUs designed for charge sizes over 15 pounds. When notified about these particular TRUs, the Agency initially responded by providing information on the EPA's website that noted as with any appliance, including road and intermodal container TRUs, there may be situations where the appliance is charged, initially or during a servicing event, to a level that is less than or greater than the intended charge size. In addition, the EPA noted for the purposes of 40 CFR 84.106, consistent with the EPA's 2024 RIA addendum, the Agency generally presumes road and intermodal container TRUs have a charge size of 15 pounds or less and intends to implement this provision consistent with this presumption. 12 However, given the EPA's better understanding based on recent information  13 that road and intermodal container TRUs are routinely designed for and/or charged with more than 15 pounds, the Agency is now considering whether amending the regulations to provide an explicit exemption, along the lines of the exemption for residential and light commercial air conditioning, would be appropriate. In addition, the EPA received a petition for reconsideration from Carrier dated April 21, 2026, which the EPA is reviewing, to revise 40 CFR 84.106 to exempt road and intermodal TRUs. 14 In this action, while the Agency is not proposing to exempt TRUs installed on railcars, we are requesting comment on whether this type of appliance should also be exempt from the leak repair requirements.

Under this proposal, all road and intermodal container TRUs, regardless of their charge size, would be exempt from the leak repair requirements in 40 CFR 84.106. The EPA is not proposing amendments or taking comment on any other aspects of the 2024 ER&R rule.

The EPA is including this section on costs and environmental impacts to provide general information about the proposed action. Estimates are considered preliminary, and the Agency is seeking more detailed information on specific costs likely to be avoided through this proposed action. If finalized, the proposed exemption for road and intermodal container TRUs is expected to significantly reduce potential regulatory burden for certain TRU owners and operators, for discrete types of refrigerant-containing appliances ( i.e., road and intermodal container TRUs with more than 15 pounds of refrigerant). The 2024 RIA addendum developed for the 2024 ER&R rule already assumed that road and intermodal container TRUs are not subject to leak repair requirements. However, if the Agency implemented leak repair requirements to apply to road and intermodal container TRUs, then potentially burdensome costs could have resulted.

Within Carrier's petition for rulemaking, Carrier estimates that the potential savings from this action would be $333 million per year, based on monitoring and recordkeeping costs, leak detection and repair (LDAR) inspections, and equipment downtime. 15 The EPA has not fully evaluated the estimated costs provided by Carrier. The EPA's preliminary quantified cost savings from this proposed action is approximately $90 million per year, based on several key assumptions. The EPA assumes there are 360,000 road and intermodal container TRUs with a refrigerant charge size of 15 pounds or more and all of these TRUs would experience an annual compliance cost of $250. The annual costs are based on the estimated annual leak inspection costs included in the 2024 RIA addendum and are based on a loaded labor rate of $58/hour and 4 hours of time, converted to 2024 dollars. This estimate is preliminary, but provides a rough estimate of potential savings for stakeholders to comment on. The EPA recognizes that this estimate does not explicitly include all potential costs ( e.g., recordkeeping and reporting costs), but expects this omission is offset by the assumption that all TRUs will exceed the 10% leak rate threshold and trigger the leak inspection requirements. More discussion of these assumptions is provided below.

The EPA estimates total present value cost savings of approximately $1 billion (using a 3 percent discount rate) or $900 million (using a 7 percent discount rate). These estimates are based the EPA's preliminary cost savings estimate of approximately $90 million per year extended over a 15-year analysis period of 2026 to 2040, expressed in 2024 dollars, discounted to 2026. 16 Over a 25-year period through 2050, the EPA estimates total present value cost savings of approximately $1.5 billion (using a 3 percent discount rate) or $1 billion (using a 7 percent discount rate). Estimates of total present value are based on an assumption that both technology and policy impacts are static and do not change over time.

The EPA's Vintaging Model  17 estimates a current stock of approximately 1.2 million appliances in the road transport and intermodal container subsectors, which contain road and intermodal container TRUs, among other appliances. In the context of the 2024 RIA addendum, the EPA incorrectly assumed that road and intermodal container TRUs have an average charge size of 10 pounds and that all these units have a charge size of 15 pounds or less. This implied a total installed charge of approximately 5,000 metric tons. Recently, stakeholders have provided information indicating that approximately 70% of road and intermodal container TRUs contain more than 15 pounds of refrigerant, or 360,000 units that are in operation in the range of 15 to 18 pounds of charge size. 18 Assuming an average of 17 pounds, this quantity of units would represent a total installed charge of approximately 3,000 metric tons that exceed 15 pounds of charge per unit. In comparison, the total installed charge of all appliances over 15 pounds covered by the leak repair requirements in the 2024 RIA addendum was approximately 312,000 metric tons. While road and intermodal container TRUs are relatively small in terms of total charge size, they are relatively numerous in terms of the number of units.

Under the 2024 ER&R rule leak repair requirements, owners or operators of subject refrigerant-containing appliances are required to calculate leak rates whenever refrigerant is added to appliances, with certain limited exceptions. Owners or operators are required to identify and repair leaks when the leak rate exceeds the applicable leak rate threshold for the appliance, among other provisions. If road and intermodal container TRUs were subject to the leak repair requirements, costs per leak event above the 10% threshold could have ranged from several hundred dollars up to one thousand dollars or more per unit. As detailed in appendix E of the 2024 RIA addendum, the EPA assumed that a leak inspection would require on average 4 hours per appliance per inspection for commercial refrigeration appliances and used a loaded labor rate of $58 per hour. Thus, a single inspection per year would cost approximately $230, expressed in 2022 dollars, or approximately $250 when converted to 2024 dollars. This estimate does not include costs for repair, leak calculations, or recordkeeping and reporting. One stakeholder provided their own cost estimates which totaled $333 million, or approximately $1,000 per unit per year. 19 That estimate assumed higher labor rates, refrigerant monitoring twice per year, leak inspection and repair, and appliance downtime during repairs. The EPA estimates cost savings of this rule of $90 million per year, reflecting 360,000 appliances with per-unit annual costs of $250. Incorporating higher labor costs or additional cost categories would increase the estimate of cost savings. Costs could also be lower for appliances that do not exceed the 10% leak rate threshold.

Estimating costs of leak inspection and repair requirements are complicated by the fact that the appliances will have a distribution of charge sizes and leak rates, and owners or operators would perform cost-effective maintenance and repair on their appliance regardless of regulatory requirements. The 2024 RIA addendum accounted for these issues using distributions along both the charge size and leak dimensions. With regard to costs, the 2024 RIA addendum calculated effective cost of performing repairs six or 10 weeks sooner than otherwise, as opposed to assuming that repairs would not otherwise have been performed. In addition, the 2024 RIA addendum did not assume that requirements brought leak rates to zero, but that leak rates would be reduced. The EPA expects that if the same analysis methodologies are applied to road and intermodal container TRUs that preliminary estimates could be refined. The EPA has not assessed market impacts of this proposal outside of the preliminary engineering cost estimates described above.

The EPA is requesting comment on the proposed exemption for road and intermodal container TRUs from the leak repair requirements in 40 CFR 84.106. Specifically, under this proposed action, all road and intermodal container TRUs would be exempt from the leak repair requirements, regardless of the charge size. The EPA also requests comment on the cost savings and environmental impacts from this action. In addition, we are requesting information on typical equipment leak rates and the range of typical equipment charge sizes for road and intermodal container TRUs. The EPA is also requesting comment on the typical number of repairs that may occur over the course of equipment lifetime that require refrigerant to be added and the costs associated with repairing and recharging TRUs.

Additionally, the EPA is requesting comment on whether rail TRUs ( e.g., TRUs used exclusively on rail cars) should also be explicitly exempted from the leak repair requirements. The EPA requests information on the average charge size of rail TRUs and number of rail TRU appliances in the United States.

Additional information about these statutes and Executive Orders can be found at https://www.epa.gov/laws-regulations/laws-and-executive-orders.

This action is not a significant regulatory action and was therefore not submitted to the Office of Management and Budget (OMB) for review.

This action is expected to be an Executive Order 14192 deregulatory action. This proposed rule is expected to provide burden reduction by clarifying that the leak repair provisions under the 2024 ER&R rule do not apply to road and intermodal container TRUs that contain an HFC or certain HFCs substitutes. This action does not impose additional regulations.

This action does not impose an information collection burden under the PRA because it does not contain any information collection activities.

I certify that this action will not have a significant economic impact on a substantial number of small entities under the RFA. In making this determination, the EPA concludes that the impact of concern for this rule is any significant adverse economic impact on small entities and that the agency is certifying that this rule will not have a significant economic impact on a substantial number of small entities because the rule relieves regulatory burden on the small entities subject to the rule. The change proposed in this rulemaking is deregulatory in nature and clarifies that the EPA's original intent was to exempt road and intermodal container TRUs from the 2024 ER&R rule leak repair provisions. This proposed action does not change any other regulatory requirements under that rulemaking. We have therefore concluded that this action will relieve regulatory burden for all directly regulated small entities.

This action does not contain an unfunded mandate as described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect small governments. The action imposes no enforceable duty on any state, local or Tribal governments or the private sector.

This action does not have federalism implications. It will not have substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government.

This action does not have Tribal implications as specified in Executive Order 13175. The proposed action does not result in any changes to the requirements in 40 CFR part 84 other than clarifying that road and intermodal container TRUs are exempt from the leak repair provisions in 40 CFR 84.106. Thus, Executive Order 13175 does not apply to this action.

The EPA interprets Executive Order 13045 as applying only to those regulatory actions that concern environmental health or safety risks that the EPA has reason to believe may disproportionately affect children, per the definition of “covered regulatory action” in section 2-202 of the Executive Order. Therefore, this action is not subject to Executive Order 13045 because it does not concern an environmental health risk or safety risk. Since this action does not concern human health, EPA's Policy on Children's Health also does not apply.

This action is not subject to Executive Order 13211, because it is not a significant regulatory action under Executive Order 12866.

This rulemaking does not involve technical standards.

For the reasons set forth in the preamble, the EPA proposes to amend 40 CFR part 84 as follows:

I. Statutory Authority

This proposed regulation is being issued under the authority granted to the Secretary of Health and Human Services by the Social Security Act, as amended (42 U.S.C. 301 et seq. ), including titles I, IV-A, IV-D, X, XIV, and XVI(note) of the Social Security Act which authorizes the administration of public assistance, child support enforcement, and other family assistance programs. This rulemaking is further supported by Section 1102 of the Social Security Act (42 U.S.C. 1302), which provides the Secretary with general authority to make and publish regulations necessary for the efficient administration of programs under the Act. These statutory authorities provide the basis for the regulations codified at 45 CFR parts 201, 204, 205, 225, 233, 234, 235, 237, 260, 261, 262, 263, 264, 265, 270, 283, 284, 286, and 287.

45 CFR parts 201, 204, 205, 225, 233, 234, 235, and 237 comprise the core regulatory framework governing the administration of public assistance and related programs authorized under the Social Security Act and administered by HHS, primarily through the ACF. Originally promulgated to implement Aid to Families with Dependent Children (AFDC) and other categorical assistance programs prior to enactment of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) (Pub. L. 104-193), these regulations continue to establish foundational administrative, fiscal, and program integrity requirements applicable to States, Territories, and, where applicable, Tribal agencies operating federally funded assistance programs.

These parts establish State plan requirements, Federal financial participation (FFP) standards, reporting and recordkeeping obligations, hearing and appeals processes, eligibility and payment provisions, and administrative enforcement mechanisms. They include general administrative provisions (Part 201), public assistance reporting requirements (Part 205), financial management standards (Part 201 and related subparts), program-specific requirements for assistance and services (Part 233), and fair hearing and appeals procedures (Part 205). Collectively, these regulations provide the uniform administrative structure under which States, Tribes, and Territories receive and administer Federal funds for cash assistance, child support enforcement, and related benefit programs.

45 CFR parts 260 through 265 establish the regulatory framework for the TANF program, enacted under title IV-A of the Social Security Act as amended by PRWORA in 1996. Originally published in 1999 and subsequently amended, these regulations govern the purposes of TANF (Part 260), work participation requirements (Part 261), eligible and ineligible uses of Federal TANF funds (Part 263), State reporting requirements (Part 265), penalty and corrective action procedures (Part 262), and data collection and verification standards (Part 264).

The TANF regulations define key statutory terms such as “assistance,” “work activities,” and “work-eligible individual,” and establish the methodology for calculating State work participation rates. They also set forth maintenance-of-effort (MOE) requirements, limitations on administrative expenditures, and procedures for determining and appealing financial penalties. Together, these parts provide the accountability and performance measurement structure for the TANF block grant program while preserving State flexibility in program design.

45 CFR part 270, “High Performance Bonus Awards” governs the bonus funds awarded to States for meeting certain TANF measures. The regulations lay out the amount in bonuses provided, explain the measures and what factors ACF uses to determine each state's scores.

45 CFR part 283 “Implementation of Section 403(A)(2) of the Social Security Act Bonus to Reward Decrease in Illegitimacy Ratio” governs the bonuses given to states who lowered illegitimacy. The regulations describe what data a state had to submit to be considered for the bonus, how ACF would consider the data, and the amounts of the bonus.

45 CFR part 284 “Methodology for Determining Whether an Increase in a State or Territory Child Poverty Rate is the Result of the TANF Program” governs the previous requirement under 42 U.S.C. 613(i) for determining child poverty rates. The regulations explain the method of determining child poverty rates and corrective action required if the poverty rate increased by over five percent in a two-year period.

45 CFR part 286 “Tribal TANF Provisions” establishes the regulatory requirements governing the approval and administration of Tribal TANF programs. Promulgated following statutory authorization for Tribal administration of TANF, this part specifies Tribal plan content requirements, funding methodologies, reporting obligations, and procedures for plan amendments and corrective actions. It provides for direct Federal funding to eligible federally recognized Tribes and Tribal consortia and outlines the process for determining Tribal family assistance grant amounts based on historical State expenditures.

45 CFR part 287 “The Native Employment Works (NEW) Program” describes the rules for implementing the program described in section 412(a)(2) of the Social Security Act. This part lists plan requirements, allowable expenditures under the program, and reporting requirements.

Taken together, these regulatory parts form an integrated framework governing the administration, funding, accountability, and oversight of TANF, Tribal TANF, child support enforcement, and related assistance programs. They establish uniform procedures for State and Tribal plans, financial management, reporting, performance measurement, enforcement, and appeals, while implementing statutory requirements designed to promote program integrity, fiscal stewardship, and the effective delivery of services to low-income families.

This NPRM proposes to remove multiple regulations that are either unnecessary or wholly obsolete. These rescissions would impact States, Territories, and Tribal Lead Agencies. The regulations contained in this NPRM to be removed and reserved can be categorized into three groups: those that are duplicative, those that are better suited as a different type of sub-regulatory format, or those that are obsolete.

The duplicative regulations are those that exist yet, carry no impact as the authority and requirements stated in the regulation exist or are stated elsewhere such as in statute. This renders the language found in the regulation to be either duplicative or otherwise generally unnecessary.

The regulations that are better suited to a different format, i.e. as a sub-regulatory document, are those that generally read like a Frequently Asked Questions document or are overly prescriptive and carry technical details that belong in programmatic instruction. These documents are being proposed to be removed and reserved in order to allow for them to be published in the more appropriate format.

Finally, obsolete regulations are those that are outdated. This includes regulations that refer to grant programs that are no longer funded, practices that are no longer followed, or are otherwise no longer relevant.

ACF expects all provisions included in the proposed rule, if finalized, to become effective 30 days from the date of publication of the final rule.

The provisions of this NPRM, once it becomes final, are intended to be severable, such that, in the event a court were to invalidate any particular provision or deem it to be unenforceable, the remaining provisions would continue to be valid. The changes address a variety of issues relevant to the Office of Family Assistance. None of the provisions contained herein are central to an overall intent of the proposed rule, nor are any provisions dependent on the validity of other, separate provisions.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program, following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this Section.

Part 204, which is inclusive of 45 CFR parts 204.1, 204.2, 204.3, and 204.4, was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

Part 225, which is inclusive of 45 CFR parts 225.1, 225.2, and 225.3, was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

This Section was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. Thus, this proposed rule seeks to eliminate this Section.

Part 234, which is inclusive of 45 CFR parts 234.11, 234.60, 234.70, 234.75, 234.120, and 234.130, was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this part.

Part 235, which is inclusive of 45 CFR parts 235.50, 235.60, 235.61, 235.62, 235.63, 235.64, 235.65, 235.66, 235.70, and 235.110, was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this part.

Part 237, which is only inclusive of 45 CFR part 237.50, was established for the AFDC Program which was in effect from 1935 to 1996. However, this program was replaced during the welfare reform era of the 1990s with many of AFDC's former responsibilities now falling under the TANF program following its creation in 1996. AFDC is now defunct. As such, the regulations do not need to remain on the books for an unfunded project. While some provisions relate to the Adult Assistance programs that still operate in Guam, Puerto Rico, and the Virgin Islands, the statute provides sufficient authority for general administrative and procedural operations of these programs to be addressed in sub-regulatory guidance. Thus, this proposed rule seeks to eliminate this part.

This Section is proposed for removal as it does not provide any additional clarity, interpretation, or additional requirements. The removal of this Section will not affect program operations as the scope and authority for TANF are adequately defined elsewhere in the regulatory framework.

This Section defines the term “WtW cash assistance.” This Section is proposed for removal as it relates to the WtW program which has been unfunded since 2004, and therefore inactive for over 20 years. As this Part refers to an inactive program, the removal of this Part will not affect the operations for the TANF program.

This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 602(a)(7), the removal of this Section will not affect program operations for TANF.

This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 602(a)(7)(A), the removal of this Section will not affect program operations for TANF.

This Section is proposed for removal as it refers to an outdated opportunity for states to continue to keep Section 1115 “welfare reform” waivers in place as described under Section 415 of the Social Security Act so long as the waivers were in place on August 22, 1996. This was designed to allow for states to maintain their policies as allowed by the waiver, if they were inconsistent with the amendments made by PRWORA. However, as all of these waivers were for a set period of time, conformity with PRWORA was required at the point of expiration. As such, the last state waiver expired in 2006, thus making any regulations relating to this process obsolete.

This Section is proposed for removal as it refers to an outdated opportunity for states to continue to keep Section 1115 “welfare reform” waivers in place as described under Section 415 of the Social Security Act so long as the waivers were in place on August 22, 1996. This was designed to allow for states to maintain their policies as allowed by the waiver, if they were inconsistent with the amendments made by PRWORA. However, as all of these waivers were for a set period of time, conformity with PRWORA was required at the point of expiration. As such, the last state waiver expired in 2006, thus making any regulations relating to this process obsolete.

This Section is proposed for removal as it refers to an outdated opportunity for states to continue to keep Section 1115 “welfare reform” waivers in place as described under Section 415 of the Social Security Act so long as the waivers were in place on August 22, 1996. This was designed to allow for states to maintain their policies as allowed by the waiver, if they were inconsistent with the amendments made by PRWORA. However, as all of these waivers were for a set period of time, conformity with PRWORA was required at the point of expiration. As such, the last state waiver expired in 2006, thus making any regulations relating to this process obsolete.

This Section is proposed for removal as it refers to an outdated opportunity for states to continue to keep Section 1115 “welfare reform” waivers in place as described under Section 415 of the Social Security Act so long as the waivers were in place on August 22, 1996. This was designed to allow for states to maintain their policies as allowed by the waiver, if they were inconsistent with the amendments made by PRWORA. However, as all of these waivers were for a set period of time, conformity with PRWORA was required at the point of expiration. As such, the last state waiver expired in 2006, thus making any regulations relating to this process obsolete.

This Section is proposed for removal as it refers to an outdated opportunity for states to continue to keep Section 1115 “welfare reform” waivers in place as described under Section 415 of the Social Security Act so long as the waivers were in place on August 22, 1996. This was designed to allow for states to maintain their policies as allowed by the waiver, if they were inconsistent with the amendments made by PRWORA. However, as all of these waivers were for a set period of time, conformity with PRWORA was required at the point of expiration. As such, the last state waiver expired in 2006, thus making any regulations relating to this process obsolete.

This Section is proposed for removal as it refers to an outdated opportunity for states to continue to keep Section 1115 “welfare reform” waivers in place as described under Section 415 of the Social Security Act so long as the waivers were in place on August 22, 1996. This was designed to allow for states to maintain their policies as allowed by the waiver, if they were inconsistent with the amendments made by PRWORA. However, as all of these waivers were for a set period of time, conformity with PRWORA was required at the point of expiration. As such, the last state waiver expired in 2006, thus making any regulations relating to this process obsolete.

This Section is proposed for removal as it refers to an outdated opportunity for states to continue to keep Section 1115 “welfare reform” waivers in place as described under Section 415 of the Social Security Act so long as the waivers were in place on August 22, 1996. This was designed to allow for states to maintain their policies as allowed by the waiver, if they were inconsistent with the amendments made by PRWORA. However, as all of these waivers were for a set period of time, conformity with PRWORA was required at the point of expiration. As such, the last state waiver expired in 2006, thus making any regulations relating to this process obsolete.

This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 602, the removal of this Section will not affect program operations for TANF.

This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 602(a)(1)(A)(ii) and 42 U.S.C. 602(a)(1)(B)(iv), the removal of this Section will not affect program operations for TANF.

This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 608(b), the removal of this Section will not affect program operations for TANF.

This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 608(b)(2), the removal of this Section will not affect program operations for TANF.

This Section states the implications for an individual who receives benefits but does not follow an individual responsibility plan. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 608(b)(3), the removal of this Section will not affect program operations for TANF.

This Section states the penalties for individuals who receive benefits but refuse to work. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 607(e)(1) and 42 U.S.C. 609(a)(14), the removal of this Section will not affect program operations for TANF.

This Section clarifies that a family cannot be penalized if a parent refuses to work because he or she cannot find child care. The Section further identifies penalties for a State if they penalize parents who are covered under this provision. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 607(e)(2) and 42 U.S.C. 609(a)(14), the removal of this Section will not affect program operations for TANF.

This Section declares that any penalty issued by a State against a family for failure to comply with TANF requirements does not represent a reduction in any wage paid to such individual. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 608(c), the removal of this Section will not affect program operations for TANF.

This Section details that each State must achieve at least a 50 percent work participation rate, minus any caseload reduction credit. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 607(a)(1), (b)(1)-(3), the removal of this Section will not affect program operations for TANF.

This Section details that each State must achieve at least a 90 percent two-parent work participation rate, minus any caseload reduction credit. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 607(a)(2), (b)(1)-(3), the removal of this Section will not affect program operations for TANF.

This Section provides a list of what is counted as work activities. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 607(d), the removal of this Section will not affect program operations for TANF.

This Section provides special requirements related to determining monthly work participation rates for instances including individuals in vocational training and individuals under 20 years of age. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 607(c)(2), the removal of this Section will not affect program operations for TANF.

This Section states that a single custodial parent or caretaker relative with a child below the age of six will be considered as engaged in work if they participate in qualified activities for at least 20 hours per week. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 607(c)(2)(B), the removal of this Section will not affect program operations for TANF.

This Section discusses how a welfare reform waiver could impact a State's workforce participation rate. This Section is proposed for removal as it is referring to an inactive practice. The last “welfare reform waiver” expired in 2006, thus making this Section outdated and obsolete. Therefore, the removal of this Section will not affect program operations for TANF.

This Section discusses that States are eligible to receive additional penalties for improperly imposing penalties on individuals. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 607(e) and 42 U.S.C. 609(a)(14), the removal of this Section will not affect program operations for TANF.

This Section discusses what other safeguards exist to ensure that participants in work activities are not displacing other workers. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 607(f), the removal of this Section will not affect program operations for TANF.

This Section discusses how a welfare reform waiver could impact a State's penalty liability in relation to this Part. This Section is proposed for removal as it is referring to an inactive practice. The last “welfare reform waiver” expired in 2006, thus making this Section outdated and obsolete. Therefore, the removal of this Section will not affect program operations for TANF.

This Section discusses that the general TANF definitions found in Part 260 apply to this Part as well. This Section is proposed for removal as it cites back to 45 CFR 260.30 which already states that “the following definitions apply under parts 260 through 265 of this chapter.” In other words, Part 260 establishes that those definitions are used throughout the subsequent five parts. Therefore, there is no need to restate that the definitions from 260 are utilized in Part 262. As this Section is duplicative, its removal will not affect program operations for TANF.

This Section details a list of TANF fiscal penalties that can be imposed on States. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 609, the removal of this Section will not affect program operations for TANF.

This Section describes the amount of money States are required to spend annually to meet the basic MOE requirement of the TANF program. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 609, the removal of this Section will not affect program operations for TANF.

This Section discusses when State funds expended on child care may be counted towards the basic MOE requirement. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 609, the removal of this Section will not affect program operations for TANF.

This Section details what penalties and actions ACF will take when a State fails to meet the basic MOE requirement. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 609, the removal of this Section will not affect program operations for TANF.

This Section details that the reasonable cause and corrective compliance provisions would not prevent a State from penalties for failing to meet the basic MOE requirements as it does not apply. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 609(b)-(c), the removal of this Section will not affect program operations for TANF.

This Section defines terms related to the Individual Development Accounts. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 604(h), the removal of this Section will not affect program operations for TANF.

This Section explains that a State may use Federal TANF funds or WtW dollars to fund IDAs for individuals eligible for TANF. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 604, the removal of this Section will not affect program operations for TANF.

This Section details the restrictions that apply to recipients of IDA funds. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 604, the removal of this Section will not affect program operations for TANF.

This Section defines terms related to this Part. Specifically, it is broken down into two components: (1) that the general TANF definitions found in Part 260 apply to this Part as well, and ((2) lists several additional terms not defined in Part 260. The first component of this Section is proposed for removal as it cites back to 45 CFR 260.30 which already states that “the following definitions apply under parts 260 through 265 of this chapter.” In other words, Part 260 establishes that those definitions are used throughout the subsequent five parts. Therefore, there is no need to restate that the definitions from 260 are utilized in Part 264.

The second component of this Part is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 603 and 608, the removal of this Section will not affect program operations for TANF.

This Section explains that if a State does not comply with the five-year assistance limit that they will face a penalty of a reduction of five percent of the adjusted State Family Assistance Grant (SFAG). This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 609(a)(9), the removal of this Section will not affect program operations for TANF.

This Section explains that when a State fails to repay a Federal loan that the SFAG payable for the succeeding fiscal year will deduct the amount of the loan balance plus all accumulated interest. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 609(a)(6), the removal of this Section will not affect program operations for TANF.

This Section discusses that States must enact policies that prevent TANF or MOE funds from being used towards expenditures at liquor stores, casinos, and strip clubs. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 608(a)(12), the removal of this Section will not affect program operations for TANF.

This Section details that a State's failure to implement policies that restrict usage of TANF or MOE funds for liquor stores, casinos, or strip clubs will be subject to additional penalties. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 608, the removal of this Section will not affect program operations for TANF.

This Section discusses the qualifications to receive a provisional payment of contingency funds and explicitly restricts the Tribes and Territories from being eligible to be deemed as a “needy State.” This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 603(b), the removal of this Section will not affect program operations for TANF.

This Section discusses the methodology for calculating the amount of the provisional payment of contingency fund that can be awarded to a State. This Section is proposed for removal as it contradicts the plain reading of the language found at 42 U.S.C. 603(b). Therefore, removing this Section will return the operation of the program to be in line with legislative intent.

This Section discusses the requirement for Territories to submit information as required by other regulations on the quarterly Territorial Financial Report. The requirement of a quarterly report is procedural and therefore better addressed in sub-regulatory guidance. Therefore, ACF is proposing to remove this Section.

This Section states that Territories may appeal a disallowance to the Departmental Appeals Board. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 610, the removal of this Section will not affect program operations for TANF.

This Section details that each State must submit their reports electronically based on format specifications prescribed by HHS. This Section is proposed for removal as HHS has the right to require reports be completed in a particular format irrespective of this regulation. Furthermore, as this Section states that the format will be specified by HHS, it already concedes that this regulation is not penultimate in the sense that there are other guidance documents that further detail report filing specifications. Therefore, the removal of this Section will not affect the operations for the TANF program.

Part 270, which is inclusive of 45 CFR parts 270.1, 270.2, 270.3, 270.4, 270.5, 270.6, 270.7, 270.8, 270.9, 270.10, 270.11, 270.12, and 270.13, are the regulatory provisions relating to the bonus to reward high performing States in the TANF program. This Part is proposed for removal as the High Performance Bonus (HPB) had its funding eliminated through the Deficit Reduction Act of 2005. Therefore, this program has been unfunded and inactive for over 20 years. As this Part refers to an inactive program, the removal of this Part will not affect the operations for the TANF program.

Part 283, which is inclusive of 45 CFR parts 283.1, 283.2, 283.3, 283.4, 283.5, 283.6, 283.7, 283.8, and 283.9, are the regulatory provisions relating to the “Bonus to Reward Decrease in Illegitimacy Ratio”. This Part is proposed for removal as this bonus program was eliminated through the Deficit Reduction Act of 2005. Therefore, this program has been unfunded and inactive for over 20 years. As this Part refers to an inactive program, the removal of this Part will not affect the operations for the TANF program.

Part 284, which is inclusive of 45 CFR parts 284.10, 284.11, 284.15, 284.20, 284.21, 284.30, 284.35, 284.40, 284.45, and 284.50, are the regulatory provisions relating to the methodology for determining the child poverty rates in the States and Territories. This Part is proposed for removal as the Consolidated Appropriations Act of 2017 rewrote Section 413 of the Social Security Act which removed the provision authorizing this, Part. Therefore, this regulation is inactive and therefore no longer needs to exist. Thus, the removal of this Part will not affect the operations of the TANF program.

This Section discusses how either an Indian Tribe or an intertribal consortium of eligible Indian Tribes can apply to operate a Tribal Family Assistance Program (TFAP). This Section is proposed for removal because it imposes no requirements on Tribes and merely informs them of ACF policy. As a statement of policy, ACF believes this provision would be more appropriate for sub-regulatory guidance. The removal of this Section will not affect program operations for TANF.

This Section states that Tribes are not required to obligate all Tribal Family Assistance Grant (TFAG) funds by the end of the fiscal year in which they are awarded. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 604, the removal of this Section will not affect program operations for TANF.

This Section discusses the instances in which WtW cash assistance is counted towards a Tribe's TANF time limit. This Section is proposed for removal as it relates to the WtW program which has been unfunded since 2004, and therefore inactive for over 20 years. As this Part refers to an inactive program, the removal of this Part will not affect the operations for the TANF program.

This Section details the special requirements and allowances available to the State of Alaska. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 612, the removal of this Section will not affect program operations for TANF.

This Section describes that HHS will work with Tribes in Alaska as well as the State of Alaska to develop a process for the development and amendment of the comparability criteria. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 612, the removal of this Section will not affect program operations for TANF.

This Section discusses that the two penalties that cannot be excused are the penalty for failure to repay a Federal loan and a penalty for failure to replace any reduction in the TFAG from other penalties. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 609 and in other regulations at 45 CFR 286.195, the removal of this Section will not affect program operations for TANF.

This Section describes the impacts of data collection and reporting for 102-477 Tribes. This Section is proposed for removal as it restates the requirements for Tribes to comply with the reporting requirements as is already stated in Public Law 102-477. Therefore, this language is duplicative and thus, the removal of this Section will not affect the operation of the TANF program.

This Section states the general purpose and scope of the NEW program. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 612, the removal of this Section will not affect the operations of the NEW Program.

This Section discusses which Tribes are eligible to apply for the NEW Program. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 612, the removal of this Section will not affect the operations of the NEW Program.

This Section clarifies that a Public Law 102-477 Tribe can operate a NEW Program so long as the Tribe is an “eligible Indian tribe.” This Section is proposed for removal because it is merely an interpretation Public Law 102-477, as amended, and 42 U.S.C. 612(a)(2), which authorizes the NEW program. The removal of this Section will not affect the operation of the NEW Program.

This Section details the amount of funds that each Tribe will receive under PRWORA for the NEW Program. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 612, the removal of this Section will not affect the operations of the NEW Program.

This Section states that there are no matching fund requirements with the NEW Program. This Section is proposed for removal as the authorizing statute makes no mention of matching requirements, which therefore does not authorize HHS from imposing such requirements. This Section may be better suited in a sub-regulatory frequently asked questions document. The removal of this Section will not affect program operations for the NEW Program.

This Section states that NEW Program grantees are required to comply with other Federal government and HHS-wide regulations regarding auditing and financial requirements. This Section is proposed for removal as irrespective of this Section, NEW Program grantees are required to comply with such regulations. The removal of this Section will not result in grantees no longer having to abide by general financial reporting requirements and will not affect program operations for the NEW Program.

This Section states which OMB circulars apply to the NEW Program. This Section is proposed for removal as the circulars listed have since been superseded by the Uniform Guidance found at 2 CFR 200. As such, this Section is stating outdated and inaccurate information. Therefore, this Section is proposed for removal, which will not affect the operation of the NEW Program.

This Section states that Tribes are required to complete certain certifications for the NEW Program. This Section is proposed for removal as the requirement that Tribes attain certain certifications exists in a variety of other locations including in other Federal government-wide statutes as well as the statute authorizing the NEW Program. The removal of this Section will not affect the operation of the NEW Program.

This Section clarifies that a Tribe may operate both a NEW Program as well as a Tribal TANF program so long as they meet the statutory requirements of both programs. Nothing in either authorizing statute indicates that a Tribe is prohibited from operating both programs, with each statute explicitly stating what Tribes are eligible to apply. This Section does not belong in regulation but could serve a useful purpose in a sub-regulatory format, such as a frequently asked questions document. The removal of this Section will not affect the operations of the NEW program or the TANF program.

This Section states that a Tribe that operates both a NEW Program and a Tribal TANF program must submit two separate plans. This Section is proposed for removal as the requirement for grantees to submit a plan is implied by having separate plan requirements in Part 286 (Tribal TANF) and Part 287 (NEW). This Section does not belong in regulation but could serve a useful purpose in a sub-regulatory format, such as a frequently asked questions document. The removal of this Section will not affect the operations of the NEW program or the TANF program.

This Section discusses what provisions of the Social Security Act govern the NEW Program. This Section is proposed for removal as it merely restates statutory language without adding any clarity, interpretation, or additional requirements not already found in statute. As the language is already found at 42 U.S.C. 612, the removal of this Section will not affect the operations of the NEW Program.

This Section lists what other data collection and reporting requirements apply to Public Law 102-477 Tribes that choose to consolidate their NEW Program with other programs. This Section is proposed for removal because it is outdated and unnecessary. Reporting requirements under Public Law 102-477 are governed by 25 U.S.C. 3410 and are the responsibility of the Bureau of Indian Affairs (BIA) in coordination with each agency. Therefore, guidance on reporting could be issued by BIA. The removal of this Section will not affect the operation of the NEW Program.

This Section lists what other data collection and reporting requirements apply to Tribes that operate both a NEW Program as well as a Tribal TANF program. This Section is proposed for removal as it states that each Tribe must comply with the specific requirements found in the respective program statutes and regulations. That requirement is true regardless of this Section. The removal of this Section will not affect the operation of either the NEW Program or the TANF program.

Under the Paperwork Reduction Act (44 U.S.C. 3501 et seq., as amended) (PRA), all Departments are required to submit to the Office of Management and Budget (OMB) for review and approval any reporting or recordkeeping requirements inherent in a proposed or final rule. This NPRM does not contain any information collections requiring OMB approval under the PRA and, therefore, will not create any new paperwork burdens or modify existing burdens subject to OMB review.

Executive Order 13132 requires federal agencies to consult with State and local government officials if they develop regulatory policies with federalism implications. Federalism is rooted in the belief that issues that are not national in scope or significance are most appropriately addressed by the level of government close to the people. This proposed rule would not have substantial direct impact on the States, on the relationship between the federal government and the States, or on the distribution of power and responsibilities among the various levels of government. This NPRM would not pre-empt State law. The changes proposed in the NPRM are removing unnecessary and obsolete regulations from the Office of Family Assistance rules. Therefore, in accordance with Section 6 of Executive Order 13132, it is determined that this action does not have sufficient federalism implications to warrant the preparation of a federalism summary impact statement.

Assessment of Federal Regulations and Policies on Families Section 654 of the Treasury and General Government Appropriations Act of 1999 (Pub. L. 105-277) requires federal agencies to determine whether a policy or regulation may negatively affect family well-being. If the agency determines a policy or regulation negatively affects family well-being, then the agency must prepare an impact assessment addressing seven criteria specified in the law. HHS believes it is not necessary to prepare a family policymaking assessment because the actions proposed in this NPRM will not have any impact on the autonomy or integrity of the family as an institution.

We have examined the impacts of the proposed rule under Executive Order 12866, Executive Order 13563, Executive Order 14192, the Regulatory Flexibility Act (5 U.S.C. 601-612), and the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4).

Executive Orders 12866 and 13563 direct us to assess all benefits and costs of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits. Rules are “significant” under Executive Order 12866 Section 3(f)(1) if they “have an annual effect on the economy of $100 million or more; or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local or tribal governments or communities.” 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 ten prior regulations.” The Office of Information and Regulatory Affairs (OIRA) has determined that this proposed rule is not a significant action under Executive Order 12866 Section 3(f). This analysis indicates that the proposed rule, if finalized would be a deregulatory action as defined by Section 3 of Executive Order 14192.

The Regulatory Flexibility Act (RFA) requires agencies to consider the impact of their regulatory proposals on small entities. Because this is simply repealing obsolete and unnecessary language, we propose to certify that the proposed rule would not have a significant economic impact on a substantial number of small entities.

The Unfunded Mandates Reform Act of 1995 (UMRA) generally requires that each agency conduct a cost-benefit analysis; identify and consider a reasonable number of regulatory alternatives; and select the least costly, most cost effective, or least burdensome alternative that achieves the objectives of the rule before promulgating any proposed or final rule that includes a Federal mandate that may result in expenditures of more than $100 million (adjusted for inflation) in at least one year by State, local, and tribal governments, in the aggregate, or by the private sector. Each agency issuing a rule with relevant effects over that threshold must also seek input from State, local, and tribal governments. The current threshold after adjustment for inflation is $193 million, using the most current (2025) Implicit Price Deflator for the Gross Domestic Product. This proposed rule would not result in an expenditure in any year that meets or exceeds this amount.

Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, requires agencies to consult with Indian Tribes when regulations 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. Consultation and Coordination With Indian Tribal Governments, 65 FR 67249. Similarly, ACF's Tribal Consultation Policy says that consultation is triggered for a new rule adoption that significantly affects tribes, meaning the new rule adoption has substantial direct effects on one on more Indian tribes, on the amount or duration of ACF program funding, on the delivery of ACF programs or services to one or more Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. However, as this is a deregulatory action, per OMB M-25-36, Streamlining the Review of Deregulatory Actions, this action presumptively does not trigger the consultation requirements of Executive Order 13175. ACF is nevertheless committed to consulting with Indian Tribes and Tribal leadership on this action to the extent practicable and permitted by law.

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 201 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 204 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 205 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 225 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 233 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 234 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 235 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 237 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 260 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 261 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 262 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 263 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 264 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 265 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 270 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 283 as follows:

Under the authority in 42 U.S.C. 1302, and for the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 284 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 286 as follows:

For the reasons set forth in the preamble, ACF proposes to amend 45 CFR part 287 as follows:

The Coast Guard views public participation as essential to effective rulemaking and will consider all comments and material received during the comment period. Your comment can help shape the outcome of this rulemaking. If you submit a comment, please include the docket number for this rulemaking (USCG-2022-0471), indicate the specific section of this document to which each comment applies, and provide a reason for each suggestion or recommendation.

Submitting comments. We encourage you to submit comments by going to www.regulations.gov. Type USCG-2022-0471 in the search box and click “Search.” Next, look for this document in the Search Results column, and click on it. Then click on the Comment option. If you cannot submit your material by using www.regulations.gov, call or email the person in the FOR FURTHER INFORMATION CONTACT section of this proposed rule for alternate instructions.

Viewing material in the docket. To view documents mentioned in this proposed rule as being available in the docket, find the docket as described in the previous paragraph, and then select “Supporting & Related Material” in the Document Type column. Public comments will also be placed in our online docket and can be viewed by following instructions on the Frequently Asked Questions (FAQ) web page, available at www.regulations.gov/faq. That page also explains how to subscribe for email alerts that will notify you when comments are posted or if a final rule is published. We review all comments received. We may choose not to post off-topic, inappropriate, or duplicate comments that we receive.

Personal information. We accept anonymous comments. Comments we post to www.regulations.gov will include any personal information you have provided. For more about privacy and submissions in response to this document, see the Department of Homeland Security's eRulemaking System of Records notice (85 FR 14226, March 11, 2020).

Public meeting. We do not plan to hold a public meeting, but we will consider doing so if we determine from public comments that a meeting would be helpful. We would issue a separate Federal Register notice to announce the date, time, and location of such a meeting.

The Coast Guard is required to inspect certain vessels to ensure they are “equipped with proper appliances for lifesaving, fire prevention, and firefighting.” 46 U.S.C. 3305(a)(1)(B). To carry out these inspections, in accordance with Section 3306 of Title 46 United States Code (U.S.C.), the Coast Guard prescribes regulations for the design, construction, alteration, repair, and operation of vessels subject to inspection, and approves safety and other equipment, to secure the safety of life and property at sea. Under this authority, the Coast Guard is authorized to prescribe regulations that apply to, among other systems or equipment, “firefighting equipment, its use, and precautionary measures to guard against fire.”  1 The Secretary of Homeland Security delegated this authority to promulgate regulations under this section to the Commandant of the Coast Guard under Department of Homeland Security (DHS) Delegation No. 00170.1(II)(92)(b), Revision No. 01.4.

The purpose of this proposed rulemaking is to update and codify the type approval criteria for marine foam fire-extinguishing systems. Guidance documents that are outdated, difficult to find, or not publicly available currently contain the existing type approval criteria for these systems. We would update these criteria to reflect advancements in technology, which would lower industry costs. Consolidating hard-to-find criteria and processes into published regulations would improve efficiency and decrease the administrative burden on industry and the government. In addition, codifying these criteria would strengthen the Coast Guard's enforcement mission of ensuring the safety of life and property at sea.

Coast Guard regulations require certain vessels to carry foam fire-extinguishing systems. The requirements for foam fire-extinguishing systems for vessels apply to Tank Vessels, Passenger Vessels, Cargo Vessels, and Mobile Offshore Drilling Units. 2

Foam fire-extinguishing systems are designed to extinguish fires from flammable liquids, such as petroleum or alcohol-based chemicals. These systems produce firefighting foam by mixing a controlled amount of foam concentrate with water to create a foam solution. The foam solution then flows through piping to a foam-making device, where it is mixed with air as it discharges and expands to create firefighting foam. After it is expelled, firefighting foam creates a fluid blanket of air-filled bubbles, which extinguishes fires by sealing the burning liquid surface and preventing oxygen from mixing with volatile vapors from the fuel. The water contained in the foam also provides cooling to aid in extinguishment.

A typical foam system contains several parts: A proportioning station, which consists of a foam concentrate storage tank, and a proportioning system, where water and foam liquid concentrate are mixed to form a foam solution. The foam solution then travels through a network of piping to one or several foam-making devices, where air is introduced, and the solution is agitated to form expanded foam.

Foam-making devices can include foam monitors, foam nozzles, and sprinklers. A foam monitor is a type of foam cannon that is capable of delivering a large flow of foam over a significant distance; it is typically mounted on a fixed or portable base and can swivel or rotate to cover a wide area. A foam monitor can be operated manually, or remotely from a central control room. Hoses with hand-held foam nozzles can be used on tank vessel cargo decks, helidecks, or other locations to manually direct the foam to cover spilled or burning fuel. Sprinklers can be used in a variety of applications that include, but are not limited to, machinery spaces, helidecks, and open deck areas.

Deck foam fire-extinguishing systems, such as tank vessel cargo deck systems, use monitors to apply foam over a large deck area from a safe distance.

Foam systems for machinery spaces are similar to deck foam systems, with the exception that the foam is typically applied through fixed foam spray nozzles or sprinklers, rather than hand-held or monitor nozzles.

In helideck foam systems, the foam solution is directed through hand-held or monitor foam nozzles that can direct foam to fires on the helicopter deck or helicopter fueling areas. Fixed foam spray nozzles located flush in the helideck or around the perimeter of the helideck and fueling area may also be used for helideck protection.

In addition, some vessels and facilities use foam hose reel stations. A foam hose reel station consists of a small foam concentrate tank with a mounted proportioner and a hose reel with hose and a hand-held nozzle. Foam hose reel stations are permitted as excess equipment, principally for the protection of helidecks without fueling facilities, and as an adjunct to fire main systems.

All fire-extinguishing equipment installed on U.S.-flagged vessels must have a type approval issued by the Coast Guard. 3 See generally 46 CFR part 159.

In order to receive type approval, materials and equipment must meet the relevant requirements, complete specified tests, and be enrolled in a quality control or follow-up program. The Mutual Recognition Agreements (MRA) between the United States, the United Kingdom, the European Commission (EC), and the European Free Trade Association do not include fire extinguishing systems and equipment. We do not accept the approvals of other governments, classification societies, Marine Equipment Directive certificates, or EC wheel-marks as equivalent to Coast Guard type approval for these products. Systems intended for special applications or one-time only installations may be accepted on a case-by-case basis without type approval.

The Commandant, Coast Guard Office of Design and Engineering Standards, Lifesaving and Fire Safety Division (CG-ENG-4) reviews items for type approval. The Coast Guard developed type approval testing procedures based on practical marine operating experience to ensure that the fire protection equipment installed on U.S.-flagged vessels will function in the harsh marine environment. Manufacturers seeking type approval for fire protection equipment should first contact the Commandant (CG-ENG-4) to discuss the intended use of their equipment. 4 If the Coast Guard determines that the intended application is suitable, a testing program will be developed, in conjunction with an independent testing laboratory selected by the manufacturer. The Coast Guard does not charge a fee for approvals, but the manufacturer is responsible for paying all laboratory testing and follow-up program service fees.

After the approval testing is completed, the manufacturer submits a report to the Coast Guard for review and concurrence. If the Coast Guard accepts the submittal, a Certificate of Approval (COA) is issued to the manufacturer. A COA is valid for 5 years and can be re-issued if the product, manufacturing process, and the acceptance standard have not been altered, and if the follow-up program is maintained.

Manufacturers must have a follow-up program in order to receive a U.S. Coast Guard type approval. The manufacturer must contract for this follow-up program through a Coast Guard-accepted independent laboratory. The follow-up program enables periodic inspections and tests of factory production to ensure continued compliance with the type approval requirements. Further information on follow-up programs is available in the Coast Guard's Navigation and Vessel Inspection Circular (NVIC) 02-06, “Follow-up Programs for Fire Safety Type-Approved Products.”  5

Finally, the Coast Guard assigns each type approval a dedicated approval series number. Purchasers and inspectors can use this number to confirm that a particular system is Coast Guard-approved.

To receive Coast Guard type approval for a foam fire-extinguishing system, an applicant must submit the following:

• Drawings and specifications for the system;

• The engineering manual that details the operation and maintenance of the system; and

• A prospective test program.

The Commandant (CG-ENG-4) performs a preliminary review to clear the prospective system and test program of any potential shortcomings or flaws that would render the independent laboratory test invalid. Testing may begin once the Coast Guard has pre-approved the prospective test program. The applicant then submits the independent laboratory's test report, along with any changes to the specifications, drawings, and manual made as a result of testing, to the Coast Guard. The Coast Guard reviews the test reports, drawings, specifications, and manual to determine if the system meets all the criteria for foam fire-extinguishing system type approval. If they have, the Coast Guard issues a COA, which is valid for 5 years (46 CFR 159.005-13(a)(2)), provided that the follow-up program remains in effect. Thereafter, upon request of the applicant, the Coast Guard may renew the certificate again as long as the follow-up program remains in effect and there are no changes to the product that would affect its performance.

Currently, the CFR does not have type approval specifications codified for foam systems. Instead, the Coast Guard relies on previously issued guidance and past decisions for these types of systems. These decisions and guidance include Coast Guard policy guidelines and industry consensus standards.

The Coast Guard's existing type approval program for foam fire-extinguishing systems focuses primarily on three elements: the foam concentrate, the foam proportioner, and the foam-making devices. The existing criteria are based on the foam concentrate fire test from the National Fire Protection Association (NFPA) 11, “Standard for Low-, Medium-, and High-Expansion Foam, Annex F,” 2024 Edition, dated December 21, 2023, (originally published in O-F-555C, Federal Specification: “Foam Liquid, Fire Extinguishment, Mechanical”), and the fire, hydraulic, materials, and performance tests and requirements of UL Standard 162, “Foam Equipment and Liquid Concentrates,” Eighth Edition, dated February 23, 2018.

Most foam concentrates for use on petroleum-based chemicals must pass the 100 square feet (ft 2 ) fire test published in NFPA 11, Annex F. This test involves using foam to extinguish a flaming pool fire in a 100 ft 2 pan. Foam concentrates intended to be used on flammable polar solvent chemicals, such as alcohols, must pass an additional set of fire tests. These foam concentrates are tested with the UL 162 50 ft 2 test, using a series of representative fuels that cover various families of flammable chemicals.

Per UL 162, proportioners must pass an induction rate test to demonstrate that the proportioner adds the proper percentage of foam liquid concentrate to the water stream to form foam solution. Foam makers must pass foam quality tests to demonstrate that they can produce foam that is similar to that used to pass the fire test. Proportioners and foam makers must also pass a series of tests to demonstrate their durability, including pressure tests and harsh environment tests.

The Coast Guard's decisions and guidance related to the approval of foam systems include Coast Guard policy guidelines and industry consensus standards that are either located on web-based platforms or physical PDF documents that are only available on request through the CG-ENG-4 office of the Coast Guard. All the documents listed below are available either in the docket (where indicated under the ADDRESSES portion of this preamble, use USCG-2022-0471) or online at the link provided in this section.

Current guidance and decision documents include the following:

• The website of CG-ENG-4 includes foam fire-extinguishing system guidelines and information. 6 This website provides primary guidance on the Coast Guard approval process for marine foam fire-extinguishing systems. The website covers the process for obtaining Coast Guard type approval for foam systems as well as the test criteria used, including the fire test from NFPA 11, Annex F, and the various fire, hydraulic and material tests found in UL 162.

• NVIC 11-82, “Deck Foam System for Polar Solvents”  7 (published 1982). This document contains guidance for the design and review of deck foam fire-extinguishing systems for tank vessels carrying polar solvents. Although primarily concerned with the design criteria for the installation of foam systems on tank vessels carrying polar solvents, some material in NVIC 11-82 addresses the special type approval criteria for the different families of chemicals that may be protected by a type-approved foam system.

• “Fire Fighting Foam Fire Test Criteria” (USCG Fire Test) (published approximately 2010). This document describes in detail the fire test from NFPA 11, Annex F for the approval of foam concentrates. The Coast Guard has regularly distributed this document on request to prospective applicants for Coast Guard type approval of foam fire-extinguishing systems. With incorporation by reference (IBR) of NFPA 11, Annex F by this proposed rule, this document would become obsolete.

• “Criteria for U.S. Coast Guard Approval of Foam Fire Fighting Systems” (USCG Foam Criteria) (published approximately 2010). This document prescribes the approval of whole systems, the use of the NFPA 11, Annex F test for the approval of foam concentrates, hydraulic and durability tests for foam system components, and the elements of the design manual. The Coast Guard has regularly distributed this document on request to prospective applicants for Coast Guard type approval of foam fire-extinguishing systems. It is available in the docket or from the Coast Guard upon request.

• NVIC 02-06, “Follow-Up Programs for Fire-Safety Type-Approved Products”  8 (published 2006). This document provides guidance on the elements of follow-up programs for foam fire-extinguishing systems.

• “Approval Criteria for Deck Integrated Fire Fighting Systems for Helideck Protection” (USCG Heli Criteria) (published approximately 2010). This document outlines the specific type approval criteria for foam fire-extinguishing systems for helidecks, including foam concentrate specifications, hydraulic and durability tests from UL 162, and foam quality limits. The Coast Guard has regularly distributed this document on request to prospective applicants for Coast Guard type approval of helideck foam fire-extinguishing systems. It is available in the docket or from the Coast Guard upon request.

• “Criteria for USCG Approval of Hose Reel Stations” (USCG FHS Criteria) (published 2013). This document outlines the specific type approval criteria for foam hose reel stations that can also be used as hose stations on the fire main system. It includes criteria from UL 162 for fire, hydraulic, foam quality, and durability tests, as well as guidance on components and operational requirements for foam hose reel stations. The Coast Guard has regularly distributed this on request to prospective applicants for Coast Guard type approval of foam fire-extinguishing systems. It is available in the docket or from the Coast Guard upon request.

• “Criteria for USCG Approval of Hose Reel Stations of Helidecks Without Fueling Facilities” (USCG FHS Helideck Criteria) (published 2010). This document outlines the specific type approval criteria for foam hose reel stations on helidecks without fueling facilities. It includes criteria from UL 162 for fire, hydraulic, foam quality, and durability tests, as well as guidance on components and operational requirements for foam hose reel stations. The Coast Guard has regularly distributed this document on request to prospective applicants for Coast Guard type approval of foam hose reel stations used on helidecks. It is available in the docket or from the Coast Guard upon request.

• “Design Manual for Marine Foam Systems” (USCG Manual Requirements) (published approximately 2010). This document outlines the specific type approval criteria for foam fire-extinguishing system manuals. It lists the criteria to be in the manual including component list, hydraulic calculations, foam characteristics, component test data, and sample system calculations. The Coast Guard has regularly distributed this document on request to prospective applicants for Coast Guard type approval of foam systems. It is available in the docket or from the Coast Guard upon request.

The Coast Guard proposes to add two new subparts to Subchapter Q, “Equipment, Construction, and Materials: Specifications and Approval.” These subparts would contain the existing construction criteria and test regimen for the type approval of foam fire-extinguishing systems on Coast Guard-inspected vessels. This rule would consolidate the policies that the Coast Guard uses for approval of foam fire-extinguishing systems into the CFR. Publication would make them more accessible and ease the industry burden of locating the relevant guidance. It would also improve efficiency by streamlining government processes and would reduce government costs by eliminating the need for government employees to manually distribute guidance and answer questions about the approval process.

• Proposed Subpart 46 CFR 162.033—Fixed Foam Fire-Extinguishing Systems

This subpart would contain the existing criteria for the type approval of fixed foam fire-extinguishing systems.

• Proposed Subpart 46 CFR 162.040—Foam Hose Reel Stations

This subpart would contain the existing criteria for the type approval of foam hose reel stations used as excess equipment.

These new subparts would codify type approval procedures for foam fire-extinguishing systems into the CFR. The procedures would be based on the existing type approval procedures and longstanding criteria employed by the Coast Guard for the approval of marine foam fire-extinguishing systems that are discussed in section IV. Background of this preamble. However, this rule proposes some modifications to the existing procedures for type approval. These changes would allow greater flexibility for the manufacturers in the design of these systems and, in some instances, update testing procedures to help reduce the cost and potential environmental impacts of production and certification of foam fire-extinguishing systems, while still ensuring their capability and reliability.

Specific changes are as follows, detailed by subpart:

Table 1 lists the proposed sections of subpart 162.033, the current policy, what the new section proposes, whether the criterion would be a change from current Coast Guard policy guidelines and industry standards, and its potential cost impact. After this table, we explain each section in more detail. Two proposed provisions of 162.033 would produce cost savings: 162.033-7(h) and 162.033-9(a)(10). None of the proposed provisions would add a new cost burden.

Proposed 46 CFR 162.033 would follow a standardized format, laid out as follows:

Proposed 46 CFR 162.033-1, “Scope,” would be unchanged from the scope of current policy.

Proposed 46 CFR 162.033-3, “Definitions,” would list procedural definitions currently used in the type approval program.

Proposed 46 CFR 162.033-5, “Incorporation by reference,” would incorporate by reference widely accepted national and international standards currently used by the Coast Guard to approve foam fire-extinguishing systems. It also would include standards that we are proposing to add as alternatives. Specifically, it would incorporate the following standards:

1. UL 162, “Standards for Safety: Foam Equipment and Liquid Concentrates,” Eighth Edition, dated February 23, 2018, would be incorporated for its alternative fire tests for other hazards that are not on a tanker deck (“other hazards”) and various tests related to the performance and durability of foam system components.

2. NFPA 11, “Standard for Low-, Medium-, and High-Expansion Foam, 2024 Edition,” dated December 21, 2023, would be incorporated for component general requirements and for the Annex F foam concentrate test for tanker decks or other hazards.

3. MSC.1/Circ. 1312/Corr.1, dated November 22, 2011, “Revised Guidelines for the Performance and Testing Criteria, and Surveys of Foam Concentrates for Fixed Fire-Extinguishing Systems,” would be incorporated as an alternative foam concentrate test for other hazards and an alternative formula for synthetic sea water.

4. International Civil Aviation Organization (ICAO) Airport Services Manual (Doc. 9137-AN/898), Fourth Edition, 2014, Part 1 “Rescue and Fire Fighting”, Chapter 8, “Extinguishing Agent Characteristics,” would be incorporated for its Class B and C tests that are proposed as alternative foam concentrate tests for other hazards.

Proposed 46 CFR 162.033-7, “General requirements for fixed foam fire-extinguishing systems,” would list the design, construction, and performance criteria currently used by the Coast Guard for the approval of fixed foam fire-extinguishing systems. Consolidating these policies into the CFR would streamline government processes, improve industry accessibility, and strengthen the enforceability of the design, construction and performance criteria.

Most of these requirements would be essentially unchanged from existing Coast Guard policy and guidance. However, paragraphs (c) and (h) of this proposed CFR section would introduce greater flexibility that differs from current Coast Guard policy and guidance. Paragraph (c) would allow the use of non-UL-listed components (for example, proportioners and foam-making devices). We do not expect any costs or cost savings under (c). Paragraph (h) would allow alternative tests for foam concentrates intended for other hazards. We expect quantified cost savings for laboratories under paragraph (h), and we present these cost savings in section VII. Regulatory Analyses of this proposed rule.

Proposed 46 CFR 162.033-9, “Foam liquid concentrate tests for fixed foam fire-extinguishing systems,” would list the tests required for foam liquid concentrates used in a fixed foam fire-extinguishing system. Consolidating these policies into the CFR would streamline government processes, improve industry accessibility, and strengthen the enforceability of the foam liquid concentrate test criteria.

This section would also contain proposed changes to the existing NFPA 11, Annex F foam concentrate test for tanker decks that would be a benefit to independent laboratories. These proposed changes would reduce requirements and provide flexibility in the test method, which would benefit the manufacturer and the independent laboratory that conduct the tests.

Proposed paragraphs (a)(1) through (a)(3) do not define the test facility as indoor; they only specify the wind speed and ambient, fuel, water, and foam solution temperatures, possibly allowing the test to be conducted outside. This would codify a standard industry practice, where laboratories may choose to conduct tests indoors or outdoors. The Coast Guard required the use of indoor testing facilities in the Fire Fighting Foam Fire Test Criteria published approximately in 2010 but allowed the use of outdoor testing with Coast Guard approval. However, shortly afterwards, the Coast Guard began allowing outdoor testing without the need for approval. Discussions with the affected laboratories reveal that there are no cost savings that would result from this proposed part since laboratories already have the ability to choose indoor or outdoor testing and already have their testing facilities set-up based on their preference.

Proposed paragraphs (a)(4) and (a)(5) would allow for adjustments to nozzle aim and flow during the fire test. These adjustments could make it easier for the foam to extinguish the fire and pass the test. This deregulatory measure would eliminate an unnecessary testing protocol for laboratories and would introduce more flexibility by making the task easier and more efficient to complete. We do not expect these two provisions to produce any new costs or cost savings. See section VII. Regulatory Analyses of this proposed rule for further detail.

Proposed paragraph (a)(6) would allow for multiple formulas of the synthetic sea water needed for the NFPA 11, Annex F fire test. This would benefit independent laboratories by allowing them to choose the formula. This deregulatory measure would eliminate an unnecessary testing protocol for laboratories and introduce more flexibility for industry. We do not expect any new costs or cost savings under this proposed provision.

Proposed paragraphs (a)(7) through (a)(9) would provide expanded detail for the torch, burnback resistance tests methods, and the fire control time for the NFPA 11, Annex F fire test procedure. These requirements would be essentially unchanged from existing Coast Guard policy and guidance. Consolidating these policies into the CFR would streamline government processes, improve industry accessibility, and strengthen the enforceability of these details for the NFPA 11, Annex F fire test procedure. There are no new costs or cost savings associated with this proposed section because these are already widespread industry practices.

Proposed paragraph (a)(10) would reduce the required number of fire tests to be conducted within the NFPA 11, Annex F test procedure from four tests to two tests. Because standards are already strict, the Coast Guard has determined that passing two tests in a testing series suffices. This would produce quantified cost savings for laboratories because conducting two fewer tests would save time and resources. A reduction in the number of tests would also reduce potential environmental impacts associated with the management of foam concentrate. This would introduce a deregulatory measure and cost savings by eliminating an unnecessary testing protocol for laboratories by reducing the number of tests that are required for system type approval, in line with technological advancements in testing procedures.

Proposed paragraphs (b) through (e) would include additional foam concentrate tests for other hazards that have not been previously available to manufacturers or accepted laboratories. This deregulatory measure would eliminate unnecessary testing restrictions for manufacturers and laboratories and would introduce flexibility of choice for manufacturers and laboratories. We do not expect any new costs or cost savings under these proposed provisions.

Proposed 46 CFR 162.033-11, “Follow-up program, marking, and labeling,” would describe the follow-up program and the marking and labeling of equipment associated with a fixed foam fire-extinguishing system. These requirements would be essentially unchanged from existing Coast Guard policy and guidance. Consolidating these policies into the CFR would streamline government processes, improve industry accessibility, and strengthen the enforceability of the follow up program and marking and labeling requirements. There are no new costs or cost savings associated with this proposed section because these are already widespread industry practices. The marking and labeling requirements do not introduce a new paperwork burden and are already captured in an existing ICR (OMB Collection 1625-0035).

Proposed 46 CFR 162.033-13, “Design, installation, operation, and maintenance (DIOM) manual for fixed foam fire-extinguishing systems,” would list the requirements for a DIOM manual for fixed foam fire-extinguishing systems. These requirements would be essentially unchanged from existing Coast Guard policy and guidance. Consolidating these policies into the CFR would streamline government processes, improve industry accessibility, and strengthen the enforceability of the DIOM manual requirements.

Proposed 46 CFR 162.033-15, “Approval and modification procedures,” would list the approval and modification procedures for fixed foam fire-extinguishing systems. These requirements would be essentially unchanged from the existing Coast Guard policy and guidance. Consolidating these policies into the CFR would streamline government processes, improve industry accessibility, and strengthen the enforceability of the approval and modification procedures.

Table 2 lists the proposed sections of subpart 162.040, the current policy, what the section proposes, whether this would be a change from current Coast Guard policy guidelines and industry standard, and its potential cost impact. Further explanation for each of these sections can be found after the table. None of these provisions would add a new cost burden or result in a cost savings.

Proposed 46 CFR 162.040 would follow standardized format, laid out as follows:

Proposed 46 CFR 162.040-1, “Scope,” would be unchanged from the scope of existing policy (Criteria for USCG Approval of Hose Reel Stations and Criteria for USCG Approval of Hose Reel Stations of Helidecks Without Fueling Facilities, 2013).

Proposed 46 CFR 162.040-3, “Definitions,” would list procedural and contextual definitions currently used in the foam hose reel station industry and the type approval program.

Proposed 46 CFR 162.040-5, “Incorporation by reference,” would incorporate by reference widely accepted national and international standards used by the Coast Guard to approve foam fire-extinguishing systems. Specifically:

1. UL 162, “Standard for Safety: Foam Equipment and Liquid Concentrates,” Eighth Edition, dated February 23, 2018, would be incorporated for its requirements associated with the design, construction, and performance of foam hose reel stations.

2. UL 92, “Standard for Safety: Fire Extinguisher, Booster Hose, and Noncollapsible Standpipe Hose and Hose Assemblies,” Eleventh Edition, dated March 24, 2020, and MIL-H-24580(SH), “Military Specification, Hose Assemblies, Synthetic Rubber, Non-collapsible, Fire Fighting,” dated May 21, 1985, would be incorporated for the specifications for hose used on foam hose reel stations.

3. NFPA 11, “Standard for Low-, Medium-, and High-Expansion Foam, 2024 Edition,” dated December 21, 2023, would be incorporated for its requirements associated with the design, construction, and performance of foam hose reel stations.

4. MSC.1/Circ. 1312/Corr.1, “Revised Guidelines for the Performance and Testing Criteria, and Surveys of Foam Concentrates for Fixed Fire-Extinguishing Systems,” dated 22 November 2011, would be incorporated for its requirements on the periodic sampling of foam liquid concentrates.

Proposed 46 CFR 162.040-7, “General requirements for foam hose reel stations,” would list the design, construction, and performance criteria currently used by the Coast Guard for the approval of foam hose reel stations. Consolidating these policies into the CFR would streamline government processes, improve industry accessibility, and strengthen the enforceability of these requirements.

These requirements would be essentially unchanged from existing Coast Guard policy and guidance. However, paragraph (d) would allow for the possibility of a variable proportioning rate for the foam hose reel station, if approved by the Commandant (CG-ENG-4). This change would allow manufacturers to choose the proportion of foam to water that best suit their needs. The two manufacturers of foam hose reel stations have expressed interest in a variable proportioning rate but currently do not plan to seek approval from the Commandant (CG-ENG-4). This is because any new proportioning rate would differ only slightly from their current proportioning rates, making the change unnecessary at this time. Manufacturers expressed interest in pursuing this option in the future for modified foam hose reel station system designs but stated that they will not for now. As such, this proposed provision would not generate costs or cost savings, and the Coast Guard does not foresee additional costs for approval since manufacturers are unlikely to request changes at this moment. This deregulatory measure would eliminate an unnecessary foam system design restriction for manufacturers and would introduce flexibility of choice for future foam hose reel station designs.

Proposed 46 CFR 162.040-9, “Tests for foam hose reel stations” would list the tests for foam hose reel stations that an independent laboratory must conduct. These tests would be essentially unchanged from existing Coast Guard policy and guidance. Consolidating these policies into the CFR would streamline government processes, improve industry accessibility, and would strengthen their enforceability.

Proposed 46 CFR 162.040-11, “Follow-up program, marking, and labeling,” would describe the follow-up program and the marking and labeling of equipment associated with a foam hose reel station. These requirements would be essentially unchanged from existing Coast Guard policy and guidance. Consolidating these policies into the CFR would streamline government processes, improve industry accessibility, and strengthen the enforceability of these requirements.

Proposed 46 CFR 162.040-13, “Design, installation, operation, and maintenance (DIOM) manual for foam hose reel stations,” would list the requirements for a DIOM manual for foam hose reel stations. These requirements would be essentially unchanged from existing Coast Guard policy and guidance. Consolidating these policies into the CFR would streamline government processes, improve industry accessibility, and strengthen the enforceability of the DIOM manual requirements

Proposed 46 CFR 162.040-15, “Approval and modification procedures,” would list the approval and modification procedures for foam hose reel stations. These requirements would be essentially unchanged from existing Coast Guard policy and guidance. Consolidating these policies into the CFR would streamline government processes, improve industry accessibility, and strengthen the enforceability of the approval and modification procedures.

Material for incorporation by reference appears in proposed §§ 162.033-5 and 162.040-5. The standards are summarized in section VII.L. Technical Standards of this preamble. For information about how to view this material, see the ADDRESSES section of this preamble. Copies of the materials are available from the sources listed in §§ 162.033-5 and 162.040-5. Before publishing a binding rule, we will submit this material to the Director of the Federal Register for approval of the incorporation by reference.

We developed this proposed rule after considering numerous statutes and Executive orders related to rulemaking. A summary of our analyses based on these statutes or Executive orders follows.

Executive Orders 12866 (Regulatory Planning and Review) and 13563 (Improving Regulation and Regulatory Review) direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. Executive Order 14192 (Unleashing Prosperity Through Deregulation) directs agencies to significantly reduce the private expenditure required to comply with Federal regulations and provides that “any new incremental costs associated with new regulations shall, to the extent permitted by law, be offset by the elimination of existing costs associated with at least 10 prior regulations.”

Two additional Executive orders promote the goals of Executive Order 13563: Executive Order 13609 (Promoting International Regulatory Cooperation) and Executive Order 13610 (Identifying and Reducing Regulatory Burdens). Executive Order 13609 targets international regulatory cooperation to reduce, eliminate, or prevent unnecessary differences in regulatory requirements. Executive Order 13610 aims to modernize the regulatory systems and to reduce unjustified regulatory burdens and costs on the public.

The Office of Management and Budget (OMB) has not designated this rule a “significant regulatory action,” under section 3(f) of Executive Order 12866. Accordingly, OMB has not reviewed it.

This proposed rule, if finalized as proposed, is expected to be an Executive Order 14192 deregulatory action.

The proposed rule would reduce the burden on manufacturers of foam firefighting systems and the laboratories that test them by removing unnecessary testing and design protocols and restrictions, promoting flexibility of choice to industry, and generating cost savings for industry. It would also improve government efficiency and increase accessibility by consolidating type approval criteria into the CFR where it is publicly available. A regulatory analysis (RA) follows.

The 2003 Circular A-4  9 encourages agencies to include multiple baselines in regulatory analyses to provide a more comprehensive evaluation of potential impacts, and it mandates that agencies consider at least one baseline that reflects the state of the world without the regulation. This proposed rule consolidates eight prior policy actions. Pursuant to the Circular A-4 guidance, the Coast Guard analyzed the marginal effects of each policy action to isolate the incremental impact of the proposed rule relative to each baseline.

For this proposed rule, the Coast Guard did not conduct a multiple baseline analysis because the policy guidance documents were all published over 10 years ago, and industry already complies with the prospective regulations. Given the age of the policy actions, it is difficult to analyze the state of the world before and after their implementation because of the lack of accurate data. These policy actions are well-established over time, with little or no changes in policy or practice since their publication. In fact, the industry began implementing significant changes around 2003, driven by advancements in technology. This included more rigorous inspections, testing protocols, and enhancements in safety standards. The industry standards illustrated in the policy actions predate the policy actions themselves, which further complicates a marginal effect analysis. Given our previous explanation, because there is 100 percent compliance within the industry with previously issued guidance letters, and because this proposed rule updates and codifies past policy actions, we analyze a single baseline scenario (without guidance) in this RA. As a result, the impacts we estimate in this RA are attributed to the proposed rule.

Table 3 lists each policy/guidance document along with its year of publication or an approximate date. If this rule is finalized as proposed, most of these policy actions would be cancelled and replaced by this rule. NVIC 11-82 and NVIC 02-06 are the only documents that would remain in effect, because they address issues beyond foam firefighting type approval that fall outside the scope of this proposed rule. They would continue to serve as key policy guidance for those matters.

Table 4 lists the proposed new CFR subparts, sections, and paragraphs broken down by criteria changes and economic impact.

The proposed rule would update the type approval criteria for foam fire-extinguishing systems to reflect advancements in technology and introduce deregulatory measures and cost savings for industry. The proposed rule would also consolidate existing foam fire-extinguishing system type approval criteria derived from Coast Guard policy, guidelines, and industry standards.

Table 5 presents the estimated impacts of this proposed rule on industry and the Federal Government. Please see table 1 in section V. Discussion of Proposed Rule of this preamble, for more details.

Based on the publicly available Coast Guard Maritime Information Exchange (CGMIX) Equipment List, 10 this proposed rule would directly impact three manufacturers of foam systems for tanker decks and two manufacturers of foam systems for other hazards. Additionally, this rule's change in 162.040-7(d) would affect five manufacturers that produce foam hose reel stations. Because there is overlap between the manufacturers of the foam systems and the foam hose reel stations, the total number of manufacturers in our affected population is six. Other than the cost savings listed in table 5 for regulatory provisions 162.040-7(h) and 162.033-9(a)(10), we do not expect this proposed rule to produce other costs or cost savings associated with the use of the alternative standard NFPA 11, Annex F, that we would incorporate by reference.

This proposed rule would result in quantified cost savings for four Coast Guard-approved laboratories that test foam systems and foam hose reel stations.

While all manufacturers and laboratories would benefit from increased flexibility and transparency from the proposed requirements, only two of the proposed regulatory provisions would produce quantified cost savings, proposed 162.033-7(h) and 162.033-9(a)(10). See Table 6.

Table 6 outlines the number of manufacturers and laboratories affected by each proposed requirement that would depart from the pre-rule requirements, along with whether the requirement would lead to costs or cost savings.

This is a summary of the Commission's Further Notice of Proposed Rulemaking ( FNPRM ) in CG Docket No. 17-59; and Further Notice of Proposed Rulemaking ( FNPRM ) in CG Docket No. 02-278, document FCC 26-27, adopted on April 30, 2026 and released on May 1, 2026. The full text of this document is available online at https://docs.fcc.gov/public/attachments/FCC-26-27A1.pdf.

Paperwork Reduction Act Analysis: The FNPRM may contain proposed new and revised information collection requirements. The Commission, as part of its continuing effort to reduce paperwork burdens, invites the general public and the Office of Management and Budget (OMB) to comment on the information collection requirements described in this document, as required by the Paperwork Reduction Act of 1995, Public Law 104-13. In addition, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), we seek specific comment on how we might further reduce the information collection burden for small business concerns with fewer than 25 employees.

Providing Accountability Through Transparency Act: Consistent with the Providing Accountability Through Transparency Act, Public Law 118-9, a summary of this document will be available on https://www.fcc.gov/proposed-rulemakings.

Ex Parte Rules: The proceeding the FNPRM initiates shall be treated as a “permit-but-disclose” proceeding in accordance with the Commission's ex parte rules. Persons making ex parte presentations must file a copy of any written presentation or a memorandum summarizing any oral presentation within two business days after the presentation (unless a different deadline applicable to the Sunshine period applies). Persons making oral ex parte presentations are reminded that memoranda summarizing the presentation must (1) list all persons attending or otherwise participating in the meeting at which the ex parte presentation was made, and (2) summarize all data presented and arguments made during the presentation. If the presentation consisted in whole or in part of the presentation of data or arguments already reflected in the presenter's written comments, memoranda or other filings in the proceeding, the presenter may provide citations to such data or arguments in his or her prior comments, memoranda, or other filings (specifying the relevant page and/or paragraph numbers where such data or arguments can be found) in lieu of summarizing them in the memorandum. Documents shown or given to Commission staff during ex parte meetings are deemed to be written ex parte presentations and must be filed consistent with § 1.1206(b) of the Commission's rules. In proceedings governed by § 1.49(f) of the Commission's rules or for which the Commission has made available a method of electronic filing, written ex parte presentations and memoranda summarizing oral ex parte presentations, and all attachments thereto, must, when feasible, be filed through the electronic comment filing system available for that proceeding, and must be filed in their native format ( e.g., .doc, .xml, .ppt, searchable .pdf). Participants in this proceeding should familiarize themselves with the Commission's ex parte rules.

Criminals continue to leverage the anonymity provided by phone calls and texts to defraud Americans and exploit communications networks to further other crimes. To bring illegal callers out of the shadows, we seek comment on making our KYC rules more robust by specifying information originating providers must obtain from customers before they are granted access to its service to make calls, how they should verify that information, and how we can assess enforcement penalties that are proportionate to the harms that unwanted and illegal calls cause. Through this proceeding, the FCC aims to make it more difficult for scammers to originate illegal calls and to enforce against them when they do get onto the network. In addition, we aim to clarify and reduce the regulatory uncertainty of KYC compliance for originating providers. This proceeding complements our broader work attacking illegal calls at all points in their lifecycle, including access to numbers, blocking, and call branding.

We seek comment on requiring originating providers to obtain certain identification information from both new and renewing customers. Specifically, we seek comment on requiring originating providers to, at a minimum, obtain and retain the name, physical address, government issued identification number, and an alternate telephone number of any new and renewing customer before granting access to its services. For high-volume customers, including business and foreign customers, we seek comment on requiring originating providers to also collect the intended use of the service ( e.g., marketing, education, political campaign) and the customer's IP address from which each call will be placed (if applicable). We believe that requiring originating providers to gather this basic identification information will have two benefits. First, it will deter some scammers from getting onto the network. Second, enforcers will be better able to identify the scammers when they do. Gathering such information is the standard to prevent money laundering, and given the misuse of networks by bad actors such as organized criminal groups, we believe it provides a good model for our work.

We seek comment on our views. Can enhanced KYC prevent misuses of U.S. communications networks and numbering resources? Would requiring the collection of this information help cut down on illegal calls? Is the information we describe above sufficient to enable originating providers to identify malicious actors before they originate illegal calls? Is any of this information not needed to verify the identity of new and renewing customers? What privacy concerns may arise from such a collection of personally identifiable information (PII) and how can we mitigate them? Should we require more information, such as date of birth, like the Treasury CIP rule? Is such information useful in identifying malicious actors before they make illegal calls and locating them after they make illegal calls? We seek comment on whether AI and other automated technologies are being used by originating providers for KYC compliance purposes to detect bad actors and prevent illegal calls? What types of information do automated tools gather and validate for KYC compliance purposes? If so, how does the effectiveness of these technologies compare to more traditional approaches that involve acquiring and verifying identification documents? How do we ensure that any enhanced KYC requirements do not inhibit the development and deployment of AI and automated KYC systems? Are there specific networking protocols or layers that we should seek targeted information about given that IP addresses can change, VPNs may be used and there are a variety of ways to tunnel and port IP-based traffic? How can we minimize burdens on consumers so they are not unduly hindered in gaining access to voice services? Do enhanced KYC requirements impose burdens on smaller providers? If so, are there ways to minimize such burdens?

How should we define “physical address” for these purposes? Should we exclude the use of virtual addresses, shared office locations without a dedicated suite or floor, P.O. boxes, mail forwarding services, and hosted servers because such addresses are inadequate to confirm the identity of a customer and often used by bad actors to conceal its identity? We also seek comment on whether foreign customers use domestic U.S. providers to originate large volumes of calls. Are there ways in which we can address any KYC issues relating to foreign-based callers?

We seek comment on how we should define “new” and “renewing” customers for these purposes. Should new customers be only those new to the originating provider? Or are those switching to different plans offered by the current provider considered “new” for purposes of the KYC requirement? Should “renewing” customers be only those who are merely continuing an existing plan for a new contract period? Should contracts that contain automatic renewal clauses be considered a renewal in this context? How often do customers renew contracts for voice services? If infrequently, should we consider as an alternative to renewing customers requiring re-verification of existing customer identity information on a periodic basis such as after a specified number of years?

Risk-Based Differences. Should we require originating providers to collect more information about customers that are more likely to make illegal calls, e.g., those subscribing to high volume services or those that may be difficult to locate based on being foreign-based, or other factors? For example, should we consider a tiered approach where KYC requirements become more stringent for high-volume callers, callers using specific types of calling equipment associated with robocalling, or callers engaged in certain traffic patterns? If so, what additional information should we require originating providers to collect from higher-risk customers? How should the Commission establish a threshold for what constitutes a “high-risk” and/or “high volume” caller? For example, the Lingo Consent Decree required the collection of an Employer Identification Number (EIN) or Business Registration Number for business accounts. Should we impose similar requirements for all new and renewing high-volume customers? To what extent would this assist in confirming the identity of the high-volume customers seeking to obtain access to the network? Is the distinction between a “high volume” and “low volume” customer sufficiently clear for KYC purposes or are there industry standards that should guide any such distinction, e.g., “high volume” being more than an individual caller or small business would typically make? Should all business customers accounts be subject to the same KYC requirements regardless of their call volume? Beyond call volume, are there other risk based call behaviors that should trigger enhanced KYC requirements for new or renewing customers? Would a risk-tiered approach be useful for smaller voice providers that may not typically have customers that generate high volume calls? Should we require originating providers to collect more information from customers that utilize lead generators or dialing platforms that may lack strong KYC requirements? Should we require originating providers to consult lists of terrorists and terrorist organizations and criminal persons maintained by law enforcement entities?

Differences Based on Prepaid and Postpaid Service. We seek comment on whether customer information requirements should vary depending upon whether the customer is seeking a prepaid or postpaid service plan. Are there differences in current industry KYC information collections based upon whether the customer is seeking prepaid or postpaid plans or whether the customer purchases a prepaid plan at a retail store or online? Are there KYC measures we can impose for prepaid service purchased through third-party vendors such as prepaid SIM cards? What, if any, customer information do wireless providers obtain from customers who purchase prepaid SIM cards? What percentage of prepaid plans are purchased in person at retail stores? What steps do providers currently take to validate KYC for prepaid services purchased at third-party retailers? Do prepaid customers have the same ability to make high volumes of illegal calls as postpaid customers, or are there inherent limitations on prepaid plans? To what extent are bad actors using prepaid service to make illegal calls? Are current KYC standards associated with prepaid services being exploited by criminals committing other types of crime, such as human trafficking?

For example, fraudulent Short Messaging Service (SMS) text messages can originate from Subscriber Identity Module (SIM) boxes. What steps have Mobile Network Operators (MNO) and Mobile Virtual Network Operators (MVNO) taken to address bulk purchases of SIM cards or bulk account activation? Have these measures proven effective at reducing the number of illegal calls being made using SIM boxes? If not, are there ways we should address this issue in the KYC framework that would not otherwise hinder access to affordable phone service to millions of Americans?

How do the KYC requirements discussed herein compare to existing industry practices and guidelines designed to satisfy the KYC requirement? To the extent these requirements create new burdens on originating providers, how can we minimize those burdens, including those on smaller originating providers such as non-nationwide service providers, while still promoting the objective to identify customers that pose the greatest risks to make illegal calls and to locate them if they do make such calls? For example, companies in the financial services industry need not directly collect KYC information in certain circumstances when they can obtain it from alternative sources such as credit reports. Should we adopt a similar exemption in this context? If so, which alternative sources should qualify for this exemption? Should we use any existing industry best practices to set baseline KYC compliance standards, including for smaller providers? We also seek comment on whether such KYC requirements would provide sufficient flexibility to account for different services and customers with varying risk profiles in a manner that allows providers to continue to adapt to the evolving tactics used by bad actors to gain access to voice services.

We also seek comment on how we can ensure any new KYC requirements complement any Call Branding or Caller Name requirements we may adopt. For example, how can we ensure we do not duplicate burdens on originating providers? Is there a direct connection between the customer identity information originating providers would gather if we adopt enhanced KYC requirements and the caller identity information terminating providers would deliver to handsets? Are there other considerations raised in the Call Branding FNPRM proceeding that should be coordinated with any enhanced KYC requirements to better promote the objectives of both proceedings? We seek comment on these and any other issues relevant to this matter.

An effective KYC regime must confirm the accuracy of the information customers provide. We seek comment on requiring originating providers to take specific measures to verify, re-verify, and retain collected customer identification information. Bad actors may submit fake or stolen information to conceal their identity to gain access to the network and avoid accountability for making illegal calls. Originating providers that conduct a thorough verification of their customers' information can discover the use of such fake information before allowing bad actors to originate calls and stop illegal calls before they occur. By better knowing their customers, providers can also help facilitate the Commission and other law enforcement agency efforts to locate such callers by ensuring that the information provided is accurate. Verification measures also ensure originating providers' compliance with the obligation to exercise due diligence to ensure that its network is not used to originate illegal traffic. Periodic review or ongoing re-verification of KYC information is essential to ensure that bad actors have not gained access to the network and to enable the Commission to hold them accountable.

Verification. We seek comment on requiring originating providers to obtain supporting records to verify the customer's identity, such as copies of government-issued identification. For customers seeking access to services that enable origination of high volumes of calls ( e.g., a number of calls above what an individual caller would make using a personal account), we seek comment on requiring verification of customer information using supporting records such as corporate formation records, proof of good standing such as a state-issued certification, confirmation that the telephone number provided is the customer's current active telephone number, third-party records of a customer's physical address, and verification of commercial presence ( e.g., website, social media, store front) when applicable before being granted access to the network. We anticipate that most high-volume callers will be businesses or similar entities that have such supporting records. To the extent, however, that they are individuals seeking access to high-volume service, what additional verification measures should we require?

Is this list comprehensive? Should we require more or fewer verification measures; should any additional steps vary depending on whether the customer is deemed higher or lower risk? And should we require that originating providers complete all steps successfully before allowing the customer to use its network? If the customer is renewing, what period of time should the provider have to complete its verification before suspending access to the network? What existing tools and practices do providers use to verify customer information? Are there commercially available resources that originating providers can use to accurately verify the identity and location of a customer? If so, should we find use of these resources sufficient to satisfy any enhanced KYC verification requirement? Are there other industries and/or other countries with successful KYC verification requirements? If so, are their models applicable to U.S. communications services? What privacy issues related to the collection and retention of such information should we consider?

We believe that there are red flags that should raise concerns for closer verification such as providing a registered agent or virtual office as a physical address; registering a corporate address using a residential address or random commercial location that is unaffiliated with the customer; lacking a commercial presence or operating a suspicious website ( e.g., a newly created website); using a suspicious email address ( e.g., a recently created email address, template website with little information unique to the company); not being registered in the state in which it purports to be located or incorporated; or paying for service in non-traceable ways such as the use of cryptocurrency. We tentatively conclude that these red flags should alert an originating provider as to a customer's potential intention to use its service to make illegal calls and seek comment on this conclusion. Are there additional red flags that raise concerns with a customer's access to the network that should result in originating providers exercising more stringent verification measures?

Risk-Based Re-verification. Should we require originating providers to re-verify KYC customer information in response to changes in traffic patterns or other red flags that may suggest illegal calls? If so, what types of changes in traffic patterns? We expect that originating providers will monitor traffic on their networks to determine if there are customer information inconsistencies such as a domestic U.S. company transmitting traffic from a foreign-based IP address or dormant accounts suddenly reappearing and sending large volumes of calls. In such instances, we seek comment on whether re-verification methods should include contacting the customer directly; independently verifying the customer's identity through the comparison of information provided by the customer with information obtained from a consumer reporting agency, public database, or other source; checking references with financial institutions; or obtaining a financial statement. We seek comment on what resources, databases, or third-party tools originating providers could use to verify customer identity. Are there privacy, cost, or operational concerns that we should consider when determining which verification resources are appropriate?

Alternatively, should we require originating providers to periodically re-verify customer information on an ongoing basis, such as annually? How would the compliance burdens of this approach including for smaller providers compare to a re-verification process triggered only by a red flag or unusual activity on the customer's account? Should any re-verification requirements be identical to the original verification measures when initiating service or, in the absence of any reasonable basis for concern or red flags, be less stringent? We seek comment on the current practices and guidelines that originating providers take in this context including how often and under what circumstances they re-verify customer information to ensure that it remains accurate and what actions they take to ensure that their services are not being used to originate illegal traffic.

Retention. We seek comment on requiring originating providers to retain KYC information and supporting records for the entirety of any potential statute of limitation period relating to misuse of their services to make illegal calls. In the case of spoofing or intentional violations of section 227(b) of the Communications Act, that statute of limitations period is four years. As a result, originating providers would be required to retain KYC customer information and supporting records for four years following termination of the customer relationship and we seek comment on this approach. We seek comment on industry customer information retention periods including whether this approach imposes any new burdens on smaller providers by differing from those practices. What steps does the industry take to protect such information from unauthorized access, and would those steps offer enough protection to an expanded collection and retention of PII or would heightened security be necessary? Should we consider an alternative retention timeframe?

We propose to codify a base forfeiture amount for violations of § 64.1200(n)(4) on a per call basis to best correlate penalties to the volume of illegal calls made, and thus the harm caused by any one caller. Specifically, we propose to codify a $2,500 per call base forfeiture amount. Alternative approaches, such as assessing fines on a “per customer” basis, would result in a single base forfeiture regardless of the number of illegal calls made by the customer. The Commission has confirmed that the responsibility imposed by § 64.1200(n)(4) for originating providers to know their customers is a critical aspect of protecting Americans from illegal and harmful calls. In that regard, we emphasize that § 64.1200(n)(4) requires that originating providers take “affirmative, effective measures to prevent new and renewing customers from using its network to originate illegal calls,” which includes both “knowing its customers,” and “exercising due diligence in ensuring that its services are not used to originate illegal traffic.” Originating providers that fail to satisfy either obligation will be deemed in violation of the rule. We believe that our proposed approach would better encourage compliance with the rule. We seek comment on this and any other issues relevant to this proposal including whether and how to expedite the provision of customer information to the Commission or law enforcement upon any notification to the originating provider that one of its customers is under investigation for using the provider's network to make illegal calls.

We seek comment on whether the Commission should, as an alternative to adopting specific KYC requirements, issue baseline KYC guidance or expectations that act as a regulatory safe harbor. Specifically, should we deem compliance with any enhanced KYC obligations or baseline KYC expectations a safe harbor from any enforcement action against the originating provider? Should using an accredited third party to verify customer identity trigger a safe harbor? Should we establish a safe harbor for originating providers that employ effective AI or automated systems that satisfy KYC objectives by identifying bad actors and preventing illegal calls? Would such a safe harbor approach sufficiently incent better KYC practices while giving originating providers flexibility to develop innovative KYC protections and react to evolving tactics used by bad actors to gain access to voice networks? Does such an approach promote innovation and competition among originating providers leading to better KYC compliance and fraud prevention across the ecosystem of voice calling customers?

We seek comment on other enforcement measures we should consider to deter illegal calls. For example, are our existing rules sufficient to ensure that originating providers provide assurance of their compliance with KYC rules? If not, should we require a specific certification regarding KYC compliance as part of the Robocall Mitigation Database (RMD) filings? It might also include requiring originating providers to obtain independent verification of their compliance, e.g., via an independent auditor using generally accepted standards for providing such assurance. Should we consider broadening our downstream provider blocking requirements so that any provider downstream of an originating provider that fails to comply with our KYC requirements must block that originating provider's traffic? Would that be technically feasible, e.g., can all downstream providers (not just the immediate downstream provider) identify the originating provider?

We seek comment on whether enhanced KYC requirements can prevent or deter criminal use of communication networks that do not involve illegal calls. Enhanced KYC information can assist law enforcement to more easily identify callers that use the network to perpetuate crimes by ensuring that voice providers have accurate and complete customer information. The KYC information gathered and verified would help ensure that law enforcement gets accurate information in response to subpoenas when investigating crimes. For example, can enhanced KYC rules assist law enforcement in investigating organized criminal groups that use the network to facilitate illegal activities? Can they be used to deter or detect trafficking operations that use communication networks to buy and sell illicit goods? Would enhanced KYC measures for originating providers also address abuse in text messaging networks? Would such rules assist law enforcement in the investigation of fraud, espionage, or influence operations that undermine national security? Are there enhancements we could make that would better assist law enforcement investigations?

We seek comment on whether to make any rules we adopt pursuant to this FNPRM applicable primarily only to new and renewing customers that originating providers acquire after the effective date of any new rules and to any customers that renew service with such providers after the effective date. We also seek comment on whether any new KYC rules should take effect six months after OMB approval of any applicable Paperwork Reduction Act requirements. Would extending the effective date for smaller providers further minimize compliance burdens?

We seek comment on whether we should adopt a different implementation timeline for KYC requirements that would apply to existing customers that use high-volume services if we were to adopt heightened KYC requirements for such customers seeking to obtain such services. Or should existing customers that use high-volume services have to undergo heightened KYC measures only at service renewal? How should we define renewal for this purpose?

We seek comment on these issues and whether they best balance the need for enhanced KYC requirements with the legitimate business requirements of providers, particularly small and rural providers.

Consistent with our approach in the Fourth Call Blocking Order, we believe sections 201(b), 227(e), and 251(e) of the Communications Act of 1934, as amended, give us authority to implement affirmative measures requiring originating providers to know their customers and exercise due diligence in ensuring that their services are not used to originate illegal calls. Section 201(b) grants us broad authority to adopt rules governing just and reasonable practices of common carriers. Our section 251(e) numbering authority provides separate authority to prevent the fraudulent abuse of North American Numbering Plan (NANP) resources; this particularly applies where callers spoof caller ID for fraudulent purposes and therefore exploit numbering resources, regardless of whether the originating voice service provider that places the calls onto the U.S. network is a common carrier.

Similarly, the Truth in Caller ID Act grants us authority to prescribe rules to make unlawful the spoofing of caller ID information with the intent to defraud, cause harm, or wrongfully obtain something of value. Taken together, section 251(e) and the Truth in Caller ID Act grant us authority to prescribe rules to prevent the unlawful spoofing of caller ID and abuse of NANP resources by callers, and the proposed amendments to our existing KYC requirements would take a further positive step toward stopping such illegal calling. Consistent with our existing § 64.1200(n)(4) rule, we find that it is essential that any rules apply to all originating providers including VoIP providers. Absent broad application, VoIP would remain a potential safe haven for malicious actors to make illegal calls to consumers. We seek comment on these views.

National Security. We believe that the Commission's national security authority is another basis for the possible rules we discuss above. Illegal calls are more than an annoyance—bad actors can use them for denial-of-service attacks and also surveil and target government officials and sensitive infrastructure. We thus believe protecting networks with enhanced KYC requirements advances our responsibility to “make available, so far as possible, . . . a rapid, efficient, Nation-wide and world-wide wire and radio communication service . . . for the purpose of the national defense.” With respect to international telecommunications services, do we have authority under Section 303(r) to adopt rules implementing the General Agreement on Trade in Services (GATS), which allows members, subject to certain conditions, to enforce measures necessary to secure compliance with laws or regulations relating to “the protection of the privacy of individuals in relation to the processing and dissemination of personal data and the protection of confidentiality of individual records and accounts” and “the prevention of deceptive and fraudulent practices”?

We seek comment on these possible bases of authority along with any others, including how our rights under other trade agreements, including free trade agreements, might serve as authority for any changes to our KYC requirements as discussed above.

The Commission receives more complaints about illegal calls than any other issue. Illegal calls can annoy, defraud, and erode confidence in the telecommunications network while costing consumers billions of dollars in fraud and wasted time. As noted above, the most effective way to prevent illegal calls from reaching American consumers is by ensuring they never enter the network. Originating providers are best positioned to stop illegal calls before they enter the network by screening new or renewing customers. When an originating provider fails to meet its obligations to properly scrutinize its customers before they commence using the provider's services to originate calls, it creates a risk that malicious actors will gain access to those services to make illegal calls and opens the door for foreign actors to exploit U.S. networks for fraud, espionage, or influence operations that undermine national security. In addition, a lack of accurate and complete customer information hinders the Commission's ability to identify and locate parties responsible for making illegal calls.

In the Fourth Call Blocking Order, the Commission required all originating providers to implement KYC obligations and exercise due diligence to ensure their services are not used to originate unlawful and illegal calls. In this FNPRM, we seek comment on specific actions that originating providers might take to comply with the existing KYC requirements. We anticipate that many originating providers already take KYC compliance measures and therefore tentatively conclude that any incremental compliance costs will be minimal. We expect that any changes to the rules will eliminate confusion and provide clear guidance to originating providers where ambiguity exists. As a result, any rule changes are likely to reduce regulatory uncertainty. We seek comment on the costs and benefits of changes to our rules, including the specific economic impact on small business entities and ways to minimize those impacts.

We believe that any potential rule changes discussed above will help consumers avoid illegal calls including scams, fraud, and otherwise unlawful calls and better protect U.S. telecommunications networks from foreign actors. In addition, we propose to codify the forfeiture amount for KYC violations on a per call basis, which we believe will create incentives for compliance and further reduce the origination of unlawful and illegal calls. We seek comment on whether there are additional costs and burdens on originating providers that we have not identified including ways to minimize burdens for smaller voice service providers.

As. required by the Regulatory Flexibility Act of 1980, as amended (RFA), the Federal Communications Commission (Commission) has prepared this Initial Regulatory Flexibility Analysis (IRFA) of the policies and rules proposed in the FNPRM assessing the possible significant economic impact on a substantial number of small entities. The Commission requests written public comments on this IRFA. Comments must be identified as responses to the IRFA and must be filed by the deadlines for comments specified on the first page of the FNPRM. The Commission will send a copy of the FNPRM including this IRFA, to the Chief Counsel for the SBA Office of Advocacy. In addition, the FNPRM and IRFA (or summaries thereof) will be published in the Federal Register .

The Commission has prioritized combatting illegal calls as a top consumer protection. The Commission's goal is to stop illegal calls before they enter the network, thus requiring originating providers to block them, which would give consumers more information and ability to decide which calls they wish to receive. The Commission initiates this proceeding to further enhance its existing “Know-Your-Customer” (KYC) requirements to mandate better compliance and enforcement of the rule. The Commission seeks comment on specific actions originating providers must take to guard against the origination of illegal calls. In this FNPRM, the Commission notes that it receives more complaints about unwanted calls than any other issue. Unwanted and often illegal calls can annoy and defraud the consumer as well as lead to eroding confidence in the telecommunications network while costing consumers billions of dollars in fraud, wasted time, and nuisance.

The most effective way to prevent illegal calls from reaching American consumers is by ensuring that those calls never originate on or enter the U.S. network. The Commission seeks comment on ways to keep bad actors from gaining access to the network. The Commission believes that originating providers are best positioned to stop illegal calls before they enter the network by screening new or renewing customers. When an originating provider fails to meet its obligations to properly scrutinize its customers before they commence using the provider's services to originate calls, it creates a risk that malicious actors will gain access to those services to make illegal calls and opens the door for foreign actors to exploit U.S. networks for fraud, espionage, or influence operations that undermine national security. In addition, the Commission's ability to identify and locate the parties that are responsible for making illegal calls is hindered when accurate and complete customer information is unavailable from the voice service provider.

In this FNPRM, we: (1) seek comment on specific customer identification requirements for new and renewing customers; (2) seek comment on requirements for originating providers to verify, retain, and periodically re-verify customer information; (3) seek comment on whether any enhanced KYC requirements should include risk-based security controls to require higher levels of scrutiny for certain customers including foreign customers and high-volume customers based on the risks posed to make illegal calls; and (4) propose that the Commission will assess penalties for violations of the KYC rule on a per call basis.

The proposed action is authorized pursuant to sections 1-4, 201(b), 227(e), and 251(e) of the Communications Act of 1934, as amended, and 47 U.S.C. 151-154, 201(b), 227(e), and 251(e).

The RFA directs agencies to provide a description of and, where feasible, an estimate of the number of small entities that may be affected by the proposed rules, if adopted. The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act (SBA). A “small business concern” is one which: (1) is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the SBA. The SBA establishes small business size standards that agencies are required to use when promulgating regulations relating to small businesses; agencies may establish alternative size standards for use in such programs, but must consult and obtain approval from SBA before doing so.

Our actions, over time, may affect small entities that are not easily categorized at present. We therefore describe three broad groups of small entities that could be directly affected by our actions. In general, a small business is an independent business having fewer than 500 employees. These types of small businesses represent 99.9% of all businesses in the United States, which translates to 34.75 million businesses. Next, “small organizations” are not-for-profit enterprises that are independently owned and operated and not dominant their field. While we do not have data regarding the number of non-profits that meet that criteria, over 99 percent of nonprofits have fewer than 500 employees. Finally, “small governmental jurisdictions” are defined as cities, counties, towns, townships, villages, school districts, or special districts with populations of less than fifty thousand. Based on the 2022 U.S. Census of Governments data, we estimate that at least 48,724 out of 90,835 local government jurisdictions have a population of less than 50,000.

The rules proposed in the FNPRM will apply to small entities in the industries identified in the chart below by their six-digit North American Industry Classification System (NAICS) codes and corresponding SBA size standard. Based on currently available U.S. Census data regarding the estimated number of small firms in each identified industry, we conclude that the proposed rules will impact a substantial number of small entities. Where available, we also provide additional information regarding the number of potentially affected entities in the above identified industries.

The RFA directs agencies to describe the economic impact of proposed rules on small entities, as well as projected reporting, recordkeeping and other compliance requirements, including an estimate of the classes of small entities which will be subject to the requirements and the type of professional skills necessary for preparation of the report or record.

The Commission seeks comment on specific actions originating providers should take to guard against unwanted and illegal calls. The FNPRM seeks comment on establishing new information collection, reporting, recordkeeping, or compliance requirements for small entities. Specifically, it seeks comment on requiring originating providers to obtain specific customer identification information from new and renewing customers. This may require originating providers to enhance their current practices for obtaining such customer information before granting access to their services.

The FNPRM also seeks comment on specific requirements for originating providers to verify, retain, and re-verify customer information. This may require affected small entities to establish or enhance existing verification procedures, maintain records of verification activities, and implement systems to ensure customer identification information is secure, accurate, and complete.

The FNPRM also seeks comment on whether KYC requirements should include risk-based security controls depending on an assessment of the risk that the customer poses to make large numbers of illegal calls. For example, greater levels of review for foreign and high-volume customers than for low-volume customers. To comply with this requirement, affected small entities may need to establish verification procedures when a customer indicates an intent to make a high volume of calls or is located in a country other than the United States.

Finally, the Commission invites comment on the costs and burdens of enhanced KYC requirements on small entity voice service providers. The Commission expects that information received in comments, including cost and benefit analyses where requested, will help the Commission identify and evaluate relevant compliance matters for small entities that may result if the proposals and associated requirements discussed in the FNPRM are ultimately adopted.

The RFA directs agencies to provide a description of any significant alternatives to the proposed rules that would accomplish the stated objectives of applicable statutes, and minimize any significant economic impact on small entities. The discussion is required to include alternatives such as: “(1) the establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance and reporting requirements under the rule for such small entities; (3) the use of performance rather than design standards; and (4) an exemption from coverage of the rule, or any part thereof, for such small entities.”

In the FNPRM, the Commission seeks comment on several approaches that may minimize impacts on small entities. For example, we seek comment on whether originating providers should be exempted from acquiring direct KYC information when such information can be obtained from credible alternative sources such as a credit report. We also seek comment on current industry practices for obtaining, verifying, and retaining customer information including ways that we might tailor any enhanced KYC requirements to conform to these practices in a way that minimizes any new burdens. We seek comment on whether enhanced KYC requirements can be designed to complement any Call Branding FNPRM proposal to require originating providers that transmit caller identity information to employ reasonable measures to verify the accuracy of the information transmitted including mandating the collection and verification of specific customer information. In particular, we seek comment on whether there are ways in which enhanced KYC requirements can be coordinated to minimize burdens and promote industry compliance. Finally, we seek comment on whether any rules adopted pursuant to this FNPRM apply only to customers originating providers acquire after the effective date of any new rules and to any customers that renew service with the provider after the effective date. We also seek comment on whether any such rules should not take effect until six months after OMB approval of any applicable Paperwork Reduction Act requirement to provide affected entities with an opportunity to take any measures necessary to ensure compliance with these requirements.

The Commission expects to more fully consider the economic impact and alternatives for small entities following review of comments filed in response to the FNPRM and this IRFA. The Commission's evaluation of this information will shape the final alternatives it considers, the final conclusions it reaches, and any final actions it ultimately takes in this proceeding to minimize any significant economic impact that may occur on small entities.

None.

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

NMFS manages a number of fisheries in Federal waters of the U.S. southeast region. The Coastal Migratory Pelagic (CMP) fishery includes the Gulf and Atlantic region, and fish such as king mackerel. The Gulf Fishery Management Council (Gulf Council), South Atlantic Fishery Management Council (South Atlantic Council), and NMFS prepared the FMP for the Coastal Migratory Pelagic Resources of the Gulf and Atlantic Region (CMP FMP). The South Atlantic Council and NMFS prepared the FMP for Dolphin and Wahoo Fishery of the Atlantic (Dolphin and Wahoo FMP) and the FMP for the Snapper-Grouper Fishery of the South Atlantic Region (Snapper-Grouper FMP) in the South Atlantic. The Gulf Council and NMFS prepared the FMP for the Reef Fish Resources of the Gulf (Reef Fish FMP). The FMPs were approved by the Secretary of Commerce (Secretary) and are implemented by NMFS through regulations at 50 CFR part 622 under the authority of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act, 16 U.S.C. 1801 et seq. ). This action is proposed under the authority of section 303(a)(5) of the Magnuson-Stevens Act (16 U.S.C. 1853(a)(5)), which requires that FMPs specify the data required to be submitted to the Secretary, and is consistent with National Standard 7 of the Magnuson-Stevens Act (16 U.S.C. 1851(a)(7)), which requires that conservation and management measures minimize costs and avoid unnecessary duplication where practicable.

The Magnuson-Stevens Act requires that NMFS and regional fishery management councils prevent overfishing and continually achieve the optimum yield from federally managed fish stocks. These mandates are intended to ensure that fishery resources are managed for the greatest overall benefit to the Nation, particularly with respect to providing food production and recreational opportunities, and protecting marine ecosystems. Congress recognized that the collection of reliable data is essential to the effective conservation, management, and scientific understanding of the Nation's fishery resources (16 U.S.C. 1801(a)(7)).

On November 20, 2025, NMFS published a notification in the Federal Register of the availability of the Commercial Electronic Logbook Amendments for public comment (90 FR 52349). NMFS received 20 submissions from the public, commercial fishermen, and fishing industry organizations. The majority of the comments supported the action. NMFS will respond to all comments received during the comment periods for the Commercial Electronic Logbook Amendments and for this proposed rule if NMFS publishes a final rule. On February 13, 2026, the Secretary approved the Commercial Electronic Logbook Amendments under section 304(a)(3) of the Magnuson-Stevens Act.

The Commercial Electronic Logbook Amendments, if implemented, amend four separate FMPs to require the owner or operator of a vessel issued a commercial permit to submit the required logbook in an electronic format rather than using the current paper forms. These FMP amendments are: (1) Amendment 35 to the CMP FMP; (2) Amendment 4 to the Dolphin and Wahoo FMP; (3) Amendment 54 to the Snapper-Grouper FMP; and (4) Amendment 57 to the Reef Fish FMP. The change to the required reporting applies to any commercial permit for the following species: (1) CMP species in the Gulf and Atlantic; (2) Atlantic dolphinfish (dolphin) and wahoo; (3) South Atlantic snapper-grouper species; and (4) Gulf reef fish species.

The Commercial Electronic Logbook Amendments detail the evolution of the data collections through the commercial coastal fisheries logbook program (CFLP) and other commercial reporting requirements. All of these data collections provide essential trip information required to assess the status of fish stocks and monitor harvest, which are necessary to comply with the Magnuson-Stevens Act. In addition, economic and discard data are collected to address other provisions of the Magnuson-Stevens Act and other applicable law, such as the need to provide analyses of net economic effects and bycatch. The following discussion summarizes the CFLP and related data collections.

NMFS began the CFLP in 1990 for fishermen issued a Federal commercial permit for the Gulf reef fish fishery. Over time, NMFS has expanded the CFLP to include commercial harvest in the South Atlantic snapper-grouper fishery (1992), the CMP fishery in the Gulf and Atlantic (1998), and the Atlantic dolphin and wahoo fishery (2004). Fishermen that target shark species under the FMP for highly migratory species (HMS) (as developed by NMFS' Atlantic HMS Management Division), which include various tunas, billfishes, and sharks, are also included in the CFLP. The CFLP collects basic fishing effort and catch related data, including species and weights of landed fish, fishing location and depth of water, and the type of gear used to fish.

Since the initial implementation of the CFLP, NMFS has made several changes to forms and survey design to improve data collection. For example, the trip expense section of the form has been modified several times since 2001 and several updates were made to the “gear type used” data field to better clarify how fish were harvested. Also, the NMFS Southeast Fisheries Science Center (SEFSC) created a separate no-fishing form to better distinguish between non-fishing and non-reporting activity.

Currently, NMFS' SEFSC mails the logbook to the owners of federally permitted vessels with the applicable commercial permit (permit holders) every December. Each year, NMFS selects 20 percent of permit holders to complete economic questions in the “trip expense” section of the logbook and 20 percent of permit holders are selected to complete a supplemental discard survey. The mailing consists of a carbon paper logbook of approximately 100 pages containing 3 sections, including instructions, fishing trip reporting forms, and no-fishing report forms, along with postage paid return envelopes. The owner or operator of the federally permitted vessel must report the fishing activity of each trip within 7 days after finishing a trip or after a month without any fishing activity and mail the form to SEFSC. This recordkeeping and reporting requirement has been in place since at least 2004 for the affected Federal fisheries. NMFS recommends that fishermen keep the carbon copy of the CFLP form for their personal records.

Fishermen affected by this proposed rule may also possess other Federal commercial fishing permits issued by NMFS that have additional or different reporting requirements for commercial fishing trips. Other permits include those issued by the NMFS Greater Atlantic Regional Fisheries Office (GARFO) and the Atlantic HMS Management Division. A vessel owner or operator with a commercial permit for Gulf reef fish or South Atlantic snapper-grouper who participates in the individual fishing quota (IFQ) programs in the Gulf or the wreckfish individual transferrable quota (ITQ) program in the South Atlantic has reporting requirements specific to those programs. Each permit holder is responsible for ensuring compliance with the permit requirements of all relevant programs.

NMFS manages the commercial harvest of 14 Gulf reef fish species though 2 IFQ programs under the Reef Fish FMP. The IFQ programs use a dedicated electronic reporting system to track allocation of catch limits to fishermen and commercial landings in real-time. NMFS manages wreckfish under the Snapper-Grouper FMP through an ITQ program. The ITQ program uses paper methods for documentation of share certificates, allocation coupons, wreckfish vessel logbooks, and wreckfish dealer logbooks. NMFS is developing a separate proposed rule to establish an electronic monitoring and tracking system for the ITQ program. These IFQ and ITQ programs allocate a portion of an annual catch level to individual fishermen that can be harvested throughout the fishing year. The IFQ and ITQ reporting systems are not logbook programs and operate independently of the CFLP. Reporting requirements under the IFQ and ITQ programs would remain unchanged by the proposed modifications to the CFLP. Owners and operators of vessels participating in the IFQ and ITQ programs would continue to report to both the applicable IFQ and ITQ system, and the CFLP.

All commercial vessels with Federal permits issued by NMFS GARFO for species managed by the Mid-Atlantic or New England Fishery Management Councils are required to submit vessel trip reports (VTRs) electronically as eVTRs generally within 48 hours of the end of a commercial fishing trip (50 CFR 648.7). Permit holders that report logbook information to GARFO must use software approved by that office to submit an eVTR. Those fishermen operating vessels with commercial permits issued by both GARFO and the Southeast Regional Office may need to continue to submit multiple reports per commercial fishing trip to remain compliant with the reporting requirements of each permit. NMFS is evaluating options to streamline reporting requirements for various East Coast and Gulf fisheries to reduce or eliminate reporting redundancy.

NMFS also uses the CFLP to collect HMS landings and effort related data from vessel owners primarily with commercial, limited access shark fishing permits using bottom longline, gillnet, or vertical line (including bandit) gear. A vessel owner with an HMS fishing permit and reporting through the CFLP must record the required logbook information for each day of fishing within 48 hours of completion or before offloading fish from the vessel, whichever is sooner. The completed logbook forms must be mailed in the provided postage paid envelopes and postmarked within 7 days of offloading all HMS. NMFS' HMS Management Division published a proposed rule in September 2024 that would change requirements for fishermen with HMS permits reporting through the CFLP and other methods. The proposed rule would switch to an electronic reporting method and adjust the timing requirement (89 FR 72796, September 6, 2024). As stated in the proposed rule, electronic logbook reporting is a step towards streamlining HMS reporting for commercial, for-hire, and private recreational fisheries consistent with the one stop reporting initiative to expand capabilities for the submission of a single electronic report to satisfy overlapping reporting requirements of vessels holding permits in multiple regional fisheries. As of April 2026, the HMS Management Division has not published a final rule.

If the Commercial Electronic Logbook Amendments are implemented by NMFS through this proposed rule, the format of required reporting in the CFLP would change from a paper logbook to an electronic reporting format and make limited changes to the data that fishermen need to report. The deadline to submit an electronic report after a fishing trip would not change from current requirements. The selection process for the “trip expense” and discard portions of the logbook would also remain the same.

NMFS expects the Commercial Electronic Logbook Amendments to improve the accuracy and efficiency of logbook data collected from federally permitted commercial fishermen that report to the CFLP. Moving to an electronic platform is expected to increase convenience and ease of reporting for commercial fishermen while increasing the accuracy and timeliness of commercial data for use by fishery managers. The collected data would be available sooner to fishery managers once submitted through the electronic platform compared to the same data collected on the paper forms. Paper logbooks are sometimes difficult to interpret by analysts, and the analysts often need to contact the submitter for clarification or correction with several days or weeks elapsed from when fishing occurred. This need would be reduced if the logbook were electronically submitted, because logbook validations built into the electronic software could prevent some errors, such as a trip start time being recorded as occurring after a trip end time. In addition, fishermen would not need to mail the paper reports, which is less convenient than using the electronic format. Therefore, NMFS expects the proposed change to electronic reporting to increase data accuracy and decrease the time delay of when those data are available for use by fishery managers.

This proposed rule would require that commercial fishermen submit fishing reports on electronic software approved by NMFS. A vessel owner or operator would submit a completed fishing report electronically no later than 7 days after the end of each fishing trip, which is the same timeframe required currently for submission of fishing reports on paper forms. If no fishing occurred during a calendar month, an electronic no-fishing report must be submitted electronically no later than 7 days after the end of that month. If a vessel owner or operator is aware of a period when fishing would not occur, a no-fishing report may be submitted anytime in advance of that period. If fishing subsequently occurs during time covered by a no-fishing report submitted previously, the vessel owner or operator would complete and submit the applicable fishing report.

Currently, NMFS shares commercial logbook data with the Atlantic Coastal Cooperative Statistics Program (ACCSP) as part of a partnership to combine fisheries-dependent information on the Atlantic coast from both Federal and state partners. Any software application that NMFS would approve also needs to meet the requirements to be submitted to the database managed by ACCSP. Because ACCSP combines data from multiple partners to create a comprehensive and consistent dataset, the compatibility of these data across systems is crucial. NMFS expects the continued use of ACCSP's system for partnering on various data collection systems. NMFS is also working towards a comprehensive reporting system for Federal fisheries across regions and may include other partners and data collection systems in the future. The proposed electronic CFLP would remain consistent with the goals and objectives for data collection set by the SEFSC and ACCSP.

To integrate the information currently collected by the paper logbook forms into the existing ACCSP database, slight modifications to the CFLP data fields would be required. For example, fields such as trip start time, trip end date, and trip end time would be added to prevent overlapping trip submissions. The addition of trip type would be added to so that the logbook software would show the data fields for that trip type. For example, if a fisherman selects a commercial trip, required data fields for a commercial trip would be shown. Primary area fished would be added to be compatible with the ACCSP database. Some data fields would be removed, including state trip ticket number and payment of catch. The signature field in the paper form would be replaced with a perjury statement that the submitter (an owner or operator) acknowledges and affirms the accurate and truthful data entry before submission can occur. Other data fields that may be modified include “hours/days,” which would default to hours to be consistent with the ACCSP database. In addition, the “sales disposition” data field would default to “sold to dealer” to be consistent with the ACCSP database. The retained catch (landings) would require an entry into the catch disposition category, which would default to “general: food.” Those selected to submit information on discards would be required to declare the disposition of both retained catch and discards.

The currently available software through ACCSP would be free to fishermen. NMFS is also testing a downloadable application for a phone and a computer, which is separate from the ACCSP software. Once software providers are approved by NMFS' SEFSC, they would be listed on the NMFS website https://www.fisheries.noaa.gov/southeast/resources-fishing/southeast-electronic-reporting-technologies. After NMFS finalizes the technical specifications and during implementation of the electronic CFLP, other vendors may create additional software applications. These vendors may charge a fee for use or provide an application at no cost. Fishermen would need internet access, such as via Wi-Fi or cellular service, to download an application and submit the electronic reports. However, fishermen would be able to input data in the application with or without an internet connection. If NMFS implements a final rule for commercial electronic reporting as described in this proposed rule, paper logbooks would no longer be accepted. Further, a vessel owner would continue to be required to comply with the electronic reporting requirements to renew or transfer a Federal commercial permit.

Prior to the implementation date of a final rule for the Commercial Electronic Logbook Amendments, NMFS would contact each permit holder by mail and email. Outreach sessions would be scheduled prior to the implementation of the program, and NMFS staff would be available to answer questions on how to get started with electronic reporting. If permit holders have specific questions related to the software, they should be directed to the applicable vendor. Vendors are required to have a help desk to assist with user questions. Prior to the implementation of the program, outreach materials would be available from NMFS to provide guidance about how the reporting requirements affect permit holders and how to use the software.

Pursuant to section 304(b)(1)(A) of the Magnuson-Stevens Act, the NMFS Assistant Administrator has determined that this proposed rule is consistent with the Commercial Electronic Logbook Amendments, the respective FMPs, other provisions of the Magnuson-Stevens Act, and other applicable law, subject to further consideration after public comment.

This proposed rule has been determined to be not significant for purposes of Executive Order 12866. This proposed rule is not an Executive Order 14192 regulatory action because this rule is not significant under Executive Order 12866.

The Chief Counsel for Regulation of the Department of Commerce certified to the Chief Counsel for Advocacy of the Small Business Administration that this proposed rule, if adopted, would not have a significant economic impact on a substantial number of small entities. The factual basis for this certification is as follows. A copy of the full analysis is available from NMFS (see the ADDRESSES section).

A description of this proposed rule, why it is being considered, and the objectives of this proposed rule is contained in the SUPPLEMENTARY INFORMATION section of this proposed rule. The Magnuson-Stevens Act provides the statutory basis for this proposed rule. No duplicative, overlapping, or conflicting Federal rules have been identified. In addition, no new reporting, record-keeping, or other compliance requirements are introduced by this proposed rule.

This proposed rule would modify the reporting method for owners and operators of commercial fishing vessels that currently report through the CFLP. Specifically, it would require the reports to be submitted electronically, which would improve monitoring and compliance of federally permitted commercial vessels in the CFLP. This proposed rule would not change any other existing reporting requirements, including those under the Gulf IFQ and South Atlantic ITQ programs. This proposed rule would directly apply to businesses that own or operate a commercial fishing vessel that is permitted to fish in Federal waters for Gulf reef fish, Gulf or Atlantic CMP species, Atlantic dolphin and wahoo, or South Atlantic snapper-grouper. A permit must be valid to harvest and land fish that apply to the permit, and under any of the Federal permits, fishing vessels are required to report commercial fishing activity or non-activity under the CFLP. This proposed rule would also apply to businesses that own or operate a commercial fishing vessel that does not have a CMP permit but harvests cobia from the Gulf or Atlantic Federal waters; however, all owners or operators of these vessels are expected to have at least one other Federal permit and report through the CFLP. All dollar figures presented below are in 2021 dollars.

From 2017 through 2021, an annual average of 1,030 owners or operators of federally permitted vessels reported making 22,912 trips within the South Atlantic that landed species managed as part of the CMP, dolphin and wahoo, or snapper-grouper fisheries. During the same period, an annual average of 666 owners or operators of federally permitted vessels reported making 8,037 trips within the Gulf that landed species managed as part of the CMP or reef fish fisheries. During that same 5-year period, there were considerable numbers of owners or operators of federally permitted vessels that reported they were inactive. For example, there was an annual average of 2,200 inactive vessels with a commercial permit for Atlantic dolphin and wahoo. The average annual revenue from all landings per active South Atlantic vessel was $25,498, while the average annual revenue from all landings per active Gulf vessel was $94,001. There is considerable variation of the average annual revenue per vessel by fishery. For example, the average active federally permitted Gulf reef fish vessel had an annual revenue from all landings of $121,609, while the average South Atlantic king mackerel vessel had an annual total revenue of $29,138. However, the largest annual revenue of any of the above active vessels was approximately $3 million (SEFSC logbook data).

For RFA purposes only, NMFS has established a small business size standard for businesses, including their affiliates, whose primary industry is commercial fishing (see 50 CFR 200.2). A business primarily engaged in commercial fishing (North American Industry Classification System code 11411) is classified as a small business if it is independently owned and operated, is not dominant in its field of operation (including its affiliates), and has combined annual receipts not in excess of $11 million for all its affiliated operations worldwide. If each commercial vessel, as described above, represents a unique commercial fishing business, then all commercial fishing businesses directly affected by this proposed rule are small. No other small entities that would be directly affected by this proposed rule have been identified.

This proposed rule would move the paper-based commercial logbooks under the CFLP for the aforementioned four fisheries to an electronic platform. To directly integrate the information currently collected by the paper logbook forms into the ACCSP database, slight modifications to the program data fields would be required. Six data fields would be added (although one is optional), three would be removed, and two would be modified.

The average owner or operator of a federally permitted vessel that reports landings in the South Atlantic reports 22 trips per year, while the average owner or operator of a federally permitted vessel that reports landings in the Gulf reports 12 trips per year. This proposed rule is not expected to change the number of federally permitted fishing vessels or the number of trips taken.

A commercial fishing vessel may operate in fisheries other than those under the jurisdiction of the Gulf and South Atlantic Councils and, therefore, have additional reporting requirements. For example, there are owners or operators of commercial vessels with a Federal permit to harvest CMP species, dolphin and wahoo, or snapper-grouper that also participate in fisheries managed by the Mid-Atlantic or New England Fishery Management Councils. Since November 10, 2021, all commercial vessels with Federal permits issued by NMFS GARFO for species managed by the Mid-Atlantic or New England Fishery Management Councils are required to submit eVTRs within 48 hours of the end of a trip (unless required sooner, as with some northeast groundfish sector programs). Consequently, since November 21, 2021, there have been owners or operators of commercial vessels that have to report both electronically and with a paper form to satisfy their existing reporting requirements. In addition, a Gulf or South Atlantic commercial fishing vessel may also operate under the Gulf IFQ or South Atlantic ITQ programs, or the southeast commercial HMS program, each of which has specific reporting requirements. All of these other reporting requirements provide information that is necessary for the administration of those programs, and this proposed rule would not change those requirements.

The switch from paper forms to electronic completion and submission is not expected to have a significant economic impact on small businesses. The proposed rule is expected to reduce duplication or overlap of existing record-keeping and reporting requirements. Because the proposed electronic submission requirements can be accomplished at low or no cost, no adverse economic impacts are expected from this proposed rule. Moreover, the conversion to electronic reporting for the commercial fishing sectors of these fisheries is expected to improve data efficiency and accuracy, which would benefit the small businesses in the long run.

Based on the above analysis, NMFS expects that this proposed rule would not have a significant economic impact on a substantial number of small businesses. As a result, an initial regulatory flexibility analysis is not required and none has been prepared.

This proposed rule contains a collection-of-information requirement submitted for review and approval by the Office of Management and Budget (OMB) under the Paperwork Reduction Act (PRA). This proposed rule would revise the existing requirements for the collection of information under OMB Control Number 0648-0016, Southeast Region Logbook Family of Forms. For reasons explained earlier in this preamble, the proposed revision would add six data fields (one of which is optional), remove three, and modify two for a net difference of adding two required data fields and modifying two existing data fields. NMFS does not expect the previously approved burden estimates for the CFLP information collection to change, due to the similar number of data fields and the application format, which uses dropdown options, toggles, and calendars. NMFS will evaluate the estimated burdens for this collection in 0648-0016 after users become acquainted with the electronic logbook. Along with the requested revision, NMFS requests an extension of the information collections under 0648-0016.

Public reporting burden for the CFLP are estimated to average 10 minutes per electronic fishing report and 2 minutes per no-fishing report. These estimates include the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information.

Public comment is sought regarding: whether this proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; the accuracy of the burden estimate; ways to enhance the quality, utility, and clarity of the information to be collected; and ways to minimize the burden of the collection of information, including through the use of automated collection techniques or other forms of information technology. Submit comments on these or any other aspects of the collection of information at https://www.reginfo.gov/public/do/PRAMain.

Notwithstanding any other provisions of the law, no person is required to respond or, nor shall any person by subject to a penalty for failure to comply with, a collection of information subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB control number. All currently approved collections of information may be viewed at https://www.reginfo.gov/public/do/PRAMain.

For the reasons set out in the preamble, NMFS proposes to amend 50 CFR part 622 as follows: